The Iranian Bomb: A Question of When

With a new, radical Islam-friendly US President in office, there is no longer a need to pretend that Iran has forsaken its nuclear weapons program. The Obama administration is fine with a nuclear Iran, which leaves only tiny Israel to decide whether to make its objections clear beyond the shadow of a doubt.

Iran reports having thousands of centrifuges spinning away to make fuel for their upcoming power reactors. Others think that Iran has it in mind to make weapons material using those same centrifuges. In fact, Iran could divert just 1% of its centrifuge production and have enough weapons-grade material to make a few bombs per year.

...A standard power reactor that generates electricity requires about 20 tons of uranium a year, utilizing uranium with about 4.5% U235 content. A centrifuge facility intended for this civilian use would be spinning thousands of centrifuges to do 106,000 SWUs each year. Diverting a bit of that 4.5% U235 and adding just 1,300 SWUs of additional effort would yield 20 kilograms of 94% U235. If this were to be done on the sly, about 1% of the total centrifuge work would have to be falsely labeled or otherwise disguised. Diligent inspectors might catch this, or they might not. _ThreatMatrix

The article above provides more technical information on using centrifuges to enrich uranium for various uses. More information can be found at Wikipedia.

A large number of western pundits -- oriented more toward appeasement than reality -- have trumpeted the "peaceful Iran" message, based upon an eroneous CIA "threat assessment" from 2007. But that message was either hopelessly naive or intentionally misleading. The chumps in academia, media, and the political sphere who fell for that line have conveniently moved on to other things.

Meanwhile, Iran just keeps on keeping on. SWU after SWU after SWU, the uranium 235 just keeps getting richer. (a SWU is a "separative work unit", or one batch around the centrifuge) With Obama as US president, Iran has nothing to fear from the great Satan.

Under 9 Months of Obama-Stim 56 of 57 States Have Lost Jobs

The only state out of Obama's 57 that has gained jobs over the past 9 months is North Dakota, a state that is rich with shale oil and gas. Once the Obama / Pelosi cap and stab bill is put into place, North Dakota will be able to join the other 56 states in "jobless recovery."

Lack of job growth is a major problem. The Labor Department said the number of newly laid-off workers filing claims for jobless benefits rose to a seasonally adjusted 531,000 last week, from an upwardly revised 520,000 the previous week. Wall Street economists had expected only a slight increase, according to Thomson Reuters.

Economists consider jobless claims a gauge of layoffs and a sign of companies' willingness to hire. _yahoofinance

The phantom recovery taking place is based upon deep deficit spending that continues to reduce the value of the US Dollar. Political payoffs in the hundreds of billions have been made, but that does not seem to be helping anyone outside the inner circle of power.

According to the data, 49 States and the District of Columbia have lost jobs since stimulus was enacted. Only North Dakota has seen net job creation following the February 2009 stimulus. While President Obama claimed the result of his stimulus bill would be the creation of 3.5 million jobs, the Nation has already lost a total of 2.7 million – a difference of 6.2 million jobs. To see how stimulus has failed your state, see the table below. _Source

Oh, are there only 50 states in the US? My mistake. I wonder where I heard that 57 number?

No matter. It should be obvious that a consumer-based economy can gain little traction for recovery, when more and more consumers have no income. Those credit card companies have put the squeeze on card holders as well, so consumers are being hit with a double whammy. No income. No credit.

It is asking too much for Obama to rethink his lifelong social and economic philosophy. But it may not be asking too much for voters to rethink their support of Obama. At least, all voters with an IQ above 90.

China's Bubble Problem

Is China really strong enough to bear the economic burden that the world is trying to put on its shoulders? US President Obama wants China to bail out his debt saturated government, but is that policy sustainable?

China's communist government owns a large part of the money-creation and money-spending apparatus. Money supply therefore shot up 28.5 percent in June. Since it controls the banks, it can force them to lend, which it has also done.

Finally, China can force government-owned corporate entities to borrow and spend, and spend quickly itself. This isn't some slow-moving, touchy-feely democracy. If the Chinese government decides to build a highway, it simply draws a straight line on the map. Any obstacle -- like a hospital, a school, or a Politburo member's house -- can become a casualty of the greater good. (Okay -- maybe not the Politburo member's house).

Although China can't control consumer spending, the consumer is a comparatively small part of its economy. Plus, currency control diminishes the consumer's buying power. All of this makes the United States' TARP plans look like child's play. If China wants to stimulate the economy, it does so -- and fast. That's why the country is producing such robust economic numbers.

Why is China doing this? It doesn't have the kind of social safety net one sees in the developed world, so it needs to keep its economy going at any cost. Millions of people have migrated to its cities, and now they're hungry and unemployed. People without food or work tend to riot. To keep that from happening, the government is more than willing to artificially stimulate the economy, in the hopes of buying time until the global system stabilizes. It's literally forcing banks to lend -- which will create a huge pile of horrible loans on top of the ones they've originated over the last decade.

But don't confuse fast growth with sustainable growth. Much of China's growth over the past decade has come from lending to the United States. The country suffers from real overcapacity. And now growth comes from borrowing -- and hundreds of billion-dollar decisions made on the fly don't inspire a lot of confidence. For example, a nearly completed, 13-story building in Shanghai collapsed in June due to the poor quality of its construction.

This growth will result in a huge pile of bad debt -- as forced lending is bad lending. The list of negative consequences is very long, but the bottom line is simple: There is no miracle in the Chinese miracle growth, and China will pay a price. The only question is when and how much.

...Now, China needs to stimulate its economy. It's facing a very delicate situation indeed: It needs the money internally to finance its continued growth. However, if it were to sell dollar-denominated treasuries, several bad things would happen. Its currency would skyrocket -- meaning the loss of its competitive low-cost-producer edge. Or, U.S. interest rates would go up dramatically -- not good for its biggest customer, and therefore not good for China.

This is why China is desperately trying to figure out how to withdraw its funds from the dollar without driving it down -- not an easy feat.

And the U.S. government isn't helping: It's printing money and issuing Treasurys at a fast clip, and needs somebody to keep buying them. If China reduces or halts its buying, the United States may be looking at high interest rates, with or without inflation. (The latter scenario is most worrying.)

All in all, this spells trouble -- a big, big Chinese bubble. Identifying such bubbles is a lot easier than timing their collapse. But as we've recently learned, you can defy the laws of financial gravity for only so long. Put simply, mean reversion is a bitch. And the longer excesses persist, the harder the financial gravity will bring China's economy back to Earth. _FPvia_ImpactLab

Chicago Wins Olympic Gold Medal in Gang Bang

The violence shown in the video is an everyday occurrence in Chicago, Obama's town. This day, a boy died. On some days, people are left to live in a coma for years before dying. Some days, they are merely crippled for life. This is a Chicago that is begging and pleading to host the summer Olympics. As if Chicago government was not corrupt enough already.

The violence you see is mere recreation for the youth of Chicago. An afternoon lark, a way of letting off steam.

What you see is the creation of a culture that has elevated blackness to the pinnacle of victimhood. For almost three full generations, American blacks have been soaking in special government attentions and preferences, in a putative attempt to compensate for less than one hundred years of slavery under US government sanction (1781 - 1865).

The result of this special attention is the dissolution of the black family and a 70% illegitimacy rate for black babies in America. An all pervading sense of victimhood and a need to exact vengeance floods the ghettoes, the projects, the churches, the mosques, and the schools where American blacks live and come together. This victimhood and vengeance mentality extends up into the black middle class -- largely employed by government and hired under affirmative action policies. It extends into the wealthy black class such as those in professional sports, entertainment and media, and even wealthy blacks in business.

But it is in communities and other areas exposed to lower class blacks that the results of government preferences for blacks is exposed most clearly.

The boy in the video died that day. And more will follow. Perhaps your own child. A lamb on the altar of appeasement and government dysfunction. Chicago is a good example of this Idiocratic decay, but it is only one of many. The rot is widespread and extends into Canadian and European cities as well, due to many of the same reasons.

Chicago -- land of the Olympics? The gang Olympics.

Obama and ACORN: Where Scum Floats

ACORN is under fire from many directions, accused of widespread voter fraud and other forms of criminality and corruption. President Obama is trying to pretend that he doesn't know much about ACORN and its corrupt, criminal record. But what are some of the facts about Obama and ACORN, that Obama doesn't want to bring up?

Mr. Obama took great pains to act as if he barely knew about Acorn. In fact, his association goes back almost 20 years. In 1991, he took time off from his law firm to run a voter-registration drive for Project Vote, an Acorn partner that was soon fully absorbed under the Acorn umbrella. The drive registered 135,000 voters and was considered a major factor in the upset victory of Democrat Carol Moseley Braun over incumbent Democratic Senator Alan Dixon in the 1992 Democratic Senate primary.

Mr. Obama's success made him a hot commodity on the community organizing circuit. He became a top trainer at Acorn's Chicago conferences. In 1995, he became Acorn's attorney, participating in a landmark case to force the state of Illinois to implement the federal Motor Voter Law. That law's loose voter registration requirements would later be exploited by Acorn employees in an effort to flood voter rolls with fake names.

In 1996, Mr. Obama filled out a questionnaire listing key supporters for his campaign for the Illinois Senate. He put Acorn first (it was not an alphabetical list). In the U.S. Senate, Mr. Obama became the leading critic of Voter ID laws, whose overturn was a top Acorn priority. In 2007, in a speech to Acorn's leaders prior to their political arm's endorsement of his presidential campaign, Mr. Obama was effusive: "I've been fighting alongside of Acorn on issues you care about my entire career. Even before I was an elected official, when I ran Project Vote in Illinois, Acorn was smack dab in the middle of it, and we appreciate your work."

But the Obama campaign didn't appear eager to discuss the candidate's ties to Acorn. Its press operation vividly denied Mr. Obama had been an Acorn trainer until the New York Times uncovered records demonstrating that he had been. The Obama campaign also gave Citizens Consulting, Inc., an Acorn subsidiary, $832,000 for get-out-the-vote activities in key primary states. In filings with the Federal Election Commission, the Obama campaign listed the payments as "staging, sound, lighting," only correcting the filings after the Pittsburgh Tribune-Review revealed their true nature.

Given his longstanding ties with Acorn, President Obama's protestations of ignorance or disinterest in the group's latest scandal seem preposterous. _WSJ

Of course, almost everything about Clown President Obama seems preposterous, if proper scrutiny is applied. The skank media has so far failed to apply scrutiny, but perhaps if they are forced by events outside their control . . . ?

More Video Footage From the Coming Dark Age

Maybe if you look the other way hard enough, they won't come for you. They'll come for your neighbor or your co-worker instead.
In modern Green Eutopia, one has no brothers, sisters, or cousins. Environmentally conscious Eutopians limit themselves to one child or none. That means that if the police are a little late on the scene, no one will help you. No one at all.
Too bad no one convinced the new arrivals to limit their progeny in the same way. As you can see, these novo quasi Eutopians are keeping the market supplied with unsupervised youth. And boys will be boys, especially when no one has enlightened them on the new tolerant lifestyle.
Things burn. Which is convenient for them, since they like burning things.

Video via niviusvir.wordpress.com/

Russia Has Problems

I asked a Russian friend how the financial and economic crisis had affected the regional art center in the Urals where she works. She said that she and her colleagues were coping with typical Russian resignation, and had made “нет дениг, нет проблем” (”No money, no problem”) their motto. _SeekingAlpha

No money, no problem? Maybe so. Certainly humans can learn to survive under a wide range of deprivations. But what is really happening in the post-Soviet era of Russian existence?

The Sayano-Shushenskaya dam disaster is widely considered to be a harbinger of potential problems. The direct economic consequences are severe, reducing Russian electrical generating capacity by 2 percent; this in fact understates the impact because the dam was an inframarginal (i.e., relatively cheap) source of power. The costs of repair are very high. Estimates run to $1.25 billion, but being estimates, being early, and being Russia, it is likely that the final bill will be much higher than that.

...But as bad as the direct cost of repairing this one dam is, the prospect that Russia is just waiting for many additional shoes to drop is even worse. And all at a time when there is no slack whatsoever in the budget; the state investment funds are being depleted rapidly, the budget deficits are forecast to be at the very upper limit that the country can run without risking grave risks to the currency, and Russia plans to return to the debt markets soon to cover its existing shortfalls. Nor can the country rely on foreign investors to step into the breach. The combination of poor economic prospects and a history of mistreatment has exacted its toll.

...In brief, Russia faces a yawning capital gap. The country has lived, after a fashion, on the Soviet inheritance, from huge hydro stations to massive gas fields. ”Deferred maintenance” became a modus operandi. The Sayano-Shushenskaya disaster is just a vivid illustration of the consequences of this. It makes me wonder what the true rate of Russian growth in recent years would be, if the true depreciation/consumption of capital were taken into account. The country has consumed much of its seed corn.

The country’s major source of cash–the energy business–has lived off the Soviet inheritance as well, so Russia can’t look to that for succor; indeed, that sector needs a massive infusion of capital too. Foreign investors won’t step up. Compared to other countries, Russia invested relative little as fraction of its GDP even during the seven fat years.

So, no money: big problems. _SeekingAlpha

What Russia needs, is to eliminate corruption and bring the "rule of law" to a relatively lawless state. Then it could open investments to foreign capital, and obtain the needed infrastructural improvements that can save the economy -- in the short term.

In the long term, Russia needs to become a country where young men and women can feel safe to marry and raise families, knowing that their children have a good chance at freedom, prosperity, and safety from crime and an arbitrary government.

Without all that, Russia is doomed.

Demography of Eur-Apocalypse

The old European is likely to live comfortably, to go abroad on vacations and have plenty of time for hobbies and entertainments. And to be child free, or perhaps one or two indifferently pampered children, if they can find the time. The new European is likely to be named Mohammed, to have twice as many children, if not twice as many wives, and to spend less time entertaining himself at operas and on vacations, and more time building a future for his family.
_Source

In a democracy, he who sires and raises more future voters than his neighbor will be the father of the future. But where violent movements such as Islamism and Islamic Supremacism are involved, just a small minority of citizens is enough to irrevocably alter the future of a society.

Muslim areas will expand as black holes of crime, governed by no police but Muslim police. There bombs will be built, rabid sermons delivered, stolen cars dropped off at chop shops and drugs smuggled through for distribution outside its borders. Murders, gang rapes, and every sort of crime will happen there without knowledge or recourse. These black holes will also pour forth a constant outcry of racism. And every now and then when the mood strikes them, the "youth" will pour forth to burn and loot. Source

As cars, neighborhoods, and large parts of cities burn, so does any hope of a peaceful and prosperous future for society at large. Peace with the violent disaffected inside-outsiders will only come with surrender of enlightened western rule of law, and equality under the law. Under the new regime of "peace", the majority is held hostage to the violent and intolerant minority.

As long as the European birth rate keeps falling, and Europe's borders remain open, and its politicians remain unwilling to begin exporting its former guest workers back to their countries of origin, Europe is doomed. The date may be unknown, but the trajectory is all too unfortunately clear.

When it comes to Muslims, Europe, Israel, America and every country infected with the Islamist plague retains only one real option, to deport them or to surrender to them. _FPM

Why Most Journalists are Biased Leftward

The following excerpt is from an article posted at a Psychology Today blog. It is well worth reading in its entirety.

As it turns out, the preponderance of journalists are Democrats. And socialism, with its idyllic, “progressive” programs, has formed an increasingly important role in Democratic policies. Who wants to investigate a possible dark side of your own party’s plank?

We’ll get to that. First—why are most journalists Democrats?

Unsurprisingly, self-selection plays an important role in choosing a job. People choosing to do work related to prisons, for example, commonly show quite different characteristics than those who volunteer for work in helping disadvantaged youths. Academicians have very different characteristics than CEOs—or politicians, for that matter.

Harry Stein, former ethics editor of Esquire, once said: "Journalism, like social work, tends to attract individuals with a keen interest in bettering the world.” In other words, journalists self-select based on a desire to help others. Socialism, with its “spread the wealth” mentality intended to help society’s underdogs, sounds ideal.

Most journalists take a number of psychology, sociology, political science, and humanities courses during their early years in college. Unfortunately, these courses have long served as ideological training programs—ignoring biological sources of self-serving, corrupt, and criminal behavior for a number of reasons, including lack of scientific training; postmodern, antiscience bias; and well-intentioned, facts-be-damned desire to have their students view the world from an egalitarian perspective. Instead, these disciplines ram home the idea that troubled behavior can be fixed through expensive socialist programs that, coincidentally, provide employment opportunities for graduates of the social sciences. Modern neuroscience is showing how flawed many of these policies have been—structural differences in the brains of psychopaths, for example, help explain why remedial programs simply helped them become better at conning people.

Academics in the social sciences tend to give short shrift to the dramatic failures and corruption within US educational system or unions. (Think here of the Detroit Public School system, or the National Education Association, whose former officers have written: “The NEA has been the single biggest obstacle to education reform in this country. We know because we worked for the NEA.”) Instead, because of their ideological biases, professors often emphasize that corporations are the bad guys, while unions and the government—at least the type of government that supports higher paychecks for social science professors and jobs for their students—are good. This type of teaching makes the Democratic Party and its increasingly socialist ideals seem naturally desirable, and criticism about how those ideals will supposedly be met less likely. (How many social scientists predicted that the billions spent on busing and the Projects would worsen the situations they were meant to solve, as ultimately happened?) It’s no wonder that journalists enter the profession as Democrats, then keep their beliefs intact through all-too-common tendencies to conform. _PsychologyToday

Follow the link and read the whole thing.

Journalists and other college educated leftists are blind because they enrolled in an academic program of self-blinding. They came by their biases in a step by step progression, by intentional programming.

Anyone who reads their drivel uncritically runs the risk of unconsciously following the same program of brain blinding and brain binding. Soon, if no contravening forces apply, an entire society can become mentally blind and subject to electing clowns as president. It could happen.

Any Analysis That Neglects Intelligence Is Sham

The respected magazine The Economist often presents economic and political analyses of various countries and regions. The Economist's looks at "Arab Backwardness" over the years neglect a very important consideration: intelligence of Arab populations.

Here are some Middle Eastern IQ and literacy rates to look at:

COUNTRY .... LITERACY RATE......AVERAGE IQ

Bahrain................. 85 ................... 83
Egypt ................... 51 ................... 83
Iran ..................... 71 ................... 84
Iraq ..................... 58 ................... 87
Israel ................... 95 ................... 94
Jordan .................. 86 .................. 87
Kuwait .................. 79 .................. 83
Lebanon ................ 83 .................. 86
Oman .................... 64 .................. 83
Qatar .................... 79 .................. 78
Saudi Arabia ........... 71 .................. 83
Syria ..................... 70 .................. 87
Turkey ................... 82 .................. 90
United Arab Emirates . 79 .................. 83

Canada has a 97% literacy rate, the USA has a literacy rate of 99%.
Canada has an IQ average of 97 and the USA has an average of 98. Source

The religion of Islam is a perfect fit for illiterate and unintelligent tribal peoples, such as arabs. Please be aware that the Arab world is genetically diverse and based upon the speaking of Arabic and / or the dominance of Islam. It is the legacy of past conquests and bloodshed.

Cousin inbreeding of low intelligence tribal people combined with rigid tribal and religious customs create and perpetuate a population of superstitious and violence - prone persons. Expressing surprise at the backwardness of such people without acknowledging such obvious underpinnings reveals The Economist as devious, manipulative, and / or incredibly credulous. But The Economist shares such traits with the most esteemed of modern academic and think tank geopolitica.

This "half blind" method of global and regional analysis typifies the modern approach to scholastic research. The next level will leave it all in the dust, of course. But for now, this willful ignorance is one of the great shames of modern human between-levels civilisation.

Backward and unintelligent people will conquer nations of far more intelligent and civilised people, if given the chance. The current government of the US appears intent on making such conquest appear easy. Whether such an appearance will be valid or not, it will lead such primitive people to believe that they can topple the "Great Satan." This makes war and violence far more likely than not.

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.