Monthly Archives: May 2012

Civics Quiz

President Obama says he supports gay marriage.  What does this mean?

A. You should vote for Obama because gay marriage is a good thing.

B. You should vote for Romney because gay marriage is a bad thing.

C.  Nothing.  It means nothing.

The correct answer is C, as Jeremiah wrote a few weeks ago.  The president’s opinion about constitutional matters is meaningless.  As part of that post, we described how the gay marriage issue would be settled in the real world.  In case there was any doubt, a federal appeals court today kicked the DOMA along its path toward the Supreme Court.

Candidates Romney and Obama are required to weigh in on civil rights issues, to placate certain interest groups.  These are zealots on the right and left, respectively, who don’t understand how the government works.


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Don’t Go To College

So, now we have a trillion-dollar student loan crisis.  Does this sound familiar to you?  It’s just like the mortgage crisis.  Going to college, like owning a house, is part of the “American Dream.”  Once something has American Dream status, our genius politicians figure it ought to be subsidized.  Never mind that “dream” means something you aspire to, work for, and so drive the American Economy.  No, you need to have a Pell grant and then a tax-deductible, government-backed mortgage.

Here’s the dirty little secret behind inflated college tuition – they know the government is paying!  Just like inflated house prices and inflated health care, the colleges know that your tuition is paid with taxpayer money – so they jack up the rates.  Dumping more money into this scam will not help students, not one little bit.  It will only make tuition go up.

If money were really tight, colleges would tighten their belts.  They would make serious decisions about providing value for the tuition dollar.  Students would make serious decisions about getting value, where “value” means a job after graduation.  You may not go to college at all!

Beckhoff now offers “academic apprenticeships”, which combine hands-on experience with study at a technical university.

That’s right – only in America do we have this obsession with higher education.  Successful countries, like Germany, stream young people right into vocational programs.  They have no shame about studying for a job versus studying for Zuccotti Park.

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Congratulations, Dr. Shaq!

As everyone knows by now, Shaquille O’Neal has taken his Ed. D degree from Barry University in Miami.  Local coverage is here.  Dr. O’Neal is doubly to be commended for seeking an academic challenge after completing a successful career in sports.  As one of his classmates put it,

He’s already been successful and has decided to take his career another step forward. As a millionaire athlete he could probably not do anything, just relax, retire. But he still wants more. I admire that. We all admire that.

According to the Herald, this was no retirement hobby.  O’Neal earned a 3.8 GPA, and he was doing postgraduate study while playing in the NBA.  O’Neal took his MBA in 2005.

Dr. O’Neal is a stellar role model.  Too many of our children want the glamour of sports, or rap music, or even politics.  Now we can tell them to do their homework, because “even Shaq finished school!”  His mother must be very proud.

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Same-Sex Unemployment

Jeremiah is a staunch supporter of gay rights, but we’re going to have to give the economy top priority this year.  The candidates have starkly differing views on the role of government, and this will have far-reaching consequences.  If you are gay and you favor a big central government, your choice is easy.  Barack Obama is the man for you.  On the other hand, if you are a gay entrepreneur, then you have a dilemma.

It’s too bad there is not a third party that features capitalism and civil rights (see Jeremiah’s four quadrants).  Fortunately, the Federal government is not actually the venue for rights issues.  That venue is the judiciary, with legislative input at the state level.  Greybeard activists will recall Brown v. Board of Education.

Here’s how it shakes out.  Under the 14th Amendment, states may legislate additional rights but they cannot subtract from your “basic” rights.  So, the first line of appeal for gay rights is your state legislature.  If gay marriage passes there, you’re done.  This is how marijuana is being legalized, one state at a time.

If yours is an intolerant, defense-of-marriage state, then you will have to sue.  Note that you must suffer an “injury” first, like being denied health coverage, and then you must sue the relevant state department.  As these lawsuits multiply, Federal courts – and ultimately the Supreme Court – will find that marriage, or at least its civil benefits, is a basic right of all Americans.

This is a long process, but it’s the only one.  Congress and the President will not settle this matter, any more than they have settled the abortion issue, racism, or women’s rights.  We are still waiting for that Equal Rights Amendment.  By the way, the Brown verdict was 9-0.  It didn’t need a packed bench or judicial activism.  The time for justice had come.

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Out of Ammo

Jeremiah has been a defender of Chairman Bernanke and his inflationary policy.  See chart here.  The timely application of “quantitative easing” averted a depression, and “operation twist” helped reduce mortgage rates.  At this point, however, monetary stimulus is no longer effective.  It was a temporary boost, a breather for fiscal policy to take effect – and fiscal policy has failed.

It is imperative for Congress to give us a fiscal policy … to achieve fiscal sustainability over the longer term; that is critical, and that’s something that needs to be addressed.

In his public remarks, Bernanke now pleads for some fiscal policy assistance.  He grudgingly promises more QE if needed, but this is played out and he knows it.  Employment is not recovering.

The Fed should not be responsible for employment, in any case.  They control exactly one of the economy’s levers, and Congress controls the rest.  The linkage between monetary policy and employment is weak at best, and only operates through a short-lived canard called the Phillips curve.  This is (was) the idea that you can hire more workers and then pay them with shrinking dollars.  It took the unions about a minute to figure that scam out and put an end to it.

The Fed’s sole objective should be monetary stability.  This means a stable dollar, relative to commodities and other currencies, and predictable interest rates.  That’s plenty.  Holding the Fed responsible for employment, too, is a sham – a way for Congress to duck its own responsibilities.

Here, then, is one area where we can fault Chairman Bernanke.  He seems too willing to accept new and inappropriate responsibilities – for instance, supervisory duties that belong with the FDIC and the SEC.  The institution, and the nation, would be better served by the Chairman drawing a clear line in the sand.  Bernanke should tell Congress, “I have done my job, now you do yours.”

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