Friday, October 31, 2014

Thursday, October 30, 2014

Making It Easy to Predict the Next Financial Crisis

By Alan Caruba

It is a cliché, but true, that history repeats itself. This is largely due to the failure of each new generation to learn anything from the past as well as the human tendency toward the bad habits of greed and power-seeking. Only the names and faces change.

That is why the next financial crisis is entirely predictable.

On October 23, The Wall Street Journal had an article, “Relaxed Mortgage-Lending Rules Clear Final Hurdle.”  The financial crisis in 2008 was the direct result of relaxed mortgage-lending rules. Indeed, it was the result of government pressure on banks to make “sub-prime” loans to people who any bank might sensibly conclude could not replay them. Those loans, in turn, were sold to Fannie Mae and Freddie Mac, two government-sponsored enterprises, who then bundled and sold them as mortgage-backed assets.

As Wikipedia notes, the Federal National Mortgage Association, commonly known as Fannie Mae, was founded in 1938 during the Great Depression to expand the secondary mortgage market by securitizing mortgages by issuing mortgage-backed securities, allowing lenders to reinvest their assets into more lending. In 1970 the Federal Home Loan Mortgage Corporation, whose nickname is Freddie Mac, was created for the same reason. Both are overseen by the Federal Housing Finance Authority. Neither issues mortgages. As noted, they buy them from banks, bundle them as securities, and resell them.

Getting the government involved in the housing market has been a supremely bad idea, much as getting the government involved in education and, as we are learning, involved in the nation’s healthcare insurance sector. There are only a few things the Constitution authorizes the government to do and none of these are mentioned. That has never stopped politicians.

The Wall Street Journal article reported that “Three U.S. agencies signed off on relaxed mortgage-lending rules, helping complete a long-stalled provision of the 2010 Dodd-Frank financial-overhaul law.” Two commissioners of the Securities and Exchange Commission “warned the rules would do little to prevent a return to the kind of lax mortgage underwriting that fueled the financial crisis.”

The Economist also took note, saying “When politicians bashed Wall Street for its reckless mortgage lending in the wake of the subprime crisis, bankers retorted that it was the politicians’ enthusiasm for expanding home ownership, even if it meant small deposits and low credit standards, that had really fomented the disaster.” Suffice to say there is plenty of blame to spread around, but the banks had to play by the rules the government had put in place.

In the wake of the financial crisis “many banks have stopped lending to riskier borrowers” but the new rules simply recreate the conditions that led to it, although “the rules only affect the tiny market for securities issued without federal backing, less than 2% of the $1.58 trillion in mortgage securities issue in 2013…”

The rule changes are being hailed as an example of the how great the “reform” implemented after the financial crisis was in the form of the Financial Stability Oversight Council and Orderly Liquidation Authority, otherwise known as the Dodd-Frank Act.

Suffice to say it is a regulatory nightmare of several thousand pages of rules, often quite vague, that are still being interpreted. That said, its purpose, to prevent predatory mortgage lending, improve the clarity of mortgage paperwork for consumers, and reduce incentives for mortgage brokers to push home buyers into more expensive loans was needed. It also changed the way credit card companies and other consumer lenders had to disclose their terms to consumers.

As The Economist noted, the agreement regarding mortgage-lending rules “would permit banks to securitize and sell mortgages without retaining a 5% stake—leaving them little incentive to maintain high lending standards.” That needs repeating: little incentive to maintain high lending standards, the very reason we had a financial crisis in 2008.

All this is largely due to the progressive notion that everyone, no matter how little they earn, should be able to purchase a home. In reality, those at the low end of the economic ladder should not be encouraged or seduced into taking on such debt. When they do and the economy goes south, leaving them unemployed, they just walk away from the debt.

Why should the rest of us—taxpayers—bail out the mortgage sector as we did in 2008 with huge loans to the banks and insurance companies that had purchased mortgage-based securities? The government had to step in with the complete government takeover of Freddie Mac and Fannie Mae. We got stuck with the bill.

It also drove up our national debt, leading to the first reduction in the nation’s credit rating in its history.

There is already talk on Capitol Hill that, should Republicans take control of the Senate and retain it in the House, they are likely, as Reuters reported, “to target the Consumer Financial Protection Bureau and capital requirements on insurance companies.” To put it another way, the Republicans are the adults in Congress while the Democrats, liberal to the core, will never admit we are being set up for another financial crisis.

© Alan Caruba, 2014

Wednesday, October 29, 2014

Obama's Amnesty Travesty

By Alan Caruba

People really need to read the U.S. Constitution. It says, “All legislative Powers herein granted shall be vested in a Congress of the United States.”

The Constitution makes no reference whatever to executive orders (EO). George Washington started the practice mostly because he had to. Traditionally executive orders have been treated by Congress as having the legal status of legislation, but only insofar as they apply to the management of how the government operates.

The Constitution makes it quite clear that the President has no power to enact laws, but as long as an EO does not unilaterally alter or negate existing legislation or run counter to the Constitution Congress usually accords it legitimacy. Those that do not honor the separation of powers have been struck down by the courts or by legislation that opposed them.

As is widely rumored and reported, if President Obama does attempt to issue amnesty to illegal aliens he would be over-riding or altering existing immigration law. He does not have the power to do that.

Such an executive order would be immediately challenged in the courts and if power in the Senate passes to the Republicans in the midterm elections, Congress would oppose it. With an eye on the 2016 elections, incumbent Democrats might not be willing to go along with an Obama amnesty EO.

Recent polls all demonstrate opposition to amnesty. In a September Investors Business Daily/TIPP poll 73% of the public said that Obama should work with Congress on immigration reform. After the invasion of an estimated 150,000 young people and others from Guatemala and San Salvador earlier this year, comprehensive immigration reform went from 54% approval last year to 48%.

When word leaked that the U.S. Citizenship and Immigration Services agency had requested bids on a minimum of four million blank work permits and green cards a year for the next five years, there was an outcry in political and immigration policy circles. “There aren’t enough federal employees from here to Pluto to do adequate background checks on 34 million,” said Bob Dane, spokesman for the Federation for American Immigration Reform.

In September, the Census Bureau released new data on the U.S. population finding that the nation’s immigrant population (legal and illegal) hit a record 41.3 million in July 2013, an increase of 1.4 million since July 2010. Since 2000, the immigrant population is up 10.2 million and double the number in 1990, nearly triple the number in 1980, and guadruple that in 1970, which it stood at 9.6 million.

It’s no secret President Obama has wanted to get as many immigrants as possible, especially those from south of the border, into America. He has winked at the laws that determine immigration and citizenship. In 2011 many believed he had “enacted” the Dream Act by EO, but he had not. His administration instead adopted a policy regarding the deportation of illegal immigrants brought to the U.S. as children, granting them the option of applying for two-year work permits. Even conservatives could find some merit in this, allowing them to gain legal status and apply for citizenship.

The amnesty issue would play havoc prior to the November 4 midterm elections, so Obama will wait until after them to announce his intentions. I doubt he thinks an executive order will go unchallenged, but at that point it will not matter to him since he will not be running for reelection in 2016. His indifference to constitutional restraints on his power as President is well known.

On October 22 Iowa Rep. Steve King, a Republican, predicted Obama will “violate the Constitution, break the law and grant executive amnesty.”

“If the President takes this action,” said Rep. King, “ (that) he’s threatened to take we will have abandoned every pretext of the Constitution of the United States and if the American people take that setting down or lying down, then our constitutional republic has been destroyed.”

Rep. King is right, but the Obama EO will be challenged in the courts and in Congress. If that effort is opposed by Democrats in Congress, their midterm losses will barely rival what the 2016 election will hold for them.

© Alan Caruba, 2014

Tuesday, October 28, 2014

Is America in Decline?

By Alan Caruba

In case you have had the feeling that America is in decline and will make way for a new superpower, you may be right. At least you’re right if you agree with James MacDonald, the author of “When Globalization Fails: The Rise and Fall of Pax Americana” (due in January 2015, Farrar, Straus and Giroux). Given his review of the rise and fall of previous powerful nations, history, and a current analysis, they come together to say our days of global influence are over.

In a way, the election of Barack Obama is the perfect example of failed leadership, both as President and as a nation that others used to rely upon to maintain world peace, protect the sea lanes necessary for trade, and intervene when rogue players threaten their neighbors and the world.

For the first time in most people’s memory, our former allies and those nations looking toward America to see what action it will take or not no longer have any confidence in our willingness to take any action. More specifically, what action President Obama will or will not take. The rise of the Islamic State is a response to Obama’s abandonment of the Middle East.

Obama arrived in office with the belief that America was the problem and has proceeded to diminish Pax Americana (Latin for ensuring peace) in every way possible. He began by apologizing for America for having been too aggressive in the past and not having much good to say about it except in the most perfunctory and obligatory way.

MacDonald’s book is a historical review of previous world powers like Pax Britannia and the rivalries of colonial powers like Spain, Portugal, France and Germany. Bit by bit nations began to regard world trade as a brake on potential wars—they were wrong as in the case of the last century—and as a way to lift all nations toward greater prosperity. International organizations like the League of Nations and the United Nations have demonstrated no ability to ward off combat or the threats posed by rogue nations like North Korea or Iran.

“If the world’s great and rising powers are going to avoid conflict, it will require a determined effort to avoid the pitfalls of history,” says MacDonald.

MacDonald offers eight elements that produced the era of peace that began in post-war 1945 when the U.S. emerged with a thriving, growing economy while those in Europe and Asia were devastated. My generation looks back on those years knowing they were likely the best America will enjoy and hoping our economy will not be devastated by a national debt of $18 trillion and unfunded liabilities of $127 trillion!

It takes a historian to remind us that “One of the main lessons of history is that history lessons are eventually forgotten.” One need only look around the world for proof of that. The U.S. is not the only nation spending itself into a black hole. MacDonald reminds us, too, that it was the Cold War between the U.S. and then-Soviet Union that helped maintain “an unquiet peace” because neither nation would ever use its nuclear weapons. MacDonald fears “an equally intense Sino-American hostility” as China flexes its muscles. Don’t be surprised to see Japan acquire a nuclear shield or other Asian nations in China’s sphere of influence.

MacDonald has little faith in the United Nations which “can be effective only on the basis of consensus among the major powers, and it is not clear that any such consensus would prevail in a multi-polar world.”

As for Pax Americana, the rise of China is a major challenge. “Now that capitalism (euphemistically described as ‘socialism with Chinese characteristics’), has been adopted by a rising power that rejects the idea of Pax Americana entirely, its future is uncertain.” China, “the new hegemon has so far shown itself to be far from benign, displaying a tendency to bully its potential clients over such things as offshore oil resources, water supplies, and access to rare earths.”

“If states are not to return to self-destructive competition for resources, free trade remains a sine qua non of peace,” says MacDonald. “Compared to the nineteenth century, free trade has the advantage of being embedded in international organizations and agreements, in particular the World Trade Organization.”

The future, as always, is clouded and there remains the threat of financial meltdowns. The U.S. had one in 2008 that required massive amounts of federal bailouts to avoid a worse outcome. We have been in the Great Recession ever since.

MacDonald notes that decolonization played a major role in the period following World War I and II. “The breakup of the European empires, even though it has often created its own sources of conflict, has contributed to the postwar peace among the Great Powers by breaking up economic blocs and reducing the causes of friction and envy that helped spur wars.” The lessons of U.S. intervention in Afghanistan and Iraq demonstrate that what was easier in the past is no longer.

At the moment when the Obama administration is desperately trying to arrive at an agreement with Iran that will not permit it to make its own nuclear weapons, MacDonald believes that the threat of nuclear weapons may be the chief means to enforce any peace worldwide. The flaw in this is whether a fanatical Islamic power would resist their use.

MacDonald concludes that “The United States will, in all likelihood, remain center stage in world affairs” for some time to come.

Ridding the nation of its current, unpopular President and unlocking the hold that the Democratic Party has imposed on Congress, will be a major step in the right direction for the nation. Finding a leader who will encourage economic growth and resist our enemies will play a major role in restoring the power and influence we have had.

© Alan Caruba

Monday, October 27, 2014

Passionate About Conservatism

By Alan Caruba

We conservatives tend to be rather low key when it comes to expressing our commitment to conservative values. We are all about the Constitution, small government, a strong military, and fiscal prudence, but these are not things that are easy to talk about in a passionate way, no matter how strongly we feel about them.

As a longtime—try fifty-plus years—book reviewer, I get lots of them and recently “Right for a Reason: Life, Liberty, and a Crapload of Common Sense” by “the Chicks on the Right”, Miriam Waver and Amy Jo Clark arrived ($26.95, Penguin Group).

The “Chicks” started a website in 2009 that quickly gained a large audience of people who love their approach to conservatism and their interpretation of the events of the day, issues, and personalities. Need it be said it also attracted all manner of rude, nasty responses from liberals?

“If you’re reading this right now”, they say in the introduction, “chances are you’re a frustrated conservative. And you’ve got good reason to be frustrated. If you’re like us, you’re practically dizzy from how often you’ve shaken your head at the stupidity of low-information voters who couldn’t pick Nancy Pelosi out of a photo lineup, but can rattle off the names of every single member of the Kardashion clan.”

“Maybe you’re frustrated that conservatives haven’t been able to effectively communicate their ideas in a way that resonates with the public. Maybe you’re frustrated that the mainstream media has been complicit in glamorizing the liberal narrative.”  Well, yes, I have felt this way, but I am also aware that the Internet has provided those with the nation’s political life with scads of information on many excellent websites.

Then, too, Rush Limbaugh has been a major voice on radio with a huge audience as is Sean Hannity, Michael Savage and others. By far the most popular shows devoted to the issues are conservative while liberals attract so few listeners and viewers you wonder why there are still so many liberals. One need only compare the Fox News Channel with MSNBC to know the appeal of conservatism and, yes, a conservative interpretation of the news--accurate facts!

In the lead up to the November 4 midterm elections, something remarkable is happening. There are stories noting that Obama has lost the support of a significant number of women and among black Americans. Even the mainstream press has taken note of this and it suggests that, despite our frustrations, maybe our message is having an impact. Or, maybe, these two groups, after six years of Mr. Hope and Change, have decided independently that his policies have not helped them in any way other than turn them into people dependent on the government instead of being able to support themselves and their families.

As the “Chicks” point out, “Despite what the mainstream media wants you to believe, there are thousands and thousands of people out there who are just like us.” Yes! That is the answer. I recall when Ronald Reagan so encouraged and inspired them that a large segment became known as Reagan Democrats. But that was then and this is now.

“Right for a Reason” will, I believe, appeal a tad more to women readers, though men will enjoy their straight-forward analysis and the humor with which they infuse a book that is passionate about conservatism.

I think, too, that this book will appeal to younger readers, the Millennials, because it addresses the fundamental differences between liberals and conservatives. “While liberals cling like tree sloths to promise of everything being provided to them by the government, conservatives cling to the notion of self-sufficiency.” And conservatives don’t think you’re greedy if you want to make a good living and more money than someone who is not willing to work as hard as you.

That’s why conservatives were so annoyed when President Obama said, regarding anyone who is successful, “If you’ve got a business—you didn’t build that. Somebody else made that happen.”  There isn’t a single man or woman who has put hours into their business that did not instantly take offense, but Obama was also revealing his deeply socialistic point of view that it is the “collective” that gets things done, not individuals.  Wrong! In the earliest days of the nation, roads, bridges, and canals were built to facilitate business. A huge railroad system was built both to make money and to make it easier for people to travel to the west coast to create businesses or sell to those who were already there, and vice versa.

America is all about capitalism and that explains why it became the world’s superpower in the wake of World War II. In the process it saved Europe from communism and entered into 46 years of a Cold War with the then-Soviet Union. Even so, Europe has long since embraced socialism.

To a great degree, so has America with is vast plethora of “entitlement” programs that were introduced as “a safety net”, but are now so integrated into the life of the nation that millions use them to avoid work because one can often receive more from the government than a job would provide! As the “Chicks” put it, “There is a time and a place for welfare. We believe in safety nets. We believe in helping people. We believe that the weakest among us and the people down on their luck should get assistance."

It’s refreshing to read a book that is passionate about conservatism. We all need to be.

© Alan Caruba, 2014

Sunday, October 26, 2014

Obama's War on U.S. Energy

By Alan Caruba

September 19th was an anniversary you did not read or hear about in the nation’s news media. It marked six years—2008—since the first permit application for the construction of the Keystone XL pipeline was submitted to the federal government. Can you imagine how many jobs its construction would have created during a period of recovery from the 2008 financial crisis? President Obama is universally credited with delaying it.

Thomas Pyle, the president of the American Energy Alliance, pointed out that World War II, the construction of the Hoover Dam, and the Lewis and Clark Expedition all took place in less time. In a September Forbes article, he noted that “Earlier this year a Washington Post/ABC News poll found that 65 percent of Americans support building the pipeline, while only 22 percent oppose it. In Washington three-to-one margins are usually referred to as mandates.”

In contrast, in March 2013 the then-Interior Secretary of the Interior, Ken Salazar, boasted “In just over four years, we have advanced 17 wind, solar, and geothermal projects on our public lands.”  It is not these projects that Americans depend upon for energy. The opposite is a stark explanation why coal, oil, natural gas and nuclear energy remain the heart blood of the economy.

The Daily Caller reported in July that the “U.S. Bureau of Land Management is currently sitting on a backlog of 3,500 applications that need approval to move forward on drilling for oil and natural gas on federal land,” just part of Obama’s war on U.S. energy.

According to the U.S. Energy Information Administration, fossil fuels met 82% of U.S. energy demand in 2013.

Petroleum, primarily used for transportation, supplied 36% of the energy demand in 2013. Natural gas represented 27%. Coal represented 20% and generated almost 40% of all electricity. In the six years since Obama took office that is a loss of 10%!

The much ballyhooed “renewable sources” of energy, justified by the false claim that carbon dioxide emissions are causing global warming or climate change, are a very small part of the nation’s power providers. Wind power represented 1.6% and solar power represented three-tenths of 1%! Hydropower supplied 2.6% making it the largest source of so-called renewable energy.

Politically, it has been Democrats advocating renewable sources and siding with the President’s delay of the oil pipeline and the Environmental Protection Agency’s assault on coal-fired plants to produce electricity. By contrast, the Republican-controlled House of Representatives has been busy putting forth legislation to fix aspects of our energy problems and needs.

Some of the bills that were introduced included H.R. 2728: The Protecting State’s Rights to Promote American Energy Security Act; H.R. 3: The Northern Route Approval Act (regarding the keystone XL Pipeline; H.R. 1900: The Natural Gas Pipeline Permitting Reform Act; H.R. 2201: The North American Energy Infrastructure Act; and H.R. 6: The Domestic Prosperity and Global Freedom Act, intended to expedite the export of liquefied natural gas to our allies around the world. The global market is growing at a colossal pace.

These bills will likely all die in the U.S. Senate, controlled by the Democratic Party. The Nov 4 midterm elections can change that if enough Republicans are elected to gain control.

It’s not just natural gas that is helping the economy improve. The Financial Times reported in late September that “The U.S. is overtaking Saudi Arabia to become the world’s largest producer of liquid petroleum, in a sign of how its booming oil production has reshaped the energy sector.” Why? “The U.S. industry has been transformed by the shale revolution, with advances in the techniques of hydraulic fracturing and horizontal drilling enabling the exploitation of oilfields, particularly in Texas and North Dakota.”

The only places you won’t find oil drilling are on federally controlled lands. The same holds for coal and natural gas.

This is in keeping with a virtual war on U.S. energy waged from the White House. Consider what we have witnessed:

# Obama has refused to let the Keystone XL pipeline be built.

# Billions wasted on loans to renewable energy companies, many of which like Solyndra and Solar Trust of America went bankrupt.

# Obama made electric cars like the Chevy Volt part of his energy policy, providing subsidies but their high cost and low mileage capacity has resulted in few sales.

# Obama and the EPA advocated a cap-and-trade tax on greenhouse gas emissions when there has been no global warming for 19 years and carbon dioxide plays no role whatever in the Earth’s climate.

# The Obama administration terminating the construction of a nuclear waste repository at Yucca Mountain in Nevada despite nearly $15 billion already spent on this necessary repository.

These are just a few examples, but in the meantime, the U.S. still requires that a valuable food commodity, corn, be turned into ethanol, an automotive fuel additive, that (a) reduces the millage in every gallon and (b) increases its cost at the pump. As Seldon B. Graham, Jr., a longtime energy industry consultant and observer, notes that “Ethanol production peaked in 2011 at 6% of total oil demand.” Favoring replacing imported foreign oil with American oil, Graham says “Americans would have saved $64.7 billion on the oil price since 2009.”

Americans are afflicted by a President and his administration that for political and environmental reasons are costing them trillions in needless, senseless energy costs, loans and subsidies, and efforts to impose laws that have no basis whatever in science.

© Alan Caruba, 2014

Friday, October 24, 2014

Cartoon Round Up




Ebola! Ebola! Yawn

By Alan Caruba

How is Ebola spread? Two ways; one, by letting anyone exposed to it in West Africa into America when they fly here and, two, by assuming that medical professionals and others who have been exposed to it would quarantine themselves from contact with others once they are here.

The latest case is Dr. Craig Spencer, an American to whom the travel ban would not apply, identified as potentially having Ebola after treating victims in Africa and who totally ignored the potential of spreading it to others as he made his way around New York on subways, went bowling, and likely had dinner at a restaurant.

Earlier a NBC news crew that had been exposed to Ebola was issued a mandatory quarantine by the New Jersey Health Department, but its chief medical editor and correspondent, Dr. Nancy Snyderman, while symptom-free, decided to break the quarantine. One of the crew, Ashoko Mokpo, did fall ill and is being treated at the Nebraska Medical Center.

What does it tell you when two medical professional behave in this manner? It tells you that even those who know they can infect others were indifferent to the risk. It tells you that airport staff armed with thermometers are no defense against anyone coming in from the Ebola hot zone in Africa.

It tells you that the failure to impose a ban on all flights from West Africa should have been imposed weeks ago.

It tells you that sending three thousand active duty soldiers and another thousand reservists into the Ebola hot zone is a senseless act that exposes them to the disease and countless others on their return unless they are all held in quarantine until no signs of the disease are detected. The risk still remains even after the twenty-one days that the Center for Disease Control cites as the time in which victims would show signs of the disease.

The two Dallas nurses who acquired the disease have been treated and one has been released. As of October 23, there were eighteen cases of Ebola in Europe and the U.S. Unlike Africa, Western nations have responded quite well to the threat.

In New York, the Mayor, Bill de Blasio, was joined by the Governor Andrew Cuomo to hold a

press conference that seemed to this observer intended to exonerate them of any charge they were not taking Dr. Spencer’s foolishness lightly and to avoid public panic among a public that is clearly not panicking.

Given the continued news coverage of Ebola, it is amazing that Americans have absorbed the fundamental message that the disease has not affected those outside the healthcare community with the exception of the NBC crew and that steps have been put in place to identify and isolate those who had it. Moreover, while a deadly virus in Africa, it has been treated and cured here in America.

So far, so good.

The real challenge will be the flu season when lots of people will show up at hospitals with flu symptoms that resemble Ebola symptoms. If you haven’t been vaccinated, get one! How hospitals deal with this is going to be a real test of their judgment and skills.

I am hopeful we may be spared more press conferences that don’t tell us anything more than what we already know. I surely don’t want to hear President Obama tell me that everything is fine and there is nothing to worry about.

© Alan Caruba, 2014

Thursday, October 23, 2014

Visitors? Count'm at 3.8 Million

Warning Signs has passed a new milestone--3.8 million visitors. This blog averages 70,000 visits a month at this point and for that I am very thankful.

I always aim to produce a commentary, one of five each week, that provides documented information and useful analysis to understand a very complex world.

For that the donations received are especially welcome and important to help cover office and IT costs.

Here's a special THANK YOU to those who have given donation in the past and I hope I can count you as one in the future.

Alan Caruba

The Islamic Madness Persists

By Alan Caruba

The lull in the coverage of all things Islamic was broken by two terrorist attacks in Canada, a reminder that so long as the world does not unite to destroy the Islamic State, we shall all remain vulnerable. A “lone wolf” terrorist can kill you just as dead as one in a terrorist organization, particularly one encouraging these attacks.

While the media’s herd mentality continues to report about Ebola in West Africa and gears up for massive coverage of the forthcoming November 4 midterm elections, the Middle East remains in a low state of boil, never failing to produce bombings, skirmishes, and the usual inhumanities we associate with Islam.

Americans pay attention to the Middle East only when blood is flowing and at the present time the only element generating that is the Islamic State (ISIS) which continues to attack Kobani in northern Syria and assault the Yazidis and other targets in Iraq. The U.S., Britain and France are bombing ISIS forces, largely to protect and assist the Kurdish Peshmerga forces, the only fighting force of any consequence.

Virtually unreported are the 18 million Muslim refugees throughout out the Middle East. The U.N. reports that these and internally displaced persons reflect the turmoil in Afghanistan, Iraq. Libya, Pakistan, Somalia, Syria, and Yemen. To grasp this, think about what either the U.S. or Europe would be like with a comparable number of refugees.

As David P. Goldman, a Senior Fellow at the London Center for Policy Research and Wax Family Writing Fellow at the Middle East Forum, noted October 20 on the Forum website, “That is cause for desperation: unprecedented numbers of people have been torn from traditional society and driven from their homes, many with little but the clothes on their backs.”

“There are millions of young men in the Muslim world sitting in refugee camps with nothing to do, nowhere to go back to, and nothing to look forward to…never has an extremist movement had so many frustrated and footloose young men in its prospective recruitment pool.”

So what does John Kerry, our Secretary of State, think is the greatest problem in the Middle East? While discussing the ISIS coalition with Middle East leaders, Kerry expressed the opinion a week ago that the Israeli-Palestine situation was the real problem. Apparently he is unaware that there is no Palestinian state and never has been. The one on the West Bank exists thanks to Israeli support and the one in Gaza, controlled by Hamas, provoked Israeli defense measures by rocketing it for months.

Prof. Efraim Inbar, director of the Begin-Sadat Center for Strategic Studies and a Shillman/Ginsberg fellow at the Middle East Forum, has a quite different point of view. “In reality, however, the novelty of the Islamic State, as well as the magnitude of the threat it poses, are greatly exaggerated.”

Noting that many of the Arab states have “failed to modernize and deliver basic services” Prof. Inbar has little anticipation that ISIS could do that either. Moreover “Much of the fragmented Arab world will be busy dealing with its domestic problems for decades, minimizing the possibility that it will turn into a formidable enemy for Israel or the West.”

What has seemed to escape Kerry’s and the President’s attention is the threat of a nuclear armed Iran. The negotiations to encourage Iran to step back from its efforts to create the warheads for its missiles do not appear to promise a favorable outcome. Iran managed to get some sanctions lifted and that was likely why Iran entered into them. They don’t care what the West or the rest of the Middle East wants.

Neither Israel, nor Saudi Arabia are as naïve as the U.S. In March, Richard Silverstein, writing in Tikun Olam, reported that “the level of intense cooperation between Israel and Saudi Arabia in targeting Iran has become clear. Saudi Arabia isn’t just coordinating its own intelligence efforts with Israel. It’s actually financing a good deal of Israel’s very expensive campaign against Iran.” A recent explosion at an Iranian nuclear facility suggests that the campaign is still quite active.

Noting “airtight military censorship in Israel”, Silverstein pointed out that information about the Israeli-Saudi relationship would not have been reported in an Israeli daily newspaper, Maariv, if both governments did not want Iran and the U.S. to know. In effect, the Saudis have replaced the U.S. as a source of support given President Obama’s barely concealed dislike of Israel.

“But Israel,” wrote Silverstein, “isn’t going to war tomorrow.” Israel will watch the outcome of the U.S.-Iran negotiations and determine what action to take or not at that point. Meanwhile, it will keep the pressure on Iran with its covert program.

At some point the news media will begin to pay more attention to the Middle East. It will not get much cooperation, however, from ISIS because the Islamic State has made it clear that only journalists that obey its rules and write what it wants will live very long.

The “religion of peace”, Islam, has not produced much peace in the Middle East and elsewhere in the world for the last 1,400 years. 
© Alan Caruba, 2014

Wednesday, October 22, 2014

No Ebola Panic Despite Media Hysteria

By Alan Caruba

One man has died of Ebola in the U.S. and he came here from Liberia. Two of the nurses that tended him are in intensive care and likely to survive. A third was thought to be infected, but wasn’t. That news has been sufficient to keep most Americans calm as the media has done its best to exploit Ebola-related news.

The public absorbed the facts and came to their own conclusion.

An October 8 Pew Research survey found that “Most are confident in Government’s ability to prevent major Ebola outbreak in U.S.”  That reflects the way we have all been conditioned to look to the federal government to solve our problems, but the public mood had not changed by October 20 when a Rasmussen Reports analysis of a survey concluded that “Americans are keeping their cool about Ebola, but some acknowledge that they have changed travel plans because of the outbreak of the deadly virus in the United States.” 

Wrong. There has been no “outbreak.” One dead Liberian and two nurses is not an outbreak.

Fully 66% of the Rasmussen respondents said that Ebola is a serious public health problem, including 29% who deemed it very serious, but few believe it is an active public health threat here in the U.S.  

All this was occurring as spokesmen for the Centers of Disease Control tried to both warn and reassure Americans, managing only to evoke a measure of derision. President Obama also sought to reassure Americans, but fewer and fewer believe anything he has to say these days.

Then he appointed an “Ebola czar” who had no medical or healthcare background whatever to qualify for the job. Add in Obama’s failure to institute a travel ban and the likelihood is that Democratic candidates will pay a price for this on Nov 4. 

I suspect the President’s advisors are telling him the Ebola problem has been a blessing because the media will not be reporting any of the stories that could harm Democratic candidates. Starting with the fact that the nation’s voters are evenly divided between a liberal or conservative point of view that means that independent voters will be the deciding factor and they are independent because they pay more attention to events and the news.

One of the stories that are being held back from the news is the outcome of the U.S. Army investigation of Sgt. Bowe Bergdahl who was traded by Obama for five top Taliban leaders to secure his release. Members of his unit unanimously say he deserted them and, if that is the Army’s conclusion, it makes the swap look dubious, if not treasonable.

The news after the midterm elections will be filled with reports of employers cutting healthcare insurance to both full and part-time employees. Wal-Mart has already announced this for its part-timers. There is already news of the fact the ObamaCare, the Affordable Patient Care Act, is proving to be very expensive for those who signed up. This includes news about its higher deductibles and premiums.

Robert E. Moffit, a senior fellow in The Heritage Foundation’s Center for Health Policy Studies, recently reported that “Thanks to ObamaCare, Health Costs Soared this Year”, noting that “On November 15, open enrollment in the ObamaCare exchanges begins again.” Among the lessons learned from Year One of ObamaCare is that “Health costs jumped—big time.” Compared with employer-based coverage, the average deductible of a little over $1,000, doubled to more than $2,000.

Obama promised that the typical family premium cost would be lowered by $2,500, but it has actually increased and ObamaCare actually reduced competition in most health-insurance markets. We do not know how many Americans are actually insured. Despite predictions of millions who would be insured, the administration “now concedes that there are 700,000 fewer persons in the exchanges.”

The claim was that ObamaCare would reduce U.S. health spending, but a recent Health and Human Services report—delayed as long as possible—found that its Accountable Care Organization element has increased costs. States are dropping out of ObamaCare exchanges as a result.

The Obama administration has been very quiet about his intension to by-pass Congress to impose an amnesty program for the eleven million or more illegal aliens in the US. Most polls demonstrate widespread opposition to amnesty. Obama is expected to try to institute one anyway.

Lastly, unless the Islamic State shows up at the gates of Baghdad and takes control, there is likely to be little news from an Iraq that exists now in name only.

The results of Obama’s six years in office have been a disaster in many ways and the outcome of the midterm elections will have a dramatic effect on Obama’s ability to continue his destruction of the U.S. economy and other policies.

Essentially, a majority of Americans, including many of his former supporters, have concluded that there is no Ebola crisis and that Obama’s time in office has been the very opposite of what he promised. The change they want is to see an end to Obama’s term in office. A start in that direction is the November 4 midterm elections.

© Alan Caruba, 2014

Tuesday, October 21, 2014

The "Malaise" Has Returned

By Alan Caruba

The joke is that Jimmy Carter is happy that Barack Obama has replaced him as the worst President of the modern era.  It is a supreme irony that Obama’s campaign theme was “Hope and Change” when Americans have lost a great deal of hope about their personal futures and the only change they want is to see Obama gone from office.

Elected by a narrow margin in 1976, Carter managed in his one term to see his approval ratings fall to twenty-five percent by June 1979. The lesson Americans have to learn over and over again is that liberal policies and programs don’t work.

In six years, the kind of dependence on the government to take care of people from cradle to grave has left the nation with 92 million unemployed or who have stopped looking for a job, entitled 45 million to food stamps, and there is still talk of a “minimum wage” in the interest of “fairness” that simply kills jobs, especially those that used to be filled by young people just entering the workplace. The worst part of Obama’s presidency is the lies he tells in the belief, apparently, that most Americans are so stupid they won’t see through them.

On July 15, 1979, in an effort to encourage a greater sense of confidence, Jimmy Carter delivered a speech that became known as the “malaise” speech, but which did not include that word. What it did, however, is double down on all the bad policies Carter had pursued and blamed Americans for not accepting them. By then the economy was in decline, gasoline prices and interest rates had climbed to record levels, and the voters were understandably pessimistic. Iranians had taken U.S. diplomats hostage and they would not be released until Ronald Reagan took the oath of office.

Carter’s speech began by asking “Why have we not been able to get together as a nation to resolve our serious energy problem?”  Quite literally there was no need then or now for an energy problem because, as recently noted by the Energy Information Administration, the United States has enough coal to last more than 200 years! With the development of hydraulic fracturing, fracking, we now have access to more oil than exists in Saudi Arabia.

Obama literally came into office saying he intended to wage a war on coal and he has; using the Environmental Protection Agency to institute regulations that have led to the closing a mines and the shutdown of coal-fired plants that used to produce 50% of the nation’s electricity; now down to 40%. He resisted allowing the drilling for oil in the huge reserves on our east and west coasts. He has refused to permit the construction of the Keystone XL pipeline. These policies have led to the loss of thousands of jobs during the time that followed the 2008 financial crisis.

In his speech, Carter said, “The erosion of our confidence in the future is threatening to destroy the social and the political fabric of America.” We would do well to remember that we have been through periods like this before and corrected course.

In 1980 Ronald Reagan would be elected to replace Carter and America prospered through his two terms, returning to being a major superpower, economically and militarily. That’s what conservatism produces.

Carter, however, blamed Americans for the problems of his times. “Two-thirds of our people do not even vote. The productivity of American workers is actually dropping, and the willingness of Americans to save for the future has fallen below that of all other people in the Western world.”
One of Obama’s earliest acts was to visit foreign nations and blame America for many of the world’s problems. Militarily he pulled our troops out of Iraq and he intends to do the same in Afghanistan. He has cut the military budget to the bone and has now defined its mission as one to address “climate change”, not the enemies of our nation.

Obama spent his entire first term blaming George W. Bush for every problem that he did nothing to correct. Indeed, Obama has never seen himself as the real problem, finding anyone else to blame.

Those Americans watching Carter deliver his speech must surely have cringed as he announced that he intended to set import quotas on foreign energy resources. He said he wanted Congress to impose a “windfall profits” tax on the very energy firms that he wanted to get us out of the doldrums and dependency that was causing the problem. He wanted the utility companies to “cut their massive use of oil by fifty percent within a decade.” He wanted them to switch to coal and now we live in a nation whose President doesn’t want our utilities to use coal. Why? Despite massive evidence to the contrary, he has advocated “renewable” energy, wind and solar, neither of which can ever meet the nation’s needs.

“In closing, let me say this: I will do my best, but I will not do it alone. Let your voice be heard,” said Carter.
In the 1980 election the voter’s voice was heard. Carter was gone and Reagan was our President. With him came his infectious patriotism and optimism. By late 1983 his economic program had ended the recession he inherited from Carter. A similar program would have put an end to what is now routinely called Obama's Great Recession.

We are at a point not dissimilar from the days of Jimmy Carter and with an even greater sense of dissatisfaction and distrust of Barack Obama.

I reach back in our recent history to remind you that on November 4th in our midterm elections and in the 2016 presidential election we can repeat history by ridding the nation of those members of Congress that voted for ObamaCare and have supported President Obama. We must wait to see who the GOP will offer as a presidential candidate, but we have time for that.

We have time to “hope” for a better future and we have the means to make the “change” to achieve it.
© Alan Caruba, 2014

Monday, October 20, 2014

Democratic Voting Bloc-Heads

By Alan Caruba

As this is being written, Rasmussen Reports says that 48% of likely voters approve of President Obama’s performance in office while 50% disapproved. Other polls indicate far more unhappiness with Obama, but in general one must conclude that half the voters are idiots. He is an enormous failure domestically and with his foreign relations.

In early July, a Quinnipiac University national poll found that Obama was regarded as “the worst president since World War II.” The only poll that counts will be the midterm elections on November 4th.

We know that Republicans and a significant percentage of independent voters will pull the lever for the change needed to save the nation from Congressional gridlock and whatever further mischief and idiocy Obama will seek to impose, but what do we know about the Democratic Party’s voting blocs? They say a lot about America today.

A website called, offers a look at the “Economic Demographics of Democrats.” It offered the following conclusions:

# Generally, Democrats live closer to a coast—East or West—living more in cities than Republicans. Populated areas have a higher concentration of minorities who “overwhelmingly vote Democrat.”

# They tend to have more women in their ranks than Republicans and this is true as well of gays and lesbians.

# They support organized labor, unions, more.

# They are slightly younger than Republicans and “increasingly less religious.”

After years have telling Americans that Republicans are engaged in “a war on women” it should not come as a surprise that 37% of women are Democrats while Republicans have 24%. Unmarried women vote Democrat about 62% of the time, while married women tend to split between the parties.

What may well save the nation from the split between the two political parties is the fact that 43% declare themselves to be politically independent.

Economically, people earning less than $15,000 a year represent 31% of Democrat voters. Those earning $50,000 or more vote Republican or independent.  The average median household income in the U.S. is $49,777, right near the point where the Democratic advantage in numbers disappears.

While the President and the Democratic Party are forever complaining about the inequality of the wealthy while endlessly taking their money for campaigns, a review of the twenty richest Americans as listed by Forbes magazine found that 60% affiliate with the Democratic Party!

Would it surprise anyone to learn that Republicans are better educated than Democrats? Or that Democrats tend to be slightly younger, with an average age of 47. This voting bloc, 46 million, is anticipated of increase to 90 million in 2020.

Racially and ethnically, Republicans are 87% white as compared to Democratic supporters.
African Americans mindlessly vote Democratic and are literally taken for granted by the party though an Oct 18 New York Times article reported that a confidential memo from a former pollster for President Obama “contained a blunt warning for Democrats. Written this month with an eye toward Election Day, it predicted ‘crushing Democratic losses across the country’ if the party did not do more to get black voters to the polls.” He said, “In fact, over half aren’t even sure when the midterm elections are taking place.”  That’s the kind of voter the Democratic Party has relied upon for years.

Jews as well give 80% of their votes to Democrats. Hispanics are the fastest growing group of voters and also tend to support Democrats, voting for them 60% to 70% of the time. They constitute 16% of the population and are expected to nearly double by 2050.

Observers of politics at this point note that Democrats are stepping up an aggressive push to woo single women, regarding of their age, level of education, or earning power, but they also note that many single women do not vote, especially in non-presidential election years like this one. The result is that older, white and more conservative women will vote more. One analyst, Jackie Calmes, notes that, according to the nonpartisan Voter Participation Center, in the 2012 presidential election, 58% of single women voted, but is predicting that will slide to 39%.

In an American September commentary, Chad Stafko, wrote that “The African-American voting block has become powerless and irrelevant due to its decades-old blind allegiance to the Democratic Party and the growing likelihood (is) that the group will soon be eclipsed in size by the Hispanic voting bloc.”  The judgment of this bloc is best seen in the fact that African Americans have voted for Democrats for years to serve as mayors in “what are now some of the most economically-challenged cities in America.” Despite having voted for Obama at a rate of 93%, they have “received the brunt of the effects of the Obama-led stagnant economy.”

While there is much talk of the growing Hispanic bloc, but many are ineligible to vote and those that are often do not or are concentrated in noncompetitive districts and states. One observer, Nate Cohn, noted that “Hispanic voters will represent a tiny fraction of the electorate in the states and districts critical to the battle for control of Congress.”  Currently that represent about 17% of the U.S. population and a quarter of them are under age 18 and cannot vote. Only 69% of adult Hispanics are citizens as compared with 96% of adult-non-Hispanics.

In general, Democrats may have numbers, but those voters are just as likely to skip the upcoming midterm elections. When you add in concerns about Ebola and the economy, there’s even more reason to believe they are less motivated to vote. In contrast, Republicans and a large segment of independent voters are far more motivated.

The Democratic Party depends on voting blocs of less educated, less wealthy, more knee-jerk voters than the Republican Party, and thanks to a liberal news media the GOP has problems getting out its message and responding to the lies the Democratic Party incessantly repeat.

Even so, political pundits are predicting that the midterm elections will sweep Democrats from office and defeat their candidates. That’s the good news.

© Alan Caruba, 2014

Sunday, October 19, 2014

Killing Confidence in Our Government

By Alan Caruba

What has been the over-riding theme of life in America since Barack Obama became President in 2008?

It has been the continued loss of confidence Americans have regarding various elements of the federal government. From the Centers for Disease Control, the Veterans Administration, the Secret Service, to the Department of Justice and the Internal Revenue Service, these and other agencies have been tainted in ways that have turned his two terms into a litany of scandals and failures.

Obama is a President for whom politics is the sole reason against which every decision is made.

The latest example was the naming of an Ebola Czar. “Sources confirm to Fox News that President Obama plans to name Ron Klain, a longtime political hand with no apparent medical or health background.” In the past, Klain has served as chief of staff to Al Gore and Joe Biden. Does this make you feel any better about the Ebola threat?

I think that most Americans—not the “low information” ignorant ones—are experiencing a generalized depression about the nation these days. It’s a sense of weariness because our paychecks don’t stretch enough in the supermarket where the cost of food, particularly meat and fish, is soaring.

We wonder about the quality of education our children or grandchildren are receiving. It’s poor when compared to other nations and it undermines a belief in America's exceptionalism.

In growing numbers younger Americans are choosing not to marry because of the costs involved and because we live in a society that no longer frowns on a couple living together; nearly half of marriages end in divorce. And then there’s same-sex marriage, a concept that was unthinkable not that long ago and for centuries in all societies.

We’re now six years into the Great Recession thanks to a White House that thought that, if the government spent $834 billion on top of the national debt, it would somehow “stimulate” the economy but government spending did not relieve Americans during the Great Depression, generate new jobs or achieve anything else that this tried-and-failed liberal theory was said to do. Who was in charge of Obama’s “stimulus” program? Ron Klain, the new Ebola Czar.

Cutting taxes, slowing and reducing regulations, and generally getting out of the way to allow people to start or expand their businesses works, but the White House went the other direction.

As an October 16 Wall Street Journal editorial noted, “Millions of American families haven’t had a raise in after-inflation incomes in years, but in Washington times are flush…the U.S. federal government rolled up record revenues of $3.013 trillion.” Individual income tax receipts rose by 5.9%, along with payroll taxes and corporate income taxes—very nearly the highest in the world—increased 16% to $321 billion. 

Only the naïve or ignorant believe that the government knows how to spend our money better than we do, but liberals—Democrats—do. Their answer to every problem government encounters is more money, but not to repair and expand the infrastructure, roads and bridges, on which the nation depends and not for a military that is currently at low pre-World War Two levels of personnel and old equipment of every description.

Our current Secretary of State, John Kerry, is going around echoing the President, telling people that mankind is doomed because “climate change” is coming and will destroy all life unless billions or trillions are spent in ways that will avoid it. Only no one can avoid climate change because that’s what climate does; it changes with well-known and predictable cycles tied to the Sun’s cycles.

Our military’s mission is now being redirected to addressing “climate change” at a time when, having been withdrawn from Iraq, a new, larger and far more dangerous entity, the Islamic State, has emerged, stretching into Syria as well.

The President recently gave an interview to France’s Canel+ TV Channel and said that the American people need to be better educated about Islam, claiming that the U.S. should be regarded as a Muslim country because of the number of Muslims living here. The truth is that the U.S. has one of the smallest percentages of Muslims of any Western nation, about 1.5% of the population. Americans know everything they need to about Islam. They recently watched two of their countrymen beheaded by the Islamic State.

The President appears to prefer unapologetic liars as his advisors. Consider Susan Rice who came to fame by lying on five Sunday television shows that the Benghazi attack in 2012 was the result of a video no one had seen and more recently said that Turkey had agreed to permit the U.S. to undertake military flights to attack ISIS only to have Turkey deny that within hours. She is Obama’s national security advisor and that is cause enough for concern, but guess to whom the new Ebola Czar, Ron Klain, will be reporting? Susan Rice.

While Obama has been in office the population has been growing by virtue of the millions of illegal aliens that have been entering. This year there was a dramatic virtual invasion of children and others from Guatemala and San Salvador at the invitation of the President. They were quickly dispersed throughout the U.S. and just as quickly schools around the nation began to report outbreaks of the diseases they brought. At the same time, deportations have declined this year.

The President has sent more than 4,000 of our military to Africa’s Ebola hot zone and he did so rapidly as what will be described as a humanitarian gesture, but he has never seen any necessity to dispatch our military to our southern border to stem illegal entry. Indeed, his administration has taken Arizona to court when it passed legislation to address the problem. In the meantime, we are left to wonder what will happen if our soldiers become ill with Ebola?

Indeed, his signature legislation, ObamaCare, is destroying our healthcare system and is a testament to the lies he repeatedly told before the Democrats in Congress passed it in 2009. No Republican voted for it. After the midterm elections, hundreds of thousands will learn that their employers will no longer provide them with healthcare insurance.

Americans are left to wonder how the nation can survive a President who has steadily engaged in programs that have harmed America’s economy—he is the first to have had our national credit rating reduced.

In the process he has ignored the limits imposed on his office by the Constitution. The courts have repeatedly rebuked this.

On November 4th voters will have an opportunity to go to the polls and vote out as many of his supporters, incumbent Democrats and candidates for Congress, as possible. 

Our confidence in our government must be restored with new leadership.

© Alan Caruba, 2014