Michael Bryant: Ontario's Chief Pickpocket!

If you want to see how arrogant (and incompetent) the Ontario government has become then look no further than this and this.

Barack Obama: New Pork is the Old Pork

I received this interesting e-mail and thought it worthy to repost:

The Stimulus Shopping List: $1.17 Trillion in Pork Goodies

Having trouble putting down that cigarette? The stimulus bill has $75 million for programs to help people quit smoking. Only 42 percent of Americans now think the bill is a good idea, according to Rasmussen Reports, which had found 45 percent approval last week. (AP Photo)

The $1.17 trillion stimulus bill passed by House Democrats on Wednesday bears little resemblance to the bill originally proposed by President Obama, with less than 5 percent of the funds now going to repair Americas deteriorating infrastructure.

GOP critics point out the bill is loaded with tens of billions for items ranging from Amtrak subsidies to sexually transmitted diseases to the National Endowment for the Arts -- much of which won't actually flow into the economy until long after economists expect the current economic crisis to subside.

In late November, Obama promised: It will be a two-year, nationwide effort to jump start job creation in America, and lay the foundation for a strong and growing economy. We'll put people back to work rebuilding our crumbling roads and bridges, modernizing schools and stimulating development of alternative forms of energy.

Even some Democrats are now objecting that the measure contains too few highway and mass transit projects. Moreover Mark Zandi, chief economist for Moody's Economy.com, says most of the infrastructure spending in the plan won't occur until 2010 or later.

Keeping in mind that this is supposed to be a stimulus bill, here are provisions of the bill that many legislators are questioning:

• $1 billion for Amtrak, which hasn't earned a profit in four decades.
• $2 billion to help subsidize child care.
• $400 million for research into global warming.
• $2.4 billion for projects to demonstrate how carbon greenhouse gas can be safely removed from the atmosphere.
• $650 million for coupons to help consumers convert their TV sets from analog to digital, part of the digital TV conversion.
• $600 million to buy a new fleet of cars for federal employees and government departments.
• $75 million to fund programs to help people quit smoking.
• $21 million to re-sod the National Mall, which suffered heavy use during the Inauguration.
• $2.25 billion for national parks. This item has sparked calls for an investigation, because the chief lobbyist of the National Parks Association is the son of Rep. David R. Obey, D-Wisc. The $2.25 billion is about equal to the National Park Services entire annual budget. The Washington Times reports it is a threefold increase over what was originally proposed for parks in the stimulus bill. Obey is chairman of the House Appropriations Committee.
• $335 million for treatment and prevention of sexually transmitted diseases.
• $50 million for the National Endowment for the Arts. $4.19 billion to stave off foreclosures via the Neighborhood Stabilization Program. The bill allows nonprofits to compete with cities and states for $3.44 billion of the money, which means a substantial amount of it will be captured by ACORN, the controversial activist group currently under federal investigation for vote fraud. Another $750 million would be exclusively reserved for nonprofits such as ACORN meaning cities and states are barred from receiving that money. Sen. David Vitter, R-La., charges the money could appear to be a payoff for the partisan political activities community groups in the last election cycle.
• $44 million to renovate the headquarters building of the Agriculture Department.
• $32 billion for a smart electricity grid to minimize waste.
• $87 billion of Medicaid funds, to aid states.
• $53.4 billion for science facilities, high speed Internet, and miscellaneous energy and environmental programs.
• $13 billion to repair and weatherize public housing, help the homeless, and repair foreclosed homes.
• $20 billion for quicker depreciation and write-offs for equipment.
• $10.3 billion for tax credits to help families defray the cost of college tuition.
• $20 billion over five years for an expanded food stamp program.
  

Republican leaders say the stimulus package will add 32 new government programs at a cost of $136 billion. They object that many of the programs, once established, are likely to continue indefinitely.

Most media outlets are reporting the cost of the package at $819 billion. As Newsmax revealed yesterday, however, the Congressional Budget Office calculates that the interest on the debt generated by the bills spending will cost another $347.1 billion, making the total cost approximately $1.17 trillion.

Of course, the measure contains hundreds of billions in tax cuts and infrastructure projects that conservatives will find palatable. But as House Minority whip Eric Cantor, R-Va., told the media Wednesday, "This was not a stimulus bill. It was a spending bill."

Michael Campbell on the Big 3 Automakers Bailout

Michael Campbell was on fire this morning! You can listen to his full editorial here (@ 34:50).

Here's a key part of what he said:

How incompetently run would a business have to be to not qualify for government aid? Cause that's not on the table right now. We're not accepting or rejecting businesses based on how incompetently they've been run. Helping failing or failed businesses is nothing new but it seems particularly acute this year. And with the granddaddy of them all, promising up to seven billion dollars in Canada for three major American car companies.

I'm used to governments blowing money. Anyone who has read an auditor general's report knows all about that, whether you want to acknowledge it or not. But this one, this promise to spend $3 billion dollars right now, as much as $7 Billion in the future and that still may not be enough to bailout the shareholders, the unions, and the executives of the Big 3 Automakers is just so BIG.

Take a moment and think about that kind of money. And we're doing it with virtually no debate whatsoever. Politicians who know nothing of the credit crisis or business or finance, politicians who saw none of this coming are now going to give money to the same management teams who took their companies to the brink of disaster. As if they can get them out of it.

But still, no political debate. Not from Jack Layton, who in my opinion, in terms of economics and finance, is the most unsophisticated leader in national politics since Audrey McLaughlin. No debate from the Liberals, who are vying with the NDP for support of the CAW. And no debate from the Conservative government who are still reeling from the breathtaking miscalculation of Stephen Harper and Jim Flaherty that nearly brought their government down. We are so incredibly poorly served by our national parties.

But before all you politicals light your hair on fire, consider this: How much would $3 Billion, maybe up to $7 Billion, maybe more ... how much could it buy in terms of health care, education, solving the homeless problem, you name it?! To borrow from the late senator, Everett Dirksen, "A billion here and a billion there and pretty soon we're talking about real money." Well, we are talking about real money here, maybe as much as $7 Billion+ worth.

Now let me make one thing clear. If you support this bailout, why don't you man-up for a change? Why don't you man-up and put your own money down? Why don't you buy the stock of GM or their bonds? There's nothing to stop you. Nothing but common sense.

I'll tell you, throwing money at these 3 failed automakers in an environment that will see a profound drop in vehicle sales this coming year sure doesn't top my investment list for 2009.

But what I find really grating is that this is all about political connections and clout. It's about campaign funds and courting the CAW.

My only worry in this debacle have been the dealerships and part manufacturers who do run good businesses. They have hitched their ponies to the wrong wagons but here's the big problem: I don't have any confidence that the money is going to do the trick. Not when we are on the cusp of a dramatic fall in new vehicle consumption. That seems clear.

The Letter from 122 Top Economists to Congress

To the Speaker of the House of Representatives and the President pro tempore of the Senate:

As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson to deal with the financial crisis. We are well aware of the difficulty of the current financial situation and we agree with the need for bold action to ensure that the financial system continues to function. We see three fatal pitfalls in the currently proposed plan:

1) Its fairness. The plan is a subsidy to investors at taxpayers’ expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise.

2) Its ambiguity. Neither the mission of the new agency nor its oversight are clear. If taxpayers are to buy illiquid and opaque assets from troubled sellers, the terms, occasions, and methods of such purchases must be crystal clear ahead of time and carefully monitored afterwards.

3) Its long-term effects. If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America's dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted.

For these reasons we ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come.

Signed (updated at 9/25/2008 8:30AM CT)

Acemoglu Daron (Massachussets Institute of Technology)
Adler Michael (Columbia University)
Admati Anat R. (Stanford University)
Alexis Marcus (Northwestern University)
Alvarez Fernando (University of Chicago)
Andersen Torben (Northwestern University)
Baliga Sandeep (Northwestern University)
Banerjee Abhijit V. (Massachussets Institute of Technology)
Barankay Iwan (University of Pennsylvania)
Barry Brian (University of Chicago)
Bartkus James R. (Xavier University of Louisiana)
Becker Charles M. (Duke University)
Becker Robert A. (Indiana University)
Beim David (Columbia University)
Berk Jonathan (Stanford University)
Bisin Alberto (New York University)
Bittlingmayer George (University of Kansas)
Boldrin Michele (Washington University)
Brooks Taggert J. (University of Wisconsin)
Brynjolfsson Erik (Massachusetts Institute of Technology)
Buera Francisco J. (UCLA)
Camp Mary Elizabeth (Indiana University)
Carmel Jonathan (University of Michigan)
Carroll Christopher (Johns Hopkins University)
Cassar Gavin (University of Pennsylvania)
Chaney Thomas (University of Chicago)
Chari Varadarajan V. (University of Minnesota)
Chauvin Keith W. (University of Kansas)
Chintagunta Pradeep K. (University of Chicago)
Christiano Lawrence J. (Northwestern University)
Cochrane John (University of Chicago)
Coleman John (Duke University)
Constantinides George M. (University of Chicago)
Crain Robert (UC Berkeley)
Culp Christopher (University of Chicago)
Da Zhi (University of Notre Dame)
Davis Morris (University of Wisconsin)
De Marzo Peter (Stanford University)
Dubé Jean-Pierre H. (University of Chicago)
Edlin Aaron (UC Berkeley)
Eichenbaum Martin (Northwestern University)
Ely Jeffrey (Northwestern University)
Eraslan Hülya K. K.(Johns Hopkins University)
Faulhaber Gerald (University of Pennsylvania)
Feldmann Sven (University of Melbourne)
Fernandez-Villaverde Jesus (University of Pennsylvania)
Fohlin Caroline (Johns Hopkins University)
Fox Jeremy T. (University of Chicago)
Frank Murray Z.(University of Minnesota)
Frenzen Jonathan (University of Chicago)
Fuchs William (University of Chicago)
Fudenberg Drew (Harvard University)
Gabaix Xavier (New York University)
Gao Paul (Notre Dame University)
Garicano Luis (University of Chicago)
Gerakos Joseph J. (University of Chicago)
Gibbs Michael (University of Chicago)
Glomm Gerhard (Indiana University)
Goettler Ron (University of Chicago)
Goldin Claudia (Harvard University)
Gordon Robert J. (Northwestern University)
Greenstone Michael (Massachusetts Institute of Technology)
Guadalupe Maria (Columbia University)
Guerrieri Veronica (University of Chicago)
Hagerty Kathleen (Northwestern University)
Hamada Robert S. (University of Chicago)
Hansen Lars (University of Chicago)
Harris Milton (University of Chicago)
Hart Oliver (Harvard University)
Hazlett Thomas W. (George Mason University)
Heaton John (University of Chicago)
Heckman James (University of Chicago - Nobel Laureate)
Henderson David R. (Hoover Institution)
Henisz, Witold (University of Pennsylvania)
Hertzberg Andrew (Columbia University)
Hite Gailen (Columbia University)
Hitsch Günter J. (University of Chicago)
Hodrick Robert J. (Columbia University)
Hopenhayn Hugo (UCLA)
Hurst Erik (University of Chicago)
Imrohoroglu Ayse (University of Southern California)
Isakson Hans (University of Northern Iowa)
Israel Ronen (London Business School)
Jaffee Dwight M. (UC Berkeley)
Jagannathan Ravi (Northwestern University)
Jenter Dirk (Stanford University)
Jones Charles M. (Columbia Business School)
Kaboski Joseph P. (Ohio State University)
Kahn Matthew (UCLA)
Kaplan Ethan (Stockholm University)
Karolyi, Andrew (Ohio State University)
Kashyap Anil (University of Chicago)
Keim Donald B (University of Pennsylvania)
Ketkar Suhas L (Vanderbilt University)
Kiesling Lynne (Northwestern University)
Klenow Pete (Stanford University)
Koch Paul (University of Kansas)
Kocherlakota Narayana (University of Minnesota)
Koijen Ralph S.J. (University of Chicago)
Kondo Jiro (Northwestern University)
Korteweg Arthur (Stanford University)
Kortum Samuel (University of Chicago)
Krueger Dirk (University of Pennsylvania)
Ledesma Patricia (Northwestern University)
Lee Lung-fei (Ohio State University)
Leeper Eric M. (Indiana University)
Leuz Christian (University of Chicago)
Levine David I.(UC Berkeley)
Levine David K.(Washington University)
Levy David M. (George Mason University)
Linnainmaa Juhani (University of Chicago)
Lott John R. Jr. (University of Maryland)
Lucas Robert (University of Chicago - Nobel Laureate)
Luttmer Erzo G.J. (University of Minnesota)
Manski Charles F. (Northwestern University)
Martin Ian (Stanford University)
Mayer Christopher (Columbia University)
Mazzeo Michael (Northwestern University)
McDonald Robert (Northwestern University)
Meadow Scott F. (University of Chicago)
Mehra Rajnish (UC Santa Barbara)
Mian Atif (University of Chicago)
Middlebrook Art (University of Chicago)
Miguel Edward (UC Berkeley)
Miravete Eugenio J. (University of Texas at Austin)
Miron Jeffrey (Harvard University)
Moretti Enrico (UC Berkeley)
Moriguchi Chiaki (Northwestern University)
Moro Andrea (Vanderbilt University)
Morse Adair (University of Chicago)
Mortensen Dale T. (Northwestern University)
Mortimer Julie Holland (Harvard University)
Muralidharan Karthik (UC San Diego)
Nanda Dhananjay (University of Miami)
Nevo Aviv (Northwestern University)
Ohanian Lee (UCLA)
Pagliari Joseph (University of Chicago)
Papanikolaou Dimitris (Northwestern University)
Parker Jonathan (Northwestern University)
Paul Evans (Ohio State University)
Pejovich Svetozar (Steve) (Texas A&M University)
Peltzman Sam (University of Chicago)
Perri Fabrizio (University of Minnesota)
Phelan Christopher (University of Minnesota)
Piazzesi Monika (Stanford University)
Piskorski Tomasz (Columbia University)
Rampini Adriano (Duke University)
Reagan Patricia (Ohio State University)
Reich Michael (UC Berkeley)
Reuben Ernesto (Northwestern University)
Roberts Michael (University of Pennsylvania)
Robinson David (Duke University)
Rogers Michele (Northwestern University)
Rotella Elyce (Indiana University)
Ruud Paul (Vassar College)
Safford Sean (University of Chicago)
Sandbu Martin E. (University of Pennsylvania)
Sapienza Paola (Northwestern University)
Savor Pavel (University of Pennsylvania)
Scharfstein David (Harvard University)
Seim Katja (University of Pennsylvania)
Seru Amit (University of Chicago)
Shang-Jin Wei (Columbia University)
Shimer Robert (University of Chicago)
Shore Stephen H. (Johns Hopkins University)
Siegel Ron (Northwestern University)
Smith David C. (University of Virginia)
Smith Vernon L.(Chapman University- Nobel Laureate)
Sorensen Morten (Columbia University)
Spiegel Matthew (Yale University)
Stevenson Betsey (University of Pennsylvania)
Stokey Nancy (University of Chicago)
Strahan Philip (Boston College)
Strebulaev Ilya (Stanford University)
Sufi Amir (University of Chicago)
Tabarrok Alex (George Mason University)
Taylor Alan M. (UC Davis)
Thompson Tim (Northwestern University)
Tschoegl Adrian E. (University of Pennsylvania)
Uhlig Harald (University of Chicago)
Ulrich, Maxim (Columbia University)
Van Buskirk Andrew (University of Chicago)
Veronesi Pietro (University of Chicago)
Vissing-Jorgensen Annette (Northwestern University)
Wacziarg Romain (UCLA)
Weill Pierre-Olivier (UCLA)
Williamson Samuel H. (Miami University)
Witte Mark (Northwestern University)
Wolfers Justin (University of Pennsylvania)
Woutersen Tiemen (Johns Hopkins University)
Zingales Luigi (University of Chicago)
Zitzewitz Eric (Dartmouth College)

Source: http://faculty.chicagogsb.edu/john.cochrane/research/Papers/mortgage_protest.htm

Canadian Arts Grants Cut . . . Boo Hoo!

Unbeknownst to most Canadians, $4.7 Million per year has been mostly wasted by our federal government on something called the PromArt program. This liberal slush fund has been used for such things as:

• $3,000 given to Holy Fuck, a Toronto rock band, to travel in the U.K.
• $5,000 given to former CBC broadcaster, Avi Lewis, to let the little darling go to film festivals in Australia & Argentina
• $16,500 given to Tal Bachman, a best-selling recording artist, travel to South Africa and Zimbabwe
• $3,000 given to author Gwynne Dyer, to travel to Cuba
• $18,000 given to The North South Institute, a left-wing anti-globalization "think tank", to attend an anti-Western conference in Cuba (Note: I put "think tank" in quotes because isn't a left-wing think tank an oxymoron?)

On a related note, a few years ago I received a detailed summary from a close friend of how the Canadian film industry works vs. the American film industry. Down south, people come up with project ideas and then go to private sources to get funding. But here in Canada, most filmmakers live entirely off of the public trough (that's your money and mine), figuring out assorted ways to get various grants to fund their projects. In most cases, there's absolutely no expectation that there'll ever be much public interest in their finished work, let alone making a profit. This well known con has been going on for decades.

I can only imagine the reaction from those at the CBC, who have stolen wasted consumed more public money than any other group I know of. They'll be decrying this for the next 20 years. IMHO good riddens!!! And realize that this is probably one of hundreds of government programs that are nothing other than a privileged slush fund. If recipients of such funds were to turn into pickpockets tomorrow nothing much would change in their disgusting behaviour.

Habitat for Humanity: A Few Questions

Randy Forrester is a 36 year-old lighting fabricator who earns $42,000 per year. He and his family are moving into a 3-bedroom townhouse in Burnaby valued at $325,000. Yet he only has to pay $200,000. Why? Because he got involved with Habitat for Humanity, and donated 500 hours of his time toward the building of his home.

Hmmm, if we divide $125,000 by 500, that works out to $250 per hour. Is Mr. Forrester able to bill out at that rate in the free market? I doubt it.

One can't fault Forrester for simply signing up to a program that is offered to him but why on earth is Habitat for Humanity receiving any public funds?!? Those funds are coming from your taxes and mine. They're also coming from the taxes of people who are making a lot less than $42,000 per year.

I'm convinced that the average person in society wants to help out those who are truly challenged. But is it any wonder that people get cynical when stories like this come to light?

52.6% of Americans Receive "Significant" Government Income

This article boggles my mind. It makes me wonder what percentage of Canadians are receiving similar significant amounts of income. I have to believe there'll be a tipping point beyond which those paying will refuse to any longer.