Archive for July, 2009

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Cartoon: Sotomayor, Judicial Activism

July 29, 2009

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Corruption: Billions To Timulate Criminality

July 28, 2009

Billions To Stimulate Criminality

IBD: 24 July 2009

Corruption: A nonprofit group committing a crime conjures up images of terrorist fundraising. But $8.5 billion in taxpayer money may go to specialists in political terror: the tax-exempt scam artists of Acorn.

Did Democrats come to their present dominance of both ends of Pennsylvania Avenue in Washington thanks in large part to a “syndicate of tax-exempt organizations” that “has coordinated and implemented a nationwide strategy of tax fraud, racketeering, money-laundering and manipulating the American electorate”?

The reams of evidence provided by House Oversight and Government Reform Committee ranking Republican Darrell Issa of California and his GOP colleagues on the panel strongly suggest so.

… (Acorn) uses “a complex structure designed to conceal illegal activities” — 361 different entities in 120 cities, 43 states and the District of Columbia, amounting to a “shell game” that “diverts taxpayer and tax-exempt monies into partisan political activities.”

The group has over the last 15 years received in excess of $53 million in federal funds. Moreover, as the report warns, “under the Obama administration, Acorn stands to receive a whopping $8.5 billion in available stimulus funds.”

Acorn’s improprieties, of course, are not news. As Issa’s report notes, a third of the 1.3 million voter registration cards the organization solicited and presented in 2008 ended up being null and void; the group has been investigated for voter registration fraud in places such as Connecticut, Missouri, Nevada, North Carolina and Ohio.

A decade ago, an Acorn operative in Arkansas was arrested for falsification of voter registration forms. Soon after that, Philadelphia officials discovered hundreds of Acorn’s falsified registration forms. In 2007, the state of Washington filed felony charges against several Acorn employees and supervisors for submitting more than 1,700 fraudulent voter cards.

Just last fall, federal agents raided Acorn’s Nevada offices and in May of this year Nevada officials charged the organization and its state personnel with voter fraud. That was soon followed by seven Acorn officials in Pittsburgh being charged with voter fraud. Acorn has been accused of presenting at least 2,100 fraudulent registration forms in Lake County, Ind.

Superimposed upon these offenses are the alleged embezzlement practices of Dale Rathke, brother of the organization’s founder, Wade Rathke, who apparently used a financial management company to “loan” himself over $948,600 in Acorn funds.

For eight years after the incident, Acorn kept him in its employ and failed to notify its board of the money grab. Acorn board members Marcel Reid and Karen Inman were actually kicked off for trying to investigate the Dale Rathke cover-up, and for seeking financial transparency within Acorn.

Inman’s response to her removal last fall was to ask: “Why would you want us not to clean up things? Why would you not want to do your own investigation instead of bringing in the sheriff?”

Perhaps because a cleaned-up Acorn would not be able to operate effectively. Even the left-friendly National Public Radio has reported that the organization’s financial sleight of hand “essentially gives them a cloak that prevents people from seeing really how they’re spending money that comes, in some cases, from the taxpayers, in other cases, comes from members of their organization who pay dues.”

Yet this corrupt outfit has actually been signed up as a national partner with the U.S. Census Bureau to help recruit the nearly 1.5 million workers who will count and classify our 306 million population for 2010. It’s like getting a car thief to manage a parking garage.

As the Capital Research Center’s Matthew Vadum has documented, $3 billion from the stimulus package, another billion dollars from HUD, and $4.5 billion in Community Development Block Grants look set to come Acorn’s way for a total of $8.5 billion.

The Issa report further charges Acorn with submitting false filings to the IRS and the Labor Department, and violating the Fair Labor Standards Act and the ERISA law.

Amidst all this apparent illegality, the campaigns of President Obama, disgraced ex-Illinois Gov. Rod Blagojevich, and Sen. Sherrod Brown, D-Ohio, are among the beneficiaries of financial contributions from Acorn and its affiliates.

“These actions are a clear violation of numerous tax and election laws,” the Issa report charges.

Issa called it “outrageous that Acorn will be rewarded for its criminal acts by taxpayer money in the stimulus and is being asked to help with the U.S. census.” He says the organization “cannot and should not be trusted with taxpayer dollars.”

Don’t hold your breath for justice. No doubt Attorney General Eric Holder will soon be too busy hounding former Vice President Dick Cheney — for his forceful effort in waging the global war on terror — to probe the shady outfit that helped elect his boss president.


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Leadership(?): Barack Hussein Obama

July 28, 2009

This Is Post-Racial?

IBD 24 July 2009

Leadership: Barack Obama promised a new “post-racialism.” But when a black pal was arrested by a white policeman for disorderly conduct, the president’s response was pure old race politics. So which is it?

During a press conference otherwise devoted to health care, the president on Wednesday interjected himself into a local police matter when he addressed the arrest of his friend Henry Louis Gates, a Harvard professor who got himself into an altercation with a Cambridge, Mass., cop on July 16.

Seems the cop, Sgt. James Crowley, had the cheek to ask Gates for identification during a routine burglary investigation.

That made the professor so angry that he hurled charges of racism, screamed outrage that Crowley didn’t know who he was, warned the cop not to “mess” with him and then created enough of a public disturbance to get himself arrested. The whole matter proved to be an embarrassment for all, and the city later dropped the charges.

But instead of admitting the most-likely truth — that his friend had made a fool of himself hollering racism over a legitimate police inquiry and let his academic ego get the better of him — Obama moved unexpectedly into the crudities of race-baiting, even after admitting he didn’t have all the facts.

“Now, I don’t know, not having been there and not seeing all the facts, what role race played in that, but I think it’s fair to say, number one, any of us would be pretty angry; number two, that the Cambridge police acted stupidly in arresting somebody when there was already proof that they were in their own home; and number three, what I think we know separate and apart from this incident is that there is a long history in this country of African-Americans and Latinos being stopped by law enforcement disproportionately. That’s just a fact.”

This fits nicely with the stereotype perpetuated at places like Harvard — that of white working-class cops going around rousting innocent blacks to preserve a white power structure.

But if that stereotype was ever true, it was before black mayors, black police chiefs, community organizing, sensitivity training and large university endowments for scholars such as Gates.

(It came out Thursday that Crowley himself is a police academy expert on racial profiling, having been handpicked for the job by a former police commissioner who is black and who says he has “nothing but respect for him as a police officer.”)

It was also before the rise of professional race-baiters such as the Rev. Al Sharpton, who use racism allegations to make political hay.

The election of Barack Obama was supposed to get us beyond grievance politics, reparations and all the things that create pointless conflict. Sadly, the president didn’t rise to the task in this case.

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Cartoons: Healthcare

July 28, 2009

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Health Reform: A Tough Sell Without Magic

July 28, 2009

Health Reform: A Tough Sell Without Magic

By THOMAS SOWELL IBD 24 July 2009

Distracting the audience’s attention is one of the ways magicians pull off some of their tricks. President Obama’s televised news conference on medical care shows that he is something of a magician when it comes to politics.

The big trick for the president is to convince the public he can add tens of millions of people to his government medical insurance plan without raising the costs.

But an analysis by the Congressional Budget Office showed that ObamaCare would in fact raise the costs and increase the deficit by billions of dollars.

With common sense and economic analysis saying Obama cannot expand government medical care without expanding the already runaway federal deficit, it’s quite a trick to get the public to believe otherwise — a big challenge requiring big distractions.

One of those distractions has been to blame current high costs on scapegoats whom the president can rein in. Talking about the high pay of the CEOs of pharmaceutical companies is one of those distractions.

In an industry where developing just one new pharmaceutical drug can cost a billion dollars, what the CEO makes doesn’t matter. The head of a megabillion-dollar pharmaceutical company can be paid a million dollars a year, 20 million dollars or work free of charge; that won’t raise or lower the cost of the medicine you buy by one dollar.

If making the CEO’s pay an issue can distract your attention from the impossible math used by Obama and his supporters, that’s a trick worthy of Houdini.

Insurance companies are another distraction and a scapegoat because they do not insure “pre-existing conditions.” Stop and think about it: If you could wait until you got sick to take out health insurance, why would you buy that insurance while you are well?

You could avoid paying all those premiums and then — after you got sick — take out health insurance and let the premiums paid by other people pay for your medical treatment.

That is not “bringing down the cost of health care.” It is sticking somebody else with paying those costs. So is taxing “the rich.” So is passing on those costs to your children and grandchildren through government deficit spending.

When Obama makes the insurance companies the villains for not insuring pre-existing conditions, that gives him another distraction and enables him to be another escape artist, like Houdini.

What is the point of government-controlled medical care if it is not going to lower costs but just shuffle them around, like a shell game?

The government does not have some magic wand that can “bring down the cost of health care.” It can buy a smaller quantity or lower quality of medical care, as other countries with government-run medical care do.

It can decide not to spend as much money on the elderly as is being spent now. That can save a lot of money — if you think having a parent die earlier is a bargain.

The idea of a “duty to die” has been making some headway in recent years around the fringes of the left. It is perfectly consistent with the fundamental notion of the left, that decisions should be transferred from ordinary citizens to government elites.

Liberals don’t have to advocate it. But once you have bureaucrats empowered to decide what treatments you can get, they may well decide that money spent keeping some 75-year-old grandmother alive for a few more years could be better spent politically by enabling 10 younger people to have acupuncture or visit a shrink.

Even if her children or grandchildren are willing to spend their own money to keep grandma alive, when bureaucrats control the necessary technology or medication they may decide that it’s not for sale.

Those pushing for government-controlled medical care say you can keep your doctor. But bureaucrats in Washington will decide whether what your doctor prescribes will be allowed.

Talking about your doctor is another distraction from the crucial question of who will have the power to decide, which can be the power of life and death.

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Healthcare: Specifics, Please

July 28, 2009

Specifics, Please

IBD: 24 July 2009

Health Care: From the president we now know that cops are stupid, doctors are greedy, Republicans don’t play nice, people are dying and we’re all going broke if we don’t embrace socialized medicine in a week or so.

Everything, in other words, but what Wednesday’s press conference was supposed to be about: the health care reforms the president and his party want voted on by the time Congress breaks for another vacation.

Sure, we heard a lot of wonkish rhetoric — this president seems to think all he has to do is talk, and everyone will bend to his will — but there were few specifics.

And a few specifics would be nice before we place our health care system — 17% of the economy — under government control.

We didn’t even hear the president explain how he could demand immediate action on bills that he himself hasn’t read. (But then, to be fair, the somnambulant journalists in attendance didn’t bother to ask.)

This became obvious Monday, when he was asked about a point we brought up in an editorial last week on whether the House bill in effect outlaws new private individual health care insurance the year it becomes law.

“You know,” Obama told a group of hand-selected, sympathetic bloggers, “I have to say that I am not familiar with the provision you are talking about.”

Obama isn’t the only one who isn’t familiar with the “reform” he wants so badly. Tens of millions of other Americans are also trying to make heads or tails out of it — because it’s something that will affect each and every one of them.

Fortunately, some people are sorting through the particulars. For example, the Lewin Group, a consulting firm respected for its nonpartisan analysis of health care issues, put out another report this week that found, among other things, that:

More than 88 million Americans could lose their employer-based health coverage as businesses switch to the new taxpayer-subsidized public option that will compete with private insurers for enrollment. Doesn’t this refute the claim that we can keep our current coverage?

Yearly premiums for Americans with private coverage could rise as much as $460 per person as a result of the cost-shifting that would result from the public option. How does this jibe with the claim that costs will be lower?

Physicians’ net income would fall by 6.3%, or an average of $18,900 per doctor, as a result of lower reimbursements under the public option and higher practice expenses associated with providing services to the newly insured.

If this results in fewer doctors, what does it mean for the promise of better care, especially when 47 million more people are gaining access to the system?

These questions and many others demand answers from the president — in or out of press conferences — as well as Congress before this legislation gets any further. Because all we’re being told now is that if we cede control to Washington, we’ll get better care for more people at lower costs, and these claims just don’t add up.

One, care will be poorer as fewer doctors become overworked by the rush of newly insured patients. Two, more than 103 million Americans, the Lewin Group says, will be herded against their wishes into the government-run public option. Third, costs will keep rising because incentives to self-ration will be further weakened by a system that encourages patients to overuse it.

Until we hear some specifics that refute our reading of the legislation, we remain unconvinced that government-run health care will live up to its promise.

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Auto Industry: Something’s Smelly At GM

July 28, 2009

Something’s Smelly At GM

IBD: 24 July 2009

Bailouts: You’re a once-mighty auto company that’s been bailed out by taxpayers, taken over by government and just posted a 22% sales drop. What’s your next move? Why, unveil a new men’s fragrance, of course!

It got little attention, but GM’s decision to launch its new fragrance line in honor of Cadillac’s 100th anniversary may go down as one of the most absurd moves by a troubled corporation ever. No doubt they kept a team of highly paid MBAs busy for months with the project, while the car end of their business was imploding faster than a black hole.

Is this what we get for our money — the $51 billion we taxpayers have ponied up to bail GM out of its self-inflicted woes?

“Cadillac, the new fragrance for men,” doesn’t seem like much to start the “New” General Motors Corp. on. Likewise, it’s never good to see that, amid all the cutbacks, GM’s lobbying budget remains virtually untouched. We guess the new “Government Motors” needs the political clout.

Disappointing? You bet. The White House created a so-called “Car Czar” to oversee the auto industry. The Big Three, we were told, had been totally irresponsible and needed the government’s help and the taxpayers’ cash.

Well, so far, not so good. Just one month after the government took a 60% stake in GM, it reported its first half sales fell 22%.

Worse, its global market share fell to 12% — down from 12.3% a year ago and 14.1% in 2005. Last year, Toyota took over from GM as the world’s largest automaker, and this year GM will lose its Hummer, Saab, Saturn and Pontiac lines, becoming even smaller.

We didn’t expect an instant turnaround. But then again, we also didn’t expect to find out that men’s cologne would be part of their new product lineup.

And no, we’re not just picking on the auto industry here.

At least one major American automaker seems to be getting its act together. Ford rejected a big government bailout. How’s it doing? It posted a $2.3 billion quarterly profit in the second quarter, confounding analysts and critics alike.

“We strengthened our balance sheet, reduced cash outflows and improved our year-over-year financial results despite sharply-lower industry volumes,” said Ford Chief Financial Officer Lewis Booth.

And it’s not as if GM has nothing going for it. Quite the contrary.

For one, GM’s newly reissued Camaro is a big hit.

Orders are literally running faster than production right now, forcing those who want a Camaro right away to pay more than the sticker price to get one.

And sales are booming — overseas. GM recently announced that its sales rose 38% in China in the first half, while setting sales records in seven Latin American countries during the same time. GM in the first half sold almost as many cars in China (814,442) as it did in the U.S. ( 947,518). Its share of Europe’s market is growing.

This underscores why GM should have been allowed to undergo a normal bankruptcy — not the politically rigged one that the government forced down all of our throats.

Today, GM might not exist, it’s true, if forced into a regular bankruptcy court. Its assets would have been sliced and diced to pay off its creditors. But those assets would live on. What automaker wouldn’t want to have the Camaro in its stable right now?

A regular bankruptcy would have given GM bondholders first call on its assets. Instead, they literally had money stolen from them.

More importantly, GM could have dumped its most onerous labor contracts with the United Auto Workers, while focusing on truly profitable cars. As it is, the UAW ended up with a major ownership stake in GM at the expense of its creditors and taxpayers.

GM exited bankruptcy on July 10. Today, what’s left after that politicized union-friendly travesty is two GMs.

One is the sickly domestic GM, which still has enormously costly labor contracts that give it roughly a $2,000 per car disadvantage when competing against the 12 foreign companies that make cars here. This GM can’t make money — especially now that government bureaucrats and union leaders are, in part, calling the shots.

Then there’s the other GM, the viable one. It posted big sales gains in foreign markets in the second half, and is the one part of GM that could not only survive, but thrive.

If GM manages to make it, it won’t be because of the taxpayer bailout. It will be because people elsewhere still want to buy its cars.

We hope GM can survive in the U.S. But we rather doubt it can with a management that thinks that perfume will cover up the stink of political meddling and the lingering bad odor of its ruinous retirement and health care costs.