Monday, July 9, 2012

Quick Hits - July 8 and 9, 2012

A QH doubleheader today...

Remember this?

That is then candidate Barack Obama promising 5 days before Election Day 2008 to 'fundamentally change' the United States.  According to a poll by The Hill, this is one of the promises made by the President that he has managed to keep.

Asking if President Obama has changed the country, over two-thirds (68%) of the responders, agreed that the President had changed the country.  Unfortunately for the President, 56% of these likely voters believe that the President and his policies have the changed the country for the worse, including 1 in 5 Democrats, as opposed to 35% who believe that he changed the country for the better.

Looking deeper into the poll, which had a sample demographics of 35% Republicans, 34% Democrat, and 31% Other, is the reflection that Republicans are more engaged with the 2012 election than they were with the 2008 election.  Could this be yet another foreshadow that 2012 is going to be far closer to 2010 in terms of turnout and enthusiasm than existed in 2008?

Still, in that poll, I do have to wonder about the 5% of self-described Republicans who believed that President Obama changed the country for the better....

The weekend news programs featured a lot of discussion about last Friday's June job report - which reflected a below expectations net job growth of 80,000 jobs and that more people were added to the federal government's disability program in June than were jobs created (85,000).  One of the one's leaping to the President's defense was the vapid Chair of the Democrat National Committee, Debbie Wasserman-Schultz, who touted the President's job record...

Today, we have 5 million fewer Americans working today than in January 2009. If the BLS used the same labor participation rate (today at its lowest level in 30 years) as in January, our 'real' unemployment rate would be 10.9% - and today's underemployment rate is now 14.9%. 20+ consecutive months of adding jobs means very little - and only serves to smokescreen the fact that in the last quarter, job creation failed to maintain pace with our population growth - let alone hit the promised target of >4% GDP growth and 5.6% unemployment if the country invested in a $850 billion stimulus and embarked on three (soon to be four) consecutive years of deficits over $1.2 trillion.

In his latest deflection, President Obama today called for a ONE YEAR extension of the 2001 / 2003 tax cuts only for those earning under $250,000 per year.  The 2001 / 2003 tax cuts are currently scheduled to expire on 'Taxmageddon' - January 1, 2013.  The President is pushing this as part of the latest 'pro-middle class' meme of his campaign - and to put pressure on the GOP who seek to the make the 2001 / 2003 tax cuts permanent.

This isn't the first pass through for this idea from the President - he also proposed a similar approach in 2010 which ran into a buzz saw of challenges from Congressional Democrats as well as from Congressional Republicans.  House Minority Leader Pelosi (D-Haight Ashbury) and very liberal NY Senator Chuck Schumer want the threshold for the income level to be $1 million a year as opposed to $250,000, while other Democrat Senators, including 4 facing re-election in the fall, either want a higher income threshold or the cuts made permanent.

Left unaddressed, however, remain the other aspects of the 2001 / 2003 tax cuts which are expiring.  These, if unaddressed, would more than double the Capital Gains and Dividend tax rates, while moving the estate tax rate from 0% to 45%.  Also left unaddressed, is that raising taxes on individuals earning over $250,000 per year is also going to hit over 900,000 small businesses - all in a time when the national economy is sliding backwards - not moving forward.

Hot Air notes this about the President's tax 'plan' -
A one-year extension won’t convince middle-class earners to invest their money or take more risks. All it will do is confirm that Obama plans to hike taxes on the middle class in a second term. If not, why propose a one-year extension rather than proposing making the Bush-era rates on those earners permanent? 
Obama is indeed out of ideas. Now he’s giving us reruns of his greatest … misses.

Last week, I noted that the U.S. Government, which still owns about 32% of GM, has a loss of about $35 billion of taxpayer funds on their bailout of the troubled automaker. Over the weekend, GM, boasted of increased sales in the month of June - and now we know the reasons why... The Federal government increased it's purchases of GM cars by 79% during the month.

As with most items, there is a little more to the story than just this...
The upcoming earnings announcement by GM is, politically, the most important to date. The pressure is on Government Motors to appear financially strong as this may be the last earnings report before November elections and sets the stage for how "successful" GM is. One of GM's past tricks to help fudge earnings numbers has been to stuff truck inventory channels. Old habits die hard at GM. According to a Bloomberg report, "GM said inventory of its full-size pickups, which will be refreshed next year, climbed to 238,194 at the end of June, a 135 days supply, up from 116 days at the end of May." 135 days supply is huge, the accepted norm is a 60 day supply. The trick here is that GM records revenue when vehicles go into dealership inventories, not when actually sold to consumers.

Keep this in mind as we move to this piece on the President's two day bus campaign tour through Western Pennsylvania and Ohio...
Obama’s message on his two-day bus tour through Ohio and Pennsylvania has been twofold. First, he pointed to modest signs of progress in rebuilding the economy–the health of the auto industry is his principal case study across Ohio’s northern tier. At the same time, he warned that the medicine offered by Romney and the Republicans is exactly the wrong prescription.

As he said here Friday morning, “We tried it, and didn’t work.”

But it has become increasingly difficult for the president to argue that what he has tried is working well, or that he has something new to offer. Each month that the economy produces fewer jobs than are needed just to keep pace with population growth adds to the burden the president faces as the clock ticks toward November.

This is a President who is out of ideas and is in real trouble for the November election. Candidates do not campaign in 'safe areas' - they campaign in the battleground areas. Blue collar Western Pennsylvania and the parts of Ohio where Obama campaigned in are normally reliable Democrat strongholds. These areas voted for Walter Mondale over Ronald Reagan in 1984. But the President is having some real problems in these areas because of the economy and his own words which highlight the effects of his economic policies from 2009, 'We tried it, and it didn't work'.

Even in his 'new' tax proposal - there is nothing really new about it.  It's virtually the same plan that never made it through the Democrat majority Senate in 2010, and one that does little to instill confidence or promote economic growth - as January 1, 2013 will still see a massive hike in corporate, capital gains, and dividend tax rates.

This weekend also saw another deflection by the Obama campaign to focus attention on something other than the dismal economy - this one again involving the Obama campaign / mainstream media partnership.  Obama campaign senior adviser David Axelrod took to Twitter to accuse Mitt Romney of being the 'most secretive candidate since Richard Nixon', while Vanity Fair, the Washington Post, and the DNC dimbulb Debbie Wasserman-Schultz attacked Romney's alleged secret hidden accounts in Bermuda and Switzerland - calling for the candidate to release more than just one year's tax return.

John Hinderaker at Powerline highlights the hypocrisy and projection underway in this latest attack on the presumptive GOP Presidential candidate - particularly since there is so much from Barack Obama that remains unreleased and secret - like his college and law school records, his medical records (which Hinderaker focuses on and calls a far bigger issue than the school records).

One is left thinking that if it were not for their double standards, liberals would not have any standards.

Another sign of trouble for the Obama campaign? For the second straight month, the Romney campaign outraised the Obama campaign. In May, Romney raised $16 million more than the President. In June, the Romney campaign raised $106.1 million - $35 million more than the President's campaign.

The President will 'celebrate' by holding two $40,000 a head fundraisers, number 173 and 174 since he filed to launch his reelection campaign 15 months ago - and more fundraisers than the previous 5 incumbent President's had undertaken, combined, through this point of their reelection campaign.

Hot Air notes today a study that shows that Maryland's increases in income taxes on just the wealthy has not only driven out many of the wealthy from the state, but also cost it $1.7 billion in lost tax revenues.
The study, by the anti-tax group Change Maryland, says that a net 31,000 residents left the state between 2007 and 2010, the tenure of a “millionaire’s tax” pushed through by Gov. Martin O’Malley. The tax, which expired in 2010, in imposed a rate of 6.25 percent on incomes of more than $1 million a year.

The Change Maryland study found that the tax cost Maryland $1.7 billion in lost tax revenues. A county-by-county analysis by Change Maryland also found that the state’s wealthiest counties also had some of the largest population outflows.

In total, Maryland has added 24 new taxes or fees in recent years, Change Maryland says. Florida, which has no income-tax, has been a large recipient of Maryland’s exiled wealthy.

Here in the very progressive dominated state of California, we've also seen similar effects as taxes have increased and the government has taken a decidedly anti-business approach to how it conducts business. As I've mentioned in the past, this is a state that has a $16 billion budget deficit - up from a $9 billion deficit in January. Not only are tax revenues in the state down because of the economic effects, but the state is spending $2 to $4 billion more than budgeted in its general operations. In this, our government is now committing to build a $64 billion to $100 billion high speed rail network that lacks a realistic or viable business plan.

On top of this, we're also being asked to approve via vote in November, $7 billion in new taxes - supposedly geared towards the 'wealthy' - with an increase from the top rate of 10.3% to as high as 13.3% for those earning more than $1 million a year. But there's a nasty little secret in California's tax system. The breakpoint just before hitting the $250,000 'wealthy' level starts at just $48,500 of income. Earn this amount, or more, and your California income tax rate is 9.3% - an amount that is higher than the maximum income tax rate in 47 states.

In Egypt, the political crisis between the newly elected Islamist President, Mohamed Morsi, and the current ruling Military Council, escalated as Morsi issued a decree invalidating the ruling of the Supreme Constitutional Court invalidated and dissolved the Islamist dominated Egyptian Parliament and called it back into session. The Court responded today by standing on its previous ruling and calling Morsi's decree invalid.

This comes after the Military Council also drastically reduced the power of the office of President. The Muslim Brotherhood, the party of Morsi, has been warning of a popular uprising against the military leadership if they continue down this path.

If there were any remaining doubts about the United Nations being an irrelevant and feckless organization - this should eliminate them...

Syria is set to win a seat on the UN Human Rights Council...this as its government has waged a brutal crackdown against civilians opposing the Assad dictatorship in fighting that has killed nearly 17,000 in the past 15 months. The only thing stranger would be the UN adding Iran to a Arms Control group....which is also happening.

It seems China has set it's sights on more than just territory that belongs to Vietnam and the Philippines - as it apparently has just annexed the DPRK - North Korea.
A report indicates that China has told South Korea that it will not allow the unification of North and South Korea under a democratic government. North Korea will remain under Chinese "influence." If necessary China will send in troops to set up a North Korean government that will faithfully follow orders from China. In an effort to dampen some of the anger in South Korea, the United States, and Japan, China would maintain North Korea as a separate entity, and not a new province of China. China wants no misunderstanding about who "owns" North Korea.

On Sunday, the entertainment world lost a talented and hard working actor as Ernest Borgnine passed away at the age of 95.

He had a long career ranging from his Oscar winning role in 'Marty' to becoming known to kids under the age of 12 as the voice of 'Mermaid Man' on SpongeBob. He was also a 10 year Navy vet, joining up in 1935. A few years ago, he said this about his career and his drive to keep working...
"I just want to do more work," he said. "Every time I step in front of a camera I feel young again. I really do. It keeps your mind active and it keeps you going."

At this link is a list of his best known films and roles.

Thanks for the decades of entertainment you provided. RIP.

Finally, if you need a secret new lair for your base to take over the world, Norway is selling one of it's secret submarine bases.
Another bit of Cold War surplus has just come on the market. Norway is selling one of its underground submarine bases, for $17.5 million. Located outside the city of Tromso, next to highway E8, the former Olavsvern Naval Base is basically a water level tunnel dug into a mountain at the mouth of a fjord (one of the many deep water channels that give the Norwegian coastline that heavily indented look). The tunnel can dock small warships or a submarine and has 25,000 square meters (269,000 square feet) of underground space. There are several tunnels down there, most of them dry. The above ground structures contain 13,500 square meters (145,000 square feet) of space.

The base is half a century old and was originally built at a cost of several hundred million dollars. Its industrial grade space that hasn't been used by anyone since the military moved out a decade ago. An adventurous, and wealthy, buyer is being sought.

Today in History


1776 - The Liberty Bell rings out from the tower of the Pennsylvania State House (now Independence Hall) to summon citizens for the first public reading of the Declaration of Independence.

1853 - Commodore Matthew Perry, representing the U.S. Government and leading a squadron of 4 warships, sails into Tokyo Bay, Japan to establish relations with the Japanese government which had closed the country to foreigners two centuries earlier.

1889 - The Wall Street Journal publishes its first issue.

1947 - Demolition begins in the Turtle Bay section of Manhattan, NYC, for the construction of the new permanent headquarters for the United Nations.

1959 - 2 American advisers to South Vietnam become the first American soldiers killed in the American phase of the Vietnam War when guerrillas strike a Military Assistance Advisory Group base 20 miles outside of Saigon.

1994 - Kim Il Sung, the communist dictator who founded the DPRK (North Korea) in 1948, dies at the age of 82.

1997 - NATO invites Poland, Hungary, and the Czech Republic to join the alliance in 1999.


1816 - Argentina declares its independence from Spain.

1868 - The 14th Amendment to the U.S. Constitution is ratified.

1877 - The Wimbledon tennis tournament begins.

1993 - British forensic scientists announce they have positively identified the remains of Russia's last Czar, Nicholas II, his wife, Czarina Alexandra, and three of their daughters, Anastasia, Tatiana, and Olga.  Missing were the remains of son, Alexi, and daughter Maria.  The entire Russian Royal Family had been executed in July 1918 by the Communists after they seized power.  In 2007, the remains of Alexi and Maria were found, and identified in 2008 via DNA testing.

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