Back to Basics

This reads like something that could have found its way into the scripts for Dr. Strangelove or M*A*S*H: Government Issues Study of a Study About Studies:

The Pentagon was inundated with so many studies in 2010 that it commissioned a study to determine how much it cost to produce all those studies.

Now the Government Accountability Office has reviewed the Pentagon’s study and concluded in a report this week that it’s a flop.

The study of a study of studies began in 2010 when Defense Secretary Robert Gates complained that his department was “awash in taskings for reports and studies.” He wanted to know how much they cost.

Two years later, the Pentagon review is still continuing, which prompted Congress to ask the GAO to look over the Pentagon’s shoulder. What they found lacked military precision.

The study, which studies the cost of studies that review the effectiveness of other studies, is entitled Actions Needed to Evaluate the Impact of Efforts to Estimate Costs of Reports and Studies and can be viewed here.

After the study about the study of studies is finalized, the study is to be delivered to the Armed Services Committee, who are in the study… studying.

You’ve probably seen the headlines – the J.O.B.S. bill passed in the Senate.

So that means more “jobs” in the American economy, right?

As President Obama and a large portion of the Congress run for re-election, Washington is obsessed with this rather illusory concept of “job creation.”  And the “J.O.B.S.” Act, named with an acronym that stands for “Jumpstart Our Business Startups,” is the latest legislative effort to stimulate business startups, and thus, to entice job creation.

The bill actually resembles a hodgepodge of several different legislative agendas.  And even if the bill accomplishes what its supporters claim, it is probably still several steps removed from actual “job creation.”  It may also be yet another governmental wet blanket thrown on top of an economy that is ready to catch fire.

But before I get in to these latest details, let’s consider what Washington has been doing to “create jobs” over the past few years.

In February of 2009, the federal economic “stimulus” bill became law.  It cost us over $850 billion, and it was promised that, as long as the bill passed, the national unemployment rate would not rise above 8%.

Well, the unemployment rate rose well above 8% after the bill’s passage, and it still has still not dropped below that mark.  One can argue that the bill was necessary at the time – or not – to prevent further erosion in the economy.  But there would seem to be fewer “jobs” in the American economy, in the aftermath of this big Washington spending binge.

Then in 2010, there was the monumental healthcare reform bill.  This bill was sold as a means of curtailing healthcare costs, making healthcare “universal,” and, as the President noted, it would prevent the government itself from “going bankrupt.”

It was also sold as a job creation bill.  Former Speaker of the House Nancy Pelosi claimed right before the bill’s passage that  it would create 4 million jobs – “400,000 jobs almost immediately.” Since it became law 2 years ago, healthcare costs have skyrocketed, private sector employers have dropped health coverage for some 1-2 million workers, and 400,000 new jobs have yet to be created.

My point here is that our federal government has spent untold amounts of our scarce tax dollars in the name of “creating jobs,” with little or nothing to show for it.  Given this, we should all approach the new “J.O.B.S. bill” with a healthy dose of skepticism.  Politicians have a built-in incentive to appear as though they’re doing things that make our lives wonderful.  But just because they claim to be doing great things,  doesn’t mean that they are.

As for the new “J.O.B.S. bill,” a version in the Senate passed, but now it goes to the House of Representatives for amending, and a vote.

One of the claims about this bill is that it would expand a phenomenon known as “crowd funding.”  As writer Catherine Clifford noted at Entrepreneur.com, the bill seeks to make it “easier for startups to raise small amounts of money from large pools of investors” by utilizing this burgeoning mechanism for funding.

But this great effort on behalf of the U.S. Senate raises an important question:  does the process of crowd funding need help from the government?

“We Can’t Wait!”

Barack Obama often seems annoyed by the limitations of his office these days, especially with a Congress that occasionally disagrees with him.

So rather than let something silly like the co-equal branches of government get in the way, the President has chosen instead to harness the mantra “We Can’t Wait!” (do an online search with the mantra and his name), and then impose his controls over our economy by executive mandates.

With an unending supply of programs to stimulate everything from domestic tourism to farm production, President Obama has huge chunks of the American economy firmly within his grasp. 4 years ago this kind of government control seemed like a good idea to some, but who still thinks that way now?

I remember back in the fall of 2008 when I attended an Obama campaign “meet up” at a bar. It was in Phoenix, Arizona – the home of Mr. Obama’s opponent at that time, John McCain, and home to a brutal real estate crash – and a mortgage lender friend told me “you gotta come meet these people. They’re young, hip, smart, lots of MBA’s and lawyers, and they’re all supporting Obama.”

What I observed as I mingled with the young, hip, smart people was that they liked to talk about how young and hip and smart they believed Barack Obama to be. They’re confidence in this one man was unending, while specific details about economic and public policy concerns weren’t discussed much.

“Why did so many banks and borrowers agree to ARM loans in the first place?” I asked one of the hipsters, trying to engage a discussion about how bad government policy can incentivize bad consumer behavior. “Obama will implement a program to stop the foreclosures” was all the answer I could get.

“Why do healthcare insurers continue to raise their rates?” I asked another hipster, hoping we could talk about the ways in which government policy prevents competition among insurance companies. “Obama has a plan to expand coverage and reduce premiums” I was told. End of discussion.

That was in 2008. Now, after nearly three and a half years of President Obama’s all-seeing and all-knowing wisdom forcing private companies and individuals to do what he wants them to do, we should pause and ask ourselves: does more government control over our economy produce more prosperity for us all?”

The President and his supporters like to pretend that anything short of Obama’s controls over the economy is tantamount to no government regulation at all. “We can’t go back” the President has said, suggesting that before he became our ruler, banks and insurance companies and oil corporations were completely unregulated.

This, of course, is false. Our economy is heavily regulated, and while some regulations are necessary and helpful, others are not. Federal law, for example, forbids health insurance providers from competing with each other across state lines; it forbids oil corporations from developing petroleum energy throughout much of the U.S.; and federal banking policy – much of which emanated from Fannie Mae and Freddie Mac – incentivized reckless borrowing and lending during the last decade.

You know the old saying about how figures lie and liars figure? Well, it might as well become our national motto as far as I am concerned. When it comes to presenting numbers I am always wary when either a percentage or an actual number is given, but not both. I have seen it often enough to justify my hesitation. The way it works is the least offensive and shocking of the two is used to put as happy of a face on things or prove a point that seems silly when taken in actual context.

For example, maybe I hear that a baby crib is dangerous and needs to be recalled because six kids got their heads caught between the rails. How horrible! What a poorly designed product! Hang the malicious designers of this evil product up by their toenails! Oh, wait, there are over a million of said cribs in existence? Just 0.0006% of kids who sleep in this product get their heads stuck? Hey, I do not know about you, but I do not demand perfection. And the later tells me that, honestly, there is nothing wrong other than some kids with really small heads whose parents should be a little more careful and aware.

Now, let’s look at Kevin Concannon, undersecretary for food, nutrition and consumer services at the U.S. Department of Agriculture. Mr. Concannon actually stood before Congress and crowed about how good of a job the federal food stamp program was doing. His rationale was that the program’s rate of fraud standing at 1% [1] was, “one of the best records among federal programs.” [2]. However, with approximately 1 in 7 Americans on food stamps, 46.5 million [3], one percent does not sound as good as you might think it does. One percent of 46.5 million is 465,000 cases of fraud every year. And that is for just one federal program.

Of course, saying that fraud in the food stamp program stands at 465,000 cases per year is more shocking than saying “1%”, so the government opts for the less shocking and later measure to report their “success”. The government also crows about how well it is doing in weeding out food stamp fraud. It tells us all about how much fraud is dropping like how it was 9.86% in 1999 and 6.63% in 2003 [4]. But what the mouth pieces of the government forget to mention is that over time, despite some dips, the number of Americans on food stamps has increased. For example, in 1970 about 1 in 50 Americans were on the program. Let’s look at those numbers now. In 1970 there were 203.4 millions Americans [5]. That means about four million people were on the program then and it would take a fraud rate of 11% to match the amount of fraud, by number of cases, not total dollars, today.

Furthermore, with a fraud rate of 465,000 every month, and an average of $133 per month [6] paid per participant, it means we are flushing $742,140,000 down the drain every year. That is a lot of money, no matter how hard you try to spin it. It is $742,140,000 borrowed from our great grandchildren so that we can give money to people who are scamming the system.

Ugh. We’re back to this again. Yes, President Obama’s re-inflating the housing bubble to pander in an election year. Foreclosure avoidance is now a civil right. Long-term consequences be damned.

Obama is outlining a proposal to allow millions more homeowners to refinance their mortgages at lower interest rates even if they owe more than their homes are worth. The White House says the average borrower could save about $3,000 annually.

His first mortgage-mod program was fraud-ridden and failed. So, of course, he’s doubling down.

Obama has also promised today to send a homeowner “bill of rights” to Congress.

Maybe he should try abiding by the original one first.

***

Over the past several years, I’ve written extensively about the bipartisan housing entitlement culture and the death of the stigma of default. I repeat:

Property-value preservation is not a civil right.

The truth is: Nobody wants to swallow tough truths. They just want their candy.

“Too big to fail.”

Americans have come to loath the idea that some business enterprises are so important and so “big,” that they can’t be allowed to fail – especially as it regards large corporations that “need” government bailouts.  But have we developed a similar disdain for government programs that are treated as though they can’t possibly be failures?

After last week’s State of the Union Address and Republican presidential debate, one might think that the issue of “more or less government” in our lives is merely another consumer choice – kind of like Coke or Pepsi, McDonalds or Burger King. For example, as he recently reviewed America’s debate over President Obama’s government healthcare law, Columnist Carl M. Cannon characterized the battle this way:

“To liberals, the Affordable Care Act of 2010 is a step toward ensuring improvements in health benefits, lower costs, higher quality care, economic security and fiscal sanity. Republicans, who invariably call it “Obamacare,” almost universally describe it as costly, intrusive, economically disastrous — and a violation of the Commerce Clause of the Constitution.”

In reality, the choices we make for our nation’s public policy are not all of equal merit – some can enhance our freedoms and our quality of life, while others clearly make matters worse. And many government programs that are intended to “solve” problems – most of which come from Democrats, but far too many of which come from Republicans – often times make matters worse.

It’s difficult to argue that President Obama’s healthcare reform law has solved any problems at all (notice that he’s not campaigning on the law’s success, but rather, on an agenda to protect it – “we can’t go back” he often notes). But let’s consider another signature program that the President has championed these past three years – his “Making Home Affordable” mortgage rescue initiatives.

Protecting one from losing their home may have seemed like an act of compassion.  But in 2009, it became a matter of federal policy as the government intervened to try to curtail foreclosures.

In March of that year, President Obama introduced the set of federal policies budgeted to cost $75 billion in TARP funds, and which were intended to help make it “easier” for homeowners to remain in their homes and to continue paying on their mortgages.

The effort itself was complex and was formulated with both federal guidelines, and guidelines to be established by each of the individual fifty states. The effort also proved to be so confusing that about six months after the its inception, FreddieMac (one of the lenders that was offering the so-called “affordability assistance” to some of its borrowers) actually hired a private firm to send trained professionals door-to-door in certain regions of the country to explain to homeowners how the program worked.

The objective of “Making Home Affordable”—reducing monthly mortgage bills so borrowers would presumably keep paying on their mortgages—was to be accomplished on a case-by-case basis, and by a variety of means. Among the optional procedures were: lowering the interest rate of the loan (to as low as 2 percent in some cases); reducing the principle on the loan; and extending the term of the loan, in some cases to a maximum of forty years.

It’s the stimulus that just keeps on giving! Passed in the 2009 stimulus in a world of “we have to pass the bill so you can find out what is in it”, the feds have taken one step further in the invasion of privacy of our children. Shared by freshman Rep. Ben Quayle (AZ), the question is what, if anything, is the new House going to do about it?

How the feds are tracking your kid

By EMMETT MCGROARTY & JANE ROBBINS (New York Post)

Last Updated: 12:13 AM, December 28, 2011

Under regulations the Obama Department of Education released this month, these scenarios could become reality. The department has taken a giant step toward creating a de facto national student database that will track students by their personal information from preschool through career. Although current federal law prohibits this, the department decided to ignore Congress and, in effect, rewrite the law. Student privacy and parental authority will suffer.

How did it happen?
Read more: http://www.nypost.com/p/news/opinion/opedcolumnists/how_the_feds_are_tracking_your_kid_xC6wecT8ZidCAzfqegB6hL#ixzz1hqf2Blu0

Michelle Obama’s Unsavory School Lunch Flop
by Michelle Malkin
Creators Syndicate
Copyright 2011

The road to gastric hell is paved with first lady Michelle Obama’s Nanny State intentions. Don’t take my word for it. School kids in Los Angeles have blown the whistle on the east wing chef-in-chief’s healthy lunch diktats. Get your Pepto Bismol ready. The taste of government waste is indigestion-inducing.

According to a weekend report by the Los Angeles Times, the city’s “trailblazing introduction of healthful school lunches has been a flop.” In response to the public hectoring and financial inducement of Mrs. Obama’s federally subsidized anti-obesity campaign, the district dropped chicken nuggets, corn dogs and flavored milk from the menu for “beef jambalaya, vegetable curry, pad Thai, lentil and brown rice cutlets, and quinoa and black-eyed pea salads.”

Sounds delectable in theory. But in practice, the initiative has been what L.A. Unified’s food services director Dennis Barrett plainly concludes is a “disaster.” While the Obama administration has showered the nation’s second-largest school district with nutrition awards, thousands of students voted with their upset tummies and abandoned the program. A forbidden-food black market — stoked not just by students, but also by teachers — is now thriving. Moreover, “(p)rincipals report massive waste, with unopened milk cartons and uneaten entrees being thrown away.”

This despite a massive increase in spending on nutritional improvements — from $2 million to $20 million alone in the last five years on fresh produce.

This despite a nearly half-billion-dollar budget shortfall and 3,000 layoffs earlier this year.

Earlier this spring, L.A. school officials acknowledged that the sprawling district is left with a whopping 21,000 uneaten meals a day, in part because the federal school lunch program “sometimes requires more food to be served than a child wants to eat.” The leftovers will now be donated to nonprofit agencies. But after the recipients hear about students’ reports of moldy noodles, undercooked meat and hard rice, one wonders how much of the “free” food will go down the hatch — or down the drain. Ahhh, savor the flavor of one-size-fits-all mandates.

There’s nothing wrong with encouraging our children to eat healthier, of course. There’s nothing wrong with well-run, locally based and parent-driven efforts. But as I’ve noted before, the federal foodie cops care much less about students’ waistlines than they do about boosting government and public union payrolls.

In a little-noticed announcement several months ago, Obama health officials declared their intention to use school lunch applications to boost government health care rolls. Never mind the privacy concerns of parents.

Big Government programs “for the children” are never about the children. If they were, you wouldn’t see Chicago public school officials banning students from bringing home-packed meals made by their own parents. In April, The Chicago Tribune reported that “unless they have a medical excuse, they must eat the food served in the cafeteria.” The bottom line? Banning homemade lunches means a fatter payday for the school and its food provider.

Remember: The unwritten mantra driving Mrs. Obama’s federal school lunch meddling and expansion is: “Cede the children, feed the state.” And the biggest beneficiaries of her efforts over the past three years have been her husband’s deep-pocketed pals at the Service Employees International Union. There are 400,000 workers who prepare and serve lunch to American schoolchildren.

Who really thinks that the government can do a better job on this? From the WSJ:

The Obama Administration is outputting job-creation proposals at Twitter-speed and ridiculing Republicans for not signing onto the whole package. Which brings us to an already up-and-running federal jobs program called USAJobs.gov. Well, up-and-running is an overstatement.

Americans in search of federal employment can go to a website called USAJobs.gov, which matches openings with applicants. Since 2004, the feds have outsourced the site’s operation to Monster.com. Good call by whoever was in charge in 2004. Monster.com is the private company that pioneered employment websites and is today the largest job search engine in the world.

But 18 months ago the “smart” Obama Office of Personnel Management decided the federal government could do a better job of running USAJobs.gov. It spent some $6 million developing a new in-house version of the site, promising to improve the job-search experience. It unveiled its creation two weeks ago. It’s a monster all right.

The volume of requests instantly crushed government servers, slowed the system and locked out thousands of applicants. Naturally, the site has a Facebook page. Naturally, the comment queue is boiling over. Examples:

“Why am I having to do the same search 3 times before anything shows up?” “Over one week now and I still haven’t received my password reset email!!” “USAJOBS WEB SITE IS A DISASTER!” “I entered Delaware and got Germany jobs and all of the Forest Service.” . . .

The guaranteed government loan program for “renewable energy” projects, a stimulus-sponsored exercise in venture socialism most famous for its ongoing Solyndra debacle and ties to investors that just happen to be Obama campaign donors, expired yesterday.

The Department of Energy didn’t let the deadline go quietly:

The Energy Department finalized Friday more than $4.7 billion in loan guarantees for four solar projects, bringing an embattled stimulus-law program aimed at financing renewable energy projects to a close.

The approvals come amid objections from House Republicans, who have alleged that the department was rushing to finalize the loan guarantees before the program expired Friday.

The best part is that each of the final round of guaranteed loan winners will also receive a complimentary slightly used whistling robot that warbles the tune Zip-a-Dee-Do-Da while the people who paid for it are on the verge of humming Yip Harburg classics.

I’m assuming that just because the new loan program has expired, that won’t prohibit any company with an existing loan to come back and ask for more. Even if they’ve already defaulted on the original amount, the Energy Secretary has proven he’s still willing to entertain the request.