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Saturday, October 31, 2009

Death by a Thousand Shalls

The analysis is rolling in for the House health care bill and the word shall appears a lot, over three thousand times.

The word "shall" - as in "must" or "required to" - appears over 3,000 times.

It's actually mentioned 3424 times. That's the quantifiable evidence of the government control in this bill. Shall is not a word that indicates choice. Instead, it indicates a mandate. Shall is used in things that citizens will now be required to do. It's also used in things the government will now be able to do, including a host of new bureaucracies.

Here's a list of some other not so nice words and how often they appear.

It's going to take some time to deconstruct this lengthy masterpiece, but as you flip through the pages of the House bill, you will notice the word "regulation" appears 181 times. "Tax" is there 214 times. "Fees," 103 times.

It's moments like this that provide yet another example of why I love numbers. All of these are quantifiable evidence of how the House health care bill forces upon us more government control, more taxes, more bureaucracies, and more costs.

Strip away the rhetoric. Strip away the nice words. What we have is a bill that gives a lot of new power in the form of 3424 shalls, all sorts of new taxes in the form 214 taxes, all sorts of new fees in the form of 103 fees, and all sorts of new regulation in the form of 181 regulations.

Breaking Scozzafava Drops out in NY 23

This news is breaking.

Republican state Assemblywoman Dierdre Scozzafava has suspended her campaign for upstate New York's 23rd Congressional seat, leaving Democratic nominee Bill Owens and Conservative Party nominee Doug Hoffman in the race that will conclude Tuesday, Fox News has confirmed.

The move comes on the heels of a new poll that showed Scozzafava had fallen behind her two competitors in a race too close.

It's a little too early to analyze the ramifications. Clearly, this is a huge blow for the Republican establishment. This is a blow to Newt Gingrich, who endorsed Scozzafava. Now, Hoffman needs to win in order for this to be a victory for the Tea Parties. If the Democrat wins this, this will merely be a loss for Republicans and a huge win for Democrats.

Council Winners

The Council winners are up. The council chairman had a terrible migraine last night and couldn't finish the voting. He did, however, make it coach hockey which makes the Watcher a Gladiator and a Warrior in my book.

Winning Council Submissions
First place with 1 2/3 points! – Joshuapundit - J Street – A Particularly Nasty Dead End To Be Avoided
Second place with 1 1/3 point – Bookworm Room - The march of the thought police
Third place with 1 point – (T*) – The Glittering Eye - Are We Promoting Our Grand Strategy?
Third place with 1 point – (T*) – Mere Rhetoric - Lefty Meme Congeals: The Real War Is In Pakistan Not Afghanistan
Fourth place with 1/3 point – Rhymes With Right - And To Think The Average Income Of American Families Dropped By 3.6%
Winning Council Submissions
First place with 2 points! – JammieWearingFool - Why Is GE Exempt From Government-Ordered Pay Cuts?
Second place with 1 1/3 point – The Augean Stables - Investigate the investigators: A time to rebuke Goldstone
Third place with 1 point – Riehl World View - Exclusive: How The NRCC Bungled NY – 23
Fourth place with 2/3 point – (T*) – Thomas Sowell at Real Clear Politics - Dismantling America
Fourth place with 2/3 point – (T*) – Daniel W. Drezner - Theory of International Politics and Zombies
Fifth place with 1/3 point – (T*) – Mercury News - Racial Skirmishes in our Own House
Fifth place with 1/3 point – (T*) – GM’s Place - Splitting: Fox News and the White House
Fifth place with 1/3 point – (T*) – The Tygrrrr Express - Why not just kill all conservatives?

The Culture of Curruption Between Michelle Malkin and Anita Moncrief II

On October 23rd, Anita Moncrief was part of a panel discussion sponsored by Accuracy in Media and C SPAN that included John Fund. The panel discussion went through a range of issues related to ACORN. Anita Moncrief had, last year, reported on corruption at both ACORN and its affiliate Project Vote. In fact, Moncrief is the person most responsible for linking ACORN to the Obama campaign in activities that purported to violate several election laws. In describing Moncrief, the blurb uses the term "Whistleblower". That's a monikor that Michelle Malkin is also fond of using to describe Moncrief. Anita Moncrief broke news last year and the beginning of this year when she reported all sorts of things to, among others, the New York Times. She's really broken no new news recently. That's what makes Malkin's reporting of her that much more peculiar. You see Michelle Malkin didn't start writing about Anita Moncrief until the middle of May this year.

Anita Moncrief is currently a part time author, part time blogger (at among other places Michelle Malkin's sister site Hot Air), often a panelist at anti ACORN, and the main source for the most explosive seven pages of Michelle Malkin's number one best seller Culture of Corruption (which coincidentally or not came out just more than two months after Malkin became obsessed with Moncrief). In fact, in some places in the conservative media, Anita Moncrief has turned into a sort of flavor of the month. I say some places because others in the conservative media will have nothing to do with her. That's because not only is Anita Moncrief an admitted thief and fraud, but that wasn't something she shared with some media prior to appearing. For a couple weeks, Anita Moncrief made the rounds on Fox News. Then Glenn Beck discovered that while working at Project Vote Anita Moncrief falsely applied for a company credit card and used the credit card for purchase of personal items. Project Vote then fired Moncrief for cause and only after she stopped receiving a pay check did Moncrief begin to blow the whistle on corruption. Many in the media, conservative and otherwise, will have nothing to do with Moncrief because of this. In fact, some leading politicians like Michelle Bachmann won't have anything to do with Anita Moncrief for the same reason. Others like Michelle Malkin, have no problem with it. In fact, Malkin only began writing obsessively about Moncrief following the release of this information.

This is all important for a number of reasons. First, a couple weeks back, I featured a story about Mike McGann. He's a plumbing inspector for the city of Chicago. In October of 2007, he was sent to inspect a water main break at De Diego Elementary School. He discovered a plethora of violations. The violations, in his opinion, were so serious that the kids at the school were in danger and major repairs were necessary. He filed the proper reports with the proper people within the city. For his troubles, he was targeted, suspended twice, and now has no chance for any real advancement within the city. He continues, to this day, to be a plumbing inspector for the city of Chicago. When I think of a whistle blower, I think of someone like Mike McGann. Real whistle blowers blow the whistle when they discover the corruption. They do it because corruption, to them, is unacceptable. By doing it, they put themselves, their careers, and their lives on the line. They do it because what they're fighting is bigger than their own livelihood.

Anita Moncrief didn't do that at all. While receiving a paycheck from Project Vote, Moncrief had no problem with the corruption. It was only after she was fired that she discovered her moral bearings and blew the whistle. That doesn't necessarily make her any less believable, just less heroic. That's only important because when Michelle Malkin writes about her, Malkin turns Moncrief into a heroin.

Former ACORN/Project Vote worker Anita MonCrief — the independent whistleblower who worked closely with NYTimes reporter Stephanie Strom on exposing ACORN financial shenanigans last year before Times editors “cut bait” just weeks before Election Day — informed Strom that the true figure was $5 million.

First, P.R. people are supposed to work on someone's image, not bloggers. Malkin has no business shaping Moncrief's image. Yet, she does it over and over. Malkin is fond of calling Moncrief a whistle blower. What Malkin isn't fond of is telling the whole story. That's the one where Moncrief committed fraud, stole, was fired, and then became a whistle blower. Beyond this, Malkin lays on a series of whoppers. First, Moncrief was never Strom's only source for any story. Say what you will about the New York Times but no reporter would print anything simply because a source told them. Everything that Strom printed that Moncrief told her was backed up either by documentation or other sources. Malkin has also claimed that Moncrief is a main source for both Fox News and the D.C. Examiner. Fox News cut off Moncrief months ago. They don't rely on her period. The D.C. Examiner uses Moncrief for quotes but relies on her for nothing.

All of this is important when you know Moncrief's end game. Her end game is to ink a book deal. That may have already happened and if not, it's close. When that book comes out, here's what it will be about. It will be about a SINGLE MOTHER. It will be about a SINGLE MOTHER from Alabama who was naive and idealistic. It will be about a SINGLE MOTHER that thought she was working for a cause bigger than her. Then, this SINGLE MOTHER discovered that this cause was really full of corruption. For months, this SINGLE MOTHER worked up the courage to tell the truth. Then, this SINGLE MOTHER got the courage to tell the truth. So, began a long trek for this SINGLE MOTHER. This was long trek for this SINGLE MOTHER to discover Jesus and conservatism. Now, I use caps for single mother because Anita Moncrief never misses an opportunity to tell the world she's a SINGLE MOTHER.

I am a liberal Democrat, pro-choice and a Obama supporter. I never wanted for this to progress to this point. I tried contacting in June of 2007 before the credit card, before the termination. I was told that it could get ugly and that since I was a single mom and needed this job for my baby, that I should try to find somewhere else and then contact them again.


Many of you have seen the posts that I put on the March of Dimes website regarding my daughter, Addie.


During 2007, I made some bad choices; I moved to Baltimore to give my daughter a real home and encountered things there that still haunt me. In order to get myself and my daughter out of this situation, I began saving money to move and since I was not making enough to live, I did use their credit card for living expenses like pampers, gas, food, clothes, etc. At $1000 every two weeks, I paid $140 a week in daycare; $993 in rent, plus car note, insurance, food, gas, clothes, formula and utilities


Only this time it’s a single mom named Anita and her sling is loaded with rotten ACORNs. The giant, leftist-perverted legal system is strutting around in front of her while Obama and his crew of czars, handlers, power-mad legislators-turned-rulers and media attack dogs shriek and howl in fearful outrage in the background. Anita is taking careful aim, knowing that Truth will give her the killer blow not only in the court of public opinion but in the actual courts of America. Her time is soon coming when she will not only vanquish her collective legal foe but hold up its severed head so that the Obamunists can no longer hide behind the legal system to consolidate their silent, fraudulent, socialist coup.

and again...

Ironically, that may depend on Anita MonCrief, a young black single mother who testified against ACORN but voted for Obama hopefully last year and then became very disappointed with "Obama change."

Of course, the synopsis for this book has already been laid out by Moncrief herself, in blogposts. (that's how I know) If that's her goal, that's fine. What isn't fine is Michelle Malkin systematically changing Moncrief's story to make her into something she isn't. First, Malkin would never stand for anyone else verbally exploiting their child the way that Moncrief does. Yet, Malkin is loathe to criticize her on this matter. In fact, Malkin rarely mentions Moncrief's theft, fraud or ultimate firing. When Malkin does, it is in a dismissive manner so that the audience is never told the whole story. Malkin claims that Moncrief was a main source for the New York Times, the D.C. Examiner, and Fox News. All of these are lies. None used her as a main source for anything.

Anita Moncrief worked in one office of Project Vote/ACORN. She knew a lot about that office, but that's it. Besides that, what Anita Moncrief knows about ACORN she knows from others, print, and the Internet. Michelle Malkin has claimed that Anita Moncrief was a main source for the embezzlement of Dale Rathke, the shakedown racket by ACORN of H&R Block et al, and the connection between SEIU and ACORN. All of this is nonsense. Anita Moncrief wasn't in a position to know any of this. Anita Moncrief knows this from others who were in a position to know this. Of course, an eventual book would be helped by pumping up Moncrief's knowledge of ACORN, and so pumping up Moncrief's worth to the story would benefit Moncrief. Since Moncrief is a main source in the most explosive seven pages of Malkin's book (almost the rest of the book could be found by reading the internet), pumping her up also helps the credibility of Makin's book as well. It's all very convenient.

See, in the middle of June, Project Vote sued Anita Moncrief in an action that was described by many, including myself and Michelle Malkin, as a means of silencing Moncrief. In fact, Moncrief would have been silenced had it not been for Malkin. Malkin began writing obsessively about Moncrief right after the suit. Most media ran away from Moncrief because that was the first they'd heard of the theft. Not Malkin, she ran towards Anita Moncrief right after the lawsuit. That's even more peculiar because in October of the year before, Anita Moncrief said this about Michelle Malkin.

I also emailed Michelle Malkin but she scares me.

Moncrief has certainly overcome her fear, her fear of Michelle Malkin for one. Conviently, she overcame this fear right at the moment when she was about to be silenced by the lawsuit of Project Vote against her. Malkin literally carried her media water for her for two months. Malkin was just about the only one writing about Anita Moncrief in the months after the lawsuit. Don't listen to me, her's what Anita Moncrief told me herself.

I am a mom (THERE'S THAT MOM REFERENCE AGAIN) who is not working and I am not a major network or two filmmakers with support behind them. I have gone at this alone with many who have tried to discredit or silence me. I am still fighting to expose the WHOLE truth about ACORN unlike some who wish to be selective about the facts.

ACORN did not, as your imply, force me to back down. I had to secure my legal representation, which is not cheap or easy.

I have appeared on the BCAST with Michelle Malkin, spoke at the RightOnline conference (where Malkin also spoke) and was at 9/12 to name a few. I have also done BTR with Andrea Shea King, Kevin Jackson and have more in the works. I have blogs at Hot Air,(Malkin's sister site) and my own blogspot. All of them have a new post up on ACORN. Please check your facts. I am not going anywhere despite the best efforts of some. Please check out my Facebook fan page for my links or ask my 1400 and growing Twitter following if I have backed down from ACORN.

Of course, Moncrief isn't going at this alone. She has the most powerful conservative blogger, Michelle Malkin, as her ally. This would be fine if Malkin would simply tell the truth, the whole truth, about Anita Moncrief. I wouldn't spend so much time writing about this if Michelle Malkin were merely obsessed about Anita Moncrief. I'm spending all this time because not only is Michelle Malkin obsessed with Anita Moncrief but she's dishonest about her. If Malkin were simply obsessing about a story that happened a year ago, I wouldn't care. In fact, no one would and her readership would diminish. Instead, Malkin is not obsessing about a stale story but she's simply being dishonest about it. Anita Moncrief is NOT, as Malkin claims, the main source for anything but the connection between ACORN/Project Vote and the Obama administration. Anita Moncrief is NOT a whistle blower. In fact, the whole story leads one to question Moncrief's motivations in coming forward. The whole thing is also convenient for Michelle Malkin. With the revelations about Moncrief's fraud and theft, most media was staying away from Anita Moncrief. That meant that the seven pages that Malkin dedicated to Anita Moncrief were that much more explosive because most media was running away from the story.

If the relationship were merely convenient and peculiar that wouldn't matter much to me. It shouldn't matter much to anyone. I wouldn't care why Anita Moncrief went from being scared of Michelle Malkin to being her sole source in the ACORN story if Malkin had been reporting on Anita Moncrief honestly. Instead, Michelle Malkin has been systematically dishonest in her reportage of Anita Moncrief. She's painted a picture of heroic whistle blower that was blowing the lid on all the corruption surrounding ACORN. Instead, what Anita Moncrief really is is an opportunist who had the goods on the connection between ACORN and candidate Obama, someone Michelle Malkin hates. There's a difference, a huge difference. Michelle Malkin has a duty to report the truth, the whole truth. She can't simply white wash someone's theft and fraud because those are inconvenient in an overall picture she's painting. She can't say someone is a primary source to Fox News when Fox News cut them off months ago. She can't claim someone knows everything about ACORN when that person was really nothing more than a low level staffer at ACORN. That's dishonest, and when media is dishonest that makes them corrupt, ironic when the same person has made a bunch of money on a book called Culture of Corruption.


One of my long time readers thinks that I am trying to gain some sort of blogging cred in attacking Malkin. I'm not. I don't care about street cred. I wasn't cool in grade school, junior high school, high school, or college. I don't need to be cool now. I am not looking to gain any cred. I write about what interests me. I think it's interesting when someone writes, with righteous indignation, that the president is involved in a culture of corruption and then creates a culture of corruption in their own business. I am not attacking Malkin. I have no place or room to judge. I am telling a story. No one, and I mean no one, has challenged the story. All of my assertions and opinions are based on verifiable facts.

Don't think that those that I am writing about aren't noticing. For instance, I first wrote about the relationship between Malkin, Michael Gaynor and Anita Moncrief. For about four months, Michael Gaynor, another blogger, could be counted on to write about Anita Moncrief two to four times a week. I thought that was corrupt and I said so. It's been nearly two weeks since Michael Gaynor has written about Anita Moncrief. For four months, he couldn't go more than three days without writing about her, and then I call him out, and he suddenly stops writing about her entirely. (though I'm sure that might change now that I called him out again) I've pointed out that Michelle Malkin continues to use the monikor "whistle blower" to describe Anita Moncrief. Low and behold, the last two times Malkin has written about Moncrief whistle blower is NOT used. In fact, here's how Malkin recently described Moncrief.

The sworn testimony, research, and blogging by former ACORN/Project Vote development associate Anita MonCrief have provided an invaluable amount of fodder for reporters (before their editors “cut bait,” that is)

Malkin never described Moncrief as an "associate" before this expose. You can call that a coincidence except that more than 90% of the previous 20 plus posts about Moncrief, whistleblower was used. (if you think that Malkin doesn't read my work, almost all famous people have google alerts to alert themselves of articles about them.) Instead, Anita Moncrief, over the last few weeks, has become much more featured as a blogger on Hot Air. It's all slick and subtle and no one would notice unless they're looking for it like I've been.

As for Malkin, here's why she rubs me the wrong way. Back in June, when the media falsely reported that ACORN changed its name, I wrote this article with a very provocative title. That article was finished at about 11PM Central Time. I called out major media for getting the story wrong, and that included Malkin. It was falsely reported by many that ACORN had changed its name. In fact, it was ACORN International that changed its name to Community Organizations International. I called out Michelle Malkin by name. The next morning at just after 5 AM, wherever Malkin lives, Malkin wrote this article.

There is some confusion over the story about ACORN “changing its name” that
needs to be cleared up and given context. Getting it right is important.

I provided a link to the piece by Kevin Mooney at the Examiner on Monday
in my post focusing on Project Vote/ACORN’s lawsuit against whistleblower Anita

The link was a sidebar to my main story, but I should have spelled out the facts on the name change more clearly, and so should everyone who has mischaracterized the story and glossed over the real reason for the name change:

Malkin was literally parrotting what I said the night before.

It started as a rumor told by insiders to media. Insiders believed that all the revelations were making the ACORN brand so toxic that they may have to change it. Then, ACORN Intl. changed its name and they thought that was an indication that ACORN itself was about to follow suit. Of course ACORN Intl. is NOT ACORN

In the end, there's no really huge story in the original story. The only story now is that some of the conservative media unwittingly and totally recklessly just handed ACORN a gift. At the same time, I am in a position of having to refute a smear against ACORN. Just imagine if it continues to be reported that ACORN changed its name when clearly it hasn't. It will only make things worse. Frankly, everyone that reported it wrong is bound to make a public correction or allow ACORN to cry smear. I expect everyone that reported it wrong to make a correction. If not, they have done more harm than good in trying to expose ACORN.

At the time I wrote my piece, 99% of the media was reporting it wrong. I have no proof that Malkin figured this out from my piece. It was either that or she had an ephiphany in the middle of the night while reporting it wrong herself and the whole media still reporting it wrong. (I put that piece on a fairly liberal sharing site and it exploded and went viral. If you read the title, you'll know why liberals loved it) Malkin conveniently never explained how, in the middle of the night, she came to the realization that she got the original story wrong. If it wasn't me, it's hard to know how she knew. After all, Glenn Beck was on O'Reilly reporting it wrong the night before. Her source, Anita Moncrief, wouldn't have the first clue. So, either Michelle Malkin had a moment of clairvoyance in the middle of the night, or she's petty and couldn't bring herself to credit me for pointing out her mistake. If she's petty enough to do that, is it really all that difficult to believe that she'd systematically mislead her audience about her source in an attempt to repair said sources image?

As Jethro Gibbs would say in NCIS, "I don't believe in coincidences". I don't believe it's merely a coincidence that Anita Moncrief was afraid of Michelle Malkin and then became her best friend when most other media began ignoring her. I don't think it's a coincidence that Michelle Malkin not only writes obsessively about Anita Moncrief but systematically gets things wrong. I don't think it's a coincidence that all of this is happening before, during and after the release of a major book by Michelle Malkin. I don't think it's a coincidence that this cozy relationship also benefits both parties all the while. I don't think it's a coincidence that none of the parties disclose any of the conflicts that come about as a result. I certainly don't believe that Michelle Malkin discovered early one morning that she got a story wrong that I happened to also point out the night before. All that was warranted was a Hat/Tip but Malkin couldn't even bring herself to do that. The corruption has continued since.

Friday, October 30, 2009

Alan Grayson and the Age Old Question

There's a cliche, there's no such thing as bad publicity. If that's true, Alan Grayson is about to test that theory. Grayson first gained notoriety by taking on Fed Chairman Ben Bernanke.

That clip became a cult classic. It was especially classic to those of us that have problems with the Fed, but those folks aren't much of the population. So, this clip came out in July and Grayson was still a relative unknown.

He didn't get known by the public at large until he claimed that Republicans want people "to die quickly".

It went downhill from there. He went on Rachel Maddow and slammed Republicans. He suggested that Dick Cheney was a vampire. Finally, it was revealed that he called a Federal Reserve deputy a "whore".

His behavior is not only erratic but totally inexplicable. He comes from a swing district that surrounds Orlando. He's a first term Congressman. He's no lock to win re election. Why is he saying things that are outrageous?

Certainly, Congressman Grayson is now known by the mainstream. If it's true that there's no such thing as bad publicity, then all of this makes sense. Grayson, however, is challenging that notion and stretching it.

Grayson may wind up helping Grayson. After all, he's become a hero of the far left. He has an open invitation to any show on MSNBC and Air America. Now, everyone knows Alan Grayson. Certainly, his profile has been expanded exponentially. Yet, it doesn't do any favors to his party. Grayson will only go on left wing shows, but the Democratic party may wind up on another network. They're asked about him and forced to distance themselves from their colleague. So, their may be no bad publicity for Alan Grayson but his publicity doesn't necessarily help the Democratic party.

Punishing Insurers, Drug Companies and Doctors to Health Care Bliss

We all agree that health care is too expensive. We all agree that some reform must be done. The question is what kind of reform. It appears the House health care bill wants to create health care bliss through punishment of just about everyone involved in providing health care.

The health care overhaul bill produced by House Democrats would impose an array of new taxes, fees and government mandates on major players in the health industry, including insurers, doctors and drugs and medical devices makers.

In most cases, the pain has been meted out with an eye toward raising the money needed to finance President Barack Obama's plan for reshaping the health system but also with careful regard for gaining the votes that will be needed to pass a final bill.

Try to imagine this logic. The Democrats are going to solve our health care problems by making it more difficult to be a health insurance provider, a drug company, medical device company, and a doctor. If that sounds counter intuitive, that's because it is. In fact, it's just plain looney.

If you make it more difficult to be anything, you get less of that. In this case, there will be less doctors, insurance companies, drug companies, and medical device providers. That's not giving the consumer more choice but less choice. Less choice also means higher costs.

The Democrats are desperate to do several things. First, they're desperate to pass a bill. When a situation like this happens, often the bill becomes a disaster. Second, they're desperate to pay for this massive bill. Revenues, or better yet taxes and fees, have to be used to pay for the bill. Both the health insurance providers and the drug companies are unsympathetic figures. So, if you tax them more, few people get upset. That's a political decision not an economic decision.

So, this bill literally punishes just about everyone involved in providing health care. That's a recipe for a health care disaster. This bill is just under 2000 pages. This is only the first trickle of information that is coming in. As the public analyzes this bill some more, I am sure it will only look even uglier. Punishing those that provide health care is the opposite of what you want to do to provide better health care. Yet, that's the solution that Pelosi Care has brought.

Power Sharing in Honduras

It's a time honored tradition in third world nations that when there's a dispute the answer is a power sharing agreement. Back at the beginning of 2008, Kenya's election was full of fraud. It spun out of control and bordered on genocide. The United Nations stepped in and the violence stopped with a power sharing agreement between the two parties. In Zimbabwe, we had a similar agreement following that election in which there was widespread fraud. The only good news was that it was the first check to the power of strong man Robert Mughabe. More recently, there were folks that wanted to create a power sharing agreement between Hamid Karzai and Abdullah Abdullah following widespread fraud in the Afghan elections.

Everytime there's a crisis, constitutional or otherwise, in a third world nation you can bet that the crisis will be resolved through a power sharing agreement. That appears to be the result in Honduras.

Representatives of ousted President Manuel Zelaya and Honduras' interim government signed an agreement late Thursday that could open the way for Zelaya's reinstatement four months after he was ousted in a coup.

No text of the accord was immediately released, but it was greeted by all sides as a resolution to the long-running political dispute that has polarized the country and subjected it to international sanctions.

"Tonight I am pleased to announce that ... I authorized my negotiating team to sign a final accord that marks the beginning of the end to the political situation in the country," interim President Roberto Micheletti said in a televised address

Now, imagine if in December of 2000, we decided that the election was just too close and so Al Gore and George Bush would "share power". What do you think the reaction in the States would be? There would be outrage and total chaos.

Power sharing is one of those nice sounding and diplomatic words that makes it seem as though grown ups are in charge. They aren't. In each case I highlighted a serious issue caused a crisis. In each case, the crisis wasn't resolved. Instead, both sides came together to share power. The fact that elections were stolen through mass fraud became irrelevant. That's because the chaos following the situation was so extreme that all sides just wanted the chaos to stop.

The same thing is happening now. Manuel Zelaya tried to subvert the Constitution. There are no ifs, ands or buts. That's what he did. He went around what the Constitution allowed in an attempt to govern for life. He was stopped and removed. A crisis insued. The crisis was resolved by allowing both to share power. The crisis following the coup is now resolved, but the Constitutional crisis has not been resolved. If Zelaya can subvert the constitution and keep his power, then the Constitution in Honduras has little worth. That's a much bigger problem for that nation than the violence created.

Morning Market Report

The euphoria following the GDP report may only last one day. Yesterday, all markets were up significantly following news that the GDP grew by 3.5% in the previous quarter. The Dow grew at 199.89, while both the NASDAQ and S&P 500 both grew by more than 1.75%. There is, however, all sorts of economic data coming out today. Personal income and spending just got released and income dipped while spending was flat. All futures are down this morning, though each is down less than .5%.

The security responding most to the news may be Treasury bonds. The ten year U.S. Treasury bond is now trading at 3.45%. That's down almost 5 basis points. Of course, the same gained almost ten basis points yesterday and so it's only giving back some of that. The yield spread between the two and ten year bond is now at 2.50%, the highest it's been in weeks. Bonds in Britain are relatively unchanged while the German Bund are all making significant rallies. The German Bund 30 year has lost about 5 basis points. Meanwhile, crude oil is inching toward $80 a barrel again. It's currently trading at $79.41 after rallying yesterday following the GDP report.

Indices in the Far East were generally up. The Hang Seng in China was up 2.29%, the NIKKEI in Japan was up 1.45%, and the Straits Time Index in Singapore was up .71%. In Europe, the FTSE in London is up .19%, the DAX in Germany was down .71%, and the Spanish index was down .28%.

The dollar is mixed this morning. It's up by .24% against the Euro, up by .05% against the British Pound, and down .39% against the Japanese Yen.

Thursday, October 29, 2009

McChrystal Lite is a Recipe for Disaster

The thing about those darn generals on the ground is that more times than not, they know what they are doing. For instance, General David Petraeus only asked for about 20,000 more troops for his surge in Iraq. There were several reasons for that. First, 80% of the violence happened in Baghdad or in the burbs surrounding it. So, the troops would be used almost exclusively in a fairly small area. Second, the main problem was the strategy and not the troop level. We were then involved in a counter terrorism strategy. We would identify terrorists and go in with a search and destroy mission and kill or capture them. Of course, there would be several more that would invariably show up after this.

So, Petreaus wanted to change it to a counter insurgency. That strategy involved three prongs: clear, hold and build. The clear part meant that troops would go into the roughest and toughest neighborhoods and go door to door until each and every terrorists was rooted out. This was tough fighting and it not only required a new strategy but more troops. That's what the 20,000 in new troops were for. After that, some of the troops would stay around and hold the territory. That's because we learned the hard way that if we didn't stay around the terrorists would come back. Beyond that, economic development would follow.

General McChrystal is following a similar philosophy but Afghanistan is not Iraq. The violence isn't centered in one urban area mostly. There isn't really an urban area period. Afghanistan is full of empty space, rural areas, and all sorts of places for the terrorists to hide. Counter insurgency works by taking space away from the enemy, holding that space, until the enemy has less and less space.

The president wants to give McChrystal some of the troops he wants but not all the troops he wants. The problem is that by doing that we won't have enough troops to clear the terrorists from all their hiding places. McChrystal didn't merely pick that number from the clear blue sky. That's how many troops he needs to clear out all the terrorists from all their spheres in Afghanistan. Without clearing the enemy, you can't move to the hold portion. The president, if this is correct, wants to do counter insurgency on the cheap. That's a recipe for disaster. That means we'll clear them from some places and those terrorists will merely move en masse to where we aren't because we won't have the troops to go there.

That's, in fact, what those involved in the strategy are saying will happen. They are saying that we will take back the urban areas and leave much of the rural areas for the Taliban. That's a recipe for disaster. In fact, it's exactly what Ralph Peters predicted weeks ago.

The "Vote Present" Strategy: Send a token increase of 10,000 or so troops, make cosmetic changes to the mission, try to please everyone partially -- and kick the can down the road.

The evidence on the ground, the lessons of history, and our real security needs strongly favor the Biden approach, but giving Gen. Stan McChrystal the full surge he wants would be far better than "more of the same, with new slogans."

This president has to make a decision. A real decision. But it looks like he's going to wiggle, squirm and dodge, then go in front of the teleprompter to vote "present" again.

Peters predicted 10,000 troops extra. The current word is about 20,000 new troops but the idea is the same. President Obama would change strategies. It would be a more dangerous strategy but he wouldn't give his general enough troops to make that strategy work. That's a recipe for disaster.

Some Questions About Pelosi Care

Politico has a good round up of the Pelosi bill. After getting the initial news, there are several vital questions to answer.

1) What about the Doctor Fix?

That's currently not in the bill. That's a fix to make sure that doctors don't get serious cuts to their Medicare services. The projections are that the fix would cost $247 billion over ten years. It's not in the bill. The bill is supposed to be just under $900 billion. With the fix that puts the bill at about $1.1 trillion. So, will it be resolved or kicked down the road? If it's kicked down the road, when will it be resolved? If it's to be resolved, will its price tag be included in the bill?

2) How much will the fine be for not having insurance?

This is vital. If the fine is too onerous, that will a major tax to young people. If it is too weak, that gives everyone the option to not get health insurance until they get sick. Either way, there is a huge problem.

3) How big a fine will there be for companies not providing health insurance to their employees?

Once again, there are problems either way. If the fine is too small, then many companies will simply pay the fine and send their employees to the government. If it's too large, that's a massive tax on small and mid size businesses.

4) What kind of a shell game are you running?

This will cost about $900 billion over ten years. That doesn't include the doctor fix. So, how much does it really cost? It's also supposed to be deficit positive over ten years but runs deficits over the last five of the ten years. Yet, it doesn't get started until 2013. The taxes are collected right away. So, we have revenues for 10 years. We have expenses for seven years. For five of those seven years, when we have both, we run deficits. So, is the Speaker really saying that this bill won't run a deficit. That's a shell game.

5) What about abortions?

Congressman Bart Stupak is very concerned about this. What language will be in there to specifically not allow federal funding for abortions?

6) What about illegal aliens?

What sort of identification will be required to get government run insurance? Will there be specific safeguards to make sure that everyone is verified to make sure they aren't an illegal alien?

7) How exactly does any of this "bend the cost curve"?

This massive nearly 2000 page bill does a lot. What in this bill will bend the cost curve?

8)How many new bureaucracies will there be?

In H.R. 3200, there were 53. How many will there be in this bill? How many new regulators and bureaucracies are people comfortable with? How much will health care change with all these new regulators and bureaucracies?

Not Buying Pelosi Care

Now, it isn't that I'm not buying. I'm not. That shouldn't surprise anyone that has read this site any more than once. What I'm not buying is that Democrats have the votes to pass this thing. The current version of Pelosi Care is no different in any significant way from H.R. 3200, which passed before the break. The bill will cost about a trillion dollars over ten years. It will cover about 35 million of the uninsured. It will have mandates for employers and for the uninsured. It will have fees for insurance companies and the wealthy. It will expand coverage of Medicare and Medicaid but cut reimbursement for both.

So, we have taxes on the uninsured and small businesses. We have cuts to both Medicare and Medicaid. It's going to cost more than the president wants. These are all the problems that Blue Dogs and others that have had since the beginning. This bill will not "add a dime to the deficit" according to Nancy Pelosi. That maybe so, but that's because it won't start to be fully implemented until 2013 while the taxes begin to be collected starting next year. That's an accounting trick and it isn't going to fool most people. Adding taxes to small business owners and the uninsured is a tax on groups that are the third rail in politics. Cutting Medicaid and Medicare is another third rail.

So, what's so different about this bill from H.R. 3200? There isn't much difference and yet Speaker Pelosi wants this voted on by the end of next week. Bart Stupak was on Fox News this morning saying that he's ready to block the bill simply from the language regarding federal funding for abortion. That's an issue that can and should be resolved and yet, that isn't resolved yet. We haven't even gotten into the weeds of this bill yet. We're still on an unnecessary divisive issue.

The same person that has blown through deadline after deadline is now telling us confidentally that in the next week and a half at the most this will be debated, voted on, and passed. I'm not buying it. This is the same train wreck that H.R. 3200 was. There's nothing diffierent here. The Blue Dogs were against that bill and they will be against this. There's nothing here that has altered the bill to make it any better. If Blue Dogs vote for this bill, they will be voted out en masse. Those that also voted for cap and trade are really in trouble.

This bill was put together in secret. No one outside of a handful of people have seen the bill in its entirety and there are reasons for that. Pelosi knows that with enough sunlight the bill will be exposed for the disaster that it is. That's what is about to happen and so I am not buying the timeline that Pelosi is pushing.

Morning Market Report

There's so many numbers for the market to chew on. First, and foremost, the third quarter Gross Domestic Product number came out. It's the broadest economic number there is. The economy grew by 3.5% in the third quarter. That's not only a great number but slightly above estimates, which were about 3.2%. It's important to remember that we've had four straight quarters of losses and so the economy still has a lot of making up to do. This is, however, the clearest sign that we are beginning a recovery. The weekly first time claims also came out and they were down a thousand to 530,000. That number continues to be between 500-600k and it doesn't appear to show much pattern. On the earnings front, Exxon Mobil had weaker than expected earnings and the stock is down about one percent in pre market trading.

The Dow suffered through it third straight day of losses yesterday. It lost 119.49 yesterday and dropped into the 9700 range. The NASDAQ and S&P weren't any better. The markets are, however, responding positively to the GDP numbers and the dow looks to open about 60 points higher at the open. Meanwhile, Treasury bonds are likely to break their mini streak. The ten year U.S. Treasury reached 3.40% but it's now back to 3.45%. The yield spread between the two and ten year is now at 2.49%. Bonds in Britain are currently relatively unchanged while they are giving back as much as six basis points (six hudredths of a percent) in Germany.

Meanwhile, crude oil is up just slightly to $77.58 a barrel, and so it's not responding quite as much as everything else has been to the economic data. We had mirror images in Europe and the Far East. The Far East is down across the board and in Europe they were up across the board. The Hang Seng in China was down 2.28%, the NIKKEI in Japan was down 1.83%, and the Straits Time Index was down .63% and the broader Chinese index was down 2.34%. In Europe, the FTSE in London was up .81%, the DAX in Germany was up 1.3%, and the Spanish index was up .87%. (I should note that some of these markets are still open so some of these indices are is)

The Dollar isn't necessarily responding that well to the GDP numbers. The dollar is down .59% against the Euro, down .59% against the British Pound, but up by .76% against the Japanese Yen.


It's important to note that technically a recession starts when there's two quarters of negative growth. That means the recession technically started at the end of the first quarter this year. Still, most said it started at the end of 2007. Recessions technically end after two straight quarters of growth. So, technically, the recession will end at the end of the year. Yet, most economists will say the recession ended sometime at the end of the summer. I usually go with the textbook definition of a recession. That's how I learned it in high school, but economists seem to make up their own rules.

Also, an Edmonds study said that cash for clunkers cost about $24,000 per car to the tax payer. Another study says that the first time home buyer credit costs the tax payer about $64,000 per purchase. Both of these had stimulative effects and their stimulus was felt in the third quarter. It remains to be seen if this was an artificial stimulus or if it stimulated the economy in real terms. Future GDP numbers will tell us that.

Wednesday, October 28, 2009

Video, Quote and Word of the Day


four-sided shaft of stone

It is dangerous to be right when the government is wrong.

Back to the Drawing Board

That's where Harry Reid will be very soon.

The problems Senate Majority Leader Harry Reid is having securing the 60 votes he'll need to block a filibuster of his health care reform bill raises the possibility that he'll scrap his proposal and revert to a more moderate version that can attract bipartisan support.

The Nevada Democratic rolled out a bold bill Monday that includes a controversial government insurance plan, leaving several moderate Democrats on the fence and expressing deep skepticism. Democratic aides told Fox News that Reid, who still does not have the 60 votes needed to kill a Republican filibuster, could end up falling back on an alternative plan pushed by Republican Sen. Olympia Snowe of Maine.

Maine wanted a bill that would "trigger" a government health insurance plan in the future only if insurance companies do not meet certain benchmarks. Reid ignored that suggestion, and when he rolled out a health care bill that includes a government-backed insurance plan that individual states can opt out of, Snowe withheld her support.

Now, besides the fact that it doesn't appear that Reid doesn't have the votes, there are even other problems for this bill. Let's start with the fact that it's done but Reid refuses to release it. That's never a good sign. You aren't hesitant to release that which you think is a good piece of work. In fact, no one will see the bill until Tuesday of next week at the earliest. That's when the CBO scoring will be finished.

Just put that together. It doesn't appear as though the Senate Leader has the votes and we haven't even seen a bill yet. We don't even know what the bill will cost yet. That's not a recipe for success.

In fact, it's not entirely clear what Reid is trying to accomplish with this exercise. This bill isn't going to pass even if the CBO scores it well enough. So, all Reid is opening himself up to is hyperanalysis of a bill that won't be law anyway. That sounds like a painful death for no reason. Reid doesn't appear to know what he's doing. This is a total debacle. The bill doesn't have the votes to pass. He knows it. We all know it. Instead of going back to negotiations he is going through the motions.

Of course all that does is waste another couple weeks. We'll be into November just when this bill will be produced. This bill will not become law. So, we'll spend a week or two debating a bill with no hope of passing. Where does that leave the health care debate? It leaves it in total chaos, where it's been since the beginning.

Council Submissions

The Council submissions are up.

Council Submissions
Mere Rhetoric - Lefty Meme Congeals: The Real War Is In Pakistan Not Afghanistan
Joshuapundit - J Street – A Particularly Nasty Dead End To Be Avoided
Bookworm Room - The march of the thought police
The Provocateur - My Interview with Wade Rathke
The Glittering Eye - Are We Promoting Our Grand Strategy?
Rhymes With Right - And To Think The Average Income Of American Families Dropped By 3.6%
Right Truth - Overwhelmed by current situation in America and the world
Council Submissions
Submitted By: The Watcher – Dismantling America - Thomas Sowell at Real Clear Politics
Submitted By: The Watcher – Riehl World View - Exclusive: How The NRCC Bungled NY – 23
Submitted By: Mere Rhetoric – Pajamas Media - Showdown on J Street
Submitted By: Joshuapundit – The Augean Stables - Investigate the investigators: A time to rebuke Goldstone
Submitted By: Bookworm Room – GM’s Place - Splitting: Fox News and the White House
Submitted By: The Provocateur – Mercury News - Racial Skirmishes in our Own House
Submitted By: The Glittering Eye – Daniel W. Drezner - Theory of International Politics and Zombies
Submitted By: Rhymes With Right – JammieWearingFool - Why Is GE Exempt From Government-Ordered Pay Cuts?
Submitted By: Right Truth – The Tygrrrr Express - Why not just kill all conservatives?

The Story Behind Organizers as Bank Regulators

About three years ago, at a board meeting of ACORN in Louisville, Kentucky, the board had on its agenda, among other things, the issue of branding. Folks were discussing back and forth ways to improve ACORN's brand. It's important to note that at the time of this meeting ACORN was still relatively unknown. Their brand hadn't taken the hit it's since taken. The board was looking for ways to raise its profile.

One idea that came up was the idea of a seal on the door of local and regional banks that would be ACORN's seal of approval that such an individual bank had passed their seal of approval of being a lender that doesn't engage in predatory lending. The best comparison one can make is the Goodhousekeeping seal of approval. In fact, consumer reports and all sorts of other magazines and groups create such independent oversight.

In each case, the power of the approval comes entirely from the reputation of those providing the approval. After all, Good Housekeeping has no actual regulatory power. Instead, their seal carries weight because Good Housekeeping has gained a reputation as an expert in that area. Consumer reports has a similar reputation.

The folks at ACORN felt that they could gain the same type of reputation. After all, they had worked on issues related to predatory lending for years. They are always on the streets working directly with the poor. Furthermore, if ACORN creates the seal on their own, they are the regulator. In fact, it's much more powerful than being a government regulator. Good housekeeping makes the rules themselves for their seal. The same is true of consumer reports. ACORN wanted the same thing.

There's almost nothing in this world more powerful than determining whether or not a lender is a predatory lender. Here's what an article from a North Carolina newspaper said about predatory lending.

There is no specific definition about what exactly predatory lending entails, though most observers believe that the description applies when lenders take advantage of borrowers by charging high interest rates and consider only the value of a borrower’s assets, as opposed to what the borrower can afford to pay.

If you can't define it, then it is whatever you want it to be. If ACORN could position themselves to be the authority on predatory lending and the independent authority that those in the poor communities counted on for guidance on which bank was and wasn't a predatory lender, then that was literally hitting the jackpot.

It was a brilliant idea in theory, but it never quite made its way from theoretical to the real. So, it's an idea that has been in the idea stage ever since. Maxine Waters, the far left liberal from California, is a good friend to ACORN. She's a frequent speaker at conferences and other events they put on. She recently came up with this idea.

During consideration of H.R. 3126, legislation to establish a Consumer Financial Protection Agency (CFPA), Democrats on the House Financial Services Committee voted to pass an amendment offered by Rep. Maxine Waters (D-CA) that will make ACORN eligible to play a role in setting regulations for financial institutions.

The Waters amendment adds to the CFPA Oversight Board 5 representatives from the fields of "consumer protection, fair lending and civil rights, representatives of depository institutions that primarily serve underserved communities, or representatives of communities that have been significantly impacted by higher-priced mortgages" to join Federal banking regulators in advising the Director on the consistency of proposed regulations, and strategies and policies that the Director should undertake to enforce its rules.

There's a few things to consider here. First, the Waters amendment is a total perversion of the idea discussed in Louisville and thus the idea that ACORN has been cultivating since. ACORN never wanted to be a government regulator. That's too constraining. They wanted to be their own regulator. That's freedom and power. So, it's almost certain that there was a miscommunication between the ACORN folks and Waters. Someone at ACORN not only jumped the gun here but the idea was perverted.

Meanwhile, Waters appears to be totally politically tone deaf. First, this bill has no chance of becoming law. She couldn't have brought it up at a worse time. She's decided now, with ACORN in the middle of all this controversy, to bring up a bill that will give ACORN access to government regulatory power. All this does is give her opponents an opportunity to confirm all the worst stereotypes of liberal politicians like her. The right blogs have exploded with this. Now, opponents of Waters have a field day with a bill that has no chance of passing.

Tuesday, October 27, 2009

Attack of the Purists

Meet the Conservative's public enemy number one. His name is Newt Gingrich. Yes, the same person that brought us a balanced budget, capital gains tax cuts, and welfare reform is now public enemy number one among conservatives. Gingrich's moment of sacrilege came when he endorsed liberal Republican candidate Dede Scozzafava over Doug Hoffman in New York's 23rd special election.

Don't get me wrong. I am none too happy with Gingrich's move here. It seems like a head scratcher. After all, this district is solid Republican. A liberal isn't needed to win. Yet, I don't think that this makes him public enemy number one. Then again, I am not a Conservative purist, just a conservative. For instance, my first choice in 2008 was Rudy Giuliani. Yes, I know he was pro abortion, pro gay marriage, and pro gun control. I didn't much care. Rudy was a successful prosecutor and a successful mayor, and I thought that made him ready to be a successful President. My second choice was John McCain. He was the biggest terror warrior and that's what mattered to me in war time.

The conservative purists, those like Laura Ingraham, Rush Limbaugh, and Ann Coulter, all liked Mitt Romney and or Fred Thompson. That's because both were the most conservative. That's all that mattered to them. It didn't much matter that Mitt Romney only became a conservative just in time to run for President. It also didn't matter that Fred Thompson was a conservative that didn't do much governing or legislating. All that matters to purists is that someone is a conservative. Stray from the party line so to speak and you become public enemy number one.

That's what's happening in New York's 23rd district. The conservative purists, the likes of Michelle Malkin and Red State, are taking sides, taking names, and taking notes. You're either with them, or you're the enemy. That's where Newt Gingrich finds himself now. Newt has even bigger problems. He partnered with Nancy Pelosi on climate change and with Al Sharpton on education. That's heresy in some circles and he's no longer welcome in some clubs.

Now, mind you, the purists have never run for an election. They've never crafted a bill, governed, or run a party. These purists think that the Republicans could be successful if the only Republicans out there were all down the line conservatives and no one else. In fact, those Republicans that stray are worse than Democrats, they're RINO's. In the circles of the purists, folks like Lindsey Graham are worse than folks like Carl Levin. Levin already works for the enemy. For the purists, Lindsey Graham works for the enemy from our side. The purists want you to toe the line and under no circumstances do you work with the enemy.

It's of course totally absurd. Rahm Emanuel, back in 2006, ran a very successful electoral campaign by putting victory above ideology. He found dozens of moderates to run in conservative districts and they formed the base of a stunning 2006 victory. Anyone that thinks the Republican party could win anything by running conservatives everywhere hasn't the first clue about things like demographics, elections, and politics. If any purist thinks a down the line conservative could ever win in Maine they are delusional and stupid, with all due respect. For all the contempt they have for Olympia Snowe and Susan Collins, they're both as conservative as a Republican is going to get in Maine. So, it's either a moderate like Snowe and Collins or a Democrat, period.

The purists will take on anyone that strays on anything. For instance, here's how Red State treats Carly Fioriano.

While some of us are fighting hard against the Obama push to nationalize the Internet, Fiorina goes behind our backs and joins them, just as Scozzafava will work with ACORN and Planned Parenthood. Meanwhile, Chuck DeVore knows the
score and endorses Doug Hoffman.

There are two kinds of Republicans. Some are on our side. Some are more interested in the left. I know which I prefer to represent our party.

Don't get me wrong. Everyone should be held to account. Everyone should vote for who they feel is the best candidate. What I think is totally destructive is the contempt that purists feel toward any Republican that strays from the conservative line. About a month ago, Lindsey Graham got excoriated by the purists when he suggested that he wants to work with John Kerry on climate change. Just think about that. Graham is the scourge of the purists because he dares to suggest that he wants to work with John Kerry on climate change. Mind you, he didn't say he supports the current bill. He didn't even say that he would vote for a climate change bill. He just said he wants to work with John Kerry on the bill. That's enough to draw ire.

The whole thing is also totally hypocritical. Ask any purist who their favorite Democrat is and almost to a person they'll tell you that it's Joe Lieberman. That's because Lieberman is independent enough to buck his party. He just did it on health care and he more famously did it on Iraq. So, when a Democrat bucks their party, they're courageous. They're the kind of Democrat that purists like. When a Republican, like John McCain, does the sam thing, he earns a place just above the devil. Conservatives aren't good simply because they're conservatives and liberals aren't bad simply because they are liberals. The only politicians I really don't like are the dishonest and corrupt politicians. Besides that, those that disagree with us on any given issue are not our enemies. They aren't to be treated with scorn and contempt. The world can't be split on ideology.

If the Republican party only allows those that agree with each other on every issue, that's not a party but a cult. That becomes something out of Jim Jones and not Ronald Reagan. If who you happened to endorse in a special election in Congress is now a litmus test, that's a problem. The irony is that Newt Gingrich has done more for the conservative movement than all the so called purists combined. Yet, he dared to stray and the purists want him purged. That's not just wrong but it's totally unhealthy.

The Patriot Act, Fox News, and Distortions

Last week, I wrote this piece to counter the so called distortions of Fox News. Generally, I think I was accurate however there was one area which I got monumentally wrong. I want to correct the record for many reasons, and not the least of which is that the issue is vitally important. It had to do with number six which involves a segment between Trace Gallagher and Bill Sammon

I tried to minimize the distortion, however there's no minimizing this distortion. I spoke with Julian Sanchez of the CATO institute, and after getting the facts, there's no defending this segment. Both Sammon and Gallagher couldn't have gotten it more wrong. First, let's define the issue.

Sammon and Gallagher talked about three portions of the Patriot Act that they claimed the Democrats were trying to remove. Both also claimed that each of the three played a role in capturing terrorists going back to Zac Moussaoui. The first is entirely inaccurate and the second is dubious at best. The three provisions are the loan wolf provision, roving wiretaps and section 215.

The loan wolf provision allows the Feds, almost always the FBI, to identify someone as a terrorist even though they aren't necessarily part of a terrorist group. In this case, a terrorist doesn't have to be part of Al Qaeda to be treated by FISA as a terrorist and thus have all sorts of Patriot Act applications apply to them. These folks would still have to be citizens of another nation. They would also still have to have contact with folks overseas. The application would apply to someone that came to this country and then became "radicalized" by reading things on the internet, going to a Mosque, or any other way that someone gets radicalized.

So, in other words, someone comes to the country for something legitimate: going to school, a job, etc. Then, they get radicalized and they decide to try and pull off a terrorist attack. In the process of doing this, they make contact with terrrorists, or those with terrorist connections, overseas. Then, this person begins to plot a terrorist attack. Then, such a person would become a "loan wolf". This provision is the only one of the three that is scheduled to be sunsetted. Yet, Mr. Sanchez said that this provision has never been used. This makes sense because it appears the "loan wolf" is much more theoretical than anything rooted in reality. If someone were to get radicalized, they're much more likely to travel to the Middle East and get trained first. Then, they would officially be part of a terrorist group. Furthermore, Sammon and Gallagher suggested that this provision could have been used on Zac Moussaoui. That seems dubious since he was part of Al Qaeda, and Mr. Sanchez said the Senate looked at Moussaoui's situation. At issue was his computer. The Feds never opened it or looked inside. According to the Senate investigation, that happened mostly due to incompetence, rigid federal procedures, and a lack of communication. The Senate concluded that no one needed any new laws to open the computer.

The second provision is the roving wire taps. Traditionally, when you get a warrant to tap some media, you have to be very specific: a certain phone for a certain purpose for instance. We all know that even criminals have become astute. There's pre paid cells, a plethora of email accounts, and all sorts of other available communication for criminals and terrorists. If the Feds had to get a new warrant everytime a criminal or a terrorist changed media (say from one pre paid cell to another) they'd always lose valuable time. So, roving wiretaps don't only make sense in terrorist investigations but even in criminal investigations of say the Mafia. In fact, according to Sanchez, no one wants to sunset this provision. Rather, the provision was, in his opinion and that of Nadler, Feingold, and Conyers, too broad. The changes are unbelievably wonky and frankly, most of it was above my own head. What is important is that no one wanted to sunset this provision. Rather, Nadler, Feingold and Conyers wanted to tighten up the provision so that the standards were more difficult to meet so that the power wasn't as broad. Now, it may be a matter of debate whether the current power is too broad or just fine, but frankly, that's not a debate that either Gallagher or Sammon are equipped to be a part of. Such a debate would require a libertarian expert like Julian Sanchez facing off with another more hawkish expert.

The third provision is called the 215 order. The section 215 order appears to be the broadest. To explain it, I need to use an example. Let's say that a tip comes in that in Glenview, Il. there is a group of terrorists. You, at this point, don't even need to know specifically who they are. You just need to meet a standard with a judge that there are terrorists there. This warrant allows the Feds, again almost always the FBI, to conduct searches without letting the suspected terrorists know. This section is again terribly wonky, but in some cases, the feds can get a warrant to ask for any hardware store in the town of Glenview for all their receipts as part of the investigation. They can do this if they suspect that terrorists are buying bomb making material there. With this section, again Nadler, Feingold, and Conyers are trying to tighten up the requirements to receive this warrant. No one is trying to remove the power entirely. Again, there is plenty of debate for whether the tightening is appropriate or not but that debate must be left to an expert like Julian Sanchez to debate with another expert of a differing philosophy and not Trace Gallagher and Bill Sammon.

In fact, this debate over the Patriot Act has gone the way of most debates, and that is on ideological stereotypes. If you are against the Patriot Act, you want to give terrorists rights. If you are for the Patriot Act, you don't care about civil liberties. For almost all, it's that simple. It isn't. I asked Mr. Sanchez what he thought of the Patriot Act and his answer was revealing. He told me that such a question was too broad. The Patriot Act is a collection of about 150 provisions. Some he liked and others he didn't. His fear is political. He believes that politicians will error on the side of national security because they don't want to be blamed for allowing a terrorist attack. It's much more difficult to prove a violation of civil liberties.

He fears that the Patriot Act could be used by the feds to go after drug cartels when they don't have enough evidence to get a regular warrant. If the Patriot Act becomes too broad then the FBI will link Colombian drug money to Al Qaeda and get warrants using broad powers. He's not saying that's happening. He is, however, saying that this can happen if no one is curbing the powers in the Patriot Act.

In fact, these debates are for wonks like Julian Sanchez, and that's the problem. Folks on television will often come on to give opinions without consulting with experts and then mislead due to their own naivite. That's what I did, but I have now corrected the record, and hopefully, so too will Fox News.

Harry Reid's Winging It

The day after Harry Reid boldly proclaimed that he was ready to produce a health care bill with a form of a public option, some serious cold water was poured on the idea.

Sen. Joe Lieberman (I-Conn.) said Tuesday that he’d back a GOP filibuster of Senate Majority Leader Harry Reid’s health care reform bill.

Lieberman, who caucuses with Democrats and is positioning himself as a fiscal hawk on the issue, said he opposes any health care bill that includes a government-run insurance program — even if it includes a provision allowing states to opt out of the program, as Reid’s has said the Senate bill will.

"We're trying to do too much at once," Lieberman said. “To put this government-created insurance company on top of everything else is just asking for trouble for the taxpayers, for the premium payers and for the national debt. I don’t think we need it now."

Now, the question I would have is did Harry Reid take some sort of a whip count before announcing he was ready to produce a bill. It's no secret that Joe Liberman had problems with the bill. It's no secret that several moderates had problems with the public option. Are we really to believe that Harry Reid produced a bill without knowing if the votes were there to pass it?

This is the keystone cops version of legislating. Harry Reid appears to have put out a bill which he put together in secret with few others and he had no idea if he had or has the votes to pass it. Now, we know he doesn't have the votes to pass it. In the piece, it says that "several moderates wanted to wait for details" before deciding whether to support the bill. That means that Reid put this out without giving them the details.

It's hard to put into words how looney that is. Harry Reid produced a bill that is extremely controversial. He did with little input from the rank and file in his own party. He did it without knowing if he had the votes to pass it when he did. The health care debate is in total chaos.

Mr. President: Take Some Advice from John Wooden

President Obama met with some sailors yesterday and again defended his indecision on his strategy in Afghanistan.

I will never rush the solemn decision of sending you into harm's way. I won't risk your lives unless it is absolutely necessary," Obama said to loud applause. "And if it is necessary, we will back you up to the hilt

It's now been more than two months since the General, Stanley McChrystal, requested about 40,000 more troops for the war in Afghanistan. The president has yet to give the general the troops he requested. When criticized, the president constantly reminds everyone the gravity of the decision. No one doubts that this decision is of vital importance. Unfortunately, in war, very difficult decisions must often be made without the benefit of time.

John Wooden used to follow a philosophy that should help the president here, "be quick but don't hurry." Everyone agrees that this decision must be made carefully, but it also must be made quickly. John Wooden used that philosophy to great success in basketball and the president must stop delaying and make this decision as well.

The war continues while the presidents mulls his "solemn decision". That's unacceptable. Wars are fluid and decisions can't be made at your own pace. They must be made at the pace of the war. In that respect, it's no different than basketball. Wooden's philosophy is simple and it applies here. The president must start to be quick while not hurrying. Right now, it appears as though he simply doesn't want to make a decision.

Morning Market Report

The markets took another tumble yesterday. The Dow fell below 9900 as the markets extended their losing streak to two days. The strong dollar is commonly being seen as the culprit if you will for the poor stock market indices yesterday. Meanwhile, U.S. Steel and TD Ameritrade both beat earnings estimates. Consumer confidence along with the Case Schiller Home Index will be announced during the market as well. Meanwhile, the U.S. Treasury will auction off a record amount of new Treasury bonds. Today, it will auction off $44 billion of 2 year treasury bonds. That will be announced after 1 PM ET.

Futures are trading roughly even. The Dow is slightly higher while both the S&P and NASDAQ futures are slightly lower. There's plenty of news during the market and so that doesn't appear to necessarily be a harbinger. The ten year U.S. Treasury bond is now at 3.55%. That's slightly better this morning however it's gained over 20 basis points in just under a week. The yield spread between the 2 and 10 year bond has grown to 2.54%. That's been on its way up since reaching a recent tightening of 2.40% earlier in the month. Crude oil took a major breather yesterday. It fell below $80 a barrel and in fact ended below $79 a barrel. It's currently trading at $78.90. That's up slightly but well of the highs it reached at the end of last week.

We have mirror images of each other in Europe and the Far East. The Far East was down nearly universally while the opposite is true in Europe. The Hang Seng was down 1.86%, the NIKKEI in Japan was down 1.45%, and the Straits Time Index in Singapore was down .81%. In Europe, the FTSE in London was up .39%, the DAX in Germany was down .03%, and the Spanish Index was up .1%.

In currencies, the Dollar is taking a bit of a breather, likely due to some profit taking, after a good day yesterday. It's off by .13% against the Euro, off by .15% against the British Pound, and off .14% against the Japanese Yen.

Monday, October 26, 2009

My Interview With Wade Rathke

People that know him, and know him well, have described him as an "organic genius" and a "diabolical genius". He's become a lightning rod and a polarizing figure, and he's at the center of a national debate. Wade Rathke is the former long time CEO, or Chief Organizer, of ACORN, the Association for Community Organizations for Reform Now. He's now running Community Organizations International, the former ACORN International. When I emailed Wade Rathke this past Friday, I was surprised that he agreed to an interview. I was even more surprised that he was familiar with my work. Yet, he was willing to give me some time this past afternoon. So, what follows are some of my thoughts following an interview that lasted about an hour.

The campaign that COI is most involved in, or at least featured on their main page, is the campaign to reform global remittance. Global remittance is the process by which ex patriates send money back to family in their home country. For instance, it's been well documented that Mexico's main economic source is actually money sent back home from the USA. According to Rathke, this is an industry that topped $300 billion, and far too many of its players practice predatory lending practices. For instance, Rathke has seen fees up to 20% of the amount to be wired. So, if someone were to send $1000 back home, they would be charged $200 to process this transaction. Rathke stressed that such fees were an "outlier" but fees of 5% are about the norm. In his view, this is far too much, and the poor are being taken advantage of by predatory lending practices in this area. Furthermore, with these rates, it also leads to a black market. That's what's happening. Often people send money home with all sorts of strangers because they're promised that it will get there with no charge.

Furthermore, fees to countries in Africa are often significantly higher than to Mexico and other parts of the world. Rathke told me that he hasn't seen any evidence that it actually costs a Western Union any more to wire money to Africa than it does anywhere else. So, the fees should be the same. Rathke would like to "open a dialogue" with Western Union, Moneygram, as well as several of the largest multi national banks to speak about fees charged for remittance. In fact, Rathke believes that multi national banks like Citigroup could get involved in remittance and not only bring about much needed competition which would bring prices down, but also add another source of income for these banks.

For now, Rathke would merely like to sit at the negotiating table with representatives of Western Union et al. He told me that he didn't have a percentage in mind. He was hoping to get an idea of how much it costs these organizations to process these transactions and then negotiate a "fair rate". One individual I spoke with called Rathke a "master negotiator" and so that's probably a place he'd be comfortable at.

I pointed out that major banks and wire transfer institutions like Western Union aren't likely to sit down at the negotiating table with Wade Rathke just because he asked nicely. I also told him that I believed that he wouldn't give up just because the other side wasn't willing to negotiate when asked nicely. So, how far would he take his protests and how cut throat would he be in dealing with these banks and transfer institutions? I asked if he was willing to picket outside of these places. Rathke laughed and he told me that he didn't think that pickets and protests were "cut throat" and that "if an institution is predatory in their remittance charges you bet we'll let their customers know it". Rathke told me that at this stage COI only wants to represent those folks looking to use remittance services and isn't looking to be a vendor because among other reasons they don't have the infrastructure for such a venture.

COI is also working on a campaign in India to raise the profile of the issue of Wal-Mart's entry into India. In India, internal laws don't allow for retailers from outside the country. So, that bars WalMart from entering the country. Still, Rathke says that it's inevitable that WalMart will find its way into India in the next five to ten years. He said that in their society there are all sorts of unintended consequences with bringing WalMart in. Currently, retail in India is done mostly be street vendors and the equivalent of our mom and pop thrift stores. Having a big box top store come in and swallow up neighborhoods can create all sorts of adverse effects on such a society. As such, COI is campaigning to have the government in India study and plan for WalMart's inevitable entry into their market. Rathke has a long history with Walmart. Several years ago, he campaigned for a living wage and health insurance for Walmart employees. When, in 2006, a Walmart employee was left for dead because they were very sick and without insurance, the publicity that Rathke created from this story caused Walmart to relent and begin to provide health insurance to some employees and they cut their generic prescription prices to $4.

The one impression I got of Rathke is his pleasant demeanor. If the pressure and stress of the controversy surrounding ACORN has gotten to him, he certainly didn't express it outwardly. Several folks told me that to be a good organizer you have to have a pleasant demeanor. I next turned to some questions about ACORN itself and it was at this point that the interview, which was almost exclusively pleasant, became contentious. I asked him what he had learned from his experience at ACORN and how he would try to apply that to COI. He was coy as though he didn't understand what I was asking though I believe he did. He told me the structure of ACORN is different than the structure of COI. ACORN, according to Rathke, was one corporation while COI was a federation. In that, COI is currently in seven different countries. Yet, each country is its own separate entity. Meanwhile, all of ACORN's affiliates, according to Rathke, were all part of the same organization. Yet, I pointed, Rathke was in control of the entire federation.

I said that a cynic would believe that the bank accounts of ACORN Dominican Republic and ACORN Canada (each individual country in COI still uses the ACORN name) would eventually be comingled. Rathke responded that international banking laws would never allow such things. I responded that there were all sorts US laws that were broken by ACORN. At this point, Rathke lost his pleasant demeanor. He told me that ACORN broke NO laws. In his 39 years at the helm, they were audited each and every year and passed each and every time. He told me that I was talking to Wade Rathke and not some right wing ideologue.

There are several points of interest in this exchange. First, if Rathke sits at the top of this "federation", it's still unclear to me how each is separate. Without knowing who controls each bank account, it's still not clear that funds can't be comingled. Second, and much more importantly, ACORN always claimed that affiliates were separate of each other. Here, Rathke told me what many that want ACORN reformed have suggested, if not accused. That's that ACORN and its affiliates aren't separate but all part of the same organization, ACORN itself. What Rathke told me about ACORN's structure is exactly the same as what many critics of ACORN have accused the group of doing.

I also asked him about the firing of Beth Butler. Butler is Rathke's common law wife and she was, until recently, the long time head of Louisiana's branch of ACORN. Rathke thought that it was inexplicable that at this point of turmoil that the hierarchy would fire Butler. The move only added chaos at a time when the organization was already in turmoil. He couldn't explain it, understand it, or in any way see how it helped ACORN. I asked him what he thought of Steve Bradbury taking over for Butler. The back story here is that Bradbury could be considered a protege of Rathke. He certainly taught Bradbury a lot and Rathke had befriended Bradbury and groomed him for years. By taking over for Butler, this could be viewed as a betrayal. I said none of this, and Rathke was diplomatic. He told me that he read in a newspaper that Bradbury said this move was temporary and Rathke was taking him at his word.

Finally, I asked Rathke about his legacy. Did he think about his legacy? "Mike, I've been doing this for forty years, of course I think about my legacy". He believes his legacy still has several chapters left. In that way, he looks forward. At the same time, he told me that no one is a "bigger fan of ACORN" than Rathke and that he's saddened to watch them disintegrate so badly. He certainly understood that this disintegration did no favors to his legacy. Several people told me that much Alinsky has become an adjective and a verb, that one day Rathke would be synonymous with a style of organizing. With no hint of modesty, Rathke agreed.


I didn't ask Wade Rathke about his brother's embezzlement. When things became contentious, I cut it off and moved on. I did this for several reasons. First, I asked Wade Rathke if he had time to talk about his campaign about remittance. I could have blind sided him with all sorts of gotcha questions about his brother and other alleged ACORN misdeeds. I don't think that Rathke would have made any stunning admissions to me and of course, that's not what we agreed on. Last week, I wrote about the firing of Beth Butler and I said that moving forward Wade Rathke is the story. That's the case. What has happened, the embezzlement, the investigations, and the disintegration, is not the story. Wade Rathke is the story, and what he's going to do going forward is the story. All the other things have been hyperanalyzed, and there's nothing I could have added to the discussion.

Wade Rathke is trying to do in the world what he did in the US. That is to grow a community to serve the poor and middle class throughout the world. People from all sides of the philosophical and ideological aisle will fill in the blanks on that statement. Ultimately, that chapter has only begun. It is the story now, and that's why I wanted the interview. What happened in the past isn't nearly as interesting as what Rathke wants to do in the future.

Here is part II of this interview series and part III.

The Public Option Shuffle

Harry Reid tried to do a misdirection. He knew that many Senators had qualms over the public option. He knew that many liberal Senators wouldn't accept a health care overhaul without one. So, Senator Reid attempted to split the difference.

Senate Majority Leader Harry Reid announced this afternoon that he plans to push
ahead with a public health insurance option that includes an opt-out provision for states – even though he's currently short several votes for passage, according to people close to the situation.

"It's the fairest way to go," Reid said at a news conference, where he said he’ll send the state opt-out plan to the Congressional Budget Office. States would have until 2014 to opt out.

What does a public option with an opt out plan mean? That's still difficult to assess. Senator Gregg said it best.

Assuming that the states will opt-out of a federally subsidized
government-run plan is like assuming your children will opt-out of their

That is entirely accurate. It appears that the way that the public option will be structured there will be no motivation for states to opt out. After all, it will be paid for with federal taxes. What possible reason would a governor have to opt out? Their citizens would still pay federal taxes. As such, citizens of a state would pay for the public option but have no use of it.

This is an attempt at misdirection, and it isn't working, at least not so far. So far, all we know is that health care reform has lost Maine Senator Olympia Snowe who called it disappointing that it was in.

The Democrats have had a remarkable knack at making things less clear as the process has moved forward. We still don't know how this opt out option will work. Beyond that, we also don't know anything else. Will the doctor fix be in the bill? How will it be paid for? Things are still no less clear today after this much publicized announcement than they were before it. That is the general direction of the health care debate since the beginning.

More Privatization in Chicago?

a If the residents of Chicago thought the parking meter debacle went well, they may be in for a new round of privatization. This time the city's water system may be leased.

If the parking meter deal put a bad taste in your mouth, try swallowing this:Chicago is considering leasing its water system to help fix the budget.

The new boss could charge whatever they want for water, CBS 2's Roseanne Tellez reports.

Could it happen here in Chicago? It already has nearby. Homer Glen in Will County relies on Lake Michigan water, but the supply comes from a German-owned firm. Locals say there's a lot more than water going down the drain.

The parking meters are the most visible effect of privatization in Chicago, but the parking meter debacle is merely the most visible. Cook County Board Presidential candidate Tom Tresser told me that he fought a similar effort to privatize a park and sell it to the private school Latin High School in 2007.

Most people report that this rush to privatize is occurring because the city is cash strapped. Is that the reason? Of course, Mayor Daley isn't saying much. The privatization of the park to Latin High School occurred two years ago when things were booming and so that effort certainly couldn't be explained by a cash crunch.

One insider offered me a different motivation. In their view, privatization is occurring because the powers that be within the city government believe that it's much easier to shake down private firms than it is to run schemes within the city government. In fact, this view may have started with the city's Hired Truck Scandal. In that scandal, city officials shook down private trucking firms for millions in order to get contracts. Privatization cuts out the middle man and puts the city in direct contact with private firms. Furthermore, private firms are much more difficult to track. There's no Inspector General. They aren't required to give their taxes and other records to the public. So, corrupt city officials would have direct access to corruption, if of course, that was their motivation.

One thing that can't be argued is that privatization more often than not fails miserably to help the citizens of the municipality. The parking meters now cost exponentially more. In the story linked, another town is referenced that also leased their water to a private firm and the water bills have risen dramatically. Had the city leased the park to Latin High School it would have been used for that school's soccer field and thus unavailable to the residents of the city. We should thus view all attempts at privatization with skepticism.