Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at thinking, intelligent individuals, whose comments are very welcome.

"No matter how vast your knowledge or how modest, it is your own mind that has to acquire it." Ayn Rand

08 August 2009

Putting the Fox in the Chicken Coop

While the recession was actually initially the result of the sudden rise in oil and gasoline prices in 2007 and started first in many other countries throughout the world, the popular mythology is that it started in the U.S. and was due to sub-prime mortgage loan defaults and errors of our financial institutions. The later did make the recession worse and those failures came home to roost suddenly due to the effects of the initial recession caused by the oil and gasoline price spike. Congress, in its usual tradition, responded by claiming that the fault was that entirely of Wall Street and our banks and called for more regulation of those private institutions.

The Congress that wants to regulate the banks and the financial industry more, itself hugely contributed to the problems we recently experienced with more stringent requirements being added to the Community Reinvestment Act and with their encouragement given to Fanny Mae and Freddy Mac to buy up risky home mortgages so they would pass them on to investors.

I am presently reading Glenn Beck's Common Sense. He reminds us that Congress has a history of managing its own bank. The House of Representatives had a bank of their own. The customers were the Representatives themselves. They bounced 8,331 checks and had to close their bank. It had no penalties for overdrafts, so Congressmen apparently felt little responsibility for not writing checks in excess of their balances. Guess they got used to doing that with the balances of taxpayer money in the U.S. Treasury, which were never large enough to cover their spending habits. They always felt free to overdraw that balance and apparently felt equally free in overdrawing their personal balances.

Of course, no Congressman was ever held accountable for these overdrafts of the House Bank, just as they are never held accountable for overspending tax revenues. But, Congressmen are always ready to have someone else take a fall for them. In the case of the House Bank, they had the House Sergeant-at-Arms sentenced to 24 months in jail. Similarly, instead of taking the blame for their role in encouraging sub-prime and risky home mortgages, they blamed the banks and Wall Street financial institutions. They proposed more regulations to be determined by themselves to correct any such future problems. They also responded to the financial portion of the crisis by taking a financial role in 500 American banks, including most of the largest banks in the country.

Do not let it be said that the House of Representatives is ever slowed down in expanding its powers, at the expense of further violations of our Constitution, by any rational assessment of its own competency. No, these people are absolutely lacking in any power of introspection and self-evaluation. Such people are truly dangerous when vested with immense power.

And now they also want to exercise much more control of our health care and our energy production and use. What do you suppose their competency is in those fields?

In the field of health care, we already know a great deal from the history of Medicare and Medicaid. They have allowed huge cost overruns in both programs and run up huge debts with both. They have responded by decreeing too low doctors fees and hospital charges in some areas, which has led to doctors and hospitals desperately padding their bills and transferring many costs to their private patients. This is a big factor in the high rate of increase in health insurance costs, which Congress now uses to try to justify its taking still more control of the health care industries. The fox is already in the chicken coop here, but he wants to bring in his vixen to help him slaughter the chickens at a faster rate.

In the field of energy production and use, Congress also has a long history. Since Jimmy Carter, there have been massive government programs to develop alternative energy sources. Many years of research and development and pilot programs and what do we have to show for it? Damn little. Only about 2.4% of the electricity generated in the U.S. is from renewable energy sources other than the old standby of hydroelectric power. Much of that is used only because of state and federal mandates and due to subsidies. In other words, it is still not price competitive after all these years. Congress has been effective in preventing any rational plan for the storage of nuclear waste, which has greatly hurt the nuclear power industry.

For transportation purposes, Congress has given us huge subsidy programs for ethanol. Ethanol from corn actually provides no new and no net energy. It is just a conversion program to turn corn food into fuel while using up equal amounts of energy produced by other energy sources. This program is very effective in driving up the cost of food as well. Congress has also been very effective in thwarting all efforts to discover and produce more oil and gas in America and offshore.

Once again, Congress has shown no competence in the field of energy use and production. But, this weasel is in the chicken coop and causing havoc. The weasel now wants to hugely expand its powers with carbon cap and trade taxing and mandating. The weasel is not yet satisfied with his chicken slaughtering capability. No, it wants to bring its bitch or jill into the coop to speed up its rate of kill.

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