At last a reason to vote for Uncle Bernie Sanders. Bear in mind that the only adjective he knows is “free”. So if were elected we should assume that he will provide each and every one of us for FREE the substance that is present in every bong used by members of the Obama administration. It has hallucinogenic properties that Timothy Leary could only have dreamed about.
The most recent person to appear in public under the influence is Janet Yellen, Chairperson of Federal Reserve. She actually described the US economy as “solid” which leads many to conclude that she is unacquainted with the dismal science or, in her case, the rose colored science. She made this statement despite the whiplash inducing first quarter growth of 0.8%. It is difficult to imagine what she would describe as a weak economy.
Before that our President, after a whack from the White House bong, suggested to an audience of incredulous sycophants that his legacy would include the ludicrous assertion that he had saved the world from a great depression. Sadly this exercise in self-adulation was greeted with something other than hysterical laughter.
Shortly thereafter the big O made the more modest claim that the US economy was better, by all objective measures, than when he took office. He must have been briefed by Ms. Yellen before he told this whopper. The very next day it was announced that the roaring Obama recovery had generated 35,000 jobs in the month of May (was he not told about that data point before he engaged in his vainglory?). In addition another 500,000 people dropped out of the labor market because they could not find work (if he was told this did he understand what it meant?). This means that there was a net reduction of 465,000 workers and only by using common core math principles could this result in a reduction of the unemployment rate. The key to all good comedy is timing and our leader has near perfectly bad timing.
During the Republican presidential debates Carly Fiorina made a wonderful argument that was studiously ignored by everyone who should have been paying attention. Her point was that the relative size of organizations is driven in large part by the corresponding size of the US government. It is axiomatic that when the federal Leviathan consumes 25% of the GDP and issues endless rules and regulations only large businesses can survive and prosper. Note that over time when the federal government has grown it is followed inexorably by a corresponding increase in consolidations, mergers and acquisitions.
Under the boondoggle known as Superfund the EPA hornswoggled a pliant court to impose joint and several liability on all parties who, directly or indirectly, introduced chemical waste into the stream of commerce. I was in the room when a lawyer asked a government thug the following question: If my client agreed to dispose of material at a site but after the truck arrived at the site the company decided not to dispose of the material at the site would that company be jointly and severally liable for the entire clean-up? The answer, not surprisingly, was yes. Several months later I was involved in a case under the Superfund law and the government attorney wanted to discuss a settlement. She did not help her cause by insulting me at the start the conversation…she asked me if I had attended Harvard! When asked to settle the case by providing a blank check and turning the clean-up over to the EPA (akin to asking the Three Stooges to paint your house) I dissolved in laughter pointing out that there was no incentive to settle because the EPA was systematically putting our smaller competitors out of business. The concept was beyond her comprehension. She did attend Harvard.
The book “America’s Bitter Pill” by Steven Brill describes the drafting and passage of Obamacare. It is a wonderfully depressing tale of economic ignorance (note the theme), political horse trading and general incompetence. What stands out is that every few pages you get to read about some acquisition or merger that concentrates the “competitors” in the medical field. Hospitals, pharmaceutical firms and health providers growing in size because only large organizations can survive and prosper in the bureaucratic maze that is Obamacare. You will note that almost every village, town or city has at least one intersection which has on three of the corners a CVS, a Rite-Aid and a Walgreen’s. Try to find a small privately owned pharmacy today.
At one time there were over 100 automobile manufacturers in the US. Today there are three US firms: Ford, Chrysler and GM and two of those have been taken over by the federal government. However the banking industry provides the best example. They are reviled by the left but when things go south they are suddenly too big to fail. The biggest financial institutions are major contributors to left wing candidates such as Hilliary Clinton. In addition they are subject to a myriad of arcane rules and regulations that require a team of Wall Street lawyers to understand and circumvent. Smaller enterprises cannot withstand such costs. And in the end they are essentially run by the government…this, by the way, is the essential element of fascism.
So how does the government influence bank policy without sitting in the board room? Take the economic meltdown driven by the collapse of the real estate market. The hapless Carter Administration gave birth to the Community Reinvestment Act in 1977. But it was the first Clinton Administration (ponder that statement and head for the White House bong) that used it to create a banking crisis.
Step One: Manufacture a totally bogus argument that bank lending is discriminatory. A “study” “demonstrated” that banks declined loan applications from minority candidates at a higher rate than those submitted by whites. Strangely the foreclosure rates were approximately the same for both white and minority borrowers suggesting that proper financial analyses had been applied and the candidates had been held to the same standard. Not good enough for the jackbooted regulators in Washington. Conclusion: the industry was awash with racism.
Step Two: Require the banks to grant loans at an equal rate to white and minority candidates without regard to normal financial tollgates. The inevitable (to a rational person) result is the provision of mortgages to a number of applicants who had lower incomes and worse credit than would ordinarily be acceptable. Then act surprised when there are worthless mortgages papering the walls of banks across the country. Please note that the bulk of the fly-by-night mortgage firms made significant financial contributions to any party not called Republican.
Step Three: Bail out the biggest banks, let the small banks disappear and issue regulations ensuring that only those banks that are too big to fail can survive.
Indeed size matters when you dealing with a progressive government doing its very best to help the little people.