Monthly Archives: April 2010

Posted on April 30, 2010 | Leave a comment

Around the states

NY Governor Paterson has said that 22% of New York State revenues come from Wall St taxpayers. The Governor has expressed concern that the proposed new laws may result in erosion of New York City’s status as the world’s financial center. We at Random Thots believe there is more pomp and circumstance than there is substance in the current condemnations of Goldman Sachs, et al. Some senators are making noise, but there is little to fear from the administration on this score. Still, it is a bit disturbing to see the reputation of our financial institutions tarnished beyond what would be necessary for honest reform.

The only state in the nation with a sizable population and without a budget shortfall is Texas. Others are Alaska, Montana, Wyoming and West Virginia. It is notable that all of them, including Texas are “red” states. They are states filled with the sort of people who take pride in self reliance and individualism. Their geography has help to save them from the fates of Oregon and Vermont whose natural beauty and proximity to liberal dominated populations have seen their cultures inverted by invasion from their neighbors.

If you are searching for a decent Democrat, a man of good character, you will find many. I would nominate Arnold Schwarzenegger. Oh, I know, he ran on the Republican ticket but he governs as would a Democrat. He may be the only (R) governor in the country to give full support to Obamacare. It will take a Republican to pull California out of the hole. Arnold won’t do it.

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Posted in News, Opinion

LIFE ON MARS

Posted on April 30, 2010 | 2 comments


Scientists say where there is scum there is life.
NASA has announced there is compelling evidence there was once political life on the planet Mars. All that remains are some pond scum. NASA also found gypsum which sounds to me like something the politicians must have done.
Life on earth
Obama has promised;
In the future “banks and financial concerns will pay for their own mistakes, taxpayers will not have to pay.” He did not say who will pay for government mistakes.
Life far, far away
Noted scientist Stephen Hawking promotes discrimination. He calls for us not to seek their friendship or even try to speak to aliens from outer space. This is no way to treat a minority group, and a super minority at that! However, I must admit, I would not want my daughter to marry one.

Bob B

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Posted in Satire

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CICERO SAID SO

Posted on April 29, 2010 | Leave a comment

“The Budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, assistance to foreign lands should be reduced lest the State become bankrupt. The people should … work and not depend on government for subsistence.”

Marcus Tullius Cicero in the year 106 BC.

So you see, some things just don’t change much over time, even a very long time. Surely Madison, Adams, Jefferson and that whole crowd understood this when they formulated the Constitution.

“It is a gloomy moment in the history of our country. Not in the lifetime of most men has there been so much grave and deep apprehension; never has the future seemed so incalculable as at this time. The domestic economic situation is in chaos. Our dollar is weak throughout the world. The political cauldron seethes and bubbles with uncertainty. Russia hangs, as usual, like a cloud, dark and silent, upon the horizon. It is a solemn moment. Of our troubles no man has seen the end.”

Harper’s Magazine  1847

Dare we Hope our beloved land will once again triumph over trouble as it did in the wake of Harper’s nineteenth century view? Or is Change changing our path to that once trod by Rome?

Bob B

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Posted in Political philosophy

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NOAM CHOMSKY QUOTED IN PRAVDA

Posted on April 28, 2010 | Leave a comment

Compares Tea Party to Weimar Germany

I thought Chomsky was dead, must have been confusing him with Howard Zinn. Noam is alive, but still not well. For if he were of sane mind he would not be expressing fear that a Hitleresque leader might emerge to lead the Tea Party and bring upon illegal immigrants and blacks what Hitler brought upon the Jews.

The article is here. It ends with Chomsky’s warning, “I do not believe that this is far from happening”. Chomsky has never sworn allegiance to the truth but in this case I believe he is sincere. Once you close your mind to objective truth you forfeit all connection to reality. Chomsky has allowed himself no knowledge of the motivation or goals of the Tea Party. He does not fear what they stand for because he does not know what they stand for. He fears the unknown, and trembles.

Bob B

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Posted in Political polemics

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GOLDMAN SACHS INVESTIGATIVE HEARING

Posted on April 28, 2010 | Leave a comment

Random Observations
Drudge headline – Goldman would be enriched by Dodd bill
Increased regulation hampers primarily the smaller financial institutions thereby strengthening the relative position of the biggest firms like Goldman Sachs.

Goldman Sachs gave just a tad less than a million dollars to Obama’s campaign fund.

The Democratic Party and its leader Obama are presuming Goldman guilty in the court of populist rhetoric and using the alleged offenses to justify new regulation.

The argument follows the line that it was fraudulent activity by Goldman Sachs executives that nearly brought financial ruin upon the United States and much of the rest of the world. Despite the severity of the alleged offense no criminal charges have been filed. Should they choose to do so, Goldman could seek settlement for a fine paid by the firm. Under the provisions of the Section 7 Fraud Statutes the fine would conclude the matter and effectively bar any follow-on lawsuits from injured parties.

Goldman’s customers are sellers for whom they structure and sell securities and investors who buy these same securities. Goldman’s statement that they “always put the customer first” is a snickerworthy pledge. Which customer? They represent both sides of the same transaction.

What is going on here is mostly politics. The inference that Goldman brought down the economy is absurd. That is not to declare Goldman innocent of wrongdoing. Nonetheless, it looks like Goldman is participating as a reluctant but willing scapegoat in order that regulation enacted might be favorable to them.

Bob B

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Posted in Political polemics

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RANDOM OBSERVATIONS

Posted on April 26, 2010 | 1 comment

God and the Soldier, we adore,
In time of danger, not before.
The danger passed and all things righted,
God is forgotten and the Soldier slighted.

~Rudyard Kipling

Warren Buffet, latest Democratic special interest.

Warren Buffet once said derivative are “financial weapons of mass destruction.” He is currently lobbying Congress to put a couple words in the financial reform bill that will enable him to hang on to his 63 billion dollar derivatives portfolio. The Wall St Journal points out,
“The battle over the provision shows how lobbying by businesses and lawmakers to insert just a few words into a complex bill can have a major impact on the country’s biggest companies.”

No More Beer Summits

Andrew Breitbart reminds us of the incident in Boston when a policeman temporarily detained an individual forcing entry into a house. Obama, knowing only that the policeman was white and the individual forcing entry was black assumed it was racial harassment. Obama held a beer summit of all involved by way of apology.

Breitbart suggests obliquely that another beer summit might be in order, one hosted by the spit and slur claimers. He has written a good summary of this incident that did not happen. Don’t miss it.

Bob B

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Posted in Political polemics

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THE WEEK IN WASHINGTON

Posted on April 24, 2010 | Leave a comment

Week ending April 23, 2010

Monday
Obama misses Polish President’s funeral
Heads of state from the smaller European countries found ways around their ashes to attend the funeral, Sarkozy and Merkel stayed home. Biden and Clinton express their sympathies to the Polish Embassy. Obama played golf.

New York Times reports Muslim outreach
Obama is becoming less cautious about speaking out for Muslims

Tuesday
GOP goes on fishing expedition
Asks for investigation into White House connection to Goldman Sachs case.

Biden lays it on.
Blames greedy banks for financial collapse

Wednesday
Grounds trembling under SEC case against Goldman Sachs
SEC charge is Goldman defrauded ACA by failing to disclose Paulson’s intent to short the portfolio ACA was assembling. Paulson aide says he informed ACA of Paulson’s intent.

Thusday
Obama and Biden both go to the scene of the crime to pump up some resentment
In a speech at Cooper Union in NYC Obama lays it on the greedy banks for causing the country’s economic problem. Biden carries the same water elsewhere in the city.

Friday
Obama slams Arizona immigration law
Claims law violates civil rights

About Washington Week in Review
It is our intent to publish this feature on Saturday in the future. The goal is to provide a handy recap of interesting events that occurred during the week, including some that may not have been given much attention in the major media.

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Posted in Political polemics, Uncategorized

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VAT FOR IDIOTS

Posted on April 23, 2010 | 1 comment

The Value Added Tax is an insidious invention we are about to import from Europe. It is like a sales tax in that it is a tax on activity, not on income or profit. It is like a flat tax, or fair tax, in that it cannot be escaped. It is an inflationary tax because it will increase the price of all goods to which it is applied. It is also somewhat of a hidden tax. Let’s explore each of theses facts.

The European Union mandates a standard minimum rate for the VAT each member nation must charge. The standard rate is 15% with allowance for some exceptions. Europeans are the most heavily taxed people anywhere. Income tax rates are roughly comparable to ours; it is the VAT that makes the difference. France gets 50% of their tax revenues from the Value Added Tax.

The VAT is insidious because it is applied at the wholesale level where you do not see it. It is quietly built into the price of everything. It is not in your face the way a local sales tax is. Efforts to increase the rate, or the list of activities to which it is applied do not meet with the same opposition as do efforts to increase income tax rates. Income tax is personal, value added tax is seen as something someone else pays.

Because it is a tax on activity, not income or profits, the justification for it is more convoluted. The concept is that adding value increases wealth. If you buy some lumber for $500 and build a shed with it that’s worth $2,000 you are $1,500 wealthier. The VAT taxes this increase in wealth as though it were income. It is only applied at the business level so you are not assessed personally, but the lumber will cost you more.

The VAT cannot be avoided because it is an indirect tax. It is similar to gasoline in that federal and state taxes are built into the price. Everyone pays it. From members of the underground economy to Bill Gates, they all pay, and pay the same rate.

It is inflationary because it increases the cost to produce, and therefore the price, of a broad array of goods and services. In Europe it is assessed on everything from cell phones to restaurant meals.

It is somewhat hidden. The gasoline tax is again a good example. In most states the tax is right on the pump but do you know what it is in your state? Most of us only care about the price on the big sign we can read as we drive by.

The Value Added Tax should not be confused with the Flat Tax or the Fair Tax. There are similarities and differences, the most significant being the Flat and Fair taxes are replacements for the Income tax, the VAT is in addition to income tax.

Bob B

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Posted in Political philosophy

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FORDHAM RUNNER LEAPS HOME

Posted on April 22, 2010 | Leave a comment

Here is a baseball play that justifies the cliché, “it’s gotta be seen to be believed”.

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MADOFF WITH SOCIAL SECURITY

Posted on April 21, 2010 | Leave a comment

This is not original work and I do not know the author to whom to give credit. Whoever it was, they did a good job comparing how Madoff made off with investors money and how the government has made off with our contributions for Social Security.

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Why did Bernie Madoff go to prison? To make it simple, he talked people into investing with him. Then he didn’t invest their money. He simply took the money from the new investors to pay off the old investors. Finally there were not enough new investors coming in to keep the payments going. Now Madoff is one of the most hated men in America.

Madoff did to his investors what the government has been doing to us with Social Security. There is no meaningful difference between the two schemes except that one was operated by a private individual who is now in jail, and the other is operated by politicians.

Here is a side-by-side comparison.

BERNIE MADOFF SOCIAL SECURITY
Takes money from investors with the promise that the money will be invested and made available to them later Takes money from wage earners with the promise that the money will be invested in a “Trust Fund” and made available later.
Instead of investing the money Madoff spends it on nice homes in the Hamptons and yachts. Instead of depositing money in a Trust Fund the politicians use it for general spending and vote buying.
When the time comes to pay the investors back Madoff simply uses some of the new funds from newer investors to pay back the older investors. When benefits for older investors become due the politicians pay them with money taken from younger and newer wage earners to pay the geezers.
When Madoff’s scheme is discovered all hell breaks loose. New investors won’t give him any more cash. When Social Security runs out of money they simply force the taxpayers to send them some more.
Bernie Madoff is in jail. Politicians remain in Washington.

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In a corporate pension plan the corporation makes a pension promise to employees then backs it up with annual cash contributions into a trust fund. The fund then invests in a broad spectrum of securities. If the trust fund managers were to give the money back to the corporation and call it a loan it would be an abuse. The trust would be a sham. But that is exactly how Social Security works.

Funds are withheld from our wages. Our employer matches the amount taken from us and sends the total to the Social Security division. The Social Security  division sends it to a trust fund. The trust fund uses it first to pay current retirees then gives the balance to the federal government to do with as it pleases. The federal government thanks the Social Security division and gives them an IOU called a bond. No investments are made. There is no money in the trust fund, only IOU’s.

Our Social Security scheme is indeed a Ponzi scheme.

Bob B

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Posted in Political philosophy

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