Posts Tagged ‘Charlie Rose’


Obamacare becomes law on 3/22/10

OK. I let this settle for a couple of days as I usually do. One of the problems with Internet news groups is too many people popping off instantly in reaction to another post. A little reflection is better.


I think the law is unconstitutional. That is not to predict the U.S. Supreme Court will agree with me. I have no idea about that.

It violates the Tenth Amendment:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

The public seems to think the federal government outranks the state governments and the people. No. The opposite is true.

The Dems claim they can pass Obamacare under the “Commerce Clause.” But that says nothing about individual Americans. It states, in Article I, Section 8 that Congress shall have power “To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.” Its purpose is to prevent states from charging import duties on stuff coming in from other states or countries. It’s a stretch to extend it to forcing citizens to buy a private product or service. But the Supreme Court is famous for stretching the commerce clause in the past.

Ironically, I think the federal government may have the right to establish a single-payer health insurance system, which is somewhat similar to social security, a mandatory pension plan for all workers in the U.S. I actually think social security is unconstitutional, but that question has already gone through the Supreme Court and they upheld it.

There are also provisions that seem to me to violate the Fourteenth Amendment “equal protection” clause. You have to treat everyone the same. NE, FL, and LA do not get a better deal than the other 47 states.

ObamaCare may be a tax on the states that is not permitted by the Constitution. The original Constitution allowed only a head tax. Income taxes were declared unconstitutional as a result. The Sixteenth Amendment allowed Congress to tax“ incomes.” But Southern states have paid lesser Medicaid benefits than Northern states. ObamaCare forces Southern states to pay more for medicaid. As such, it is neither a head tax nor an income tax.

‘The process’

There was much talk in the media about the Dems violating House and Senate rules. That did not happen. The law that was signed was passed by 60 Senators on Christmas eve. The House passed that bill according to their normal majority rule. Deeming was not used. I do not know what they are going to do to “fix” the Senate version to make it more like the House wants. Normally, they go to conference then the resulting compromise has to pass both houses which subjects it to the Senate 60-vote cloture rule.

I surmise they are going to use reconciliation to pass the compromise version to avoid the need for the 60 Senate votes they no longer have. That arguably violates the rules pertaining to reconciliation, but the Vice President can overrule the Senate Parliamentarian and he will. The Constitution says the House and Senate can pass their own rules. The Vice President’s power to overrule the parliamentarian is one of those rules. No unconstitutionality.

All that all of this means is the Dems are darned lucky Harry Reid met one of their arbitrary deadlines on Christmas eve.

Were the bribes to get those 60 votes sleazy? Absolutely. The whole Congress is sleazy. You get in there by winning a best- liar contest back in your district or state.The president is sleazy. He won the best-liar-in-the-country contest.

Hey, the Dems squeaked it through. If the Supreme Court does not overturn it, those who do not like it need to elect a new Congress and President to repeal it. It’s as simple as that. Read the Constitution.

‘Doing nothing was not an option’

Obama kept saying that the Republicans wanted to do nothing. He lied. The Republicans CAN do nothing because they are in the minority and do not control the White House.

Obama also said that health care as now operated in the U.S. is unsustainable.

That is correct. The costs are way too high compared to other countries and the rate of increase has been way too high.

Then Obama said the fact that current costs are unsustainable means we have to do “something.”

“Something?” What does that mean?

To Obama, it seems to mean “anything” as in “Anything is better than nothing.”

That is not correct. The action we need to take is to change the way medical care is purchased and paid for in ways that reduce the costs to more appropriate levels without causing new problems.

It is not clear what that would mean. I would expect we would need to study health care systems around the world and either copy the best one or a least use ideas from the best. I have read that Germany and Singapore have universal health care systems that work pretty well. Germany’s was started by Otto von Bismarck in the late 1800s and has survived two world wars, Weimar Republic hyperinflation, and more than a century. It works through private insurance companies. Basically, Germany helps its citizens buy private insurance. Germany and Singapore also have very successful economies. The rest of Europe is a mess being bankrupted by their versions of ObamaCare.

The premier of Newfoundland, Canada recently came to Florida for medical care rather than use his country’s universal system. I am told the affluent in Canada do that to avoid Soviet-style customer service and lowest-common-denominator, we’re-all-equal treatment of people who are used to going first class. Apparently, one of the unwritten ways Canada pays for its health care is to charge the rich for it, then drive them to pay again for better service in the U.S. like what’s done to those who send their kids to private schools in the U.S. (By the way, did you know Newfoundland used to be its own country. It could not pay its bills so the U.K. annexed it into Canada.That was called gunboat diplomacy. Apparently, they still cannot pay the bill for quality health care service.)

Was Obama’s version of “doing something” better than doing “nothing?

Are you kidding? The “problem” was high costs. What does ObamaCare do to lower costs? Absolutely nothing. Part of it spends billions on attacking waste, fraud, and abuse. They should have attacked waste fraud and abuse in 1965 when Medicare started. The anti-fraud billions raise costs. Whether the money will produce a a net benefit when you achieve savings and subtract the cost of the achieving them remains to be seen. Actually, I do not need to wait. There is not a snowball’s chance in La Jolla that waste, fraud, and abuse will be eliminated or even reduced. It is endemic to all government activity. Indeed, I am certain that the bureaucracy created to stop waste, fraud, and abuse will itself have the usual amount of waste, fraud, and abuse, thereby making the waste, fraud, and abuse worse.

ObamaCare is to fixing the high-cost problem of U.S. health care what shooting gasoline from a fire hose is to putting out a fire.


Is ObamaCare socialism? Yeah, of course. So are Medicare, Social Security, and Medicaid. Socialism is not a pass-fail question. It is a matter of degree. Pure socialism is government spending is 100% of GDP. Pure capitalism is 0%. Our spending in 1903 was about 17% of GDP and is now about 45%.

Here is a Web site that says the U.S. spends 19.9% of GDP, 144th out of 160. This is 2006 data. Other major countries on that table come out like this:

Japan 103rd 30.9%
Switzerland 76th 37.8%
Germany 41st 48.8%
U.K. 37th 50%
France 7th 61.1%

Single payer

Obama denies it now, but in the past he said he was a single payer guy. That means total government takeover of health care. All doctors, pharmaceutical companies, hospitals, and medical equipment manufacturers are paid by a single payer: the federal government. That’s the Soviet, Cuban model.

Here is a YouTube of Obama saying this. I saw him confronted with it by a media interviewer. His response: He claimed he could not hear what he was saying on the video they played for him.

That’s lame and he knows darned well what he said. Transcripts of it are all over and Obama and his advisers have discussed it behind closed doors. “I can’t hear it” is the best they could come up with? “I changed my mind” might, I repeat, might be believable. “I can’t hear it,” is not believable.

In the video, he says, “we may not get there immediately.” ObamaCare 2010 is not getting there immediately. But make no mistake, every single hard- core proponent of ObamaCare regards it as merely the camel nose inside the tent. They are not stopping with ObamaCare. They will push for moving to single payer or closer to it as soon as they think they can get away with it. And they will not stop pushing for single payer until they get it. Shame on the American people who believe the Dems have abandoned their dreams of single payer. 2010 ObamaCare is to the left what Czechoslovakia was to Hitler. The British agreed to let Germany have Czechoslovakia to get an agreement that they would seek no more territory. It was called appeasement. The Peace in Our Time Munich Agreement was signed by the British and Germans on 89/30/38. Germany invaded Poland starting World War II in Europe on 9/1/39. Americans who oppose single payer but who are OK with 2010 ObamaCare are clones of British prime minister Neville Chamberlain who sold out the Czechs for a worthless agreement that Germany would seek no greater territory. The left will pursue single payer until they get it and they will use ObamaCare to get American addicted to government health care so they can later get single payer.

The next step will be leftists using ObamaCare rules and law to drive all health-insurance companies out of business. Then they will say, “See!? We told you those people were no good. We’ll take care of you now. And be sure to vote Democratic in the next election—if you know what’s good for you.”

Effects of government intervention

Socialism doesn’t work. Government intervention makes things worse. Here is what I expect will happen as a result of ObamaCare:

• The best and brightest Americans will stop going to medical school.
• Medical students interns and residents will abandon medical school and medical careers.
• Current American doctors will quit the profession or retire early.
• More hospitals and doctors will refuse to take Medicare patients. The Mayo Clinic refused to take them before ObamaCare.
• Your heath insurance plan, and doctor, whom Obama assured you that you would be able to keep, will shut down and no longer be an option.
• The addition of 32 million new insureds and the reduction in the number of doctors will result in a severe doctor shortage that will be partially taken care of by importing Third World doctors who cannot speak or understand English well enough to adequately understand your symptoms, adequately explain your situation and therapies to you, or establish any sort of cultural or personal rapport with you.
• The same will be true of nurses.
• The U.S., which is the last country to aggressively seek new medicines and medical devices, will stop doing that because of lack of profit incentive. The number of new patents for new medicine and equipment will flat line worldwide. Tenured University personnel will putter around continuing efforts to develop new therapies, but without the profit motive, they will do so only at glacial speed. Recently, the rest of the world has gotten away with not doing medical research cause they could count on us to do it for the whole world. When, we, too, allow a government takeover of all health care, neither we nor the rest of the world will be able to benefit from technological progress.
• All prescription medicine will become generic in about 17 years (patent term)
• Hospitals will deteriorate and age more than in the past. As in rent control, the building owners will have no incentive to rehab or replace them.
• Waiting lines will get unbelievably long. Waits for appointments will get longer.
• Many therapies and diagnostic tests will be rationed because the equipment or medicine is expensive.
• All medical personnel from doctors to nurses to orderlies to janitors to administrators will unionize and seek and get generous benefits like retirement when they are in their 40s, suspiciously high rates of disability, cost-of-living adjustments to pensions, high pensions.
• the best people and managers will leave health insurance companies to be replaced by gum-chewing, union, it’s-not-my-job, bureaucrat drones

Author of Is the Welfare State Justified?

On 3/28/10, I heard a brief interview with Professor Daniel Shapiro of WVU. He wrote the book Is the Welfare State Justified?

Basically he said that those who favor government health care and all that are even wrong when judged on their own priorities. Liberals say their priorities are right and those of the right wrong. Shapiro says, OK, let’s use your priorities. He then shows that the priorities of the liberals—like social justice, fairness, and egalitarianism—are better served by letting the market run health care. His evidence is to show how actual market and government health care systems around the world work. For example, in government-run health care systems, the poor end up at the back of long lines and waiting lists for health care. The rich pull strings, use connections, or spend money to get better health care and better service. Plus, the government-run system costs more so there is less health care for everyone, especially the poor, than in a market system.

Shapiro agrees with me that the proper health care delivery system is the 1970s and before approach. You pay out of your own pocket for routine and semi-routine and moderate cost care—like car insurance. And, as in car insurance, you have major medical insurance that only covers catastrophically high-cost care.

Essentially, that is what we will have, either because we are smart enough to recognize it, or because we act like idiots and bankrupt ourselves in which case we will be forced into the pay-your-own-way plus major medical system because we cannot get anyone to lend us the deficit spending necessary to offer Santa Claus level universal health care with no deductible.

Pre-existing conditions

Both Republicans and Democrats agree that pre-existing conditions have to be covered by health insurers. Good for them, but they’re nuts.

By definition, insurance cannot cover pre-existing conditions. Insurance covers risks. There is no risk in a pre-existing condition.

The answer to pre-existing conditions is pre-existing insurance. My sons were covered from birth. That ought to be the case with everyone.

What about people who for one reason or another did not do that or had gaps in coverage which caused them to be disqualified when they attempted to get new insurance?

1. Pay out of your own net worth for the needed health care. Your pre-existing condition is certainly not any one else’s fault.
2. Seek charity from relatives, friends, organized charities.
3. When you run out of money or private charity, go to Medicaid.

A bigger picture solution is to end government and employer involvement in health insurance. This was sort of done with pensions. It used to be that those who lost their job lost equity they had built up in company pensions. The pension was switched to the person, not the company, with 5401(k)s, IRAs, SEPs, and so on. Good law.

The same should be done with health insurance. You buy it from an insurance agent like car insurance or fire insurance, not through your employer. The stupidity of employers providing health care started during World War II as a way to get around another stupidity called wage and price controls. It was a way to give raises. Employers have better things to do than provide health care or insurance, like employ people. The requirement that they provide health insurance deters starting new businesses and expanding them. Everyone should buy their own health care and health insurance the way they buy food, clothing, housing, and so on. That would fix the high cost and rapid price increases too. Only bureaucrats tolerate high, rapidly rising costs. Consumers would shop around and refuse overly expensive treatments.

Letting people with pre-existing conditions buy health insurance that covers that condition is like letting you buy life insurance on dead people or letting people at the race track bet on races after they are over. It’s stupid on its face. People with pre-existing conditions don’t need insurance. They need to pay for their care themselves or get charity.

Essentially, people with pre-existing conditions have long been covered for health care by Medicaid. The real problem is that middle class and affluent people want someone else to pay for their misfortune. They do not want to have to burn through their net worth until they qualify for Medicaid. I understand the economics of their motivation. What I do not understand is why they do not see the economics and fairness in mine. Sorry about your pre-existing condition, but no you may not bankrupt me, my children, or my country to pay for it. You pay for it until you are bankrupt. Then become a ward of the state.

With ObamaCare, the law will now “cover” them, but only briefly before trying to do that bankrupts the insurance companies and the country.

End lifetime policy limits

Another “we can all agree” provision is prohibiting insurance companies from putting a lifetime cap on health care coverage.

Why don’t we repeal the law of gravity while we are at it? That would eliminate injuries from falls.

We cannot force insurance companies to end limits on the amount of are they will provide. They are not bottomless pits of money. All insurance policies have limits.

Of course, ObamaCare went ahead and outlawed lifetime limits anyway. Enjoy it while it lasts. It will bankrupt the companies then the country.

Bankruptcy of the U.S. government

We have been told for decades that Social Security alone will bankrupt the country. It will. The first of the 78 million Baby Boomers still have not yet started collecting. They have to be 67 to get full benefits that are not reduced by their other income. Social Security went into the red—outlays exceeded inflows— in 2008 for the first time in history. The first Baby Boomers turn 67 on January 1, 2013. You have to be 65 to get Medicare. The first Baby Boomers turn 65 on 1/1/11. The 12/9/09 Daily Paul—Congressman Ron Paul’s web site—says,

The 2009 Social Security and Medicare Trustees Reports show the combined unfunded liability of these two programs has reached nearly $107 trillion in today’s dollars! That is about seven times the size of the U.S. economy and 10 times the size of the outstanding national debt.

Actually, the current national debt is

An Internet article said his about Medicaid unfunded liabilities:

In the next 50 years, Medicaid, the program for the poor — broadly, sometimes very broadly defined — could become a bigger threat than Medicare to the nation’s prosperity.

Even Barack Obama says current U.S. fiscal behavior (spending, taxing, and borrowing) is “unsustainable.” He’s right. Everyone says that. They are all right.

But no one, I repeat, no one, is doing the slightest thing about it. Obama says ObamaCare will reduce the deficit by $118 billion in the next ten years according to the Congressional Budget Office. If you believe that, you are too dumb to vote. Please stay away from the polls. Second, even if it were true, it is a drop in the bucket. The problem is over $100 trillion. $118 billion is one tenth of one percent of the $100 trillion problem.

Basically, the bond market and/or foreign exchange market will go on strike with regard to the dollar at some point. It’s called a run on the dollar. Anyone who owns dollars or dollar-denominated assets like U.S. government or corporate bonds worldwide will frantically try to sell them. That will drive up interest rates dramatically. It may be that no one will buy dollars or dollar bonds at all. In that case, the Congress and the President will not be able to deficit spend. They will have to raise taxes or cut programs drastically to pay the government’s bills. In fact, they will simply not have the money to pay pensions, bond interest and principal, government employee salaries, government bills for ammunition, fuel, electricity, and so on.

That was going to happen without ObamaCare. ObamaCare greatly accelerates it.

So in the end, the issue is not how Obama Care will hurt health care. The issue is when will ObamaCare and all the prior entitlement programs stretching back to 1933 cause the world financial markets to say “No more.” I saw a Harvard economist get asked when that will happen on Charlie Rose or some similar show in 2009. He thought a moment and said,

Five years—not ten.

In other words, he expects the U.S. to go bankrupt in 2015, 2019 at the latest. It’s really not possible to tell. It depends on events worldwide.

ObamaCare, therefore, is not something that you will experience in a hospital or doctor’s office. It is something you will experience on Fox Business TV, Wall Street, at your bank, your 401(k), your IRA, and, after the bankrupt federal government figures out how to pay the judges and bailiffs, in your recently re-opened local bankruptcy court.

Can the “greatest country in the world” actually go bankrupt?


Are we in a post racial America?

On 2/16/10, I saw a Charlie Rose show about whether America is now post-racial. Three black guys and a white New Yorker writer.

I’m white. Nevertheless, I think they got it wrong. Here is the correct answer.

We are post-racial in many aspects of American life. It happens by littles. Another bit of poetic phraseology that captures it is Edna St. Vincent Millay’s,

‘Tis not love’s going hurt my days,
But that it went in little ways.

I think the problem of America’s race hustlers

’Tis not racism’s going hurt my days
But that it went in little ways.

On February 7, 2010, more humans watched Super Bowl XLIV than had ever previously watched any TV program in the history of the universe. The losing coach was black. No one took any note of his race.

That is post racial.

Did that happen because of Barack Obama’s election? No. It happened because of Super Bowl XLI. That was the first Super Bowl where there was a black head coach. In fact, it was also the first where both head coaches were black (if you count mulattoes like winning coach Tony Dungy as black).

A very similar thing happened in the 1984 Miss America Pageant. The first African American winner happened that year. You know her name: Vanessa Williams. But you may not recall the first runner-up, in spite of the fact that she became Miss America when Williams was forced to resign when sleazy nude photos of her surfaced. That first runner-up, Suzette Charles, was also black.

The fact that you do not remember her name is because she was post-racial.

You know the name of the first African-American to play Major League Baseball—Jackie Robinson—but you probably do not remember the name of the second (Larry Doby) unless you are a baseball trivia expert. (I actually knew his name—probably because I wrote a book on baseball coaching.)

Robinson was racial. But because of him, the subsequent black Major League Baseball players were post-racial—way back in 1947.

How about the first black American to lose his life in the Revolutionary War? Many educated people know his name: Crispus Attucks.

Who was the second? I don’t know, because he was post-racial, even though he died way back in the 1770s.

In 1965 Bill Cosby became the first African-American co-star in a dramatic television series (I Spy). Who was the second? I dunno. Whoever they were, they were post-racial.

Throughout American life, minority pioneers, blacks, women, jews, Irish Catholics, and so on have punched through ceilings. Once the hole is made in the ceiling, all successors are post-racial or post-gender or post-religious bias or whatever.

Is Barack Obama post-racial?

Hell no! The guy’s the poster boy for a racist policy—affirmative action. He’s also a mulatto like Dungy, although blacks and whites seem to have a “close enough for government work” position regarding the “blackness” of mulattoes. Obama consciously used his blackness to get into college, law school, and politics. He used it to get into the Oval Office, a job he would not now have if he were identical in all respects except 100% white.

One sign that we are in a post-racial world will be when we stop calling mixed-race people like Tiger Woods (25% black), Barack Obama, and Halle Berry (50% black) black.

Barack Obama is the opposite of post-racial. So was Jackie Robinson. But Robinson became the first black baseball player on merit. The racism was in how long it took to happen and how many other blacks of equal or greater merit had been passed over because of their race. Same applies to Cosby, Williams, and so on.

Barack Obama has gotten nowhere on merit. He might have, but he never even tried, apparently because of lack of belief that he could.

But probably his first black or “black” successor as president will be post-racial because of Obama—because people have the same “close enough for government work” attitude about affirmative-action “achievements” as they do about percentage of black blood. Obama’s first black successor will be post-racial not because of the content of Obama’s character, but merely because of the color of his skin. Jackie Robinson’s successors were post-racial because of the content of his character.

Is America now a post-racial society?

Getting there, little by little. A pioneer here, a pioneer there. They all add up. It is not a yes or no question as Charlie Rose and all the others keep posing it. It is a matter of percentages of areas where a black has not yet succeeded. It is a spectrum. Areas of American life where blacks cannot succeed are racial. Those where they have broken through are post-racial. The percentage of racial areas is shrinking like a wet spot on a blackboard. Black coaches, black quarterbacks, black tennis players, black golfers, black congressmen men and women, black movie stars, black generals, black recording artists are now old hat. The real black leaders are those seccessful pioneers, not the self-proclaimed ones like Jesse Jackson.

How will we know we have entered a post-racial America? It will not be a single big event. Like General Douglas MacArthur’s “old soldier,” racism in America will never die, it will just fade away. It has faded away to a large extent, in spite of the efforts of race hustlers like Jesse Jackson, Al Sharpton, and Barack Obama to keep it alive, while crying crocodile tears about it’s still being alive, so they can use it to gain power.

The arrival of post-racial America will be marked not by what happens then, but what stops happening, namely, asking whether we have arrived at a post-racial America.

John T. Reed

I appreciate informed, well-thought-out constructive criticism and suggestions. If there are any errors or omissions in my facts or logic, please tell me about them. If you are correct, I will fix the item in question. If you wish, I will give you credit. Where appropriate, I will apologize for the error. To date, I have been surprised at how few such corrections I have had to make.

The human national treasures we do not value enough

When Tim Russert died unexpectedly, I was moved to name others who I feel are living human national treasures whom we do not appreciate enough.

These are talented, diligent men and women who are successful enough that we have heard of them. But they stand above other prominent people for their character. They seek position and ratings and raises, but not at the cost of doing what’s right. Their highest priority is doing what’s right, not what gives them status or money or fame. They comply with the ideal set forth in the Frank Sinatra song My Way.

They are also like John F. Kennedy’s Profiles in Courage heroes only without the one big, famous, dramatic conflict. But we have to know that these people on my list below have fought a million little, behind-the-scenes battles to maintain their integrity as they have lived their lives. They tell people what they need to know, not what they want to hear. They also remind us of Henry Clay’s statement, “I’d rather be right than be president.” That is, they have a vision of how they want to live their lives and they will not compromise it for any of the enticements that tempt others to live their lives so as to win the approval of others. People who do this are extremely rare.

Scott Adams, Dilbert cartoonist, lives a couple of towns away from me; we each were recruited to our first post-civilian-university jobs by Crocker National Bank in San Francisco; I left Crocker the year before he arrived; his cartoons are based on his experiences at Crocker and at PacBell where he subsequently worked, as well as on ideas from readers
Glenn Beck, radio and Fox news TV host, libertarian who is more than any of his competitors a teacher of facts and logic pertinent to the major policy issues of the day. As with Limbaugh, he is dismissed by the polite-company crowd because of his clowning around. When asked about that, he made some answer along the lines that he regretted the loss of the serious people but that he would rather that than to have Charlie Rose’s audience size. The best teachers and professors also use dramatization and clowning effectively. If Beck and Rose viewers were quizzed on the issues of the day, Beck’s viewers would outscore Rose’s by a large margin because of his persistent teaching. PBS was originally called “educational TV.” The Glenn Beck show is educational TV. PBS, on the other hand, has been running Rich Dad Poor Dad get-rich-quick infomercials.
John C. Bogle, author, founder and former CEO of Vanguard Mutual Fund Group
Dr. Michael Burry, erstwhile medical doctor who switched to stock market investing, tells people what they need to know, not what they want to hear, incentivizes himself to serve his investors first, limits their number and prohibits withdrawal for at least one year, very contrarian approach (I am the author of The Contrarian Edge for Football Offense), has no filter
Ward Connerly, effective opponent of affirmative action, former University of California regent, leader of several state ballot initiatives to ban affirmative action in CA, MI, and NE
Jamie Dimon, top banking executive at American Express, Commercial Credit, Citigroup, Bank One, and JPMorgan Chase—a guy who frequently did the right thing when most of his peers were doing the wrong thing (he graduated five years after me at Harvard Business School)
Steve Eisman, honest stock market analyst (all but a contradiction in terms other than Eisman), the hero of Michael Lewis’ book The Big Short, called the subprime crisis before it broke, has no filter
John Gagliardi, head football coach, St. Johns University; most all-divisions victories of any college football coach; unique approach to coaching
Bill James, author, baseball statistician, historian, Senior Advisor on Baseball Operations for the Boston Red Sox.
Steve Jobs, Apple cofounder and CEO, Apple Computer, Macintosh, Pixar, iPod, iPhone, iPad
Charles Krauthammer Psychiatrist, conservative newspaper columnist, Fox News contributor
Michael Lewis, author of Liar’s Poker, The New New Thing, Moneyball, Blindside, The Big Short, started at Salomon Brothers as a liberally-educated Princeton, London School of Economics kid who got paid hundreds of thousands for nothing and thought that was so stupid he quit
Rush Limbaugh, Conservative radio talk show host, pioneer of the genre, savior of AM radio, leading conservative in the U.S., appreciated fully by his fans, but not by non-listeners who underestimate him because of his mixing clowning and satire in with well-researched reporting and analysis
Joe Paterno, head football coach Penn State University; most Division I victories, bowl games, and undefeated seasons of any coach in football history; longest single-college tenure of any football coach in history; turned down numerous offers to “move up,” probably the biggest bargain of all coaches receiving just $500,000 a year in salary as a coach
Jane Bryant Quinn, fearless personal finance author and formerly at CBS TV news and Newsweek, now Bloomberg News personal finance columnist (in the interest of full disclosure, Jane is also my friend)
James (“Amazing Randi”) Randi, magician, escape artist and debunker of fakes, winner of a MacArthur Foundation “genius” award
Congressman Paul Ryan (R-WI), His Roadmap for America’s Future is the only legitimate proposal for fixing America’s runaway fiscal train, chairman of the House Budget Committee; America’s best chance to avoid federal government “bankruptcy” or hyperinflation
Thomas Sowell, economist, columnist, author, Hoover Institute Senior Fellow, has no filter
John Stossel, fearless Libertarian investigative reporter on ABC 20/20, switched to Fox News 9/10/09, goes out of his way to do provocative stories like one with the theme “greed really is good”
Walter E. Williams, relentlessly logical, powerful advocate of liberty and free-market economics. Economics professor at George Mason University, syndicated columnist, libertarian; takes great delight in using logic to prove all sorts of politically-incorrect conclusions, occasionally guest hosts for Rush Limbaugh having Limbaugh’s announcer introduce him as “black by popular demand”

I’m sure I will think of more later. I urge readers to suggest people to me. One reader suggested Milt Rosenberg a WGN Chicago radio talk show host. He may be deserving, but I know nothing about him so I cannot put him on my list.

Why Charlie Rose is not on the list

Another suggested Charlie Rose. I generally like his show, but my impression is that he is too afraid to displease guests for fear of getting a reputation that would discourage that guest or others from accepting his invitation to appear on his show. If I did such a show, I would not have liars on and if one slipped through, I would either call him on the spot or after investigating his false statement. That would cause the liars in question to refuse to ever appear again on my show and would cause other liars to refuse to come on to begin with.

Who are the liars? Elected or appointed officials, mass market corporate executives, corporations that rely on government contracts, political activists, etc. Who tells the truth as they see it? Generally, authors, tenured professors, retired people, true experts.

The John D. and Catherine T. MacArthur Foundation awards grants to fellows every year. They are commonly called the “genius awards.”

They say of the fellowships:

The MacArthur Fellows Program awards unrestricted fellowships to talented individuals who have shown extraordinary originality and dedication in their creative pursuits and a marked capacity for self-direction. There are three criteria for selection of Fellows: exceptional creativity, promise for important future advances based on a track record of significant accomplishment, and potential for the fellowship to facilitate subsequent creative work.

I wish there were a similar award for the combination of accomplishment and moral focus exhibited by the sort of people I have named above—and that it were not restricted to obscure persons as the MacArthur grants seem to be. It is easier to be moral when you are obscure than when you are involved in large organizations or mass markets.

I have no money to give to the folks I named above. Most of them probably already have more money than I do. But I tip my hat to them.

Charlie Rose review of Obama presidency

The Thanksgiving Charlie Rose Show featured a panel of people who were generally Obama supporters. Hearing they were going to review his presidency thus far I rolled my eyes and began wondering what else was on. But I let it continue to run just in case it was not going to be 30 minutes of “Obama can do no wrong.” The panelists were:

• Hendrik Hertzberg New Yorker Magazine author of the book ¡OBÁMANOS! (which roughly means “let’s Obama” in Spanish)

• Les Gelb Council on Foreign Relations author of Power Rules How common Sense can rescue American Foreign Policy

• Arianna Huffington

• John Harris of Politico

• David Bromwich Yale English Professor

When Hertzberg spoke, it was almost all Obama can do no wrong. He should have been replaced by a tent card with that message on it.

Gelb said

Very disappointed

Amateurish display

Haven’t gotten their act together yet

Trip to Asia that he probably should not have taken because it did not accomplish anything

Something is awry and he’s gotta fix it

Obama’s instinct is to get out of Afghanistan

not much good management

troops on the ground don’t know what’s going on

comments on Afghanistan before fall, 2009 were emphatic, then he just says April Fool and suggests what he previously said may be the opposite of what he now believes

enough errors that Obama should be asking himself what’s wrong and start to make fixes


Described himself as an “Obamaphile.” The suffix “phile” means lover. You can ignore everything else he said except one great line.

Obama will give troops for the military and rhetoric for the skeptics.

excuses all lack of results as “laying the groundwork”


very concerned about his decision to escalate in Afghanistan

puts into question his whole leadership

exactly what he said during the campaign he would not be doing

incredible indictment of the president

splitting the difference

trying to please everybody

promised unemployment would not go above 8.5% if stimulus passed

Obama focused an Wall Street instead of Main Street

almost universal sense that there has to be a course correction

no sense of adequate urgency on the economy

the fix is in


will respond rhetorically to his critics of foreign policy but words do not match actions

doubling down on troop commitment to Afghanistan

equivocating rhetoric

Obama administration, like Clinton’s, wears its underwear on the outside

Obama spends a lot of time living in his head

approaches foreign and domestic policy as a kind of Rubik’s Cube

20-point swing among independents against Obama in recent months


let best chance to get out of Afghanistan (leaking of Afghan ambassador recommendation to get out) pass by

not going to give up a credible account of who were fighting but why

I had higher hopes than have been fulfilled

overrates the power of words just as words to move people the way he would like them to move

fails to comprehend the effect of gestures like taking months to come to about the same decision everyone expected at the outset on Afghanistan

He does not have the right manner of weighing words versus gestures

would like to please everybody and to offend no one

lacks economy of words

acts conventionally but signals I’d really like to be doing this other thing trying to please all sides


pure Obama: using language that I am aware of all the objections but I’m saying what I’m saying anyway


To be sure, many of these comments relate to the fact that Obama has not been as big of a Commie and conscientious objector as many of his supporters expected. They are unhappy that the deficit is too small, that any troops are in Afghanistan or Iraq.

But I still think it’s noteworthy that he cannot even please his staunchest supporters.

Not up to the task

Many of these comments are generic criticism. That is they are about leadership, not partisanship. In general, they are saying

• Obama has his head in the clouds
• he has a tin ear about a lot of stuff like taking forever to decide on Afghanistan while troops are dying there
• amateurish rookie
• too slow to recognize when Plan A is not working and moving to Plan B
• brazen about lying and changing positions 180 degrees
• trying to please everybody while in a job where that is by definition impossible
• insufficient sense of urgency and ability to pick the correct priorities
• too academic and ivory tower
• too much talk and reliance on talk alone (campaign mode)
• blind to unfavorable appearances
• overconfident (e.g. Olympics, Cambridge beer summit)
• verbose
• thinks merely acknowledging the other side’s views placates them

Just another politician

To a large extent, the unhappiness stems from the fact that Obama is just another lying politicians who tries to be all things to all people. Reagan gave the right actions like tax cuts, deregulation, and military build-up. But when it came to social conservatism like abortion, prayer in schools, and the like, he only gave them rhetoric, no action.

Obama suffers more than most typical politicians from being a typical politician because he swore on a stack of Bibles that he was going to change all that and not be like that. No more earmarks, no more irresponsible spending, no more lobbyists, no more lack of transparency—all broken promises without the slightest acknowledgment or apology or explanation.

I appreciate informed, well-thought-out constructive criticism and suggestions. If there are any errors or omissions in my facts or logic, please tell me about them. If you are correct, I will fix the item in question. If you wish, I will give you credit. Where appropriate, I will apologize for the error. To date, I have been surprised at how few such corrections I have had to make.

What the ObamaCare and Cap & Trade laws are really about

Why don’t they understand that socialism does not work?

Ever since I became old enough to figure out that socialism doesn’t work—at around age 22—I was perplexed that liberals still want it. Why don’t they see capitalism is better and that economic freedom is necessary for all the other freedoms?

People who work for the government do not have freedom of speech. They are afraid they won’t get promoted or may lose their pension and other benefits. Similarly, a nation that gets all its health care from the government is a nation that is afraid to criticize the government out of fear that they or their relatives or friends may be retaliated against by the rationers.

Joseph Schumpeter

Joseph Schumpeter was a Harvard economist. He invented the phrase “creative destruction” to describe the effect of entrepreneurs. He also said entrepreneurs and their innovations were the engines of prosperity Liberal Harvard economist John Kenneth Galbraith said Schumpeter was the most sophisticated conservative of the twentieth century. Schumpeter was the subject of the 2007 book Prophet of Innovation by Thomas K. McCraw.

Schumpeter was the polar opposite of John Maynard Keynes. Both were born in 1883. As a young professor in Europe, Schumpeter was perplexed by intelligent leftists not recognizing that capitalism was infinitely superior to socialism as a way to organize a society and an economy. Indeed, one of my Harvard Business School section mates, Michael Rothschild, wrote the book Bionomics which says capitalism is analogous to the way the plant and animal kingdoms are organized and operate. In other words, capitalism is the all-natural, organic way of organizing living things.

Schumpeter finally figured it out. As have I reading about him and seeing other evidence of it.

Social justice

The left does not care which system produces the most prosperity or freedom. They want power. Dictatorial power. They are not in favor of anything. They hate capitalism because it lets the “wrong” people win. People like Sam Walton, founder of nonunion Wal-Mart. He was the richest man in the world for a while. His company is still the biggest in the U.S.

The left does not want maximum prosperity for all. They want all rich people who disagree with them to be stripped of their money. They understand that this will impoverish all but the government apparatchiks. That is what they want. They plan to be government apparatchiks. The left wants to wipe off the face of the earth anyone of whom their side is envious.

Journal editorial

The 11/10/09 Wall Street Journal has an editorial titled “Confessions of an ObamaCare backer.” It is about remarks recently made by leftist John Cassidy of the New Yorker magazine.

Cassidy, the Journal said, “let the mask slip” briefly and revealed the “real political motivation” behind ObamaCare. I add that the same motives are behind cap and trade and a great many other leftist initiatives. The green movement is nothing but the red movement in disguise.

Cassidy continues:

The Obama Administration…is creating a new entitlement program, which, once established, will be virtually impossible to rescind. [The reason is] making the United States a more equitable country

The Journal says the “…purpose is to further redistribute income by putting health care under government control, and in the process making the middle class more dependent on government. As the party of government, Democrats will benefit over the long run.”

The Journal says this explains why the Democrats are not afraid of angering the public by going against their will and even losing many purple district seats in the 2010 election. They figure if they can get this law enacted, they will be like drug dealers living off a nation of entitlement addicts within the next ten years and the few losses in 2010 will be irrelevant ancient history as the U.S. becomes a one-party nation.

The nation is going bankrupt because of Medicare, Medicaid, and Social Security, but there are no Americans who want to reform any of those three programs. Indeed, the mere suggestion of such reform is the “third rail of American politics.” Even the slightest criticism of any of those programs dooms the Republican who dared to suggest it. The Democrat program is to make their party platform in its entirety the third rail of American politics. And there is no indication whatsoever that they will not succeed after the push they got from George W. “TARP” Bush and the Wall Street plutocrats in 2008.

More Cassidy:

Putting on an amateur historian’s cap, I might even suggest that some subterfuge is historically necessary to get great reforms enacted.

Translation: Our noble end of turning America into a Democrat party dictatorship justifies our means, namely, lying about our motives.

Rush and Sean

The main guys who have figured this out and who are condemning it for what it really is are Rush Limbaugh and Sean Hannity. I have trouble finding fault with Limbaugh. Hannity, on the other hand, is not quite smart enough to hold the position he does, and he admits using tedious repetition of his propaganda phrases, like “unrepentant terrorist Bill Ayres,” to brainwash his listeners and viewers. He is also often incorrect, for example, with regard to his worship of Ronald Reagan. Reagan’s actual record is far more mixed than Hannity understands or admits.

You can measure the preeminent effectiveness of these two men by how hard Obama and his people are trying to stifle them through proposals to bad mouth them and to censor them through misleading proposals like the one to require local ownership of radio and television stations.

The problem with these two men being the main leaders in our nation against what the Democrats are trying to do is they are both ratings-seeking entertainers. They do, indeed, maximize their ratings by their mixture of humor and exaggeration, relative to other entertainers or headline news-type programs, but they simultaneously limit their audience in the wider population. Most importantly, their entertainment focus causes the majority of American to not take seriously the evidence they present and the logical conclusions they draw from that evidence.

I am a libertarian, not a conservative or a Republican.

The solution to all this is a third party. The libertarian ideas are generally the right ones. I do not endorse their actual platform in its entirety. It includes stuff like opposition to the draft and recreational drug regulation.

Are the Libertarians as a party poised to start winning elections? Not at all. They are talkers, not doers. They almost never elect a Congressman, let alone a president so they do not really have the organization or skills to win a majority. They have the ideas. I think most Americans today are actually libertarians but they either do not realize it or refuse to admit it. My mom was a Catholic, but I call her a social Catholic. I think she was actually an atheist based on knowing her for 47 years, but she would have vehemently denied that out of fear of it harming her relationships with her friends and relatives—who were probably also actually atheists. People who do not admit to being libertarians are afraid it might adversely affect their social status.

But ultimately, socialism does not work. Ultimately, the Democrats, with plenty of help from Republicans, will bankrupt the country. Best guess as to when? 10 to 20 years.

Harvard economist Kenneth Rogoff just came out with a new book This Time Is Different: Eight Centuries of Financial Folly. On Charlie Rose on 11/10/09, he was asked how long until the irresponsible U.S. government fiscal policy (taxing and spending) triggers a catastrophe. He said something like, “Probably five years. Sooner than 20.”

When that happens, the public will turn to a third party. Unfortunately, no third party is currently ready to turn that support into electoral victory in Congressional and presidential elections.

What bankruptcy of the U.S. might look like

Since the subprime crisis hit, I have been reading books about the Great Depression, the subprime crisis, Long Term Capital Management’s failure, the 2008 crash, Bear Stearns, J.P. Morgan, bailouts, stimulus, earmarks, and all that. I have also sought out local speeches about those things in San Francisco at the Commonwealth Club and TV expert discussions on Charlie Rose and similar shows.

Singapore leader Lee Kuan Yew was on Charlie Rose the last week in October, 2009. Very impressive, seemingly extremely knowledgeable guy.

Bond and forex traders

Based on everything I’ve read and heard and seen, I think Yew’s prediction is the correct one. He said or seemed to say that the bankruptcy of America will start with bond and forex (foreign exchange or foreign currencies) traders making a run on the dollar. Bond traders and forex traders are like the canary in the mine. They watch the U.S. fiscal and monetary policy with microscopes and telescopes 24/7. They will be the first to herald the arrival of the financial apocalypse.

What will bring us to the tipping point? Either an accumulation of straws on the camels back in the form of one media story after another, one new law after another, one new entitlement after another


some major shocking event, like a downgrade of U.S. credit by some international authority; hyperinflation, something like that.

When will it happen? I’m not sure. Maybe tomorrow. Maybe next year. Maybe five years from now.

Can we escape this fate? In theory, yes. But as a practical matter, no. There is not the slightest indication that the Congress or the president will behave prudently. Obama is worse than his predecessors, but his predecessors going back to Roosevelt the second were all disasters to one degree or another.


Normally, the phrase “run on the” ends with the word “bank.” Yew spoke of a run on the dollar.

In both cases, it means the public wants their money out of there. In a run on the bank, they lose faith in the bank and want to get their money out before the bank fails and they lose money.

That used to happen in the U.S. before the FDIC was created on 1/1/1934. Since then, deposits are covered up to $250,000 per account per bank with many rules about how many accounts one can be covered for.

A run on the dollar

A run on the dollar would be caused by people in the U.S. and other countries losing faith in the U.S. government’s willingness to get their national debt and unfunded liabilities under control.

If the debt and unfunded liabilities continue to explode, informed people expect that the Federal Reserve will be forced to print huge amounts of money. That causes inflation and hyperinflation.

Yew said if the U.S. government does not convince the world bond and forex markets that the U.S. government debt and unfunded liabilities intends to control it’s fiscal policy, there will be a run on the dollar. He seemed to shudder or wince at the thought of a run on the dollar and said it would be very bad or words to that effect.

What that would mean

A run on the dollar would mean that all the people of the world including U.S. citizens would decide the dollar was going to inflate big time. That means the purchasing power of the dollar would fall significantly, maybe to zero, as it has in the past in

Angola 1991-1995
Argentina 1975-1991
Austria 1921-1922
Belarus 1994-2002
Bolivia 1984-1986
Bosnia-Herzegovina 1993
Brazil 1986-1994
Bulgaria 1996
Chile 1971-1973
China 1948-1949
Danzig 1923
Georgia 1994
Germany 1920-1923
Greece 1944
Hungary 1945-1946
Israel 1971-1986
Japan 1943-1951
Krajina 1993
Madagascar 2004-2005
Mozambique 1977-1992
Nicaragua 1987-1990
Peru 1988-1990
Philippines 1942-1945
Poland 1989-1991
Romania 2000-2004
Russia 1921-1922
Turkey 1990-2005
Ukraine 1993-1995
United States 1861-1865
Yugoslavia 1989-1994
Zaire 1989-1996

This is research I did for my book How to Protect Your Life Savings from Hyperinflation and Depression

As you can see, there were three bouts of inflation in the U.S.: during the Civil War (both sides); just before, during and after World War I; and in the 1970s after the Vietnam War. There was also severe inflation technically before the U.S. existed during our Revolutionary War (“not worth a Continental”). There was also on-again-off-again inflation (and federal price controls) during and after World War II.

So don’t say it can’t happen here. It already has and it can again.

When hyperinflation occurs, as with the Revolutionary War “Continental” and Confederate dollars and the German mark in the early 1920s, the currency in question simply ceases to exist. That is, it becomes worthless. Obviously, no one wants to still be holding that currency when that happens. They want to get out before it goes that far. Hyperinflation is a form of Ponzi Scheme. If a Ponzi Scheme “victim” manages to withdraws their money before it collapses, they typically make a lot of money. But if they are still there when the music stops, they lose everything.

That’s how hyperinflation works.

If and when the people of the world conclude there is a danger that the U.S. will inflate the dollar significantly, they will get rid of dollars.

Currency and bonds

You get rid of dollars by trading them for other currencies or goods and/or services. Dollars take the form of actual currency, bank accounts, certificates of deposits, U.S. bonds, and contracts payable in dollars.

You’ve heard of the deficit—deficit spending. But do you know what it means? It means the government is spending more than it takes in in tax revenues. So where do the get the extra money?

They sell U.S. bonds. Who buys them? U.S. citizens and organizations and foreign governments and organizations and individuals.

A run on the dollar would mean among other things that:

A. No one bids at the next U.S. bond auction
B. Owners of U.S. bonds sell the ones they already own so they can put the money in something other than dollar-denominated bonds or accounts

As a practical matter, what would actually happen is that the U.S. Federal Reserve bank would buy all the bonds offered at the auction. This is what goes by the phrase “printing money.” When the Federal Reserve buys U.S. bonds, they are doing one of the things that is technically the equivalent of printing money. The Federal Reserve buying the bonds puts that much into the bank accounts of the federal government. That increases the money supply by that much. That causes inflation.

Indeed, there is a vicious spiral. Fear of dollar inflation causes people to refuse to buy U.S. bonds that they fear will lose purchasing power because of inflation. The government reacts by printing even more money which causes inflation to get even worse which cause more people to try to sell the U.S. bonds they already own which causes the Federal Reserve to buy those bonds because no one else will and so on.

To keep on deficit spending, the U.S. would either have to “print” money (Federal Reserve buying U.S. bonds) or the U.S. would have to pay higher interest rates on the new bonds to attract enough bond buyers. That would be awful because it would mean they would have to raise taxes or cut benefits even more to pay the new higher interest rates on U.S. bonds. Also, higher interest rates on U.S. bonds, would mean even higher interest rates on all other types of bonds or loans including mortgages, car loans, education loans, business loans, and so on. That, in turn, would drive down the values of all capital assets like cars, houses, factories, nd so on.

U.S. imports

We got lots of stuff cheap. Probably most of the clothes you are now wearing were made outside the U.S. Ditto your TV, car, and so on.

What happens if people in other countries no longer trust the dollar? They will tell you to pay for your flat screen TV or underwear or imported car in yen or euros or yuan or whatever currency they trust. So you have to exchange your dollars for other currencies to get the money to buy your imports. But the forex dealers aren’t much more interested in your dollars than anyone else. So you will have to pay a lot more dollars than in the past to buy, say, yen.

My youngest son and I went to London, Paris, and Rome in May, 2008. The dollar amount for purchases that were cheap in the U.S. were brutal. What Yew fears would be a lot worse.

U.S. exports

In theory, U.S. exports would be greatly helped by the value of the dollar falling in relation to other currencies. It would make our stuff cheaper overseas. But as a practical matter, those countries are used to exporting to the U.S. not importing from it. Losing those exports would lose many jobs and cause very unhappy people in those countries. Their politicians might react the way they often do when we pass tariffs that hurt their exports to us. That is, they might slap retaliatory tariffs on our exports to them to placate their unemployed workers and force their citizens to buy from manufacturers within their own countries.

Inflation not enough

The U.S. government has five choices for fixing the excess debt:

• monetize the debt (use inflation to make it easier to collect more taxes and easier to make payments on debt not indexed to inflation)
• cut spending, mainly social security, Medicare, and Medicaid
• raise taxes (not really much of a possibility because the amounts needed are about three times current total tax revenues)
• economic growth that increases tax revenues
• default on the debt

Economic growth, is of course, the most pleasant choice, although the rate of growth needed would have to be almost unprecedented and for an unprecedented period. But the bigger problem is Democrats are now in charge and they hate all pro-growth measures, namely:

• reduction of top tax rates
• elimination of dubious environmental restrictions
• free trade (elimination of tariffs like the “Buy American” part of the Stimulus or the tariffs on Chinese Tires)
• increase in the percentage of the economy that is controlled by entrepreneurs
• strongest possible rewards for innovation
• drill for oil and dig for other minerals in U.S.
• end detrimental restrictions on business like zoning, rent control, permits
• tort reform

and so on. See my longer article on a miracle growth program that would cost the American taxpayers almost nothing.

Default is arguably the best alternative

Crazy as it sounds, default may be the best choice. It eliminates the need to raise taxes. It does not monetize all debts. So private debts would still be payable and the lenders not cheated by inflation. Default would hurt all owners of U.S. bonds, but generally, they can afford it better than the wider group that would be hurt by inflation. Many people own U.S. bonds without knowing it via pensions and mutual funds.

What would be the consequences of default?

Probably all the other countries would promptly do the same. Why be a chump? Why not retaliate against the country(ies) that did that to them?

What about future deficit spending? There would not be any.

Why not? Because governments have to sell bonds to engage in deficit spending and no one would buy government bonds after a default.

Essentially, the previously no-limit credit cards of the President and Congress would be terminated and cut up into little pieces. They would have to pay all cash—that is, tax revenues—for all government spending.

Our children and grandchildren would not be stuck with an impossible debt. Neither would they live in a country with good credit.

Government spending, mainly Medicare, Medicaid, and Social Security would have to be cut drastically—probably means tested, that is, affluent and middle class people get no money from the government. What about the fact that you paid into it?


They would also have to cut things like government employees, government employee pensions, government employee health care benefits, earmarks, boondoggles, government buildings, etc..

The budget would look like it did in, say, 1927—percentage and deficit-wise, not counting the effects of 82 years of inflation since then. We had a budget surplus that year. Our government spending was a bit less than total tax revenues.

Would the government not being able to deficit spend be the end of the world? Actually, that’s more or less the way all 50 states have always had to operate. They could issue bonds, but not too many. They recently did issue too many such bonds in CA and other states. The bond rating agencies downgraded them and that was, roughly speaking, the end of their deficit spending.

Let me repeat one part of this. If we defaulted on the national debt, our Congress and President would be henceforth prohibited from spending more than they collect in tax revenues.

As Martha Stewart likes to say,

That would be a good thing.

Actually, compared to what’s been going on since 1930 (Hoover Administration), it would be a fantastic, unbelievable improvement.

Most of all, it would keep the barefaced-lie promise that we are not going to “kick the can down the road” or “put a bunch of debt on the backs of our children and grandchildren.” In fact, “kicking the can down the road” and mortgaging the futures of our children and grandchildren is exactly what we have been doing since 1930. The authors of The Coming Generational Storm rightly call it fiscal child abuse.

Defaulting is not the right thing to do. The right thing to do is to broaden the tax base, adopt pro-growth policies, and drastically cut entitlements. However, there is absolutely no hope that Congress or the president will do the right thing. Nowadays, Represenative democracy attracts to Congress and the White House a collection of sociopaths. Normal people like you and I would never run for Congress or president in a million years. The people who will in the 21st century are psychiatrically defective. We need to default to stop those sickos from making things even worse.

Defaulting would force the voters and politicians responsible for that misbehavior, us and our parents who are still alive, to pay for it right now.

Rough justice.

Disaster only way to get ‘change we can believe in’

On page 246 of their 2005 book The Coming Generatonal Storm, authors Kotlikoff and Burns put it this way:

Truth be told, our politicians care more about their next fix—the next election—than they do about the next generation. And they’re not going to clean up their act unless and until they are confronted with a major crisis. Hence, as crazy as it sounds, our only real hope is that the economy will go critical sooner rather than later.

I would add, if that’s where we’re going, and there seems no doubt of that, let’s get it over with—save the nine stitches.

The best way to push the economy off the cliff ASAP is probably Obama’s current quartet of health care, cap and trade, protectionism, and increasing taxes on “the rich.” They are likely to be the anvil on the camel’s back.

Is Barack Obama really a great speaker?

Even Obama’s critics acknowledge he is an excellent reader of teleprompters.

Johnny One-Note

We need to revisit that. The most experienced readers of teleprompters are the talking heads, including reporters and correspondents, on TV. Is Obama better than they are?


Why not? They have a range of emotions, humor, different approaches for different types of stories. They have to. If they were some sort of monotone, Johnny One-Note, one-emotion type of teleprompter reader, they would lose their jobs.

Barack is that monotone kind of teleprompter reader.

In her 9/5/09 Wall Street Journal column, Peggy Noonan called Obama “Faux Eloquent Boring.” She said he “always has the same sound, approach, logic, tone, modulation…stance, [lack of] humor and [lack of] humility.” Speaking of his appearance at Ted Kennedy’s funeral, Noonan said Obama was,

…dignified and contained, he was utterly appropriate, and he was cold.

He is cold, like someone who is contained not because he is disciplined and successfully restrains his emotions, but because there is not that much to restrain. This is the dark side of cool.

Well put. He always talks as if he just got back from talking to God on Mount Sinai and we need to listen up to the next installment of the Ten Commandments.

Always scolding

He’s always scolding us or people in other countries. To mute domestic criticism of his foreign apology tours, he has one scold against the foreign country in question for every apology about what a rotten nation the U.S. was before Barack was president. Barack never apologizes for anything Barack ever did. The apologies are always for what we not-up-to-snuff citizens did, or allowed, before we came to our senses and put Barack in charge.

Pissed off

Barack is also always pissed off when he lectures us. Been hanging around Michelle too much. Whatever happened to her anyway?

For those who were adults in the late seventies, he reminds us of Jimmy Carter, a disaster of a president who was always admonishing us for not being good enough. He ran for president after eight years of unpopular Republican administrations and campaigned as an anti-Washington outsider. But once he got into the oval office, the most famous word used to describe Jimmy Carter’s presidential oratory was “malaise.” In the summer of 1979, he told us a sort of malaise had descended on our country. He said the “energy crisis” was the “moral equivalent of war,” then promptly lost that “war” if that’s what it was. He told us, “We must face the fact that the energy shortage is permanent.” That was dead wrong.

Carter was replaced by sunny, optimistic, free-market Reagan who on inauguration day, ended Carter’s “energy crisis” with a stroke of a pen when he signed an executive order ending price controls on fossil fuels. Carter denounced the end of price controls as “immoral and obscene.” By the end of the Reagan administration in 1988, the price of oil had fallen to half what it was in Carter’s last year in office, 1980. There was an oil glut and that is even what the media called it at the time.

Carter promised fiscal responsibility, but the deficit set new records when he was president. He had no ideology or other guiding principles and consequently vacillated and launched multiple, contradictory economic programs, each designed to placate the complaint of the moment.

Carter presided over the worst inflation since World War I, but blamed it on a moral affliction affecting American society. He said we had “lost our capacity to sacrifice for the common good” and that it was a “myth that government can stop inflation.” I wrote a book called How to Protect Your Life Savings from Hyperinflation and Depression. Inflation is, by definition, caused only by government, which has a constitutional monopoly on setting the value of money, and inflation can therefore only be stopped by government. Carter’s successor, Reagan, made ending inflation a top priority and did end it.

Carter was a doomsday prophet who believed the world was headed for disaster. His Global 2000 Report, written in the last year of his administration in 1980 said,

By the year 2000 the world will be more crowded, more polluted, and less stable ecologically and the world’s people will be poorer in many ways than today.

Sound familiar? Those are not the same words Obama uses, but the basic message is the same. He sees crisis as a way to get political support for his agenda, so he constantly tells us we are in a crisis. A leader is mainly supposed to build confidence in him and in ourselves.

Post-Brown-Victory in Massachusetts speech

On 1/22/10, Obama made his angriest speech yet, doubling down once again on determination, putting a sharper edge on his voice, yelling even louder that, “We’re gonna get this done!” As if he has the power to force us to accept every single one of his programs or else.

As in Copenhagen, where he was supposed to be talking about why the IOC should award the Olympics to Chicago, it was all about him. His Copenhagen sales pitch was all about him. And his 1/22/10 speech after the Brown victory in MA was also all about him. I, I, I, I. From his perspective, everything is all about him, including health care, cap & trade, financial regulation, you name it. To the rest of America, it’s about jobs, health of the citizens, and so on. To Obama, everything is about him, everything is personal. To him, resistance to “his” health care program, which really has never existed in a final version, is a personal attack on him and his opponents have no other motivation but to hurt him.

Attacking straw men

The only other word he used again and again—14 times—was “fight.” Fight whom? He shouted that he will not stop fighting for jobs. Against whom? Who is trying to prevent jobs? No one.

This is another of Obama’s cheap rhetorical tricks: trashing nonexistent straw men whom he implies are advocating some awful policy—like preventing job creation. No one is doing that in any of his straw man speeches, but listeners who are not too bright come away inspired by his heroic efforts against those imaginary straw men.

This man is truly dangerous.

Someone once asked President Reagan, a former successful Hollywood actor, how an actor could do the job of being president. He laughed and said he could not understand how anyone could do the job if they were NOT an actor.

He had a point. The presidency is a TV show to 99% of our citizens. The president is to star in that show and lead the nation through his performance as much as through his policy decisions and policy implementation.

No actor

Barack Obama is no actor. He is more akin to one-dimensional, famous popular culture figures like:

• the guy who used to talk real fast on Federal Express commercials
• former CBS newscaster Dan Rather who has a permanent pompous, somber way of talking

The presidency requires more range than guys like that.

Three cheap tricks

I had a bunch of training as a public speaker at West Point and in the famous Dale Carnegie course on public speaking. We had to do a lot of public speaking at Harvard Business School (in our amphitheater style classrooms) and when I was an Army officer commanding from 30 to 400 men—5,000 once in an Armed Forces Day parade where I was the adjutant. The adjutant runs the whole parade until near the end. You can see video of me making several unpaid, informal speeches at YouTube. In the late 1970s and early 1980s, I was a member of the National Speakers Association and the International Platform Association and made my living in part as a professional speaker.

As an erstwhile professional speaker, who has often been at conventions where I was one of many speakers and I listened to them as well, I know many of the tricks of the speaking trade. Obama’s reputation as a great speaker actually stems mainly from his use of several cheap speaker tricks.

Random pauses

He frequently pauses randomly and for no reason other than mesmerizing the audience. This has the effect of drawing the audience up onto the front edge of their chairs as they instinctively strain to hear what the person is saying. Obama’s fellow Chicagoan, the late Paul Harvey, was the master of the theatrical pause. In Paul Harvey’s hands, the pause was the tool of a mastercraftsman, strategically placed when used, not random, not a cheap trick. I would not be surprised if Obama did not get his pause trick from Harvey.

I heard a female professor on Charlie Rose in the summer of 2009 use a similar trick for the same reason. She deliberately lowered her voice more and more as the program went on until Charlie and the TV audience were straining on the edge of their seats to hear what she was saying. Apparently she had discovered and perfected this trick in college lectures as a professor.

Rose let her get away with it. If I had been him, I would have whispered to her, “If you do not stop whispering your answers to my questions, I will cut off the sound and replace your voice with subtitles when we broadcast the show. Capeche?

Command-of-execution head nod

In the military, the way you give a command is to loudly enunciate what is called a preparatory command. Then you let the command of execution explode sharply out of your mouth typically with body language that includes decisively nodding your head forcefully for visual emphasis. You also raise your voice on the last syllable.

For example, to get a group of soldiers to start marching the preparatory command is “Forward,” which is enunciated and somewhat drawn out—“Fooor WARD.” Then, after an Obama-like pause to let everyone get mentally prepared, you give the command of execution, in this case: “March!” The word “march” explodes out of your mouth like a the gunshot out of a starter‘s pistol signaling the start of a 100-meter dash.

In football, quarterbacks often use a head bob and pauses to try to draw the defense into jumping offside. The head bob in that context is actually illegal and draws a penalty flag. There are no referees in Obama speeches.

In addition to his pauses, Obama likes to end almost all paragraphs or sentences with a quick “And that’s FINAL!” nod of his head and a raised-voice-for-emphasis last syllable. That is the military officer or NCO’s command-of-execution trick. A typical Obama cadence might go like this:

Well, as I’ve




SAID (that’s FINAL nod)


Iraq is


the wrong WAR (that’s FINAL nod)




the wrong PLACE (that’s FINAL nod)


and the wrong


TIME. (that’s FINAL nod)

You can easily strip Obama’s speeches of their magic by simply counting the unnecessary pauses and nod-accompanied commands of executions. A college classmate and I once amused ourselves at a Chamber of Commerce dinner by counting the number of times the various speakers said the phrase “and his lovely wife.” My wife said one of her colleagues used to count the number of times their boss used the word “grapple” in his talks.

O’Reilly has a body language specialist on a lot of his shows. Hannity runs a “liberal translation” over various leftist politician statements. Either of them could run an Obama “great speech” with a pause counter in the lower left corner and a nodding command of execution counter in the lower right corner and thereby reveal what Obama’s great rhetorical ability really is. You could also run one of his speeches with the sound turned off and see the pauses and head bobs more easily.

Limbaugh’s speeding-up trick

Rush Limbaugh, the greatest radio entertainer of all time (hard to argue with an $800 million contract), is no slouch on understanding the use of a voice. He apparently sensed the same thing I did with Obama, that his voice tricks the audience into thinking he’s saying great things when he’s not. But Limbaugh’s way of nullifying the effect of Obama’s voice was to speed up the tape so Obama sounds like one of the Chipmunks.

I agree with Limbaugh that Obama’s voice tricks need to be nullified, but I think the Chipmunks technique is unfair and makes Obama sound childlike and silly in ways that he is not. Better Limbaugh should electronically remove the pauses and the “that’s FINAL” voice raising to reveal the emptiness of Obama’s rhetoric—and tell the audience he has done that.

Some might argue that changing Obama’s speeches into a total monotone is not fair. Well, he talks in a monotone almost all the time for starters. And I would allow him some voice inflection, but not the excessive, metronomical way he uses voice inflection. (go to and click the “on” button)

Wrapping oneself in the flag

A cheap speakers’ trick that disgusted me at the National Speakers Association convention in New Orleans in the early 1980s was wrapping oneself in the American flag figuratively speaking to draw approval for one’s speech. One speaker there ended all speeches by asking the audience to stand up and sing God Bless America which had nothing to do with his speech, although he did go to the effort of segueing into it. Since the audience was already on its feet and feeling uplifted by the song, “he” got a standing ovation. Creepy.

Obama’s verbal version of that is his almost invariable use of the entire phrase “United States of America,” in a rising, final-words-of-a-hymn lilt, rather than the more common “America” or “U.S.” or “this country.” It triggers patriotic impulses which are then used to make it seem like the audience loved Obama when it was mainly the reference to their country that they were responding to.

The wit of Obama

A number of other great orators have had books published that just include collections of their humorous statements including Lincoln, Churchill, Kennedy, and Reagan.

Don’t hold your breath waiting for the book The Wit of Obama. The closest he comes to humor is lame jokes like his saying after his first ride on Air Force One: “Pretty nice. ” He got a big laugh, but not because it was funny but rather it came out of the mouth of THE PRESIDENT. Some judge got national press coverage for using the phrase “This Bud’s for you” in a court opinion where beer was the subject of the case. It wasn’t that funny. What made it so notable was just that a judge made a joke in a court opinion.

Memorable statements

JFK, FDR, Lincoln, and Reagan are highly regarded as great orators. They said many memorable things. Even with the best available speech writers and now five years as a U.S. Senator and President, Obama has said nothing memorable.

Here are some memorable quotes from JFK, FDR, Lincoln, and Reagan:


Let us never negotiate out of fear but let us never fear to negotiate.

And so, my fellow Americans, ask not what your country can do for you; ask what you can do for your country.

All free men, wherever they may live, are citizens of Berlin. And therefore, as a free man, I take pride in the words "Ich bin ein Berliner!"

I am the man who accompanied Jacqueline Kennedy to Paris, and I have enjoyed it.

I think this is the most extraordinary collection of talent, of human knowledge, that has ever been gathered at the White House – with the possible exception of when Thomas Jefferson dined alone.

If a free society cannot help the many who are poor, it cannot save the few who are rich.


Let me assert my firm belief that the only thing we have to fear is fear itself.

In the future days, which we seek to make secure, we look forward to a world founded upon four essential human freedoms. The first is freedom of speech and expression—everywhere in the world. The second is freedom of every person to worship God in his own way—everywhere in the world. The third is freedom from want–which, translated into world terms, means economic understandings which will secure to every nation a healthy peacetime life for its inhabitants–everywhere in the world. The fourth is freedom from fear—which, translated into world terms, means a world-wide reduction of armaments to such a point and in such a thorough fashion that no nation will be in a position to commit an act of physical aggression against any neighbor—anywhere in the world.

Yesterday, Dec. 7, 1941—a date which will live in infamy—the United States of America was suddenly and deliberately attacked by naval and air forces of the Empire of Japan.

We, and all others who believe in freedom as deeply as we do, would rather die on our feet than live on our knees.

The test of our progress is not whether we add to the abundance of those who have much. It is whether we provide enough to those who have little.


Those who deny freedom to others, deserve it not for themselves; and, under a just God, can not long retain it.

Let us have faith that right makes might, and in that faith, let us, to the end, dare to do our duty as we understand it.

A house divided against itself cannot stand.

With malice toward none, with charity for all, with firmness in the right as God gives us to see the right, let us strive on to finish the work we are in; to bind up the nation’s wounds; to care for him who shall have borne the battle, and for his widow and his orphan – to do all which may achieve and cherish a just and lasting peace, among ourselves, and with all nations.

Fourscore and seven years ago our fathers brought forth on this continent a new nation, conceived in liberty and dedicated to the proposition that all men are created equal.

..that we here highly resolve that these dead shall not have died in vain; that this nation, under God, shall have a new birth of freedom; and that this government of the people, by the people, for the people, shall not perish from the earth.

The mystic chords of memory, stretching from every battlefield and patriot grave to every living heart and hearthstone all over this broad land, will yet swell the chorus of the Union, when again touched, as surely they will be, by the better angels of our nature.

Ronald Reagan:

Mr. Gorbachev, tear down this wall!

a shining city on a hill

You and I have a rendezvous with destiny. We will preserve for our children this, the last best hope of man on earth, or we will sentence them to take the first step into a thousand years of darkness. If we fail, at least let our children and our children’s children say of us we justified our brief moment here. We did all that could be done.

I hope you’re all Republicans. (said to the surgeons around the operating table immediately after his being shot by a would-be assassin)

I want you to know that also I will not make age an issue of this campaign. I am not going to exploit, for political purposes, my opponent’s youth and inexperience. (Said in TV debate with Walter Mondale during the 1984 campaign)

We will never forget them, nor the last time we saw them — this morning, as they prepared for their journey, and waved good-bye, and "slipped the surly bonds of earth" to "touch the face of God." (comments after the Challenger disaster)

Barack Obama:





One of the rules of show business is to always leave the audience wanting more. Celebrities, including politicians, are also usually concerned about getting overexposed. Many top celebrities like Frank Sinatra and Bruce Springsteen rarely made or make public appearances.

Not Obama. He and his staff seem to have decided that he is a one-trick pony—that is, a great teleprompter reader. But that he is such a great teleprompter reader, that he, unlike mere mortals, cannot be overexposed no matter how much the public sees of him. In that same vein, they seem to have concluded that the solution to any problem the White House has is to simply have Barack read yet another speech on TV. The guy has made a zillion speeches yet seems intent on continuing to make as many more as he can.

I think he is very near overexposed already and his 9/9/09 speech to a joint session of Congress about his health care plans seems doomed to failure because he has nothing new or persuasive to say. Apparently, the speech will be simply Obama style yet they expect it to somehow snatch victory on the health care legislation from the jaws of defeat. Doing the same failed thing over and over yet expecting a different result is one of the manifestations of insanity, not leadership.

Promising more than you deliver

In an early article about Obama I said he was doomed to failure because herepeatedly made the very stupid mistake of promising more than he can deliver. When you think about it, there is only one way to do a good job yet have people unhappy with the job you did. That is to promise more than you deliver. One Obama example: When urging the nation to approve his “stimulus” bill, he said unemployment would go above 8% if we did not immediately pass it. Congress passed it, notoriously without reading it, and unemployment promptly went above 8% anyway—a fact which is contrasted with his promise dozens of times daily now on TV.

By choosing a joint session of Congress, which is the sort of big deal used by President Roosevelt to declare war on Japan the day after Pearl Harbor, Obama promises a huge deal. I predict he will not deliver anything other than more of the same things he has been saying for months. If so, he has turned himself into the boy who cried “wolf!” That is an extremely shoot-yourself-in-the-foot thing for a president of the “United States of America” to do.

It’s WHAT you say, not how you say it

Ultimately, to be considered a truly great orator, which is almost a requirement of a great president, you need to say memorable things that inspire people to respond to the “better angels of our nature.” Obama has never done that, in spite of having many opportunities to do so. After his much-ballyhooed speech on race, his supporters in the press said it would henceforth be taught in schools alongside the Gettysburg Address and the Declaration of Independence. No. it won’t. Hardly anyone remembers a word of it even though it happened in 2008. The only phrase I remember is his calling for a “dialogue on race,” by which I said he meant blacks bitching and whites taking notes and promising to change everyhing blacks want changed to the way blacks want it.

Obama says nothing, but he says it with grand faux eloquence. A comment I made about Rich Dad Poor Dad author Robert Kiyosaki also applies to Obama:

In this, Kiyosaki also reminds me of Robert Blake, the movie and TV actor best known for starring in the late-70’s TV series Baretta. Blake’s TV-talk-show appearances were invariably interrupted by audience applause. Why? Like Kiyosaki, he was given to spouting platitudes so grandly and self-confidently that the audience assumed he must have had said something great. He didn’t.

I am not sure that the American people will ever figure out that Obama says little and achieves his hypnotic effect with cheap speaker tricks, but I think they could if someone would explain and point out to them the tricks being used and the fundamental clichéd, all-slogans-all-the-time emptiness of his speeches.

Here is an excellent email I got from David Cooperman adding similar observations he has made.

Mr. Reed:

I’m a big fan of your work, and enjoy reading the articles and books. I’m a real estate guy and stand-up comedian, so I followed the various cheap tricks with interest. The part about draping yourself in the flag definitely rang a few bells for me. When 9/11 occurred there was never ending sequences from comics "let’s hear it folks for those firefighters, and police – the real heroes"…There are all sorts of gratuitous things comics say so they’ll be liked – "you ladies are really so much smarter than us". I worked with a guy who would end his show with the song "Walking in Memphis". He had a good voice, but I sat there thinking "he’s singing the entire song straight?" No jokes thrown in, no parody, just a song? Bizarre. He wasn’t a strong enough comic to get standing O’s – but he’d always get applause. To me, I think he was just filling time to do his required minutes – and when you’re singing, you’re not getting laughs, but you’re not pausing either so the audience can’t really tell if other audience members are NOT enjoying themselves. So, it’s a bomb-avoidance technique. I know, I know, I’m digressing. But – politicians and comedians share the same disease – generally, they need to be liked (there are exceptions in the comedy arena, but generally the rule stands).

In terms of your critique, the thing I think you’re leaving out is that no, Obama isn’t a great orator – but he has a good voice. So, when people gush about his speaking abilities, I think they’re just mistaking good pipes for good oration. Kind of like the Richard Burton-syndrome – or James Earl Jones (in my opinion) – great voices, not great actors. I believe Burton actually fessed up to this. Compared to Bush though, Obama is Paul Harvey or Reagan…since all the Bush’s were just horrendous public speakers. McCain also wasn’t particularly gripping as a public speaker (in fact, I think he’s terrible, although I like him on the whole more than you do), and I think Palin was/is pretty rough on the ears. So, Obama doesn’t have to compare necessarily to the greats. It’s like winning an Oscar – the Best Picture doesn’t have to go up against Citizen Kane – it just has to beat the field that’s there. As a speaker, Obama beats the field. Plus, like a big name comic who has to perform new material – Obama has writers. I don’t think great speeches have been made (the ‘unclench your fist’ line was memorable, albeit wrong). So, I don’t give his writers the poor grades you do. He said some funny things at the White House press dinner.

He’ll be remembered – no matter what – because he’s a black guy. Leftist teachers will bludgeon that into the brains of every kid of future generations, no matter what. He may be the next Jimmy Carter but he’s the black Jimmy Carter, and that’s that. In a way, he’s the anti-Jackie Robinson, Joe Louis, etc. They had to be great to break through. Although in sports – it’s easier to be objective about greatness. Presidents are a little different. When presidents speak – you don’t get to see the stat lines on the bottom of the screen. There aren’t Bill James-types for politics.

Thanks for your time,

Dave Cooperman

Reed note: I would argue that my son Dan (his web site is and I are trying to be Bill James types for politics.

Obama’s 2/24/09 economic speech to Congress

After being told by many of his fellow Democrats to back off “the sky is falling” rhetoric, Obama inserted some football coach “we can do it” pep talk stuff into his speech.

Let me tell you about the “we” in that reference.

How ‘we’ got to be ‘we’

America is not the world’s greatest country because “we” are located between Mexico and Canada. It is not the world’s greatest country because there is something in the water here. Or that “we” Americans have some unique ingredient in our DNA.

“We” are the greatest country because of certain crucial ingredients in our constitution and social compact, namely, the rule of law, free enterprise, private property, and reliance of our citizens on themselves to make their lives better, not on our government.

But the Bush-Obama laws of the last five months have to a large extent made those crucial ingredients illegal!

Obama celebrates how great “we” are and what great things “we” have done while simultaneously outlawing the great things “we” did.

Financial capital of the world

For example, the U.S. has been the financial capital of the world for about a century. The “we” who did that were the bankers and Wall Street guys combined with the U.S. laws and regulations that gave those bankers and investment bankers the freedom and leeway to do what they did.

Democrats now point to the subprime crisis as evidence that the bankers and investment bankers are utter incompetents who know nothing and whose activities need to be outlawed. For example, they are now micromanaging compensation of highly paid employees, including those paid by commission based on their sales or profits, and they are outlawing off-site business meetings according to demagogic, scapegoat stereotypes. What is the effect of this? The head of Morgan-Stanley was interviewed by Charlie Rose. Rose asked about these restrictions on compensation. The Morgan-Stanley CEO said the companies not covered by the new federal regulations on compensation are being gleefully headhunted by U.S. companies not covered by the new regulations and by foreign companies like Deutschebank. These are traders and star executives that those companies have been trying to recruit to work for them for years, with only partial success. Now, they are thrilled that the president of the U.S. has limited compensation. It will lead to an enormous brain drain of Wall Street talent to unregulated U.S. and foreign companies.

So while Obama is bragging about and almost taking credit for the great financial power that “we” created, and promising that since “we” created that financial center of the world, “we” can create it again, he is driving the “we” who actually did it and who know how to do it, away. He is also creating a structure of federal control and other laws that prevent a new generation of “we” from recreating the world’s greatest financial system. This started not too many years ago, in the wake of Enron etc. with the Sarbanes-Oxley new regulations which overnight made the U.S. IPO market number 2 to London after years of U.S. domination. The next great thing in Silicon Valley will have to go to London or Hong Kong or somewhere for financing because New York is now under the thumb of the Democrat politicians.

Obama and his Democrat allies say “we” can recreate our role as the world financial center, but he is simultaneously making it illegal for “we” to do just that. Yes, “we” can, but only if the Democrats change the laws back to permit it to happen. If it is illegal, as with Sarbanes-Oxley and the latest restrictions and nationalizations, it will not happen regardless of the fact that “we” are, as always, capable of doing it.

What about the fact that the bankers and investment bankers caused this problem? It’s true. They screwed up. Anyone who points that out should be congratulated for his grasp of the obvious. The bankers and investment bankers would, without the slightest action by the government, correct the mistakes. Their motive is to make as much profit as possible next year. They cannot do that by making lousy loans or by losing people’s money. They would adopt new internal controls to prevent the same mistakes from happening again. They would strengthen their balance sheets so they can again attract investors. This would happen fastest if there was absolutely no government intervention. The market would force them to do it and they would be rewarded to the extent that they get it right, fast. Some regulations relating to private businesses spending or risking need to be improved, but as always, the government needs to be careful not to overreach. Obama is not being careful to overreach. His picture is now next to the definition of overreaching in the dictionary.

Instead, we now have politicians and bureaucrats making business decisions. There is not a snowball’s chance in hell that management by the politicians and bureaucrats will do anything to the banks and investment banks but destroy them. Politicians and bureaucrats are the folks who run the Bureau of Indian Affairs, Katrina, and so forth.

London was the financial capital of the world a hundred years ago. If the British government does not overreact, London will again become the financial center of the world. “We” will be unable to regain our prior status in spite of our bigger market because our government will have made financial market excellence illegal.

Cars, too

The same thing applies to the car industry. Obama says we invented it, therefore we must save it. Actually, the Germans invented the car. Henry Ford just applied the assembly line (which he did not invent) to the manufacture of cars and applied a business principle other car manufacturers did not think of or rejected. That is, he assumed that low prices would increase the number of cars sold and that increasing the number of cars sold would let him lower the price still further, and so on.

The fact that we had the first successful manufacturer and marketer of huge numbers of cars has nothing whatsoever to do with whether the federal government should endlessly pump taxpayers’ money into the Big Three. We actually did invent the TV, but it has been a long time since a U.S. company manufactured one. No one cares.

The problem with the Big Three is their overly generous-to-the-union contracts. The solution is to renegotiate them either outside of or inside of bankruptcy. Taxpayer money should have nothing to do with it. The foreign car companies who manufacture cars in the U.S. are not in so much trouble because their plants are in the South and non-union.

Bankrupting the country

Then there is the issue of Bush and Obama bankrupting the country. When “we” made the U.S. the greatest country in the world, we did not have the ridiculous debt levels—either in dollars or percentage of Gross Domestic Product or whatever metric you want to use. Whether “we” can become great again while carrying this mind boggling debt weight on “we’s” back is very questionable. “We” did it before. And “we” can do it again. But “we” never did it with an $11 trillion dollar debt before. That debt that is now 79% of our gross domestic product and climbing by hundreds of billions or trillions a week as Obama passes one new monster program after another. Our national debt has not been that high since World War II/Korean War. During the Great Depression, the national debt was only about 20% of the gross national product.

It is fairly easy to come up with multiple scenarios in which that debt prevents us from regaining the greatness that “we” created in the past.

Obama is fond of saying we have to spend, spend, spend because we are facing the worst financial crisis since the Great Depression. Actually, at present, the financial crisis is more like the 1981 recession than the Great Depression. One could make a more compelling argument that we have to cut, cut, cut spending because we have the biggest debt since the World War II/Korean War period.

Wall Street has crashed and crashed again and crashed again as Bush and Obama have stumbled ineptly from one “try this” to another. Obama’s spokesman says he pays no attention to the stock market.

Say what? I believe the stock market is where the vast majority of Americans invested their life savings, their retirement money. The only reason Obama pays no attention to the stock market is because it keeps panning his “solutions.” The fact is until Obama causes the stock market to stop falling, everything else he does is just throwing gasoline on a fire.

The locomotive of the American economy is its entrepreneurs. Obama pays lip service to them, but all his policies hurt them. Monstrous borrowing by the federal government crowds out the entrepreneurs seeking financing or drives up the interest rates they have to pay. Raising taxes on the top 2% reduce the incentives that motivate entrepreneurs. Crack downs on Wall Street make it hard or impossible to do the initial public offerings that are the keystone event in the history of companies like Microsoft, Google, and Apple. Democrats would unionize their factories and burden them with greater health care costs. In fact, Obama really thinks jobs come from government and he will kill the private sector by draining more and more tax revenue from them and by regulating them out of profitability.

Yes, “we” can, but only if the government does not outlaw it. Government is outlawing and discouraging and elbowing aside entrepreneurial activities. Top talent in the U.S. will brain drain to the Middle East or London or Hong Kong or Singapore or wherever if the opportunities are better there. Obama seems to have no understanding of that.

We have been hearing for years that social security will bankrupt the country. And it will. The Baby Boomers start drawing their social security retirement benefits in five years in 2014. There is no money in the bank to pay them.

Medicare is worse Alan Greenspan was asked what will bankrupt the country first. He answered “Medicare” and gave the same answer years later when asked again. Medicare is a medical program for the elderly. The Baby Boomers hit 65 in three years.

Medicaid is another program we have been told will bankrupt us. And it will. It is also a program that will be hit by a Tsunami of Baby Boomers is a couple of years.

Several “progressive” states have tried to enact universal health care. All were forced to back off of it within months. It costs too much. Yet Obama is going to enact it right now.

He is also going to pay to send everyone in America to college or vocational school after high school. And spend hundreds of billions on solar and wind, which has already had tens of billions spent on it and it still hasn’t made economic sense. And he is still encouraging a trade war that will all by itself throw the world into a Depression. And he’s going to give 98% of the population a tax cut.

And who’s going to pay for all this? Not our grandchildren. gee, I’m glad to hear that. No, the top 2% who make more than $250,000 a year are going to get their taxes increased and all of the above will be paid for by them and only them.

Well, that would be me and my wife among others. Memo to Mr. Obama: We cannot afford to pay for all that even if we were stupid enough to do so. Richest man in the world Bill Gates’ entire net worth would not pay for even 10% of the “stimulus” bill. We are not stupid enough to do so. If you raise our taxes, we will look for ways to reduce them. I am the author of the book Aggressive Tax Avoidance for Real Estate Investors, now in its 19th edition. If I cannot find such legal ways, I will probably decide that making more than $250,000 a year is not worth the effort and let my income drop down to $249,999. It won’t affect our lives much. I expect most others will do the same.

Others will decide that cheating on their taxes is too valuable to not risk it. The higher tax rates go, the more people cheat. People can also move to other countries with lower tax rates, if they renounce their citizenship. Obama’s turning the U.S. into a socialist country will no doubt cause many to do just that, especially those with high earnings.

In short, Obama’s speech was incoherent. There is not enough money in the world to pay for all the stuff he promised. We cannot even afford the stuff we enacted into law before last year. And his additional promises that we will not leave a big debt for our grandchildren or raise taxes are even more at odds with reality. Yet every time he made another insane promise, the audience stood up and applauded again.

America has lost its mind. Reality, national bankruptcy or hyperinflation is what we will get. How many years from now? I will look for media stories by experts who run those numbers. It can’t be much longer.

I appreciate informed, well-thought-out constructive criticism and suggestions. If there are any errors or omissions in my facts or logic, please tell me about them. If you are correct, I will fix the item in question. If you wish, I will give you credit. Where appropriate, I will apologize for the error. To date, I have been surprised at how few such corrections I have had to make.

Tim Russert

My oldest son Dan called my wife and me on Friday, 6/13/08 to give us news he knew would be important to us. Tim Russert had died.

Doggone it!

My wife always DVRed and watched Meet the Press. I liked to watch Tim’s other show, Tim Russert, on MSNBC as well.

He had an almost unique and wonderful combination of qualities:

A. authenticity

B. extreme likability

C. substance

The only other prominent living person I can think of with that combination is Doris Kearns Goodwin (who revealed herself to be totally in the tank for Obama, as opposed to being an objective profesional historian, on Charlie Rose on 8/19/09). The recent death of William F. Buckley, Jr. reduced that list by one.

The Buffalo Bills

Historian Goodwin was a frequent guest on Russert’s shows. Like Russert, she was also a famous sports fan. She loved her Red Sox; Russert, his Buffalo Bills, as well as the Yankees and Washington Nationals baseball teams. The Bills became a little bit more important to me a few years back when I was writing a new edition of my book Football Clock Management and I called the Bills to try to interview their retired, long-time coach Marv Levy about their whole game no-huddle offense. He was kind enough to call me and talk to me for about an hour. Later, when I sent him the finished book, he sent me a testimonial for it which immediately became, and still is, the most prominent one on my reader comments page.

Come to think of it, Levy belongs on that list of authentic, extremely likable, substantive, prominent people.


Ironically, Tim died the friday before Father’s Day. Fatherhood was more important to him than to most people. One of his best-selling books was called Big Russ & Me. He also wrote Wisdom of our Fathers.

Big Russ was his father of whom he often spoke and whom he called after every Meet the Press Show. He also often talked of his only child Luke as well. Russert had recently gone to Italy with his son who just graduated from Boston College. I actually took my youngest son, Mike, who had never been out of the U.S., to London, Paris, and Rome at the end of May, 2008. It would have been fun to have run into the Russerts in Rome.

On May 11, 2008, Russert had this exchange with Clinton money man Terry McAuliffe:

"But it’s not impossible for Hillary Clinton to win," said McAuliffe. "A lot of people have said that. Big Russ, if he were sitting here today—nothing’s impossible. Jack McAuliffe, if they were with us today, they’re probably both in heaven right now Tim, probably having a scotch, looking down saying, you know what: this fight goes on. It’s good for the Democratic Party. Millions of people coming out to vote, it’s exciting."

Not missing a beat, Russert quickly corrected him.

"Big Russ is in the Barcalounger [in Buffalo, not heaven] still watching this," he said. "God bless him."

Tim is survived by Big Russ.


I can relate to Russert’s middle-class, Buffalo roots. I grew up in the lower-middle-class New Jersey suburbs of another Northeast Rust Belt city, Philadelphia. The adults in my life were not college grads, didn’t have much money, didn’t know much about the world beyond the metro area, but they were good people who knew enough about what’s important.

I understand the late Senator Pat Moynihan’s comment to his then assistant Tim Russert. They were at a reception cocktail part full of Ivy Leaguers. Russert graduated from John Carroll College and Cleveland-Marshall College of Law. Moynihan was concerned that Russert would be intimidated. He told him, “You can learn what they know. But they can never learn what you know [from growing up middle class in Buffalo].” In addition to growing up on one of the lower socio-economic rungs of the ladder, I have since graduated from Harvard Business School, as has my wife, and our oldest son, the one who called us about Russert, graduated from Columbia. So I know the truth of Moynihan’s statement from both sides of it.

The Ivy League is a great thing and its graduates have done many great things. But there is also greatness of a different sort in the backyard barbecues of places like Buffalo and Haddon Township, NJ.

Born to do it

I have written 30 some books (70 if you count editions). The one I sell the most of is called Succeeding. It’s main message is that you need to figure out who you are and match that up to a career. It is hard to think of a better example of a guy who did that than Tim Russert.

My main reason for giving my readers that advice was to lead them to happiness. But I added that if you do something you love and were born to do, as a bonus, you are likely to be more successful because you love it. One of the subheads in my “Career Choice” chapter is “Ya gotta love it.” Others are “What you did for love,” a reference to the song from Chorus Line and “Working 20 hours a day and loving it,” a T-shirt slogan from the Apple Computer Mac team. Once again, it is hard to think of a better example of someone who proves that than Tim Russert.

Conversely, I added that if you do not get yourself into a career that you were born to do and love, you will likely be competing with someone who did and he or she will kick your butt. Once again, it is hard to think of better evidence to prove that than Tim Russert.

‘Every, every minute’

Because of Russert’s relative youth—age 58—we assumed we would have him for decades to come. He was a bit overweight. I don’t know if that reduced his life span, but let’s be careful out there. Take care of yourself.

We took Tim for granted. He was a national treasure whom we failed to treasure enough when we had him. It was characteristic that he, on the other hand, seemed to treasure every minute of life.

I am reminded of the key scene in Thornton Wilder’s play Our Town. The main character, Emily, dies young. In heaven, she learns that she can return and observe a day of her life, although it is not recommended. She insists. She is advised to pick an insignificant day, which she does. Here is what Wikipedia says about that scene.

Emily decides to revisit her twelfth birthday. She is initially overwhelmed with joy but quickly succumbs to tears when she realizes how much she took for granted when she was alive and how quickly life speeds by. She says "We don’t even have time to look at one another." After one last look at Grover’s Corners and being alive, Emily tells the Stage Manager she is ready to go back to the graveyard. She asks, "Doesn’t anyone ever realize life while they live it? Every, every minute?"

Happy Fathers Day,

John T. Reed