Thomas Sowell’s latest book, Economic Facts and Fallacies, couldn’t be more topical. As the Obama Administration lays waste to American prosperity with its economically illiterate policies, this admirably clear and concise primer explains just how Barry & Co. managed to get it so wrong.

The theme of Economic Facts and Fallacies can be summed up in a single sentence: “There is no free lunch.” As Sowell notes, this statement is trite precisely because it has so often been proved true. And every wrong-headed, destructive economic policy, from price controls to “affordable housing,” violates this fundamental principle of economics.

The fact that there is no free lunch explains why economics has been dubbed “the dismal science.” Contrary to what you may think, it didn’t get branded as dismal by long-suffering college students in Econ 101. No, what makes economics dismal—to politicians, bureaucrats, political activists, community organizers—is the reality check it imposes on their grand schemes for the improvement of society. The idealist is seldom a realist. There is, after all, something very attractive in the notion that sufficient commitment and compassion can sweep aside all barriers to produce the desired result—an end to poverty, say—by sheer force of will.

But whether or not a given scheme will work is an empirical question in which considerations of compassion and commitment have no place. If the scheme is ineffective or counterproductive, it simply won’t produce the desired results. And the more passionately it’s pushed, the more damage it will do.

Sowell gives several examples of misguided social engineering that not only failed to solve problems but created new and worse problems, e.g. rent control, a well-meaning policy that has made it well-nigh impossible to find a decent, reasonably priced apartment in cities like New York. He also discusses facts and fallacies surrounding such issues as incomes, higher education and race.

Economic Facts and Fallacies is written in Sowell’s plain, unadorned style—prose like a window pane, as George Orwell would have said. Buy this book (available for the Kindle), read it, and be enlightened. Especially at a time of economic troubles like the one we are living though, era of economic malaise, Economic Facts and Fallacies is a must read.

Posted by tmg110 at 8:12 AM EDT

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Having not watched it myself, I defer to the analysis of Michael Barone, who makes two interesting points in this article: (1) Mitt Romney turned in a solid performance, looking and sounding like the frontrunner that he may or may not be; (2) Michelle Bachmann confounded those critics who call her inspirational but ditzy, showing herself to be a serious contender.

Barone goes on to note that Tim Pawlenty performed below expectations, failing to drive home his attack on Mitt Romney’s healthcare reform in Massachusetts—the prototype for Obamacare. Newt Gingrich turned in a mixed performance, Herman Cain showed once again that he knows next to nothing about defense and foreign policy, and Ron Paul was Ron Paul.

I was most interested in Barone’s comments on Michelle Bachmann. I confess that when she first impinged herself upon my consciousness I, too, thought that she was a bit of a ditz. But maybe, Like Ronald Reagan, she’s one of those fortunate people who goes through life seeming less intelligent that she actually is. That’s a considerable advantage for a politician—and Bachmann may turn out to be far more formidable as a candidate than many expect.

Posted by tmg110 at 7:46 AM EDT

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Captain Compassion…excuse me, President Obama…had them rolling in the aisles with this little quip at yesterday's meeting of the Council on Jobs and Competitiveness:

One of the Council's recommendations to President Obama was to streamline the federal permit process for construction and infrastructure projects. It was explained to Obama that the permitting process can delay projects for "months to years…and in many cases even cause projects to be abandoned… I'm sure that when you implemented the Recovery Act your staff briefed you on many of these challenges." At this point, Obama smiled and interjected, "Shovel-ready was not as…uh…shovel-ready as we expected." The Council, led by GE's Jeffrey Immelt, erupted in laughter.

Yeah, and I’ll bet that the people who go to make up the nation’s current 9.1% unemployment rate were laughing right along with Barry and his pet fat cats.

Posted by tmg110 at 7:17 AM EDT

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Really, though, how is the economy doing? After all, things aren’t as bead as they were when Obama took the oath. So maybe Debbie Wasserman Schultz had a point when she claimed that the Prez and his team have turned things around.

It’s true that according to the textbook definitions of “recession” and “recovery,” the former has ended and the latter is underway. But if you examine the actual economic climate, as Irwin M. Stulzer did in this article for the Weekly Standard, the scenario doesn’t seem quite as rosy as Debbie and Barry would have us believe:

The key here is uncertainty. Not uncertainty as to whether short skirts will sell better than long skirts, or muted colors will prove to be the fashion choice for the autumn, or even whether interest rates will rise. That’s the sort of uncertainty businessmen have lived with ever since there were markets, and for which they get the big bucks to predict accurately. It is political uncertainty.

 

Talk to any banker and, if candid, he will tell you he can live with almost any regulation that comes out of Washington. He will either figure a way around it, or learn to live with it, perhaps passing on its cost to consumers. But when somewhere out of sight hundreds of regulators are working on thousands of pages of regulations to implement the Dodd-Frank law, he takes fright. Not knowing what is coming down the road, uncertain whether the president will decide once again that he needs bankers to serve as piñatas to provide impetus to his flagging reelection campaign, he becomes gloomy. That affects not only how investment bankers run their own businesses, but how they advise clients who are sitting on $2 trillion of excess cash, earning almost nothing, and too uncertain to invest it in new plant and jobs.

Elsewhere in his article, Stulzer discusses the ill effects of Obamacare, which by making labor costs less predictable is having an adverse effect on job growth. Bottom line: The policies of the Obama Administration are throttling the recovery by preventing the strong GNP growth and job creation that would otherwise have occurred. The Community Organizer-in-Chief seems to have flunked Econ 101.

Posted by tmg110 at 8:44 AM EDT

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…in the form of another astonishingly stupid claim that Barack Obama has “turned this economy around.” (Try telling that to millions of chronically unemployed Americans!) Here’s the hapless DNC chairperson, doing her inadequate best to defend the indefensible on Meet the Press.  Not even the liberal-minded David Gregory, conducting the interview with Wasserman Schultz and RNC Chair Reince Priebus, could swallow Debbie’s snake oil.

Amazing that the smartest chief executive in the world—nay, the Galaxy—picked this dull-witted shrew to head the Democratic Party! But then, Barry also chose Joe Biden as his running mate…

Posted by tmg110 at 8:21 AM EDT

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Charles Kruathammer asks: "Is It Incompetence or Ideology? Should Republicans run against Obama’s hyper-liberalism or his abysmal economic stewardship?"

Huh? There’s a difference?

Posted by tmg110 at 8:03 AM EDT

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Once upon a time, California was America’s El Dorodo, the land of our dreams. The Golden State’s hold on the national imagination was such that in the Library of America was able to publish Writing Los Angeles, a literary anthology focused on California’s largest city and cultural capital. It runs to 880 pages.

That’s why it’s so sad to watch California’s progressive political establishment run the nation’s largest state into the ground. And of all the damaging policies with which they’ve burdened California’s economy, the worst are those relating to the environment.

In California, being green is a species of religious fundamentalism, as Joel Kotkin relates in this article for Forbes. And the consequences of green fanaticism have been dire for the state’s economy. Kotkin notes, for example:

California, still the nation’s third largest oil producer, should be riding the rise in commodity prices, but the state’s green politicians seem determined to drive this sector out of the state. In Richmond, east of San Francisco, onerous regulations pushed by a new Green-led city administration may drive a huge Chevron refinery, a major employer for blue collar workers, out of the city entirely. Roughly a thousand jobs are at stake, according to Chevron’s CEO, who also questioned whether the company would continue to make other investments inside the state.

Read the whole article—not only as the tale of a once-great state’s sad decline, but also as a preview of the future that Barack Obama desires for America. The policies he advocates for the nation are precisely the ones that are transforming the American El Dorado into a Third World theme park. 

Posted by tmg110 at 7:49 AM EDT

Updated: Friday, 10 June 2011 7:51 AM EDT

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Democrats and progressives—but I repeat myself—keep insisting to one another and to the rest of us that Barack Obama is on course for reelection. The man is a superstar! He simply can’t be beat! This chorus of reassurance reverberates in shrill counterpoint to the month-by-month deterioration of the US economy that Martin Feldstein outlines in this op-ed piece for the Wall Street Journal.

The Democrats’ rather forced optimism does, however, have some basis in reality. In Barack Obama they have a true, certain and undoubted 2012 candidate: a known quality with an impressive 2008 victory on his resume. The Republicans have a large and rather disorderly field of presidential hopefuls. So if the election were held today…

Ah, but the election’s in November 2012, and by then Barry will be facing just one GOP candidate. Maybe he’ll catch a break and that candidate will turn out to be Donald Trump. If I were him, however, I wouldn’t count on it. And if I were a Democrat I’d be very nervous indeed about Team Obama’s developing strategy: to deflect people’s attention from the President’s spotty record by running against “Republican extremism.” To that, the GOP candidate will have a powerful counterblast in the form of this simple question to voters: “Are you better off than you were four years ago?”

Posted by tmg110 at 7:01 AM EDT

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Being Catholic, I hear quite a lot about “Catholic social teaching”—and to be frank I’m getting tired of it. Specifically, I’m tired of hearing that to be a good Catholic, I must honor the secular pieties of progressivism.

The problem with Catholic social teaching is that when it sticks to generalities you get truisms, and when it becomes specific you get liberalism. To be clear, I have no quarrel with the Church’s basic teaching that you and I have a moral obligation, as individuals, to feed the hungry, comfort the afflicted, etc., etc. And the Church, to its great credit, provides many opportunities for individuals to discharge that responsibility.

What bothers me is that when the Church gets specific about social problems like poverty, it turns out that government is the solution, and that empowering bureaucrats and community activists to “solve social problems” is an act of Christian charity.

Do you see what wrong with that? First it assumes a fact not in evidence: that government is the solution. Recall that the US federal government fought a war on poverty and lost—an unfortunate historical tidbit that well-meaning activists prefer to overlook. Indeed, a good case can be made that government intervention often makes social problems worse, not better.

But the worst thing about Catholic social teaching where it intersects with the political process is that it introduces a principle of coercion into Christian charity. You and I may both desire to do something about homelessness, yet disagree most profoundly about the means to that end. The political process is a way of settling the debate by allocating power to one side or the other. If you win, I have to go along with your solution whether I like it or not.

If Christian charity isn’t voluntary, it’s neither Christian nor charity. And I doubt that God will give you much credit for forcing me to do it your way.

Posted by tmg110 at 9:27 AM EDT

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I thought at the time she was tapped by President Obama to head the Democratic National Committee that Rep. Debbie Wasserman Schultz, Democrat of Florida, was an affirmative action hire. One can almost read Barry’s mind: “A black prez and a female DNC chairperson—cool!”

But Obama’s clever pick turned out to be un-cool in the extreme. Making up in brain-dead cluelessness what she lacks in charm, Debbie has become quite the figure of fun. Even the mainstream media roll their eyes when she delivers one of her literally incredible attacks on the GOP. Now American Crossroads has released this hilarious attack ad on “Debbie Downer.” It’s precisely the kind of image reinforcement that the Democratic Party doesn’t need as it heads toward a tough campaign in 2012.

Such are the perils of affirmative action—if AA does indeed explain Debbie. The alternative—that she really was the best, most qualified person that Obama could have picked to chair the DNC—would be a sad commentary indeed on the state of the Democratic Party.

Posted by tmg110 at 8:20 AM EDT

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