Fix Virginia First

What to do after an economic bubble bursts.

The economic crisis is an economic bubble. It’s a very big bubble. But, it isn’t an economic meltdown or the end-of-capitalism-as-we-know-it, hysterical hyperbole. Even if politicians, the news people, and losing special business interests bleat that it is so. Yet, a 24 month adjustment – tops – can become a disaster if the politicians use the statist and socialist tools which made the Great Depression worse – and longer. Since it appears that President Obama and Democrat majority in Congress will do, precisely, what is wrong economically and right politically – then we need to fix Virginia first. Cut taxes, cut spending, reform entitlements to build individual savings.

This isn’t rocket science. Nor, is it the inscrutable intricacies of high finance. It is Economics 10. Niall Ferguson nails the past, present and makes interesting suggestions about the future in his “The Ascent of Money.” He calls today’s crisis as it was unfolding in 2007. His book is a tour de force about economic history that is readable, understandable, and incredibly prescient. It’s history at its best – the past providing prologue for the present.

The guidance is simple. The best way forward is painful in the short term, but rewarding as soon as possible. Obey the laws of economics like following the laws of physics. Don’t jump off a building in physics = no financial institution is too big NOT to fail in economics. Oops, since it’s too late to let the losers on Wall Street and in Detroit fail, we, The People, are out at least $1 trillion. Or, rather, the debt load on the next generation has increased by more big bricks. So, what’s Virginia to do when the Federal government mangles the market and bungles the economy?

Follow the laws of economics in this market of 7 million persons.

Our Commonwealth exists in our unique economy that has evolved since civilizations started in 4000 BC. Virginia is an evolving place in time with a traceable history. The economy is constantly changing – and will into the future. The basis of this economy is capital. Money.

Capital is to a family what the farm, the fishing boat, or hunting party was to our ancestors. It’s the basis of our survival. It’s the means to whatever materialism we pursue. Available capital is the measure of individual economic opportunity that has become essential and intertwined, like a helical of DNA, with individual freedom.

Yes, America was for the most part poor and free for much of its history. But, the dislocation of labor from the farm with industrialization era and urbanization – and the fragility of employment with the information era and globalization – makes individual capital = the family farm.

Farmers can provide for their family and make some profit based on the certainty of what their labor produces – and subject to the uncertainty of weather. Most Virginians have a job and a savings account instead of 40 acres. The security of the soil must be replaced by more security in savings. Growing capital as a crop is essential to provide for the Good People of Virginia. Every Virginian can, and must, have personal savings.

Government can’t create capital or jobs. Virginia must protect the free functioning of the marketplace just as it is supposed to protect individual freedoms. This is limited government, not laissez-faire, in action. It serves the individual sovereign of the state – while defending the working person from abuse and the environment from damage. It turns government from serving special interests as Virginia does now.

We must fix Virginia, first, for more, better economic opportunity – to enable, expand and enhance personal freedom for the individual to chose where and how he works, lives, plays and raises a family.

Cut taxes. Cut personal and corporate taxes.

Cut spending. Stop un-Constitutional spending.

Cut market interference in the production of energy – without sacrificing the environment.

Reform entitlements, like Virginia’s formula for Medicaid.

Reform mandates, like Virginia’s Standards of Quality for education. The SOQs have been updated, but they need to be reformed.

Encourage individual savings. Provide the tax incentives. Take the ’04 half percent sales tax sham and convert it into Commonwealth Trust Accounts for each Virginian. Focus the accounts as health savings accounts now. Expand their uses later as they grow.

Elect the politicians who can tell Virginia – before the ’09 election – what taxes and spending they will cut, how they will reform entitlements and grow individual savings.

Finally, know that an ‘economic adjustment’ = hard personal hardship for families. Their pain is real. The healing medicine includes incentives for charity and tough love, not government handouts. Government generosity makes matters worse – slows the recovery of the economy – and, sooner or later, punishes every family getting back on their feet.

Let’s fix Virginia first. Now.

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54 responses to “Fix Virginia First”

  1. Anonymous Avatar

    OK, fine, let’s fix Virginia first.But you seem to be leaving out a big part of what has been a big part of Virginia’s economic history — federal spending.

    Since WWI and even more since WWII, the state has benefited enormnously from federal spending, especially military. A horn of federal plenty stretches from NOVA down I-95 to Richmond and on I64 to Tidewater. The latest blast of federal money came after 9-11 when firms such as CACI and Anteon got lots of government bucks.
    BRAC spending is going to buoy the state. Look at Richmond. Circuit City and Qimonda are going belly up with a total of 32,000 or more lost jobs nationally, maybe about 3,000 or 4,000 in Central Virginia. What’s going to help them? BRAC-inspired additions at Ft.Lee where you are adding thousands of troops and their families. Ft. Belvoir and Quantico are boosting NOVA with such new facilities as an Army hospital. If Obama’s stimulus ever gets past the GOP, Va. is likely to get a good cut, especially with Kaine in charge of the DNC.
    I agree with you about the ills of bailing out failing and overpaid execs. Tax cuts are needed right now. But it is time to realize that a period of spending, not Thatcher-style cuts, is what is needed.
    We need to all genuflect and hail John Maynard Keynes who will be making a comeback, at least for a little while.
    Peter Galuszka

  2. James Atticus Bowden Avatar
    James Atticus Bowden

    PG: I was with you almost until the end.

    We need tax cuts now.

    We do NOT need new more spending at the federal, state or local levels.

    If you want to pay homage to Keynes, then celebrate his work on uncertainty, but not on government spending.

  3. Anonymous Avatar

    Maybe there’s a misunderstanding. I am with you on tax cuts now. I am not with you on cutting government spending now. Yes to one, no to the other.

    I will send you a picture of my new shrine to J.M. Keynes. Offerings are welcome!
    Peter Galuszka

  4. James Atticus Bowden Avatar
    James Atticus Bowden

    PG: I’m a half-loaf guy. If I can’t get a whole loaf of bread, then I’ll take a half loaf.

    Yet, since thee and me aren’t in charge of anything other than our keyboards, we’ll have to settle for spectator sports – and no bread sharing at our behest.

  5. re: “Government can’t create capital or jobs.”

    tell that to the folks who build and maintain warships in Hampton Roads/Tidewater.

    The Government DOES create capital – by taxing people and they DO create jobs by paying folks to build/operate things the Government deems important.

    People get confused IMHO.

    They think that the same government can’t use the same taxes it collects to pay to build/maintain/operate stuff other than military hardware.

    So.. if we spend tax money on non-military stuff ( like Smart Grids or wind turbines) – it is an wanton and destructive act -but if we spend it on Humvees or Seal cammando gear.. it’s a “need”.

    I understand the argument about taxation and government spending.

    what I don’t get is the same folks who say Government spending is a waste – don’t have a problem with it if it is spent on military stuff.

    Let’s be honest.

    The Government CAN create capital and it CAN create jobs.

    It’s done it for as long as it has collected taxes – and spent those taxes on things it deemed important to the country.

    There is no doubt that a Humvee qualifies – at least in the minds of many.

    How many we should build or whether some Humvees can be wind turbines instead – seems a more difficult question.

    I’m not even advocating that the government should build wind turbines either.

    I’m only pointing out that a Humvee and a Wind Turbines both employ people… and create jobs.

  6. Anonymous Avatar

    “Farmers can provide for their family and make some profit based on the certainty of what their labor produces – and subject to the uncertainty of weather.”


    The average profit for all farms in a five county area according to the 1990 farm census was negative$2000. Of 200 farms in my county maybe 20 make a “profit” and that profit depends on government subsidies.

    To make a modest living growing soybeans you would need 990 acres.

    Almost all farms depend on off farm jobs – no jobs, no farms.

    Just trying to dispel a few nostlgic but wrong ideas about farming in general and VA in particular.


  7. James Atticus Bowden Avatar
    James Atticus Bowden

    Larry G: Government takes in $1.00 to producs 23 cents in goods and services (in general). So, yes Virginia, government can create jobs – at a net loss of capital – which is what counts to the economy.

    So, saying it again, if the Navy produces $1B in jobs at NN Shipyard, the government took in far more than $1B to produce those jobs.

    That is why it is important to limit the jobs and services produced by government to a minimum or you have socialism and a failed economy.

    RH: Farms is an analogy for capital. Understand small farming is hard to do nowadays.

    Every farm has to make a profit or be subsidized by other income as you indicate – sooner or later – or the farm goes away.

  8. Anonymous Avatar

    Cut taxes and cut spending until when?

    Until government has no revenue and taxes are zero?

    Until every bridge collapses, and there is no one and nothing to take care of the common wealth with?

    I get tired of the same song with no end in sight. Give us a total tax rate and minimum budget that the Republicans could live with: the level at which they woud be satisfied to shut up and go home.

    And then explain how they think we can get by with it. How long before all our infrastructure decays to pieces.


    Meanwhile, hae the Dems explain why it is that if a trillion dollars is good for the economy , then why not spend 10 trillion? At some level their ideas are equally as whacky as the Republicans.


    The Republicans want more tax cuts, which they claim will act faster than spending. I’m not so sure that is true.

    The other problems with tax cuts is that you have no idea how, when, or if they will be spent. You ASSUME they will be spent the best way for each family’s and business’ needs.

    That much is probably true as far as it goes, but the usual situation is that the tax cut as parceled out winds up like being a coupon in a class action suit – it is virtually wortless as far as meeting substantial needs is concerned. The Republicans cannot show us how tax cuts will prevent the next bridge from falling.

    So, both the power and the weakness of tax cuts is that the spending is not “directed”.


    The weakness of “directed” spending as propopsed by the Democrats is that someone will always call anyone else’s project pork.

    But at least occasionally you can mass enough energy and effort to pull off something private eneterprise will never do. We would still be waiting for the Apollo Project.


    It is going to take some of both to get anything worthwhile done, so lets get off our ideological hobby horses and do some real work.

    I fundamentally agree with JAB and yet I feel that continued one sided arguments such as this will sink the Republican party for 20 years. While agree with the logic I can’t agree with the degree: it isn’t as if the Laffer curve peaks at 20% total tax level – probably it is more like 60%. The reason Reagan was right was the he was actually getting taxed at 90%, at one time, but hose times are long gone.

    If Obama succeeds without Republican help, then they are doomed and if he fails without Republican help then they will be blamed.

    Lets can the garbarge and figure out what works.


  9. Anonymous Avatar

    Larry, if some developer or businessman comes to town with a plan the economic developer guy is going to apply a multiplier of something like three to whatever he plans to spend or bring to the table to calculate the economic benefit to the county.

    But government spending IS more expensive to pull off, and it is historically politically motivated, rather than profit motivated. There is no risk downside: no government employee will be fired if the project fails.

    So, sometimes you get lucky and you have agood gov’t porject that does provide a positive benefit and ROI, but even then they are not very good at getting the project done efficiently.

    As a result the “multiplier” for government jobs is low maybe it is only 1.2 to 2.0.

    But, government projects can be huge, much bigger than private enterprise is willing to take the risk for. And government can afford to take a longer view then the next qurter stock results. In that respect government projects can make up with volume and stability for the higher private sector multiplier, which sometimes works and sometimes turns up a zero (assuming they are not “too big to fail”).

    My advice is to forget about the jobs: for the most part they are a wash or a cost, not a benefit. Don’t compare gov’t created jobs with PE created jobs, and don’t compare mlitary jobs to green jobs.

    Just forget about, ignore, and discount anything you hear about jobs. Obama is not going to be able to achieve or prove his gaol of “creating or saving” 3 million jobs. That is simply a hoax.


  10. Anonymous Avatar

    “or you have socialism and a failed economy.”

    Norway, Sweden and several other countries operate at 50% taxation or higher. They are highly subsidized/socialized, and they outperform the US in many important social and economic metrics.

    What is your definition of failure? Not every degree of social ism necessitates a failed economy.

    Sure, the Soviet union got to the point of providing most everything except pay for their workers: “We pretentd to work, and you pretend to pay us.” and they ultimately failed.

    Virginia is a long way from there.


  11. Anonymous Avatar

    “Larry G: Government takes in $1.00 to producs 23 cents in goods and services (in general). “

    I agree the multiplier is lower than private enterprise, but it can’t be that low. Every dollar the gov’t gets is spent, so it can’t be less than one.

    If you are telling me there are WASTED goods and services, that’s different, but in our usual measurement wasted goods are still part of the GNP.

    If you told me it was $1.25, then I probably wouldn’t bother to argue, but I think 23 cents is overselling your argument.


  12. Anonymous Avatar

    “Every farm has to make a profit or be subsidized by other income as you indicate – sooner or later – or the farm goes away.”

    Thank You.

    Now go and explain it to all those people who think “We need to save “our” farms.” As long as the farmers pay the bills for us.


  13. Anonymous Avatar

    I sense that the average person would support spending on specific infrastructure projects that would produce tangible results, but probably doesn’t trust that those would be the results.

    From what I read, there are a substantial number of projects included in the various stimulus bills that provide little or no public benefit. And then, even with the real infrastructure, it’s unlikely that we won’t see more boondoggles or schemes to enrich someone’s pet real estate investments.

    Go back to the sales tax referenda in NoVA and HR. One of the main reasons both failed was the fear that the money would not have gone to the best projects, but to the projects favored by those who give the best campaign contributions. What has changed? Nada!

    What if Obama proposed to provide funds for the worst 10 bridges per 1,000,000 people in each state? Or some other measurable standard? People would be put to work; materials would be purchased; safety and ease of travel would be improved. But we fund crap to enrich a few, while leaving needed improvements undone.

    We are a very long way from change we can believe in!


  14. at it’s essence – the government verses private sector job production seems to say this:

    That is the US did not employee a sailor or boat-builder from tax money …

    and instead that money was not taxed and left to find it’s way to the private sector – that a private company would build a boat or pay a private sailor

    .. and JAB and others make the claim – “more efficiently”…

    I don’t know.

    If the government takes the money (tax) and then EMPLOYS a private sector company to build a boat – then tell me again why this is not “efficient”?

    In the end – isn’t this about the government.. essentially..preempting what we as individuals would spend some of our money on – and instead deciding to take it and spend it on something it thinks will benefit us “better”.

    Like.. they take the money I might spend on lottery tickets and they spend it on a submarine.

    So.. I don’t get the money but I get a sub instead.

    Couldn’t that sub – just as easily be a wind turbine that the government has decided that I need – more than lottery tickets?

  15. re: “What if Obama proposed to provide funds for the worst 10 bridges per 1,000,000 people in each state? Or some other measurable standard?”

    Ahhh.. this goes to similar questions.


    How many Humvees should we build?

    Are we building too many or not enough?

    or this one:

    If the govt decides that we need humvees, can that same government decide we need wind turbines or replace bad bridges?

    See..what I find funny is that the “no mo tax” folks would have hissy fits with the government building wind turbines but any number of Humvees is fine and dandy…

    .. and then the idea of the government actually fixing bridges – that leaves them in a quandry.. if it would require a tax increase to fix those bridges.

    At that point.. they start talking about waste and abuse… and inefficient government… of course.. the same government that is also buying humvees….

  16. Anonymous Avatar

    “…the average person would support spending on specific infrastructure projects that would produce tangible results, but probably doesn’t trust that those would be the results.”


    We all want what we want, but we are suspicious that someone else will get what they want instead.

    It is why we form alliances called special interests.


    “…there are a substantial number of projects included in the various stimulus bills that provide little or no public benefit….”

    According to whom?

    What is the number and what is the dollar value?

    How much of that number was a buy-off, to get something else that other people wanted?

    I’m not sure I buy that no benefit argument: it sounds too bitter and divisive as if it was really no benefit —– for me. I don’t think there is enough though or information as to WHY these things get done.

    Then again it might just be money.


    “….to enrich someone’s pet real estate investments….”

    I don’t like that argument either, for the same reasons.

    OK so some projects have externalities. We are SUPPOSED to include externalities (both positive and negative) in the cost benefit calculations.

    Why is it that we include development potential in the benefit column for transit porjects but we put it in the cost column when it comes to highways? Jealousy is no reason to cut down a proposal: we need a better reason than that.


    “One of the main reasons both failed was the fear that the money would not have gone to the best projects…”

    Agreed, sort of. There was NO PLAN for how the money would have beeen spent. Who could support raising money for a pig in the poke?

    But, I think it was a set-up. The Republicans didn’t want any new taxes and wanted it known that the people didn’t want any new taxes, so when push came to shove they put up a proposal they knew would fail.


    “Or some other measurable standard?”

    Now you are talking. But what standards? We ahve been so busy for so long arguing Dems and Pubs that NO ONE has been collecting REAL DATA on HOW WE LIVE.

    We know more about ants than we do humans.

    (I watched show recently where they pumped concrete into a giant African Anthill. After it solidified they excavated the whole thing to study African Ant Settlement Patterns.

    You know what they found? A central core with tube highways running out to the ring cities. And more tube highways running from ring city to ring city. And all along the tube highways were what only could be described as subdivisions – PODS of ants or roms of some kind.

    And looking at this truly giant, intricate structure, you could see the sense in it. Sense that was generated by independent yet cooperating ants with no real means to communicate or plan.)

    So the ants know what works, and they don’t let politic interfere. We are a long way from being able to accept measurable standards. I guarantee that the first time some special interest come up against one that violates their phlosophy, they will tie that standard up in court for thirty years, like the ICC.


  17. Anonymous Avatar

    “Couldn’t that sub – just as easily be a wind turbine that the government has decided that I need – more than lottery tickets?”

    Nice try, Larry.

    I could be a wind turbine rather than a sub, but they have different utility values. They might no t be the same ones you think they should have,

    but the government has already decided.

    I agree the process for deciding is flawed, but if we ever fix it, I doubt very much that ti will look like anything you would agree with.

    If there is such a thing.


  18. Anonymous Avatar

    “…what I find funny is that the “no mo tax” folks would have hissy fits with the government building wind turbines but any number of Humvees is fine and dandy…”

    Agreed, This is a good example of flawed selection process driven by politics and dogma.

    But even if we fix the selection process, wind turbines will be far down the list. At least that’s the way I see it.

    It might turn out the way you prefer, but not for a while yet.

    until then, if you think the consequences of not having enough wind turbines is catastrophic global warming, and someone else thinks the consequences of not have enough Humvees is global nuclear war then you can pretty much balance out the catastrophe side of the equation. Then you can concentrate on the real costs and real benefits. And if one technology needs more jobs to produce the same benefit, that goes in the COST column, not the benefit column.

    Sorry about that.


  19. Anonymous Avatar

    I think we can all agree that taxes are way too high in Virginia and the country, and that governments waste a lot of taxpayer money in a variety of ways.

    I think we can also agree that many of the major developments of the past 60 years that have generated the greatest opportunities for capital to grow have been fostered if not wholly created by our government. I’m thinking here, among other things, of the internet, electronic miniturization, nuclear technology, genetic research and communications satellite technology. When it comes to pure research, there aren’t many non-government entitys that can afford the type of front-end investment required, and the payoff to the private sector can be huge from these investments.

    So would a huge, concerted effort to subsidize targeted areas such as battery and solar panel technology needed for future growth work to jump-start the economy? Does anyone have the ability to resist the current (long time) power structure and remove the current huge government subsidies on old dirty technology such as coal and oil and gas?

    I think our economic future depends on the answer to these questions.

  20. James Atticus Bowden Avatar
    James Atticus Bowden

    Guys: Key points to address from above.

    How much to cut? Imagine the pareto-optimality curve. See that we are on the right side. The point of diminishing returns for taxes is somewhere between 8 -10 %. We have a long way to go to get there -and revenues will increase as we are cutting taxes.

    All the better to spend on the few, limited functions of government (see our Constitutions) like National Defense and to pay off the national debt.

    Tax cuts work faster because you can look at the data in the US since 1607. Not magic. And a matter of politics or opinion.

    The .23 return for every 1.00 came from my grad school Macro-econ class. Didn’t make it up.

    Underneath every socialist country or entity (like higher ed) there is a capitalist engine. Look hard for the oil, iron, or high tech products that carry the socialist burden – up to a point. There is something that produces the capital for others to enjoy in a parasitic relationship.

    As to employment and costs – consider a building that needs to be cleaned daily. You can have a private company do it, the government to contract for a private company or the government to do it with government employees. The least expensive is the private employer.

    Again, read the Constitutions to see what government is supposed to do.

    The functions of government include pubic goods -like schools (see our Constitution).

    Where there is a private demand – there will be a private supply – including pure research for some things. Where there is no private demand – like defense and space – see the Constitution. If you can’t find it, amend it.

  21. Anonymous Avatar

    All good posts JAB. Interesting that you point out the below:

    “You can have a private company do it, the government to contract for a private company or the government to do it with government employees. The least expensive is the private employer.”

    From today’s Federal Times:

    “The next Director of National Intelligence plans to bring much of the work now done by contractors back in house.
    Dennis Blair told the Senate Select Committee on Intelligence on Jan. 22 that he wants to insource any inherently governmental work now done by contractors.”

    Looks like they’re headed the other direction!

    -Rtwng Extrmst

  22. James Atticus Bowden Avatar
    James Atticus Bowden

    Thanks RWE. There may be a number of reasons for creating more government employees. The agency has to have the budget to do it – first. Then, there may be some control issues , stability, etc. that are more important to the DNI than efficiency.

    Take Defense. Do you want it to be cost-effective or cost-efficient. If your kid is in the military, you want effectiveness. Hang the cost.

  23. Anonymous Avatar

    Can you identify the current huge government subsidies on old dirty technology such as coal and oil and gas?

    Oil companies made record profits last year, but they also paid record taxes. Their tax bills were much higher than their after tax profits. Where exactly are the government “subsidies”?

    These companies sometimes pay huge fines for minor environmental infactions, sometimes just for faulty paperwork.

    Now, I’ll agree there are unaccounted for externalities, although there are disagreements over the value of these, but these are “subsidies” that we all pay for and will pay for one way or another. Either we pay for them with dirty air and water, or we pay for the cleanup. If we are paying for the cleanup, then certainly we don;t want to pay more than necessary for arbitrarily inflated damages.

    Or we can put such high taes on these activities that they effectively go under and renewables are “cheaper”. In that case we pay stillmore for electricity and we pay for clean air and water on top of that. Either way we do not want to see inflated charges to get our clean air and water.

    And either way it is us that are payingthe “subsidies” not the government.

    Can you identify the current huge government subsidies on old dirty technology such as coal and oil and gas? I don’t see them.

    Otherwise , I agree with you that the greatest opportunities for capital to grow have been fostered if not wholly created by our government. It something conservativces tend to gloss over.


  24. Anonymous Avatar

    “Imagine the pareto-optimality curve. See that we are on the right side. The point of diminishing returns for taxes is somewhere between 8 -10 %.”

    OK, I iove up, what has the pareto optimality curve got to do with taxes? I’ll agree that loweing taxes increases job production, and Ihave a derivation of the Laffer curve based on functions related to the relation ship between labor productivity and taxes. That derivation shows the laffer curve peak at 60% taxes not 8-10%.

    The full text of this derivation is at:

    It is based onthe idea that increasing taxes will decrese the equilibrium employment level, a feature I’m sure you agree with.

    The tax and employment demand curves are related in a way that is familiar from elementary price theory if we interpret the tax rate as a price variable and the relation between the tax base and the tax rate as a standard demand function.

    From that and historical values the laffer curve can be generated.

    We have been at about 30% taxes since WWII, and we have had phenomenal growth, yet we are still underfunded on infrastructure. This, plus comparison of our growth compared to other countries suggests we re still well on the left side of the curve.

    I’ve heard conservatives claim the point of diminishing returns for taxes is 20%, but 8 to 10% is pretty much laughable – we can’t even fund our schools for that. We could barely fund defense for that.

    No one suggests that higher taxes are always better. But that does not mean that the government always gets less revenue in the short or long term if it raises taxes. It’s really hard to argue that the government gets more revenue by lowering taxes below 10%


  25. Groveton Avatar

    John Maynard Keynes was a fascist, a socialist and (worst of all) wrong. He was the upper crust product of an Etonian education. His comments were part and parcel of the imperial thinking of a colonial power. He pushed his misguided and elitist theories on America at Bretton Woods with the help of his co-conspirator Harry Dexter White. White was a senior US Treasury Department official who, with Kaynes, masterminded the Bretton Woods debacle. White has been conclusively proven to be a Soviet spy. Birds of a feather flock together.

    Keynesian theory is based on the fallacious assumption that government can create wealth through spending. It cannot. The money government spends is inevitably taken from others:

    1. Taxes are taken from citizens.
    2. Debt is taken from foreign countries.
    3. Printing more money is taken from the future generations who will have to live with the wealth destruction of excessive inflation.

    For a very straightforward explanation of the somewhat obvious errors in Keynes' "logic" – see the following video:

    So, why does the "stimulus package" have so many adherents? Let me use an example. Let's say you get drunk tonight. Not just a little tipsy but rip roarin', trash talkin' wasted. You'll probably wake up tomorrow. Your head will hurt, you'll feel like vomiting, your tongue will itch. You have two choices as to what to do – work through the pain, go to sleep the next night and you'll eventually feel better or, have a little bit of the "hair of the dog that bit you". Get drunk again. After a few pops you'll start to feel better. After a lot of pops you'll feel good again. When you wake up the next day – just do it again. Of course, you'll eventually ruin your health, get trashed one time too many, go to sleep and not wake up. You'll die from one of the many maladies of chronic alcoholism. America has been swilling the rot gut of excess consumer debt, defect spending and foreign borrowing for a long time now. We've gone to sleep and woken up with a major migraine headache called the burst bubble. The banks are failing, the auto-makers are near bankruptcy, unemployment is soaring. Our political leaders have to make a choice. Deal with the pain of being on a half century long bender or start drinking again. They're reaching for the Bloody Marys. The stimulus package will have us feeling better. It will create economic growth for a while. And, like all good drunks, we'll promise ourselves that we're going to quit drinking just as soon as we drink away this latest hangover. Only that never happens. Instead, the boozing to get rid of this hangover will create another worse hangover. And that hangover's name will be inflation. It may take 3 years, it may take 5 years but the crippling fallout from this stimulus package will come and it will more than erase any economic gain from the present day spending spree. So, get in line for a shot of TARP. You'll be feeling better soon. Just try not to think of tomorrow morning.

  26. Anonymous Avatar

    “Looks like they’re headed the other direction!”

    How many times have we seen that pendulum swing?

    I’ll agree tht the cheapest way is to have a private company do the work. Bernie Madoff was a private company.

    The question is more than just what is cheapest, it is what is the best value. Clearly having all the madoff infvestigation in-house at SEC was not the best value: they should have hired that out to what’s his name, the whistleblower.

    The second question is whether it is a job private industry will do.


    I think it is a partnership where government and private industry has a role. Making it an adversarial relationship, or thinking we can do it better than you is wrong.

    I can tell you I had one (short) stint as a consultant to a government agency that was in a shambles. There was no one in that agency that had the slightest idea of program management 101.

    There was no program plan where you could trace where and when the supposed product was to go out the door, or how it was to be assembled. The schedule they had was organized by department rather than by part. And according to the schedule, every department worked independently with no interdependencies! You could see the political boundaries inthe schedule.

    There were hundreds of tasks carried on the schedule that were uncompleted, yet scheduled in the past. But yet, they insisted that all the dates on the schedule were fixed. Nothing could slip, not even the stuff that had not happened!

    There was circular logic where A happened before B, happened before A.

    It was total fantasy land.

    Finally thee was a meeting with generals at the table and they wanted to see how the managers were usng the schedule to manage their work. These were the same managers who had never seen the schedule, or had any use for it. The ones who dictated what it would say rather than see what it had to tell them.

    That kicked the problem upstairs several levels and the higher manager had his own favorite consultants. I was looking for new work the next day, and happy to be out of something I could not fix.

    The agency is still in a shambles and their product is farther behind than ever. The bureaucracy would not let the new consultants do their job, either, and they were a skilled group: I felt sorry for them.

    I would hate to be the combatants waiting for that product.

    And yet I’ve seen other agencies working complex projects to reasonable schedules with enough resources to make it happen.


    I think that “You can have a private company do it, the government to contract for a private company or the government to do it with government employees. The least expensive is the private employer.” is a false trichotomy.

    The best result is probably some combination, with both the tendency for firms to cheat or cut corners and government to be control freaks held tightly in check, somehow.

    We’ve evolved an adversarial contractul situation where no one cnan get their job done effectively.


  27. Anonymous Avatar

    OK Groveton, what about all the good stuff government has managed to do?

    With other people’s money, same as corporations.

    Governemtn has SOME spending advantages over corporations, and some ethical advantages as well. They can take a longer view, serve minority interests, and operte without competition when needed.


  28. Anonymous Avatar

    Groveton: “America has been swilling the rot gut of excess consumer debt, defect spending and foreign borrowing for a long time now. We’ve gone to sleep and woken up with a major migraine headache called the burst bubble. The banks are failing, the auto-makers are near bankruptcy, unemployment is soaring. Our political leaders have to make a choice. Deal with the pain of being on a half century long bender or start drinking again.”

    I agree with all the above, but how do we “deal” with it if not with the stimulus package? I don’t think anyone wants to see billions of their tax dollars going down another rat hole, but I think there is at least some evidence that government stimulus has worked in the past to blast an economy out of recession. WW II spending ended our great depression, and it has been argued that the government stimulus was removed too quickly in the Japanese downturn, causing a renewed recession.

    But let’s ignore all that and assume that government spending won’t help and will lead only to higher taxes and inflation. I’m probably missing something, but what do we do? Do we take a “market correction” approach and let the banks, GM, Chrysler, etc., etc., all fail and deal with the consequences? I agree, they certainly would deserve it, but what would be the result to our economy in the short term? What else can we do to deal with the situation?

    I’m honestly asking here, I just haven’t seen a viable alternative. The stimulus package needs a lot of work in my opinion, there’s a LOT of pork in there, but it could be used to incentivize the areas needed for energy and environmental sustainability in the future. Of course, that would take leadership and bipartisanship, so I’m obviously dreaming!

  29. What happens if we don’t do a stimulus?

    I’ve never been quite clear on the specifics – only that conventional wisdom seems to think it would be very bad.

  30. re: “if it is your kid and his well-being, expense be damned”.

    Okay.. let’s put this in Virginia terms.

    Our current budget cuts funds for deputies.

    The various law enforcement agencies around the state are saying that this is a bad thing and that if these cuts are implemented, criminal threats to moms and kids will increase.

    Does Virginia take the same approach with Crime and the Nation takes with Defense?

    Specifically, should Virginia raises taxes to maintain level funding for deputies?

    why? why not?

  31. Anonymous Avatar

    Larry, I think that you raise some good points, but where I fall off the wagon is, IMO, several assumptions that the current level of staffing is necessary to achieve the desired results and that the current funding priorities are reasonable under the circumstances.

    Government agencies, at all levels and regardless of political control, are quite good at the Chicken Little Game. Closing the Air Force base at XXX will threaten national security; not giving the teachers a cost of living raise every year will mean all the good teachers will leave; not funding the Fairfax County Economic Development Authority will mean no one will have a good job because companies won’t come to Fairfax County. Prove it.

    Maybe, Air Force base at YYY is sufficient to handle the defense needs; maybe the costs of moving to a different school system (which also may not be giving cost of living raises)outweighs the costs of staying where the yeacher is for a year without a raise; maybe the beltway bandits will come to Fairfax County anyway because you cannot be a beltway bandit in St. Louis.

    Moreover, if some of these programs are so important, why can’t we cut something else?

    I went to a “meet and greet” for Terry McAuliffe yesterday. One of the first things he said was: “We cannot raise taxes in Virginia if we want to get the economy moving again. We need to get more well paying jobs in Virginia.” Now, both Mark Warner and Tim Kaine said similar things about taxes and then went in other directions, so I’m not yet ready to trust TM fully. But here’s a guy with strong liberal credentials challenging the idea that raising taxes fixes everything.

    If saving funding for sheriff deputies is a top priority, what programs are not top priorities?


  32. James Atticus Bowden Avatar
    James Atticus Bowden

    RH: Consider pareto-optimality for total tax burden vs income. The average Virginian in 2005 paid 32.9% total tax burden (as opposed to 29.2 in 1975).

    Start walking that burden back towards 10% and see what happens to tax revenue. If we got it down to 20% total it would be marvelous.

    As to your other posting, please consider what Government should do, not what it can do. Read our Constitutions.

    Why is Government intervention on behalf of minorities – I presume you are talking about business set asides, quotas, etc instead of individual voting rights. Group rights were discussed and dismissed at the Constitutional convention. Special privileges based on race are anathema to the ideas from our Declaration of Independence. Identity politics will be our doom.

    Government should do what the Constitution says, not what statists want.

    Groveton: Thanks. Good analogy.

    Anon: If you let the market do its work – let the Big 3 go into bankruptcy and banks fail (oops $1 Trillion late on that), then the economy turns around in less than 24 months. If you cut taxes, all the better and quicker.

    The result is devastating locally. Go see what a mine town looks like after the mine gives out. But, the national ecnomy recovers and the mobile player rule of capital kicks in where money goes where money can be made (and some labor follows – some labor never leaves and gets by)

    Larry G: You post was answered well by TMT.

    Here is more of the same. DoD spends billions to analyze and say how much is enough for defense (see the classic book “How Much Is Enough” by Alan Enthoven about how McNamara created the analysis industry in DoD).

    Meanwhile, Virginia has no clue what one deputy more in any county or city means. No one can tell you how much crime prevention (if any) vs crime solving one deputy brings (two very different measures).

    If you want the economy in Virginia to improve – cut taxes, cut spending, reforme entitlements, and let the market produce more energy.

  33. Anonymous Avatar

    “We’ve evolved an adversarial contractul situation where no one cnan get their job done effectively.”

    Which is why these stimulus plans are doomed to failure. Never mind private industry, the number of government personalities with their hands out resemble vivid pictures of warlord troops massing behind UN relief trucks.

    A drastic vision, you say? Business as usual, sez I. It is the rare contract foot soldier who will cross invisible lines of implied authority. Yet agencies, departments, and even divisions within a department, will seek solutions to their problems through clandestine means. Just answering a simple question for someone in the next office can invite attack by Your governmental warlord. “Say nothing, do nothing.” is right up there in the Contractor’s Ten Commandments.

  34. E M Risse Avatar

    Interesting comments but how about the big picture:

    The current structure of governance was created before contemporary economic, social and physical structures were even imagined. From the perspective of human settlement pattern the most important components of the existing governance structure are the Declaration of Independence (1775), The Northwest Ordinances (1784, 1785 and 1787) and the Constitution (1789).

    The 1775 to 1789 system of governance was crafted for an emerging nation-state where:

    • Five percent of the population was urban and ninety-five percent of the population was agrarian.
    • Where communication meant physical travel of people of written material
    • A society with slaves, no women’s suffrage and the vast majority of the citizens were illiterate.

    Add to this the fact that the Industrial Revolution was in its infancy and the importance of trade, technology and communication taken for granted today would have been incomprehensible to citizens and their leaders in 1790.

    The 1775 to 1789 governance structure, as amended to date, is in many ways irrelevant to a society where:

    • Nine-five percent of the population is urban and only five percent is agrarian
    • Communication is instantaneous
    • Universal suffrage and education are overarching goals

    The federal Constitution provides for protection of critical, overarching rights and responsibilities. However, the powers reserved to the states allows state Agencies to play an ever more damaging dog-in-the-manger role in governance structure.

    Even though the state as a level of governance grows less relevant with each passing day, states continue to avoid the absolute necessity of Fundamental Transformation of governance structure. This is especially true for those states that straddle one or more Regional (NUR or USR) boundaries.

    Almost all of the ‘Lower 48″ states straddle Regional boundaries. Seven states include parts of Regions that fall in more than one nation-state.

    Caught between:

    • Municipal (including county) governance practitioners who believe it is in their best interest to thwart the evolution of functional governance at and below the Alpha Community scale; and

    • State governance practitioners who believe it is in their best interest to thwart the evolution of functional governance at and above the Alpha Community scale – especially at the New Urban Region scale; and

    • Federal governance practitioners who believe it is in their best interest to thwart the evolution of functional governance at all scales;

    Citizens have no current voice or leverage to secure Fundamental Transformation of governance structure.

    In the Commonwealth, the state legislature cannot even close the gun show loop hole or tax tobacco so that the tax can cover even part of the total cost of health care for smokers.

    (Yes the tobacco tax proposal would not go directly to health care but see discussion of larger problem above for the reason governance practitioners are scrambling to find solutions.)



  35. Anonymous Avatar

    Thank you for your searing critique of John Maynard Keynes. I wish I had this in my notes when I took economic 101 back in 1971 when Keynes was everything and those 25-year-old TA’s handling the intro course made us recite why it’s perfectly okay to have deficit spending.
    I am sure everything you say about his personal life is true that he was an unbearable Brit snob who may have been a Soviet spy (wasn’t he married to a Russian ballerina and weren’t jujst about all of his students NKVD recruits?).
    I’m just enjoying the irony of his thoughts becoming fashionable again.

    Peter Galuszka

  36. Anonymous Avatar

    “What happens if we don’t do a stimulus?”

    it looks to me like it is either taxpayer money of shareholder money, or both. But in this case the losses are so widespread that th taxpayers and shreholders are largely the same group.

    If you do the stimulus you have pain in the long run (borrowing has to be paid back), if you don’t you have pain in the short run (joblessness), and maybe the long run both (slow recovery).

    I don;t see much choice but try something, but we are pretty much in uncharted water here.


  37. Anonymous Avatar

    “Consider pareto-optimality for total tax burden vs income. The average Virginian in 2005 paid 32.9% total tax burden (as opposed to 29.2 in 1975). “

    I don’t understand. I’ll send Bacon my emqil qnd you can send me something on the side.


  38. Anonymous Avatar

    “intervention on behalf of minorities”

    By that I mean nothing to do with race, necessarily, but rather any situation wherein a majority can impose unfair taxation or restraint on a few in favor of the many.

    There is a diffence between intervention on behalf of minorities and protecting minorities (of any kind) from unfair mob rule.


  39. Anonymous Avatar

    “then the economy turns around in less than 24 months. If you cut taxes, all the better and quicker. “

    I’m placing bets on a turnaround this year, as it is. Maybe I’m a little early.


  40. James Atticus Bowden Avatar
    James Atticus Bowden

    RH: Define turnaround. As badly as HH/FDR screwed up and worsened and lengthened the Depression, the economy made some perk ups and eventually turned around.

  41. Anonymous Avatar

    "This recession might linger for years. Our economy will lose 5 million more jobs. Unemployment will approach double digits. Our nation will sink deeper into a crisis that, at some point, we may not be able to reverse," Obama wrote in the newspaper piece.

    Barry says,"You ain't seen nothing yet."

    Yep, uncharted waters. A trillion here, another 3-4 trillion in bank bailouts, more homeowners going down the tubes along with jobs and business. Yet everyone is supposed to hold hands with a messiah that can't even get his advisers to be truthful on their 'tell all' employment application.

    "I screwed up." kinda puts a big dent in that transparency hype you expect the American public to swallow.

    "the economy made some perk ups and eventually turned around."

    Sure did, after we blew up half the planet.

  42. Anonymous Avatar

    I think full employment is costing us trillions.

    Just as there are people who cannot own a home there are people who should not hold a job, such people cost us more than they produce, and we would be better off to pay them to just go fishing.


  43. Anonymous Avatar

    “we would be better off to pay them to just go fishing.”

    Good idea. Wanna meet us down in Bocas del Toro Panama? We can troll a line as we aimlessly sail to nowhere, then finish off the day with some lobster, cerveza and a spirited discussion of what Fundamental Change really means to someone paid to drop out.

  44. James Atticus Bowden Avatar
    James Atticus Bowden

    1. The only uncharted waters is throwning away trillions of public money. This isn’t the first financial bubble. Nothing is magic here unless one knows nothing of the basic body of knowledge for economics. Then, it is,indeed, a dark art and a reason to listen to the Democrat President’s rhetoric.

    2. How much does this non-job job pay?

  45. Anonymous Avatar

    RH: Define turnaround.

    Dow back above 10,000.


  46. Anonymous Avatar

    Surely you know someone with a worthless job, or who is worthless at the job they have.

    Rather than pay a bum $400 to do $200 worth of damage every day, I’d pay him $100 to just stay out of my way.

    Germany, England, and France routinely have 7% unemployment, why do we insist on such abnormally low numbers?

    I don’t have a problem with 10% unemployment: I’d just like MY 10% someday.


  47. Groveton Avatar


    I entered the University of Virginia in 1977 BC (Before Casteen). Those were the good old days when Frank Hereford ran the show. Frank, a former ATO at Virginia, kept a fairly loose hand on the social tiller. That was good. However, he kept a very firm hand on the academic tiller (also good). Evidence of that firm academic hand was Prof. Kenneth Elzinga. Prof. Elzinga was an unrepentant anti Keynsian and devout Christian. He and Finance professor Larry Pettit were the two best teachers I had at dear ole UVA. Both of them kicked my ass every day I was in their class (especially Pettit).

    So, I was lucky – no Keynsian brainwashing back in the day at Virginia. Here is a blurb about Prof. Elzinga:

    And here is Prof. Elzinga's opinion of the stimulus package:

    Not all economists were Keynesians in the 1970s and not all are Keynesians now. For what it's worth, I am not an economist but I play one on BaconsRebellion. And I am most definitely not a devotee of JM Keynes.

    What would I have done?

    1. Inject liquidity into the banks by buying an ownership stake (probably warrants) in the banks. Only banks that divested themselves of everything but fundamental banking infrastructure operations would qualify. This is largely what was done. My only caveat is that I would have replaced the boards of the banks with representatives of the government (to the extent of equity ownership). My overall goal would be to sell the ownership stake back to the public within 5 years. I model this approach on the Chrysler case from the late 1970s / early 1980s.

    2. Purchase the toxic assets from the banks and others. I would put these assets into an RTC like entity and start bundling the assets and selling them to the highest bidder – just like back in the S&L crisis. This would be something of a bailout of the institutions that owned the assets but I'd demand further equity stakes in the institutions based on the book value of the asset vs. what I was paying for it. Again, my goal would be to sell these equity stakes back to the investing public within 5 years.

    3. I would not have provided TARP funds to anybody else. No credit card companies, no car makers, nobody else. Yes – this will hurt. This is the hard part of getting over our fiscal hangover.

    4. Cut all government budgets by 10%. No exceptions, no excuses.

    5. Provide tax cuts to everybody who pays taxes. I would not give rebates to people who do not pay taxes.

    6. No stimulus checks.

    7. Reform the bankruptcy laws to make bankruptcy harder to achieve – perhaps with a grandfather clause for debt incurred to date.

    8. Make workers' councils and collective bargaining mandatory at all medium and large companies (sorry JAB – can't go all conservative here – the "wealth gap" does exist).

    9. Enforce our immigration laws including a revamping of the immigration process to make legal immigration easier and faster. Illegal immigration is not only illegal it is one more cause of the growing "wealth gap". While I believe illegal immigration may be good for the US economy in aggregate it is bad for those lower on the economic ladder. Therefore, I would make the hard decision to turn away many who want to come here, accept a slight negative impact on the economy and refuse to allow rapid growth in illegals working in low paying jobs. This, coupled with the easing of labor organizing and collective bargaining, should let legal American workers in the bottom economic quartile start to realize gains rather than losses.

    And I would pray that we never get into another situation like this since some part of my plan has the stench of Keynesian thinking about it. So, maybe I am recommending one light beer to make this hangover a little easier.

  48. Anonymous Avatar

    Interesting ideas. A few observations.

    You seem to advocate nationalizing some banks. Would these eventually revert back to being private ones?

    On Point Two, you are describing what’s been kicked around as the “Bad Bank” This actually what Paulson said TARP was supposed to do until he actually got his bazooka out of his pocket and changed everything. I am led to believe that Geithner will announce a bad bank next week. Problem is valuing bad debt.

    I’m with you on non-bank bailouts. But I never was a “W” fan.

    Not with you on 10 pecent budget cuts. I do think that spending increases will help in the short term. That’s the only Keynesian part that probaly will have to happen. We’ll have to eat the deficits and the debt.

    If I got a stimulus check, I’d pay down credit card debt which isn’t the point. I have already made my capital expenditure of the year by buying a new home office desktop at Circuit City’s fire sale. Tax cuts OK.

    We do have workers councils. They are called labor unions and the conservatives want to make it harder for them to organize with the checkoff. Lots of right wing outfits would make you think it’s the Bolshevik Revolution such as Media General and the Richmond newspaper, when, in fact, MG makes new employees sign a statement that the firm has a company policy to be ‘union free.” Talk about your yellow dog contract! Workers have a right to organize and having “secret ballots” makes it easier for the bosses to bust organizing. Been there, done that. I was a union negotiator once and have faced Landmark’s union-buster lawyers from Greensboro and Atlanta.
    Don’t see how brown-skinned crab-pickers and lawn maintenance people helped create credit default swaps so I’m not with you on immigration.
    As for my time, I entered Tufts U. outside of Boston in 1970 which was a lively time. They had just gone to a lottery draft and my number was high so Vietnam was not in the cards. Nixon was in the White House and Kent State had happened a few months before. Tufts was a monolithic liberal school. They all were. If we’d protest the war on Commonwealth Ave in Boston, we’d get our heads bashed by those oversized Irish guys who made up the Tactical Police Force (TPF). Having been to a protest or two during high school in DC, I much preferred the more professional DC cops who stuck with more mangeable tear gas.
    Also at Tufts, radicals firebombed the office of the dean of the international relations grad school. He had been a foreign service guy with experience in Vietnam. The blast knocked me out of my bed in a nearby dorm.
    Nothing against UVa, but I gather the time and place were quite different. Can’t imagine these things happening there.

    Peter Galuszka

  49. Groveton Avatar

    I don’t blame illegal immigrants for anything. I just believe that allowing the supply of people with lower level job skills holds the wages of those jobs down. So, American poor make less money with widespread illegal immigration than they would make without widespread illegal immigration. Since I recognize the “wealth gap” as a fact and I oppose broad based welfare I thing limiting illegal immigration is a good idea. It would reduce the supply of workers at the bottom of the pay scale which would put pressure on employers to pay more which would raise the wages of those who need it most. The illegals would certainly lose out under my plan. Unfortunately, I no longer believe that America can be the economic candy store for the world.

    Workers councils exist in many European countries. I see them as better than hugh labor unions because they are smaller, run by people at the employer and are generally more acceptable to big business and their pals in Washington. I would not further limit labor unions or organizing. However, I would like to see an alternative structure to the huge national unions of the past.

    There were no protests at UVA between 1977 – 1981. Of course, the Vietnam War was over, Nixon was gone and Carter was ruining the country as fast as he could. So, everybody was pretty happy. However, a few years earlier there were large anti-war protests including the requisite clashes between students and police. People who were there at the time tell me it was pretty wild although I don’t think there were any firebombings. Which is good since trying to kill people as a means of protesting for peace seems … well, stupid. Unfortunately, lessons never seem to be learned. about two years ago a guy who graduated a bit after me at Groveton was killed in Iraq. He was career Army and a true patriot. If Fairfax County had any balls (which they don’t) they would rename West Potomac High School (formerly Groveton) after him.

  50. Anonymous Avatar

    Shame — one of things that tends to keep us as people in line is shame — and its been largely missing from society for some time. Let’s start putting shame back and at a high level.

    I agree with Obama’s proposal to limit pay for companies taking TARP money. But I’d go farther — limit any corporate officer to SES pay and everyone else to the GS schedule. And then require on all company letterhead, responses to customers, etc. “This company is being subsidized by taxpayers.” These restrictions, which would recreate some sense of shame, would stay until Uncle Sam has been repaid in full. I think that even the most egotistic of us would learn a bit of humility with pay limits and a “scarlet letterhead.” We see better behavior and earlier payoff of the debt. Can you imagine responding to a potential customer’s RFP on Scarlet Letterhead?

    Congress needs to put itself under all the restrictions that it puts on everyone else. Lobbying government is an important First Amendment Right, but it needs to be exercised in the open. Absent true national security matters, there should be an Internet-traceable record of every contact made by anyone who is being compensated for his/her time and effort with any member of Congress and his/her staff members.

    While I’m generally a free-market person, we need more regulation of the financial services industry. And we need to move back to a situation where people make money by providing useful goods and services and not by manipulating and plain gambling. Destroying someone’s retirement funds by short-term flipping and betting is not in the public interest. Tax any gains on capital held less than six months at 90% — the states can do the rest. Limit the deductibility of those short term losses to 50%. We need longer-term investment. That is more important than ensuring liquidity for every investment.

    Regulate commodities trading and use the tax code to nail those who would move the trades overseas. That’s how the feds got Capone.

    I’m not on board with labor unions. Unions exist for themselves and not for workers. As a college student in a closed shop state, I found all of my first paychecks coming back to work after the annual post-inventory layoffs going to taxes and union dues. That was wrong and hurt a lot of us who needed the money. Unions could use a bit of shame too.


  51. Anonymous Avatar

    “Unions exist for themselves and not for workers. “

    Pretty much how I feel about political parties: they exist for themselves more than for their members.


  52. Anonymous Avatar

    Groveton’s comments on illegal immigration make sense. We need to move beyond demonizing these people, most of whom are decent and hardworking, but we cannot operate as a safety valve for the rest of the world’s problems and as a source of unfair competition for those Americans and lawful immigrants without high skills. Moreover, the country cannot afford to pay the costs needed to support all of these people and their families.

    Isn’t it about time that we move beyond the desires of many Republicans for dirt-cheap labor and the desire of many Democrats for new voters dependent on high government spending and taxes?

    Make E-Verify mandatory; its use a complete defense to any charges of illegal hiring; and its non-use a private cause of action for any taxpayer to sue. The plaintiffs’ bar alone could enforce our immigration laws against unscrupulous employees.

    Once the border is secure, let’s talk about addressing those who want to move here and those who already did. As a test for when the borders are to be deemed secure, it’s when wages for the lowest quartile of working people rise as fast as compensation for the top 2% for three years in a row. Or are we just kidding about concern over the wage gap.


  53. James Atticus Bowden Avatar
    James Atticus Bowden

    This thread is getting long. I’ll address the wealth gap in another posting.

  54. Anonymous Avatar

    Clusterf#@k to the Poor House – Economic Recovery Plan

    Republicans debate the stimulus bill, forgetting that C-SPAN doesn’t destroy old tapes when a new administration steps in.

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