Friday, July 29, 2011

In case you missed it: Fox 25 Undercover on $42M in state pay raises

This is well worth a watch.

Since one of Charlie Baker's signature campaign promises last year was to impose an across-the-board state government salary and hiring freeze until the state gets its budget in order, I think I'm going to go ahead and include this one in my "Elections Have Consequences" series...

Making a profit? Outrageous!

Headline: Boston Scientific to lay off 1,200-plus.

Add 'em to the list

To be fair, only about 2,000 of the company's 25,000 employees are based here in Massachusetts, and the company has not yet said how many of the "1,200 plus" layoffs will hit here at home (Boston Scientific's HQ is in Natick).  Could be none of them.  But it will hardly be surprising if the impact is felt locally.

That uncertainty hasn't kept one of the state Senate's leading liberals from sounding off.  From the Globe:
“I’ve asked for information on where they are cutting jobs,’’ said state Senator James B. Eldridge, an Acton Democrat. He has proposed so-called clawback legislation that would allow the state to recover money from businesses that receive tax breaks here - including Boston Scientific - and then reduce their workforces.

“My sense is, sadly, that like many other American companies, they are shedding jobs in Massachusetts and adding jobs overseas,’’ Eldridge said. “And this is a company making greater profits, so it’s even more outrageous.’’
Yes.  Outrageous (Senator Eldridge forgot egregious! and preposterous!)!

So why is this company that is "making greater profits" also cutting back its domestic workforce?  Why d'ya think?  Cost.  More Globe:
Yesterday’s move, a day after Boston Scientific disclosed it was investing $150 million and hiring 1,000 people in China, raised fears that the company will gradually shift more work to foreign sites with less government oversight and lower costs than the United States.
Outrageous indeed that a for-profit enterprise should seek to minimize costs, increase efficiency and thereby achieve even greater profits.  Appalling.  Of course one Senator's outrage is another man's fiduciary obligation to his shareholders... but whatever.  Now I'm speaking a tongue foreign to Beacon Hill.

Beyond the outrage, there is no small irony in the Senator's proposed substantive response.  Yes, Boston Scientific has received Massachusetts tax breaks.  According to the same Globe article, the company has met its obligations in connection with those breaks. "As of the last state audit, the company was in compliance with the terms of those deals, said a spokeswoman for the Executive Office of Housing and Economic Development."

No matter.  The Senator's proposed legislation would allow the Commonwealth to reach back and punish companies for making wholly rational business decision, no matter the terms of their specific agreements with the state... thereby adding yet another disincentive to doing business in Massachusetts.

In the words of the immortal Kramer, that's "definitely preposterous!"

Meanwhile, another home-grown Massachusetts company whose commitment to its US workforce is maintained at considerable cost is getting no love in return from the Obama Administration... 

Top 10 Reads of the Week – July 29, 2011

A gunrunning sting gone fatally wrong – Sari Horowitz [Washington Post]

They came from all over the country, agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives, brought here in a bold new effort to shut down the flow of U.S. guns to Mexican drug cartels. It was called Operation Fast and Furious, after a popular movie about street car racing.

But from the beginning, much of the fury was inside the agency itself.

On his first day undercover, John Dodson, who had been an ATF agent for seven years in Virginia, sat in a Chevy Impala with Olindo Casa, an 18-year veteran from Chicago. They watched a suspected gun trafficker buy 10 semiautomatic rifles from a Phoenix gun store and followed him to the house of another suspected trafficker. All of their training told them to seize the guns.

The agents called their superior and asked for the order to “take him.” The answer came back swiftly, instructing them to stay in the car. The message was clear: Let the guns go… Read the Rest

Planless Dems – Mark Steyn [National Review Online]

Earlier this month, Moody’s downgraded Irish government debt to junk. Which left the Irish somewhat peeved. The Department of Finance pointed out that it had met all the “quantitative fiscal targets” imposed by the European Union, and the National Treasury Management Agency said that Ireland was sufficiently flush “to cover all its financing requirements until the end of 2013.”

Which is more than the government of the United States can say… Read the Rest

If a law doesn’t work, waive it away? – John E. Sununu [Boston Globe]

AT ONE point during recent debt negotiations, President Obama laid down a list of “untouchable” budget items. Topping that list was anything having to do with implementing or enforcing the Health Care Reform Act. Ironically, the hard line came only after the Department of Health and Human Services regulators had issued waivers exempting 1,400 companies from the harsh effects of ObamaCare.

Everyone knows that regulators write the rules. But the real power comes with the power to tell states, industries, or, as in this case, individual companies that they don’t have to comply… Read the Rest

Congress stands its ground – George Will [Washington Post]

Between 6 p.m. Friday and 4 p.m. Sunday, the nation began a constitutional course-correction. The current occupant’s vanity and naivete — a dangerous amalgam — are causing the modern presidency to buckle beneath the weight of its pretenses. And Congress is reasserting its responsibilities.

At his Friday news conference-cum-tantrum, Barack Obama imperiously summoned congressional leaders to his presence: “I’ve told” them “I want them here at 11 a.m.” By Saturday, his administration seemed to be cultivating chaos by suddenly postulating a new deadline: The debt-ceiling impasse must end before Asian markets opened Sunday evening Eastern time, lest the heavens fall… Read the Rest

Was the $5 Billion Worth It? – Jason L. Riley [Wall Street Journal]

'It's hard to improve public education—that's clear. As Warren Buffett would say, if you're picking stocks, you wouldn't pick this one." Ten years into his record-breaking philanthropic push for school reform, Bill Gates is sober—and willing to admit some missteps.

"It's been about a decade of learning," says the Microsoft co-founder whose Bill and Melinda Gates Foundation is now the nation's richest charity. Its $34 billion in assets is more than the next three largest foundations (Ford, Getty and Robert Wood Johnson) combined, and in 2009 it handed out $3 billion, or $2 billion more than any other donor. Since 2000, the foundation has poured some $5 billion into education grants and scholarships… Read the Rest

The Latest Job Killer From the EPA – John Engler [Wall Street Journal]

President Obama won praise from businesses in January when he promised to bring "reason and balance" to a "21st-century regulatory system." Yet now, fewer than six months later, his administration is preparing to issue the single most expensive environmental regulation in U.S. history, a job-killing rule it is under no obligation to impose on the struggling economy.

There's nothing reasonable or balanced about the Environmental Protection Agency's proposal to tighten national air-quality standards for ozone emissions at this time. For one thing, it's premature, coming a full two years before the EPA is scheduled to complete its own scientific study of ozone emissions in 2013… Read the Rest

S&P, Moody’s U.S. Downgrade Irrelevant – Jack Hough [WSJ Smart Money Blog]

To hear politicians, the fate of modern finance is now being decided by perhaps a dozen Manhattan bond geeks. Their job at Standard & Poor's and Moody's is to paste letter grades on governments so bond buyers can decide which are good for the money. Even America's president fears them. "A six-month extension of the debt ceiling might not be enough to avoid a credit downgrade," he warned the nation in an address Monday night, having already listed some of the consequences: "Interest rates would skyrocket on credit cards, on mortgages and on car loans."… Read the Rest

Watch of the Week

National Standards and Tests: An Unprecedented Federal Overreach [Heritage Foundation/Pioneer Institute]

The Truth about Obama’s Budget Deficits, in Pictures – Mike Brownfield and Emily Goff [The Foundry]

Through the fog of the debt limit negotiations, President Obama has attempted to shift the blame for America’s deficit crisis to politicians at large, claiming that “neither party is blameless for the decisions that led to this problem.” Though the culture of overspending is endemic in Washington, don’t let the President fool you—some are a lot more guilty than others.

The fact is that Obama’s budget would set America on a dangerous fiscal course that leads to massive deficits well into the future—hitting $1.2 trillion in 2012 and, after dipping slightly, rising back to $1.2 trillion again by 2021… Read the Rest

They’ve Lost That Lovin’ Feeling – Peggy Noonan [Wall Street Journal]

The Republican establishment reasserted itself this week, and good thing, too, because the establishment was right. It said Republicans in the House should back and pass the Boehner bill on the debt ceiling because it goes in the right directions, contains spending cuts but not taxes, and is viable. So accept victory, avert crisis, and get it to the Senate.

The establishment was being conservative in the Burkean sense: acknowledges reality, respect it, and make the most progress possible within it. This has not always been true of them. They spent the first decade of this century backing things a truly conservative party would not have dreamed of—careless wars, huge spending and, most scandalously, a dreamy and unconservative assumption that it would all work out because life is sweet and the best thing always happens. They were mostly led by men and women who had never been foreclosed on and who assumed good luck, especially unearned good luck, would continue. They were fools, and they lost control of their party when the tea party rose up, rebuking and embarrassing them. Then the tea party saved them by not going third party in 2009-10. And now the establishment has come forward to save the tea party, by inching it away from the cliff and reminding it the true battles are in 2012, and after. Let's hope the tea party takes the opportunity… Read the Rest

Is the President in Recovery? – Victor Davis Hanson [National Review Online]

President Obama does not care much about deficits — other than worrying that big debt might matter in his reelection campaign.

In his first three budgets combined, Obama borrowed nearly $5 trillion. Currently, the government is borrowing about 45 percent of everything that it spends. The 2012 budget that Obama proposed in February would add nearly $10 trillion to existing U.S. debt over the next ten years. It would spend $3.7 trillion in 2012 and result in the largest annual deficit in U.S. peacetime history, which is why it was rejected in the Senate by a 97–0 vote… Read the Rest

The Funniest Thing I Saw This Week

Nation's Climatologists Exhibiting Strange Behavior (Season 1: Ep 5 on IFC)

The Un-funniest Thing I Saw This Week

A visualization of United States debt - []

$15,000,000,000,000- Unless the U.S. government fixes the budget, US national debt (credit card bill) will topple 15 trillion by Christmas 2011.
Statue of Liberty seems rather worried as United States national debt passes 20% of the entire world's combined GDP (Gross Domestic Product).
In 2011 the National Debt will exceed 100% of GDP, and venture into the 100%+ debt-to-GDP ratio that the European PIIGS have (bankrupting nations)… Read the Rest

[$15 trillion, in pallets of $100 bills…]

Wednesday, July 27, 2011

Pols preen in green... and we pay

Last week the Patrick/Murray Administration announced plans to fund installation of 142 electric vehicle charging stations around the Commonwealth.  Marsha Traber of Lexington, for one, is "totally excited."  She owns an electric scooter, you see, which she'd like to use to "tool around the Lexington area," but to-date she has been limited in her tooling due to her vehicle's "short range."

The other 99.999999999% of the population - those of us who neither own nor wish to own electric vehicles unless/until the associated technology and cost catch up with politicians' lofty aspirations - can be forgiven for wondering if this roll-out is the very best use of funds at a time when government at all levels is supposedly cutting "to the bone."

My intellectual betters in the government point out that there is a "chicken and egg" problem faced by proponents of electric vehicles.  Specifically, people won't buy EVs - with their short per charge range - if there aren't widely-available places to plug in.  Says state assistant transportation secretary Maeve Bartlett, “We want to have a public investment so that once these vehicles come on the market, it’s going to be easy for people to find a charging station - it’s not going to be an impossibility... We want a rollout of electric vehicles to be successful, and publicly available charging stations can enable that.’’  Those aspirations again.  Why wait for technological innovation to create a natural market incentive when spending taxpayer dollars to force the issue is so much quicker? Certainly EV manufacturers must appreciate the state's largesse.

Runs on premium taxpayer dollars
So about those dollars.  According to the Globe, each charging station will cost approximately $5,500 to install.  Of course that is a government estimate.  Applying the standard government inefficiency multiplier to the estimate yields a final cost per unit of approximately $1,237,654.47.  But let's stick with the initial estimate of $5,500 for kicks.  That's a total cost of $781,000.  Readers of this blog might remember that back in April the Herald reported that Boston was spending around a million bucks on nineteen road signs, so the notion that government is going to bring in the installation of seven times as many vehicle charging stations for $780K strains credulity to say the least, but suspend disbelief and stick with me.

The Patrick/Murray Administration says the stations will be paid for in part by using "a $280,000 settlement in a pollution case that Attorney General Martha Coakley’s office obtained in 2007."  Found money!  And lord knows we could never come up with another, more productive use for $300K. So far, so good.  The balance will be paid by "ChargePoint Network, run by California-based station maker Coulomb Technologies Inc."  When I first read that part I was relieved.  If the bulk of the project cost is to be paid by the company that makes these charging stations, then great.  A private sector company investing in the infrastructure necessary to grow its market.  But then I read further.  It seems the ChargePoint Network is funded by - guess what! - federal "stimulus dollars."  So more taxpayer dollars, pulled from a different pocket.

All of this is part of the Patrick/Murray Administration's "Preen Initiative" - er, I mean "Green Initiative" - the animating principle of which seems to be that any expenditure of public funds, no matter how impractical or implausible the stated goal, is justified so long as that goal can be plausibly labeled "green." The pols feel good, some idealistic college students feel good.  One just can't put a price tag on that much feelin' good.

In this case, we taxpayers are going to foot the bill to install roughly a dozen electric vehicle charging stations for each of the Commonwealth's electric vehicle owners.

Okay, I made that up.  But given that a whopping 1,745 units of the much-ballyhooed Chevy Volt have been sold this year - anywhere - it seems safe to guess that waiting on line won't be a problem at any of our 142 new charging stations any time soon.

Ah, but again I am forgetting the "chicken and egg" problem!  "[I]f individuals are to be comfortable purchasing electric vehicles, they must also be assured that there are available charging stations for these vehicles," opines Hank Manz, chairman of the Lexington Board of Selectmen (Lexington is getting charging stations). 

But is that really it?  Is the relative lack of charging stations really what has the few EVs available on the market selling like moldy fruit? 

Buried in the middle of the Globe article linked above is this telling factoid: "The new Chevrolet Volt takes four to five hours to fully charge at these stations and has a 40-mile range."  So we're not talking about a gas station type transaction here.  What, exactly, do proponents of this undertaking expect EV drivers to do?  Pull up to the charging station and take a five hour nap?  Enjoy a seven course meal?  Maybe read a book?  A whole book? 

Support the Preen Initiative
 The going price for a Volt, by the way, is $41,000.  After a $7,500 taxpayer subsidy each of the car's proud 1,745 drivers is out $33,500 for a car that costs the same as an entry level BMW or Lexus, but is appointed roughly like a stripped down Festiva. 

So while the relative lack of available charging stations might contribute marginally to the market's apparent rejection of EVs, there are significant other disincentives in play.  Like the fact that the current state of EV technology makes the cars wholly impractical for all but a tiny niche of drivers.  Or the fact that the cost remains out of range for most people, even with generous government subsidies, for a product that by any measure save for fuel economy cannot hope to match up to its competitors.

Which brings me back to an earlier point.  Right now, every single automaker in the world is working feverishly to overcome each of those obstacles.  They will, maybe soon.  When they do, they can and should be expected to put their money into establishing the infrastructure - like charging stations - necessary to support their products.  By dumping a bunch of public money into the effort now, the Patrick/Murray Administration is trying to push understandably resistant consumers out in front of the technology, and doing so at a time when the public funding well is supposedly bone dry.

It's enough to make a taxpayer feel a different kind of green.

Tuesday, July 26, 2011

How to solve the debt ceiling crisis in just ten minutes and one second

All that is needed is a way to force 51% of the voters - regardless of party - to watch this clip of the President's spokesman sparring with the press over the President's refusal to produce a debt reduction plan of his own.  Game over.

One major hurdle: it's really hard to watch.  Human beings are naturally empathetic, for one thing, and it is difficult to watch another human being squirming on the hook for what seems like a very long time.  For another, we have an instinctive aversion to petulant condescension.  Anyhow, watch and circulate.

Some observations about the exchange here.

Oh, and then there's this.

Monday, July 25, 2011

Making a list

A small businessman opens his paper and reads the latest news of job cuts in Massachusetts.  His brow furrows.  This is too familiar.  Too constant.  This businessman isn't particularly political. He has other things to worry about than the day-to-day on Beacon Hill.  Like running his business.  Oh, he pays attention and he votes.  The guy he voted for in 2010 lost.  The guy who won, he recalls, devoted a lot of oxygen to endless repetition of a mantra that assured us that on his watch and under his stewardship, things were getting better. Mending. Moving.

Does that seem right?  Is that how things are playing out?  This small businessman feels like maybe it isn't.  He spends some time jotting down a list, and he sends it to a friend, who sends it to a friend, who sends it to me.  Here it is:
Job cuts in MA since the 2010 election:
  • State street – 558 in MA
  • Flextronics – 250 in MA
  • Hasbro - 145 in MA (moving 70 of those to RI…rest layoffs)
  • Genzyme Genetics – 169 in MA (shifting part of work to NC)
  • Fidelity – 1100 jobs in MA (moving to NH and RI)…in 2006 had 13k MA employees, currently 8400 MA ee’s, soon to be 7300
  • CSC – 146 in MA
  • US Foodservice – 153 in MA (MA plant was not “economically viable”)
  • Unilever – 178 in MA
  • Courier – 110 in MA
  • Evergreen Solar – 800 in MA
  • BJ’s Wholesale – 114 in MA
  • AJ Wright – 800 in MA
  • Charles River Labs – 300 in MA
  • Biogen – 86 in MA
  • Genzyme – 185 in MA
  • NSTAR – 350 in MA (planned over next 5 years)
  • National Grid - TBD
That's an ugly list, and it isn't complete.  There's also Raytheon - 288 (almost immediately post-election), Baystate Health - 354...  I know I'm missing some too.  Drop a comment if I am. 

Of course that list only includes the big names.  The shuttered travel agency or diner or newsstand in your hometown isn't on that list.  The newly vacant greenhouse standing next to Quincy Market that I noticed this morning - the one that has housed a florist for as long as I can recall - isn't on that list.  How many others?  And how many of those closed here, only to open elsewhere?

Governor Patrick doesn't say "on the mend and on the move" much any more, creating a rhetorical void that is all the more striking for the voter-numbing ubiquity of the phrase last year. 

There are the monthly job figures of course.  When they are up, we get a press release, a Governor at the podium, etc.  When they are down, we get silence.  No matter.  Those figures are marginally useful as such things go, but they are always revised, often significantly.  All politicians and pundits - both parties - use those numbers when they are useful and ignore them when they aren't. 

This list... that's another thing entirely.  Those numbers aren't averages or estimates.  They are lost jobs.  They are unemployed people.  The names on the list are by and large recognizable.  Job cuts at State Street, or Raytheon, or NSTAR, or Genzyme, or the others?  That's news.  That makes an impression.  Not a good one. 

That kind of news says to the small businessman with his newspaper on his couch, "Something is wrong here."  It says to major corporations pondering a move into Massachusetts, "Something is wrong there."  It says to kids about to graduate from college, pondering where to dive into an ultra-tight job market, "Something is wrong here."  That impacts investment, hiring, expansion; none of these in a positive way.

Meanwhile, on Beacon Hill lawmakers are again considering a law that would force online retailers to collect Massachusetts tax on items purchased by Massachusetts consumers.  Jerry Brown's California recently did that.  Here's what's happening as a result: is spearheading a referendum to nullify the law by collecting 500,000 signatures and putting the issue before voters in a referendum next June. But until then, thousands of businesses across the state are shut out from doing business with and other online retailers.

“We just want it to stop,” said Thomas Swalla of the termination notices streaming in. Swalla is chief operating officer of Los Angeles-based, an online portal business that aggregates deals by merchants. The company has 4,500 affiliate-like relationships with online merchants, but since the law was signed, 300 have sent the company termination notices, costing the company up to an estimated 25 percent in business, according to Swalla.

The 100-employee company is now considering moving operations to Arizona or Nevada. “I am going to go ahead and prepare for the worst, hope for the best,” said Swalla.
New Hampshire already pays people to convince Massachusetts businesses to move north.  Doubtless they are hoping Beacon Hill will make their job even easier than it already is. 

Recently a Republican state Rep posted at Red Mass Group about the online sales tax proposal, asking "is it a new tax, or isn't it?"  I wanted to weep.  I can (and do) hope that the Representative was gathering ammunition to deploy against the proposal.  He's good on this stuff.  But whether or not an internet sales tax would be "new" isn't the point.  The list above is the point.  An internet sales tax would cause it to grow longer.  Elected officials - all of them - ought to be doing everything possible to achieve the opposite effect.

Friday, July 22, 2011

Top 10 Reads of the Week – July 22, 2011

Home Depot Co-Founder : Obama is Choking Recovery – John Merline [Investor’s Business Daily]

Bernie Marcus co-founded Home Depot (HD) in 1978 and brought it public in 1981 as the U.S. was suffering from the worst recession and unemployment in 40 years. The company thrived, creating hundreds of thousands of jobs and redefining home improvement retailing.

But Marcus says Home Depot "would never have succeeded" if it launched today due to onerous regulation. He recently helped launch the Job Creators Alliance, a Dallas-based nonprofit of CEOs and entrepreneurs dedicated to preserving the free enterprise system. IBD recently spoke to him about jobs and the economy… Read the Rest

A Brief History of President Obama’s Fiscal Record – House Budget Committee []

January 20, 2009
President Obama sworn into office

  • President tells the American people in his Inaugural Address: “Those of us who manage the public's dollars will be held to account, to spend wisely, reform bad habits, and do our business in the light of day, because only then can we restore the vital trust between a people and their government.”

    Debt Held By Public = $6.31 trillionRead the Rest

Nantucket’s Wind Power Rip-Off – Robert F. Kennedy, Jr. [Wall Street Journal]

Someone needs to tell the politicians in Boston and Washington that Cape Wind, the long-stalled plan to cover 25 square miles of pristine Nantucket Sound with 130 massive steel windmill-turbine towers, is a rip-off. That someone is most likely to be the newly enlightened electricity ratepayers—and voters—of Massachusetts.

In the past few months it has become clearer than ever how much this giveaway of public property is going to cost them if Cape Wind is ever built. The numbers are staggering… Read the Rest

The Ideologue in the Oval Office – Jonah Goldberg [National Review Online]

‘I think increasingly the American people are going to say to themselves, ‘You know what? If a party or a politician is constantly taking the position my-way-or-the-highway, constantly being locked into ideologically rigid positions, that we’re going to remember at the polls,’” President Obama said at his Friday news conference.

I know everyone is sick of hearing about the debt-limit negotiations. Lord knows I am. When I turn on the news these days, I feel like one of the passengers seated next to Robert Hays in the movie Airplane! By the time we get to the phrase “in the out years,” I’m ready to pour a can of gasoline over my head.

Still, regardless of how things turn out with the negotiations, what we are witnessing is the rollout of the Obama reelection campaign’s theme: Obama is the pragmatic voice of reason holding the ideologues at bay… Read the Rest

Can a Playground Be Too Safe? – John Tierney [New York Times']

Ed. Note: Yes.

When seesaws and tall slides and other perils were disappearing from New York’s playgrounds, Henry Stern drew a line in the sandbox. As the city’s parks commissioner in the 1990s, he issued an edict concerning the 10-foot-high jungle gym near his childhood home in northern Manhattan.

“I grew up on the monkey bars in Fort Tryon Park, and I never forgot how good it felt to get to the top of them,” Mr. Stern said. “I didn’t want to see that playground bowdlerized. I said that as long as I was parks commissioner, those monkey bars were going to stay.”.. Read the Rest

The House shines – Editorial [New York Post]

Four years after Congress foolishly decreed the demise of the well-loved incandescent bulb, House Republicans are making amends.

And passing amendments… Read the Rest

Staying Alive – Noemie Emery [Weekly Standard]

[Ed. Note: I understand and share the natural resistance that arises in some of us to reading the book that everyone says to read.  But Unbroken really is worth your time.  Great read/inspiring tale.  Teaser here.]

Around two in the afternoon of May 27, 1943, an American bomber, a B-24 Liberator Green Hornet, went down in the Pacific between Hawaii and Palmyra Atoll on a search mission for a pilot feared lost. Three of the six-man crew would die upon impact. The three who survived—Phil (Allen Phillips), the pilot; Louie Zamperini, an American runner who had been one of the stars of the 1936 Berlin Olympics; and the tail-gunner, Mac (Francis McNamara)—found themselves dazed, traumatized, and adrift in the ocean miles from any kind of island, with two rafts, no water, no form of shelter, and almost no food.

Thus began for Phillips and Zamperini two years and 10 months of inhuman torture, at the hands of both nature and man. For 47 days the two men would drift for thousands of miles, driven nearly insane by thirst and starvation, burned by the sun, chilled by the night, eaten by insects, poured on by storms, and forced to fight off, with sticks and fists, the schools of sharks that surrounded them, circled them, and sometimes launched themselves into their raft. Now and then Japanese planes would pass overhead and strafe them with bullets. (When American search planes had failed to locate them, the Army Air Corps assumed they were dead.)… Read the Rest (and then Read the Book)

The Obama Doctrine Defined – Douglas Feith & Seth Cropsey [Commentary]

The words “vacillating” and “aimless” are commonly used by both left and right to describe President Barack Obama’s approach to the Libya war. His political friends and foes alike lament that he has no clear goal in Libya—and that, by failing to articulate one, he is revealing his unease at having been dragged into the fight to oust the regime of Muammar Qaddafi .

Democratic Senator James Webb of Virginia issued a press release on March 21, 2011, noting that the U.S. mission in Libya “lacks clarity.” Former Republican Senator Slade Gorton wrote in the Washington Post: “We should never enter a war halfway and with an indecisive goal. Regrettably, that is where we stand today.”

The criticism has some validity, but it misses an important point: the administration’s approach has logic and coherence in the service of strategic considerations that extend far beyond Libya… Read the Rest

Tea Party would defeat Obama by supporting McConnell plan on debt – George Will [Jewish World Review]

The Tea Party, the most welcome political development since the Goldwater insurgency in 1964, lacks only the patience necessary when America lacks the consensus required to propel fundamental change through our constitutional system of checks and balances. If Washington's trajectory could be turned as quickly as Tea Partyers wish — while conservatives control only one-half of one of the two political branches — their movement would not be as necessary as it is. Fortunately, not much patience is required.

The Goldwater impulse took 16 years to reach fruition in the election of Ronald Reagan. The Tea Party can succeed in 16 months by helping elect a president who will not veto necessary reforms. To achieve that, however, Tea Partyers must not help the incumbent achieve his objectives in the debt-ceiling dispute… Read the Rest

Two Dates Prez Should Take To Heart – But Won’t – Steve Forbes []

Two extraordinary anniversaries are coming up this summer that have enormous relevance to events today.

Forty years ago President Richard Nixon blew up the post-World War II international monetary system that had played a crucial part in the rapid recovery of Europe and Japan, as well as in the U.S.' impressive prosperity. The recent catastrophic subprime housing bubble and the sovereign debt crises in Europe and elsewhere, as well as our own fiscal mess and sluggish economy, can all be traced back to what we did on Aug. 15, 1971… Read the Rest

The Funniest Thing I Saw This Week

Artists Announce They’ve Found All The Beauty They Can in Urban Decay [The Onion]

DETROIT—After spending more than a century exploiting urban decay to create deeply moving, socially conscious works of art, the art world announced Tuesday that it had captured all the beauty it was going to find in rusted-out cars, abandoned houses, and condemned industrial sites. "These modern ruins speak to the very heart of the human condition, but at this point every last inch of Detroit and Oakland has been documented in photographs, on film, or as part of a multimedia installation," said artist Devon Gerhart, who told reporters that devoting so much time to contemplating the wounded grandeur of blighted cityscapes had led him to the point where he just wanted to see the places cleaned up. "I made my career portraying the plight of the homeless, but now I'm starting to wonder whether they'd prefer it if someone just helped them find a place to live." The world's artists later confirmed plans to spend at least another 50 years churning out heavy-handed depictions of the inherent soullessness of suburban sprawl.

Thursday, July 21, 2011

What did Tim Murray do to deserve being pushed out in front of a gas tax hike?

First an aside. When did "revenue" replace "tax" in the every day vernacular?  Without knowing for sure, I feel like it started only a few years back.  First it was a sly evasion, almost a euphemism.  "We need to look at revenues" became a cautious way for a politician - Governor Patrick and President Obama come to mind - to broach the subject of new taxes without saying the word "taxes."  Over a short time, though, "revenue" has eclipsed "tax" in common usage, both in DC and on Beacon Hill.

It sounds so benign.  And "no new revenues!" sounds so irrational.  Anti-growth even.  Which of course is part of the reason behind this rhetorical substitution.

Anyhow, what brings this to mind currently is the discussion going on in the Patrick Administration about a whole slew of new taxes and fees associated with how we get from place to place.

Here are a fun handful of excerpts from a recent State House News article titled "State panel trying to steer transportation debate toward revenues":

With hundreds of millions of dollars in federal aid potentially on the chopping block and an aging transportation infrastructure prone to breakdowns, a commission tasked with evaluating the state's transportation system strategized Monday about the best way to build support for new revenue within the Legislature and among the public.

"I feel like a patient that's been wheeled into the emergency room. We're all doctors, and we're trying to figure out a prognosis while the patient is bleeding," said Timothy Brennan, executive director of the Pioneer Valley Planning Commission. "My fear is that we won't move fast enough."

To support the system, he said, "We have got reach into our wallet, no matter how painful that may be, and invest in ourselves."...

Other members of the Transportation Advisory Committee - a 28-member group appointed by Transportation Secretary Jeffrey Mullan - warned of dire consequences if federal transportation cuts go through and wondered about the best way to build a drumbeat of support for new sources of transportation funding... at Monday's 90-minute meeting, the group largely focused on the best ways to gather support for new revenue, and no one spoke against the idea...

Alan Macdonald, who chairs the committee, described as "good news" a recent editorial in support of an increase in the state's gas tax.

Secretary Mullan said he intends to press lawmakers about the type of transportation system they'd like in their region. "For the system we currently have and for the system we want to have, reform may not be enough," he said.

Having read all that, you may be surprised to read that after the meeting where all of the above was discussed, soon-to-be-former Secretary Mullan had this to say to assembled reporters:
After the committee meeting, Mullan told reporters that he wasn't endorsing new revenue but suggested that without it, policymakers will need to brace for fundamental changes to the transportation system.

"We can't continue to run structural deficits at MassDOT and the MBTA year after year," he said. "If that leads to a conversation about revenue, I guess that's inevitable. But that's not the conversation we've called for."
"We have got to reach in our wallet... and invest in ourselves."  An editorial supporting a gas tax hike is "good news."  "Reform may not be enough."  That's an awful lot of talk about "revenue" for a conversation that the Secretary claims is not happening.

So what kind of "revenues" are being discussed in this supposed non-conversation?  More SHNS:
An April report from A Better City identified a slew of potential revenue sources to help close the estimated $20 billion maintenance gap in the state transportation system - although researchers argued that the gap had likely widened since those estimates were offered. Among the revenue options offered in the report: additional motor fuel taxes, personal property tax on motor vehicles, a fee for vehicle miles traveled by drivers, emission fees, parking taxes, property taxes, the personal income tax, payroll taxes, carbon taxes, development impact fees and a local option sales tax.
Phew. That's an awful lot of "revenue."  But fear not.  ABC's list is likely being floated out in its entirety now so that when the Patrick Administration settles into its pitch for the "revenue" it really wants, it appears mild by comparison.  And as anyone who has paid attention to Massachusetts politics over the past five plus years well knows, the Patrick Administration has always been a big fan of one particular transportation-related "revenue" source: a gas tax hike.

Over the course of two (successful) statewide campaigns for Governor, Patrick steadfastly insisted that he had "no plans to raise taxes."  But the Governor's fondness for a gas tax hike is well known.  That's the beauty of the "no plans" formulation; it is absolutely true, right up to the moment when it is not.  He gave the hike a shot in 2009, and even used the failed attempt as a selling point to his base last year. 

Now he is going to give it a try again.  Here's the Worcester T&G:

Lt. Gov. Timothy P. Murray, citing the growing cost of maintaining the state’s transportation infrastructure, said today the administration may soon be seeking an increase in the gas tax.

Reports indicate that the state’s transportation needs appear to be growing faster than the state can afford to repair and update its infrastructure. Mr. Murray said a discussion about raising revenues for transportation needs is coming in the next year or two.

“I think there are still a few items left on the ‘reform before revenue’ punch list, but I do think we are getting close (to needing to look for new revenues for transportation),” he said.

“I think we need to look at some type of revenue, dedicated in some manner or form, in the next year or two to meet the needs of our transportation system,” Mr. Murray said.

“It could be a combination of things” that might include a gas tax hike, he said.

Additional revenue could come in the form of higher tolls, fares or taxes, he said. Mr. Murray said he doesn't wan to see tolls and fares go up.
A few things about that.

First, what did poor Tim Murray do to deserve being marched out in front of a tax hike just a couple of years before he runs for the big chair?

One of those "transportation needs" contributing to the growing cost of transportation in the Bay State is the costly South Coast Commuter Rail expansion that Patrick and Murray continue to promise, with no hint of a way to pay the associated $1.4 billion cost.  That's a choice, and maybe a desirable one.  But it isn't a "need."

And about this "reform before revenue punch list" of the LG's.  Can we see it?  Secretary Mullan's predecessor in 2009 infamously called the "reform before revenue" mantra a "meaningless slogan," a characterization that was essentially verified later that year when the legislature passed a 25% increase to the state sales tax, promising that a significant chunk of the new tax - er, revenue - would be dedicated to transportation.  But anyhow, what's on that punch list?  More importantly, what is punched on that punch list?

Yes, they eliminated the Turnpike authority and wrapped the Pike and Mass Highway into one big agency.  And yes, that was a good step.  Unfortunately, the Governor and his underlings view the substantive consolidation, elimination of redundant positions, etc. that could have/should have  accompanied that agency roll-up as 'union-busting,' and so a good deal of the savings promised in association with their ballyhooed "transportation reform" have not materialized.  Hence, the need so soon for yet another "conversation" about "revenue."  Poor LG Murray is like the guy on the deck of a sinking ship.  "Why man the life boats?  We've just finished arranging the deck chairs!"

Liberals love to point out that a not-inconsiderable number of respected conservatives have at various times come out in favor of a gas tax increase.  Charles Krauthammer is probably the most prominent.  And while it is not unfair to hold him up as a legitimate, respected, conservative advocate for an increase in the (federal) gas tax, it must be remembered that there is context to his advocacy.  Specifically, Krauthammer proposes what he calls a "net-zero" gas tax increase; meaning the increase would be off-set by a reduction in taxes elsewhere, leaving a "net zero" increase in government revenue.  Posed that way, the increase would be a clever way to force re-prioritization of government revenue toward what all agree is an urgent need - rehabilitation, maintenance and expansion of transportation infrastructure - and not simply another shovelful of tax dollars into the bottomless maw of government. 

Taken in isolation, the gas tax is among the more rational components of overall tax policy.  It is consumption-based.  Properly-conceived, its revenues are dedicated solely to spending that is directly related to that consumption - roads, bridges, etc.  It is applied to a commodity whose price is highly variable in the first place, proving that the market can absorb periodic increases (always with the expectation of a later drop, of course).  On the spectrum, it is easy to understand why Governor Patrick - and now LG Murray - return repeatedly to the gas tax.  The arguments in favor can be compelling.

Ah, but that context thing again.  Here and now we aren't looking at a gas tax in isolation.  We're looking at it in the throes of a recession.  We're looking at it barely more than a year following a whopping 25% hike in the sales tax that was supposed to sate the transportation beast.  We're looking at it in conjunction with inexorably creeping property tax rates, the near certainty of a looming federal income tax hike, high unemployment, stagnant wages. 

And we're looking at it as a way to pour more funding into a fully dysfunctional statewide transportation system that is up to its (our) eyeballs in debt incurred in considerably part to pay years of exorbitant salaries and health and retirement benefits to its own employees. 

Back in March 2009, the first time the Patrick/Murray tandem made a run at the state gas tax, Senate President Murray said the following:
“As public officials, we should not be so careless or quick to throw tax-payer money into a broken system.” She called a rush to boost the state’s gas tax, which Gov. Deval Patrick has posited as the only way to avoid a March 29 turnpike toll increase, premature.
True then.  Truer now.

Wednesday, July 20, 2011

If only we'd elected more Democrats...

Deval Patrick, our traveling governor, was on the road again yesterday, this time not to sell his book or raise money for his PAC, but to stump for President Obama in New Hampshire.

No matter that State Street had just announced that it was cutting more than 500 jobs in Massachusetts, the Globe reports that “most of Patrick’s remarks, which drew cheers, laughs, and one standing ovation from the crowd of about 200, focused on creating jobs.” I’m assuming the laughs weren’t at the absurdity of the governor of a state with 7.6% unemployment lecturing a state with 4.9% unemployment about jobs.

Patrick goes on to lament that a story like his own story of achieving the American dream “is a story that seems increasingly difficult to tell for the unemployed in Massachusetts and elsewhere.” Returning to an anecdote he had used frequently during the last campaign, Patrick “described a visit he made to a Quincy job center where most of the members had gone 18 months or more without work.” (You may recall this from one of the gubernatorial debates in which he mentioned that this group meets at an IHOP and proceeded to explain for us all that IHOP stands for “International House of Pancakes.”). Patrick returned there in February and at that point, many of the group had been unemployed for close to two years.

It’s almost like Patrick forgets that he’s been governor of Massachusetts for the last four and a half years. Or rather, he is totally oblivious to the fact that choices he and LG Tim Murray have made may be contributing to unemployment or slowing down the state’s recovery. Nope, nope, nope. When there is good news or good data, it is all thanks to him, but when somebody has been unemployed for 18 months while he’s been governor, it certainly doesn’t reflect poorly on him. (And really, when does this start to come back on him? Shouldn’t some enterprising reporter find out whether any of these unemployed people he met with a year ago and five months ago are still unemployed? Are there more people in this jobs club today than there were last year? At what point does this stop becoming an anecdote about the troubled economy and become an anecdote about his administration's performance in office?) [Ed. note: HA! - Dan]

Patrick’s denial about the connection between his – or any Democrat’s – actions and the fact that there are people who have been unemployed for almost two years is evident in his speech. As the Globe reports, the story of the Quincy people struggling to find work is “all the more reason, he told his audience, for Democrats to get involved in the 2012 campaign.” Yes, you read that right. The solution to our nation’s economy is to elect more Democrats. Democrats like Barack Obama, who has brought us unemployment of 9% or above for all but 6 months of his presidency.

Sounds like Patrick is giving us all a reason to vote Republican.

Tuesday, July 19, 2011

They said WHAT??!!

As expected, it did not take long for the legislators (and ex-legislators) involved in Beacon Hill's latest patronage scandlet to be outed.  According to the Globe, former Rep Paul Kujawski (Kujo to his friends) and current Rep. John Binienda each placed a brother and a son, respectively, in the employ of the Commonwealth's Alcoholic Beverages Control Commission (ABCC).  What makes this little scandal unique even in this unusually active season of scandal is the fact that the animating allegation in question - that these particular patronage hires were made expressly in exchange for legislative approval of funding - comes not from a political crank or even a whistleblower, but rather from the agency itself, in legal filings in an employment discrimination case brought by a veteran who claimed he was unfairly passed over for a job at the Commission. 

Current Treasurer Steve Grossman, who oversees the ABCC, has already announced that he will not be taking any knee-jerk action against the two employees in question.  “I’m trying to take everyone on face value,’’ Grossman tells the Globe. “We will give everyone a fair shot at demonstrating that they are capable of doing distinguished work regardless of how they arrived.’’  He'll take some criticism for that, but it is the correct course.  Although it would be easy to leap to the assumption that the two employees in question were blatant patronage hires, it would be unfair to essentially penalize the pair for the gene pools from whence they came.

More interesting are the reactions from House Speaker Bob DeLeo and Senate President Therese Murray.

House Speaker Robert A. DeLeo yesterday called the Globe’s report “disturbing’’ and planned to ask Grossman about it this week, according to a spokesman. Senate President Therese Murray told reporters she too wanted more information on the case.

“I would like to know why a case like that was settled and we paid money for them to give that kind of an answer or to use that kind of excuse for not hiring somebody,’’ Murray said.
Following frequent repetition of his own name in the 'Ware Report' on patronage in the state probation department Speaker DeLeo has been at the forefront of several efforts to rein in Beacon Hill's rampant patronage culture in recent months, so it is a bit hard to believe he is 'disturbed' to learn of yet another patronage haven in state government where his lieutenants have been stashing relatives.

President Murray's reaction is perhaps more honest.  She wants to know how in the *%&$ the agency's taxpayer-funded lawyers were allowed to "give that kind of an answer," right out there in the open for anyone to read.

Monday, July 18, 2011


Here's one to watch.  The Globe:
The Patrick administration is seeking to delay approval of the merger between Boston’s NStar and Connecticut-based Northeast Utilities until at least next year - a move that, if successful, could unravel the deal to create one of the nation’s largest utility companies.

The administration, through the Massachusetts Department of Energy Resources, last week filed a request with state utility regulators to put off action on the merger until NStar completes a formal review of its rates, which could begin as early as May but could take several months. That means regulators may not be able to take up the case again until late next year, well beyond the April 2012 date the utilities originally set to reassess the deal if regulatory approvals were not in place by then.

Caroline Allen, an NStar spokeswoman, said yesterday that such a “substantial delay’’ could ultimately jeopardize the deal.

“It’s unfortunate because this seems inconsistent with the Patrick administration’s desire to improve the business climate in the Commonwealth,’’ Allen said in a statement. “Here are two Massachusetts companies, coming together to form a Fortune 250 company, keep jobs local, and result in $784 million in customer savings over 10 years.’’

Mark Sylvia, commissioner of the state Department of Energy Resources, said, “We’re not attempting to kill any deal. What we’re trying to do is our job and our due diligence.’’

The state, he said, simply needs more information about NStar’s rate structure so it can best protect consumers as the merger goes forward.
So the Patrick Administration wants to push off a huge business deal for as much as a year, so that it can take a closer look at the proposed merger.  Sounds reasonable.  More:
This latest move was prompted, in part, by concerns over the impact of the merger on NStar’s business and residential customers, Sylvia said. NStar’s electricity rates are among the highest in the state. and its residential customers pay on average of $7 to $19 a month more than customers of National Grid, according to data from the Department of Public Utilities.
Sylvia asked if there are going to be additional costs to ratepayers if the merger goes through. That’s difficult to assess, he said, because it has been 25 years since NStar last went through a full-blown rate case, in which utilities open their books to a full financial review by regulators, and then offer testimony and other evidence to justify rate requests and address concerns of customers and other interested parties.
 Now it sounds really reasonable!  The Patrick Administration is just looking out for consumers, don'cha know.  But hang on a second.  Has anyone else looked at this proposed deal?  According to the Globe, yes, "[t]he partnership received approval from the Federal Energy Regulatory Commission this month..."  That'd be the FERC, otherwise known as the federal agency with jurisdiction over, among other things, electricity rates. Oh, and Attorney General Martha Coakley, who negotiates utility rates on behalf of Massachusetts consumers on a regular basis, is supportive of the merger too - specifically on the cost issue.  According to her spokesman, "This merger could lead to substantial savings... and we continue to advocate that these savings need to be passed on to consumers."

Ordinarily it is unusual to find the state's utility regulator at odds with the feds, or so significantly behind in their approval timeline.  And it is strange to see such polar opposite stances from the Governor and the AG on an issue like this one. There must be something extraordinary about this deal...

"Ready for your full-blown rate case?"
Skip back to that last block quote.  The Patrick Administration proposes to put NSTAR through a "full-blown rate case," during which "utilities open their books to a full financial review by regulators, and then offer testimony and other evidence to justify rate requests and address concerns of customers and other interested parties."  If you think that sounds a bit like the regulatory equivalent of a two-fisted enema, you aren't wrong.

I wonder if there is an unspoken "unless" clause in the Patrick Administration's position... something NSTAR could do to convince the MDER to set aside its rubber gloves.  I'd bet big bucks there is...

You see, the Patrick Administration really, really cares about consumer electricity rates... except when it doesn't.  It wasn't too long ago that Patrick and Co. were casually brushing off critics of Cape Wind who pointed out, correctly, that by pushing it through the Governor was essentially imposing an electricity rate hike on Massachusetts consumers.  Cape Wind, the Governor told us, "is all about our energy future."  When it's "all about our energy future," considerations of present cost fall quickly to the wayside.

But there is a problem with Cape Wind.  It has only managed to contract out half of its anticipated power production - to NSTAR's main competitor, National Grid.  And National Grid (which is to say, its customers) is going to pay a premium for that great Cape Windy feelin'.  As reported by CBS Boston a couple of months back: "National Grid estimates its deal with the Cape Wind offshore wind project will cost ratepayers $1.2 billion above the projected market price of comparable energy by the time it’s done," at a rate of about 18.7 cents per Kilowatt Hour, with contractual annual increases of 3.5 percent. 

Why?  Why oh why would National Grid agree to such a thing?  Well, for one thing a law passed in 2008 requires Massachusetts utilities to get a certain percentage of their power from renewable sources.  So a charitable view would be that NGRID is just looking to fill its politician-mandated quota.  Except... NSTAR found another way.  CBS Boston again:
NStar’s deals with land wind farms in Massachusetts, New Hampshire and Maine provide 109 megawatts, about 1.6 percent of NStar’s demand, leaving it with power to purchase to meet state requirements.

NStar won’t disclose its pricing, but energy experts, including New York-based consultant Bill Short, have made estimates. He said his calculations put the three projects’ average cost at 9.4 cents per kilowatt hour. The price remains flat during the contracts, which run 10 to 15 years.

National Grid directly negotiated its deal with Cape Wind. NStar requested bids — eventually receiving 74 qualified proposals — as part of a standard, state-approved process that put heavy emphasis on lowest price.
So NSTAR is going to get its renewable power - from wind, no less - at roughly half the cost at which NGRID has agreed to buy half of Cape Wind's power.  And meanwhile, Cape Wind still has no taker for the other half of its premium-priced juice.

No likey.
Gov Patrick no likey.

By utter coincidence (surely!), it was around the time of NSTAR's decision to turn down Cape Wind's invitation to gouge its customers in service to "our energy future" that the Patrick Administration first determined to put its big regulatory foot down in the middle of the NSTAR-Northeast Utilities merger.  And just by coinkey-dink, some of those "other interested parties" who are queued up to weigh in to the NSTAR enema - er, rate case - include project developer Cape Wind Associates LLC and project supporters Cape Light Compact and the Conservation Law Foundation.

As soon as the Administration evidenced its intention to insert its snout into the NSTAR deal with more than ordinary enthusiasm, Cape Wind opponents publicly suggested that there might just be an "abuse of regulatory authority" afoot, in service to the Governor's pet wind project.  The Administration's response was rich:
The state does not act as sales representative for any power generator, said Lisa Capone, spokeswoman for the Massachusetts Executive Office of Energy and Environmental Affairs.

“That said, it is well known that Governor (Deval) Patrick considers Cape Wind an important project in terms of clean energy and jobs for the commonwealth, and that the contract between Cape Wind and National Grid establishes terms that satisfy the attorney general and have been approved as cost-effective by the Department of Public Utilities,” she said.
Talk about a pregnant "that said..."  'The state does not take regulatory hostages to leverage compliance with its policy agenda... that said...'

No less a liberal luminary than Robert F. Kennedy said it explicitly today in a Wall Street Journal op-ed:
In only the latest example of how heavy-handed Cape Wind's backers are, Massachusetts has suddenly agreed to change the rules for utilities as they apply to mergers and the reduction of greenhouse-gas emissions. In effect, the state administration is trying to hold hostage the proposed NSTAR-Northeast Utilities merger unless the two electric companies agree to buy Cape Wind's power.
So to sum up:

The Patrick Administration just moved to delay a proposed merger between NSTAR and Northeast Utilities, which the feds have approved and the AG has determined would lead to consumer savings, due to wholly unsubstantiated concern that the deal might actually raise consumer electricity rates. 

At the same time, the Patrick Administration is fully behind NGRID's contract with Cape Wind, which they openly acknowledge will result in a substantial increase in consumer electricity rates.

And finally, it is no stretch to suppose that if NSTAR were to reverse itself tomorrow and agree to buy that second half of Cape Wind's output, with its associated rate premium and consumer price hike, the Administration's desire for a "full-blown rate case" would suddenly melt away - along with all this talk about consumer electricity costs. "Our energy future" and what-not.

Ladies and gentlemen, I give you Massachusetts.

Truth: A "novel defense" (another patronage scandal a' brewin')

It is front page news, but a lot of Globe readers will skip past today's above-the-fold article titled "Review ordered of liquor agency."  Sounds like a yawner.  If you missed it, give it a read.  It is much more interesting than the title implies.

The article starts with some run-of-the-mill budgetary excess:
The Alcoholic Beverages Control Commission has spent an amount nearly equal to its annual budget in the past two years to resolve a trio of employment cases involving harassment, discrimination, and retaliation, according to interviews and documents obtained by the Globe through public records requests. The cases - two settlements and a court judgment - stem from complaints filed by former workers and a prospective employee over the past decade.
Okay, so yet another state agency is burning through taxpayer dollars like kindling at a camp out.  Blow me over. But that's not the really fun part of this article.  That comes next:
In one case, settled in 2009, the agency presented a novel defense to accusations it had unfairly denied a 57-year-old veteran a job. The defense: The two available slots had to go to relatives of lawmakers, or the Legislature would not fund the positions, according to legal documents.
One can imagine the agita that birthed that bit of legal strategy.  Forced to choose between allowing the agency to be credibly painted as ageist/anti-veteran or opening the blinds to let some light in on yet another state government patronage haven, the decision-makers at ABC went with the latter.  They couldn't hire a vet to fill either of two open positions, you see, because they needed those slots to trade to the Legislature for state funding. 

The article is a little light on details - which lawmakers?  Which relatives?  One hopes for and expects a follow-up story or two.  In the meantime, Treasurer Grossman (who oversees the ABC - though, I hasten to add, his self-immolated predecessor was doing the "overseeing" when all of this went down) has asked the Inspector General to take a look at the ABC, and has pledged to hire "an independent consultant to conduct a comprehensive audit."  That last bit prompted Republican State Rep Dan Winslow to ask via his Facebook page, "Um, how about the State Auditor Suzanne Bump?" 

A cynic might assume Treasurer Grossman knows full well that Auditor Bump won't go anywhere near another brewing patronage scandal...

Promises, Promises

Yet another addition to the long list of ways Governor Patrick has gotten up under my skin this year.  I haven't been able to get this song out of my head since reading yesterday's Herald editorial, Gov's numbers game. We covered this topic nearly a month ago, here ("Addition by Subtraction").  Here's the Herald's editors:
Yes, it’s true that political promises are, well, in a class by themselves. That is, no one but a naif really expects them to be kept.

Still, we’re grateful for a recent study by the Pioneer Institute that confirms our cynicism.

Two years after Gov. Deval Patrick promised (during the run-up to passage of the budget) to cut the state payroll by 1,000 jobs, the state had added 1,210.
It's in your head now too.  Blame the Governor.
 There is a legitimate debate to be had about whether state job cuts are the right thing to do.  I come down on the side of those who believe the state workforce - in the nature of nearly every bureaucracy - has bloated over time, growing inefficient, redundancy-ridden and overpopulated.  Others disagree, arguing that job cuts impact services and unfairly burden the individuals whose jobs are cut - and their families. 

The problem is, we never really had that debate  here in the Commonwealth.  Instead, Governor Patrick read the political tea leaves and determined it was necessary for him, in the run-up to a reelection campaign, to at least appear to be on the side of the government-trimmers.  And so back in 2008 he loudly proclaimed his intention to "cut 1,000 state jobs."  Challenged on the point last year during the gubernatorial race, Patrick stuck to the assertion, counting those cuts among the "accomplishments" that supposedly justified continued voter confidence in his stewardship of the cash-strapped state government.  Now, as first the Pioneer Institute and now the Herald have pointed out, it is apparent that those "cuts" were wholly illusory - another example of the Patrick Administration's creative math.  The Herald ends on a cynical note:
How did it happen?

Pioneer credits the New England Center for Investigative Journalism for extracting from the Department of Transportation an explanation that 72 employees were supported by federal stimulus dollars and another 313 were “temporary” — for eight years! (By that standard we’re all temporary; our jobs will end someday by resignation, dismissal, retirement or death.)

The lesson in this? Government — any government — will trumpet promises but maintain the same-old, same-old and clam up about it. But you knew that already.
Somewhat less than 50%, unfortunately.  Others seem not to care.  The point to keep in mind is that in a couple short years Lt. Governor Tim Murray will start roaming the state, and in his campaign talking points will almost surely be included that wholly discredited 1,000 jobs cut statistic.

Saturday, July 16, 2011

Governor Patrick's budget claims an insult to Fuzzy Math

If you're going to make stuff up, you might as well go for the gusto.

That seems to be the animating principle behind the Governor's self-congratulatory rhetoric about the budget he just signed.

As usual, the numbers just don't add up. According to the Governor's press release on the signing of the Fiscal Year 2012 budget, FY12 state spending was reduced by $750 million, the largest year-to- year reduction in 20 years.

This statement is simply not true and - as is often the case when politicians fudge the numbers - it really isn't very difficult to figure that out. Math and all. Take a look at the Fiscal Year 2011 projected spending: $30,853,255. Now compare it to the Fiscal Year 2012 budget's spending: $30,597,924. The difference in spending is $255. Which, unless my math is off, is... less than the $750 million the Governor's release claimed. Three times less.

Of course, even the $255 million figure won't stand. There are still many factors in play. Fiscal Year 2011 needs to be closed out and final spending and reversions need to be applied to the accounts. When all is said and done, the final 2011 spending figure will narrow the $255 million delta, if not eliminate it completely.

It is also inevitable that spending adjustments will be made in Fiscal Year 2012, probably sooner than later, that will add to the Fiscal Year 2012 spending. In the last two years alone, actual year end spending averaged over a billion more both years compared to the General Appropriations Act enacted into law at the beginning of the fiscal year. And of course there is the little matter of that billion in imaginary health care savings the 2012 budget relies on for "balance."

The Governor's claim of record cuts just isn't true. His math isn't even "fuzzy." It's not even math. It's fiction.

Friday, July 15, 2011

Top 10 Reads of the Week – July 15, 2011

Not Taking Other People’s Money – Arthur Brooks [Weekly Standard]

The problem with socialists, according to Margaret Thatcher, is that “they always run out of other people’s money.” We haven’t hit that point just yet, but we have hit our nation’s legal credit limit of $14.3 trillion. To avoid defaulting on our loans, policymakers must raise that limit.

For many Americans, this is absurd and humiliating: The richest country in the history of the world is teetering on bankruptcy because our government can’t stop itself from spending, like a loathsome celebrity blaming bad behavior on some dubious new addiction. No surprise, then, that more than 60 percent of Americans believe Congress should not raise the federal debt ceiling, according to a recent CBS News poll. This does not mean they want to see America default, of course. Rather, it indicates a strong popular will to see our government stop its ruinous spending… Read the Rest

Obama vs. Obama – Stephen Hayes [Weekly Standard Blog]

In a 75-minute meeting Sunday night, President Obama once again demanded that more than $1 trillion in tax increases be part of any deficit reduction package attached to a vote on the debt ceiling. In the session, Obama rejected a Republican proposal to seek $2.5 trillion in spending cuts and reforms, and insisted on higher taxes on businesses and wealthy individuals.

It’s a curious position, given the anemic economic growth and rising unemployment. And it’s even more curious considering that Obama himself has warned about the deleterious effects of raising taxes in a struggling economy… Read the Rest

Taxes Upon Taxes Upon… – Editors [Wall Street Journal]

So the fondest Washington hopes for a grand debt-limit deal have broken down over taxes. House Speaker John Boehner said late Saturday that he couldn't move ahead with a $4 trillion deal because President Obama was insisting on a $1 trillion tax increase, and the White House quickly denounced House Republicans for scuttling debt reduction and preventing "the very wealthiest and special interests from paying their fair share."

How dare Republicans not agree to break their campaign promises and raise taxes when the jobless rate is 9.2% and President Obama's economic recovery is in jeopardy?… Read the Rest

Raise Taxes or Granny Gets It – James Taranto [Wall Street Journal]

President Obama is pulling out the big guns and pointing them straight at your grandmother. "Obama on Tuesday said he cannot guarantee that retirees will receive their Social Security checks August 3" absent an agreement with Congress to raise the debt ceiling, CBS News reports:

"I cannot guarantee that those checks go out on August 3rd if we haven't resolved this issue. Because there may simply not be the money in the coffers to do it," Mr. Obama said in an interview with CBS Evening News anchor Scott Pelley, according to excerpts released by CBS News... Read the Rest

Close the door on public-sector unions – Jeff Jacoby [Boston Globe]

MASSACHUSETTS GOVERNMENT is almost a wholly owned subsidiary of the Democratic Party, so there was no chance that a law limiting collective bargaining for municipal employees would resemble the recent laws passed in Wisconsin and Ohio. The measure signed this week by Governor Deval Patrick will hold down the cost of providing health benefits to teachers, firefighters, and other local workers by modestly curbing their unions’ right to veto changes to employee health plans. For the ultra-blue Bay State, that was a notable accomplishment. But it wasn’t the “Union Busting, Massachusetts Style,’’ that a Wall Street Journal headline hopefully predicted back in April… Read the Rest

Obamageddon Coming to a City Near You?  - Walter Russell Mead [The American Interest]

The election of the first African-American president was widely hailed as a giant step forward for American racial politics.  The future, however, may remember this administration as a giant step back for Black America during a period of  deepening alienation, anger and despair in America’s inner cities.

Not since the 1960s, when scores of American cities were shaken by one race riot after another, have African-Americans faced such deadly conditions: high expectations and hopes running up against a reality of vanishing jobs, shrinking government budgets and a fractured and fragmented leadership.  Barring an unlikely change in economic fortunes we could soon face a new period of explosive anger and even violence; alternatively, the urban poor could fall prey to a new kind of passive despair and anomie as hope dies on one inner city street after another… Read the Rest

How Unclean Was My Valley – Mark Steyn [SteynOnline]

Take a look at this photograph. It appeared in The Toronto Star’s education section on Saturday:


It’s the scene every Friday at the cafeteria of Valley Park Middle School in Toronto. That’s not a private academy, it’s a public school funded by taxpayers. And yet, oddly enough, what’s going on is a prayer service – oh, relax, it’s not Anglican or anything improper like that; it’s Muslim Friday prayers, and the Toronto District School Board says don’t worry, it’s just for convenience: They put the cafeteria at the local imams’ disposal because otherwise the kids would have to troop off to the local mosque and then they’d be late for Lesbian History class or whatever subject is scheduled for Friday afternoon… Read the Rest

The comedian-in-chief – Michael A. Walsh [New York Post]

Here's a joke for you: President Obama nearly bankrupts the country with his out-of-control deficit spending -- then demands responsible fiscal leadership from the Republicans.

OK, this is no time for humor: The country faces a deadline of Aug. 2 to either raise the debt ceiling from $14.3 trillion to around $16 trillion or face the prospect of defaulting on our loans and cutting services… Read the Rest

Yes, You Really Can Cut Your Way to Prosperity – Andrew Biggs and Matthew Jensen [The American]

In December 2010, we released a working paper on fiscal consolidations accompanied by a Wall Street Journal op-ed, both co-authored with our AEI colleague Kevin Hassett. The goal was to analyze what worked—and what didn't—in balancing national budgets. The paper’s findings have generated some interest, including being cited approvingly by congressional Republicans and critiqued by one of the Economist magazine’s Free Exchange bloggers.  

Our methodology was straightforward. We studied over 20 Organization for Economic Cooperation and Development countries for a period spanning nearly four decades. We first isolated instances in which countries took steps to address their budget gaps. These steps are referred to as “fiscal consolidations.” The literature prescribes two ways to identify fiscal consolidations, one popularized by Harvard economist Alberto Alesina and the other established by the International Monetary Fund. We used both. Some of the fiscal consolidations were spending-based, others relied more on taxes… Read the Rest

Regime Change May Be Needed to Cut Deficit – Charles Krauthammer [Investors Business Daily]

President Obama is demanding a big long-term budget deal. He won't sign anything less, he warns, asking, "If not now, when?"

How about last December, when he ignored his own debt commission's recommendations? How about February, when he presented a budget that increases debt by $10 trillion over the next decade? How about April, when he sought a debt-ceiling increase with zero debt reduction attached?… Read the Rest

Funniest Thing I Saw This Week:

Members of Twisted Sister Now Willing to Take It [The Onion]TS

NEW YORK—In a stunning reversal of their long-stated reluctance to take it, members of heavy-metal band Twisted Sister announced Monday that, after 24 years of fervent refusal, they are now willing to take it. "I acknowledge that we promised not to take it anymore, but things change. The world is a different place today, and with that in mind, we would like to go on record as saying that, starting right now, we are going to take it," read a statement released by the band's lead singer, Dee Snider. "To clarify, we would still prefer not to take it, but as of now, taking it is an option that we would be open to. That is all." Bassist Mark "the Animal" Mendoza also stated that, in regards to what he wants to do with his life, he no longer solely wants to rock, but would instead prefer doing other things, such as raising a family and working as a claims adjuster in Rye, NY.