john maddente | midwestern clarity

A  friend* trying to console me after Mr. Obama's re-election, shared a timeless quote:   "Again and again after freedom has brought opportunity and some degree of plenty, the competent become selfish, luxury-loving and complacent, the incompetent and the unfortunate grow envious and covetous, and all three groups turn aside from the hard road of freedom to worship the Golden Calf of economic security.  The historical cycle seems to be: from bondage to spiritual faith; from spiritual faith to courage; from courage to liberty; from liberty to abundance; from abundance to selfishness; from selfishness to apathy; from apathy to dependency; and from dependency back to bondage once more." These prophetic words came from the leader of a Pennsylvania cork company during a speech he delivered on  March 18, 1943.   The speech was delivered by Henning Prentis.   Mr. Prentis also wrote this: " At the stage between apathy an...

Excerpts from my letter to the editors at the New York Times Magazine  concerning a cover story on Paul Ryan in the October 21 issue which were published online November 1 .    Illustration by Jaime Hernandez The excerpts  also appear in today's print edition of the New York Times Magazine.  My apologies for the blurry, tiny font.   

I saw Mr. Stein speak in San Diego last June.  An interesting figure: part lawyer, part economist, part actor -- and he's also quite funny at the stump.  Some of his latest wisdom on health care and immigration policy follows...  Ben Stein - SodaHead image "Fathom the hypocrisy of a government that requires every citizen to prove they are insured. . . but not everyone must prove they are a citizen."     Now add this, "Many of those who refuse, or are unable, to prove they are citizens will receive free insurance paid for by those who are forced to buy insurance because they are citizens."

C onceptually, it's not more regressive than what we have but it's being labeled as such by Obama supporters who conflate marginal tax rates with effective tax rates. Lower marginal rates on a broader base of income is a step toward real tax reform.  Reduce the mountain of deductions, credits and incentives -- apply lower marginal rates to a greater aggregate of taxable income and in the process remain revenue neutral while simplifying the tax code.  What's wrong with that? Perhaps the problem for Mr. Obama's supporters is that remaining revenue neutral might help curb run  away government spending . (This is a CEO, not a Community Organizer)

I n his piece from the current issue of Fortune magazine , Geoff Colvin says the current environment is a "...nasty, insidious force that's undermining the native optimism that buoys up business people everywhere" and then he admonishes readers with one word --  "Resist!" I appreciated another article in this issue by Ms. Mina Kimes who wrote about a manager for the MFS International Value Fund -- Mr. Barnaby Wiener.  Like a lot of people; I largely stick to index funds , but Mr. Wiener's actively-managed  fund according to Fortune, is one of the best in its class having outperformed 99% of its peers since 2002.  Mr. Wiener says "It's much more important to avoid losing money than it is to make money"  and he adds, "If you avoid the big losses, you make money almost by default."   Those statements seem consistent with Warren Buffet's well-known view, "The first rule of investing is don't lose money; the second ru...

R aison d'être -- is French for "reason for existence" -- which is a heady concept.  I'll define this blog's  raison d'être  for my  five  six readers, with this post.  Many of my posts center on fiscal responsibility.  Fotosearch Image So when I see a column I agree with as I did today in WSJ by Steven Malanga ("State Politicians and the Public Pension Cookie Jar") -- I share it and talk about it.  I hope in a small way, I'll add attention to the generational burden-shifting and recklessness taking place (and it feels good to get gripes out of my system and into a post). Mr. Malanga focuses on at least one part of a multi-faceted national spending problem -- defined benefit programs for public employees -- better known as public pensions .  I didn't understand how costly they are until some six years ago, when a retired pediatric dentist of all people, began to educa...

O n  Bloomberg TV last month ,  former U.S. Senator Phil Gramm discussed the housing meltdown, as well as, his own work to deregulate the banks .   Phil Gramm, Wikipedia During the course of the interview, Mr. Gramm highlights " concerted government action and pressure on banks " to make sub prime loans and destructive decisions in Washington " to force feed housing " ownership. The Bloomberg interviewer insinuates that there were as many predatory lenders as predatory borrowers.  So, exactly, what is a predatory lender?  I believe many borrowers were unaware of the potential risks of their variable rate mortgages.  That's fair.   However, were millions of people buying more home than they could afford, or sucking more equity out of their homes than they could afford to lose; all largely duped?  I never believed so and still don't believe so. Gramm asserted that for every subprime borrower who actually got swindled by ...

Ron Paul, Wikipedia Ron Paul -- I remain conflicted about Ron Paul.  The reasons are simple and shared by a number of GOP voters.  Let's first look at the plus side.  I love the man on fiscal policy.  As he once described his zeal to cut federal spending, “ I am absolutely convinced it is the only road to prosperity .”  On monetary policy -- Ron Paul is the gold standard (pun intended). If not for the Tea Party, I'd have bolted from the Republican Party a few years ago because I wasn't seeing enough Republicans walk the fiscal talk that Rep. Paul walks every day.  Then I discovered Ron Paul.  When Ron Paul says he'd cut a trillion dollars in federal spending year one, he even tells you how he'd do it .  When he talks about The Fed's destructive, easy money policies -- he means it.  I admire his courage and consistency.  Unfortunately, Rep. Paul's foreign p...