What I saw on Feb. 11 in Madison, Wisconsin

It was a clear day at the Capitol.

What wasn't reported quite as clearly, among other things, was the composition of the Pro-Walker forces, which were outnumbered I'm guessing, by about 20 to 1 -- thanks in large part to throngs of out-of-state demonstrators.  One problem with the media characterization, was that they consistently reported the Pro-Walker group only as a "Tea Party" rally.  

Obviously, Tea Party members were out in force but the group contained a broader cross-section of voters including mainstream GOP members and even a few Blue Dog Dems including one courageous soul holding a sign labeled, "I'm A Teacher For Walker."  I believe that man has more company than most people realize, particularly among private school teachers that are non-unionized and paid significantly less in wages and benefits than their public school counterparts.  

But back to the afternoon event.  It was non-violent, but press accounts labeling it as "peaceful" stretch the adjective.  The government union faithful were deployed in a circle, perhaps a dozen members wide, that encircled the entire capitol building so that Pro-Walker supporters had to walk through them, and their insults, in order to get to the muddy basin of the capitol steps where Walker supporters gathered.  There were three times protesters tried to engage me in dialogue which I ignored to avoid a fruitless, heated debate -- or worse.  Remember, I said nothing before or afterward to these people.  That sort of provocation occurred repeatedly -- but you probably didn't read about it.  

Another unreported, or at least under-reported development, occurred near the lectern of the pro-Walker gathering.  Suddenly, the speaker's booming voice went silent.  Turning to a friend, I said, "That was no accident."  Seconds later, an opposition mole was ushered away by Sheriffs and the sound system began to work after someone plugged it in again.

Union members marching around the capitol circle chanted, beat drums and hoisted signs -- most of which contained civil inscriptions -- but others with words or images of Governor Walker that are unrepeatable on this site.  Again, I saw no press coverage of these signs, though they were hard to miss.  I hoped that the owners of those particular signs are not teaching children.  I'm not sure they should be near children.  

To be fair, I saw a couple signs in the pro-Walker camp that I also found objectionable, but they were less numerous than vile ones paraded by the other side. 

In yesterday's Wall Street Journal, columnist John Fund distills all this clamor into one question.  Mr. Fund asks, "Who's in charge of our political system -- voters or government unions?"  For decades, of course, the answer in the Badger State has been government unions.  That's about to end.  The objective is not to bust them, it's about requiring them to pay a reasonable share of their lucrative benefit packages and maintaining more future control with voters.

John Maddente photo

Fortunately, legislators do not need the 14 absent Dems to vote on the collective bargaining provision of the bill. 

Collective bargaining is a mechanism many want scaled back because such "bargaining" over the decades is what led to the out sized, budget-busting wage and benefit packages for many public employees. Pushing decisions down to the local levels makes sense.  Instead of allowing the Left to spin this as destruction of "rights" -- it's more accurate and less emotional -- to characterize the legislation as a move toward distributed bargaining.  

Claiming that collective bargaining is some divine "right" doesn't make it so either.  If you're a public teacher and you disagree, try looking at the issue in the following terms.  Most of us cannot "bargain" for higher pay or benefits.  Instead we receive a market-based pay package and a defined benefit plan, not a guarantee of retirement income and virtually free health care plans.  If we feel that our benefits or pay packages are unacceptable -- we find work elsewhere.  We do not have, nor do we seek, any collective means to hold employers (or taxpayers) hostage. 

Another notion advanced by some on the Left, is that this legislation is a surprise hijacking that nobody talked about before the election.  Senator Lindsey Graham (R-SC)  speaking this morning on Meet The Press explained how measures in the bill causing such a stir, are a well documented facet of candidate Walker's campaign before he took office.  Informed voters knew as much when they elected him.  Arguably, it is a one reason that they did elect him.  

What is unprecedented, of course, are the fourteen fugitive Democrat state senators.  It's a disgraceful signal to young people or anyone considering a career in public service.  When things get tough, flee the state -- just take your ball and leave.  That way, no one can play.  

I hope that this stalemate doesn't turn violent.  We can all disagree without throwing punches, but what I saw yesterday worried me. 

 

(Image above taken in Madison, WI 2/19/2011.  John Maddente photo)

A writer's words to live by

The following passage was shared with me recently.  It was written by a German writer, Rainer Maria Rilke.  Mr. Rilke died in 1926 at the age of 51. 

This piece is taken from his "Letters To A Young Poet".  I find these words timeless, profound and moving.   Please consider sharing them with someone.

_______________________________________________________________________________

Be patient toward all that is unsolved in your heart

and try to love the questions themselves.

Do not now seek the answers, which cannot be 

given you because you would not be able to live them. 

And the point is to live everything.

Live the questions now. 

Perhaps you will then gradually, without noticing it, live along some distant day into the answers.

AEI scholars' research: taxes vs. spending cuts

OMB Chart

Excerpts published at Examiner.com

An editorial grabbed my attention recently.  Titled, "The Right Way to Balance the Budget" the piece was published on page A13 of the Wall Street Journal on December 29th. 

Three scholars from the American Enterprise Institute (AEI) collaborated on the aforementioned article.  They examined the likelihood of success coming from three choices we have to address our deficits and the national debt.

The choices of course are: tax increases, spending cuts, or a combination of both.

AEI website: Andrew Biggs

AEI website: Kevin Hassett

Two PhD economists, Andrew Biggs (London School of Economics) and Kevin Hassett (University of Pennsylvania) and economic research analyst Matt Jensen, argue their case by building on the prior work of two Harvard economists: Albert Alesina and Silvia Ardagna.

Messrs. Biggs, Hassett and Jensen conclude the primary way to fix our fiscal predicament is singular in nature -- cut government spending.  Period.  (Although they'd hasten to add that the type of spending cuts implemented does matter).  According to their thesis, the notion of raising taxes, or even using a combination of tax raises and spending cuts -- will not work. 

The case for cutting federal (and state) government spending has been simple -- increasing revenues for the government without statutory spending restraints, will only result in continued spending because historically, government reverts to its spendthrift ways when it is not legally shackled to do otherwise.

Remember, we had a balanced federal budget as recently as 1998 and ran surpluses for a few years but Congress and the Executive branch of government failed to continue a fiscally responsible path, so here we are in 2010 facing a 14 Trillion dollar monster.

No wonder many Americans believe that neither Congress, or any President can be trusted to remain fiscally responsible.  So, what about the experience of other industrialized, debt-laden countries?  Here's the verdict from the AEI authors who analyzed the history of debt consolidations attempted in 21 nations over the course of 37 years...

The authors assert, "...the typical unsuccessful consolidation relied on 53% tax increases and 47% spending cuts."  

Some observers predict that this is precisely the sort of compromise (i.e. arriving at a closely weighted mix of tax increases and spending cuts) which will be hatched by pols in Washington trying to tackle our own debt problem (or appear as though they are).

Biggs-Hassett-Jensen conclude that nations achieve fiscal balance only after applying austerity measures which include a minimum 85% reduction in spending cuts.  In other words, no more than 15% of the total solution, comes from tax increases.  They also hold that nations achieve these cuts primarily by responsible reduction of social transfer payments.

Surprised?  We have to significantly reduce spending now to avoid much more devastating pain later, because nations don't tax their way to solvency.

Public Notice - the bankrupting of America

Public Notice is "an independent non-profit dedicated to providing facts and insight on the economy and how government policy affects Americans’ financial well-being."  

Here's a slide from them (with holiday flair) called "The 12 Days of Government Spending"

A post-election reply to Mortimer and Stanley

Wikipedia

Here are excerpts from a reply to two friends - disguised with fake names - Mortimer and Stanley.   

These guys fall at opposite ends of the political spectrum, but their exchanges are always respectful.  The three of us have been "sparring" since our teens. 

Some text changed, but it is close to the original version when I responded to their post-election e-mail dual of 11/3/2010...

"Dear Mortimer and Stanley,

I love your passionate sentiments about today's political landscape and all that ails us.  I agree with both of you - to an extent. Ah, the advantage of going last...

I'll start with Stanley and his Mortimer rebuke - "Greed and avarice are as old as the Bible, Morty. And the Democrats are experts on that."  

Stanley, I assume you mean Dems are experts on greed, not the Bible.  Some Republicans also know greed, as do some Libertarians.  What's missing in your criticism, is the role of of the players who make policies, appropriations, budgets and tax incentives that perpetuate our fiscal hell. 

Take, the housing bubble, which was enabled by government policies (sorry Morty, mainly Dems and the Fed in my view) when millions of Americans "bought" houses that they could not afford.  That experience is the perfect example of why we are broke as a nation and as a people. We ate too much, drank too much, bought too much, saved too little and then the bill came due. 

Yes, we have a consumer-based economy Morty and it's a giant Petri dish of self indulgence.  An economy so dependent upon domestic consumption strikes me as doomed as ancient Rome.

Our sense of liberty gave way to gluttony and we confuse the two nouns. 

These election outcomes?  Yes the people have spoken Stanley, but will a new majority in power practice sound fiscal principles by telling voters what many of them don't want to hear?  Will tax cuts be matched by corresponding spending cuts?  We'll see what the new Congress tries in January, but I don't believe we can tax our way out of the hole, or depend upon government to be a good steward of the peoples'' wealth.  Nor can the Fed save us by printing cash.  What's the pain remedy?  First we must take some pain.  

Live within our means, keep the dollar strong and responsibly scale back entitlement programs.  Social Security, Medicare, a bevy of state and other federal programs, public sector defined benefit retirement plans, as well as Cadillac health plans are all part of the same problem.  Some austerity measures can kick in now, not in 2025.

As for Mortimer's remorse regarding Mr. Feingold's election  fate, I was pleased but not surprised.  My view on how Russ Feingold devolved as a public servant would take time, but here's a taste...

You called him a Maverick, Morty.  Sometimes yes, but not always when it mattered.  His lonevote against the Patriot Act was pointless grandstanding.  He acted as though he had a monopoly on wisdom and constitutional purity that somehow eluded 98% of the United States Senate (one senator didn't vote on the measure).

Libertarians later rebelled against this Maverick after he voted for his party's stimulus package and Obamacare.  All this and years of inactive legislative performance sunk his boat, Morty.  He fell in love with being a Senator and made an ill-timed dart to the entitlement-loving, Left.  It was too late for him to retreat to the Center. 

I'm done for now, but know this men -- I can still drive to the hoop better than either one of you ever could, although I concede you were both better students. 

Your devoted friend,

John

A fiscal adult -- David M. Walker

Consider the national debt which as a percentage of gross domestic product is at its highest levels since World War Two.  Click here for a real-time depiction of our debt and consider the faith that the rest of the industrialized world has in the United States as a beacon of financial stability. 

What happens when that changes?  Why are some observers more worried about climate change than global economic calamity that is looming in our midst? 

We need more leaders like Mr. David M. Walker.  This post is dedicated to his mission.  Some might think I'm joking when I say that what we need in Congress and the White House right now are accountants.  I'm actually serious.  Mr. Walker, by the way, was an Arthur Andersen partner several years ago. 

We need people who can balance a budget and say "no" and be proud to say no because it is right and just.  The only anecdote for a nation addicted to debt are politicians with the fortitude to say, "You'll be getting less now and you'll wait longer to receive it.  Sorry."

Mr. Walker is willing to accept more tax increases to offset spending cuts than many of us would like to see -- as opposed to demanding proportionally-larger spending cuts.  Yet, I still admire his zeal to reclaim a fiscally-sane America.

David Walker: Wikipedia

I invite you to learn more about him by clicking on this Wiki...

Mr. Barrett's omission

Yesterday morning I listened to a radio program that sounded like a Town Hall celebration of Tom Barrett's Gubernatorial bid.  It was broadcast live from the University of Wisconsin - Milwaukee. 

I couldn't listen to the whole program but the thirty minute portion I heard included Mr. Barrett's diatribe against Wisconsin's $2.7B structural deficit and his plan to end it which includes tax increases on "the wealthy."  Here's what bothers me...

Not once in the first thirty minutes of Mr. Barrett's monologue did I hear a single reference to a spending cut.  If I missed such a bombshell in the remaining minutes of the program, please let me know.

Kapenga for Wisconsin's 33rd Assembly District

I'm supporting Mr. Chris Kapenga for this seat because we need a hard-nosed fiscal conservative now more than ever.  If only we could have more accountants in the state legislature.  

Here's something I found on Mr. Kapenga's website:

By William J. H. Boetcker

•You cannot bring about prosperity by discouraging thrift.

•You cannot strengthen the weak by weakening the strong.

•You cannot help little men by tearing down the big men.

•You cannot lift the wage earner by pulling down the wage payer.

•You cannot help the poor by destroying the rich.

•You cannot establish sound security on borrowed money.

•You cannot further the brotherhood of man by inciting class hatred.

•You cannot keep out of trouble by spending more than you earn.

•You cannot build character and courage by destroying men's initiative and independence.

•And you cannot help men by doing for them what they can and should do for themselves.

Mark Stoiber R.I.P.

One week ago today, I was shocked and saddened to read the obituary of Mark Stoiber.  Mark Stoiber's cause of death was a Pulmonary Embolism. 

Mr. Stoiber was Co-Founder and President of The Sleep Wellness Institute, a successful Milwaukee-area operation that helps people with sleep apnea.  He was also a proud husband, father of three children and a man of quiet confidence, patience and intelligence.  Moreover, Mark Stoiber truly cared about others. 

It might be the most cruel paradox of this life, that a good man like Mark Stoiber is taken ten days before his 48th birthday, while countless bastards live peaceably into their nineties.  Why?  Maybe when we meet the Creator, we'll learn why.  

Class struggles, debt and happiness

Credit-related causes of the Great Recession included: lax underwriting standards (abetted by government programs and the GSEs), overuse of ARMs (because the borrower couldn't qualify for a fixed rate note), too much cash-out financing and artificially low interest rates.  Yet, the Wall Street factor (i.e. securitization of those obligations and excessive risk-taking) always seems to dominate the debate.  I disagree with that emphasis because:

1) the Wall Street factor already gets most of the attention in the press,
2) regulatory reform for banks is a foregone conclusion,
3) Wall Street's culpability came during and after credit issuance to subpar borrowers, not beforehand. 

It's the third point that is lost on some who look only at the Wall Street role in this unmitigated disaster.  The destruction could only have been possible with easy credit extended to in-over-their-heads borrowers, like our federal government -- that operates the same way -- in the red. 

Even today many journalists treat sympathetically, those homeowners who walk away from their mortgages when the principal amount owed, exceeds the current market value of a property.  That's disturbing.  (Experts say, that between 20 and 25 percent of all outstanding mortgages in this country are under water.)

Author User: Brendel at en.wikipedia.org

Excessive consumer debt and government debt affect the rest of us who keep our promises and pay our obligations.  Yet some debtors and their advocates continue to ply us with excuses.  I have given you examples, but here's another one, which I'll call the Jon Stewart excuse:  You can't fault them because they were just "optimistic" about the future.  (If you're an optimistic borrower with bad credit and thus in need of an empathetic co-signer; please seek out Mr. Stewart.)  I'm genuinely sympathetic to people who suffered tremendous misfortune that led their financial problems.  Examples may include catastrophic medical issues, sudden job loss or sudden death of a primary wage maker.  Their pain was not self-induced.  My belief, however, is that people in those unfortunate circumstances constitute a smaller percentage of the people defaulting on their obligations, than what's portrayed by Left-leaning observers. 

A new book by Arthur C. Brooks called, The Battle: How the Fight Between Free Enterprise and Big Government will Shape America's Future may add some perspective.  The book is reviewed by Matthew Continetti in the June 21 issue of National Review.  Mr. Continetti, an associate editor at The Weekly Standard in his article titled, "The Happiness of Pursuit" notes that Dr. Brooks thinks 30% of the American public believes "...free enterprise is unfair and the government ought to do more to ensure equal outcomes" and that wealth redistribution is a justifiable anecdote.  

Continetti notes that conservatives believe "redistribution is inefficient, or unfair to those from whom the money is taken, or a recipe for unlimited government".  He notes that Arthur Brooks has additional reasoning why redistribution fails in practice.  Based upon what Continetti calls an "abundance of empirical data" Brooks believes feelings of low self-worth, not inequality, actually make people unhappy and giving a man a fish not only won't help him fish, it won't help him feel good about himself either.  Brooks believes that earned success which he defines as, "the ability to create value honestly" is a proven prescription for happiness.

According to Brooks, 30% of Americans believe that wealth redistribution is justified.  That figure stuns me.  Apparently 30% of us do not realize (or care) that continuing down this slope could have apocalyptic repercussions for our current way of life -- a way of life that enabled America to flourish in the first place.  Perhaps despair and envy are the birth parents of all Socialist states.

Blessed again!

Wikipedia image

Another Progressive I've known as long as Mortimer (since childhood) read my last post - I'll call him "Cameron" - and he takes issue with my claim, "Wealth re-distribution is the Excalibur sword of most Progressives."  Cameron feels it is only reconciliation for "30 to 40 years" of growing disparity between the wealthy and the less fortunate.  Cameron's beef is summed up thus: "So John, I have a question for everyone out there that talks about this so called wealth redistribution. Based upon the facts I have cited, why was it okay for that wealth redistribution to go on during the 80's, 90's and into the 2000's, but now it's not when it goes the other way around?"

"Cameron,

Thanks for taking the time to read my last post and share your views.  I appreciate it.

Regarding CEO pay at the S&P 500; I don't feel it's a useful benchmark for a public policy discussion, because by definition, you are citing 500 companies to represent a national employment landscape that comprises over six million private employer companies.  That's hardly a reasonable sample, but let's talk about it anyway. 

(On a side note, I hear large public company CEO criticism often and find it interesting that few care about celebrity compensation like that paid to Oprah Winfrey or Alex Rodriguez - even though their pay dwarfs the average CEO paycheck and they don't create many jobs). 

Vastly undeserved executive compensation occurs to be sure, but it's really a matter for shareholders to deal with, isn't it?  After all, they own the company.  They can sell their shares, vote out the board, start a proxy fight, file lawsuits and do any number of things - and many do. 

Similar to any employee that just can't stand his/her Boss; vote with your feet, sue the bastard, etc. but again, let's not make policy for 300 million people based upon a handful of public company executives, lax boards, or apathetic stockholders.

I want to comment on two other items related to prosperity: housing and taxes.

More of our discretionary dollar goes to housing than anywhere else.  We were hardly raised in wealthy homesteads, Cam.  Our parents worked hard, but lived modestly by today's standards.  Perhaps a 1500 square foot bungalow on a postage stamp-sized lot, with two bedrooms, maybe three.  Can we agree on this description?  How do we live today?  More importantly, what has happened to American home sizes over this period you are pointing to? 

Researcher Moya Mason notes in a recent paper that while family sizes have decreased almost 25% over the last 30 years, the size of new houses actually increased over 50%.  This is consistent with my view of Americans in general.  Few of us are able to consume too little and the living standard has improved among all groups, since our childhood.

America has grown primarily through free markets, hard work and innovation - not government intervention.  I recognize this is traditional conservative orthodoxy and some don't like it, but it goes to the core of our disagreement.  You sound as though lower and middle third America have actually been exploited by the "top third."  How so, Cameron?  Think about income taxes (we can talk about taxes on property and consumption another day).

A column in the Wall Street Journal (April 14, 2010, `Spreading The Wealth Isn't Fair') by Arthur C. Brooks of the American Enterprise Institute alerts readers that last year, 38% of all Americans were expected to have zero tax liability.  They paid nothing in federal income taxes.  Under Mr. Obama's budget and other expected tax changes, this group of Americans that pay zip to federal coffers, is expected to grow to 46% in 2011 while the federal government continues to expand. 

Dr. Brooks also notes that according to the nonpartisan Tax Foundation, a full 60% of all Americans "consume more in government services than they pay in taxes."  And what about that top 5% of Americans earning more than the other 95%? These are the folks everyone loves to hate.  Well, they pay over half of all federal income taxes paid.  Yes, 5% of the tax paying public, pays over 50% of all federal income tax collected.

I understand the worry over a concentration of assets, but whether we advocate for the top third, bottom third, or middle third of America - we cannot tax our way to prosperity, or make transfer payments to reverse perceived inequities, unless we want to unwind the very system that facilitated America's rise. 

I'm going to close with part of that Arthur Brooks column:

"...our system is the envy of the world and should be a source of pride.  Generation after generation, it has rewarded hard work and good values, education and street smarts.  It has offered the world's most disadvantaged not government redistribution but a chance to earn their success."   (Words in bold my emphasis, not Brooks'). 

I can't improve on that statement, so I'll leave it there. 

Cam, I know we haven't resolved our debate, but I am excited about your visit this summer after not having seen you for so many years.  Please let me know your expected day(s) in town, so we can block the time and I can make the sauce.

Best,

John"

Blessed with friends on the other side

Wikipedia image

This post contains excerpts from an April 10 e-mail response to a dear friend of mine (edited for emphasis and anonymity). 

“Dear Mortimer,

I’ll say hello to the guys for you and I’ll be thinking about you this evening.

As for politics, yes, we tend to gravitate toward sources that share our views.  However, I also read the New York Times Op-ed pages and watch MSNBC (as hard as those tasks are for me).  I suppose you watch Fox on occasion and I know you read the WSJ – so good for both of us.  We try.  The state-sponsored education you cite that we both benefited from, came largely from our parents' sweat equity – translated into tax dollars – that funded the University of Wisconsin system. True, my friend.  But, I'm not arguing for zero taxation, or zero government involvement in our lives. 

When Progressives argue in favor of entitlement programs, they'll sometimes cite Social Security (under-funded as it is) to bolster their case.  They'll ask, “Well do you think Social Security is a Socialist program too?”  They actually think it’s a great gotcha question for fiscal conservatives.

The bone of contention, gets down to whom you trust with your money.  Progressives wish to give more of it to government because they believe it helps society and folks like me say....

"I don’t trust you because of your history.  Not only do you choke economic growth with your tax and spending policies, but your programs fail and are fraught with waste, fraud and abuse."

Did the Community Reinvestment Act and scores of Democratic initiatives like it enable the American dream for millions of people who otherwise would have been shut out of home ownership regardless of their honest intentions, hard work, and best efforts?   

Of the millions of foreclosures we've seen during The Great Recession, I believe the majority were assumed by reckless borrowers or cheats who had no business assuming those loans.  They lost “their” homes, tanked the market and made the climate more difficult for honest Americans who now - despite their best intentions - remain shut out of the market, perhaps for years.

A primary cause of our trouble was state-sanctioned, predatory borrowing that the Left now calls predatory lending, because their munificent scheme blew up. They brought the system to its knees and they still want to try again and again.  Today it’s health care, tomorrow its education and so on.

Wealth redistribution is the Excalibur sword of most Progressives, Mortimer.  Howard Dean admitted as much recently.  Their vision is not what made this country great and what’s more, all the anger you see out there – overwhelmingly coming from good people  – will not fade away.

I deplore violence and lawlessness and I will not partake in it, but I fear that with the warmer weather and a relentless Pollyanna in the White House, you’ll see things boil over this summer.  I hope I am wrong, but things are going to get uglier because many see their way of life at stake - and a revolution of sorts, is already underway.  How many Americans can take another 2+ years of “hope and change?”   You might be surprised at how palpable the anger and frustration is among the Right and the Center.  That is what I mean about this time being a little different. 

It's not just the GOP or former John Kerry critics -- it's a cross section of Americana.  I believe that their feelings about this administration, stoked by the economy, dwarf the anti-Bush anger we remember.

One last item Morty…

I care about others, you know that and I believe most Progressives have a heart as warm as mine and I include you among them.  I simply view most Progressives as honestly misguided on these matters - and you see me the same way - I get it.  It's a draw.  OK.

We also agree there are Wing Nuts on both sides.  However, if life comes down to helping your fellow man, consider that Conservatives believe government is simply not the way to salvation and its very nature is to give what it does not have, in order to stay in power.  Fannie, Freddie, free Fed money, and the like, it was all government conceived, packaged and delivered.  They just needed a little help from a few reckless Wall Street titans to package and insure the mess, in order to bring the whole temple down. 

But back to helping the less fortunate.  Consider that as a percentage of income, many observers believe Republicans give a larger percentage of their incomes to charity than Democrats.  If you doubt the assertion, check out this link…   I have not made a rigorous study of the question, but I think at best it's another draw, Mort.

Either way, too many Dems pretend that they belong to the party of compassion and that the GOP doesn't care.  That stifles productive debate, so thanks for never playing that nauseating card.

Gotta run...

Your devoted friend,

John“

Mr. Mark Neumann's time for a new goal

Here's to Mark Neumann, a fiscal conservative and an effective legislator with the best interests of the people in mind.  He's the kind of candidate we need to help take back our state from what Ayn Rand called, "the looters." 

The problem is that the Governor's job won't be his.  Mr. Neumann's could instead challenge Russ Feingold for a Senate seat (that should have become his in 1998) and abandoning his Gubernatorial ambitions.  The reasons are...

• The Walker forces are too strong.  He's better funded, has majority support of the party leadership and the GOP rank and file.
• Mr. Walker has a very real chance of beating Mr. Barrett - you could cast more momentum his way, by throwing your support to the Walker campaign.
• Neumann is the only still credible candidate with Washington experience and a chance to beat Feingold.  
• He lost to Mr. Feingold by a slim margin last time around.  Feingold and other stalwarts in his party, are more vulnerable today.  

So, Mr. Neumann, be a pragmatist and do what's best for us.  You will not win the September primary anyway.  There is still time to displace Mr. Feingold, but you must change horses....soon.

Kanjorski & Armey - a worthy dual.

This morning, while watching CNBC's Squawk Box (as I frequently do while dressing for work), I was struck by a welcome reminder that civility and reasoned political discourse still exist.

Democratic Congressman Paul Kanjorski and former Republican House Majority Leader Dick Armey debated.  The issues and the exchanges mattered less to me than the tone and outcome of the segment. 

Neither man gave much ground, but neither fell prey to stupid sniping or demagogic interruptions while the other man spoke.  Honest officials can put forth opposing views without acting like vicious morons.

I don't know if it is because Mr. Armey and Mr. Kanjorski were reared in an earlier era, or if actual maturity comes to one later in life.  All I know is this: Joe Wilson rants and Keith Olbermann types do us no good.  

Torinus & Geanakoplos

Today, while viewing old e-mail on a frosty Sunday, I came upon a message I sent August 16, 2009 to Milwaukee columnist and entrepreneur, John Torinus.  Mr. Torinus has some terrific ideas about creating fiscal health and opportunity here in the Badger state.  However, I was piqued by something in his column last summer and I wrote to him:

"John,

While I agree with 95% of the column, the notion – apparently advanced by John Geanakoplos -- that the government ought to force “a write-down of principal on sub-prime home loans that are under water” is wrong. 

I recall hearing one of your presentations on healthcare and the insurance plans of yesteryear which offered no incentive to control costs (as opposed to high deductible plans many of us now have). You likened the situation to a 10 cent Martini night that you observed as a young Marine. Such arrangements, you reminded the audience, just might lead one to be “over-served.”

Well that’s precisely, the story of most sub-prime borrowers – they were over-served and just as no one forced you to drain too many martinis, no lender could force someone to buy more home than they could afford.

Of course, the rest of us who behave responsibly with our health and wealth, pay the price for those who don’t, but that’s fodder for another column.

To keep sub-prime borrowers in "their" homes - the ones with jobs anyway who may just need a little time - there are better options like converting them to renter status, interest only payment extensions, etc. But write down the principle? No. Doing so abets irresponsible behavior instead of suppressing it.

Tougher mortgage underwriting standards have already taken hold because far too many people, left to their own devices, will drink from the trough until they burst."

Noonan, Isaacson and Caro on Zakaria's program

It was quite a panel assembled today on Fareed Zakaria's Sunday cable program.  Mr. Zakaria typically focuses his program on foreign affairs, but today he turned his sights to the domestic political challenges of the Obama administration.

It was sort of a "Where did he go wrong and what should he do now?" theme addressed by three fine writers - Walter Isaacson, Peggy Noonan and Robert Caro. 

Mr. Caro asserted, "If Obama backs away from healthcare, he will have lost his ideals." 

On a personal note, I am a huge fan of Mr. Caro's work on LBJ.  (I wish he'd complete his book on the final years of Johnson's life soon.)  However, some might take exception with his reference today, to the "fifty million" Americans without health insurance, for two reasons. 

First, many tend to use interchangeably, the notion of "care and insurance" as Mr. Caro did, which obscures the debate. 

Second, the "fifty million" figure needs to be deconstructed and put it into perspective for a nation of 308 million people.  When one looks at "the number" which appears to be closer to 45 million than 50 million, and subtracts from it, the number of people falling under one of the following conditions:

• eligible for free or heavily subsidized health insurance, but won't take it
• takes free or heavily subsidized health insurance but reports to census takers they have no insurance
• can well afford traditional (non-subsidized) insurance, but chooses not to buy it
• are not American citizens

. . . one ought to reduce the 45 (or 50) million number, by at least 30 million people according to an analysis by former White House economic adviser, Keith Hennessey.  What remains, is the number of uninsured we have a duty to worry about and help, but that number approaches 15 million people, not 50 million people.

Perhaps we need not nationalize 1/6th of our economy against the wishes of most Americans to produce a policy that does nothing to lower costs.  Market reforms, tort reforms, increased patient responsibility and other measures could lower costs and improve the system.

Walter Isaacson (author of a critical but engrossing biography of Henry Kissinger) may have made the most practical prescription on today's program when he concluded, "The country is best governed and transformed from the center."

In time we'll know if Mr. Obama will heed this advice and succeed, or choose to double down on the current course.

Milwaukee's fiscal woes won't be solved by Dems' press releases

Published 1.15.2010 at Examiner.com

The primary reason I decided to support Scott Walker's bid for Governor last year is that he is one of the few state pols who "gets it." The "it" in this case -- is fiscal sanity.

I make no claim of neutrality, so when a Web article from the state Democratic machine came into view yesterday, I was naturally skeptical. The title alone was hair-raising, "Inmates Released, Public Safety Plans Cut: "Patchwork" Walker's Latest Hypocrisy Exposed by Political Ally"

The "Political Ally" referred to is Milwaukee County Sheriff, David A. Clarke Jr. -- another leader who also understands how to operate within his means.  My word, I wondered, what had County Executive Scott Walker done? The piece issued by the Democratic Party of Wisconsin, references, "...a scathing letter to Walker" from Sheriff Clarke.

In the first place, the Sheriff's letter was addressed to several County supervisors and Mr. Walker, not solely to Mr. Walker, as the article implies.

Secondly, when the sum and substance of this piece didn't square with my own understanding of Mr. Walker's views, I looked to his Communications Director for Mr. Walker's official positions, which were described thus:

"The budget Scott presented for 2010 DID NOT include furlough days for Sheriff's deputies."

An amendment passed by the members of the County Board applied floating furlough days to everyone and it could not be line-item vetoed. The County Board are the ones that put this into Scott's budget.  

Now, the Sheriff has a series of actions he wants to take as an alternative to furlough days for deputies. Scott supports an alternative and has been working with his office for past few weeks.

Scott Walker WILL NOT and DOES NOT support the early release of inmates as part of an alternative plan. In fact, he would veto such a plan if approved by the County Board.

Instead, Scott will continue to work with the Sheriff's office to avoid the release of inmates - as well as furlough days"

Finally, I contacted Sheriff Clarke's office seeking comment on the "scathing" letter as described in the article in question, and the Sheriff responded through a representative that Sheriff Clarke,

“...is not going to politicize his budget and these conversations should definitely take place between himself, the County Board and the County Executive.”

Perhaps someone forgot to tell the Dems.

A Christmas greeting and a new domain...

I'd like to wish (all seven) readers of this blog, a safe and joyous Christmas season.  This site can now also be accessed at another domain: maddente.com 

God bless you and here's to a healthy and prosperous 2010!

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Rick Santelli is right

Rick Santelli, CNBC

This morning I watched CNBC's Rick Santelli talking from the Chicago Board Of Trade.  His so-called, "Santelli Rant" has been watched on YouTube over a million times and his sentiments today, once again, represent the views of many Americans who believe in living within one's means -- it's how we were raised -- but we lack a microphone.

Rick Santelli was in fine form this morning while debating Steve Liesman.  The topic was banking reform and Mr. Santelli made a case for an elegantly simple cure -- raise the banks' capital requirements. 

Another CNBC commentator astutely chimed in that this is the same risk premium banks require when a homeowner has a marginal credit history -- the bank looks for more cash in the deal -- a bigger down payment to compensate for the risk of default.

Why can't we use the same mechanism to minimize chances of another banking meltdown?  Do we need new federal agencies, reams of new regulations, congressional hearings, class warfare speeches and on and on?  I realize that raising the amount of capital that banks must hold affects their profitability, but maybe it's a reasonable way to manage systemic risk.

Medellín, Columbia and Nixon

I've heard from friends with ties to Columbia, that conditions have dramatically improved across the country, although impressions of that nation's difficult past still linger around the world.  Tonight during Anthony Bourdain's show about Columbia, I watch as he visits Medellín and interviews locals - many of whom suffered enormously during the Pablo Escobar period of the 1980s.  The people appear proud, hopeful, even happy.  Mr. Bourdain says something to a local that reminds me of a rueful Richard Nixon speaking to White House staff in the final hours of his presidency:

"Only if you have been in the deepest valley, can you ever know how magnificent it is to be on the highest mountain."