CPAC Changes


For the second consecutive year, Rep. Ron Paul won the presidential straw poll at the Conservative Political Action Conference (CPAC). This may seem like a minor trend; but, in fact, there are a lot of changes afoot at CPAC — which was an important staging area for Ronald Reagan’s political ascendancy in the 1970s and early 1980s.

Does this mean that the elder Paul is the next Reagan? Probably not. But the changes at CPAC are worth a look.

As usual, pundits in the establishment media focused on some clownish details (Donald Trump’s appearance and some headline-seeking quotes from a couple of collegiate anarchists in attendance) and pasted these to some lazy generalizations about the “stubborn libertarian streak” within the Right. And, as usual, these lazy regurgitations of conventional wisdom missed the more interesting story.

The Campaign for Liberty (CforL) — the political action organization born from the pieces of Rep. Paul’s last presidential campaign — has made a concerted effort to influence CPAC. CforL has developed a partnership agreement with CPAC’s owners, whereby CforL can offer its members discounted tickets to the Conference. This arrangement has worked for CPAC; it’s accounted for between a third and a quarter of all recent attendees.

The arrangement has also helped CPAC achieve some other goals. Since CforL focuses its membership recruitment efforts on people under 25, the deal has broughtdown the median age of the conference crowd. This youth movement is a good thing for CPAC, which could use the change. On this point, I can offer a bit of color to illustrate. About five years ago, a twenty-something Silver Lake Publishing author went to CPAC to promote his book. Overall, the reception was chilly; and, in one panel discussion, he was on the receiving end of some barbs from the execrable Ann Coulter — who dismissed libertarians as “hippies who just want to smoke pot all day.” Her line got a lot of applause from the sensibly-shod audience.

The author was chagrined. Afterward, on the phone, he asked me: “Do these people realize that Reagan was a lifelong reader of The Freeman?”

Anyway, those sensible shoes may be shuffling elsewhere. This year’s CPAC was boycotted by several groups — including the Heritage Foundation, the Family Research Council, the American Family Association — who objected to the presence of GOProud (a gay conservative group) and the growing ranks of Paul supporters. Some of the boycotting groups have announced plans to launch a “family values” conference to rival CPAC.

So be it. Maybe CPAC will become a more open-minded place, with people who remember that Reagan built his political identity on libertarian ideals.

Finally, the arrangement between CPAC and CforL also explains — almost precisely — Ron Paul’s straw poll victory. He was the first choice of 30% of the Conference attendees; and, since CforL accounted for between a third and a quarter of the people in the halls, it’s safe to assume those people danced with the one who brought them.

Second place went to Mitt Romney (in its CPAC coverage, Fox News led with this point and barely mentioned Paul). Third place was a tie between former New Mexico Governor Gary Johnson and current New Jersey Governor Chris Christie. This is a hopeful sign for those libertarians who see Johnson as a better media presence — and, therefore, a stronger prospect in a national campaign — than Rep. Paul. Other popular names (including Sarah Palin and Mike Huckabee, both of whom honored the “family values” boycott) trailed far behind.

Many observers point out, correctly, that presidential straw polls such as CPAC’s get some attention yet rarely predict the nominee accurately. I’m less interested in presidential horse race handicapping than in the ideas being discussed at conferences like CPAC. There was talk in the halls this year about taxes as the worst form of statist coercion.

I’m not sure that’s true. War is worse than taxes. But I’m glad the CPAC attendees were having that discussion — instead of nodding and clapping to the halfwit populism of Mike Huckabee or the empty screeching of Ann Coulter.

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1989 in the Muslim World?


On December 17, Tunisian street vendor Mohamed Bouazizi, driven to desperation by mistreatment at the hands of petty officialdom, drenched his body with gasoline (or paint thinner, according to some accounts) and set himself alight. His death touched off a chain reaction in much of the Muslim world. Protestors took to the streets of Tunis, and their protests culminated in a popular revolution that ousted the country’s corrupt president. The tumult spread to Egypt where, remarkably, a massive yet largely peaceful protest movement succeeded in forcing Hosni Mubarak, who for 30 years had ruled the land like a pharaoh, to step down. At this moment street protests and violence are occurring in Morocco, Algeria, Libya, Jordan, Bahrain, Yemen, and Iran — an upheaval reminiscent of that which swept Eastern Europe after the fall of the Berlin Wall in 1989.

Will the outcome be the same? Are the Middle East and North Africa on the verge of changes that will transform the lives of the people living there? Americans cannot but hope that the early promise of this revolution will be sustained. But I would sound a note of caution. There are reasons to believe that the events we are witnessing represent a false dawn.

That a region-wide conflagration had to come at some point was obvious, though exactly when it would occur no one knew. Demographics (a major youth bulge exists in all the countries in tumult), economics (the region is plagued by high long-term unemployment and soaring food prices), and government corruption provided the tinder that allowed Bouazizi’s fire to spread. Conditions in the Middle East are as backward and absurd as those that prevailed in Eastern Europe in 1989. But Eastern Europe’s problems were in a sense artificial, caused by the warped imperatives of Marxism-Leninism. The problems of the Muslim world are more fundamental.

 Although Iran, the one non-Arab nation involved, has a democratic tradition of sorts (no thanks to the US, which overthrew a democratic government there in 1953), the Arab world does not. Despite the hopes and dreams of foreign policy liberals in the West, there is no evidence to indicate that the Arab peoples have any talent for democracy. Indeed, history seems to show that the reverse is true. Egypt, the political and cultural center of the Arab world, will be the test. Some observers believe that the Egyptian middle class, educated and secular to the extent that it is largely immune to the lure of radical Islamism, will take the nation into a liberal democratic future. But given the abject poverty of the Egyptian masses (living on two dollars a day, as we were reminded again and again during the uprising), and the country’s apparent aversion to liberal values (i.e., free markets and functional democracy), this seems very doubtful indeed. East Germany was pulled up from dictatorship and poverty by rich West Germany, with the latter expending a vast amount of wealth in the process. Who will be Egypt’s mentor and bankroller? The US? Not likely, given the state of our economy and the massive federal budget deficit — not to mention the fact that Egyptians will likely spurn our advice and even our money if any strings are attached. The only nation with enough wealth available to prop up Egypt economically is the kingdom of Saudi Arabia. But we may take it as certain that the Saudis have no desire to see their neighbor become a thriving democracy. The Egyptians will have to pull themselves up by their own bootstraps, something they have never demonstrated an ability to do. Should they fail, the lure of Islamism will be strong and perhaps irresistible.

Eastern Europe’s problems in 1989 were in a sense artificial, caused by the warped imperatives of Marxism-Leninism. The problems of the Muslim world are more fundamental.

Final victory for the protestors in Egypt came about not as a result of their undoubted courage and determination, but because the Egyptian Army refused to stage a Tiananmen Square. That they refrained from doing so was the result, in part, of US “advice” to exercise restraint. The American and Egyptian militaries have maintained close ties since the 1970s. Egyptian officers attend US military schools and training courses, and Egyptian forces are equipped with US weapons. The relationship is so close that the US has permitted production of the M1 battle tank on Egyptian soil.

The US, therefore, has leverage with the Egyptian military. At the same time, we must listen to what that military says, for maintenance of the 1978 Egyptian-Israeli peace treaty remains the top priority of US policy in the Middle East. Egypt is the irreplaceable linchpin of America’s Middle East strategy. If the transition to democracy in Egypt fails from the outset or is derailed by democracy’s inability to cope with the country’s massive economic and social problems, look for the Egyptian army to take a hand. And don’t be surprised if the US backs any action the army may take, even if it comes to the establishment of a new dictatorship. The US must retain Egypt within the orbit of its influence, or find its entire Middle East policy ruined.

There remains a third possibility beyond a successful transition to democracy or a reversion to military dictatorship — a recurrence of the events witnessed in Iran in 1979. This possibility has been pooh-poohed by some experts, who are convinced that the Muslim Brotherhood (founded in 1928 and after the army the largest and best organized actor in Egypt) is neither strong enough nor willing to impose an Islamic regime. The Brotherhood itself has done much to dampen fears, denying that it harbors ambitions to remake Egypt and even going so far as to promise not to field a candidate in the next presidential election. But consider this: on February 18 the radical Sunni cleric Sheik Yusuf al-Qaradawi, who had been forbidden to preach in Egypt for 50 years, and who supports attacks on both Israel and US forces in Iraq, spoke to over a million people (as estimated by the New York Times) gathered in Cairo’s Tahrir Square. He exhorted them to demand of the army that it clear out all holdovers from the Mubarak regime and prepare the way for a new government forthwith. And he urged Egyptians to keep up the pressure until all their demands are met.

Needless to say, such a forcing of the pace will lead to disappointment, more protests, and perhaps a move by the army to “restore order.” Already the army has warned that the country must get back to work; indeed, anything like permanent revolution in Egypt will mean bankruptcy for the Egyptian state. If chaos rather than order results, and the army begins to disintegrate, with conscripts deserting or joining the ranks of the Brotherhood, nothing will stand between the Islamists and their achievement of power in the state. And an Islamist regime would undoubtedly, sooner or later, turn Egyptians’ frustrations outward against Israel and the US. The US would then be effectively shut out of the Middle East (unless it could somehow maintain a precarious position on the Arabian peninsula), while Israel, already facing the demographic challenge of a Palestinian birth rate far higher than that of its Jewish inhabitants, would find itself surrounded once again by hostile states, now motivated by religious fanaticism. One can play out this scenario in various ways, none of which ends well for the US or Israel.

There is no evidence to indicate that the Arab peoples have any talent for democracy.

To the west of Egypt lies Tunisia, the birthplace of revolution, and its neighbors Libya and Algeria, both of which have experienced major unrest. Libya is to an extent a special case, being a collection of tribes rather than a true nation state. As of this writing civil war is raging there between supporters of the regime and rebels. Even the armed forces are divided. It is difficult to predict a winner at this point; however, the longer the fighting continues, the more the possibility of radical Islamists gaining a foothold increases. Recall that in the 1990s Islamists won free elections in Algeria, only to be prevented from taking office by the army. Throughout North Africa the armed forces are the main, or sole, bulwark against radical Islamism. Even in Tunisia, which thanks to French influence has what most of us would regard as a normal attitude toward alcohol and sex, riots have broken out in which fanatical Muslims sought to close down brothels and ransack bars.

But North Africa west of Egypt remains, for the US (though not Western Europe), a sideshow. It is to the east, in the oil-rich Persian Gulf region, that events of world-historical importance are being played out. The principal centers of events here are Iran and, surprisingly, tiny Bahrain.

Iran of course is the other great and ancient civilization besides Egypt in the Middle East. It has more of a democratic tradition than any country south of Turkey, a sizable middle class, and the potential to build a thriving economy based on more than its immense oil and gas reserves. Its peoples are not Arabs but belong to various ethnic groups, with Persians making up a slim majority. The vast majority of its citizens are followers of the Shia sect of Islam, whereas in Egypt the people are Sunni. Since the overthrow of the Shah in 1979, Iran has been under Islamist rule. The Iranian revolution was a delayed reaction to the Anglo-American coup of 1953, which overthrew a democratic government and restored the Shah to power. But for that cardinal Anglo-Saxon sin, Iran might today be a rock of pro-Western stability in one of the most important regions of the world. Instead, it is the West’s most dangerous adversary this side of China.

The tide of history is undergoing a major turn. The whole edifice of Western and especially American policy in the Middle East is crumbling.

In 2009 pro-democracy activists took on the Iranian regime after an election that was widely (though not universally) perceived as fraudulent. They were crushed. In the wake of Egypt, street protests once again sprang up. It is believed in some quarters that these protests mark the death knell of the Islamist order in Iran. On the February 20 edition of Fareed Zakaria’s CNN talk show, the ubiquitous (and apparently immortal) George Soros declared that the Iranian regime would be swept from power within a year. This seems to me a fundamental misreading of the situation. The Revolutionary Guards Corps, the real power in Iran, is as entrenched as the People’s Liberation Army in China. It has the means to crush any popular revolt, and will do so.

The uprisings in the Arab countries should be seen as anti-Western and anti-American (for who supported the autocrats? and who will be blamed if the revolutions don’t deliver democracy and prosperity?), and therefore helpful to the Iranian cause. Iran will reach out to Islamists in the Arab world with a message of unity against the common enemies, America and Israel. Such an appeal will have a potent effect on people looking to blame their problems on malevolent outside forces. In February, for the first time since the overthrow of the Shah, Egypt allowed Iranian warships to pass through the Suez Canal (something Egypt could not legally prevent in any case, but nevertheless a definite straw in the wind).

Watch Bahrain to see which way the tide turns. This small Persian Gulf nation has a Sunni ruling family but a majority Shia population. So far, the protests there have been contained, but if the Shia chase out the rulers, Iranian influence will be at the very doorstep of Saudi Arabia. (Saudi Arabia’s Eastern Province, where the oilfields lie, is connected to Bahrain by a causeway. And its population is overwhelmingly Shia.)

Throughout North Africa the armed forces are the main, or sole, bulwark against radical Islamism.

The Saudis are very, very nervous. They have been urging the Bahrainis to take a hard line with the protestors, while at the same time announcing new giveaways of money for the average man in their own country. How secure the House of Saud really is remains to be seen, of course, but I would point to the fact that more jihadists come out of Saudi Arabia than any other Arab country. If Bahrain goes, and a Sadrist, pro-Iranian regime emerges in Iraq (as may very well happen in time — see my January 27article, “The Return of Moktada”), Saudi Arabia is probably doomed. At a minimum, the Eastern Province and its oil riches will be the target of Iranian pan-Shia propaganda and subversion. How the Saudis and the US will cope with such a situation appears problematical to say the least.

Even if the pro-Saudi ruling family holds on for the time being in Bahrain, one cannot but think that the tide of history is undergoing a major turn. The whole edifice of Western and especially American policy in the Middle East is crumbling. The majority of the peoples in the region have no love for us, or any strong interests in common with the Western world. We are witnessing not a liberation of the peoples as in 1989, but the end of a neocolonial epoch that began with the overthrow of the Ottoman Empire in World War I. In terms of economic impact, and particularly regarding energy, this will have a profound effect on an America already suffering from severe recession and catastrophic fiscal problems. And the effect on Israel will be even worse.

The history of revolution in countries with little or no tradition of self-government is instructive. Moderates overthrow oppressive autocrats, only to be removed by more ruthless and better organized actors — actors who are invariably more oppressive and murderous than the original autocrats. Robespierre, Lenin, Mao, Khomeini are the winners; the moderates are exterminated and the people are worse off than ever. When possible, popular discontent is then deflected upon an external enemy, as when the French Revolutionary armies swept over Western Europe. Such a future may await the West in the Middle East.

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Cuba, While Collapsing


On January 14, President Obama announced that he would issue an executive order loosening US travel restrictions and remittances to Cuba. Though the administration has yet to spell out the details of the change in policy, several areas have been targeted.

Students seeking academic credit and church groups traveling for religious purposes will now be able to visit the island. But it’s the broadening of the definition of “cultural” groups permitted to travel to Cuba that could really open up the island to US tourism — depending on exactly what the new guidelines allow. The indications, according to Arthur Frommer, a travel guide writer, are that these, if not broad indeed, will be fuzzy enough to allow the entire head of the camel to slip into the tent. Additionally, authorized charter flights to the island will be able to depart from any US international airport equipped with proper customs and immigration facilities. Right now, only LAX, Miami, and New York City can offer flights to Cuba.

Predictably, Republicans reacted skeptically — or unfavorably. Hence, Obama’s end-run around Congress. But the reformed Cuban American National Foundation, once the hardest of hardliners, welcomed the proposal, stating that “it’s going to help the interaction between regular Cubans and US citizens; it’s going to help Cuban people inside the island to gain independence from the Cuban government, especially now that roughly a million will be without jobs” — a reference to Raúl Castro’s decision to reduce the government workforce.

Bribery has become endemic. It is, in effect, an institutionalized way of getting things done and maximizing foreign exchange.

Right now, because of currency transaction restrictions, cash is king, which means that US visitors must lard themselves with reams of the green stuff to last their stay — a situation vulnerable to scams and ripoffs. Luckily, Cuban moral standards in the crime-against-US-tourists realm have not depreciated noticeably. But they have snowballed in Cubans’ relations with their own government, an area in which there does seem to be a convoluted method to this madness.

US State Department memoranda, recently leaked by Wikileaks, between Washington DC and the US Interest Section (USINT) in Havana indicate that bribery — high, low, and everywhere — has become endemic. It is, in effect, an institutionalized way of getting things done and maximizing foreign exchange.

The leaks themselves, unlike some Iraqi and Afghan communiqués, are definitely not sensitive. In fact, ever since the profoundly anti-Castro James Cason became our “ambassador” in Havana in 2002, the USINT has — as an official policy position — decided to pour sugar into the Castros’ gas tank. It wouldn’t surprise me if our mission welcomed the leaks. According to the USINT’s website, “The objectives of USINT in Cuba is [sic] to promote a peaceful transition to a democratic system based on respect for rule of law, individual human rights and open economic and communication systems.”

The most recent propaganda war began in the late 1990s, when the Cuban government erected a billboard in front of the mission with a cartoon revolutionary shouting to Uncle Sam, “Señores Imperialistas ! No les tenemos absolutamente ningún miedo!” (Messrs. Imperialists! We have absolutely no fear of you!”) This was followed — during the Elián Gonzales case — by the building of the Jose MartíAnti-Imperialist Plaza just east of the mission, where rallies, protest meetings (particularly targeting US policy), and concerts are held. At first, the USINT pulled its punches by displaying innocuous Christmas figures of Santa Claus, Frosty the Snowman, and a sleigh — censored symbols of a past era. But then, in January 2006, the USINT unleashed the full weight and measure of American creativity. That month, a scrolling electronic billboard in the windows of the top floor of the mission began displaying a quotation by George Burns: “How sad that all the people who would know how to run this country are driving taxis or cutting hair.”

Ever since the profoundly anti-Castro James Cason became our “ambassador” in Havana in 2002, the USINT has — as an official policy position — decided to pour sugar into the Castros’ gas tank.

The Cuban government responded with a huge protest march and the erection of a large number of flagpoles flying black flags with white stars, in a vain attempt to shield the billboard (which brings to mind the old Cuban saying about the fool who tries to deny reality: “You can’t cover the sky with one hand over your eyes”). There was also a Granma International editorial condemning the billboard as “the systematic launching of the crudest insults of our people via the electronic billboard, which, in violation of the most elemental regulations of international law, they think they can maintain with impunity on the façade of that imperial lair.” Apparently, George hit the funny bone again.

Cuban corruption, according to the leaked communiqués, includes bribery, inappropriate “tips,” illegal commissions, influence peddling, graft, embezzlement of state resources, and every other sort of unauthorized expedient used to gain advantage — from the highest levels of the bureaucracy, to ordinary members of the Cuban Communist Party, to the police, the security organs and anti-corruption watchdogs, to professionals of every stripe, right down to the average citizen navigating the reefs of Cuban quotidian life.

Many of the cables refer to illegal commissions either paid to fictitious third parties and deposited in foreign banks or paid openly to the Cuban concessionary and deposited in open accounts. One memo, quoting a Swiss businessman, says, “Like any other place in the world, a million dollar contract assumes $100,000 in the bank [as commission to the Cuban provider].”

If planning to visit Cuba, bring lots of cash — or blue jeans, perfume, soap, spices, sporting and electronic equipment, whatever we usually take for granted in a free society.

A Cuban told the USINT political advisor that “some entire government departments are run as, in effect, mafia fiefdoms. The director of the state bread distribution department placed friends in central hubs and now controls the entire chain of state bakeries.” Along these lines, many of the state jobs most susceptible to skimming, graft, or rent seeking are available only on a commission basis from the functionary in control. As another memo stated, “For example, a position with access to gasoline can cost thousands of dollars because it would permit the beneficiary to traffic in the combustible. Employment in the tourist sector, with access to its tips, can cost hundreds of dollars. A job with Cimex (the import/export bureau) would cost more than $500.” Government departments in charge of transport, construction, health, and food distribution are thoroughly suborned and maintain parallel black markets in lumber, cement, paint, meat, drugs, and many other goods.

Another cable cites the case of a woman who admitted to having her teeth fixed “paying hard currency to a clandestine dental clinic, run by dentists from the Ministry of Health and furnished with equipment stolen from the state.”

Michael Parmly, chief of USINT from 2005 to 2008, writes that the police “are famous for taking bribes. They’re so corrupt that the government replaces the entire force with new recruits from the eastern extremity [rural backwaters] of the island periodically. With time, the rookies become as corrupt as the old hands and they need to be replaced with a new crop.”

A previous Spanish ambassador characterized the situation to the USINT in this way: “Corruption is necessary to survive. When in the majority of Latin American countries a corruption scandal consists of one person stealing $11 million, in Cuba it’s that each one of the 11 million Cubans steals one dollar.” In 2009 the USINT provided this summary to Washington: “Corruption in Cuba is an accepted tool of survival. Cubans average an income of $18 monthly, and the security organs are well aware of it.” Madrid’s El País adds,Nevertheless, conduct considered corrupt in the United States, such as conflicts of interest or influence peddling, is business as usual in Cuba. The authorities tolerate corruption up to a certain point, but for serious corruption they respond with severity.” Makes one wonder how they define “serious.”

Now corruption is not normally part of the libertarian theoretical arsenal. Nonetheless, in this case (and probably in others as well), I will attempt a defense of the practice.

First, it is a relief valve for the constraints placed on normal market activities by unrealistic regulations — especially when they are “regulations without representation.”

Second, “corruption” is more understandable within certain frameworks and traditions. Modern political systems that evolved from Roman tradition — a tradition based less on ideology than on personal loyalty, patronage, and nepotism — are often perceived as corrupt by people nurtured wholly within Enlightenment political tradition. The Roman tax collection system is particularly instructive. Government collected taxes by selling the position of tax collector to the highest bidder. The price was determined by an estimate of the taxes that could be collected. The revenue agent then pocketed whatever he could garner from taxpayers — that was the return on his investment.

The Castro regime attempted to shift the traditional order — extant under Batista and his predecessors, albeit modified considerably over time — to an ideologically-based system. The draconian approach failed. Now, if anything — and in spite of many Cubans’ naïve admiration for the ideals of socialism — ideologically-based standards have suffered a crushing blow. Damage has been done that will be difficult to reverse when the regime collapses.

Bradley K. Martin, in his account of North Korea and the Kim dynasty (Under the Loving Care of the Fatherly Leader), interviewed many defectors from the hermit kingdom. North Korea has a much worse reputation than Cuba. It is surprising, therefore, that the North Korean defectors’ attitudes have much in common with Cuban attitudes. For one thing, reverence and admiration for Kim the Elder is widespread — for fighting the Japanese and imperialism and for socialist idealism, which the defectors are at pains to reconcile with the North’s economic failure, the primary reason for their escape. Similarly, in Cuba much of the populace still admires Castro’s accomplishments and idealism.

“When in the majority of Latin American countries a corruption scandal consists of one person stealing $11 million, in Cuba it’s that each one of the 11 million Cubans steals one dollar.”

In the course of describing how things get done in North Korea, Martin quotes one defector’s eloquent defense of the country’s widespread corruption: “I feel it’s justified. The official works hard to [fulfill the petitioner’s request], so there should be a payoff for him. Above that official there may be higher officials. This lower official has to work hard to [get his own requests fulfilled], has to pay off higher-ups. I just thought that was the way things were. I thought it was understandable. This system is prevalent throughout society. For example, if I couldn’t make it to the factory one day, I’d see the manager and give him some gifts and ask him to look the other way. In North Korea most bribery involves goods, not money. When my father worked as an official at a county economic committee he received so many ‘presents’ from farmers — potatoes, green onions and so on. If a person receives a present in the form of goods, that’s a ‘friendly present’.”

Conchita, a woman I know, understands. The not-so-recent émigré’s extended family and friends keep trickling into the USA, while she keeps visiting people who are still on the island. Those experiences, and her American dream job, conducting publicity for one of the state lotteries, invest her with an extremely pragmatic attitude to government in all its forms. She cultivates contacts in official and unofficial, high and low places. Her advice, if planning to visit Cuba, is to bring lots of cash — or blue jeans, perfume, soap, spices, sporting and electronic equipment, whatever we usually take for granted in a free society — to facilitate every contingency and make a Cuban’s day.

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Bones Crunch!


Liam Neeson fairly burst onto the big screen in 1993 with his compelling performance as Oskar Schindler, the man who saved over a thousand Jews from Nazi execution, in the Oscar-winning Schindler's List. It wasn't his first film by any means, but it was his first big film, and it garnered him an Oscar nomination for best actor. From there his career turned in the direction one would expect for an Irish-born, classically trained actor with a resonant voice and proclivity for accents. He played characters with stature: Rob Roy, Michael Collins, Alfred Kinsey, Jean Valjean, the god Zeus. He was the voice of Aslan. He also had fatherly, mentoring roles in such films as Batman Begins and Star Wars Episode I.

So how did this stately-but-slightly-sagging, now-middle-aged man suddenly morph into an action figure? A figure who has become a number one draw at the box office?

It started with Taken (2008), a film in which he plays a father determined to rescue his kidnapped daughter. Not an unlikely reach for a man his age — except that his character, Bryan Mills, is a retired CIA agent who is highly trained in combat and espionage. Taken was 10% distraught father's angst and 90% thrill ride, with enough hand-to-hand combat, gunfights, dead bodies, and car chases in a 93-minute thriller to satisfy the most avid video game player. (And that's what many of these new thrillers have become: video games without the controllers.)

From there Neeson has voiced a character in an actual video game (Fallout 3), and fought the bad guys with The A-Team. Now he is taking on a horde of assassins in the new psychological conspiracy thriller, Unknown.

With a more engaging plot than most action movies, Unknown offers a satisfying evening's entertainment. The story has numerous unexpected twists and subtle clues, with enough red herrings to keep even this staid reviewer off balance. Neeson plays Martin Harris, a biochemist arriving in Berlin with his beautiful wife (January Jones) to present a paper at a scientific conference. When his briefcase is accidentally left behind at the airport, he grabs a cab to retrieve it and ends up in the river when the driver swerves to avoid some falling debris. By the time Harris returns to the hotel, after spending four days in a coma, another man has taken his place, and his wife does not recognize him. Creepy men start following him. Cars race through traffic with guns blazing. Bodies crash through walls in the throes of battle. Bones crunch. Bullets fly. Blood flows. Necks snap. And in the middle of it all, Liam Neeson, looking more like Al Bundy than James Bond, is the unlikely action hero.

I don't get it. But I like it.

Editor's Note: Review of "Unknown," directed by Jaume Collet-Serra. Warner Brothers, 2010, 113 minutes.

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“Chutzpah” is a great Yiddish term for nerve — as in having the nerve to ask something outrageous. The classic illustration of chutzpah is a man who murders his parents, then at trial throws himself on the mercy of the court because he is an orphan.

But what word would you use to describe the person who not only murders his parents but consumes their body parts, then goes to an adoption agency in search of new ones? I suppose the best we can do is say he has “hyper-chutzpah.”

This is about the best description possible of Bob King, the new head of the United Auto Workers union. A recent Wall Street Journal piece recounts how King is trying to present the UAW as a helpful partner, deserving of adoption by the workers and management of foreign automakers with plants in the US (mainly located in the right-to-work states).

King’s pitch is pure hyper-chutzpah. He avers, “Our mindset is not adversarial. Our agenda is a positive one of shared responsibility and shared prosperity.” His pitch is part of the UAW’s attempt to unionize the foreign-owned plants, something it has consistently failed to do over the past three decades.

It is doubtful that many workers will fall for this transparently duplicitous pitch. Most workers understand that the UAW has a pernicious history. Yes, it got “great” concessions out of the domestic producers: not just outrageously high compensation packages but unsustainable pension and health plans. Also, the UAW extorted contracts that enabled work rules protecting lazy, drunken, or otherwise incompetent workers, as well as featherbedding — including obscene rules that required workers laid off from any plant that should happen to be closed down to be kept on at full pay, sitting around playing cards in holding tanks.

The UAW has nearly destroyed the domestic auto industry. Two of the three companies it drove to the wall had to be rescued at the cost of tens of billions in taxpayer dollars, a transfer from all of our pockets to the pockets of the UAW thieves. In so doing, it has hurt itself. Its membership, once as high as a million and a half, is now only about a third of that. And if its Fairy Godpresident, Obama, loses in 2012, the next administration will be far less willing to rip off the taxpayers and creditors and give it whatever it wants.

In the face of broad public (and worker) awareness of its destructive behavior in the past, the precipitous decline in its membership over the past few decades, and the rapid deflation of the power of its political ark (i.e., the Democratic Party), the UAW is offering some olive branches. It has backed off from the demand for card check legislation (which would eliminate secret ballots in unionization votes), and is offering to help get the long-delayed free-trade agreement with South Korea though Congress.

All this is like Obama’s recent assertions that he wants to work with business, perhaps lowering regulations and corporate taxes a bit. But in truth, it is all a bunch of BA — bland assurance. It is empty happy-talk by people who despise business and the free market economy in which it thrives. The UAW has permanently crippled our domestic auto industry, handing over a major area of manufacturing, in which we once led the world, to foreign companies. Worse, it has used workers' union dues to finance the election of an endless number of leftist Democratic politicians, who have been crucial in crippling our energy industry, taking over our health industry, and hobbling other industrial sectors as well.

We can only hope that workers and management at the healthy foreign-owned auto companies will give the UAW the cold shoulder it deserves. The nation needs to tell this greedy, soulless, statist, power-hungry, job-killing gang of kleptocrats what Cromwell told the Rump Parliament: “Depart, I say, and let us have done with you. In the name of God, go!”

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More Than Just a Pretty Film


The Illusionist is a lovely animated movie by French filmmaker Sylvain Chomet — a movie that, despite its beauty, has a disturbing message.

Its leading characters are a kindly vaudeville magician and the young working girl whom he befriends. The story is sweet and full of pathos, as the older gentleman sacrifices his own comfort and well being to please the girl. Appropriately, the film is drawn in the soft-edged, old-school style that predates Pixar. Its French pedigree is obvious, from its watercolor backgrounds and exaggerated, non-realistic faces to its impressionistic musical score. The characters communicate with each other through a combination of mime and an odd pseudo-language reminiscent of the way adults speak in the old "Peanuts" TV specials. This adds to the dreamlike quality of the story, although it can be off-putting to those who aren't fans of French animation.

Based on a story by Jacques Tati (1907–1982), the famous French filmmaker, The Illusionist is intended to show the deep father-daughter connection between a lonely old man and an equally lonely young girl. Metaphorically, however, the film offers a powerful, though certainly unintentional, warning look at the relationship between the working class and the welfare class. The magician's relationship with the young cleaning girl begins innocently and sweetly. When her bar of soap slips away from her while she is cleaning the floors, he picks it up and "magically" turns it into a fancy box of perfumed hand soap, offering it to her with a flourish. She is thrilled. The next day she washes his shirt to show her appreciation, and he "magically" produces a coin from her ear to thank her — the way kindly uncles do when they visit little nieces and nephews. Noticing that the sole of her shabby shoe is flapping wildly as she walks, he buys her a pair of bright red shoes.

Before long the magician's gig at the local vaudeville theater ends, and he must move on to the next town. Without being invited, the girl follows him. When the conductor asks for her ticket, she points to the old man, miming her expectation that he will produce a ticket for her out of thin air. Not wanting to disappoint her, the poor man complies, again with a magical flourish. Throughout the rest of the film the girl stays with the man, pointing to new goodies that she wants — a new coat, high-heeled shoes, a new dress, and a coin from her ear every time they part. The man takes on extra jobs to pay for her increasing demands. He sleeps on the couch so she can have the single bedroom in his tiny apartment. Sadly, the girl never catches on to what is happening to the man. You can probably guess where this leads. Small- time magicians, like golden geese, eventually give out.

The film offers a powerful demonstration of what has happened to a whole generation of people who have grown up under the welfare state. They have no idea where money comes from, or how to earn it. They turn to the government for housing, food stamps, education, medical care, and even entertainment in the form of parks and recreation. They seem to think that money can appear out of thin air, and that people who work owe them all the goodies they want. Like the man in the film, tax-paying Americans are becoming threadbare and exhausted. The demands on them are too many, and they're tired of not being appreciated for meeting those demands. At some point they are going to stop working — also like the man in the film. What then?

A friend who teaches middle school in the Bronx asked her students to write an essay about what they want to be when they grow up — pretty standard fare for a middle-school essay. One young man wrote about going to college, becoming a lawyer, and representing clients in court. "I'll make a lot of money, and I'll wear nice suits and carry a briefcase," he dreamed. But he ended his essay with this chilling observation: "If I do that, I'll probably earn too much money and I'll lose my housing and food stamps. So maybe that's not such a good idea." What a self-defeating decision! Yet I see that idea in practice every day as I work with people from Yonkers and the Bronx. They are so afraid of losing their tiny apartments in crumbling buildings on potholed streets in seedy neighborhoods that they won't even consider moving to a different state with a lower cost of living, where they could get a job and provide for their families themselves.

How surprising, that the demise of the American dream would be so skillfully and artistically presented in the form of a French animated film. It is well worth sharing with friends as a cautionary tale of pending disaster.

Editor's Note: Review of "The Illusionist," directed by Sylvain Chomet. Pathé-Django, 2010, 90 minutes.

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That Would Be "Oops!"


Here’s a wild and amazing bit of news: the Wall Street Journal reports that after a ten-month investigation of the mysterious cases of unintended acceleration reported in Toyota vehicles last year, the National Highway Traffic Safety Administration (NHTSA) (with the help of NASA engineers) has discovered the cause of these events. The vast majority of them were . . . driver error!

Yes, after all the hysteria whipped up by the media and Congress — a hysteria that had the hidden goal of harming Toyota and helping the recently nationalized GM — it turns out that the most common problem by far was that drivers were hitting the accelerator pedal instead of the brakes. Yes, in some cases it was sticking accelerator pedals and improperly cut floor mats that were at fault — and both defects were quickly addressed in a recall by the company — but driver error was the big problem.

In short, Toyota suffered what Audi did many years ago: a media-driven hysteria for something primarily caused by drivers handling their vehicles improperly. In 1986, a number of people sued Audi, claiming that their cars had inexplicably accelerated, despite the brakes being depressed. A wave of prejudicial publicity followed. In the end, however, the NHTSA found that the majority of cases were clearly caused by the drivers pressing the accelerator while thinking they were hitting the brake.

In 2010, leading the charge in bashing Toyota was the Democrat-controlled Congress. Most of the congressmen sitting on the committee that investigated Toyota were recipients of UAW campaign money. Even more out front was DOT head Ray LaHood, who opined at the time that Toyota owners should immediately stop driving their cars.

Questioned about the new report, the now-discredited LaHood got annoyed and refused to use the phrase “driver error.” But he was forced to concede: “We feel that Toyotas are safe to drive.”

This simply will not do. LaHood has been proven unfit for his position. He deliberately hyped a problem the cause of which he was utterly clueless about, scaring the hell out of a lot of consumers, and costing Toyota a fortune in tangible and intangible assets.

If he had even a semblance of dignity, LaHood would resign immediately.

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Assessing the Bailouts


Here are some libertarian warnings about the government rescue of General Motors:

“The current restructuring plan calls for the U.S. Treasury Department to have controlling interest in General Motors, which amounts to absolute nationalization. In GM's headquarters in Detroit there is a cluster of bureaucrats from the government's task force telling GM how to run its business. . . . Furthermore, the White House fired General Motors Chairman and CEO Rick Wagoner. When the executive branch intervenes in a private business and ousts management, bailout or not, it is a staggering violation of the American ideal of free enterprise. This sets a precedent for unlimited government trampling over the private sector. On March 30th, Obama said, ‘Let me be clear. The United States government has no interest in running GM. We have no intention of running GM.’ If that's the case — and we know it's not — then why scoop up majority ownership?” (Karen DeCoster,, May 23, 2009)


“Will GM be run as profitably and efficiently as Amtrak? Will GM be paid not to produce, like the agricultural sector? Will it feed into an economic bubble like Fannie Mae and Freddie Mac? Will it boast the negligible oversight and waste of the so-called ‘stimulus’ package? Will it feature the fiscal irresponsibility of Social Security? Or will we see the runaway costs of Medicaid?” So many options. (David Harsanyi,, June 3, 2009)


“GM’s bankruptcy announcement today . . . might well be remembered as the company’s last act of capitalism. If GM emerges from bankruptcy organized and governed by the plan created by the Obama administration, it is impossible to see how free markets will have anything to do with the U.S. auto industry. With taxpayers on the hook for $50 billion (at a minimum), the administration will do whatever it has to — including tilting the playing field with policies that induce consumers to buy GM or hamstring GM’s competition or subsidize its costs — in order for GM to succeed.” (Daniel Ikenson, Cato@Liberty, June 1, 2009)


“The more the Treasury lends, the more GM will come to be Government Motors. In Obama's America, that will mean becoming a development project for electric cars, plug-in hybrids, or whatever it is the politicians want. The result might be wonderful, but the history of state-controlled companies suggests boondoggles are more likely. The best thing is to let GM do what failing companies have always done: reorganize if possible, liquidate if necessary. . . . Let it go, and let investors put their money where the odds are better.” (Bruce Ramsey, The Seattle Times, April 1, 2009)

That last excerpt is, of course, by me. I didn’t condemn the firing of Rick Wagoner, because I would have fired him, too. But on the main point — that so much government money risked turning GM into a money-losing government pet — I agreed.

It hasn’t happened that way. As I write, the new GM has had three quarters in the black, the latest one earning five and a half cents of operating profit on each dollar of sales. That’s quite respectable. In November 2010, GM became a public company again with a stock offering. GM planned to offer the stock at $26 to $29, depending on the market, but demand was so strong that it sold the shares at $33; and as I write, the stock is trading above that. The stock offering reduced the Treasury’s stake in GM from 60.8% to one-third. If the US government can sell its remaining stock at $53, it will break even.

Chrysler hasn’t done as well, but it is also in the black, and looks like it will make it.

Of course, disaster could yet strike and turn the pessimists into prophets. But let’s be honest: so far, the affair has turned out much better than we feared. We ought to know why, especially if we expect to oppose the next bailout.

One place to start is Steven Rattner’s book, Overhaul, subtitled An Insider’s Account of the Obama Administration’s Emergency Rescue of the Auto Industry. Rattner, 58, was President Obama’s “car czar” on the GM and Chrysler rescues. Rattner is a Wall Street guy; he was a founder and partner of the Quadrangle Group, a leveraged buyout firm. Before that he was a reporter for the New York Times, which explains why his book reads so well.

Of course, you are free not to believe his account. I haven’t seen it contradicted, so I take it at face value. Reasons may come along to change that. So far they have not.

I don’t share Rattner’s politics. He is an Obama man. He has raised money for Democrats, and his wife Maureen is a former national finance chairman of the Democratic Party. He says in the book that he is a Democrat because “the Republicans had favored the rich at a time of growing income inequality, abandoned fiscal responsibility, and held unfortunate positions on social issues such as a woman’s right to choose abortion.”

The GM affair has turned out much better than we feared. We ought to know why, especially if we expect to oppose the next bailout.

As “car czar,” Rattner was leader of Team Auto, a group of people, mostly from outside government, whom he recruited. His bosses were Larry Summers, President Obama’s chief economic adviser; and Tim Geithner, Obama’s treasury secretary. Rattner says his task “was not designed to further a particular economic theory,” but was strictly to save those parts of GM and Chrysler that could be made economically viable. He says that in his meeting with Obama on March 26, 2009, the president told him, “I want you to be tough and I want you to be commercial.”

Rattner focused on GM. When his work began, in January 2009, the company already had been given billions by the Bush administration and was burning through it at a bonfire rate. The economy was in panic. The Dow Jones Industrial Average was shriveling to 6,600, the figure it would touch in early March. GM was no longer a viable enterprise. On his judgment of GM, Rattner sounds much like the libertarian accountant Karen DeCoster, who had been saying on for several years that GM was an ongoing industrial disaster.

Rattner is no partisan of unions; he recalls his days at the New York Times when the Newspaper Guild defended featherbedding and incompetents. But he does respect unions, and he doesn’t blame them for what happened at GM. It’s management that runs a company. As a leveraged buyout guy, he had expertise in firing, hiring, and evaluating managers — and at GM he was appalled by what he saw and heard.

“From Wagoner on down,” he writes, “GM seemed to be living in a fantasy.” To executives, the problem was entirely the recession, not the GM product line or the way the company was run. GM management’s idea, Rattner says, “seemed to be to trim only what was easily achieved and absolutely necessary, and use taxpayer dollars to ride out the recession.”

But GM had been bleeding market share continually for 33 years. After rebates, its cars sold for thousands of dollars less than their European and Japanese counterparts — a market measure of the people’s esteem for the products. For management not to see that was a kind of sickness. GM had a culture of excuses, of institutionalized failure.

Rattner’s killing comment: “No one at GM thought like an owner.”

Team Auto’s idea was that government money would come only with big changes to make GM viable, including sacrifices by management, labor, bondholders and creditors, and with a major mind readjustment at the top. The place to begin was the CEO.

There was a hullabaloo in the press because the government fired Wagoner. So it had; but the government was the investor, and an investor may put conditions on his investment.

“After nearly a decade of experience as a private equity manger, I believe in a bedrock principle of that business: put money behind only a bankable management team. To my mind, no private equity firm on the planet would have backed Rick Wagoner or GM’s current board. . . . A CEO who leads a company into a state in which its only recourse is a government bailout shouldn’t be in his job.”

And that’s right. There was a hullabaloo in the press because the government fired Wagoner. So it had; but the government was the investor, and an investor may put conditions on his investment. He who pays the jukebox calls the tune.

The critics wanted GM to be put into bankruptcy — either Chapter 11, in which creditors are partly stiffed and the company survives, or Chapter 7, in which the creditors are given the carcass. The critics tended to gloss over the fact that each of these procedures involves the government, in the form of a federal bankruptcy court. Each involves the breaking of private contracts. The difference is that in a bankruptcy the decisions are made by a judge (appointed by other judges) rather than by a politician or direct political appointee. The other difference is that a bankruptcy judge does not have a pipeline to public money.

Those are important differences, but it’s still the government.

An ordinary Chapter 11 would have taken perhaps 18 months, and Rattner says there was no way GM could get debtor-in-possession financing from a bank for such a period. Wagoner had waited too long, and GM was too weak. Wagoner told Team Auto that once the company was in bankruptcy, he believed nobody would buy its cars, because customers would be worried about warranty coverage. Because of that, Wagoner said, he had done no preparation for a Chapter 11. The warranty problem was real, but this was also a self-excusing argument from a guy lining up for a bailout.

There was a different kind of Chapter 11 called a Section 363. It had never been tired on an industrial company the size of GM or Chrysler. A Section 363 allowed Team Auto, the new investor, to fashion a new GM from the assets of the old, leaving creditors to fight over the bones of Old GM. In that way, Team Auto brought out what Rattner calls “Shiny New GM” in a little more than a month.

Maybe that tells something about bankruptcy. Critics write as if bankruptcy were a fixed thing, like the Ten Commandments. But it is a human institution, and may be changed so that it works better or worse.

In the GM case, the stockholders would get nothing, which is what they would have gotten anyway. The bondholders would get a share of New GM worth about 35 cents on the dollar — an amount Rattner says was more than they would have received in a straight liquidation and therefore too much, because the government wasn’t intervening on account of them. The workers’ medical benefit trust would get a piece of the new company in exchange for releasing the new GM from all of its retiree medical obligations, which, unlike pensions, are not guaranteed by the Pension Benefit Guraranty Corp. The United Auto Workers would get a seat on the GM board. The Canadian government, also investing capital, would get a 12% stake.

Given the choice, taking the equity was the right decision. If you’re going to pay the money, you may as well get something for it.

And the US Treasury would get almost 61%. That was a problem. Contrary to all the muttering about Obama being a socialist, the president didn’t want the government to own GM, nor did any substantial constituency in the Democratic Party. And yet, when the decision came about taking shares of stock, it was this, according to Rattner: “We can either get nothing for something or we can get something for something.”

Given that choice, taking the equity was the right decision. If you’re going to pay the money, you may as well get something for it. The Treasury did, and the result of that decision a year and a half later is that the taxpayers have been made one-third whole, and have a chance of coming out entirely whole.

And compared with things two years ago, that is an economic success.

Rattner wants to say there were no politics involved in these decisions, but he can’t quite do it. The choice to undertake the project in the first place was political. And always there was what Rattner calls “the Washington Post Test”: don’t do anything that you don’t want to see written about in theWashington Post.

But the bounds of the politically possible left a large space, and within this space Team Auto had discretion. Rattner writes, “No one in the Obama administration ever asked us to favor labor for political reasons.” Indeed, one of his chapters is called, “F**k the UAW,” a quotation he attributes to White House Chief of Staff Rahm Emanuel.

Organized labor took its lumps in the rescue — at GM it lost almost one-third of its North American jobs. But it came out ahead of where it would have been with no rescue, and it preserved its pensions and high wages for older workers by pushing pay far down for new workers.

With GM, Team Auto assumed from the start that there was a commercially viable core. This wasn’t obvious with Chrysler. It was smaller than GM, and Rattner says the economic case for saving it was much weaker. Obama’s economist, Austan Goolsbee, argued that Chrysler ought to be liquidated: the net loss of US jobs wouldn’t be so bad, because many of Chrysler’s customers would buy their cars from GM and Ford. Better to have two strong companies than three weaker ones. At one point Team Auto considered a plan to transfer Chrysler’s top brands — Dodge Ram, Jeep, and Chrysler minivans — to GM, and shut down the rest.

The political interference after the deal was announced came from Congress, on behalf of car dealers.

Team Auto was divided on whether to subsidize a deal with Fiat to save Chrysler. Rattner voted to do it, but he sounds as if he wished he hadn’t. The matter finally went to Obama, who said to do it. That is when Obama told Rattner to be “tough” and “commercial”—advice that Obama was not exactly following, himself.

The main theme of Rattner’s book is that the GM deal — the big one — was done much as a private investor would, if the investor had decided already to do something. Team Auto’s aim was to make the company profitable. That meant a new CEO, a new chief financial officer, a new chairman, and several new members of the board. It meant shedding Pontiac, Saturn, Hummer, and Saab, and narrowing the product line to Chevrolet, Buick, Cadillac, and GMC Trucks. It meant shedding almost 30,000 jobs. And it meant cutting out 1,124 GM dealers.

The political interference after the deal was announced came from Congress, on behalf of dealers. Each member had imperiled dealers in his district. Sen. Kay Bailey Hutchison, Republican, held up a war-funding bill on behalf of Texas car dealers. House Majority Leader Steny Hoyer, Democrat of Maryland, went to bat for a dealer who had sold only three Chryslers in all of 2008 — and later told Rattner he’d let the companies keep too many dealers alive. Or so Rattner says. Rep. Gabrielle Giffords, Democrat of Arizona, went to bat for a Chrysler dealer, Rattner writes, and “repeated her talking points over and over.”

The intervention by Congress, Rattner writes, was “an enormous, pointless distraction for the two companies at a critical time. Its interference left me wondering what in the auto rescue Congress might like to micromanage next — choosing factory locations or deciding which executives and workers stayed and which had to go?”

That’s politics. The incentives facing elected officials are alien to the imperatives of business. Of course, members of Congress would not have had the ability to intervene so easily if there had been no intervention by the executive branch.

Which gets back to the original question. Obama is an elected official. Why did he let this be done in a mostly businesslike way?

Rattner doesn’t ask the question, but the answer that floats to the surface is that Obama is responsible for the whole country, not just congressional districts with GM and Chrysler assembly plants.

But it was more than that. Probably the strongest reason why Obama didn’t politicize the bailouts to the extent that libertarians feared — and a reason not in Rattner’s book — is that the American people, Republicans and Democrats included, hated the bailout. The polls were clear about that. The first demos of the Tea Party showed it. So did the rise in the reputation of Ford, which became America’s most popular car company because it never took a bailout. There simply was little political gain for Obama in creating Government Motors, and much political hazard.

Probably the strongest reason why Obama didn’t politicize the bailouts to the extent that libertarians feared is that the American people hated the bailout.

So he didn’t do it. By the standards of capitalism — the standards of the market — the bailouts have turned out well. The new General Motors and the new Chrysler are viable companies. Libertarians have to admit that.

When they do so, they should also point out that much of this was due to luck, and not anchored in the nature of things. This time it worked out; but once you allow politicians to run about fixing broken industries with public money, all sorts of bad incentives are created. There is the bad incentive to be a Rick Wagoner, and wait to be saved. There is the bad incentive for the bailers-out not to be tough and commercial, but to be political instead, in order to get votes. In the spring of 2009 Obama wasn’t over a barrel for the electoral votes of Michigan and Ohio, but a future president might be. Rattner alludes to these problems, but his book is about the specific case, not a general case.

A car company rescue also gives the politician a chance to be tinkerer-in-chief. Obama isn’t a car guy, but I can think of politicians who would use the opportunity to push the Chevy Volt, or to go beyond it. Rattner is blunt about the Volt: it costs $40,000 to make, and it competes with cars that cost half as much. He writes, “There is no scenario under which the Volt, estimable as it may be, will make any material contribution to GM’s fortunes for many years.”

In his epilogue, Rattner compares the auto rescues, which resulted in two viable companies, with Obama’s “stimulus” package, which cost 10 times as much and spent the money “without anything like the rigor that private equity or venture capital investors apply.” He says that Americans “we will be disappointed by how little lasting benefit we got for those dollars.”

That is so. It is also a low standard for measuring government spending.

Libertarians still have strong reasons to oppose corporate rescues generally. But each case has its own facts, and sometimes a bad idea delivers good results.

I’m glad it came out well — I guess.


Editor's Note: Review of "Overhaul: An Insider's Account of the Obama Administration's Emergency Rescue of the Auto Industry," by Steven Rattner. Houghton Mifflin Harcourt, 2010, 320 pages.

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Federalism in Action


The greatly imperiled traditional view of federalism has it that among the other mechanisms for the balancing (and hence constraining) of powers in our government, the states require substantial power to balance that of the federal government.

One of the benefits of federalism is that it allows the various states to experiment. If Texas wants to try fiscal discipline while California engages in fiscal incontinence, the rest of the states can watch and judge which fiscal policy is most productive of wealth and happiness for citizens generally.

We see this happening now before our very eyes, as most of the states grapple with budget deficits. Different states are pursuing different policies.

We see, for example, Illinois jamming through a two-thirds hike in personal income taxes and a nearly 50% rise in state corporate taxes to deal with its budget deficit. But in Georgia, a bipartisan tax commission has recommended to the state legislature that it cut its personal and corporate tax rates from the present 6% down to only 4%. As one of the commission members — economist Christine Ries of Georgia Tech — put it, “Our over-riding goal was to get the income tax rate down as low as possible, because the evidence is so clear that this is the biggest driver of growth and jobs.” The commission proposes to cover the tax loss by expanding the application of Georgia’s 4% sales tax to many purchases (such as groceries) now exempt from it.

Shifting corporate and personal income tax to consumption tax seems like an economic no-brainer if you want to encourage the creation of jobs, although as the Wall Street Journal notes,the logical thing would be for Georgia to eliminate the income tax altogether (as nearby Florida and Texas have done).

Again, it is nice to be able to contrast the behavior of, say, California with Utah. Newly-installed California Jerry Brown, the aging Moonbeam whose original decision (1978) to let public employees unionize and collectively bargain was a major reason for the state’s massive overspending today, and who owes his election to massive spending by those same unions, has proposed a plan to deal with the state’s budget deficit. It calls for dramatic increases in taxes and some cuts in spending, but does nothing to address the ridiculously bloated salaries and pensions that state employees receive. He intends to use the prospect of cuts in services to cow the citizens into raising taxes.

This is the typical statist ploy: threaten cuts in public service to get what you really want, which is always more taxes, while leaving the underlying problem (ballooning compensation and pensions for government workers) untouched. At least the miserable Governor Schwarzenegger tried, at the beginning of his regime, to address the public employee pension problem, by floating an initiative that would have put all new hires on defined contribution plans (such as 401k), before being whipped into a girly-liberal by the public employee unions.

Illinois is another case of the statist response to the pension crisis. Governor Pat Quinn, just a month before the November election and in the face of a huge state budget deficit, gave the public employee unions a guaranteed two years of no layoffs and even cost of living increases. With their support he squeaked through to reelection. After winning, he jammed through massive tax increases.

Now, Utah has taken a different tack. The state pension plan was fully funded back in 2007, but suddenly, by 2009, it fell to only 70% funded, meaning that the state faced a pension funding gap of $6.5 billion. This gap was one and a half times the debt allowed by the state constitution. But the constitution makes changing the pension plans of current workers virtually impossible.

So the Utah legislature made a reasonable choice, under the circumstances. It set up a defined contribution plan for all hires, starting this year, the state donating a generous 10% of the employee’s salary. The plan allows employees a defined benefit option — but again, the state’s contribution is capped at 10%.

For workers, the nice thing about the plan is that they have a fully portable plan, and one whose assets they own personally, so they can’t be “borrowed” by government and used to buy votes in the way that Social Security funds are, or appropriated by a union and used to buy politicians.

The nice thing for taxpayers is that this plan will eventually cost them only about half what the old system would. It shields them from having to cover the costs of any future stock market declines.

Legislatures in Montana and a dozen other states are looking at this model.

That, dear reader, is truly federalism in action.

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It's the Population, Stupid


The Kyoto Protocol is an international treaty designed to lower global temperature by having industrialized countries reduce their greenhouse gas emissions. That the United States, the largest energy consumer, has not ratified the treaty frustrates climate control advocates. They do not understand our failure to embrace such a climate change hat trick: empower globalism (i.e., increase the power of the United Nations), augment environmentalism (i.e., enrich environmentalists), and, of course, regulate capitalism (i.e., punish free enterprise). It’s a win-win-win proposition, except for one problem. The scheme won’t work. World population guarantees stark failure.

This is not to say that we are on the verge of a Malthusian collapse. But no matter how zealously the apostles of climate control push their questionable emissions reduction schemes, there is no doubt that anthropogenic demography will trump anthropogenic temperature. Any emissions reduction goals that may possibly be achieved will be negated so readily and predictably that only colossal incompetence and irresponsibility can explain why global warming scientists proposed them in the first place.

To quantify this folly, let’s take a look at how Kyoto would play out with full US participation. Don’t be alarmed by the math. Remember, mathematics is the language of science (although the verdict is out on whether the global warming variety is actually scientific). In any case, this is only middle school algebra, and all the terms and numbers are from UN sources.

Annual global energy consumption (GEC) can be estimated by

         GEC = n1*c1 + n2*c2

where n1 is the population of the industrialized world (North America, Europe and Oceana) and c1 is its per capita energy consumption; and n2 and c2 are the corresponding parameters for the developing world (Asia, Africa and Latin America). According to 2010 UN population figures, n1 = 1.12 billion and n2 = 5.79 billion. According to the International Energy Agency (IEA), c1 = 4720 and c2 = 976, where these values are measured in kilograms of oil equivalent (KGOE). Thus, without Kyoto, the current GEC would be

         GEC = 1.12*4720 + 5.79*976 = 10,937 billion KGOEs.

Let r be the emissions reduction rate for industrialized countries. Since developing countries are not required to reduce emissions, annual GEC under the Kyoto scheme would be given by

         GEC = (1 — r)* n1*c1 + n2*c2.

Initially, a 5.2% emissions reduction below 1990 energy consumption levels was set for industrialized countries. But for this illustrative analysis, let’s assume a 10% reduction from 2010 levels. Then, with US participation, the current GEC would be

         GEC = (1 — 0.1)* 1.12*4720 + 5.79*976

          = 10,409 billion KGOEs.

Thus, if the US joined other industrialized countries in reducing emissions by 10%, a GEC of 10,409 billion KGOEs would be achieved — a level that would eventually reduce global temperature by a degree or so, the proponents hope. That is, we must continue at this level until the International Panel on Climate Change (IPCC) tells us that environmental catastrophe has been averted — at least until 2050. However, in 2050, n1 = 1.19 billion and n2 = 7.96 billion. Then, GEC will be

         GEC = (1 — 0.1)* 1.19*4720 + 7.96*976

          = 12,824 billion KGOEs.

Oops! That’s a 2,415 billion increase over the planet-saving 10,409 level. Scientists at the IPCC apparently forgot to take into account the 37% population increase in developing countries. No problem. The emissions reduction rate required for industrialized countries to bring world GEC back into alignment can be easily found by solving for r:

         r = (GEC — n2*c2)/n1*c1

          = (10,409 - 7.96*976)/1.19*4720 = 0.47.

Oops, again! And, this time, it’s a very inconvenient oops. At 47%, we’ll have to try 4.7 times harder than before. If you have turned your thermostat down three degrees to save Mother Earth today (e.g., from 75 degrees to the Obama-recommended 72 degrees), plan on turning it down over 14 degrees by 2050. At 47%, the Prius of 2050 might be the ten-speed bicycle; the Energy Star clothes dryer, the clothesline.

It gets worse — much worse. With their cheap labor and emissions reduction exemptions, developing countries will become the manufacturers of the most energy-intensive products used by developed countries. Among other products, they will, no doubt, produce all of our windmills and solar panels. Their factories will use more energy and their, now wealthier, employees will increase purchases of products (electrical appliances, automobiles, etc.) that consume more energy. Therefore, assume, quite reasonably, that developing countries increase per capita energy consumption to, say, 1300 KGOEs — a 33% increase, but still a small fraction of what people in developed countries consume. In this case, the 2050 GEC would be

         GEC = (1 — 0.47)* 1.19*4720 + 7.96*1300

          = 13,325 billion KGOEs.

Oops, again! And, this time, it’s a fatal oops. Even with the industrialized world complying at a 47% emissions reduction rate, a slight 324 KGOE increase in developing world energy consumption results in a 2916 billion increase over the 10,409 level needed to save the planet.

Luckily, solving the above equation for a new planet-saving emissions rate is unnecessary. Noting that 7.96*1300 = 10,348, energy consumption by developing countries alone effectively breaks the planet-saving energy budget of 10,409. That is, under UN-projected population growth and a reasonable estimate of energy consumption growth in developing countries, the emissions reduction rate for industrialized countries required to make the Kyoto scheme work is 100%.

The Kyoto Protocol is a parasitic scheme in which the population of developing countries acts as an inherent flaw, bounding the effectiveness of the scheme to a level well below that required for its success. Proponents would have us believe that emissions reduction by industrialized countries is the solution. But, as shown above, the Kyoto goal is unachievable even in the 100% reduction case. It is the population growth of developing countries that bounds Kyoto’s success. Ignoring it ensures Kyoto’s failure. Under Kyoto-style schemes, global temperature will be as unconstrained as the delusions of climate control advocates.

It’s one thing to propose a stupid plan. Sometimes, even a stupid plan has a chance of eventual success. But it’s quite another to propose a plan that defies middle school algebra.

Congratulations! If you made it this far, you are smarter than a global warming scientist.

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Missing the Economic Boat


The Company Men is a highly relevant film about the financial meltdown of 2008, when hundreds of thousands of workers suddenly lost their jobs to downsizing and company closings. As a work of entertainment, it's overly didactic and preachy, but as a social commentary it provides many insights and offers great fodder for conversation and debate about the economy and how to fix it.

The film begins with a montage of the homes and toys of the super-rich. The camera pans through wealthy neighborhoods of elegant mansions with their gleaming kitchens, high-priced antiques, luxury cars, fancy swimming pools, and garages full of tony sports equipment. These are people who know how to enjoy their incomes. In the background we hear a voiceover of news reports about the financial meltdown, when, for example, 53,000 Citigroup workers lost their jobs in a single day.

The film highlights three mid- to high-level employees of a fictional conglomerate who lose their jobs in the blink of an eye. Bobby Walker (Ben Affleck) is a local boy who worked his way through college to earn an MBA and a well-paying job as a sales representative. Gene McClary (Tommy Lee Jones) is the head of a division that was once his own shipbuilding company, now owned by the conglomerate. Phil Woodward (Chris Cooper) is a 30-year veteran of the company who started as a welder in the factory and worked his way up to management.

All three lose their jobs to downsizing. One minute they're high-fiving each other about their golf scores; the next minute they're packing their boxes and heading out the door with twelve weeks' severance pay and the address of the Outplacement Center. There they sit in cubicles much like the ones where they worked in the company, only now what they're selling is themselves as they hunt for jobs that are increasingly scarce. As the weeks wear on, they become more discouraged, resentful, and scared. As Bobby complains, "I'm 37. How can I compete against MBAs fresh out of college who are willing to work for half what I was earning?"

What a swell guy! Wouldn't it be nice if everyone could work permanently for nothing?

The men's wives also become discouraged and resentful. At first, they all appear to be snippy housewives whose lives revolve around shopping and decorating, but each reacts differently to the news of her husband's layoff. One gets busy tightening the family budget and going back to work as a nurse. Another refuses to let anyone know, insisting that her husband continue leaving the house every morning, carrying a briefcase, and not letting him return until evening. A third marriage breaks up. In many ways, losing a job is as stressful as experiencing a death, and the reactions are as profound and as varied. Strong marriages become stronger; weak ones fall apart.

Writer-director John Wells has a definite point of view, and it is decidedly not in favor of people who make money by buying and selling. Borrowing a page from Marx's attitude toward money, he sees salesmen as useless middlemen who produce nothing and use nothing; they just handle the money. By contrast, Wells presents Bobby's blue-collar brother-in-law Jack (Kevin Costner) as the film’s true hero. Even Jack's modest home, where everyone drinks beer instead of wine and plays football in the backyard, is presented as being more fun than Bobby's fancy home.

Jack is a homebuilder by trade, and he hires people to help him. Unlike the corporate CEOs, who earn their bonuses no matter how poorly the company has performed and then fire employees to reduce costs, Jack actually underbids a job that will barely break even for him, just so he can keep his workers employed. What a swell guy! Wouldn't it be nice if everyone could work permanently for nothing? The film’s economic assumptions are hardly plausible, especially its Pollyanna ending (which I won't reveal here). And it conveniently overlooks the fact that the construction industry has taken a hard hit in the recession as well.

As I watched this film I thought about the plight of the people with which it is most concerned, the upper-middle class who in 2008 were working hard and following a path laid out for them by the preceding generation. They are people caught in the middle — they aren't important enough to have golden parachutes, like the CEOs, but they aren't poor enough to be able to maintain their lifestyles through unemployment checks, Section 8 housing, and government welfare. They don't qualify for Medicaid or food stamps, but they can't afford to pay their mortgages, make their car payments, or keep up with tuition and insurance when they lose their jobs. People who build their dreams on debt and long-term contracts just can't cut back when times get hard. They have no way to weather a storm.

The government’s intervention has created an artificial imbalance in the marketplace. It's time for government employees and union workers to start feeling the pinch as well.

Another thought that came to mind is that private businesses have borne the brunt of this recession. They are the ones making the difficult decisions to cut back or close down. A select few corporations have been bailed out by the government, but at the expense of others that are forced to contribute to their own demise through onerous taxation that funds the privileges awarded to their competitors. The government’s intervention has created an artificial imbalance in the marketplace. It's time for government employees and union workers to start feeling the pinch as well.

The Company Men makes some excellent points about how hard it is to deal with long-term unemployment. Affleck, Jones, and Cooper play their parts with a dignity, pathos, and poignancy befitting the characters they play in this film and typical of their own talented careers. But Wells is woefully underqualified to offer solutions to the economic problems we continue to face.


Editor's Note: Review of "The Company Men," directed by John Wells. Weinstein Productions, 2010, 104 minutes.

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Rousing the Rubes


Sarah Palin interested me during the 2008 U.S. presidential election, for two reasons.

First, she occasionally seemed to embody the “West coast” style of libertarian political philosophy, based more on practical life experience than on academic training.

Second, her flashes of libertarianism seemed in tension with her claims of evangelical religious faith.

Either of these matters could have made her a compelling public figure. I hoped that she’d bring the first into mainstream political consciousness and offer some resolution to the second. But things didn’t work out that way. Quickly, Palin’s public figure had more to do with persona than philosophy.

Then, in fairly short order, her ticket came in second in the presidential election, she resigned as governor of Alaska halfway through her first term, and she signed a contract with the Fox News Channel to appear regularly as a commentator. She also released two books and starred in a short-lived “reality” television show.

In the coming presidential election cycle, I expect that Jon Huntsman — who’s recently resigned his position as U.S. Ambassador to China and taken the initial steps toward candidacy — will be the person who might raise the issues I’d hoped that Palin would.

Meanwhile, Palin remains on the scene. Her cult of personality is still strong. And her cult of animosity may be even stronger.

I’m not the first to note how closely she resembles the character Emmanuel Goldstein in Orwell’s 1984 — in respect to oppositional politics, if not to intellectual power. Establishment Left groups use her name or image to incite passionate response in readers, donors, and other constituents. We’d need someone like Freud to explain the reasons why Palin resonates so strongly with the Left. But there’s little doubt that she’s marketing gold — a lip-rouged bogeyman who drives clicks to leftwing websites and sells magazines and books.

There we might leave the discussion. And yet . . . the intensity of Palin-hate that small minds on the Left feel is worth considering in some detail. It’s instructive of the state of political discourse.

In late January, the New York Times ran an opinion column by one if its lesser agitators. The piece was highly critical of Rep. Michele Bachmann, who’d recently delivered a semi-official Tea Party response to the president’s state of the union speech. The agitator mocked Bachmann’s manners and makeup but, more than anything else, she presented Bachmann and Palin (by ham-fisted logic since, to that point, Palin had said little publicly about Obama’s speech) for Two Minutes of Hate.

There’s little doubt that Palin is marketing gold — a lip-rouged bogeyman who drives clicks to leftwing websites and sells magazines and books.

And hate the Times readers did. It’s easy to ignore, or forget, how childish and emotional some Americans are about politics. The internet is great for illuminating things like this. Here are some excerpts from the scores of comments that appeared afterward on the newspaper’s website.

“Michelle Bachmann is as ridiculous a political figure as Sarah Palin. The question, however, is why we are covering either one of them. Both Palin and Bachmann know virtually nothing about the important political issues facing our nation, are not qualified to serve in any sort of high level political office, and do little more than degrade the level of political discourse in our nation.”

“The GOP is ignorant about history. The GOP is ignorant about Europe (Paul Krugman’s piece yesterday). The GOP combines that ignorance with an agenda to misinform the public in such a way that voters, against their own economic interests, support policies that benefit a wealthy elite that is getting richer by the day. . . . If only Obama had been the people’s leader we thought we were getting.”

“When I think of Michelle Bachman and Sarah Palin I always think of mud wrestling. Even Michelle’s description of the lovely outfit she was wearing years ago . . . doesn’t dislodge the frame by frame fixation I have of her and the former half-governor from Alaska in a mud pit, pulling each other’s hair, calling each other names, slipping and sliding in the sticky brown goo.”

Such keen insights are hard to top, but here are two more:

“I just don’t get it as to why do so many people respond favorably to people like Palin and Bachmann? And add to them Glen [sic] Beck and Limbaugh fueling their fire along with others trailing in their wake like Ryan and Boehner. They mock and are sarcastic with religious fervor. To me they are so off the wall and ridiculous that whatever they say is total nonsense. . . . I tremble. I want a brainy President like Obama and brainy people around him.”

She serves as a scapegoat, in the original sense of that term: she carries off the failings that her haters fear in themselves.

“Bachman and Palin are the bullies in the kindergarden [sic] of Republican politics and no other kid in their class will stand up to them. Could their behavior be a portent of the approaching death of the party of the rich old white well educated ruling elite and the emergence of a new party of servants of the rich — probably labeled the New Stupids, but just as much in the pockets of the monied [sic] class . . .”

Bear in mind that all of this was posted, in a public forum, just a few weeks after the “brainy” Barack Obama had called for more civilized rhetoric in the nation’s political debate.

I’m no Freud, but even I can see the psychological themes in the Palin-hate. It’s projection. And she serves as a scapegoat, in the original sense of that term: she carries off the failings that her haters fear in themselves. Ignorant, ridiculous, stupid, bullying, mocking, sarcastic, a stupid servant of others, of elite political forces,and . . . ridiculous. Clearly, her haters don’t feel very good about themselves.

And they worry — a lot — that they’re ridiculous.

Perhaps with good reason. “JF” from Wisconsin believes that the GOP’s wide-ranging ignorance empowers it to bamboozle the nation’s voters. And consider the political order, as interpreted by “Annie” from Rhode Island: in her view, three pundits and a junior congresswoman dictate the political agenda to the Speaker of the House. And there are thousands, probably hundreds of thousands, of these mail-order Aristotles out there — all desperate to show that they are so very much smarter than Sarah Palin.

I have no idea whether Palin will run for president in 2012 — though I doubt she will go very far if she does. But I’m glad she’s still on the scene. The response she evokes in the rubes is rich.

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A Gargantuan Gift to the Unions


After his decisive defeat in the recent congressional elections, President Obama is now trying to portray himself as a born-again centrist, verbalizing vague sympathies for small business and lighter regulation, not to mention capitulating to the Republicans’ demands to renew the Bush tax cuts for two more years. He is even feigning admiration for President Reagan.

But Obama is one of the most artful deceivers in the history of an office well known for attracting deceivers. As I have urged before (“Obamalaise,” Liberty, May 2010), you have to look at what he does, not merely at what he says. And what he is actually doing is continuing to advance his leftist agenda.

A particularly disgusting illustration is his recent decision, almost completely ignored in the mainstream media, to allow TSA employees (the airport screeners) to unionize.

When the TSA was set up, in the wake of the 9/11 terrorist attacks, the TSA administrator was given the authority to choose whether to give the employees the right to collective bargaining. Until now, the TSA has not done so. But Obama’s choice to head the TSA, John Pistole, changed that policy. Now the TSA’s 40,000 airport screeners — those paragons of efficiency and decorum, so eager to guard our privacy rights — join the ranks of public employees who are already in unions. The TSA employees will vote in March between representation by the American Federation of Government Employees (AFGE) and the National Treasury Employees Union.

John Gage, president of the AFGE, crowed, “Today marks the recognition of a fundamental human right for 40,000 patriotic federal employees who have been disenfranchised since the inception of the agency.” Well he might crow, since these events will add 40,000 new employees to the public employee unions, which saw a drop of about 250,000 members in 2010. They will thus add an enormous amount to union dues, which will be spent on (among other things) electing Democrats in the next election cycle. In line to get the lion’s share of those union dues will be Pistole’s boss, Obama. It is very convenient.

Pistole says that the TSA workers won’t have the right to strike or engage in work slowdowns — as if we could tell whether these people are staging a slowdown or not. He also says that the workers won’t have a say in any matter that concerns airport security.

The devil is in the details.

In any case, if Obama is reelected, you can bet that these presumed restrictions will be loosened or eliminated. In the meantime, after the TSA workers unionize, we can expect their wages and benefits to skyrocket, adding significantly to our national deficit. Worse, disciplining lazy or inefficient workers will soon become incredibly difficult, rather like trying to fire incompetent tenured teachers, with the obvious effects on our collective security.

Let us now praise moderate men.

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Blow Hot, Blow Cold


The Rural Electrification Act of 1936, one of the New Deal’s proudest accomplishments, is often cited as an example of government’s ability to do good and generate progress. In 1910, nearly 50 million rural residents (over half the country) lived without electricity. By 1950, 45 million of those formerly "unhooked" were "on the grid," thanks to the REA. Or so the story goes.

Commercial electric utilities, with low voltage transmission lines and facing huge infrastructure investments for universal service, were loath to extend power to far-flung homesteads. Additionally, these were regulated monopolies with prices fixed by the government. But Charles Kettering, developer of the electric starter for automobiles, sensed an opportunity.

After selling his company, Delco, to General Motors, Kettering introduced the Delco-Light Farm Electric Plant in 1916. The small gas-powered engine coupled to a 32v DC generator and a set of batteries came with an entire line of optional peripherals: lights, appliances, well pumps, and electric motors. It was an instant hit. By 1936, nearly 150 companies were selling farm electric plants and more than 600,000 rural homes and businesses were generating their own power.

Meanwhile, according to Craig Toepfer’s just-released The Hybrid Electric Home (Schiffer, 2010), a bunch of radio enthusiasts in Ohio were giving birth to the renewable-energy industry.Fine Homebuilding, a respected journal of the building trades, reports that the first wind generators were made by Great Plains farmers whose living-room radios were hooked up to car batteries that they got tired of lugging into town to be recharged so the farmers could listen to “the Clicquot Club Eskimos, the Ipana Troubadours, or WLS’s National Barn Dance.” So they mounted homemade propellers onto car generators, stuck them on a pole, and wired them to their radio batteries.

Other entrepreneurs sensed more opportunities. In 1930, the Jacobs Wind Electric Company opened its first factory in Minneapolis. Eventually, more than 20 companies were making wind generators. Ever frugal farmers, faced with scarcer funds, soon hooked up the wind generators to their oil-based farm electric plants to save fuel, creating the first hybrid generators.

But then Congress passed the first Rural Electrification Act in 1936, effectively killing the nascent off-the-grid power generating industry. As Toepfer argues, “In a monumental act of irrationality, justifiable only by a lack of knowledge or understanding, the federal government decided to do what no investor-owned utility would even begin to consider doing, extending the central station wires from the major urban centers to every rural and remote part of the nation.”

According to the stipulations of the Rural Electrification Administration, hookups performed under its aegis required the removal or destruction of wind and oil-based farm electric systems. The rationale for this misguided policy was that the only way to increase profitability for regulated monopolies with government-fixed prices was to increase demand, and this was most expedient method of reducing REA subsidies to electric utilities.

The REA doubtless improved the lives of millions of Americans. But Toepfer argues that for the $210 million that the government spent under the REA act, it could have provided every electricity-deprived homestead with a farm electric plant and a wind generator, and still not have spent all its money. Although there is no question that the REA supplied a much greater amount of power than the basic, self-reliant technology that was just getting off the ground, Fine Homebuilding opines that “we put all our eggs in one energy basket, committing the country to an inefficient electric grid, sanctioning tremendous environmental damage in the process, and squelching what could have been an enormous start for alternative energy."

Instead, 90 years later, the federal government’s industrial and energy policies see fit to reverse course and channel taxpayer funds into the same industries that it once saw fit to destroy. Go figure.

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Cronies Forever — Dude!


In a recent reflection, I noted a number of instances of what is fairly clearly corruption on the part of this Administration. (I was actually adding to a list of instances first given by the Washington Examiner columnist Tim Carrey).

But — such is my declining memory in my declining years — I missed a particularly egregious example of Obama’s Chicago School of Economics (which is definitely not to be confused with the Chicago School of Friedman and his co-workers).

The signature bill for which Obama will be remembered (or cursed) is his healthcare act, the eponymous Obamacare. One of the provisions of this monstrosity is the requirement that all healthcare plans must raise their annual limits to at least $750,000. (In 2012, that minimum allowable limit rises to $1.25 million; it then rises to $2 million in 2013.) Naturally, this requirement forces companies whose employee insurance has lower limits to raise them and thus pay higher premiums, or to cancel their employee health plans. The only way not to obey it is to go hat in hand to the Department of Health and Human Services — run by the Obama regime, remember — and get a waiver, which the HHS Department will grant or deny, as it sees fit.

The number of these waivers has been rising rapidly, with well over 700 companies and unions now having obtained them. And, behold! An amazing pattern is emerging about who gets the coveted waivers: disproportionately, they seem to be going to the regime’s supporters.

To be precise, as David Freddoso documents, 40% of the workers affected are in union plans. (In fact, of the 14.6 million unionized workers in this country, nearly a million are now conveniently exempt from the provisions.) But do I have to add that these unions are all huge donors to Democratic campaign coffers in general and Obama’s coffers in particular?

And I’m willing to bet that of the companies that got exemptions, a large percentage have also contributed to Democratic political campaigns.

That’s Obama’s Chicago School of Economics, or what I call neo-socialism. The regime doesn’t actually own all major businesses, but it controls them tightly and exacts tribute from them. More succinctly, it’s “play for pay, the Chicago way”!

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Media, Heal Thyself


In January the nation survived one of its periodic linguistic disasters — Jared Loughner’s alleged murder of six people and his attempted murder of Congresswoman Gabrielle Giffords in Tuscon, Arizona.

I’m not calling this a linguistic disaster because I am unsympathetic about the suffering and death that Loughner caused. The death and suffering are real, and talking won’t do anything to help the victims or their friends. Only human concern, the concern shown by individuals for individuals, can possibly do that.

But death, even the death of many people at the same time, is not unusual. During January 2011, hundreds of thousands of people died in the United States. Innocent people were gunned down by criminals. Whole families died in traffic accidents. Lunatics killed many more people than Jared Loughner dreamed of killing. Logically, there was no reason for speeches to be made about the Loughner affair, for Congress to report itself so distressed that it could not do its work, for Fox News, of all things, to run 24-hour coverage of what quickly became the non-news from Tucson, or for anyone else to expend sentences and paragraphs speculating about what it all meant, or should mean, to the republic.

This is not a heartless statement; it is the simple truth.

A few years ago, a guy tried to mug me while I was walking toward a store in my neighborhood. I fought him off. I suppose he could have killed me. But there was a logic to his attack. He wanted my money. “Give me your money,” he said.

You have to respect that. Perhaps you might also want to think about possible means of reducing the number of robberies. But debating the meaning of Jared Loughner? Why?

Some of the commentary on Loughner’s deed resulted from honest concern about whether there is any means of identifying people like him before they can do grave damage. But most of the debate was patently dishonest. Anyone who tries to make a political cause out of Loughner’s behavior is acting worse, in a way, than he did — because he didn’t know what he was doing. The people who immediately exploited his deed to argue for more gun control and more speech control and more media control — they know what they’re doing, and for that reason they are more dangerous than a thousand Loughners.

If you think otherwise, you are under the influence of words, not things, because that is all that the crisis of January 2011 consisted of. It was a crisis of nothing but words, words used to magnify and distort a private, virtually random mental disturbance and turn it into a national and political catastrophe.

The people who immediately exploited his deed to argue for more gun control and more speech control and more media control — they know what they’re doing, and for that reason they are more dangerous than a thousand Loughners.

As you know, within minutes of this sad event, modern-liberal newspaper columnists, and nearly everyone on television was proclaiming it a national tragedy, a troubling indication of the American mentality, a probable indication of the malign influence of political polarization, an undoubted indication of Things that Should Worry Every American, a possible subject for legislation and presidential decree, and, above all, a hopeful occasion for national “healing.” The idea was that Americans are so “fragile” that they are easily “unsettled” and even “wounded” by such events as occurred in Tucson. This is a slander on the American people — a cheap and obvious slander — and a revelation of a shocking lack of perspective on the part of America’s political and media class.

Let’s consider some preceding events.

1. On July 11, 1804, Aaron Burr, Vice President of the United States and President of its Senate, fatally wounded the statesman Alexander Hamilton, in a duel fought over the question of whether Burr was “despicable.”

2. On Feb. 24, 1838, William Graves, a congressman from Kentucky, killed a congressman from Maine, Jonathan Cilley, in a duel prompted by accusations of bribery by the latter about the former. The House considered censuring the victor but never did so.

3. On May 22, 1856, Congressman Preston Brooks of South Carolina, assisted by another representative from that state, Laurence Keitt, assaulted Senator Charles Sumner of Massachusetts on the floor of the Senate, beating him brutally. The House censured Keitt, and Brooks resigned from the House.

4. On March 1, 1954, Puerto Rican nationalists stood in the gallery of the House of Representatives and used automatic pistols on the 240 congressmen in the room below, hitting five of them.

5. On June 5, 1968, Robert Kennedy, Senator from New York, was assassinated by a Palestinian who was annoyed by Kennedy’s support for Israel.

6. On Nov. 18, 1978, in the country of Guyana, Leo Ryan, a California member of the House of Representatives, was slain by followers of the “revolutionary communist” Jim Jones, whose purportedly religious activities the congressman had been investigating.

7. On Jan. 8, 2011, Congresswoman Giffords was wounded in an attempt on her life by Jared Loughner, a maniac who thought that his junior college was committing “genocide” on him.

Ask yourself:

Which of these events was of national importance? On the face of it, nos. 1, 4, and 5; and once you understand the context of no. 3, which was the run-up to the Civil War, that one too.

Now ask yourself:

Which of them was a crisis? Here the answer is equally obvious: only no. 5 is a possibility, and only if it is considered from the perspective of the Democratic Party, whose nomination Kennedy was seeking (but almost undoubtedly could not have achieved). The death of Hamilton was a severe misfortune for his party, but not a crisis. The Puerto Rican nationalists were an organized group with a political platform, but they weren’t important enough to create a crisis, even if they had killed all the congressmen they hit. The beating of Sumner was a disgusting symptom of sectional division, not the crisis of division itself.

Ask yourself a third question:

Which of these episodes demanded a “healing of the nation”? Only the beating of Sumner. That was the only one in which deep and truly national emotions were at stake. Compare the approaching Civil War with whatever political causes Jared Loughner might, according to the wildest imagination, possibly be regarded as representing, and you’ll see how ludicrous it is to talk about “healing” the nation from the “rifts” and "wounds" that such causes have purportedly produced. In other words, compare the crisis of the Civil War with the current “crisis of civility.” What a laugh.

On Jan. 17, a popular Southern Californian radio personality, John Kobylt of the “John and Ken Show,” agreed with me in part when he identified Loughner’s act as that of a mentally diseased person, of no political importance. That’s true. But John called the response to this act “mass hysteria,” and that’s not true. It wasn’t mass hysteria. It was media hysteria.

The idea was that Americans are so “fragile” that they are easily “unsettled” and even “wounded” by such events as occurred in Tucson. This is a slander on the American people.

A week after the shootings, I was getting a haircut in the large, middle-American barber shop where I always go for that ritual. One of the barbers has a loud voice, and he introduced the topic of “you know, that thing that happened over in Arizona.” At first, nobody seemed to recognize what he was talking about. Even when he explained what he meant, it elicited, unlike sports talk, no special interest. Even the guy who brought it up couldn’t remember exactly what had happened, or whether anybody had been killed. One customer asked whether there was some kind of congressman involved, but nobody was willing to pronounce on that point. I could have, and probably some of the other 20 guys in the place could have, too. But nobody bothered. Nobody felt impelled to Set the Record Straight. That’s how important the whole thing was to that middle-American crew.

Another datum. During the weeks since the Arizona incident occurred, no one has brought it up to me. No one. I’ve mentioned it to a few people, and they’ve responded in due course. But nobody except me has thought it important enough to start a conversation about. I’ve asked my friends whether any of their acquaintances have brought it up, either. “Oh no,” they say, as if they were considering the proposition that water might run uphill.

This was not what anybody would call a major national event — not for the American people, at any rate. It was a media event. It was an instance of media hysteria, of word hysteria.

It was also an instance of the lack of scale that appears to be built into the media’s approach to human life. A long time ago, the media threw away all measuring devices. During the 1970s, the nation was constantly told that Watergate was “the greatest crisis since the Civil War.” The deterioration of the economy that occurred during the same decade, and that seems today its most important event, received no such dramatic amplification. Today we are taught that our current economic distress is “the worst since the Great Depression.” Yes, it’s bad; and we will see something worse when the bills finally come due for the past decades of profligacy, but I doubt that what we are suffering today is worse than the economic weirdness that followed World War II, or the gas rationing, price controls, and stagflation of the 1970s.

It’s easy to lose your sense of scale when you’re pushing an ideology. You want to lose it, and suddenly, it’s gone! That goes for all those Watergate comments, for the cooked statistics about “homelessness” that were designed to make President Reagan look bad, for the constant blather about the dangers of “handguns,” for the scare tactics used to inspire “respect for the environment,” for the . . . . . But no, I could expand the list indefinitely, and so could you. But there’s something else going on, something that’s hard to explain except by reference to ignorance, stupidity, and the desire to punch up any story for which video is available.

Compare the approaching Civil War with whatever political causes Jared Loughner might possibly be regarded as representing, and you’ll see how ludicrous it is to talk about “healing” the nation.

Here’s what I mean. If they’re watching American TV on Mars right now, they think that fees in community colleges are $100,000 a year, because all they see is suffering students bewailing the fact that “fees keep going up.”Nobody tells them that the fees are practically zero, compared to other costs of living. In addition, the Martians probably believe that Americans do nothing but lose children, then try to relocate them — not realizing, because nobody ever mentions it, how unusual lost children, truly lost children, really are. And I’m sure the Martians believe that every year, America’s landmass is swept by gargantuan fires, because the news folk keep saying, “And in California right now, wildfires have consumed over 1000 acres, with no containment in sight.

Please. Doesn’t anyone have a hand calculator? The Southern California county in which I live contains 2,896,640 acres, the great majority of them uninhabited. In brush country, you can expect a fire on any given acre at least once every 30 years. And the fires always get contained. They don’t keep burning till they reach Cleveland. But even as I write these words, Fox News is showing me a grass fire, somewhere in these great United States, that is actually “burning two structures!” Oh really? In 2009, the last year for which comprehensive statistics are available, fire departments in the United States dealt with almost 400,000 home fires. The fires killed more than 2,500 people. Maybe good video wasn’t available on those.

During the past few days, I’ve watched a lot of cable coverage of the riots in Egypt. Frequently, the talking heads refer to the fact that, as they say, “the United States gives over one billion dollars in aid to Egypt!” The real figure is somewhat larger than that, but never mind. CNN and Fox News have radically different ideological outlooks; yet neither of them has any scale or measurement in its reporting. One or two billion dollars is nothing in the American scale of spending. The annual budget of the university where I teach is larger than that, and it's far from the largest university in the country, or even the state. My city plans to spend about $200 million building a new library. I don’t think it should, but that’s beside the point. If we sent the money to Egypt, it would increase America’s bribery to that country by roughly 10 percent.

Now, when was the last time you heard anything like that from the media?

By the way, CNN and Fox News have both placed heavy emphasis on the idea that you gotta understand the Egyptian revolutionaries, because the official unemployment rate in Egypt is as high as 9%! Tell me, what’s the official unemployment rate in the United States? On Feb. 4, it was reported to be 9%.

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Welcome, Oscar


I wasn't a fan of the Motion Picture Academy's decision to expand its field of Best Picture nominees to a crowded 10. But maybe the Academy is onto something. This year it has given its membership the opportunity to recognize a range of work that includes small independent films, big-budget blockbusters, thoughtful biographies, an animated film, a comedy (of sorts), and even an old-fashioned western.

With one exception, I have reviewed all the nominees in Liberty — and I have “viewed” that exception, even though I didn't review it. I don't know which of these fine films will take home the statue, but I think I'll be satisfied this year no matter what. Here is a quick review of each of the Best Picture nominees.

Inception. The most exciting, astounding film of the year, this psychological thriller stunned audiences with its mindboggling cityscapes folding into themselves, how'd-they-do-that weightlessness, multiple layers of reality, and action scenes worthy of a James Bond film. Added to all that are the creative musical score by Hans Zimmer (also nominated for an Oscar); knock-out performances by Joseph Gordon-Levitt, Leonardo DiCaprio, and Marion Cotillard; and an intellectual script that challenges the viewers' perception of reality and of how beliefs are formed. Months after the film’s release, fans are still arguing about its central meaning: the action takes place inside a dream, but whose dream is it? (I know — do you?) Unaccountably, writer-director Christopher Nolan was shut out of the nominations for Best Director. Also, the film was probably too popular at the box office to take home the prize. But I'm glad to see it nominated. It’s my favorite studio film this year.

Winter's Bone. This rugged little indie film was my happiest surprise of the morning when the nominees were announced. Ree Dolley (Jennifer Lawrence, nominated for Best Actress) is the most libertarian heroine in the movies this year. When her meth-lab father puts the family farm up for collateral with a bail bondsman, then vanishes from town, Ree must track him down and bring him to court to keep from forfeiting the homestead. She is the kind of self-reliant heroine one can genuinely admire. A high school student raising her two young siblings, she briefly considers joining the Army to take advantage of the $40,000 enlistment bonus — but she does not consider turning to the government for welfare handouts. Despite her family's deep poverty, there is no evidence of social workers, child protective services, section 8 housing, or even food stamps. The film is set in the Ozarks, in a closed, insulated community where people eat off the land, or they don't eat at all; and Ree manages not only to eat but to triumph over her difficult surroundings. I'm delighted that this film will be brought back for viewing, now that it has been nominated for Best Picture.

127 Hours. If Ree Dolley is the most libertarian heroine of 2010, Aron Ralston (James Franco, nominated for Best Actor) of 127 Hours is her male counterpart. When Aron gets pinned by a large boulder after falling into a crevasse while hiking in a Utah canyon, he sets to work figuring out how to free himself – which he does in a heroic and horrifying way. This film could have been claustrophobic and gratuitously graphic, but instead it is a celebration of level-headed innovation and the drive for self-preservation. Moreover, it is a powerful metaphor for life in the new millennium. We hurtled our way through the go-go ’90s, pumped up by a soaring stock market and roaring real estate investments, only to be pinned down by boulders that were, as Aron philosophizes, “there all along, just waiting to meet me in that canyon.” Too many people waste precious time crying over their problems or waiting for “someone” (read: the government) to fix them. But as Aron Ralston’s story clearly demonstrates, the key to success is to assume that no one is coming to bail you out. Instead of worrying about the cellphoneyou don’t have, assess the tools you do have. Keep a positive spirit. Be resourceful and self-reliant. Be a problem-solver. Remember to thank the people in your life and tell them that you love them. And don’t be afraid to let go of the thing that is holding you back, even if it is as precious as an arm.

The Fighter. This film about boxing brothers Dicky Eklund and Micky Ward received its nomination largely on the strength of its cast and director (David O. Russell, also nominated). The film boasts three Best Supporting nominations, and each of them is richly deserved. Christian Bale seems to be Hollywood's go-to guy when directors need an actor to lose a ton of weight (The Machinist, Rescue Dawn), but it isn't just the weight-loss that garnered Bale the nomination. As the wide-eyed, hyped-up, drug-addled, former boxing legend Dicky Eklund, he lights up the screen with his cocaine-induced enthusiasm and gut-wrenching pathos. And Melissa Leo, who plays the family’s hard-driving, chain-smoking, no-nonsense matriarch in tight pants and high heels, is my favorite Supporting Actress of the year. Leo is over-the-top perfect in this role, from the moment she prances into the gym, clipboard in hand, to supervise Micky's training session. Alice is the ultimate stage mother: pushy, strong, manipulative, and naively confident in her ability to manage her sons’ careers. Going head-to-head with her, on Oscar night and in the film, is Amy Adams as Micky's girlfriend Charlene, who stands up ferociously to the matriarch and her seven big-haired daughters in this film. Adams is a skilled actress, at home playing charming ingénues in romantic comedies or gritty working girls in dysfunctional dramas like this one. But Leo is my Oscar choice, because of her performance in The Fighter and also because I admired her equally strong performance as the investigator in this year's weaker prison film, Conviction. Mark Wahlberg's performance as Micky is strong as well, but he wasn't nominated for an Oscar, possibly because he's the straight man in the cast, and those characters are often overlooked by the Academy. It's a shame, because Wahlberg shepherded this story for several years and is the driving force behind the film.

The King's Speech. Let's get serious now. While the films listed above are my personal favorites this year, The King's Speech is the film that I expect (and hope, since it is better than those listed below) to see storming the stage at the end of Oscar night. It's a film about triumph over personal and public obstacles, as the unassuming man who would become King George VI struggles to overcome his speech impediment and prepares to lead England during World War II. Colin Firth and Geoffrey Rush are glorious as the prince and the speech therapist, sparring like equals despite their difference in social class. Helena Bonham Carter captures the tender affection and twinkling eye that would characterize Elizabeth, the Queen Mum, throughout her life. All three are nominated. Indeed, The King's Speech leads the pack for nominations, with an even dozen. It is likely to walk away with at least half of those.

The Social Network. Mark Zuckerberg isn't even 30 yet, and already he's been immortalized with a film about him. Reportedly the multibillionaire whiz kid, who changed the way people communicate with one another when he created Facebook (even I use it now!), isn't very happy about the way he is portrayed in the movie. But no matter — this film is going to be the way people remember and define Mark Zuckerberg. A fascinating look at the relationships among conception, production, and capitalization in a startup business, the film focuses on the intellectual property lawsuit brought by classmates against Zuckerberg (Jesse Eisenberg, nominated for Best Actor) and the frenzied atmosphere that surrounded the beginning of the business. The musical score by Trent Reznor and Atticus Ross(also nominated) contributes to that atmosphere and is likely to win.

True Grit.Wouldn't it be fun if Jeff Bridges (nominated for Best Actor) won in this category? Then we would have two men receiving Oscars for the same role, and both for the wrong reasons. Let's face it — John Wayne was a star, not an actor.He was good in True Grit (1969), but there was nothing outstanding about his performance. It was just his turn, and everyone knew it. Jeff Bridges’ Rooster Cogburn is better in every way than Wayne's. But better than Colin Firth in The King's Speech? Or Jesse Eisenberg in The Social Network? Or James Franco in 127 Hours? It's an impressive field of actors this year, and Bridges should be grateful that Crazy Heart came out last year instead (he won the Oscar for that film). Nevertheless, I could see the Academy voting for Bridges, just for the notoriety of having two men win for the same role. Cynicism aside, I have to report that this is a wonderful movie. But it's Hailee Steinfeld (nominated for Best Supporting Actress) as Mattie Ross, not Jeff Bridges, who lifts the film to greatness. Whether she's negotiating with horse traders, sparring with Texas Ranger LaBoeuf (Matt Damon), or confronting Tom Chaney (Josh Brolin), the man who killed her father, she dominates each scene with her combination of spunk, courage, intelligence, and vulnerability. Her relationship with Rooster develops slowly and genuinely, building to the scene where he literally drives her horse into the ground as he races against time to save her. It's a thrilling film in every sense. Those Coen Brothers (nominated for Best Director) can do just about anything.

Toy Story 3.Pixar was a brand new animation company when it introduced Toy Story in1995, and the franchise has grown stronger with each installment of this clever series and its cast of beloved toys led by Woody, Buzz, Jessie, and Mr. Potato Head. Now Andy, their owner, has grown up, and as he goes off to college his mother encourages him to donate his old toys to a neighborhood preschool. Their zany adventures continue as they try to survive the rough-and-tumble children and get back home to Andy. As witty and poignant as any of the films in the series, Toy Story 3 deserves its nomination for Best Picture. Incidentally, Andy's decision to give his toys to a neighbor girl, while perhaps satisfying popular cultural values, broke this mother's heart. I want Andy to come back five years from now with a family of his own who will play with his old toys!

Black Swan is a satisfying psychological thriller that explores what it means for a performer to enter a role and become a character. Nina (Natalie Portman, nominated for Best Actress) is technically a superb ballerina, but she lacks the depth of character to reach into the dark soul of the black swan in "Swan Lake." As she prepares for the role she must deal with an overbearing mother, a lecherous director, a creepy competitor, and her own repressed sexuality. Not my favorite film of the year, but certainly a creative and visually impressive work.

The Kids Are All Right. I haven't watched this film, but I've seen it. I was flying across country two days before Christmas in one of those planes with individual movie screens in the back of each seat that allow passengers to choose their own entertainment. I was quietly minding my own business, playing Trivial Pursuit, when I suddenly received an eyeful from the screen between the seats in front of me: two naked men were simulating sex on a screen within the screen, followed by what looked like a stern talking to from a concerned Annette Bening — evidently the "son who's all right" was caught watching porn. A few moments later I glanced in that direction again and saw Bening apparently watching TV in bed. Suddenly her blankets started rumbling like an earthquake, she started smiling, and Julianne Moore emerged from under the sheets. And then the men's naked bodies were onscreen again (I guess Mom #1 needed to discuss it with Mom #2, or something). I stopped playing my game and opened a book so I wouldn't have to look in that direction anymore. I don't pretend to know what this film is about, and I don't have an opinion about whether it deserves an Oscar nomination. I just don't think a version offering unedited, unexpected nudity should have been shown on a Christmas flight full of children. Or old fogeys like me.

#39;t know which of these fine films will take home the statue, but I think Iem

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