There are no words to express the gratitude we feel for those who have sacrificed their lives in the cause of freedom, for those who have suffered grievous mental and physical injuries, and for those families that suffer along with their service members.
We remember and wish to thank all of those who now serve and their families as well.
I know that words of encouragement and support are important to our service members. But, I think they might appreciate it more if they could count upon us to provide the care they need if injured and to know their families would be cared for if they paid the ultimate price.
Memorial Day serves as an important reminder and a time for honoring the brave men and women who have given their lives. We honor them with a mixture of gratitude and sadness in our hearts. We continue to live free because they paid the price for us.
The debt we owe cannot be paid to those who have died. But, we can pay a measure of our debt by working each day to support those who serve, the injured, and the families of those who have fallen.
A MEMORIAL DAY MESSAGE
LEADERSHIP THAT WORKS
Words matter-it’s a favorite expression of Democratic politicians and supporters. The question is “what are their words meant to accomplish?”
When a magician performs a magic trick, a dialogue with the audience is important to the success of the illusion. The words spoken are designed to distract the audience, keeping them focused on the words and not the actions he is performing.
When President Obama “drew a red line” in Syria and then backed away, his action, or lack of it, spoke louder. When President Trump attacked the Syrian airfield after their chemical attack, no words were necessary. The action spoke for itself. Everyone understood a line had been crossed and if it was crossed again, there would be more action. Everyone understands where the line is drawn. Actions speak louder.
When President Obama gave eloquent speeches about supporting article 5 of the NATO agreement, the common defense accord, and followed that by removing defensive missile batteries from Eastern Europe, his action spoke louder. When President Trump met with NATO without mentioning article 5, he was criticized by many Democrats for the lack of mention. Those specific words are not necessary because NATO members understand that President Trump supports NATO and he is a man of action.
When President Obama was asked about terrorism, he could not call it the evil that it represents. He spoke of solving the ideological problem, but never did anything. He talked of a coalition in the Middle East, but his policies destabilized the entire region and gave rise to ISIS. He spoke of human rights and then made a pact with the greatest sponsor of terrorism in the world. He claimed the pact would prevent Iran from ever getting a nuclear weapon, and yet, the agreement virtually guarantees that result in ten years. He followed the agreement up with a huge delivery of untraceable cash that will allow Iran to buy an arsenal of nuclear weapons from North Korea should an opportunity arise. He did all of this while claiming that he thought of Israel as an indispensable ally. Hollow words-actions speak louder.
President Trump, in four short months has established new relationships with Middle East Leaders based upon action, trust and commitment. He has negotiated and signed an arms deal with Saudi Arabia that helps stabilize the region, enhances our national security, reduces the burden on our military, reduces weapons costs for our military and brings jobs to America. He has brought together leaders from 50 Muslim majority counties and negotiated a strategic vision to which they have agreed. He is providing the leadership to keep these leaders committed to the elimination of ISIS and the fight against the terrorist ideology. Actions speak louder.
President Obama said you could not defeat ISIS militarily and that you had to change the ideology. He did neither. President Trump has already produced significant military victories and dedicated a new Saudi computer center that will collect intelligence on ISIS and counter the ideological recruitment efforts of ISIS. Actions speak louder.
The Democrats, aided by a largely biased media have launched a verbal campaign to undermine our President. The reality they face is that President Trump is not diminished by their words. No amount of slander, accusations, or false reports from un-named sources can change this simple fact. President Trump is and will continue to be a man of action and a great President. President Trump understands that action and results are the appropriate measure of success. We finally have a President who can lead from the front-it’s the leadership that matters.
Trump and the Reagan Legacy
Virtually every Republican politician claims to be a Reagan Republican. Yet few of them understand the real legacy of Reagan and fewer still act in the manner they proclaim.
Ronald Reagan understood that the struggle for freedom is not a struggle between different political parties, different races, or between anything else that seems to divide us. Reagan understood, as did the founding fathers, that the struggle for freedom is between the people who want to be free and an overpowering government that seeks to control and exploit them.
One of Reagan’s favorite sayings was that “the ten most dangerous words in the English language are I’m from the Government and I’m here to help you.”
The founding fathers gave us the Constitution because they knew that throughout history there had always been and there would always be people who would seek control and power over other people to exploit them.
In this election cycle Donald Trump is the candidate most like Reagan and the candidate most like what the founding fathers wanted. Here are the facts to support the assertion.
Trump is the one candidate who understands that he would work for the people. Yes, other candidates speak more eloquently and say this frequently, but they are all career politicians who have ties to special interests, big banks, super-pacs and the RNC elite.
Trump is the one candidate who would be a “citizen president.” He has no ambition for a political career. He would serve his term and go back to his private life just as the founding fathers expected.
Trump has largely limited himself to those issues that the Constitution says are the obligations of the President. These are national defense, international trade and law enforcement (immigration law).
In contrast Cruz and Kasich have inserted themselves into many issues that go beyond the limits of the Constitution.
Cruz considers himself to be a strict constitutionalist. He has argued successfully in front of the Supreme Court. By all measures, he is an expert on the Constitution. Yet, he is incapable of avoiding typical political hypocrisy. When the Supreme Court struck down California’s proposition on the definition of marriage and hence part of the Defense Of Marriage Act (DOMA), Cruz was upset. He spoke out against the Supreme Court for denying the states right to define marriage, but turned around and tried to mitigate the result by introducing more Federal Legislation on the subject of marriage while arguing that marriage is a state’s rights issue. To the best of my knowledge, he has never claimed that DOMA violated state’s rights and hence the Constitution. This behavior suggests that Cruz is willing to ignore the principles he so adamantly expounds upon when things don’t turn out the way he wants.
Kasich’s approach is not so nuanced. His approach to limiting Federal Power is to take the money for the Federal program and give it to the states. This, of course, leaves the Federal Government in control of the level of funding and hence in control of the program. His approach fails to recognize and acknowledge how government controls many things through control of funding. One of the most glaring examples of this is the federal control over our universities through federal control of college funding and student loans.
One of the most striking things about this election cycle is that so many people believe our country is going in the wrong direction. This percentage has been as high as 68% and consistently in the low to middle 60’s as a percentage.
The American people have come to understand that both political parties are guilty of constantly increasing the size and scope of the Federal Government. In spite of the Tea Party successes, nothing has changed. For all his blustering, Cruz hasn’t changed anything of substance.
Donald Trump has given a voice to the people who now understand, as Reagan understood, that the government is the problem. He, and these supporters, have understood that the career politicians, supported and controlled by the two political parties and special interests, are the root cause of an ever expanding Federal Government.
Cruz and Kasich talk the talk but do not walk the walk.
Donald Trump walks the walk. Because he does, he is continuously attacked by everyone who is part of the machinery that maintains this excessive government control. Despite these attacks, he has stood his ground and not changed the things he believes. This is leadership. It is the reason his supporters are so loyal.
Ironically, Trump may lose the election because he has not learned to talk the talk.
In keeping with the concept of this website, ask yourself if the size and scope of government is an economic issue. It should be obvious that it is. If you would like to understand why and be able to explain it to other people, you should read through earlier posts and other menu items. A good place to start is here.
Happy Constitution Day
On September 17, 1787 The Constitution of The United States of America was signed into existence. Since that time things have changed a little. There are many who consider the Constitution to be the Supreme Law of the land and favor a strict interpretation of the document. Sometimes you will hear these people referred to as strict constructionists. On the other extreme there are people who consider the constitution to be nearly irrelevant and refer to it as a “living document”. Sometimes you will hear these people referred to as Harvard Law Professors. (sorry, I couldn’t resist)
But, please allow me to present a personal perspective.
Throughout the recorded history of the human race, there has been a recurrent theme of people rising to power and using that power to go out and conquer and enslave other people. In ancient times you think of the Greeks, the Spartans, the Egyptians, the Romans and the Ottoman’s . In more recent times you might point to Imperial Japan, and The Third Reich.
If you expand the analysis to include commercial and political coercion in addition to brute military force, you can point to the British Empire and the colonization of the Americas.
But, in spite of the less admiral events in the founding of America, the Founding Fathers managed to do something quite unique in the history of man.
The Founding Fathers, as well as all of the Patriots of the day, left us a rich legacy of documentation telling us the answer to the crucial question of WHY they believed as they did and what their objectives were in establishing our current government.
This body of works is not one-sided. It includes documentation created by those who supported the formation of a Federalist government as well as those who opposed it.
While we understand that the founding of our current government was unique in its identification, support and protection of natural human rights, we must understand an additional fundamental truth. The Founding Fathers understood the fragility of the government they created and its reliance upon the basic goodness of those to whom its preservation would be entrusted. They sought to provide the American people, the people who would be the governed, with the understanding and the tools to protect their freedom. But, in doing so, they also exposed the weaknesses of the government to those who would exploit those weaknesses to seek power for their own gain.
And so, what we see in America today is the same history that has played out throughout the history of mankind. Those who seek power remain active and work to increase their power over others. The history of the Constitution over the past two centuries shows a slow but steady progress of undermining the strength of the Constitution and an erosion of the protections that were created to protect individual freedom.
The defense of our freedom requires that we educate, or perhaps re-educate ourselves, about our basic human nature and the rules that govern our own behavior. We must understand the fundamental truths that the Founding Fathers provided for us. Then we must work to pass this knowledge and understanding to our children and grandchildren. We cannot rely upon our government to do this. It simply is not in their best interest to do so.
The Third Law of Natural Economics
Since the second LAW OF Natural Economics states that human nature provides a good model with which to analyze economics, we are naturally led to ask what characteristics of human nature are relevant. Is there an aspect of our nature that compels us to behave in a certain way when we choose to expend our natural resources in pursuit of an economic result?
If you look around you and examine how people are using their time and energy you will see an immense variety of pursuits. We might make judgments about these activities saying that some are productive while others are a complete waste of time. If you examine your own behavior honestly you will probably be able to make similar judgments about your own activities.
We can also recognize that we can be influenced by many circumstances and other people operating in in our environments to behave in particular ways.
When we think about the vast array of human behaviors in can be difficult to find common threads that hold true for all circumstances. It is easier to find common threads when we examine our behavior free from other influences. If we can describe this kind of law, we would expect it to hold true even when we are influenced by other things. Basic behaviors are just easier to find if we think about how we behave without outside influences.
Having examined human behavior from this perspective, I have discovered the third law to be as follows.
The Third Law of Natural Economics
Left to their own devices, human beings, both good and evil, will behave in a way that benefits their personal definition of a better quality of life.
This does not say that we always do what is best for us. If that were true, I might never eat chocolate or drink beer. But, if I think that eating things that I enjoy benefits my quality of life, I would eat or drink those things in spite of any negative effect. When my weight becomes excessive, I may eventually decide it benefits my quality of life to try to lose some weight.
Notice that the third law allows for the idea that people do not always do what is in other peoples’ best interest either. You might think of this idea as a loose description of the difference between good and evil. Ultimately, you need a system of values to make judgments about what is good or evil. We will talk about that in future blogs. If you would like to see a set of values based upon natural considerations and one which is consistent with the natural laws of economics, you can find them on this web site. They are called Natural Law Principles and can be found by following the Natural Law link at the top of the web page. The concept of good and evil becomes an important consideration when we go back to the real world where we can be greatly impacted and influence by the actions of other people. It is important to understand the difference between behaviors that are subject to value judgments and those which are truly universal.
A natural law should be universal. It should hold true for all people and all circumstances. If it is universal, if all people behave according to its basic idea, then no one should have cause to make a value judgment about the law and simply be able to recognize its truth.
I have examined a great many different human behaviors, some I consider good, others I consider evil. I find that the differences in human behaviors are accounted for by each individuals understanding of their personal idea of quality of life for themselves.
I encourage you to think about this as well and see if you can understand the fundamental truth of the third law.
Consider the following as an example. Many conservatives will tell you people who own and operate businesses are serving the public good by creating jobs and opportunities. Many liberals or progressives will criticize the same people for failing to hire more people, paying them too little, and accusing them of being greedy. Are they greedy or are they acting in the public good? That is a value decision and does nothing to diminish the fact that regardless of my value judgment or yours, the business owners are most likely operating in a way that they believe improves their life. Perhaps, they are at a point in their life when the profit is more important. Perhaps they have achieved enough that they feel they can give more back to the community and find that will improve their quality of life by doing so. In either case they would be acting according to the third law.
Federal Budget B. S.
There is a basic element of deceit that is a part of every discussion about the Federal Budget.
The simple fact that distorts every discussion is the fact that everyone in the Federal Government uses the same basic assumption about government spending commonly referred to as the ” baseline budget” or sometimes as the Congressional Budget Office Baseline.
Somewhere along the line Congress made a conscious decision to assume that government spending will increase each year. When anyone talks about cutting the budget, they are talking about cutting spending below the assumed spending and not below the current spending.
To understand the true impact of this, you must understand what the assumption for Government spending is. Here are the numbers provided by the Congressional Budget Office (CBO). The CBO uses a ten year time frame to describe its assumptions. In 2012 the CBO is estimating that the total Federal spending will be $3.6 trillion. If we were to say that Federal spending was going to stay constant, we would say that the baseline called for $36 trillion in spending over the next ten years. The actual CBO assumption, or the baseline budget, calls for a total of $44.4 trillion to be spent over the next ten years. Thus, the CBO is assuming that the Federal Government will increase spending by $8.4 trillion over the next ten years.
This assumption creates a lot of distortion in budget discussions. It is not the politicians who are confused. The object is to confuse you and make you afraid of cutting spending thus ensuring that the size and scope of the Federal Government will continue to grow each year.
Consider the fact that President Obama’s description of a comprehensive deficit reduction plan was talking about spending cuts on the order of $3 trillion to $4 trillion over ten years. These anticipated “cuts” would actually grow the size of government by $4 trillion to $5 trillion over the next ten years. Is it any wonder that we find ourselves deeper in debt every year?
Even Paul Ryan’s budget proposal which is considered by many to be extreme and catastrophic would continue to grow the size of government . The best estimate I have heard is that his proposal calls for approximately $7 trillion in “cuts” over ten years which is actually and increase in spending of approximately $1.4 trillion.
The simple reality is that any proposal which cuts less than $8.4 trillion isn’t a cut at all.
If we ever expect to have a fiscally responsible government, we need to learn how to hold them accountable and make them tell the truth about their budget proposals. We also need to educate and hold the media accountable so they learn how to confront politicians in a truthful manner.
While watching MSNBC during the Republican National Convention, I witnessed one of their “personalities” describing how it was physically impossible for the Ryan budget to cut $7 trillion dollars from the budget. I will give this person the benefit of a doubt and suggest that they simply don’t understand the concept of baseline budgeting. As I described earlier, the Ryan budget still increases federal spending over the CBO budget time frame.
You can help by educating yourself, which you just did by reading this, by educating your friends and family and by educating your favorite media outlet via emails and tweets.
Justice Robert’s Great Hypocrisy
Justice Roberts did not begin the destruction of America and he certainly won’t be the last person to contribute, but there can be no doubt that he put a nail in the coffin today.
You don’t have to be a constitutional lawyer to understand the hypocrisy of his ruling. All you need is a little common sense.
How can it be unconstitutional to order me to buy something and at the same time be constitutional to tax (penalize) me for not buying it?
The lawyers and politicians will want to get you hung up on some technical or legal distinction between a tax and a fine. That is not the issue.
Justice Roberts recognized that forcing me to buy health insurance was beyond the almost unlimited powers of the commerce clause. He recognizes that the purpose of the constitution is to place at least some limits on the Federal Government.
In the same ruling he “gave” the Federal Government unlimited power to do anything it wants through the process of taxation.
This is the great hypocrisy. The government can now tax me if I don’t buy the food they think I should eat or drive the car they think I should drive.
They can disguise almost anything as a tax. If I live in a county that doesn’t vote the way they want me to vote they can find some characteristic of that county that enables them to tax the residents. Perhaps we own to many SUV’s or have too many old people or too few illegal aliens. Perhaps we own too many guns or have a Nascar track. Perhaps we grow tobacco, mine coal or have a higher percentage of wetland property. Perhaps we have too many single family homes and too few apartments. Perhaps our local college has too few foreign students.
The point is that the government has an ever greater and more restrictive role in our lives that is counter to a free society.
Today it got more power in a far greater way than it has in recent times.
NEW YEAR’s Resolutions
OK. It’s that time again. We have all indulged, over-indulged and otherwise gotten off track.
What track did you get off?
The question is not an idle question. Do you have a track?
Most of us think of our new resolutions in terms of our most recent behavior. We ate too much over the holidays-we should try to lose weight. We spent too much, we need to stop spending and try to reduce our debt. We drank too much-let’s behave better.
Those are all good things, but they really fall short of your potential for success in the coming year.
Setting personal goals is an extremely important part of achieving the success you want to have in your life. Effective goal setting requires a more concerted effort than most people apply.
What if instead of saying you would lose 20 pounds, you set a goal to manage your weight over the next year? This goal requires you to know how much weight you want to lose. This goal would require you to pay attention to your weight and make adjustments to your eating habits and exercise habits as you went forward. In doing this, you would not only be able to make the choices required to lose the weight, you would recognize when you were getting off the track and be able to make smaller corrections without feeling so overwhelmed.
There is no area of your life in which effective goal setting is more necessary than in your personal financial and economic health.
The reason this is true is because everything you do or do not do has an economic impact in your life. The younger you are, the more impact they have.
I know. Most people think that because you are young, you have more time to “make up” for whatever mistakes you might make. While this is true, the opportunities you miss when you are young make it far more difficult to reach your goals as you get older. Doing it right from the beginning makes it much, much easier.
Effective goal setting requires you to have very specific long term, intermediate term and short terms goals. If you don’t know what your long term goals are, you have no hope of making a good decision that supports those goals.
If you have specific goals that are aligned for all time frames, you will be able to make specific plans for achieving your shortest term goals with the full confidence that the actions you are taking are going in the direction you ultimately want to go.
I would suggest the best New Year’s Resolution you can make is to decide that you are going to establish goals for yourself and manage your decision making to achieve those goals. The first step for you to take is to write down your long term, intermediate term and short term goals. Then make a specific action plan to achieve or exceed your short term goals and manage your activities to accomplish that.
If you do this, you will be very happy when you sit down to update your goals for next year’s resolutions.
The Second Law of Natural Economics
When you understand that the only source of economic activity and economic growth is the act of people using their personal labor resource, you can make the intellectual leap to the next logical result.
Every economic action relies upon a decision by a human being.
As it turns out, people are far more predictable than any statistical model of the economy. In fact every statistical model of the economy tries to predict what people will do when some external stimulus is applied.
The problem with most economists and most statistical models is they ignore the actual decision point in preference to an analysis of various charts, graphs and some dubious equations. They stop thinking like the rest of us and begin thinking like statisticians.
The reality is that basic human nature provides a far more consistent and predictable model for understanding economic events or non-events than does any statistical model.
In our current economic environment, there is a glut of houses for sale at very reduced prices – plenty of supply. We are also continuing to produce the same number of people graduating from high schools and college and thus have the same number of people available to start new home situations – plenty of demand. Economists call this new demand “household formation”. A classic approach to the economy would predict that the housing market should be improving.
Some economists, realtors, builders and investment advisors and media pundits have been predicting a bottom to the housing market.
The rest of us know that isn’t likely to happen for a while. We know that our personal situations do not encourage us to buy a new home. It doesn’t matter how “affordable” a house might be in the classical sense. We aren’t buying.
The reality is that our own personal understanding and the way we make decisions is pretty much the same for all of us. It is simply a matter of human nature.
Thus, the Second Law of Natural Economics states that human nature provides a predictable model for understanding how large economies will behave.
AN OUNCE OF PREVENTION
The Christmas season is a very special and happy time for a lot of people. I would hope that it is so for everyone.
I am going to be a little bit of a Grinch, so let me first extend my most sincere wishes for a Merry Christmas, Happy Holiday and all other appropriate personal and cultural greetings for the time.
This is one of the times when we become most vulnerable to our emotions in terms of our spending habits.
It is a time when the peer pressures and social pressures that drive us to spend more than we can afford are the strongest. There are even media types who suggest that we have a civic duty to spend freely because it will help the economy.
If you are running up your credit card debt, I would urge some caution. Come New Year’s when you are faced with the overwhelming debt and buyer’s remorse, it will be too late.
I know that as parents and grandparents, husbands and wives, brothers and sisters; that we want to give to those who are special to us. We are, if nothing else, a generous people.
Please consider the impact that this added debt will have in your personal life next year.
What will the added debt do to your progress toward achieving your American Dream?
If you and your spouse spend the next six months arguing over the finances, will your child be consoled and feel secure because they got the latest toy for Christmas?
Will the pleasure you feel Christmas morning be enough to overcome the physical stress and anguish you feel because of your debt next year?
If the bank repossesses the Lexus, will your significant other be impressed?
Diamonds may be forever, but the credit card debt may outlive your possession of them.
There are many ways to celebrate your specific holiday without destroying your personal financial health. Many people would argue that these celebrations are far more personal and meaningful than lavish gift giving.
And if you are fortunate enough to be able to afford a lavish holiday, please stop and think about those who are not as fortunate.
There are many organizations that can help you find a needy family or two to help. You can do it personally or anonymously. You can participate individually or with a group.
Please extend your generosity to those who need it most.
"Me? An Economic Expert"