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Ben Stein's mistake

Ben Stein is a smart guy.

He has a degree in economics from Columbia University and was valedictorian of his class at Yale Law School.

He has worked as a White House speechwriter and lawyer, an economist, a trial attorney and a teacher. He has written thirty books, some screenplays, and columns for highly respected newspapers and magazines.

This proves that you can be very, very smart and still be very, very wrong.

Today on Fox News, Ben Stein was asked by Megyn Kelly what he thought about President Obama's unscripted comment this week during remarks about financial reform. "I do think," the President of the United States said, "at a certain point you've made enough money."

Ben Stein said the president was totally wrong, and then he made the mistake. He explained why the president was wrong.

Mr. Stein said wealthy people keep what they need for a nice life and give the rest to charity.

That's a mistake, but not for the reason you're thinking. The statement may be completely true, and for the sake of argument let's assume that it is.

The mistake is in accepting the premise that wealth is immoral unless it benefits people who didn't earn it. That premise leads to the conclusion that government has a legitimate interest in taking wealth from some people in order to benefit other people. You can argue that morality is not the province of government, but you have already conceded that something immoral is happening and now you're in the position of arguing that government should do nothing about it.

This is exactly how the Republicans get into trouble with the voters. They concede the premise that wealth is immoral unless it benefits people who didn't earn it. The premise is embodied in the phrase "trickle-down economics" and in the Biblical admonition, often quoted by President George W. Bush, "To whom much is given, much is expected."

Here is a different argument to make against "I do think at a certain point you've made enough money": The statement justifies unlimited government power over individual rights and private property, and that is the end of freedom in America.

Under the U.S. Constitution, it is none of the government's business whether you need what you have. The power of the government is limited. Individual rights and private property are protected. That's what makes this a free country. Freedom is not an accident of history or a supernatural phenomenon that can't be fully understood by mortal men.

If the American people allow government officials to interpret the Constitution in a way that removes the limits on government power, our freedom will be a casualty of our good intentions.

George Washington warned us about this in his Farewell Address. "If in the opinion of the People, the distribution or modification of the Constitutional powers be in any particular wrong," our first president said in 1796, "let it be corrected by an amendment in the way which the Constitution designates. But let there be no change by usurpation; for though this, in one instance, may be the instrument of good, it is the customary weapon by which free governments are destroyed."

There's a reason Washington's portrait hangs in the Oval Office.

Under this administration, it's a dartboard.


Copyright 2010

Source note: Washington's Farewell Address can be read online in the archives of the University of Virginia at this link: http://gwpapers.virginia.edu/documents/farewell/transcript.html

Editor's note: You might be interested in reading "Defending Capitalism" and "The Tyranny of the Children" at www.SusanShelley.com and in the 2008 post, "Barack Obama: 'We don't mind'" and the 2007 post, "Barack Obama explains socialism."


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In defense of the banks

Politico.com has a story today by Jeanne Cummings and Chris Frates headlined "No one marching for the banks."

It reports that the AFL-CIO plans to lead marches down Wall Street next week in support of President Obama's financial reform proposal. Ten thousand people, organizers claim, will march on Wells Fargo and Bank of America.

JP Morgan Chase asked its employees to write their congressmen and senators to tell them that over half a million people who work in the financial services industry would be adversely affected by some of the proposed changes in the law.

"It’s unlikely that rallying cry will spark much of a popular uprising against the financial regulation reform legislation," Politico reported. "If anything, it underscores the inability of the Big Banks and their allies to latch onto a phrase or argument that could resonate with the public and provide the industry’s Republican defenders with the leverage to reverse the momentum in the regulation fight."

Oh yeah? Is that a dare?

How's this:

In Defense of the Banks

By Susan Shelley

Everyone should be able to get a loan, and no one should have to pay it back.

That's the Obama Doctrine on financial reform.

Banks should be making loans to folks who want to buy cars and houses and start small businesses, and if the folks can't pay back the loans because they're struggling, the banks should make modifications to the loans.

Why should the banks do this?

Because bankers are dastardly evil villains who stole your money for high living and good times.

AmericaWantsToKnow.com predicted in a 2008 post titled "Hank Paulson's casting call" that the Troubled Asset Relief Program bailout, which was forced on all the major banks whether they wanted the money or not, was a slick trick to shift the blame for the foreclosure crisis to the banks and away from the politicians who created incentives and guarantees that caused traditional lending standards to be abandoned.

After all, lending standards cause people to be turned down for loans. Banks typically can't stay in business by making loans to people who don't have the ability to pay them back.

Unless the federal government guarantees the loans.

Then it's no problem at all to make loans to people who can't pay them back, because the government promises to pay the bankers with your tax dollars if the borrowers default. That way, politicians get credit for helping struggling folks buy homes.

And when the folks don't pay and the government makes good on its guarantee and gives tax dollars to the bankers, guess what?

The bankers are dastardly evil villains who stole your money for high living and good times.

If you own a home and you're older than five you probably remember the days when you had to take a wheelbarrow to the mailbox to carry all the solicitations for home equity loans, refinancing loans, second mortgage loans and home equity lines of credit. Some of them came with a pre-printed check attached to a cheery message: Just sign it and deposit it and buy yourself a vacation, a new car, a new kitchen, whatever you want! There was small print on the back but, you know, life is short.

A lot of people spent their home equity as if it was a monthly check from the California Lottery.

A lot of people gambled and bought houses and condos as a get-rich-quick investment.

A lot of people were shocked and dismayed when home values declined.

Some of them put the keys in the lock, called the bank and said, "Come get your house."

But so distorted was the mortgage market by implicit and explicit government loan guarantees that financial institutions all around the globe had purchased mortgage-backed securities in the belief that they were completely safe.

When it turned out that they weren't, the panicked Bush administration pressured Congress for an $800 billion bailout fund to buy up the "toxic" securities and prevent a worldwide financial collapse.

The TARP fund never did buy up the troubled assets. The money was pushed out to "stabilize" the banks, against the will of the banks in many cases.

So let's be clear. If anybody took your money for high living and good times, it's not the executives of the major U.S. banks. It's the folks who are now struggling after borrowing money they never should have been loaned in the first place.

Cold, but true. Not all, but many of the people who are threatened with foreclosure borrowed recklessly and bought a nicer house or blew the money on fun stuff they couldn't afford any other way.

Now President Obama and the Democrats in the House and Senate are trying to reform financial regulations with the stated goal of maintaining financial stability in the future.

When you are on the wrong premise, Ayn Rand wrote, you will always achieve the opposite of what you intend.

Here's one premise: the banks must ease their lending standards to make more loans and must modify the existing loans of customers who are struggling.

Here's another premise: the banks must maintain sound lending practices and hold their customers to the contracts they sign.

On which premise are we more likely to achieve financial stability, and on which are we likely to achieve the opposite?

History has the answer, and you don't have to look back too far to find it.

Of course, President Obama and the Congressional Democrats may not intend to protect financial stability as much as they intend to protect their own power to pressure the banks into doubling as social welfare agencies.

The proposed financial reform bill would give the executive branch of the federal government the power to pre-emptively close down any bank or non-bank financial institution if government officials believe it poses a systemic threat to financial stability. Without any benchmarks, standards or specifics, simply on the say-so of a politician or his appointee, a financial conglomerate could be threatened with an immediate liquidation that would wipe out the debt-holders, the shareholders, and the employees.

Government officials who have that kind of power won't even have to ask for what they want. Financial institutions will be working day and night to find ways to please them.

Here's a premise: President Obama and the Democrats want to have unlimited, invisible and unaccountable power to force the titans of the financial industry to do whatever they say.

That must be the right premise. The plan they have drawn up will achieve it perfectly.

April 24, 2010

Editor's note: "Hank Paulson's Casting Call" was posted to AmericaWantsToKnow.com on October 17, 2008.

Copyright 2010

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Portrait of a volcano

America Wants To Know reached the boiling point last month after one too many conversations with friends and relatives who happily, even eagerly, accept the idea that the federal government must take over anything that seems too difficult or expensive for ordinary people to manage on their own.

Late at night, we went to the Meetup.com website and signed up to organize a group called "Freedom-Loving Fiscal Conservatives of L.A."

At the last click of the set-up, we chickened out. But a couple of weeks later, boiling again, we clicked it.

A few days went by and then Meetup sent out an e-mail to let other members know that the new group had been formed.

This is a screen shot of my e-mail inbox after that message went out.


Click the picture to view full-size.

Between 6:04 p.m. on Saturday and 3:00 p.m. on Sunday, 39 people joined the group.

If this is happening in Los Angeles, imagine what's going on in Des Moines. And Cincinnati. And Pittsburgh.

You won't have to imagine much longer. November is coming.


Copyright 2010

Editor's note: You might be interested in the previous posts, "Retiring Henry Waxman" and "Rep. Brad Sherman braves town hall meeting."

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Rep. Brad Sherman braves town hall meeting

Iran's nuclear program is a far greater threat to Israel than the Obama administration's "tiff" with Prime Minister Benjamin Netanyahu, Rep. Brad Sherman (D-CA) told a hastily scheduled town hall meeting at a synagogue in Woodland Hills, California, Wednesday night.

Sherman compared the drive for sanctions against Iran to "a car that's been going 5 mph for the last 13 years," and now "needs to go 85." He said under the Obama administration "the car's going 7 mph instead of 5 mph" and lamented, "This president is doing a very little bit at the very last minute."

The congressman from California's 27th District, which includes part of the east San Fernando Valley area of Los Angeles, passed up several opportunities to offer full-throated support of President Barack Obama.

Sherman said the president ought to speak out personally against the Palestinian Authority's incitement of hatred against Israel in its media and its schools. He said it should be denounced "at the highest levels, not relegated to lower-level folks at the State Department."

Asked why the president has not yet visited Israel, Sherman answered flatly, "I don't know."

Asked if the president feels as strongly as he does about the danger of Iran's nuclear program, he answered, "No president has felt as strongly as I do."

Asked why the White House did not condemn the recent renaming of a public square in the West Bank in honor of a Palestinian terrorist, Sherman said, "It should have been condemned at the presidential level and it wasn't."

The biggest applause of the evening came in response to the question, "Given President Obama's treatment of Israel, do you think more Jews will vote for the GOP?"

Sherman smiled at the raucous reaction and said he was confident that the people applauding had not voted for Obama the first time. Temple Aliyah's Rabbi Stewart Vogel asked Sherman if he would like to poll the group, and a show of hands revealed the crowd of approximately 300 people to be about 40 percent Obama voters, by Vogel's estimation.

Questions were submitted in writing and the congressman did not take questions on any other issues, inviting the audience to bring their concerns about health care and taxes to his next scheduled town hall meeting on July 11.

Sherman concluded by reminding Rabbi Vogel and the audience that fifteen members of Congress live within driving distance of their location. "I came," he said. "I don't know whether the other fourteen would have or not."

Temple Aliyah is located in the 30th congressional district, which is represented by Democrat Henry A. Waxman.

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That's the news, brought to you by your faithful correspondent, America Wants To Know, who was personally in attendance at this town hall meeting. We can tell you that it was a courteous crowd of concerned citizens without activists, protesters, interruptions, or fights.

Until now.

It was disturbing to hear a member of Congress minimize the significance of President Obama's condemnation of Israel over the announcement of new housing construction in Jerusalem. It was troubling to hear him dismiss the humiliating treatment of Israeli Prime Minister Benjamin Netanyahu during last week's White House visit.

"A tempest in a teapot," Rep. Sherman said repeatedly. "Five years from now, nobody's going to remember it."

Whether anyone remembers it or not, the damage will be done. The message will be sent to the world that Israel is a bad actor, and therefore hostility to Israel is justified and appropriate.

The message will be sent that Hezbollah terrorists firing rockets over Israel's northern border and Hamas terrorists firing rockets from Gaza have a good point.

The message goes out that Israel's conduct is so egregious that even the United States can't take it anymore.

Is that a message the United States of America ought to be sending?

For one thing, it encourages every anti-Semite on the planet to come out of the dark and share his thoughts live on C-SPAN's call-in shows.

More importantly, it undercuts the strength of diplomatic language. How effective is it to characterize Iran and North Korea as outlaw nations defying the will of the "international community" for building nuclear bombs after you've characterized Israel the same way for building apartments?

Congressman Sherman emphasized that Israel receives $2.8 billion in armaments annually as a gift from the U.S. taxpayer. Actions, he said, speak louder than words, and regardless of the words that have come out of the Obama White House, not one penny in aid to Israel has been cut or will be cut.

The trouble with this analysis is that it ignores the many times the U.S. has asked Israel to stop fighting before it defeats its enemies. It ignores the many times the U.S. has called on Israel to sit still and take one for the team.

Remember the Scud missiles during the first Gulf war? Saddam Hussein fired missiles at Israel and the U.S. begged Israel not to do anything in retaliation, fearing it would open rifts in the coalition built by the first President Bush to drive Iraq out of Kuwait.

That's just one example of many.

Every time Israel is threatened or attacked it is ready to go to war, and every time it doesn't go to war you can bet your U.S. tax dollar that our government has promised Israel arms and technology that will be sufficient to defeat the arms and technology we just sold the Arabs.

So let's not spend a lot of time whining that Israel's taking advantage of the U.S. taxpayer. We're paying them to teach their kids to use gas masks while they leave our Arab friends standing.

Why?

Probably because we fear that if these repressive regimes in Saudi Arabia and Egypt and Syria fall, al-Qaeda or its equivalent will control the world's oil supply.

There's always a reason.

Maybe even a good reason.

But just because we have to prop up these hideous regimes doesn't mean we have to stroke them and like it.

If they choose to keep themselves in power by diverting resentment and wailing to their populations that Israel is the enemy, the United States doesn't have to jump to its feet and shout, "Boy, howdy!"

We could treat Israel with the respect that's owed any free country.

And we would, if the Obama administration respected freedom.

Every day there's less evidence that they do.


Copyright 2010


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Retiring Henry Waxman

If you thought it was delicious to replace Ted Kennedy with Scott Brown, you're going to love this fall's election in California's 30th Congressional District.

That's the Westside Los Angeles district currently represented by Rep. Henry Waxman. Don't know him? He's the surly thug who said during a hearing on the cap-and-trade climate bill that a reluctant public, like an uncooperative foreign government, has to be motivated by both carrots and sticks.

You can see it here on YouTube (about 4:22 into the clip):



The punitive Mr. Waxman made the comments to former House Speaker Newt Gingrich, who was testifying that the cap-and-trade plan, which would discourage energy use with higher energy prices, would hurt the economy, increase unemployment, and raise the cost of living for American families.

"Mr. Gingrich, I'm sure glad you're not in charge of foreign policy," Rep. Waxman said. "Do you think the only way to incentivize a country is by offering them more and more carrots? You have to have some threat. And sometimes you have to say, 'To incentivize you, we're going to give you some assistance, but there are going to be consequences.'"

Newt Gingrich looked like a man who had just been handed the winning card in a game of gin rummy.

"Mr. Chairman, I don't think of American citizens the way I think of foreign dictators," the former Speaker of the House answered, "And I don't think this Congress should punish the American people. I think this Congress has every right to reward the American people, but I don't think Lincoln's government of the people, by the people and for the people should be turned into a government punishing the people, and that's a major difference."

Alas, Mr. Gingrich's words were not persuasive to the resentful man with the gavel. He rammed that cap-and-trade bill through his committee and helped to ram it through the House.

"You have to have some threat." That's the Waxman philosophy. When people won't do what you tell them to do, "there are going to be consequences."

After too many years in Congress, Henry Waxman has forgotten that his title is "Representative" and thinks it's "Executioner."

The chairman set up his guillotine on Capitol Hill last year to intimidate insurance company executives. Mr. Waxman sent a flood of angry letters to insurers demanding to see company records documenting salaries, stock options, company perks, conventions and retreats, claims, administrative and marketing expenses, and profits.

Last week the chopping block was put up again, this time for the top executives of AT&T, Verizon, Caterpillar and Deere. The companies had just disclosed to shareholders that the health care reform law will cost them tens or hundreds of millions of dollars and may result in changes to the benefits currently provided to retirees and active employees.

Mr. Waxman was enraged by this and promptly sent letters to the companies' CEOs, demanding to see their accounting documentation and their e-mail correspondence. He told them to show up in front of his committee on April 21 to explain themselves.

What kind of an attitude is this in a free country?

Henry Waxman is not the principal of a middle school, and corporate executives are not drug dealers on the playground, and the American people are not truant twelve-year-olds.

The U.S. Constitution limits the power of the federal government, and arrogant power-lusters like Henry Waxman are the reason. When you watch him in action you can almost hear the voice of James Madison yelling, "I told you so!"

Madison made sure the members of the House of Representatives went home to their districts every two years to face the voters.

In the 30th Congressional District of California, where America Wants To Know happens to live, something new is waiting for Henry Waxman when he comes home to campaign.

A Republican challenger.

In the district that includes Hollywood, Beverly Hills and Malibu.

This is not an April Fools joke.

In June there will be a Republican primary in the 30th Congressional District and the man who's likely to win is David Benning, a pro-business candidate who supports a reduction in payroll taxes and lower corporate taxes. He believes that unpredictable future tax rates are hurting the economy and stifling growth. He favors policies that expand employment instead of policies that expand government and deficits.

Imagine replacing Henry Waxman with a pro-business Republican. Imagine pro-growth legislation on Capitol Hill and the guillotine on eBay.

Here's the link to David Benning's campaign web site:

www.BenningforCongress.com

And here's the link where you can chip in for Henry Waxman's retirement party:

https://www.fundraisingbynet.net/fbn/contributeFederal.asp?guidRegistration=5C5C5B58

Go ahead. Buy a balloon or two. The neck you save may be your own.

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