A Good Reason To Get Obama Out of Office

OK, there are lots of reasons to get Obama out of office.  The problem is, that for most of them, I have no reasonable hope that Romney will be any better.  Corporatism?  CEO as Venture-Capitalist-in-Chief?  Indefinite detentions?  Lack of Transparency?  The Drug War?   Obamacare, which was modeled on Romneycare?  What are the odds that any of these improve under Romney, and at least under Obama they are not being done by someone who wraps himself in the mantle of small government and free markets, helping to corrupt the public understanding of those terms.

But here is one issue Obama is almost certainly going to be worse:  Bail outs of states.  States will start seeking Federal bailouts, probably initially in the form of Federal guarantees of their pension obligations, in the next 4 years.  I had thought that Obama would be particularly susceptible if California is the first to come begging.  But imagine how fast he will whip out our money if it is Illinois at the trough first?

Now that Chicago's children have returned to not learning in school, we can all move on to the next crisis in Illinois public finance: unfunded public pensions. Readers who live in the other 49 states will be pleased to learn that Governor Pat Quinn's 2012 budget proposal already floated the idea of a federal guarantee of its pension debt. Think Germany and eurobonds for Greece, Italy and Spain.

Thank you for sharing, Governor.

Sooner or later, we knew it would come to this since the Democrats who are running Illinois into the ground can't bring themselves to oppose union demands. Illinois now has some $8 billion in current debts outstanding and taxpayers are on the hook for more than $200 billion in unfunded retirement costs for government workers. By some estimates, the system could be the first in the nation to go broke, as early as 2018....

For years, states have engaged in elaborate accounting tricks to improve appearances, including using an unrealistically high 8% "discount" rate to account for future liabilities. To make that fairy tale come true, state pension funds would have to average returns of 8% a year, which even the toothless Government Accounting Standards Board and Moody's have said are unrealistic....

Look no further than the recent Chicago teachers strike. The city is already facing upwards of a $1 billion deficit next year with hundreds of millions of dollars in annual pension costs for retired teachers coming due. But despite the fiscal imperatives, the negotiation didn't even discuss pensions. The final deal gave unions a more than 17% raise over four years, while they keep benefits and pensions that workers in the wealth-creating private economy can only imagine.

As a political matter, public unions are pursuing a version of the GM strategy: Never make a concession at the state level, figuring that if things get really bad the federal government will have no political choice but to bail out the pensions if not the entire state. Mr. Quinn made that official by pointing out in his budget proposal that "significant long-term improvements" in the state pension debt will come from "seeking a federal guarantee of the debt."

I had not paid much attention to the Chicago teacher's strike, except to note that the City basically caved to the unions.  The average teacher salary in Chicago, even without benefits, will soon rise to nearly $100,000 a year for just 9 months work.  But I am amazed at the statement that no one even bothered to challenge the union on pensions despite the fact that the system is essentially bankrupt.  Illinois really seems to be banking on their favorite son bailing them out with our money.


  1. Erik Carlseen:

    I'd like to believe that the GOP would stop the state bailouts (if only for the politically opportunistic chance to starve their opponents coffers), but it seems like every time they get a chance to stick the fiscal knife in something like that they talk all tough and then back off when push comes to shove. Let's just face facts - the GOP is all talk when it comes to fiscal discipline. Even Reagan's actions were nowhere near his rhetoric.

  2. skhpcola:

    Your first paragraph belies your intelligence. I know that you are a smart guy, if not a bit addled when it comes to political ideology, but if you really are adrift and can't find any good reasons to vote against Obama, then you are more partisan than am I. You (and many other knee-jerk big "L" Libertarians) are just as bad on the political front as militant atheists are in their rabid denunciations of religion. That's the primary reason that rational conservatives view Ron Paul and his acolytes as mouth-breathing retards. I'd hope that the stifling regulatory environment that has been installed since Buhraq was elected would be enough to dissuade you from even considering *not* voting for Mittens, but I see that your dyspeptic worldview and cynicism is clouding your judgement. Pfft.

  3. skhpcola:

    Yep, Rethuglicans are all talk when it comes to fiscal discipline...that's why GWBoosh had recurring deficits of >$1 trillion. Oh, wait...he didn't.

  4. mark2:

    It is a problem the Republicans are not conservatives, and don't really believe in conservative economic principals. So you end up with Democrat control increasing the government power and reach really fast vs Republican control increasing it merely kinda fast. In the end GOP pushes out the road to hell a few years, but we still end up getting there.

    I do see some hope with the T-Party, some fiscally conservatives are being brought in and if Boehner doesn't corrupt them, this cycle there should be enough to push the GOP to fiscal responsibility just a bit more than before (and by fiscal responsibility I mean holding the line on spending, not increasing taxes so government can spend even more)

    I give Reagan credit because he got some of his plan through two congressional bodies which were aligned with the opposition party. Carter had some conservative principals to, but could not get them passed by his own party.

  5. mark2:

    Also I think the decision to elect Obama over McCain was the correct one. McCain was merely socialism light, and like the frog that does not notice the temp rising when it goes up slow, we probably would not notice the kinder Gentler socialism McCain would have given us, whereas with Obama, it is so blatant people can see and react.

  6. Matthew Slyfield:

    Here is the big issue with libertarians and the Rs vs Ds.
    Both parties originate from a schism in a single predesessor party (Bull Moose if I recall correctly). While there are significant differences between the two, anyone who suggests that they are polar opposites across the board is blowing smoke.
    I will usually vote for the Rs when it matters but from my perspective it is choosing the lesser of two evils.
    For anyone who truly cares about small government and fisical responsibilty the differences that matter between the Rs and Ds is only a matter of degree.

  7. Matthew Slyfield:

    GWBs deficits might have been smaller than The One's but durring the portion of his presidency when the Rs had control of both houses of congress he was no paragon of either fiscal responsibility or small government.
    The Rs in congress only stand by their small government / fiscal responsibility retoric when there is a party split either between the House and the Senate or between Congress and the Whitehouse.
    Vote for Rs in the House and Ds in the Senate or the other way around if you prefer. Long term, congressional gridlock is the best defense we have against growth of the fedral government.

  8. Erik Carlseen:

    Well, here's the challenge I throw out to Republicans who use this argument: Name one substantive policy difference between the two. Here's the catch: when Obama's or Romney's rhetoric contradict their actual governance, you have to go with their actions, not the cheap talk.

  9. Erik Carlseen:

    No, he merely ran nearly half-trillion-dollar deficits, which were record-huge at the time. Neither party pays anything more to the thinnest veneer of lip service to spending and deficits. There is nothing more tired and lame than political partisans jumping up and down like five-year-olds on a playground yelling "But he did it first or worse!" in order to excuse bad behavior and deflect accountability for their side's behavior. Also, Romney is promising to continue the trillion-dollar deficits - and he doesn't even have a specific budget out. The closest thing we have to a Republican plan is the Ryan plan, which Romney refuses to endorse because it's too radical for his taste. The difference in spending between Obama's 2016 plan and Ryan's 2016 plan (assuming the wildly optimistic growth projections that both use, and assuming that both get through Congress unscathed - which is almost comical) is just a hair under 10%.

  10. skhpcola:

    I completely concur. GWB had positive qualities, but fiscal discipline wasn't one of them. I am a reactionary conservative, but even *I* bad-mouthed Bush for his compromise of conservative principles in dealing with the Democrats. Most of my conservative friends did, too. But look, the last time that the federal government had a budget surplus was in the late '60s. The liberal trainwreck began long ago and has recruited Republican boosters along the way. Undoing the damage won't be quick and easy, but the primary objective is to get the Merry Marxist out of the White House and fire his henchmen in the regulatory hierarchy that have been destroying and/or squelching economic activity and the creation of wealth. Repugs may not always act like conservatives, but you can bet your ass that Dimocraps are *always* going to act like the tyrannical, filthy, power-grubbing bastards that they've been in the modern era. Even hinting that there's no basic difference between the two parties is naive and foolish and toolish.

  11. mesaeconoguy:

    Obama has proven insanely dangerous economically and legally
    – the GM and Chrysler bailouts are still yet to be recognized for the
    tyrannical acts they were, and the rest of his economic disaster has yet to play
    out (other than his growth-stifling piss poor recovery, worst on record).

    Sorry, you cannot take a chance on 4 more years of this

  12. obloodyhell:

    }}}} Both parties originate from a schism in a single predesessor party (Bull Moose if I recall correctly).

    You remember so wrong it's not even funny. This isn't just wrong, it's "wronger than wrong".

    The current "Democrats" date back to about 1825 or so, and Andrew Jackson. They were a breakup of the original "Democrat-Republicans" of Thomas Jefferson. The other segment quickly faded into insignificance.

    The modern Republicans were a completely new party created in opposition to slavery, and have no connection whatsoever to the old "Democrat-Republican" party.

    It's not like it's that hard to look this stuff up on Wikipedia, dude.

  13. obloodyhell:

    Was there any kind of actual argument intended to be in there to justify your disagreement, or was it always supposed to be a mindlessly idiotic exercise in ad hominem name calling?

  14. obloodyhell:

    This is where the term RINO came from and, in direct contravention, the Tea Party wing of the Republicans (which term now needs to be carefully examined as there is a group of the GOP connected to Michelle Bachmann who has disingenuously usurped that moniker for a completely "standard GOP" group... one reason I don't think much of Bachmann).

    True conservatives generally will aim to support the *legitimate* Tea Party candidates, who are aimed at fiscal conservative principles, and limited government.

    This group is far from dominant as of yet, however, so it's not like they can make sweeping changes if any legislature ever can.

    The notion that ANY Republican isn't almost always preferential to ANY Democrat is ludicrous. Offhand, the only "Democrat" I'd consider voting for is Lieberman, and that's because I think he's got principles even if I disagree with them, and that's so rare in politicians that it deserves respect. Note that he got thrown out of the Democratic party for those same principles... which is one of the primary reasons you can easily delineate between the two parties.

  15. skhpcola:

    I'm not a Republican, but neither am I a moronic Libertarian. If you can't discern the difference betwixt conservatism and modern liberal progtardism, that's not my problem.

  16. skhpcola:

    I generally agree with you, OBH, both here and on Mark Perry's blog and maybe Cafe Hayek, but if you buy into this wide-eyed "there's no difference between the known evil Ozero and Mittens" bullshit, then perhaps you aren't the one with the chops to try to spank me for calling out Warren on this.

    Fine, abstain. You and Warren both. This isn't the time to claim a superior intellectual or moral position. I voted for Harry Browne in '96, but the election was lost before it began. This one isn't. The disingenuous crap that Libertarians continue to pipe out is laughable. Mittens isn't a Tea Party candidate, but he isn't Obama. That should be the necessary and sufficient evidence. But if it isn't, enjoy the decline caused by your rigid ideology.

  17. skhpcola:

    Yes, apparently they can take a chance. They endlessly intone the 'care troll' mantra that Mittens isn't the ideal candidate or conservative. It's a dishonest and ignorant position from which to debate, but there it is. They (the wonderful Americans that keep pining for the Utopian candidate) will accept nothing less than the man or woman that satisfies their every desire. I'm a bit more pragmatic than that unrealistic stance.

  18. Matthew Slyfield:

    Wikipedia is not a reliable source.

  19. mark2:

    Bull, Wikipedia is as reliable as any encyclopedia. You just have to be careful when it comes to politically sensitive subjects - which you have to do with any media. You think Encyclopedia Britannica is any better on Global warming for instance?

    You saying because Wiki says that the GOP was built on the ruins of the Whig party, that that must now be a lie? That it says the larch is a tree means that it really must be an annual herb? What silliness you have concocted.

  20. LarryG:

    I've not seen any evidence that the Feds bail out states pensions. Has it happened before? Is Obama talking about doing it? Many states are currently in the process of converting their defined benefit plans to defined contribution. The Fed Govt converted their pension plans to defined contribution in about 1985 I believe.

    Now the Fed DOES take over private corporations pension plans when they bail out.... the PBGC and it's not an Obama creation.. it has been around a long time.

  21. mark2:

    They lost their Mittens,
    And they began to cry,
    Oh, mother dear,
    We sadly fearOur mittens we have lost.

    Lost your Mittens
    Fear not my kittens
    and have some Obama Pie.

  22. mark2:

    The Three little Kittens,
    They lost their Mittens,
    And they began to cry,
    Oh, mother dear,
    We sadly fearOur mittens we have lost.Lost your Mittens
    Fear not my kittens
    and have some Obama Pie.

  23. Matthew Slyfield:

    Any difference between Mittens and Ozero is simply a matter of degree. There are few if any fundamental differences in principle that matter when it comes to how they will run the government. Romney might be spouting fiscal responsibility / small government rhetoric for the election, but Romney in particular and the Republicans in general have proven over and over that they don't really belive in either one of them. I will likely vote for Romney, because Obama is worse, even if it is only by degree but I am NOT going to pretend that it is a real choice or one that I am happy with.
    A pox on both their houses. If there was a viable third party my vote would be going there.

  24. mark2:

    So it is OK for the next guy to come in and overnight double the deficits of the previous guy? Dumb argument.

    Real life isn't a playground. He did it first is not a valid argument.

  25. mark2:

    I am going to vote for Gary Johnson as a protest vote, because in CA, it is hopelessly going to the dems, a vote for Mittens would be lost in the wind.

  26. Matthew Slyfield:

    In my experiance, Wikipedia has zero reliability on any topic that is the slightest bit contreversial. The extremests in any field are always more motivated and will usually win any edit war.

  27. Cardin Drake:

    The state bailouts are all well underway already. The large banks are now quasi Government sponsored entities like Fannie and Freddie. They are now loaning money to the states at unprecedented rates, while borrowing from the feds at 0%. Depressing.