Coyote Blog

I have written here before that all the free time I used to invest thinking about how to improve my business has been spent over the last 4-5 years solely on figuring out how to comply with new government regulations.  We are still trying to figure out the ins and outs of required Obamacare reporting, we have no idea yet how we are going to comply with new rules turning all of our salaried managers into timeclock punchers, and now there is this:

On the anniversary of President Barack Obama signing the Lilly Ledbetter Fair Pay Act, the Equal Employment Opportunity Commission has announced proposed changes to its EEO-1 report, requiring employers to submit employee W-2 earnings and hours worked. All employers with at least 100 employees would be required to comply. EEOC and the Office of Federal Contract Compliance Programs (OFCCP) would jointly have access to the pay data for enforcement purposes.

Available are advance copies of the proposed rule and the proposed pay reporting form.

While the Obama Administration’s January 29 statement announcing the proposal focused mainly on the gender “pay gap” as the basis for the new requirements, the proposed changes will mandate submission of pay data broken down by race/ethnicity, in addition to gender.

For the past few years, at the President’s direction, EEOC and OFCCP have sought to develop a reporting tool that would require employers to submit pay data on employees nationwide so the agencies can target investigations to address the gender “pay gap.” This proposal is the culmination of that effort.

The proposed rule will be published on February 1 and interested parties will have 60 days to submit comments.

Forget for a moment that the whole purpose of this rule is to provide litigation attorneys a database they can mine to legally harass businesses.  The reporting requirements here are incredibly onerous.  It takes the current EEO-1 (the annual exercise where we strive for a post-racial society by racially categorizing all of our employees) and makes it something like 15-20 times longer.  In addition, rather than simply "count" an employee as being on staff in a certain race-gender category, we now have to report their income and hours worked.  Either I will have to hire staff just to do this stupid report, or I will again (like with Obamacare) have to pay a third party thousands of dollars a year to satisfy yet another government reporting requirement.  This is utter madness.

Get this -- the report has 3600 individual cells that must be filled in.  And this is in addition to the current EEO-1 form, which also still has to be filled out.  The draft rule assumes 6-7 hours per company per year for this reporting.  They must be joking.

In the past, I have merely asked each local manager to tell me how many folks they have in each racial category.  Now, I am going to have to put everyone's race and gender into the payroll system -- there is no other way to do this.  And by the way, I just checked.  I have a very capable payroll company and I don't see any way to report wages and hours by race.

Congratulations Obama Administration, but I believe you have made me a Republican voter in the next Presidential election.  I have not voted for a Republican for President since George HW Bush, generally voting for whatever libertarian candidate is present.  For a while, particularly when one compared GWB to Bill Clinton, Republicans just were not that much better on economic issues than Democrats and they were terrible on social issues and things like immigration.  Now I am going to have to hold my nose on all that stuff and become a one-issue voter like my wife (she votes solely on abortion availability) and vote solely for people who have some prospect of not larding on more of this kind of crap.  And while I don't know the R's very well, for sure Hillary and Bernie will just be more of the same.

Update:   More here from the same source, who has the same observations about what a joke the administrative burden calculations are that I had.

The title of this post is my alternative to Politico's headline which reads, "Barack Obama poised to hike wages for millions." What is actually happening is that Obama is proposing to raise the threshold for how much money an employee can make before he or she can be considered exempt from overtime rules (and thus exempt from filling in a time sheet).

As early as this week, the Labor Department could propose a rule that would raise the current overtime threshold — $23,660 – to as much as $52,000, extending time and a half overtime pay to millions of American workers.

The Obama Administration and its supporters (and apparently Politico, by how they wrote the headline) are smoking something if they think employers are going to react by raising salaries of current exempt employees being paid 23,660 or 30,000 or 40,000 to $52,000.  Absolutely no way.  There may be a few just under the $52,000 threshold that get a bump, but that will be a minor effect.

Everyone else is going to suddenly find themselves converted from a junior manager back to a wage earner.   Companies are not going to allow these newly minted wage earners to earn overtime, and so I suppose one good outcome is that we may see a new boost in productivity as companies find ways to automate or eliminate junior management tasks to get all these folks down to 40 hours a week.

Five years ago, I might have really been in a panic over this in my company, but fortunately our experience with Obamacare has given me confidence we'll figure it out.  With Obamacare we were facing enormous costs which we (like many service and retail companies) managed to eliminate by converting almost all of our full-time employees to part-time.   Compared to that effort, figuring out how to get all of our managers down to 40 hours seems like child's play.

As usual, most of the costs of this regulation will be born by workers.  As with other minimum wage-type laws, some will be better off, actually getting the "raise" promised by Politico, while some will be worse off, dropped to straight 40-hour work which does not pay as well, or out of work entirely.

However, this law has an even bigger impact-- it changes the relationship between the worker and their employer.  There are important differences between hourly and salaried work in the relationship with employers.  Some are psychological -- for better or worse, management things of salaried workers differently than hourly workers.  And some are real -- salaried workers can try to demonstrate that they are worthy of promotion by working extra hours and taking on extra tasks, things that hourly workers really can't do.

As a final note, I have to give the Coyote Academic Arrogance Award to Daniel Hamermesh of UT Austin who is quoted as follows:

“It’s hard to believe that somebody making $30,000 is a supervisor,”

He knows this, how?  We have supervisors who do a fabulous job for $2500 a month and are happy to be making that.

But that is actually not the Hamermesh statement that I would rank most ignorant of reality.  This is:

But Hamermesh said that to whatever extent employers reduced hours to avoid overtime the result would be more job creation, not less, since someone else must [be] hired to perform that work. Jared Bernstein, an economic adviser to Vice President Joe Biden during President Barack Obama’s first term, added that for many workers reduced hours would be a plus: “Their salary is the same but they have more time with their families.”

Are these guys for real?  Employers are not going to give employees the same salary for fewer hours.  They are going to try pay them less if they are getting fewer hours of work (of course their ability to do so depends on the labor supply).  But the change is worse than this.  They are not only getting fewer hours, but they are getting a different person and a different relationship.  Before, say for a junior manager job, employers could get go-getters who worked 60 hours a week to impress management with their diligence and dedication, signaling they were ready for promotion.  Now, employers will get time-clock punchers.

From Atlas Shrugged:

Dr. Ferris smiled. . . . . ."We've waited a long time to get something on you. You honest men are such a problem and such a headache. But we knew you'd slip sooner or later - and this is just what we wanted."

[Hank Reardon:]  "You seem to be pleased about it."

"Don't I have good reason to be?"

"But, after all, I did break one of your laws."

"Well, what do you think they're for?"

Dr. Ferris did not notice the sudden look on Rearden's face, the look of a man hit by the first vision of that which he had sought to see. Dr. Ferris was past the stage of seeing; he was intent upon delivering the last blows to an animal caught in a trap.

"Did you really think that we want those laws to be observed?" said Dr. Ferris. "We want them broken. You'd better get it straight that it's not a bunch of boy scouts you're up against - then you'll know that this is not the age for beautiful gestures. We're after power and we mean it. You fellows were pikers, but we know the real trick, and you'd better get wise to it. There's no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren't enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws. Who wants a nation of law-abiding citizens? What's there in that for anyone? But just pass the kind of laws that can neither be observed nor enforced nor objectively interpreted - and you create a nation of law-breakers - and then you cash in on guilt. Now, that's the system, Mr. Rearden, that's the game, and once you understand it, you'll be much easier to deal with."

Here is the same thing, Obama Administration style

Major U.S. corporations have broadly supported President Barack Obama's healthcare reform despite concerns over several of its elements, largely because it included provisions encouraging the wellness programs.

The programs aim to control healthcare costs by reducing smoking, obesity, hypertension and other risk factors that can lead to expensive illnesses. A bipartisan provision in the 2010 healthcare reform law allows employers to reward workers who participate and penalize those who don't.

But recent lawsuits filed by the administration's Equal Employment Opportunity Commission (EEOC), challenging the programs at Honeywell International and two smaller companies, have thrown the future of that part of Obamacare into doubt.

The lawsuits infuriated some large employers so much that they are considering aligning themselves with Obama's opponents, according to people familiar with the executives' thinking.

"The fact that the EEOC sued is shocking to our members," said Maria Ghazal, vice-president and counsel at the Business Roundtable, a group of chief executives of more than 200 large U.S. corporations. "They don't understand why a plan in compliance with the ACA (Affordable Care Act) is the target of a lawsuit," she said. "This is a major issue to our members."

At the exact same moment, one branch of the Administration is encouraging an activity that another branch is working to criminalize.

The government claims to be making huge profits on its greentech loan program, despite losses at companies like Solyndra.

The U.S. government expects to earn $5 billion to $6 billion from the renewable-energy loan program that funded flops including Solyndra LLC, supporting President Barack Obama’s decision to back low-carbon technologies.

The Department of Energy has disbursed about half of $32.4 billion allocated to spur innovation, and the expected return will be detailed in a report due to be released as soon as tomorrow, according to an official who helped put together the data.

The results contradict the widely held view that the U.S. has wasted taxpayer money funding failures including Solyndra, which closed its doors in 2011 after receiving $528 million in government backing. That adds to Obama’s credibility as he seeks to make climate change a bigger priority after announcing a historic emissions deal with China.

Even Kevin Drum calls partial BS on this:

And yet....I'd still remain a bit cautious about the overall success of the program. Out of its $32 billion in approved loans, half represent loan guarantees to nuclear power plant developers and Ford Motor. These are not exactly risky, innovative startups. They're huge companies that could very easily have raised money without government help, and which represented virtually zero danger of default. If DOE is including returns from those loans in its forecast, color me unimpressed.

The genuinely risky half of the loan program is called Section 1705, and it includes everything that most of us think of as real renewable energy projects (wind, solar, biofuel, etc.). DOE hasn't broken that out separately.

I call further BS.  It turns out this program is actually losing money, not making money.

1. This "study" is a classic case of assuming your conclusion. The reason the risky parts of the portfolio would lose money is if they don't pay off over the next 20 years or so they have to run. But all the study says is "The $5 billion to $6 billion figure was calculated based on the average rates and expected returns of funds dispersed so far, paid back over 20 to 25 years." In other words, if the loans turn out not to be risky, they won't be risky. LOL.
2. I bet they are not accounting for things like Ivanpah, there the holders of the government loan are looking to pay off the government loan with .. a government subsidy. So if you squint, the loan to Ivanpah looks profitable, but no rational person would come to that conclusion about the program as a whole.
3. Ivanpah is just a subset of a larger problem. Companies like Tesla get government subsidies (and their customers get subsidies as well) from dozens of sources. Is it really a win for taxpayers if they pay back their government loan with government money?
4. They count the 37 basis points above treasury rates that they charge as "profit". This is crazy. I run a fairly large business. No business is getting Tbills +37 BP loans. Heck, since Tbills are at about 0%, this means they are loaning money to private concerns at less than 1%. This is a crazy large subsidy.  I could make money in over a 2-5 year period in just about anything if I could borrow at effectively 0%.
5. Worst of all, they are not using present value.  Let's say their average spread from the Bloomberg article is 100 BP over treasuries.  That means that ignoring loan losses on a $32 billion portfolio they are making a spread of $320 million a year.  Over 20-25 years that is $6-7 billion.  Less some large loan losses that is $5-6 billion.  But notice I never discounted.  This is just adding up nominal interest spreads over 25 years.  This is insane.  Absolutely no private investor on the planet would think like this.  If you discounted the interest spread payments at any reasonable risk-adjusted rate**, then the net present value may already be less than losses in Solyndra and others and thus already in the hole, even without considering future losses.  This report is an embarrassing political exercise, not a serious economic analysis.

All of this leaves out the inherent cronyism of the whole exercise.

** I would argue that in many of these loans, and despite interest rates charged in the 0-2% range, the government was taking an equity risk.  Worse than equity risks -- these are essentially venture capital investments risks with T-bill returns (note the one private comment on the returns in the Bloomberg article is from a venture capital investor in greentech).   The taxpayers are bearing all the risk but getting none of the returns.  Any discount rate for these risks under 15-20% is far too low.

This correction by Michel Taylor of something called the Australian Independent Media Network has got to be the longest correction in history.  You know it is an incredible correction when this is just a tiny part of the errors admitted:

• Evans does not believe, and has never believed, that 9/11 was an inside job perpetrated by the Rothschild family, that US President Barack Obama is a secret Jew, that the Holocaust never happened or that Jewish bankers and the Rothschild family have assassinated at least two US Presidents.

The author also admits to getting Evans' education, occupation, organization, and sources of funding wrong.

In part I suppose kudos are owed to Mr. Taylor for being so honest, but seriously, how can one be so comprehensively wrong? (I will actually explain why in a minute).  The correction runs on so long in part because he Taylor also has to correct an earlier correction where he blamed one of his original sources for being intentionally misleading.  He also apologizes for that.

I would likely have posted this anyway just because it is sort of funny.  But it just so happens to tie into what I wrote yesterday here.  Because it is clear that Mr. Taylor's core mistake is that he researched the positions of a climate skeptic (Mr. Evans) solely by asking climate alarmists (and climate alarmist web sites) what this skeptic believed.  He felt no need to hear the skeptic case from the skeptic himself.  And what do you know, the descriptions of Mr. Evans' beliefs as portrayed by his ideological enemies were full of errors, exaggerations, straw men, and outright lies.  Who would have thought?

We can laugh at Mr. Taylor, but at least he admitted his mistakes in great depth.  But outlets such as the LA Times and the BBC have recently made it a rule they will never allow skeptic voices into their reporting.  They have institutionalized Mr. Taylor's mistake.

Via the WSJ:

President Barack Obama said Thursday that insurers will be able to continue health-insurance coverage next year for current policy holders that otherwise would be canceled under the new health-care law....

"Insurers can offer consumers the option to renew their 2013 health plans in 2014 without change, allowing these individuals to keep their plans," a senior White House official said, previewing Mr. Obama's announcement. These consumers will be given the opportunity to re-enroll, the official said, essentially extending the so-called grandfather clause in the 2010 health overhaul that allowed people to keep their plans if they were in place before the law passed.

"This step today is in the interest of fixing some of the challenges that have arisen" since then, the official said.

Under the plan, insurers are required to notify consumers whether their renewed plans don't include coverage that was required under the new health law, which set minimum coverage standards. They must tell consumers that new insurance options and possibly tax subsidies may be available for policies bought through online federal marketplace.

1.  The President announced this today to try to head off Congressional legislation to do the same thing.  Have we just given up on the rule of law?  Can the President unilaterally modify any law he pleases?  Shouldn't a modification in existing legislation have to come from the Legislature?  Can we just make it official and change the Constitution to say that the President can alter any legislation he wants as long as his party originally passed it?

2.  How is this even going to be possible?   My understanding is that insurance companies spend months preparing the pricing and features of their products for the next year.  The have done no preparation to offer these plans in 2014, because, you know, they were (and still are, whatever the President says in a news conference) illegal.   Its like your wife telling you to take the next exit when you are in the left lane driving 75 miles an hour in heavy traffic and the exit is about 100 yards away.  With 31 business days between now and the new year, how are they supposed to do this?  Or are they even expected to be able to do so?  Is this the President's way to blame shift to insurance companies?

Update:

Insurance source: WH fix places "onus on us even tho they know we can't" effectively extend cancelled policies given rates/logistics probs

— John Harwood (@JohnJHarwood) November 14, 2013

More from insurance industry source on WH O-care fix: "This is a joke - doesn't change anything but allow WH to blame insurance companies"

— John Harwood (@JohnJHarwood) November 14, 2013

From Reuters via Zero Hedge:

The Obama administration on Thursday acknowledged that it is collecting a massive amount of telephone records from at least one carrier, reopening the debate over privacy even as it defended the practice as necessary to protect Americans against attack.

The admission comes after the Guardian newspaper published a secret court order related to the records of millions of Verizon Communications customers on its website on Wednesday.

A senior administration official said the court order pertains only to data such as a telephone number or the length of a call, and not the subscribers' identities or the content of the telephone calls.

Such information is "a critical tool in protecting the nation from terrorist threats to the United States," the official said, speaking on the condition of not being named.

"It allows counter terrorism personnel to discover whether known or suspected terrorists have been in contact with other persons who may be engaged in terrorist activities, particularly people located inside the United States," the official added.

The revelation raises fresh concerns about President Barack Obama's handling of privacy and free speech issues. His administration is already under fire for searching Associated Press journalists' calling records and the emails of a Fox television reporter as part of its inquiries into leaked government information.

A few thoughts:

1. I have no doubt that this makes the job of tracking terrorists easier.  So would the ability to break down any door anywhere and do random house searches without a warrant.  The issue is not effectiveness, but the cost in terms of lost liberty and the potential for abuse.  The IRS scandal should remind us how easy it is to use government power to harass political enemies and out-groups
2. The FISA court is a bad joke, as it seems willing to issue "all information on all people" warrants.  I think there is little doubt that similar data gathering is going on at all the other carriers.
3. Luckily, Susan Rice is now the National Security Adviser.  I am sure with her proven history of not just being a political puppet but really digging in to challenge White House talking points that she will quickly get to the bottom of this.

The confrontation may be coming soon in the environmental community over wind power -- it certainly would have occurred already had the President promoting wind been Republican rather than Democrat.  I might have categorized this as "all energy production has environmental tradeoffs", but wind power is so stupid a source to be promoting that this is less of a tradeoff and more of another nail in the coffin.  As a minimum, the equal protection issues vis a vis how the law is enforced for wind companies vs. oil companies are pretty staggering.

“It happens about once a month here, on the barren foothills of one of America’s green-energy boomtowns: A soaring golden eagle slams into a wind farm’s spinning turbine and falls, mangled and lifeless, to the ground.

Killing these iconic birds is not just an irreplaceable loss for a vulnerable species. It’s also a federal crime, a charge that the Obama administration has used to prosecute oil companies when birds drown in their waste pits, and power companies when birds are electrocuted by their power lines.”

“[The Obama] administration has never fined or prosecuted a wind-energy company, even those that flout the law repeatedly. Instead, the government is shielding the industry from liability and helping keep the scope of the deaths secret.”

“Wind power, a pollution-free energy intended to ease global warming, is a cornerstone of President Barack Obama’s energy plan. His administration has championed a $1 billion-a-year tax break to the industry that has nearly doubled the amount of wind power in his first term. But like the oil industry under President George W. Bush, lobbyists and executives have used their favored status to help steer U.S. energy policy.”

“The result [of Obama energy policy] is a green industry that’s allowed to do not-so-green things. It kills protected species with impunity and conceals the environmental consequences of sprawling wind farms.”

“More than 573,000 birds are killed by the country’s wind farms each year, including 83,000 hunting birds such as hawks, falcons and eagles, according to an estimate published in March in the peer-reviewed Wildlife Society Bulletin.

Via the WSJ, President Obama is proposing debt forgiveness for student borrowers

The White House proposes that the government forgive billions of dollars in student debt over the next decade, a plan that cheers student advocates, but critics say it would expand a program that already encourages students to borrow too much and stick taxpayers with the bill.

The proposal, included in President Barack Obama's budget for next year, would increase the number of borrowers eligible for a program known casually as income-based repayment, which aims to help low-income workers stay current on federal student debt.

Borrowers in the program make monthly payments equivalent to 10% of their income after taxes and basic living expenses, regardless of how much they owe. After 20 years of on-time payments—10 years for those who work in public or nonprofit jobs—the balance is forgiven.

Already, it's pretty clear that many students pay little attention to size of the debt they run up.  Easy loans for students have essentially made them less price sensitive, however irrational this may seem (did you make good short - long term trade-offs at the age of 18?)  As a result, tuition has soared, much like home prices did as a result of easy mortgage credit a decade ago.  The irony is that easier student debt is not increasing access to college for the average kid (since tuition is essentially staying abreast of increases in debt availability), but is shifting student's future dollars to university endowments and bloated administrations.  Take any industry that has in the past been accused of preying on the financially unsophisticated by driving them into debt for profit, and universities are fifty times worse.

So of course, the Progressives in the White House and Congress (unsurprisingly Elizabeth Warren has a debt subsidy plan as well) are set to further enable this predatory behavior by universities.  By effectively capping most students' future financial obligations from student debt, this plan would remove the last vestiges of price sensitivity from the college tuition market.  Colleges can now raise tuition to infinity, knowing that the bulk of it will get paid by the taxpayer some time in the future.  Just as the college price bubble looks ready to burst, this is the one thing that could re-inflate it.

Postscript:  By the way, let's look at the numbers.  Let's suppose Mary went to a top college and ran up $225,000 in debt.  She went to work for the government, averaging $50,000 a year (much of her compensation in government is in various benefits that don't count in this calculation).  She has to live in DC, so that's expensive, and pay taxes.  Let's say that she has numbers to prove she only has $20,000 left after essential living expenses.  10% of that for 10 years is $20,000 (or about $13,500 present value at 8%).  So Mary pays less than $20,000 for her education, and the taxpayer pays $205,000.  The university makes a handsome profit - in fact they might have given her financial aid or a lower tuition, but why bother?  Mary doesn't care what her tuition is any more, because she is capped at around $20,000.  The taxpayer is paying the rest and is not involved in the least in choosing the university or setting prices, so why not charge the taxpayer as much as they can?

Postscript #2:  It is hard to figure out exactly what Elizabeth Warren is proposing, as most of her proposal is worded so as to take a potshot at banks rather than actually lay out a student loan plan.  But it appears that she wants to reduce student loan interest rates for one year.  If so, how is this different from teaser rates on credit cards, where folks -- like Elizabeth Warren -- accuse credit card companies of tricking borrowers into debt with low initial, temporary rates.  I  find it  a simply astounding sign of the bizarre times we live in that a leading anti-bank progressive is working on legislative strategies to get 18-year-olds further into debt.

Once upon a time, government officials decided it would help them keep their jobs if they could claim they had expanded the middle class.  Unfortunately, none of them really understood economics or even the historical factors that led to the emergence of the middle class in the first place.  But they did know two things:  Middle class people tended to own their own homes, and they sent their kids to college.

So in true cargo cult fashion, they decided to increase the middle class by promoting these markers of being middle class.  They threw the Federal government strongly behind promoting home ownership and college education.  A large part of this effort entailed offering easy debt financing for housing and education.  Because the whole point was to add poorer people to the middle class, their was a strong push to strip away traditional underwriting criteria for these loans (e.g. down payments, credit history, actual income to pay debt, etc.)

We know what happened in the housing market.  The government promoted home ownership with easy loans, and made these loans a favorite investment by giving them a preferential treatment in the capital requirements for banks.  And then the bubble burst, with the government taking the blame for the bubble.  Just kidding, the government blamed private lenders for their lax underwriting standards, conviniently forgetting that every President since Reagan had encouraged such laxity (they called it something else, like "giving access to the poor", but it means the same thing).

A similar bubble is just about to burst in the college loan market, and this time it will be much harder for the government to blame private lenders, since the government effectively nationalized the market several years ago and for years has been the source of at least 90% of all college loans.  In the Wall Street Journal today, it was reported that student loans are now the largest component of consumer debt, and growing

Further, a Fed report yesterday said that student loan diliquencies have jumped substantially of late

The scary part was found by Zero Hedge in the footnotes of the report, which admit that this number is understated by as much as half, meaning the true delinquency rate of student debt may be north of 20%.

The Journal article linked above explains why this is:

Nearly all student loans—93% of them last year—are made directly by the government, which asks little or nothing about borrowers' ability to repay, or about what sort of education they intend to pursue.

President Barack Obama championed easy-to-get loans during the campaign, calling higher education "an economic imperative in the 21st century." A spokesman for Education Secretary Arne Duncan said the goal is "to make student loans available to as many people as possible," and requiring minimum credit scores would block many Americans

Any of this sound familiar?  I seldom learn much from anecdotes in new stories since it is too easy to craft a stirring anecdote on either side of just about any issue.  But I was amazed at the story of the woman who was issued $184,500 in student debt to send her son to college when her entire income is a $1600 a month disability check.

It's hard to see populist, wacky GOP candidates making much progress nationally if they can't get any traction in Arizona.

A poll of 623 Arizona voters released today reflects a couple things -- almost nobody likes Donald Trump, and most people would prefer Sarah Palin not move here.In the poll -- from Public Policy Polling -- opinions are recorded about possible GOP nominees for the 2012 presidential election, and how they'd vote if they ran against President Barack Obama.

Donald Trump was the most unfavorable of five possible GOP candidates -- with a full 2/3 of people dissin' the Donald with an "unfavorable" ranking.

Remember that whole thing about former Alaska Governor Sarah Palin moving to Arizona for a possible Senate campaign?

Most people would prefer that not happen.

Palin was the second-most-disliked candidate -- with 62 percent having unfavorable opinions -- and a later question revealed 57 percent of people would prefer that she not move to Arizona.

Trump also suffered the biggest blowout in a hypothetical match-up against Obama, garnering votes from only 36 percent of respondents.

Via the WSJ, discussing the US's Siberian Gulag in the Caribbean:

The Obama administration on Monday announced plans for new Guantanamo Bay military trials and for the first time laid out its legal strategy to indefinitely detain prisoners who can't be tried but are too dangerous to be freed.

President Barack Obama issued an executive order to conduct periodic reviews of the cases of the nearly 50 detainees who will be detained indefinitely.

It used to be that people who had never been convicted of any crime but that certain people in the government considered dangerous were called "free men."

The recent naming of GE's Jeffrey Immelt to head a presidential commission on, err, something or other seems to have been an occasion for bipartisan gnashing of teeth about what I call the growth of the American corporate state.  I was encouraged by the bipartisan negative reaction from the left, right, and of course the libertarians, the latter of whom have always understood the difference between being pro-capitalism and pro-business.

But all it takes is a nomenclature change of this corporate welfare to "green jobs" or "investment in the future" or "bridge to the future" or similar bullsh*t and suddenly many of the exact same people, at least on the left, are swooning again.  Why is it not obvious that, for example, green energy subsidies are just the same old corporate welfare?

Here is one aggravating example

Despite millions in government grants and subsidies, the Manitowoc company President Barack Obama called a glimpse of the future lost $4.2 million last year and cannot promise shareholders it will be profitable in the foreseeable future....

“We may continue to incur further net losses and there can be no assurance that we will be able to increase our revenue, expand our customer base or be profitable,” the report indicates.

Investors have responded to the company’s volatility, and Orion stock has plummeted in the past four years.  It closed 2007 at $18.82 a share.  By the end of 2010 it was $3.34.

Regardless, President Obama is putting his, and the U.S. taxpayers’, money on companies like Orion.

“It’s important to remember that this plant, this company has also been supported over the years not just by the Department of Agriculture and the Small Business Administration, but by tax credits and awards we created to give a leg up to renewable energy companies,” Obama said at the Orion plant on Wednesday.

The State of Wisconsin has also given its share trying to help Orion to succeed.  Since 2005, the state has given the company $350,000 in community development zone tax credits, $506,000 in economic development funds, and $420,000 from the Wisconsin Energy Independence Fund.  Plus the company got another $260,000 in stimulus funds for a State Energy project.

In addition to direct aid, public policy has also helped the struggling company.  Wisconsin law requires that 10 percent of all electricity sold in the state come from renewable sources by 2015.  Orion knows that without government intervention like that, there would be little prospect for the green economy.

“The reduction, elimination or expiration of government mandates and subsidies or economic or tax rebates, credits and/or incentives for alternative renewable energy systems would likely substantially reduce the demand for, and economic feasibility of, any solar photovoltaic and/or wind electricity generating products, applications or services and could materially reduce any prospects for our successfully introducing any new products, applications or services using such technologies,” the SEC report states.

By the way, in 2010, while the government was pouring taxpayer money into Orion, its founder and CEO was pulling his out, selling (by my count of SEC filings) 130,000 shares, despite equity prices that were at a five year low.    It is dangerous to draw conclusions form insider sales (we don't know what personal financial issues may be driving their actions) but it is interesting that the president and founder is taking the exact opposite point of view on the company's prospects than is President Obama.

My first column at Forbes.com is up here (and on the opinion home page, which is kind of cool), and extends on some thoughts I have already posted on my blog about why government decisions in multi-agency task forces, such as those running the Gulf cleanup effort, seem to be made in such a stupid manner.

As most scientists know, one of the best tests of a theory is whether it makes correct predictions about future events.  Since I wrote this article several days ago, we have seen this new story which is absolutely consistent with the decision-making paradigm I describe in the article (from Q&O)

Louisiana has been busily building berms about a mile out from the coast to halt the infiltration of oil into its sensitive marshes, wetlands and prime fishing areas. This process was greatly delayed by federal red tape, and now that the state has permits in hand it's being order to stop because, according to the U.S. Fish and Wildlife Department, it's doing it wrong:

The federal government is shutting down the dredging that was being done to create protective sand berms in the Gulf of Mexico.

The berms are meant to protect the Louisiana coastline from oil. But the U.S. Fish and Wildlife Department has concerns about the dredging is being done.

Plaquemines Parish President Billy Nungesser, who was one of the most vocal advocates of the dredging plan, has sent a letter to President Barack Obama, pleading for the work to continue.

[...]

Nungesser has asked for the dredging to continue for the next seven days, the amount of time it would take to move the dredging operations two miles and out resume work.

Work is scheduled to halt at midnight Wednesday.

Pat Austin is trying to understand the federal obstruction, but finds that political reasoning is the only thing that makes sense of it all:

I'm trying to see both sides here; I'm trying to understand the "coastal scientists" who contend that the berms will "change tidal patterns" and lead to more long term erosion of the islands, but if the islands are killed off by the oil what difference does it make? To borrow from Greta Perry's analogy, if my house is on fire, what does it matter what room I try to extinguish first? It's all doing down.

Read the Forbes article -- why exactly this decision was not only possible but inevitable is discussed in detail.

Remember all that BS about the Obama administration only being ruled by facts and science?  This is a mythology at the core of the progressive movement, that it is possible to have a wise dictator who uses the heavy hand of government coercion only for the best interests of the country, driven only by science and not by political influence.

This is of course a crock.  It was a popular point of view in the early 20th century, and at the heart of efforts like Mussolini's fascism, which in turn was much admired by FDR and emulated in US efforts like the NRA (the blue eagle, not the gun organization).  Over time, history has demonstrated folks like Hayek right on the knowlege problem (no one can possibly be smart enough to make optimum decisions for everyone, particularly when everyone has different preferences) while we have plenty of evidence to demonstrate the incentives for politicians are skewed so badly as to make good decisions almost impossible.

But the myth persists, even in the face of obvious counter-examples, like this (emphasis added):

The economic report released last week by Health and Human Services, which indicated that President Barack Obama's health care "reform" law would actually increase the cost of health care and impose higher costs on consumers, had been submitted to the office of HHS Secretary Kathleen Sebelius more than a week before the Congressional votes on the bill, according to career HHS sources, who added that Sebelius's staff refused to review the document before the vote was taken."The reason we were given was that they did not want to influence the vote," says an HHS source. "Which is actually the point of having a review like this, you would think."

The analysis, performed by Medicare's Office of the Actuary, which in the past has been identified as a "nonpolitical" office, set off alarm bells when submitted. "We know a copy was sent to the White House via their legislative affairs staff," says the HHS staffer, "and there were a number of meetings here almost right after the analysis was submitted to the secretary's office. Everyone went into lockdown, and people here were too scared to go public with the report."

In the end, the report was released several weeks after the vote -- the review by the secretary's office reportedly took less than three days -- and bore a note that the analysis was not the official position of the Obama administration.

Wouldn't want to influence a vote with actual facts.

For a while now I have been saying that Obama is not promoting Socialism, but rather an European-style corporate state -- where a troika of large unions, powerful politicians, and favored corporations worked together mainly to get themselves in power and to protect each other from competition.

It seems that Ron Paul sees it the same way:

Republicans and tea party activists are fond of accusing President Barack Obama of being a socialist, but today party gadfly Ron Paul said they had it wrong."In the technical sense, in the economic definition, he is not a socialist," the Texas Republican said to a smattering of applause at the Southern Republican Leadership Conference.

"He's a corporatist," Paul quickly added, meaning the president takes "care of corporations and corporations take over and run the country."

Certainly one driver of statism is arrogance -- the technocratic belief that one's intellectual capacity and decision-making ability is superior to that of the masses, and therefore should be substituted (via authoritarian control) for that of the masses.  This was clearly the driver of statism in the early to mid-century.  Its what caused FDR to be so enamored of Mussolini-stype fascism.  A few smart people making the trains run on time.

But I am starting to wonder if there isn't a second driver of statism that comes from the opposite direction -- projecting one's own weaknesses on the rest of humanity and, assuming they share these weaknesses, using this assumption as a reason for mommy-state controls.  This latter reasoning came through in this article summary in my feed reader from the Arizona Republic:

Lamenting his first teenage cigarette, President Barack Obama ruefully admitted on Monday that he's spent his adult life fighting the habit. Then he signed the nation's toughest anti-smoking law, aiming to keep thousands of other teens from getting hooked.

With gays upset that Obama has aligned himself squarely behind DOMA and Don't-ask-don't-tell in the military, he has decided to pay them off rather than address their equal treatment questions:

President Barack Obama, whose gay and lesbian supporters have grown frustrated with his slow movement on their priorities, is extending benefits to same-sex partners of federal employees but stopping short of a guarantee of full health insurance, a White House official said.

The health insurance exception is particularly funny given Obama's current universal-coverage-driven health care proposals.