Archive for the ‘Economy’ Category

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The further adventures of the Illinois legislature

May 31, 2012

I’m no union activist. I belonged to IEA/NEA because I was required to. (OK, there was that “fair share” clause, which meant I would pay essentially the same as the union dues while receiving none of the benefits. Clever.) I also just as a rule hate the idea of lobbyists. I know that some of them provide a useful function. Both at the state and federal levels, lawmakers and their staffs do not have the time, resources or expertise to know everything about every issue before them. However, lobbyists come with baggage – they are obviously attempting to influence the content of law as it is written.

I may be softening my opinion on lobbyists somewhat. “Of course, now it affects you! Hypocrite!” you say. And, to an extent, you’re right. I’m finding out as this “pension reform” bill gets bounced around the Illinois state legislature that not only are those whom we elected to represent us unable to know everything concerning decisions they are making, but that they are making those decisions based on how they will look for upcoming elections, not on what is good for the citizenry.

I know, big surprise, right?

You see, I’ve met or at least followed closely both state and federal representatives in both Ohio and Illinois. By and large, I think I’ve been well represented by my local reps. For example, I think Judy Biggert (in the US House) and Patti Bellock and Kirk Dillard (in the Illinois legislature) have done pretty well, overall. (Don’t start with me about the Illinois Senators, though.)

Unfortunately, that’s not true for everyone. In fact, I’d lean toward saying that there are many of our duly elected representatives who do not have our best interests at heart. I know, another revelation!

At the risk of going on too much about this, here’s a case in point: The Illinois “pension reform” bill included a clause that would shift the cost of the teachers’ retirement system to the local school districts, therefore shifting the costs to the local taxpayers. Note that we wouldn’t see a decrease in our state taxes – so this is an additional tax, and depending upon how much a district pays its teachers, the increase in property taxes could be large. In the “collar” counties we have a”tax cap” – property taxes can only be raised by so much by law. If the cost of the new retirement payments causes the budget of the district to exceed the capped amount, something else gets cut. And the property tax payers hate teachers even more.

Removing this clause was a sticking point, with the Democrats wanting it included, and the Republicans wanting it out. If it’s in, it will be unpopular with the voters. If it’s gone, where is the money to fund the system coming from?

The Governor decided he could live with the removal of that clause. He passed it on to the Speaker of the Illinois House, Michael Madigan, who then dropped the bill on the Minority Leader, Tom Cross (a Republican) to shepherd the bill through. This is called plausible deniability. “It’s not our fault!”

I’m waiting to hear if the bill comes out of committee this morning. I don’t know what else we can do to influence the outcome here. It sounds like “looking good” to the voters is far more important than actually getting a real solution. I’m afraid that the lobbyists are our only hope. I never wanted that to happen, but it’s all we’ve got!

I sent this message to Tom Cross, who is not my representative but is the Minority Leader:

Dear Rep. Cross:

I actually live in Rep. Bellock’s district, and I have emailed her and my Senator, Kirk Dillard. I am a recently-retired teacher from Hinsdale Township High School District 86. I am writing to you to add my voice to those who are urging you to abandon this pension “reform” bill and start over in a reasonable manner, instead of trying to push something through on the last day of the legislative session.

I am not a “union activist” – in fact, if I was not required to be a member of IEA/NEA I probably would not have done so. I generally dislike the influence of lobbyists both in Springfield and in Washington. However, I do not know of any other way to let our representatives know that this entire pension reform process seems to be flawed.

Obviously, no state legislator will admit that the reason for the pension problem today is that the state has not funded the pension systems as required by the Illinois Constitution. Now the day of reckoning seems to be at hand, and the Governor is trying to find a way to cover the shortfalls without doing what was legal and required in the first place. It’s difficult for me, and for others, to “feel the pain” of the state government when spending money they did not have caused the problem. If I overspend my income, I cannot go to the taxpayers for more money, no matter how good the reasons for my expenditures. Many taxpayers today find it hard to understand why the state and federal governments refuse to live within their means.

Back to the issue at hand: any solution to this “crisis” needs to follow the Pension Clause in the Illinois Constitution. It also needs to be done in a manner that demonstrates that our representatives are thoughtful stewards of our tax dollars, not merely politicians most interested in their re-election and handing out largesse to their constituents to buy votes.

Please take the “high road” on this issue – please do not push this reform bill, in whatever form it takes at the moment, through the legislature today. The Governor is most interested in looking good, not in finding a reasonable solution. I appeal to you as a reasonable man and a true representative not only of your district but of Illinois citizens in general, since you are the person who has the ability to determine the outcome of this process.

So we’ll see what happens. I hate this feeling of powerlessness!

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SB 1673

May 29, 2012

The Illinois legislature is well-known for pushing through controversial legislation at the 11th hour just before the conclusion of a legislative session. SB 1673 is supposed to reform the state pension system, which everyone should be in favor of, right?

Except it doesn’t. It’s unconstitutional, it lets the State off the hook for the lack of funding to the system that was mandated by the Illinois Constitution, and it puts more strain on property owners. Information about it can be found here.

I don’t buy the argument that the system has to be fixed now as some sort of emergency. The legislature has been screwing with the pension system for decades. If private union pension systems were handled by the union leaders in this way, they would be in prison. As legislators, it’s “sound fiscal management.”

Maybe the current system is not working. It would have if the state would have been making its payments for the the last 30 years. But it was easier to use the money for other things and give IOUs to the pension systems. Now that mismanagement has come home to roost, and the way out of it is to reduce benefits and shift the burden to others.

Except it’s not legal. One law doesn’t negate a part of the Illinois Constitution, no matter what they say. It’s sort of our own Illinois Obamacare  – the legislation has to be passed now or disaster will befall us, but we can’t tell you what that legislation is, and it’s probably not constitutional anyway.

Unfortunately, this is business as usual in Springfield. I’m afraid they will get it through no matter how much we object.

If you believe pension reform should be done in a reasonable, fair, and constitutional manner, you may want to let your senator and representative know that – and soon. The thing might pop up to a vote tomorrow.

Here’s what I sent to my state representative:

Dear Ms. Bellock:

I wrote to you a little over a week ago about the pension debate in the Illinois legislature. If you recall, I am a recently-retired teacher from Hinsdale District 86. 
 
Now my worst fears are coming true – there is a bill that just came out of committee that is designed to “reform” the pension system. As I feared, it has only appeared two days before the end of the legislative session – a move clearly designed to make it impossible to marshall opposition to the bill in time and to make it difficult for representatives to get feedback from their constituents.
 
Of course, it does not reform the system. It provides political cover to those legislators who need to go back to their constituencies and say they held the line to try to save the State of Illinois from its “pension crisis,” and, if passed, it will probably help to do that for a very short while. However, it promises what it will likely not deliver, such as restitution to the retirement system of back payments by the State required by law.
 
On the other hand, it should be quickly challenged for its constitutionality, since the pension system was established in the Illinois State Constitution and this bill clearly negates parts of the Pension Clause. It also will cause no end of problems for school districts across Illinois – many of which cannot raise their property tax rates because of the tax cap. It widens the rift between the taxpayers and public employees that has been created by demagogues for their own purposes.
 
This bill is NOT the kind of reform we need. We need reform that can last, that is constitutional, and that requires the State live up to its obligations. The fact that the State now does not have the money to pay for pensions is a result of poor fiscal management and political pandering, not of the retirement system or its managers.
 
I am offended that some legislators believe this is the way to make law and handle the affairs of the citizens. Pushing this bill through may look good for a few politicians in the short term, but as the ramifications of it are felt down the line, those who are responsible will be remembered.
 
I consider you a “cooler head” and someone who has not fallen prey to the politician-as-celebrity style of representation. I hope you, and like-minded Representatives across Illinois, will do all you can to stop this bill. It is another example of a bandaid solution made so that some people – including the Governor – look good in the short term while only creating more problems down the line. Please do all you can to keep this bill from being driven through and becoming law.
 
Sincerely,
I urge you to send something similar, or call their offices.
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Life Imitates Art

May 23, 2012

I just wrote a piece about how the themes in Ayn Rand’s Atlas Shrugged are being used by liberals, and particularly by the Obama campaign. It can be found at Keep Americans Free! I invite you to read it, and to read Atlas Shrugged.

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If you’re the Federal government, and you’re doing one thing right, kill it!

May 13, 2012

I can only see one reason for the House Appropriations Committee’s push for NASA to “downselect” the number of companies building private spacecraft: pork barrel politics.

I’ve not looked into the congresscritters who are pushing the restriction of NASA funding to one or two companies yet. I know that two of them are Florida Republicans, Bill Posey and Sandy Adams. I simply cannot fathom any other reason for Republicans in the House to make such an incredibly boneheaded decision!

Unfortunately, making boneheaded, short-sighted decisions is not just in the purview of Democrat congresscritters. Republicans seem to be just as willing and able to do so. House members are supposed to be more responsive to their electorates than Senators, decreed so by virtue of the structure laid out in the Constitution. I expect that Representatives would do what they can to make sure tax dollars going into the Federal government coffers come back to their constituents.

NOTE: OK, kids, go into the other room and watch TV or read a book. Preferably Robert A. Heinlein or L. Neil Smith, if possible. Anyway, the adults and I have to talk and I may get emotional and use colorful language.

But: after decades of harping that the space program would be in better hands if not a governmental agency, just when competitive approaches to access to orbit are beginning to bloom – they want to kill them, and return to the bad old days when NASA was the only game in town.

THIS IS COMPLETE AND UTTER STUPIDITY. IT MAKES NO SENSE ON ANY LEVEL EXCEPT A LEVEL OF SELFISHNESS THAT SHOULD NOT BE DEMONSTRATED BY ANY OF OUR ELECTED REPRESENTATIVES TO CONGRESS.

Mark my words, brothers and sisters: this has absolutely nothing to do with safety, “protection of government intellectual property” – whatever the Hell that means, and don’t get me started – good stewardship of our tax dollars, or any other high-handed phrases they can trot out.

It comes down to CONTROL. CONTROL OF YOUR TAX MONEY. That, folks, is really all the Federal government is about. Take the taxing power away  – or even restrict it – and the whole thing would wither and die in a fortnight. The fact remains that the FEDERAL GOVERNMENT, THROUGH THE CONGRESS, CAN TAX US TO ANY EXTENT IT WISHES, AND WE ARE POWERLESS TO STOP IT. 

Do NOT give me crap about “we can fix it in the next election.” Look what this idiot has done to us in three and a half years. He flagrantly violates the Constitution and Federal law, and no one – even the Republicans in Congress – does anything about it. He browbeats the Supreme Court, threatens the Congress, and places blame for his own misguided ideas on everyone else, and we’re all supposed to be happy because he’s decided he’s for gay marriage. (Let’s not talk about how that announcement came right before a huge Hollywood fundraiser, because of course there is no connection.) And the alternative: I am not convinced Romney will be much better, sorry.

“But Stimps,” you say, “if you really believe in those crazy libertarian-leaning views of yours, why should you care? Shouldn’t those private companies be able to compete anyway with whatever company NASA might select?”

OK. Small words, short sentences. It’s not that complicated as to why that won’t work.

1. Government regulation. You can’t launch a rocket from US soil without jumping through about a million hoops first. Rockets are huge tanks of highly explosive chemicals, sheathed in metal; it’s supposed to be bad to launch one from, say, Indiana. The folks in Ohio where said failed rocket falls would be upset. So some regulation might be necessary, but – SpaceX wasn’t allowed to do their first Falcon launches from anywhere within the US, not even Florida. They had to go out to Kwajalein Atoll in the Pacific. When the launch was scrubbed, they had to wait for another tanker of liquid oxygen to come from the US because they had lost too much of their supply to boiloff already. There are no sources of LOX on the Atoll, imagine that. The government put them so far away from the world that most people would have given up. Elon Musk, thank the Good Lord, is NOT most people. Still, the Federal regulations they had to go through to launch from Pad 40 at the Cape are incredible.

“But,” you say, “United Launch Alliance has to go through the same thing before they launch an Atlas or a Delta, right?”

OK…

2. There is no real competition if some companies get major favoritism from the government. United Launch Alliance is, actually, Lockheed-Martin and Boeing, dba as ULA. In 2005 SpaceX challenged them through antitrust laws as a monopoly. In 2006 the Pentagon and the Federal Trade Commission both gave ULA their blessing, of course. Case closed.

There was a big political reason for this, of course. It looked on the surface like privatization of launch services but the same people who had been doing the work for NASA now just got their paychecks from ULA instead of either the Feds or LockMart or Boeing. It is, in essence a shell company. Business as usual. And a bunch of folks working on the Florida Space Coast kept their jobs. Since this was during the wind-down of shuttle operations it was largely considered a Happy Thing. Unfortunately, SpaceX was right. ULA is the de facto only provider of orbital launch services to the US Government except for S.P. Korolev Rocket and Space Corporation Energia, which builds and launches the Soyuz and Progress vehicles to the ISS. We’re not pushing EADS to build a man-rated Ariane 5, are we? (Oh, well, yeah, the Liberty launcher, with ATK, but I don’t know if that counts, seeing as how they are kind of on the outs with NASA right now. This is one of those endeavors I’m sure the Congressional Committee would like to be killed first. Well, maybe second, after SpaceX.)

Besides, there are really only four markets for space launches right now: commercial satellites, government (military) satellites, manned and unmanned missions to support the International Space Station, and soon, hopefully, manned and unmanned support of the Bigelow Aerospace orbital habitats.

More commercial satellite launches worldwide now go to Arianespace than to ULA – we’ve already lost that market, big time. Energia is going launch a Soyuz from the Arianespace launch site in French Guiana soon.  (Kazakstan is getting to be increasingly difficult to work in if you are a Russian, I understand.) The US government should be encouraging US companies to compete with the French and the Russians, not throw roadblocks in their way.

We can – and should – enable a competitive market for the ISS supply missions. That’s what most of the commercial companies are working toward right now, of course. They all believe – or they wouldn’t be in this game – that eventually there will be a much larger market for manned space flights. I don’t think any of them are stupid enough to believe that they can make a profit from only ISS flights, especially if there are several vendors vying for the same business.

“OK, genius,” you add, “what about Manned Exploration of Our Solar System and Beyond?”

Elon Musk is thinking about that. He’s made sure the design of the Dragon will allow it to be used in all kinds of places, like manned landings on Mars. By tying three Falcon 9 cores together to create the Falcon Heavy he will have the most powerful launcher in the world. And sorry, NASA’s SLS is still a pipe dream, folks. I’ll believe it when I see it take off from Pad 39A.

SpaceX Falcon Heavy

But SpaceX seems to be the only one thinking that far ahead. Boeing doesn’t count; the CST-100 has been built from the ground up as an ISS service vehicle. LockMart’s Multi-Purpose Crew Vehicle (AKA Orion) is designed to go to lunar orbit or to near-earth asteroids, so that’s a big plus for that vehicle. LockMart went ahead with development when the Orion program was officially cancelled by the Obama Administration, I think with a wink and a nod from NASA; since then they have received some NASA funding to continue construction of the test article and related stuff, like a simulator they build originally on their own dime. Lockheed-Martin is the largest defense contractor in the US; it’s not likely that any technology they create for the government is going to be shelved without them getting paid for it.

Blue Origin, Orbital Sciences, and SpaceDev/Sierra Nevada are all looking more at the sub-orbital and low earth orbit flight envelopes. I really don’t get what Blue Origin is trying to do; they are building a suborbital tourist vehicle, and then a totally separate ISS supply vehicle, and probably eventually a home-grown booster for it. But Jeff Bezos of Amazon fame is no dummy, and I figure he has a plan. He’s been very quiet about it, though – not necessarily a bad thing in a government-industrial-complex environment that is a lot like eighth grade in terms of gossip and favoritism. Orbital Sciences seems to be concentrating on the small satellite market. They’ve had some setbacks in launching their own home-grown liquid-fueled booster, which is needed to launch their Cygnus unmanned ISS supply craft. I really like the Dream Chaser lifting-body design SpaceDev is building; they are the only folks trying to orbit a truly reusable spaceplane. Their work is going slowly, thought, it seems.

Every single one of these approaches to manned orbital flight – Lockheed-Martin, Boeing, SpaceX, ATK/Astrium, Blue Origin, and SpaceDev/Sierra Nevada – have elements that sets it apart from the others. While all but SpaceDev are building “Apollo-like” conical vehicles, that decision makes sense. The research on such designs has been validated for decades and gives them all an easier path to building a successful vehicle. There are even several different approaches to emergency escape from a rocket in trouble, from a solid booster under the capsule to a ring of liquid-fueled engines to a traditional, Apollo-style escape tower.

Eventually, one or two of these companies might be the most successful and get the lion’s share of the orbital market. Even better, competition should bring the cost of lofting personnel and equipment to orbit far lower than the Shuttle could ever accomplish. Assisting what appear to be well-thought-out approaches with government grants makes sense only if the government is planning on being a major customer. If there was no ISS, and no NASA plans for further exploration, don’t fund ’em at all. In this case it is somewhat of an “if you build it, they will come” scenario: the commercial space market will grow – I think it will explode – when there is real low-cost access to space. We should have had this kind of situation thirty years ago, but we got the Shuttle – a massive government employment program with a marginally-performing spaceship in the middle. Government restriction to one or two competitors means a major boost for those companies and a major disadvantage to all others. That’s not how a capitalistic society should work. The fact that it doesn’t work properly in so many other areas because of the meddling of government is no reason to destroy one area where it does seem to be working. It should be seen as a model for the cooperation of the government with private industry, not as a drain on resources.

One other thing: We are talking about a half-billion dollars a year here. Maybe, through the development life of the programs, four or five billion. The average cost of flying the Shuttle for just one mission: $ 450 million!

In these days of multi-trillion-dollar social programs and continual debates about defense spending, throwing a half-billion a year at something that could lead to humanity really getting off this planet someday seems pretty small. And unbelievably petty. So there has to be something else behind it.

Oh, and what’s this nonsense from former Apollo astronauts backing the House Committee? Have they lost their senses? Or were they so tied up in the government/military-industrial complex themselves in the Apollo days to not see what’s going on now? Note that Buzz Aldrin is not among this group. Buzz is out there sometimes, but he for sure gets it.

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Romney as candidate and President

April 26, 2012

I wrote a piece on the Keep Americans Free blog about Romney as a Presidential candidate and as President, and why I think he will be successful at both. I invite you to read it.

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What’s the REAL unemployment rate? It’s scary.

March 11, 2012

I heard Rush Limbaugh – yes, that eeeeevil Rush Limbaugh – mention a piece by James Pethokoukis in The American that lays out what the real unemployment rate is – not 8.3, but closer to 9.5-10.4, depending on who is counted in it. Rather than going through all of that right here, just go read it. You may also want to read some of the comments. Usually, comments on a piece like this might be funny, but are usually wrongheaded and often just stupid. There are actually some very insightful comments following this post, and some even present their data or sources.

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What can be done about gasoline prices? Turns out, a lot.

March 11, 2012

This article by John Merline in Investor Business Daily outlines a number of ways the price of gasoline, or at least the rapid climb in the price we’ve seen recently, could be reduced.

Some of the price increase is caused by the loss of several refineries. But most of the increases in price are due to Federal government taxes, regulations, and fines. Read the article for the full list.

My favorite: recently, according to the article, “Congress left in place a 2007 law requiring increasing amounts of ethanol (including so-called advanced biofuels) in gasoline, rising to 36 billion gallons by 2022.”

The article continues: “In any case, the law has cost refiners almost $7 million in fines this year after they failed to add 6.6 million gallons of “advanced biofuels” as required. The problem is these advanced biofuels don’t exist commercially, and nobody’s sure when they will, which means even bigger industry fines going forward as the mandated use increases.” (Italics are mine.)

I don’t use this term usually, but WTF? The Federal government is collecting fines from refiners because the advanced biofuels it has mandated don’t even exist? Am I crazy, or is this completely insane?

I’m very afraid that we as a nation are sitting at home, watching basketball on our big flat-screen TVs, while the folks in Congress run completely amuck. What has caused us to feel so disenfranchised that we do not hold these people accountable for their actions?

I suppose that is for another post, isn’t it? I’d be interested in any answers you folks out there have for my question. Come on, you have the time…at over four bucks a gallon for gas, you sure as hell ain’t goin’ anywhere!