Tuesday, November 10, 2009

Can Democrats manage anything?

Yes, of course Democrats can manage to destroy the dollars they collect in taxes.  Check the recent results for Fannie Mae and Freddie Mac, both licking boots of Congress to get more money for continued massive losses.  But they've cut back on risky sub-prime-like loans.  Not to worry those of you who can't afford a home, the Democrats to the rescue.  The Federal Housing Administration, formerly an also-ran in lousy loans, is stepping up in new risky loans and already-bad ones.  It was started by FDR's New Deal and did what it was supposed to, until recently Congress gave it marching orders to save defaulting "families".  It expects 24% of its loans made in 2007 to default.  24%!  But tightening up in 2008, it expects only 1 in 5 (20%) to fail.  It has run out of margin and may join Fan and Fred in boot-licking for money.  It is another in a long line of Democrat losers.

This might be a corollary to my "Government Successes in Running Businesses" post of September 1, 2009, and upgraded from time to time since then. There is an article in today's Wall Street Journal, September 4, 2009, page one: "States Shut Down to Save Cash". [http://online.wsj.com/article/SB125202235182685075.html]. It is an interesting article with a chart on page A 6, listing states with budget gaps of more than $1,000,000,000. Of the top 10, only one is a Republican-dominated state and 9 are Democratic: (In order of size of edficit) California, New York, Illinois, New Jersey, Massachusetts, Pennsylvania, North Carolina, Connecticut, Oregon. Combined Democrat budget deficit: $114,400,000,000.

And a corollary to the corollary is an editorial in the same paper (page A17, "The Coming Reset in State Government" [http://online.wsj.com/article/SB10001424052970204731804574390603114939642.html], in which governor Mitch Daniels of Indiana, a Republican, opines that states will continue to be financially challenged way into the future. Over the past decade he writes that states have increased their spending 6% a year (8% in 2007 - 2008), building up government bulk. GDP growth over history is 3.5%. A collision is underway. Governor Daniels' state has met its obligations and has $1,000,000,000 in reserve he writes and explains why in the article. He reformed his government, cut taxes and government employees, and cut spending an average of 1.4% a year. REDUCED a total of 7% since 2004. REDUCED to being the 6th thriftiest state after being near bankruptcy five years ago. He then says his state is attracting companies with its relatively low taxes. But in searching about Indiana, its unemployment reached 10.6 percent versus the national unemployment average in June was 9.5 percent. (The state’s monthly unemployment record was 12.8 percent, set in November 1982.) While its rust belt location is affecting it, according to its governor, Indiana is ready for the future, unlike most Democrat-Party controlled states.

And yet another article ("The Michigan Example", page A 16, same issue [http://online.wsj.com/article/SB10001424052970204313604574328792152010638.html] highlights the folly and failure of central command and control of economies. Copied by the always trendy Mr. Obama, Michigan for the past 14 years has been making centralized anti-free market decisions about its economy. For $3,300,000,000 in tax credits and another $1,600,000,000 in direct spending(nearly $5,000,000,000 for a single state) to create new jobs, it has completely and utterly failed. The goal was to create 500,000 jobs and $440,000,000,000 in new investment by 2010 -- coming up pretty soon. The result? Lost jobs! (Its thorough study indicated 95 LOST JOBS for each $1,000,000 of tax credits.) And the highest unemployment rate in the nation, 15%. The subsidies and tax credits went to broadband ("One of the biggest flops in state government" said the Democrat State Senate Majority Leader.) Hollywood liberals got another bunch, creating $700,000 in income for a $4,000,000 "investment" as liberals like to characterize spending. And on and on. Michigan's Democrat answer? Raise taxes on companies in industries its government eschews, to become the third most anti-business state. But crows Governor Granholm: "President Obama's priorities are nearly identical to ours." Really.

But prudence aside, what are these states doing? California is delaying $1,200,000,000 of checks and calling it "savings". New York is putting advertising on garbage trucks, taxing sugary drinks 18%, increasing taxes on cigarettes 46% and wine 58%. Illinois has suspended a poor-people stipend for funerals of $1,103 and $552 for burial. Pennsylvania is legalizing video poker, and taxing gambling takes 50%. Oregonians must be smoking something because it asked to tax medical marijuana and for the state to grow it. These, however, died in committee. Even though Michigan isn't on the list, it's proposed a $250 licensee fee on strippers at the state's 83 topless clubs. What can top- that? -Less government?

General Motors NATIONALIZED - Free-Market Going, Going, Gone

December 1, 2009, or a few days before to the surprise of everyone except me "Fritz" Henderson, Obama's selection as CEO of GM was tossed under the GM bus and replaced on an "interim" basis that will last years ("I can't find an adequate CEO" Edward E. Whitacre, Jr. will plead time and time again.)  But truthfully this buddy of Obama handler, Rahm Emanuel, connived to get this top job the minute Emanuel appointed him as "outside", "independent" Chairman of the Board of General Motors.  He's been undermining Henderson with the Obama-appointed board from the beginning.  Now, like the war in Afghanistan, General Motors is Obama's property.  There is no way either Obama, Emanuel or Whitacre can lose.  They have the treasury of the United States to finance this corporation forever, into green, electric, small, whatever he wants it to be.  He has nationalized once the largest corporation in America.

The Obama Administration is afraid American consumers won't buy its electric cars (duh!) so he's bribing companies to make them, no matter if anyone wants them.  The method is as complicated as the federal tax code and Medicare regulations (150,000+ pages).  (Government does NOT want its citizens to understand its laws.)  But essentially the arbitrary new emissions standards can be gamed by producing electric cars which don't count as emitting carbon because Obama says so.  (That nearly half of the electricity in America comes from dirty carbon-emitting coal, and another 22% from fuel oil and natural gas doesn't count according to President Obama, who apparently can't count.)  This will bring a glut of electric cars: more than a dozen car makers are rushing to take advantage of Obama's bribes.  Including Al Gore, politician extraordinaire taking financial advantage of the "green politics" he helped create and popularize.  He has backed one.  And Mr. Gore is reported to be reaching a billion dollars of net worth in "green" politics.  Back to the electric cars: oversupply with low demand, will bring...yes, more government purchases and tax credits, rebates anything to prove Obama was not wrong.  Obama is wrong. 

The following article ("Politicians Butt In at Bailed-Out GM" Wall Street Journal, October 29, 2009, front page[http://online.wsj.com/article/SB125677552001414699.html#articleTabs=article]) explains why government should butt out of the private sector.  In additon he is "lending" $8.5 billion for car makers to retool plants and "innovate" green stuff.  President Obama and I'd guess well ober 75% of Congress do not understand, have not experienced and dislike the private sector/free enterprise/and capitalism. Please read, and cry for America.

Jerry Flint, Forbes columnist on cars (November 2, 2009 page 38) writes that America will lose in trying to build "midget cars", being we're a country of tall and large people.  (3.8 million of us are 300 pounds or more and  400,000 over 400 pounds.)  Japan has always been a better builder of small cars, and India and China are looking at our markets.  Obama's obsession with tiny, "green" cars is ludicrous and dangerous.  Peer group popularity is for what he's searching while killing jobs and America.  Goodbye Michigan, Indiana, Ohio, Iowa and Missouri. And for what?  Global warming isn't.  And cars are 25% of the greenhouse gas emissions, less than power plants, but so what anyway?  Build big cars for Americans and win.  Prosperity, jobs, wealth and an increased standard of living.  All seemingly anathema to President Obama.  Sad for America.

GM plans to dip into another $2,500,000,000 to reinvest in bankrupt Delphi Automotive LLP. GM's market share crept up by it spending $4,000 to bribe customers to buy cars. Looks good President Obama. GMAC -- financier to GM and Italy's Fiat subsidiary Chrysler -- borrowed another $2,900,000,000 in debt guaranteed by the U. S. and in addition has its hands out to Obama for an obscene $2,800,000,000 to $5,600,000,000 more directly from the government in equity, which won't be paid back. Its in hock to us (the taxpayers of the U. S. government) $12,500,000,000 already and lost $3,900,000,00. Nice investment to protect your unions, Obama. And at the same time Ford Motor Co. is close to selling Volvo to China's Geely Holding Group Co. creating another fierce competitor to GM and, for that matter, Ford itself.

Fisker Automotive Inc. will use government funds, "loans" it likely won't be able to pay back as a start-up, to purchase a closed General Motors plant in Wilmington, Delaware, just coincidently Vice President Joe Biden's home state -- it pays to know a Democrat.  The half-a-billion taxpayer dollars is planned to reopen a 62 (sixty-two) year old plant to make a "plug-in electric" car.  If opened successfully it could employ 1,500 employees.  The United Auto Workers has been closely involved in the talks.  Huh?  If all the $528,000,000 is spend for those 1,500 jobs that's $352,000,000 per job.  Ditto start-upTesla Motor's $465,000,000 Quite a coup for ObamaEconomics...well I am pretty sure much of it will end up in the coffers of the Democratic Party and United Auto Workers, one way or antother.  Competition by who you know and your ideology!  And it'll ONLY be a couple billion dollars write-offs of taxpayer money.  Or three.  Or four, all depending on 1) when Obama admits the mistake or 2) when he is out of office.

I have written posts about Chinese automobile makers.  It's difficult to place them in this post or in the "China eats the United States for Lunch" post.  Mostly it'll go there, but first, China is overtaking the United States of America as the world's biggest car maker, and is expanding from there.  While General Motors -- once the largest auto manufacturer in the country which was the world's biggest car maker, the U. S., of course.  With weak leadership afraid of its union bosses and lousy products, the U. S. has committed automobile industry suicide.  Next up?  The upcoming suicide of the United States of America itself!

But wait.  Cash for Clunkers was such a success that car and light truck sales for September for the United States' two major industrial holdings, General Motors and Chrysler, absolutely bombed.  GM off 45% (to a 20.9% market share down markedly from 29.3% a year earlier) to 155,679 and Chrysler off 42% to 62,197 (40% of which went to rental car companies)!  The U. S. total sales were off 23%.  Non-U.S. Ford only dropped 5% to 114,241 vehicles (with a market share of 15.3% up from 13.5% a year earlier) and Toyota, off 13%.  Some people think Cash for Clunkers only stole sales from September, and possibly October, at a cost to U. S. taxpayers of $3,000,000,000 and the wanton destruction of 700,000 operable vehicles that poor people could have purchased and driven.  President Obama get us out of the auto business and the "stimulus" industry,  you don't know what you are doing. 

And intelligent private market businessman Roger Penske said "no? to buying GM's Saturn brand, which now will be wound down "quickly".  The Saturn born in 1985 as an innovative approach to auto making with the United Auto Workers union bosses and General Motors executives on the same page.  Workers were 'technicians' and were paid 80% of UAW with the rest from a sharing of Saturn's profits.  Key decisions were shared by an exec and union boss.  Vision, passion and collaboration courtesy of the UAW's GM guy, Donald Ephlin.  There were broad dealer market areas and 'no haggle' prices.  Even now-green VP Al Gore touted the concept.  But it was not to be.  Union bosses feared collaboration would spread, and make them useless, so then-ew UAM militant, Stephen Yokich underminesd it.  And its GM-executive-promoter, CEO, Roger Smith retired in 1989.  Saturns were boring, underfunded and 'joined' the GM family in 2003 woth its dysfunctional relations with the UAW.  When Obama finally killed it, Roger Penske thought he could re-innovate, but no., once again it was not to be.  And not to be are collaborative relations of industry and its union bosses, who exist to create conflict.

So much for GM's brilliant new management, and super-CEO, Barack Obama..  Seven weeks ago amid pomp and circumstance, GM announced it was going to sell its cars on eBay.  Today the last day of September, it's a bust and being discontinued.

U. S. Government- and union-owned General Motors is trying to sell its Opel unit to Magna International.  But here is the matter with central control and planning.  The deal with magna seems to be unwinding because the Spanish government, the German government, the English government, the Belgium government...all don't care a whit about the financial success of Opel, they are only interested in getting reelected for which they need their union bosses.  So these governments only really care about holding onto union jobs.  Opel has factories in each of these countries.  A deal might not get done, shackling GM with the huge Opel losses.  Stay tuned!

This is a series of comments about President Obama's takeover of GM and Chrysler for the primary benefit of his major supporters, labor union bosses. And other auto-industry stuff.

More Washington DC manufacturing.  For the three-wheeled Aptera 2e, Aptera Motors Inc.,Vista, CA, like everyone else, wants some government money.  Only $75,000,000 though from the Energy Department, but Congress then (2007) said three wheelers don't qualify.  So what to do?  Get the Democrat Congress to change the rules.  Especially when Aptera's investors are long-time and large contributors to the Democratic Party; in 2008 just a few accounted for $1,000,000. So obviously it's not the free-market vetting start-ups, it's money for re-election.  (Tesla Motors another California start-up along with Ford and Nissan has already received $8,000,000,000 in "loans" from Democrats with taxpayer money.)
I don't know whether this should go into some post about central command and control of government or the end of the free enterprise system, or here.  So here it is.

Fisker Automotive will be lent -- and how does a start-up repay? -- $528,000,000 to develop two plug-in electric cars including Karma a $87,900 sports car certainly targeted toward Obama's middle class sweet spot.  The money will go toward engineering since the car will be manufactured in Finland, but with bribes to buy Karma, it will ONLY cost $80,000.  The Obama People's Car. 

Update as of September 15, Chrysler's sales in September are expected to fall 30% year to year, double the decline for the U. S. in general.  Yes, Mr. President, you put in cash for a clunker and gave it to an Italian.  Good move.

So the future of the American taxpayers' investments in the auto industry it would seem is based on President Obama's decision to "go green" and that even given U. S.-made cars' much higher price, perceived lower quality, and mediocre technology and what is shaping up to be fierce competition not only to sell cars but to get U. S. government largesse, GM and Chrysler, among other auto-realted companies, must sell many, many more cars. In a market which so far has not bought a lot of "green cars" why will Americans suddenly want small, slow and difficult cars? I doubt they will. And a really funny irony is that the new green Obamamobiles run not on electricity -- electricity is a middle-man -- but on coal (48.5% of U. S. electricity production), natural-carbon gas (21.3%) and petroleum (1.1%), and nuclear (19.6). Other than hydroelectric (6%), so-called alternative energy accounts for 3% of U. S. electricity production. So exactly what's green Mr. President?

Even though Chrysler is planning to produce the Fiat 500 in Mexico (so far) thus opposing the United Auto Workers Union (so far) Obama will not do the same to trial lawyers, major supporters of the Democratic Party. Chrysler will allow and  finance future tort lawsuits against it even though they could have been legally abrogated in bankruptcy court. A major financial victory for trial lawyers and the Democratic Party. Not so great for the U. S. however, or for the UAW for that matter.

So American Axle & Manufacturing Holdings Inc. has reached agreement to get $210,000,000 from GM whose dough comes from the U. S. Government, its major owner; well actually not the government, from taxpayers, well not actually from taxpayers, from lenders like China. Is this like a Ponzi scheme?

Buick the upper-end brand for old folks from GM is jumping into the crowd. It will stake some of its future on a...Duh!...hybrid, thanks to its owner, the U. S. Government and the Democrats. Buick will apply for a $500,000,000 loan (and who will pay it back?) from the $25,000,000,000 program to fund production of more fuel-efficient cars. And GM's battery supplier will apply for another $400,000,000 (and who will pay it back?) Just a cautionary question from a businessman. If all car companies take the U. S. government's money and build millions of (so-far unproven) hybrid's just who will buy all of them. The industry will be flooded with these cars, which are also unproven in the marketplace. That's one of the great things about having one czar run the czars: he makes the decisions, the messy market doesn't. And if it all fails? Mr. Obama'll retire a very rich man.

August 17: Chrysler made an announcement that it is planning to produce its Fiat 500 subcompact in Mexico. Take that, Obama. Take that, UAW. I am betting that the decision will be changed and the car will be made in America by the UAW, owner of 55% of Chrysler to the U. S. Government's 8%.

Trade restrictions caused the Great Depression, among the three major causes. With the U. S. government owning most of GM and some of Chrysler is there any doubt that policies will favor those "investments"? And thus will come counterbalancing restrictions by other countries possibly Japan, South Korea, Germany, India, China? I guess the only thing that would weigh against that is the humiliating fiasco of Obama's Cash for Clunkers that sold 1) Toyota Corolla 2) Honda Civic 3) Toyota Camry 4) finally an American brand, Ford Focus FWD 5) Hyundai Elantra 6) Nissan Versa 7) Toyota Prius 8) Honda Accord 9) Honda Fit and finally number 10) another American brand, Ford Escape FWD. Where were the U.S.-owned brands, GM and Chrysler?

GM's new strategy in part driven by AT&T's former chairman, now Obama's pick (actually Rahm Immanuel's pick as he recently did a deal with Whittaker) for chairman of GM is to culitvate a "green image". Sure to sell a lot of cars in the United States where horsepower can be compared to the size of a man, so to speak. That Chevvy Volt with a range of 40 miles should certainly be a big seller. I can hear the former Corvette owner saying, "Dude, I can get 40 miles to one charging and go from zero to, hmmm,35, Dude." Even with the government's $7,500 bribe it'll be markedly more expensive at $40,000 than Toyota's Prius at $22,000. GM's chief executive Henderson is on the Fritz. And Obama and his czars must be back on cocaine.

Today (August 25, 2009) GM reconsiders selling its Opel and Vauxhall -- a strategic reversal. GM prexy Fritzy Henderson thinks maybe he'll put together a $4.3 billion financing at the direction of the Obama Board of Directors, and maybe will keep the company which has lost money since 2000. The former near-sale to Canadian Magna International and a Russian-state-controlled bank, OAO Sberbank and OAO Gaz car company with the support of the German Government. (Much of Opel's parts are made in Germany by highly espensive union plants.)

But a couple days later, GM is pummeled by Germany politicians and union leaders for its turnabout. "What are they thinking", Germany must think, a broke GM would need $4,300,000,000 to try to turn around Opel (money it doesn't have and that its superCEO, Barack Obama, stated it wouldn't get) and which might not EVEN count $2,100,000,000 the German government made to Opel to keep it breathing during this sale process. STAY TUNED!

Managed like Katrina, but praised by the liberal media for causing more cars to be sold because it was conceived and (mis-)managed by Obama, Cash for Clunkers ("CARS") will terminate over this weekend. If Bush would have run it, it would have been a highly-publicized fiasco when neither car wreckers(owners)nor auto dealers were getting paid by the government bureaucracy, but not now. Complaints aside, the fact that cars were crushed and new Japanese and Korean cars, and a few Americans, were ordered but not paid for, it was deemed a smooth success. Yeah, sure. And, of course, auto sales will fall off a cliff soon because of its end.

Here in Seattle, the federal government is throwing around "millions of dollars" (according to the Seattle TImes, August 6, 2009, page B 1) to equip streets and homes with charging stations for the electric cars of the future. 2, 550 stations for an unknown amount of cash spread "around the Seattle metropolitan area, including the eastside". And what's great it'll only take four to six hours to charge at home, shorter for the fifty "fast commercial chargers" which will charge a fee.

They will be established by Ecotality, parent of Electric Transportation Engineering Corporation (eTec). eTec is Caymen Islands-registered penny stock traded in the "pink sheets" typically inhabited by speculative, money-losing and many times ethically-challenged companies. The Company recorded a net loss for the quarter ended June 30, 2009 of $3,600,845 million, compared to a $909,602 net loss for the quarter ended June 30, 2008. ECOtality recorded a loss per share of $.02 for the period ended June 30, 2009, compared to the loss per share of $.01 for the same period in 2008. For the quarter ended June 30, 2009, ECOtality achieved revenue of $1,747,085 compared to revenue of $2,936,150 for the quarter ended June 30, 2008. August 19, 2009: it closed at 24 cents per 206,900,000 shares with a high of 46 cents and a low of 2 (two) cents and is traded on the so-called "pink sheets' And looking at the "management" team and one sees a group of what seems like hustlers, who obviously know someone in government. I have seen similar companies tout their stock prices, and unload when the time is right. I am not accusing eTec or its management team of anything. Yet. More to come. Oh, here's a government connection:
Colin Read, Vice President of Corporate Development, ECOtality, with the responsibility of overseeing the marketing, public relations, strategic initiatives and business development. Read has significant experience in politics, public relations and traditional media. Before coming to ECOtality, Read was the Assistant Finance Director on a successful congressional campaign for an Arizona Democratic in the 2006 national mid-term election.

Ford Motor Co. is launching a "Smart" charging technology for recharging the planned electric cars that are upcoming in months or years ahead. This unproven technology is supposed to curtail recharging of these non-existing cars during high-cost peak grid-use times. There are over 3,000 different utility companies all of which will provide electricity differently. And, oh yes, wind and sun will provide some electricity too, somehow. Apparently Ford cars (GM has it too, it said) will communicate with utilities through some magic. GM's magic is OnStar, a wireless thing? Whatever. But you and I -- we -- are providing $5,900,000,000 to Ford from the Obama Department of Energy to retool some of its plants. And to make get this 5,000 - 10,000 electric cars in 2011. $5,900,000,000 divided by 10,000 is $90,000 per. I hope they simply give them to Congress and the Administration. This "Smart" technology seem pretty "Dumb". Not to mention expensive.

An article in today's Seattle Times (August 11, 2009, page A8) [http://seattletimes.nwsource.com/html/businesstechnology/2009635915_autoupstarts11.html] discusses entrepreneurs in the automotive manufacturing business. Enterpreneurs are the basis for the wealth of America and from little 41-employee Coda Automotive in Santa Monica to hugely successful Penske Group (shopping for cars to sell through the Saturn dealership network it agreed to acquire from GM) they are taking aim at innovation in the industry in order to gain wealth. Actually Chinese and Indian companies are looking here, too. But the Obama administration's insane support of union labor bosses in throwing taxpayer's money at Chrysler and GM will make success by non-government entities difficult but not impossible because competing against and bettering government "companies" which don't have monopolies is pretty easy. The $100,00,000,000 into GM and Chrysler might be deemed a monopoly by any rational person. But Obama is going after Microsoft and Yahoo, brilliant successful innovators, instead.

WASTE NOT, WANT NOT. NOT. (Not if it might a mean re-election cash giveaway.)
Obama crushes cars and gives away $3,000,000,000 of taxpayers' money (well, borrowed from China). His "Car Allowance Rebate System" ("CARS"), throws away billions of dollars worth of privately-owned, generally perfectly good and running automobiles to keep the union workers working. (Just some calculation: $3 billion divided by $4,500 equals 666,666 cars thrown away. If each is worth, say, $10,000 -- I'd guess a low figure -- that's $6.7 billion of assets thrown away. Thrown away. Disposed of. Torn up. Burned. (In a recession purposely destroying $6.7 billion is insanity.) And targets $2,400,000,000 to jump start votes in upcoming elections in the midwest (which is hidden as electric car manufacturing.) Venture capital? Nahhhhh. Democrats pick which companies -- 48 different ones -- to back. And the government would buy thousands of electric cars from GM, Chrysler and Ford. Toyota in the meantime is struggling to sell its highly-publicized Scion-brand "green" cars (sales crashed 58% so far in 2009). So take billions of taxpayers' dollars from them (money THEY could use to choose cars they want to buy), destroy thousands of used cars they could buy, offer electric cars they don't want to buy, and have the government buy those unwanted electric cars. Free-enterprise? With no wealth creation we will be bankrupt in 5 years. The wonderment of enterprise by power-mad people using others' wealth. ANGRY? YOU BETCHA.

Top ten destroyed cars: 1. Ford Explorer 2. Ford F150 Pickup 2WD 3. Jeep Grand Cherokee 4 WD 4. Jeep Cherokee 4 WD 5. Dodge Caravan/Grand Caravan 6. Chevrolet Blazer 4 WD 7. Ford Explorer 2 WD 8. Ford F150 Pickup 4 WD 9. Chevrolet C1500 Pickup 2 WD 10. Ford Windstar FWD Van.

Top Ten New Car Purchases: Cash for Clunkers 1. Toyota Corolla 2. Ford Focus FWD 3. Honda Civic 4. Toyota Prius 5. Toyota Camry 6. Ford Escape FWD 7. Hyndai Elantra 8. Dodge Caliber 9. Honda Fit 10. Chevrolet Cobalt. Americans want Japanese cars.

Oh, by the way, where will all these government employees charge their government-purchased and -owned electrics? No where. There is no infrastructure to do it. So certainly the government will put wires and plugs all over the place for billions more. But to do so will take huge and highly-dangerous 240-volt charging stations (Only 110-volt current is widely available in homes and offices). What are these royal idiots thinking?

"Cash for Clunkers" $1,000,000,000 blown in a week starting July 24. Good planning Obama. Katrina-like. So now go to Congress and get a couple more. What did it cost to write regulations? To keep dealers honest, I imagine. They need to exactly adhere to Obama's 136-page manual for dealers including how to kill the Clunkers engines with sodium silicate. 136 pages! But wait, the Environmental Protection Agency developed a list after reviewing 30,000 different car models of acceptable cars. But wait! It changed its mind and revised mileage ratings eighty-sixing 80 models and adding 50. This week. (At what cost?)Clearly, all this will cause more sales of new cars, but 1) will it simply steal from the future? 2) steal from the past, with new buyers having waited for it, after its announcement? 3) do anything for the future jobs and the economy? $1 billion down and $2 billion more apparently coming. The plan is expected to result in 250,000 new sales, or 110,00, or 40,000. No one knows and there'll be no way to prove anything other than $1,000,000,000 or $3,000,000,000 will be borrowed from China to pay for it. (I wonder if my children or grand-children will have to pay this back.)

Just read that our wise administration loves BMWs, Mercedes, and, I suppose, Indian Jaguar, not to mention Suzuki and other Japanese car companies that compete bitterly with Obama's own GM and Fiat/Chrysler. Heck these guys won't have to curb greenhouse emissions if they sell under 400,000 cars in the U. S. each year. What is this CEO of America thinking? Obviously he doesn't have a clue about competition and free enterprise. GM and the American taxpayer will be the big losers. And as for Obama's GM initial public offering next year? What a sad, sad laugh.

GM sales off 32% for the second quarter from the year before, in North America and off 15% globally. Keep up the good work, Mr. Obama.

Private-market Ford Motor Co., however without government largesse returned to profitability in the second quarter

As of July 23 the U. S. Government will be into its auto industry another $6.2 billion by taking on the retirement plans of 70,000 retired Delphi Corp. employees.

Conflict in management. Bob Lutz, car-guy at GM (and architect of its new hot-selling Camaro) said GM would keep its high-horsepower Pontiac G8 by turning it into a Chevvy. But finance guy and CEO Fritzy Henderson said no. It has too much horsepower and Obama wants slow cars with high gas mileage. None of this macho stuff for our urban president, even though the G8 sales are up 57% this year. But as it will continue to play out, sales prospects (which might bring those hated profits, have little to do with Obama's automobile agenda.

Politics as expected is rearing its non-profit head with GM's selection of a new plant to build its new compact car. The most selection criteria were 1) community impact and 2) carbon footprints. Michigan -- a key election state for Democrats next year -- was chosen over mainly non-union Tennessee and Wisconsin. Originally, of course, a business-like GM wanted to import the compact from China. NO WAY, said politicians who actually do run GM. It is expected that the U. S. build car will lose money upwards of $1,000 to $2,000 on each sale. Rep. Barney Frank (D-Mass.) is one of them guiding GM's plant closing strategy.

Chrysler appointed 5 new directors. A hedge fund manager, George F.J. Gosbee; Douglas Steenland former Northwest Airlines CEO; Scott Stuart, another hedge fund manager; Ronald L. Thompson, Chairman of Teachers Insurance and Annuity Association; and Stephen Wolf, chairman of R. R. Donnelley & Sons, Inc., a media company. Continuing Obama's course, none of these people have automobile industry experience and are supposed to put together a long-term plan to include small cars that Obama demands. Its sales were off 42% in June from a year ago. The government owns 8%, Fiat initially 20% and the United Auto Workers, represented by former Michigan governor James Blanchard, represents its 55% ownership. In all likelihood, Fiat will be running Chrysler as its CEO, Sergio Marchionne, is CEO of Chrysler also.

July 7, Fiat SpA which was given Chrysler for free by President Obama (and to the United Auto Workers Union also) is setting up a joint venture with Guangzhou Automobile Group to produce 140,000 cars and 220,000 engines in China when it gets running after May 2011. The total investment -- in money, unlike with Obama and Chrysler, will be about $559,00,000. Remember, China is General Motors largest market. So Obama's GM will be competing there not only with Chrysler, after its being given away by Obama, but possibly with itself in the form of Opel, which GM is selling.

Obama has had a new board of directors appointed to run GM. None seem to have automobile industry experience. Like his Auto Czar, Steven Rattner, they are major Democratic Party funders and fundraisers. (Actually Rattner resigned July 13, 2009. Leaving one to wonder if something about his hedge fund's, Quadrangle Group, fund raising might have been illegal.) Obama's GM Chairman, Edward E. Whitacre, Jr., turned AT&T into the largest U. S. wireless telecommunications company which is now being investigated by Obama's Department of Justice for antitrust. Oh, yes, Whitacre has zero auto industry experience.


Chinese-government backed company wants to buy GM's affiliate Opel which has extensive sales in China to grab GM's technology as described in my post, "China Eats the U. S. For Lunch" below. If Obama allows it (GM wants the sale), his company, GM will compete in essence with itself in what is becoming the the largest market for autos and trucks in the world, China, against a Chinese-backed company. And Obama needs to continue to guarantee GM's survival to keep those United Autoworkers working. Dichotomy for a man who does not understand nor support business. China is on track for more than 11 million autos in 2009 up more than 15% while the U. S. market is expected to drop to well under 10 million, off over 30%. GM's China sales are up 38% for the first half of 2009, to over 800,000.

June 29, GM agrees to take on future unknown potentail liability claims from car-accident victims. Under the original bankruptcy plan these liabilities were to stay with the unwanted, virtually-valueless "Old GM". My guess is that the pressure of Democratic Party-co-owner the trial or tort lawyers wanting their cut of such future claims settlements, a portion of which flows into the bank accounts of Democrats, forced this "settlement" which also obligates the U. S. Government.

Interesting article, June 26 described GM's arm GMAC LLC curtailing financing for dealers of arch-competitor, Chrysler (given to Italy's Fiat -- a foreign company -- and the United Auto Workers with U. S. taxpayers' billions of dollars.) On the surface this seems somehow illegal or certainly immoral: using government money to hurt a competitor. But America you haven't seen anything yet. Also same date, GM announces plans to close a plant in Louisana -- possible 2012 presidental contender Bobby Jindal's state.

Old headline: "That's Obama Tough! Obama drives General Motors, unions get their wish"

Interesting car article in the Wall Street Journal, Wednesday, June 17, 2009 page D 3. ["Muscle Car's Test Drive Turns Heads" http://online.wsj.com/article/SB124518581645820381.html]. Apparently ObamaMotors' division General Motors' division Chevrolet ("Chevy") has a sellout. A sellout! In a car designed by Obama? Not quite. It's a 304 hp V-6 or 426 hp V-8 muscle car, the new Camaro. And it's outselling an Obama clone, the new Honda hybrid, the Insight, two-to- one. Meanwhile Chevy is killing another slow-selling Obama clone, the hybrid Malibu. But CEO Obama, you should stop the Camaro, and other fast-selling muscle cars, the Ford Mustang and Chrysler's 500 and Dodge Challenger before it's too late.

Fiat is coming back to the United States, courtesy of President Obama virtually giving Chrysler to it and the UAW free of charge. Its first entry here was a flop. Why? In the early '80's Fiat's quality reputation was so bad it was nicknamed, "Fix It Again, Tony" and couldn't sell enough cars to stay in the U. S. Hopefully President Obama will be on the line to check the quality of his cars.

But after giving Chrysler to a foreign company, note that Saab Automobile AB might be bought by an entrepreneurial boutique sports car company, Koenigsegg Automotive AB, from GM/Obama Motors for money. Christian von Koeniggsegg's company now makes very limited edition supersportscars for the supersportsrich. About $1,000,000,000 will be invested.

Auto bailout-management news in this continuing blog will be newest news on top.

Bad News for U. S. Auto Industry President Obama: Mitsubishi Motors Corp. expects only 2,ooo electric cars to be produced for 2010 (because of the high cost of its newly-launched i-MiEV, $46,500) and less than 20% of its production by 2020!

Here is an absolute outrage (June 5, 2009): General Motors, now "flush" with $30 billion of U. S. Government cash has agreed to invest some of it -- $2.5 billion, or 70% of the price -- to finance Tom Gores' Platinum Equity firm's buyout of bankrupt auto-parts company Delphi Corporation. WHAT? Obama is providing our cash for a highly-speculative investment, the rewards of which success will NOT accrue to the U.S. but to an individual. You can bet Mr. Gores or his friends and family have made significant campaign contributions to the Democratic Party in general and the Obama election specifically. I'll research this issue in the future. Update of June 11, U. S. Bankruptcy Judge Robert Drain blew off Obama's hand-picked winner of Delphi to sell the auto parts maker at an auction. At least one judge believes in the rule of law.

(And non-political-non-running-GM President Obama called the mayor of Detroit and reassured him that GM would stay there in the Renaissance Center. And more phone calls were made from the Administration or so sayeth the Detroit News.)

And there will a huge Obama expansion of Ethanol, proven to increase food prices by 10% - 15% and, according to the EPA's Office of Transportation and Air Quality, the new land (from slashing forests) to grow grain for Ethanol will increase greenhouse gases. In other words, Ethanol will bring an increase in greenhouses gases vs. simply using gasoline. And it only costs the taxpayers and consumers roughly $10 billion. But it buys the votes Congressmen want. That's what is important.

On the Web tonight (6/9/2009):
"EYES ON THE ROAD, by Joseph B. White
from The Wall Street Journal.
A new survey shows the economy has damped consumer interest in new auto features and gadgets, including hybrid technology and onboard navigation systems.
(http://online.wsj.com/article/SB124450736037596339.html?mod=djemroad)" But customers will certainly spend upwards of $2,500 more for Obama's Little Green Lemmingmobile that gets 27 Miles for Each Gallon consumed, that's certainly an attractive attraction, especially if the government pays the entire cost of the "car".

The Obama administration's less-favored auto company Ford Motor Company, because it didn't take his strings-attached monies, raised some 5-year money to finance customers. Price 8% interest. GMAC/Obama raised some money too, backed by us the U. S. Government. Price? under 2%. Competitive differential. Could be life and death. This, ladies and gentlemen, is the result of governmental industrial policy. President Barack Obama decides between life or death for the largest American companies.

The Obama administration pushed an "alliance" AKA give-away of much of Chrysler to Fiat SpA. In the mad rush, Chrysler executives were dissuaded by the government from getting key due diligence materials describing the fiscal health of Fiat and information about its true willingness to share required technical information. No matter, Obama seemed to say, we simply know this deal is good. For someone, how about the union and a foreign company. Fiat can walk if the deal isn't closed by June 15, hurting the United Auto Workers union. Why would Fiat walk? It gets for nothing an initial 35% stake potentially rising to 50%. And make no doubt. The Unites States Treasury, not Chrysler, in the form of former UAW boss, Ron Bloom, is managing the transaction and Chrysler's figurehead, Robert Nardelli defers to him.

June 1, 2009: General Motors is renamed ObamaUAW Motors, except the UAW didn't want common stock, it got preferred stock paying about $600 million a year and few economic changes to its contract, but can't strike until 2015. And its unfunded pension funds covering roughly a half million former workers and dependents is underfunded by around $13 billion, which ultimately could become the obligation of the U. S. Government. New car warranties, an uncertain amount of money, are already guaranteed by the U. S. "We" the U. S. taxpayer -- and, of course those citizens who don't pay taxes -- will own 60% for around $50 billion; The United Auto Workers Union get 18% for nothing; the Canadian government 12% (for $9.5 billion); former bondholders, 10% for $27 billion; common stockholders zero, nada, nothing. Essentially the Obama administration doled out ownership of once the world's largest company according to favoritism and political strength. The Obama administration will have GM and Chrysler to prove its green agenda is sound by making the car companies manufacture "little green cars" in UAW-manned domestic plants. No imports will be allowed, courtesy of Congressional meddling. And as for micro-managing and meddling the CEO will have two multi-headed bosses: the Obama administration, including personnel of the departments of energy, labor, treasury as well as the nearly 400 members of Congress and a few thousand of its staff. Stay tuned for the biggest spin in history. "The success of Barack Obama as chairman of the chairman of General Motors, and, well, Chrysler a little bit."


May 26, 2009: The United Auto Workers told union officials that it has agreed to a deal with General Motors that will lead to the union owning 17.5% of the company once it restructures as part of GM’s obligation to fund future retiree health-care obligations; GM will place $10 billion of assets into a Voluntary Employee Beneficiary Association, or VEBA, on Jan. 1, 2010. The UAW will also receive a new note, payable in cash, for $2.5 billion. That note will be paid out in three installments taking place in 2013, 2015, and 2017. The UAW told their president that it didn't trust the future prospects of GM, so it wanted more security. Notes and cash, less stock. And he responded, "yessir, yessir, whatever you say.' And the United States taxpayer via its government will own

May 23, 2009. One step on the road to wherever, General Motors revised its agreement with the United Auto Workers. Huge burden for the union. No raises. What! Yes, can it be believed, the company is facing extinction...[well, it asked for $2.6 billion more and Obama gave it $4 billion, so much for...extinction, with the President of the United States propping it up with taxpayers' money...anyway back to the UAW's "suffering"]. No raises. While the country's non-governmental citizens are losing their jobs left and right, the UAW workers won't get raises. That's no concession that's a slap in the face to ALL AMERICANS. Or at least the 93% who aren't unionized (private sector). And no pension increases, oh, the employees might have to pay a little more for their healthcare. There are job losses, though, maybe 20,000 a third. And no strikes until 2015. I guess you can't strike a non-existent company. Finally, the UAW will own much of the playing field: 39% of GM. And yes, the chief "negotiator" for the government is a former union boss!

May 21, 2001. President Obama once again bails out GMACLLC with a $7 billion "down payment" on top of Treasury's $5 billion, I guess, pre-down-payment in December 2008. And another $7 billion "payment" could end up with the U. S. Government owning GMAC (as well as GM) within a few months. And with its (job-killing) dictate of new fuel economy standards of 35.5 miles per gallon by 2016, is it anyone's doubt that GMAC and the government will continue to burn dollars in the gas tanks of United States-manufactured automobiles that few citizens want. We will have lost our freedom to buy what we want.

This blog began months ago with the following:
"Child don't you do that...Or I'll...I'll...I warn you...I'll...I warn you...Time out!...I mean it...Oh, well...I'm sorry...Oh, OK do what you want, have fun!" Threaten, threaten, but don't follow up.

Or: "In for a penny, in for a pound".

Or: "If you're gonna play the game, boy, ya gotta learn to play it right.You got to know when to hold 'em, know when to fold 'em,Know when to walk away and know when to run.You never count your money when you're sittin' at the table.There'll be time enough for countin' when the dealin's done.

Or was President Bush smart by a half to put in some dough to GM and stick Obama with the it? Well, no, he's not that cunning or smart.

Basically I knew Obama does not have the grit to say "enough" once government got entwined in the auto business. He is not a strong, self-confident personality. We are in and it will not stop...with car companies, suppliers, financiers, warranty-guarantees, ONE HUNDRED MILLION DOLLARS here we come. Fictitious quote of Obama: "Who cares, it's only the stupid taxpayer's money. And we need to get it to the UAW."

Updated news April 30, 2009. A new offer by holders of about 20% of the $27 billion unsecured GM debt outstanding asks for a 51% ownership of the company, the same valuation being offered the United Auto Workers union by the U. S. Treasury. This would leave 41% in UAW hands and 1% to present equity owners. The $15.4 billion debt to the U. S. Treasury would remain. It seems obvious the Obama Administration wants to own GM in conjunction with the UAW...its proposal would give 39% (and $10 billion cash) to the union and leave 51% to the government for $7.7 billion in debt forgiveness. The remaining 10% would go to bondholders for their $27 billion. Do the math. It's a monumental theft of bondholders' money and rights.

Yes, President Obama today (March 31, 2009) took control of General Motors by firing its CEO, the hapless fall-guy, Rick Wagoner (who leaves apparently with only $21 million comp), to "prove" he's tough. And he, Obama, once again threatened bankruptcy for GM and Chrysler, but this time he really, really means it. The first time GM was loaned $17.4 billion and the government really meant to get tough. But no money this time unless GM could get GM bondholder approval to cut the debt, the United Auto Workets to agree to alter contracts and draft a recovery plan or something on paper...well, "just kidding about that": the two "requirements" were waived and the paper deemed not worthy enough. But today he's really, really going to get tough! Oh, today he also guaranteed new-car warranties, and made provisions for the government to quickly purchase a bunch of cars and to perform some weird scheme to buy back old, gas-guzzling cars and give a tax break for new car purchases. And buyers can deduct, excise, state and local sales taxes they pay to buy new cars. That's Obama Tough. As for Chrysler, which only got $4 billion in December, the government gives it 30 days and $6 billion if Fiat buys some of it...While Fiat wanted up to 55%, Obama, being tough, would only allow 20% to show them forineers (Chrysler and Fiat negotiated 35%, but that doesn't count, it's what Obama demands); and the government will give it working capital until then. But a serioius threat is to the poor holders of the auto companies' debt. GM has $29 billion unsecured and Chrysler, $8 billion, secured. Obama means it this time that it must be slashed. He also toughly stated that the companies couldn't depend on "unending" (my emphasis) taxpayer loans, but what is the meaning of "unending"?

Have no doubt, the Obama Administration, Congress and Labor Union Bosses ("Government") know better how to run companies. Just look at California, Amtrak and the U. S. Postal Service. (Not to mention TARP.) It's simple, design cars Congress wants: small, low-powered with high MPG, or pedal; and maybe always black because that's cheaper, (and diverse). And all the same. It worked for Henry Ford. But, of course, he made cars for the consuming public, who bought. Congress has mandated cars that the public doesn't want: small, low-powered with high MPG. Congress can mandate that the public buy, and it will pay for, the cars. Keep those union bosses in power at all costs. Newly anointed-by-Obama CEO, Frederick "Fritz" Henderson immediately played down the need for an entirely new labor contract!

Speaking of which there is a rule passed in Congress' 1975 fuel economy law (1975 Energy Policy and Conservation Act Public Law 94-163) nicknamed the "two fleets rule" which I have read but fell asleep at the circumvention, circumloquation and maze-ness of it.

(Fleet fuel economy is calculated using a harmonic mean, not a simple arithmetic mean (average). The harmonic mean is the reciprocal of the average of the reciprocals of the fuel economies of the vehicles in the fleet. For a fleet composed of four different kinds of vehicles A, B, C, and D, produced in numbers nA, nB, nC, nD with fuel economies fA, fB, fC, fD the CAFE would be:
For example, a fleet of 4 vehicles getting 15, 13, 17, and 100 mpg has a CAFE of slightly less than 19 mpg:
While the arithmetic mean fuel economy of the fleet is 36.25 mpg:

[the formula is too funny to reproduce]

One feature of the above law is that these these cheap-small-dangerous cars must only be made in domestic UAW plants, which guarantees losses on each car. But the Obama Administration will make it up on volume. But no matter what, the UAW will retain its monopoly, even if it has to cut retirees off and drop new hires' wages a penny or two. Keep those dues flowing, Mr. President from 140,000 UAW workers the Democrats need it to keep in office. I don't know what part of their wages (which are double the non-union and successful "foreign" U. S. manufacturers in the South, Nissan, Honda and their ilk) go to Democrats, but it's sizeable.

Poor Ford Motor Co.; it will be penalized for being successful and not taking the government's money. Ford -- all by itself -- is achieving some success in paring down the monopoly-UAW's huge wage and retiree healthcare costs and some of its lenders' debt. Ford now will have to compete not only with domestic and domestic/foreign and foreign manufactures, it'll have to compete with the U. S. Government. This scenario continues the democrats' punishment of the smaller numbers of successful companies and people for rewarding the greater number of voters who are not successful.

And today, April 15, 2009, in a Wall Street Journal article, "U.S. May Take Stake in GM To Pay Off Loans" (http://online.wsj.com/article/SB123972054506117179.html), the government cannot find private investors for a "revamped" -- split-apart, or Good guy-Bad guy -- General Motors to which the U. S. Government has loaned $13.4 billion. The recourse, of course, trade worthless debt for even more worthless "equity" in laughably "stripped down" company hoping, against hope, that the United Autoworkers (owner of the Democratic Party) will accept some concessions and some bond holders who are owed some $29 billion, including over $5 billion to individual "widows and orphans" who bought the security of GM bonds.

Today, Friday, April 17, 2009, Obama presses GM to rid the GMC truck brand which started up in 1912. Wall Street Journal (http://online.wsj.com/article/SB123989177238225323.html). GM also might shutter Pontiac and sell Hummer, Saturn and Saab. While GM is rushing to meet Obama's "deadline" of June 1 to transform itself, the United Auto Workers put its GM negotiations on hold while it concentrates on talking to Chrysler. Extraordinary how someone who's never run anything is remaking one of the largest corporations in the world in 60 days. (Around the World in 180 Days has nothing on the Obama Administration!) And apparently CEO Fritz is mentioned a need for more cash.

And an update, Thursday, April 23, 2009. "GM Plants to take Extended Break page B1. (http://online.wsj.com/article/SB124041946006244177.html) GM plants are planned to be idle two months this summer, but the United Auto Workers will still get paid, as the Obama Treasury Department is finalizing another $5 billion in aid (aka "loans") to it. While the unions skate, Treasury is trying to get GM lenders to throw away $28 billion in their loans to GM in exchange for, yes, GM STOCK. Hey, guys, what a great deal! And GM will not make the required $1 billion debt service payment due June 1. And on to Chrysler, "Banks Get New Offer for Debt in Chrysler" page B1 (http://online.wsj.com/article/SB124044878863646087.html). The bid by Treasury is 22% back of $6.9 billion SECURED debt and 5% equity in the new Chrysler. The ask by lenders is 65% and 40% plus a board seat. The lenders, led by U.S. subsidiaries, Citigroup and J. P. Morgan Chase, essentially are negotiating with their owners, or soon-to-be owners, us the U. S. Taxpayers represented by our Treasury Department. A tangled web we weave. At the same time, Treasury is offering United Auto Workers 28% of the $10.6 billion it's owed for retiree healthcare costs plus some stake (steak?) in the restructured Chrysler.

Tuesday, April 28, 2009.
General Motors, controlled by the Obama Administration, offers the United States of America, represented by the Obama Adminstration a majority stake. We the taxpayers "invest" another $11.6 billion on top of the $15.4 billion already in, $27 billion total, and get "at least half" ownership. (GM's market capitalization is $1.3 billion.) The United Autoworkers Union would get 39% of GM in exchange for $10.2 billion owed the UAW by GM (half of the obligation), And for at least 90% of the $27 billion in unsecured debt, bondholders would get 10%. GM would slash U. S. dealers to 3605 down 42% by 2011 and kill Pontiac. What a deal for Obama Administration which owes its election to unions! Guaranteed support in 2010 and 2012.

Chrysler would give the UAW 55% of its stock plus notes for $4.6 billion owed for retiree health funding, Fiat SpA up to 35% (for some small car production, creating 4,000 new union jobs, use of Fiat engines and some cash) and for exchange of $6.9 billion of secured debt, present holders would get a 10% interest in Chrysler. The UAW would give up cost-of-living increases, put limits on overtime pay (payble only after 40 hours a week), and lose Easter Monday in 2010 and 2011! Seems the union gives little and gets immensely.

At issue on another front: Chrysler and GM dealerships -- now about 10,000 owe "flooring' of around $25 billion which could be called in the event of any bankruptcy. There are 1.1 million unsold cars in dealer inventories. Only 660,000 were sold the first quarter of 2009.

In the meantime, bills to provide government-funded discounts of $1,500 to $5,500 for people to trade in old cars for new ones. Congress feels it is desperately needed to lift slumping car sales. "Cash-for-Clunkers". This is an interesting contradiction to the probably increase in new car prices from Obama's MPH mandate of in excess of $2,300 ("only" $1,300 projected by the White House and upwards of $3,778 and $5,877 for light trucks, according to Sierra Research for the National Highway Traffic Safety Administration). And apparently Obama's 35 MPH will settle at 28 after adjustment by Environmental Protection Agency! But in order to meet Obama's mileage restrictions, cars will have to be lighter. And lighter cars kill. The only statistics available indicates that in 1993 between 1,300 and 2,600 more people were killed in collisions of the then-lighter cars than the heavier ones of 1976. But these deaths will reduce Obama's cost of healthcare "reform".

And there is a tax credit subsidy possibly available to retired auto workers, those very same people who will be paid out of any auto company bailout or bankruptcy filing. It was just made more generous by Congress to cover 80% of an eligible retiree's healthcare cost, up from the recent 65% and made it easier to capture.

But today, April 30, 2009, Chrysler might declare bankruptcy, with the secured debt holders resisting huge and oppressive government pressure.

Obama's Mantra: Fail, to Win.


Let not Obama leave alone any chance to kill jobs. Oysters. The Obama Food and Drug Administration plans to ban sales of raw oysters harvested from the Gulf of Mexico. Unless, unless they are pasteruized. Yum, the FDA will augment the delicious salt-water flavor with "mild heat, freezing temperatures, high pressure and low-dose gamma radiation. Oh, yes maybe 15 people die each year from oysters. This a $500,000,000 industry that Obama wants to either devastate or garner campaign contributions for not banning sales.  No Jobs Obama is living up to his name. 

And speaking of the FDA, it's looking for more money to inspect plants, set safety standards for fresh produce and additional regulation, including 350 more employees (of course) to increase the size of government during recessionary times.  Get this: the Senate's Health, Education, Labor and Pensions ("HELP") Committee is in charge.  HELP is right!

The Obama Justice Department will try to squelch jobs in the optical-drive industry by launching subpoenas for information from Hitachi Ltd., Toshiba Corp., and Sony Corp., with the Chief Economist of the Federal Trade Commission saying that the FTC is targeting the technology industry -- the only hotbed of innovation other than Obama, Congress and liberal judges -- to "assure economic innovation" and campaign contributions. The FTC also said it had been looking into Intel's marketing practices.

While Obama is stopping oil exploration, drilling and the building of nuclear powerplants in their tracks. The competition is moving in. Repsol YPF SA of Madrid, Spain, has invested deeply over the past decade into oil and gas exploration and is hitting paydirt, while U. S. companies are handcuffed by government domestically. Repsol made a huge new discovery in the Gulf of Mexice adding to its Shenzi field there. Last year it was involved in three of the five largest discoveries in the world. President Obama apparently wants to cripple the energy production in the United States. Why?

This one's great! Obama is doling out $2,300,000,000 to wind turbine producers to create jobs, including $500,000,000 to a dozen wind and solar farm projects. One a 36,000 acre West Texas developed by Shenyang Power Group...and if that sounds like a Chinese name, you are right. Its purchases will create 300 jobs in the United States and 2,500 jobs in China. China jobs with our money. Obama you are insanely stupid.

Understanding they don't want to compete honesty, the American Booksellers Association has asked the Departent of Justice to investigate a greast deal for comnsumer, but who cares about them?  Wal-Mart, Amazon and Target have slashed prices on some upcomin best-sellers, so the ABA is begging for help from Washington DC to put especially union-despised Wal-Mart in its place. Political connection competition.  One would naively think lower prices are good for consumers, who pay less.  But not in Washington DC.

Daniel Tarullo, a Democratic lawyer was appointed by President Obama to come down with a firm hand on banks with his proposed new restrictive guidelines to be carried out by his 2,858-person army of regulators, covering virtually every segment of the financial services industry, probably including break times for executives. It is said Mr. Tarullo has a deep skepticism of banks, banking organizations and financial institutions. He's a micromanaging second-guessor who demands to make every little decision, thus neutering his staff. He's deeply into risk, business models and how the businesses should be managed. Mr. Tarullo taught banking law at Georgtown University and became fast idealogic friends of President Obama, neither with any real-world experience.  Yes interesting how people with no real-world experience think they can manage better....

The Obama Federal Railroad Administration has proposed rules to mandate billions of dollars of new safety hardware costs on railroads to prevent collisions.  The vast spending mandate -- near-term $2,000,000,000 increasing to between $7,000,000,00 and $24,000,000,000 in 20 years -- could lead to cutting passenger-train traffic.  It might prevent accidents that killed 25 commuters in Los Angeles in 2008.  Or might not.  But it will kill jobs.

Then there are jobs then there are jobs.  While the private sector sheds them like snake skin, the federal government is planning, according to the Partnership for Public Service, to add 273,000 -- a 41% increase -- during the rest of Obama's reign.  Each job must be paid for either by a tax on the rest of the country's taxpayers or by borrowing from foreign governments or U. S. citizens.  Government jobs do not create weatlth they destroy wealth.

Uncertainty, as this article from the Wall Street Journal, October 29, 2009, front page A 1 indicates kills jobs.  [http://online.wsj.com/article/SB125659324579108943.html]  "(U)ncertainty created by Washington's bid to reorganize a wide swath of the U. S. economy."  7.2 million jobs have been kiulled since August 2007's start to this recession.

The Obama administration is setting aside 200,000 square miles in Alaska and its coast as "critical habitat" for polar bears that restricts off-shore drilling for oil and gas, thus further diminishing in-country access to USA oil and gas reserves, putting the country further at risk and dependent on foreign sources of energy.  And, of course, diminishes jobs in Alaska and the country as a whole.

Obama's Internal Revenue Service continues its revenge on the successful.  IRS Commissioner Doug Shulman is targeting the very wealthy -- of course those typically-successful people who make the vast majority of the venture and new-business investments in the country -- by "better understanding the entire economic picture of the enterprise controlled by the wealthy individual.  I am sure this very threat will create more job-killing uncertainty in investors. 

New businesses in their first 90 days created 14% of all the hiring in the 15 years from 1993 to 2008. These new business starts tanked to 187,000 over the last year, the lowest since 1995. Jobs? The fewest at 794,000 since 1993.  And the following posts outline the initiatives by President Obama to damage business and kill jobs.

The Obama Food and Drug Administration will start cracking down on cereal logos because his Commissioner Margaret Hamberg thinks some might be misleading.  I don't imaging she'll crack down on hambergers.  What little miniscule business corner isn't under attack by this anti-free-enterprise president?   I guess he thinks jobs are created by Washington DC politicians and bureaucrats.  That's what you learn from Harvard Law School and ACORN.

Obama's Interior Secretary Ken Salazar will investigate oil-shale leases in Colorado and Utah made by the Bush Administration.

Uncertainty incents companies to hold on to their money rather than invest it in creating, for example, new jobs.  Obama advisors are examining the hugest of the huge uncertainties.  Whether to make less financially attractive the ability of corporations to raise money through debt (which is tax-deductable) rather than equity (the sale of stock, which is not tax-deductable).  Mr. President keep killing jobs, after all you have one.  For now.

Private-family investment funds or so-called family offices, of which there might be 1,000 world-wide with assets over $100,000,000 (half of them over $1,000,000,000,000), have been placed in the target of Democrat lawmakers for regulation like hedge funds which raise money publicly.  That should get them to reign in that horrible activity such as investing in venture capital and developing companies.  But not to fear many have banded together to lobby, and in all likelihood, provide members of Congress with additional campaign contributions and the like.  Hiring Jake Seher, a former top aide of Joe Biden and Thomas Quinn, top Democratic fundraiser and good bud of formerly-alive Senator Kennedy for $60,000 a month!  Hmmm.  But as one Democratic representative said, they'd have to obey some rules in order to continue to "play in OUR capital markets".  "OUR" being my emphasis and my wondering if he thinks the capital markets are owned by...politicians ("our"), Democrats ("our") or who.  Free enterprise?  Hmmmm. 

And once again the Obama administration is extending the dependence the United States will have on foreign oil.  His Nuclear Regulatory Commission has rejected the modified design of a next-generation nuclear power station from Westinghouse Electric Co. (a Toshiba Corp. division).  Seven U. S. utilities are seeking licenses to build 14 of them in five states.  Obama's action may well delay planned completions around 2016.  But, hey, who needs cheap, clean nuclear energy when we have bat-killing windmills (more on that later)?  I may be a cynic but Obama's wholly-owned media service, NBC, is owned by the General Electric Company, a manufacturer of nuclear power stations for decades.  Oh, just a coincidence.

And to further hurt businesses large and small and kill jobs, the Obama Labor Department is stepping up union-desired oversight of workplace-safety programs.  Let's see, because of 12 workplace constuction-related deaths on the Las Vegas Strip for 2006 -- 4 a year, compared to 40,000 deaths a year from the common flu.  And some union representatives weren't notified of fatality investigations and couldn't talk to investigators.  A no-no with the Obama Occupational Safety and Health Administration, part of His labor Dept.  It had better hire some more union-represented, Democratic-voting investigators.  No doubt.

A proposed merger?  "No way," says the Obama administration.  "Free market"  (an oxymoron in the U. S.) negotiations between Ticketmaster Entertainment Inc. and Live Nation Inc, are continuing, with no final decision, but the U. S. Justice Department is demanding changes to an agreement not made or they'll sue to block a merger only under discussion.  "Big is Bad", says Obama, except of course for government which is run by omnipotent politicians trolling for campaign contributions.  No doubt.  And surprise, surprise competitors, politicians and "consumer advocates" whatever they really are have complained.  Perhaps Barney Fife could have the combined entity make sub-prime loans to poor people who can't repay in order to have the merger approved.  That always works!

The U. S. banking industry reeling from bad loans and income-killing regulations from the Obama administration and U. S. Congress is facing yet another Congressional attack.  This time on fees banks charge merchants from so-called interchange fees set by Visa Inc. and MasterCard Inc.  Accounting for $45,000,000,000.  Banks have been weakened by government regulations and mandates, and are thought to be politically vulnerable, what with being in some cases forced to take Troubled Asset Recovery Program (TWERP or TARP).  Obama is attmepting to run out all qualified banking managers by slashing executive pay on TARP-takers and "regulating" all other bank exec comp as well as slashing and changing contracts banks have made with consumers about credit cards.  Is anyone wondering when the U. S.-Obama federal government will weaken all banks enough to simply take them all  over and run them as public utilities?  Soon.

Obama's Environmental "Protection" Agency is killing jobs and hurting the domestic refining of oil exacerbating the need to purchase oil from the Middle East and other foreign countries, by objecting to a federal air-permit application of BP PLC to expand its refinery in Whiting, Indiana for $3,800,000,000 (sounds like a lot of jobs).  EPA felt BP doesn't know enough about the "best available techmology and lowest achievable emmissions rate" now, because months ago EPA did give it a permit.  Obama's EPA knows more about technology, of course, than the hated and evil Bush administration.  Obama's job-killing program to continue the U. S. dependence on foreign oil.

Mr. Obama, job openings in August were 2.4 million, down from 2.41 million in July (and off nearly 50% from August 2008!) and were at the lowest level since tracking began by the Labor Department in 2000.  Job separations, quits, retires or laid-offs reached 4.27 million in August with hirings of only 4.01 million -- an historic low.  And all you can do is hurt businesses, as this post proves.  You are sinking the boat you had no hand in building: the prosperity of the United States of America.

Wall Street Journal, October 10 - 11, 2009, page B 1:  "Democrats Weigh Tax On Financial Transactions".  This possibly proposed new tax is "gathering support in high places", labor unions and Democrat legislators especially Rep. Barney Fife (oops, Frank) (D.,umb) especially as a way to finance a new stimulus.  The article also mentions that the concept was slipped into Obama's "stimulus bill" unbeknowst to Congress and in all likelyhood, Obama, none of whom apparently even read it anyway.  It was only $787,000,000,000!  The insertion calls for requiring -- requiring -- the president to submit legislation that pays for any eventual financial shortfall in the Troubled Asset Relief Program (TWERP).

And while we're at it, let's go after IBM for running two Japanese companies out of the mainframe business.  Fujitsu Ltd. and Hitachi Ltd. couldn't take the heat from IBM so they abandoned the business in 2001.  Now mainframes are probably around 20-25% of IBM's revenue and double that percentage in operating profits.  Interestingly 10% the server market, pioneered by micro computers and software, is in mainframes.  A micro computer company, T3T Inc., of Tampa, uses Intel microprocessors and IBM's software for this market.  When IBM refused to license its newest z/OS operating system software to T3T, it sued for antitrust, but the suit was dismissed in New York federal court because it "does not constitute anticompetitive conduct"  So the Obama antitrust administration's Justice Department has, of course, step in over the courts and is launching an "inquiry".  Let's take down to size the longest-lived technology company in America.  At the very least pry some more lobbying money, attorneys fees and campaign contributions out of it.

The Obama Securities and Exchange Commission is investigating again, this time some accounting and disclosure issues for the nation's fifth largest seller (closed sales 2008) and builder/developer of homes.  The industry in general is suffering from overbuilding, high inventories of unsold homes and foreclosures and, of course, the recession and job losses.

The Unites States' 1997 Foreign Corrupt Practices Act hasn't been used much since passage, but the Obama administration has charged a dozen individuals working for corporations with violations.  This virtually unprecedented indictments instead of companies will diminish American companies' appetite for foreign business in part because of the uncertainty and in part because the statutes are confusing and unclear.  And as such can be interpreted arbitrarily.  One exec (founder of Dooney & Bourke) was charged not with doing but knowing his employees might possibly be making illicit payments.  So much for the Rule of Law.   (Please see "The End of the Rule of Law (Part Two)" below.)

Diminishing business is a keynote of President Barack Obama, as this post points out.  Also other posts outline the same intiatives.  Please see "Break Job-killing Union Monopolies and influence".

Montsanto Co. the largest agricultural seed company in the U. S. is targeted by the Obama Justice Department's vendetta against business.  It is scrutinizing "competition" in the U. S. and looking perhaps to overturn an acquisition approved by the George Bush administration, that of Delta & Pine Land Co. in 2007.  Seems big is bad, except when it comes to government.  Yes, Montsanto must be a bad seed!

Consumer credit -- the fuel for consumer spending but also entrepreneurial and small business activity (small firms under 500 employees create two thirds of new jobs and is half the nation's work force) dropped almost 6% in August, 2009, the 7th month in a row, longest since 1991.  Credit card lines alone have plunged some 25%.  So what would No-Jobs-Obama (NJO) do?  Cripple banks with more than fifty comprehensive rules.  It's President Obama's upcoming Consumer Finance "Protection" Act.  Consumer credit is off nearly $120,000,000,000 since July 2008, and lowering it more, of course, will protect consumers from their own base instincts to borrow.  What?  Oh, yes, if they can't have the freedom to borrow, they won't have to worry about the freedom to spend and repay as they wish.  What?  Yes, the president knows better how we should.  Should what?  Should do everything.  And under Democrat Barney Fife (oops, Frank) Chairman of the House Financial Services committee, this proposed new Obama agency will have a Czar who could declare products and services unilaterially "unfair" or "abusive", and force litigation (rejoice trial lawyers) not the much cheaper arbitration.  Czar'd collect fees and essentially dictate how financial institutions and banks do business. 

And you want innovation in the pharmaceutical and medical device industry? You'll have to wait.  Wait until President Barack Obama's anti-business Food and Drug Administration finishes undertaking (an appropriate word) a major review of device approvals under so called 510K, a program that has worked successfully for decades.  Head of the program, Donna-Bea Tillman needs to "get a better lay of the land" and wants all reviews by her subordinates to pass by her.  This in "furthering" of Obama's FDA head, Peggy Hamburg's "new direction" which seems to be both micro-managing and anti-business.  And perhaps those delays will lead to massive new campaign contributions to the Democrats, but that's a bit cynical on my part.  And Obama's mantra of "No New Jobs" continues.

No-Job -Obama's Environmental "Protection" Agency is proposing new rules to force private-sector power plant, factory and oil refining companies to spend vast sums of money for expensive new capabilities to cut carbon-dioxide emissions.

Energy companies which do "mountain top mining" for coal, which blasts hilltops of up to 800 feet, extracts coal, then rebuilds the hills, are now stopped dead by the Barack Obama No-Jobs Environmental "Protection" Agency. In a typical conflict between private enterprise and unelected, but politically powerful special "environmental" anti-business interests, Obama typically comes down on the side of No Jobs. In this case 79 permits are held up, with another 180 waiting, costing according to industry, thousands of jobs. But as a Wall Street Journal points out (Ovtober 8, 2009, page B 1)[online.wsj.com/article/SB10001424052748703298004574459363401191286.html] this move would shift coal production from low-voter Appalchian states to the important mid-west swing vote states of Illinois (hmmm which president is from here?), Indiana and Pennsylvania.  Is that being cynical?

Want jobs, president Obama?  Read a letter from Merrie Spaeth, Dallas, to the editor of the Wall Street Journal, September 29, 2009 (page A 24):  "Businesses are not hiring because we have no idea what next year will be like."   She laments confusion and lack of clarity about taxes and about tax-tinkering every year.

Something like 26% of consumers overspend their checking accounts (and 5% account for 68% of it according to an article in the Seattle Times, "Banks will try to offset lost fees, Spetember 243, 2009, page A 12) and, thus those irresponsible minority are saved once again from the evil banks.  So Congress will dictate how the banks are to price and contract.  Central control of our economy by Democrats.  What will happen?  Banks profits will drop (at a time the federal government wants them to loan money out) and banks will shift their business so as not to lose that revenue.  Thus coinciding with the Democrats' core beliefs the responsible will bail out the irresponsible.  Thank you Obama and Congress!

How best to diminish business?  Cut and control compensation.  And of course, I believe it's just payback time for those who have been more successful than President Obama and his handpicked Democrat regulators ( "jealosy").  And speaking of regulation, Obama wants Kenny Feinberg his pay (Don't call me) Czar to dictate compensation for those pesky bankers who caused the entire world-wide meltdown and recession because of poor comp practices.  Checking rich bankers (including all financial companies at first, all other companies no doubt to come) will cut their tendency to be risky.  But who particularly defines "risk"?  Is being conservative and depending on the government-approved rating agency oligarchy being risky?  What is safe comp for one job?  $100,000?  $535,535? (At least one Obama Energy Dept initiative is "creating" "hundreds of green jobs" for Solyndra Inc. in a planned solar-panel factory by "loaning" it $535,000,000.  I wonder how will it repay the "loan" and that indicates a cost per job of $535,535 (for 999 jobs) to $2,675,000 (for 200) jobs depending on the definition of "hundreds".) $2,675,000 or simply $1,000,000?  But was it comp or simply the government's allowing, no promoting, vast leverage with which the banks could operate?  So, is Kenny going to sort out all of these issues and make the decisions, or will it be Obama, or his hand-picked Democrat elite?  Stay tuned.

The Obama administration is trying for all-encompassing curbs -- rather dictates -- on compensation for financial institutions.  The final proposal is a month or so away, but let the lobbying begin.  Campaign coffers fill!

Obama's new crop of regulators are doing what they can to hold down the growth and progress of business.  Yes, new rules on proposed business mergers will change how the new anti-business government regulates formerly free-enterprise mergers.  Now, my guess: how the regulators like the companies and other empathetic stuff.  Specific rules by which businesses can manage, not so much, but we'll see.

And yes, who better than to regulate business than a union boss guy?  But new Obama "senior counselor for manufacturing ("Don't call me Czar"!) Ron Bloom said he "won't dictate how much a factory should produce or the types of products it should make..." Whew.  Well except for whatever "green industries" might be.  But Obama lost his "green jobs" (Don't call me) Czar, former White House environmental adviser Van Jones, who called himself a Communist, has left the building.

But in the face of competition from abroad and anti-business activity in Washington DC, a little article about Farouk Systems, Inc. in the Wall Street Journal (August 24, 2009, page B1, "Coming Home: Appliance Maker Drops China to Produce in Texas") brings a little hope. The company, an entrepreneural creation of Palestinian-born hairdresser, Farouk Shami, sells $1,000,000,000 of hair irons and other hand-held appliances. He is moving production out of China to improve quality and image and better control inventory. Mr. Obama, back off. Let the free market grow and prosper and create jobs without burdensome regulation and unionization....

Dang! I have been updating this post for six months, and on August 31, somehow I deleted it all. So I am starting anew. In summary this post will describe instances where President Obama and his administration do things that hurt businesses and thus either reduce some jobs that businesses have created or diminish the possibility of businesses growing and producing new jobs. Simple. It outlines the tension between the president's pronouncements of "creating or saving 750,000 jobs" from the $787,000,000,000 "stimulus" and protecting the very entities that financed his election, which generally are anti-business, such as labor unions, trial lawyers and environmental activists, among others.

Obama's Labor Secretary is proposing to increase pay and enhance "protections" of seasonal farm workers. And a national electronic job agency to help farmers find U. S. workers, and for employers to prove they're looking for U. S. workers. Central control and command of farms, maybe? As typical unions love this and the actual owners of the farm businesses and the actualy employers of workers are against. Obama tried another anti-farm move earlier this year but it was struck down (FDR-like) in feceral district court. Mr. President, get rid of that judge!

The Obama Securities and Exchange Commission will give its attorneys even more authority and power to speed up new investigations of corporations. The SEC's challenge to business has opened 10% more investigations, granted 118% more formal orders, filed 147% mnore temporary restraining orders and filed 30% more cases, but who's counting? This in an effort to gain or retain 750,000 jobs in 2009! Huh?

And speaking of the "stimulus" apparently "only" about $88,000,000,000 has been spend by the first week in September, most on aid to struggling states, and aid and social programs which certainly do not support business, the only creator of lasting jobs and wealth. The only portion that might remotely help is the laughably-low $8 (eight dollars) a week tax credit to workers. And of course the entire $88,000,000,000 has had to be borrowed. While this didn't diminish business, it clearly didn't create jobs: (September 3, 2009)WASHINGTON (AP) -- The unemployment rate rose to 9.7 percent in August, the highest since June 1983, as employers eliminated a net total of 216,000 jobs; since Mr. Obama and Mr. Biden took office, the economy has shed 3 million jobs.

September 1, 2009, Erick at RedState.com [Erick.Erickson@RedState.com]: "Barack Obama Sneaks Through "Union Only" Order Shutting 8 in 10 Construction Workers Out of Federal Projects. There has not been a lot of coverage of this. It happened back in July and is only now winding its way through the federal system. Barack Obama and his administration are about to significantly drive up the costs of federal building construction. This is an astonishing reach. The Office of Management and Budget has directed that any federal construction over $25 million benefit unions. The order would make all federal construction projects 10-20% more expensive by requiring all contractors to either use union workers or apply inefficient union apprenticeship and work rules to their employees. Contractors would also be required to make contributions to union pension funds and other union programs that non-union workers will never benefit from.

This will hugely drive up the cost of construction of federal buildings and line the pockets of unions without even having union workers involved in the projects. The Bureau of Labor Statistics shows that only 15.6% of private construction workers in America belong to unions. In other words, 8 out of 10 construction workers in America will be legally denied the right to work on federal building projects.

This is appalling."

Great news in the midst of a recession, right?

ObamaCare: Medicare Gone Wild. Or anti-health "care"

Speaker Pelosi rammed narrowly through the U. S. House of Representatives the nearly-2,000 page document she calls healthcare reform.  Please see my post "The End of the Rule of Law (Part two)" which outlines some of the complexity of her bill.    The Speaker traded, excoriated, bribed, threatened her fellow Representatives in her quest to win.  And she squeaked out a bill with one Republican bribed with higher Medicaid payments to his state of Louisana and a deal on abortion.  The Senate is the next challenge.  And a big one at that.

The Congressional Budget Office today (October 8, 2009) "scored" the latest iteration of whatever the Democrats are trying to push onto America in their takeover of  the entire healthcare industry.  Whatever they come up with will ultimately bankrupt this country, so pray for nothing important.  And interestingly enought the Senate Finance Committee proposal will "cost" (courtesy of CBO before footnotes) $829,000,000,00 and cut the deficit by $81,000,000,000, in part by pushing some expense onto states, except of course the states of powerful Democrats: Nevada gets a five-year exemption; New York, Massachusetts and a bunch of other Democrat-controlled states get special treatment for unions; in  corrupt and Democrat-controlled New Jersey, its pharmaceutical companies will get a $1,000,000,000 special tax credit; Democratic-controlled Massachusetts (again, courtesy of failed Democratic presidental candidate John "Heinz" Kerry) and Michigan get $5,000,000,000 in special union reinsurance

Latest news for senior citizens from the president who promised their healthcare will not change one iota, except for the $124,000,000 taken from Medicare Advantage which covers 25% of us, it will be killed.  Except for $400,000,000 slashed from regular Medicare to pay for Medicaid and new tax subsidies to help others purchase health insurance mandated by Congress.

This political dispute is no longer about healthcare it's about egos and "political will". And it seems Rahm Emanual is losing, and it's been said he doesn't lose easily. Even after a full-court press of lobbying by Emanual's mouthpiece, President Obama, he's falling. Even Democrats are challenging him. From the left on the "necessary" government monoploy and on the right, from "Blue Dogs" not wanting a government takeover. Quandry. And their nemesis, Citizen Sarah Palin scored with the "Death Panels". But Emanual is not to be outdone. With focus groups and polling no doubt he'll rebrand "death panel" to be "Life Panels". Now isn't it better?

Senate Finance Committee Chairman Max Baucus, a Democrat, wants to tax young, healthy people who might not want to buy health insurance somewhere between $3,800 or $1,900 depending on where he is today on votes.  Chairman Max' bill was endorsed by...him and only him.  Now every Democrat in DC is scrambling to buy enough votes to have some bill passed, and start the absolute control of all healthcare in the U. S. by Democrats.  "But don't call it a tax" said, President Obama in one of his myriad appearances on the left-wing media.  A tax by another name is a "penalty" or "mandate" or "something" but not a tax.

Democrats want to pay for its new monopoly over healthcare by slashing Medicare payments by $500,000,000,000 while baby boomers turn 65 and increase Medicare enrollment by 30%.

Tennessee tried in 1994 an ambitious healthcare reform including universal coverage and public option. [Wall Street Journal, Monday, August 17, 2009, page A 2. http://online.wsj.com/article/SB125026043441032205.html] Result: It almost ate Tennessee for lunch, capturing one-third of its budget it was so costly. Initially set at $2,600,000,000 to cover poor people and those who were rejected by insurance companies, it hit $8,500,000,000 by 2004. People covered by their employers insurance went for TennCare instead, 1.4 million people leaving only 6% uncovered (because of an income cap). Tennessee started backtracking, cutting those covered and slashing reimbursement, driving many providers from the program. Initial "cost savings" to pay for it initially succeeded by reducing visits to emergency departments. But that didn't last, by 2005 TennCare threatened Tennessee's very solvency. It reduced participants and leveled out the losses, to $7,660,000,000 covering 1,280,000 people. Many not covered have CoverTN which pays basic medications and tests for $125 a month with a maximum of $25,000 a year. Diagnosis: Failure.

Why should we want to extend a failing U. S. Government program? Medicare is one. It is losing money. MEDPAC -- the Medicare Payment Advisory Commission -- reports that hospitals lose 5.9% for every dollar they receive treating Medicare patients (getting back only 94.1% of costs). Privately-managed health insurance companies treating non-Medicare patients SUBSIDIZE Medicare. Regardless, in the four years from January 2003 to December 2007, Medicare trustees reported that the unfunded liabilities of Social Security and Medicare grew by a stunning $10.4 trillion. The average annual growth was $2.8 trillion. According to the Medicare Trustees “intermediate assumptions,” $38 trillion (260% of current GDP) would have been needed at year-end 2008 to fund over the next 75 years projected shortfalls for Medicare hospital coverage and to meet the federal government’s statutory obligation to pay its share of other Medicare benefits, including prescription drug coverage. And at 2016 or 2017 -- 7 or 8 years -- at today's calculations the "trust fund" will run out. ZERO. So money will come from everyone's taxes to pay for the burgeoning numbers of seniors. And they don't die fast enough (only about 5% of them a year) to get off the roles. Hey government, great management. And let's see something live 42 million people are now covered by Medicare, around the number President Obama wants to add to his government-run, single-payer system. Go Obama!

If Obama really cared about reining in the out-of-control healthcare costs, he'd:

1) Allow a tax deduction for individuals' health insurance premiums so they can shop where they choose for a policy that fits each of them and take payments for health insurance from companies by stopping tax deductions for them. Freedom in capitalism.

2) Rein in trial lawyers who force expensive medical settlements for accidents by healthcare providers which a) finance their yachts and jets and b) drive up costs and c) force these providers to defend against frivolous law suits by ordering more tests, scans and diagnostics than would be otherwise necessary. Actual negligence should be handled by a special healthcare court system, much like that for bankruptcies, instead of expensive adversarial conflicts. A lot cheaper than buying yachts and jets, and facts would predominate, not a lawyer's ability to persuade.

3) Cut coverage mandates dictated by politicians which pander to a voting bloc lobbyist or grab campaign contributions and include: hair implants, chiropractic, speech therapy, podriaty, vision, massage, marriage counseling, substance abuse, infertility, erectile disfunction, and equality of mental with physical health. (In 1965 there were a small handful of these politician-directed mandated coverages, now there are upwards of 1,000.)

4) Allow cross state-border marketing of health insurance plans, with the consumer being allowed to choose.

5) Allow clinics to be established in retail locations, like Wal-Mart and encourage entrepreneurs to establish them and hospitals for specialties; yes, it might force some hospitals out of business, but in exchange for more efficiency and effectiveness.

There's a start Mr. President, to lowering the price of healthcare. There'll be more here coming.

www.whitehouse.gov/realitycheck ("reality check" being a segment on the O'Reilly Factor, television news' number one show), paid for by taxpayers is our president's attempt to bully his fellow citizens into accepting his left-wing attempt at taking over American healthcare. He is using his powerful seat to shut-up dissent and silence anyone disagreeing with him, saying he knows what's best for the American people who'll "be glad that we [meaning 'I'] acted to change an unstustainable system" that government created initially. Yessuh, yessuh, master you know best.

The United States of America spends $2,400,000,000,000 on healthcare, slightly more than the entire GDP of the United Kingdom (the world's sixth largest). Government mandated and managed Medicare has contributed greatly to this vast spending. So certainly covering another 25 or 50 million people under the same management will cut costs. What are you snorting this time, Barack?

Just an interesting factual tidbit. 5% of Medicare beneficiaries die each year and spending during the last year of each life accounts for 27.4% of all Medicare spending. (As of the latest comprehensive report in 2001.)

Not that it matters, since this has nothing to do with facts, only with the mad grasp for power, but France -- the epitomy of Obama's dream society -- is pushing back against out-of-control spending on its Assurance Maladie single-government payer health insurance. Adopting American techniques like co-pay and bringing in business managers to rationalize government workers' hours and cut jobs. No matter where Obama wants to take America isn't working in France. Costs there and in the UK are rising as in the U. S. "Obama-lite" former Republican governor Mitt Romney's experiment in universal coverage was supposed to cost $472,000,000 last year but hit $628,000,000! A failure. The only way to rein in healthcare costs is to rein in healthcare costs. Cosmetic surgery, dentistry and laser eye surgery all are free-market and not paid by most insurance. Result? Better technology and lower or the same prices over time. Proof only to rational not left-wing ideologic people. We should give the free market a try.

Just to put things in perspective, since President Obama asked gently to "overhaul" the healthcare industry in America, and turned over the natty, irrelevant details to Congress, lobbying has intensified to $133,000,000 in the second quarter alone.

From the party that wants to own your healthcare (WSJ, July 22, 2009, page A 6):[Democratic-controlled] New York City, State to Pay $540 Million in probe of Medicaid Charges, that they knowingly submitted false claims to Medicaid. This is the largest ever recovered settlement, and covered 1990 through 2001.

From the New York Times, June 12, 2009 page A 15, "Obama takes his health care case to the public", Obama said: "If the private insurance companies have to compete with a public option, it will keep them honest..." Thus Obama let slip out that he believes insurance companies are not honest. And later, he said, "We've got to admit that the free market has not worked perfectly when it comes to health care." Oh, yes like Medicare and Medicaid!

But if Congress and the president really had our best interests in mind, and weren't simply lusting for more power, they'd stop, look and analyze the results of Massachusetts' 2006 healthcare plan. See a Wall Street Journal article (July 11-12, 2009, page A 10) http://online.wsj.com/article/SB124726287099225209.html.

And it looks like Obama is cloning the first President Bush's "read my lips, no new taxes" by moderating the possibility of taxing healthcare benefits and setting up Congress, especially Republicans, to take the blame. (As in, "the Devil made me do it".) Obama in part beat McCain in the 2008 election by pledging, promising and guaranteeding that no one making under either $250,000 or sometimes $200,000 would have a penny of their taxes raised. (Unless they smoke.)

The headline Friday, June 19, 2009: Senator Edward Kennedy's healthcare bill specifically (section 3116) exempts members of Congress. Doesn't that and that alone tell you something? Oh, federal employees won't be in it either, same section.

Senator Ron Wyden, Democrat from Oregon has a better idea than either Senator Kennedy or President Obama who simply want to take over American healthcare, facts and markets notwithstanding. It is obvious they don't to hear any other sides. But read here:

http://online.wsj.com/article/SB124545885464333145.html. If you care about the upcoming healthcare clusterfxxk read this article carefully.

And Safeway has used a market-based approach to make its non-union employees more healthy and keep their healthcare costs flat. An important strategy that our politicians will not read. Don't bother the Democrats with facts...
http://online.wsj.com/article/SB124536722522229323.html and http://online.wsj.com/article/SB124476804026308603.html

Now to the rest of the story:
Stop smoking, save 475, 000 lives.
Lower blood pressure, save 395,000 lives.
Slim down, save 215,000 lives: 31% of us are clinically obese with a Body Mass Index over 30.  3.8 million Americans are over 300 pounds and 400,000 are over 400.  The cost of diabetes alone is $200,000,000,000.

All together healthier living could save 1,250,000 lives a year. Cost? Not much, just a little self-discipline. This includes less alcohol (boo) and more fish (yea).

Universal health insurance might save 18,000 lives. And funny thing, Obama's doctor said that government, single-payer healthcare is his preferred choice, but the "scoring" by the Congressional Budget Office indicated that 16 million more people would be covered for sums between $1,000,000,000,000 and $1,500,000,000,000, leaving Obama some 29 PEOPLE million short of "universal".

Akrasia, the Greeks call it, weakness of will. But in America, our government would rather spend $1,200,000,000,000 to $1,500,00,000,00 instead of challenging voters to do something they might rather not do. Our country is self-indulgent thanks to our spineless politicians thirsting after cushy jobs afraid to tell people to "Knock it off." (Remember Medicare has $38,000,000,000,000 in unfunded liabilities! With increases in costs 34% HIGHER than the rest of healthcare snce 1970.)

Education not regulation, but some taxation (it worked beautifully on cigarettes, only sorry much of that dough went to buy trial lawyers their new jets) and pricing insurance on life styles, and rejiggering incentives. Today providers of healthcare get paid for doing things. If people paid their own healthcare costs, and prices were higher to smoke and be fat, many would stop and exercise. Pretty simple and cheap. But no, Obama and his Stepford Congress wouldn't get more power over other peoples' lives, so "no" to that simple, cheap solution. So let's go and spend $1,200,000,000,000 to $1,500,000,00,00 instead. And to pay for it, let's laugh off Obama's "savings", he must be back on cocaine to believe that. But he is asking for us -- taxpayers -- to believe in his no-detail savings plan, "Oh, sure, politician we believe you." His real answer, tax. Tax. Tax. Everything. Employer-sponsered health-care plans (no matter he destroyed Senator McCain for saying the same thing.) Non-profit hospitals which don't give away enough care. Alcohol. Limit Health Savings Accounts, or just eliminate them because rich people might get something. More tax on beer and wine. Sugary beverages, including pop, fruit juices, iced tea, sports drinks, flavored milk. Maybe not water.

But one way Democrats will save a little of that obscene expense is by...RATIONING healthcare based not on doctors' opinions but those of bureaucrats. These shamans of healthcare -- bureaucrats -- now will not pay for "virtual colonoscopies" computed tomography (CT) scans of the colon because of cost. Cancer death #2 in the U. S.! Cure rate: over 90% if diagnosed early; 8% -- certain death -- later on. My guess is that Congress will pass a law (after some pressure, and after some campaign contributions) to force Medicare to cover these potential life-saving scans. That is the preview of ObamaCare...healthcare by campaign contribution. Or: "Pay or Die." But it'll be up to bureaucrats thus breaking the sacred bond of doctor and patient dating from Hippocrates. Like all else Democrat, everyone is equal (except the political royalty) and so computers and bureaucrats can make the diagnosis and perform the therapy.

A couple of interesting articles from the Wall Street Journal:
http://online.wsj.com/article/SB123681586452302125.html, The Wall Street Journal, Thursday, March 12, 2009, page A15: "Obama's $80 Billion Exaggeration".

http://online.wsj.com/article/SB123682034697503187.html, The Wall Street Journal, Thursday, March 12, 2009, page B4,

But of course President Obama and Congress will not do anything that does not expand their power over others, does not prove capitalism and free-enterprise wrong, and does not attract campaign contributions. So what will ObamaCare do, for example, to doctors? "How ObamaCare Will Affect Your Doctor" (WSJ May 12, 2009, page A 17. http://online.wsj.com/article/SB124208383695408513.html). Now Medicare on average pays physicians 20% - 30% less than private plans because of its price and wage controls. When many more patients are covered, and companies will offload their workers like mad from private plans to the government, costs will be impacted by cutting doctors' pay another projected 15% - 20%, with lower-paid primary care physicians hurt most, at the same time they'll be required to purchase costly information systems. Remember that doctors are in the higher-income levels, so their taxes at the same time will be greatly increased. And their diagnostic and therapeutic time will be cut by paperwork. Obama, of course, sees his bureaucracy as better equipped with computer-driven expert systems being better able to diagnose and care in a cost-effective manner. But will it hire and employ physicians and other providers and have them join unions? This hasn't been discussed, but why not?

None of this makes sense.

But hey, how about this: Obama's pick for Health and Human Services secretary--Kansas Gov. Kathleen Sebelius used to work as the chief lobbyist for her state's trial lawyers association.  Malpractice awards are $20,000,000,000 to $40,000,000,000 a year (laywers typically get 30% to 40% of it).  But fear of lawsuits is where the cost of "defensive medicine" skyrockets: studies indicate $100,000,000,000 to $178,000,000,000 a year tops, $66,000,000,000 at a minimum.

Incentives of Medicare are to treat, to do things to get paid. Providers don't get paid if their patients are healthy and get healthier. This is the definition of perverse incentives.

But for the Democrats how is ObamaCare doing so far? Quite well, thank you very much. Drug makers have increased their favor-currying (lobbying) to $47.4 million the first quarter. Ditto, hospital organizations, insurance companies, doctors and labor unions.

Republicans have a better plan, but it won't get off the ground because it relies on the private sector. People become responsible for their care. They get money now given in tax credits to their employers. (Which by itself -- a third-party, detached payor -- increases useage and costs.) Republicans will mandate health insurance to be sold across state lines but leave it up to the private-sector companies to define coverages and premiums.

But Democrats see its 45-year Senator from Massachusetts, brain injured far left-winger Edward Kennedy as its key. While Kennedy can't make it into DC, his ethically-challenged friend Christopher Dodd (D., Conn.) will be his mouthpiece. Would the senator from Massachusetts like his obviously "extraordinary" care rationed because it's too expensive. NO! And a question is, exactly who is paying for his healthcare? Medicare?

But wait! There seem to be two roadblocks to a smooth transition to government healthcare. First, they have to figure out how to pay for it. Apparently rich people don't have enough money. And President Obama has promised...promised...("cross my heart hope to die...") that any plan won't increase the budget deficit. Well, dude, what about the $1,200,000,000 to $1,500,000,000 it'll cost? Second, whether they'll create a new public health-insurance plan to compete with private plans. Let's see now. Obama and most of the Democratic Congress believe the free-enterprise system doesn't work. Look at the U. S. Postal Service and Amtrak, for example. So this is a no-brainer for the anti-business morons running our country.

And one might ask, how's medicare doing? according to revised government estimates, not well. Its fund for hospital care will run out of money in 2017, (two years earlier than last year's estimate. [Social Security, too, will run out in 2037, four years earlier than last year's estimate!]

Our president's Council of Economic Advisors released a report, "The Economic case for Health Care Reform," June 1, 2009. It outlines five issues. 1) Federal deficits undermine this country's stability and healthcare must be "reformed" to cut deficits. Obama's plan is to borrow $1,200,000,000,00 to $1,500,00,000 to fund losses while government takes the healthcare industry over. Check the U. S. Post Office and Amtrak to see how government'll slash deficits by taking over arguably the largest industry in the world (perhaps next to government). 2) "Skyrocketing costs" are not, as it indicates, skyrocketing falling to a 6% increase in 2007 against 13%, for example, in 1980. It might be highlighted that costs started heading up fast when Medicare was passed. 3) Families are burdened by healthcare costs. Not as much as the Democrats want you to believe. Food and energy have decreased and housing has stayed flat as a percentage of households' incomes, indicating that healthcare is not increasing its burden and forcing families to give things up for healthcare. Americans can afford more healthcare spending because as a nation we are richer than others. 4) We should copy Europe. But no. Much of the increase in U. S. healthcare spending comes from innovation in high-tech equipment and medications. Almost all of which is financed by the U. S. in the U. S. Our diagnostics are better. As is our healthcare. We have little waiting for diagnosis and treatment, unlike Canada and Europe. We could go back to the 1980's and have 60% survival rates from heart attack instead of today's 90+% 5) CEA advises shrinking healthcare industry spending by 1.5% a year, thus creating higher unemployment and concomitant lost wealth and higher costs from the 1.4 million jobs in healthcare now. And cutting money going into the industry will shrink the number of providers thus guaranteeing long waits for healthcare and steadily increasing deaths. The untold story of ObamaCare!

And an aside, speaking of Canada. Need an MRI? Wait: one year. Then, surgery needed? More months wait. Need ER? Only half the patients are treated on a timely basis. Now the trends are: head to America for healthcare; or go to a private, non-governmental clinic, 50,000 in Vancouver BC and growing quickly. It's getting to be, the rich get good care.

An example of "rationing" NOW in the U.S. is Centers for Medicare and Medicaid Services (CMS) overseer of Medicare and Medicaid for the Dempartment of Health and Human Services, refusing to pay for virtual colonoscopies, a less-invasive procedure for colon cancer detection. And of making the rules for home oxygen therapy so complex that they seem to hope patients will give up and die. Only two quick examples. But the way CMS "cut" healthcare is to take away compensation for doctors, nurses and other providers. And you ain't seen nothing yet!