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Obama’s Post American World

I dearly wish that our political celebrities would combine their observations with insight and season them liberally with understanding.  I also wish that they would learn the lessons of history so they would be less inclined to repeat past mistakes.

Maybe we should think about our communication style with these people.  Could we pattern our approach with the insight and understanding of where they came from and how they grew up?  How can we make the national defense issue “up close and personal” to a people who are more prone to run away from responsibility than face it squarely and deal with it effectively?  An attitude adjustment requires disposition.  How do we help lawmakers and US voters become disposed to listen and be open to ideas that are different from their own?

Allan West recently published the following comment in an Internet piece:

Forty years ago, 72% of the House of Representatives and 78% of the Senate was made up of lawmakers who served in the armed forces. Today just 20% of House members and 18% of Senators have served. Those who have served in the military have a better understanding and a deeper comprehension of issues involving national security, armed services and veteran issues – issues that if not more important now, are just as critical as they were 40 years ago.

“When I served in Congress from 2011-2012, I was one of only four black Republicans to serve in the United States House of Representatives in nearly a century. In the Senate, there have been only two. As the demographics of the U.S. population shift, it becomes ever more critical to increase representation by not only black, but Hispanic and Asian American leaders as well.”

My Own Observation

“40 years ago” equates to the 1960s, or about 20 years or so after WW-II.  I remember that we had mandatory military service (the Draft Law) in the 1950s.  This also was about the timeframe that the news media started branding people with names like “Hippies”, “Yuppies”, “Flower Children”, and “Generation-X” just to name a few.  Their parents were labeled “baby boomers.”  Our nation was in a turmoil of clashing value systems and ideological rebellion.  No wonder the US House and Senate was packed with Military veterans back in that day.  That also might explain why many present US politicians in office now are allergic to anything military.  Those “60 something children” grew up.

Occasionally, I tune in to BBC’s airing of the British Parliament.  The Speaker faces a large aisle that ends with the door to the room.  Members face each other, not the Speaker (who seldom speaks).  The Labor Party and socialists sit to the Speaker’s left and the Conservatives sit on the Speaker’s right.  The members address their remarks to the Speaker about the misdeeds and ideological faults of the members across the aisle instead of their opponents.  The Speaker is the referee of a verbal warfare called a “debate.”

The US Chambers of both houses also have a Speaker facing a much narrower aisle.  Unlike the British Parliament, the Conservatives sit on the left side of the aisle and the so-called “Liberals” sit on the right.  The members face the speaker, not each other.  At one time, the conservatives were liberals over the issue of slavery.  The Democrats supported slavery.  The word “liberal” originally was a brand name for a change agent.  I no longer know what the word “liberal” means because both sides of the aisle seem to be change agents for opposite causes.

Should the Republicans and Democrats switch sides?  I do not think so, especially if we revert the definition of the word “liberal” back to its original meaning.  The Republicans basically respect their oath of office and want to pattern the present government on the mandates outlined in the US Constitution.  They want to restore the three-leg stool that supports the US Constitution:

  1. Separation of power,
  2. Balance of power, and
  3. Limitations of Power.

They argue that the US Government is NOT a democracy now, and never was.  Instead, it is a representative republic bound by a confederation of member States.

On the other hand, the Democrats consider the US Constitution an obsolete document urgently in need of revision or outright replacement.  Meanwhile, they ignore its original concepts and substitute an informal replacement that they call their “living constitution.”  They advocate a parliamentarian republic modeled after Canada and the European nations.

Their principles and foundation are reflected in the Obama campaign flag that he wanted to fly in all government buildings in 2010 instead of the official American flag we use today to identify ourselves to the rest of the planet.

This is a variation of the campaign logo, represented by the blue and white symbol in the upper left corner. The three curved blue stripes represent Canada, the (about to be former) United States and Mexico.  The rising sun represents the future America with three provinces.  The outer circle represents a one-world government.  As Obama said, “There are no States but the United States.”  His vision involves the dissolution of a confederation of States.  Are those red stripes blood?     If so, whose blood?

My source for its symbolism is The Post American World.  This book was in the President’s hand as he prepared to board the Presidential Helicopter in 2009.


Posted in Politics | Leave a comment

US Economics and Finance through (fictional) Foreign Eyes

Tags: debt, FED, jobs, economics, finance, deficit, dollars

Thank you for coming to this meeting on such short notice. We are especially grateful to Fu Ling U from China and Schneider Von Dipstick from Germany for their long journey here.

First, it is difficult to wrap our minds around the hugeness of the US dollar numbers we are dealing with. Perhaps this example will give you a feel for the size of our problem. If you could spend $1,000 US dollars per second, 24 hours per day, continuously without pause, it would take you 31 years and 8 months to spend just one trillion US dollars.

We government economists, trading partners and international bankers are “on to the USA” about their financial policies. We know that their nation owes more debt to foreign creditors than the rest of the debtor nations combined, or about 60 percent of all debt on this planet. This includes the P.I.G.S. (Portugal, Ireland, Greece, Spain) and now Italy. France is on the waiting list.  We also realize that their US Government is committed to future payments of about $115 trillion in entitlements that are not actuarially sound.

We observe with greatest concern that their Government insists on over-spending their income by anywhere from 42% to 48%, depending on who we ask. Their Federal Reserve is buying over $60 billion worthless securities from Fannie Mae and Freddy Mac per month.  That is quantitative easing on steroids.  Perhaps that explains why their outgoing Chair of the FED is nicknamed “Helicopter Ben.”  Their Bureau of Statistics (BS) claims that unemployment is 7.2 percent.  Gallup reports that it is actually somewhere north of 31 percent when one considers the decline in the size of their work force. In the face of that reality, the US government remains unwilling to balance its budget or spend within its means.

We also notice that most of their member States also are in serious economic trouble for similar reasons. Their financial troubles are at least partially induced by unfunded federal mandates forced upon the member States by their central government.

In other words, the US Government is borrowing more money to cover almost half of their current operating expenses. We also notice that their Federal Reserve central bank, nicknamed the FED, increased its holdings of US debt obligations  by about $1 trillion in 2013 alone. This action expands the domestic money supply unless foreign banks absorb this by increasing their reserve currency holdings. As a result, the interest payments on their national debt are eating into more and more US Government revenue with no end in sight and leaving progressively less money to pay for operating expenses and debt retirement. When “Helicopter Ben” defined “quantitative easing #3″ as an indefinite monthly purchase agreement, that remark went over like a loose female skunk in the international space station everywhere except the United States.

The FED is using its monetary policy tools to keep interest rates low, but that cannot last much longer. As US Treasuries mature, foreign governments are going to demand higher interest rates to roll over their debt holdings as they retire. This creates a problem for us because we exchange US Treasuries with US cash that we somehow have to get rid of.  It also creates a problem for them because debt service consumes an ever larger portion of their operating revenue.  How can we do that?

Foreign banks and foreign-owned corporations with balance of payments surpluses are re-evaluating the usefulness of the US dollar as the favored reserve currency for international trade. This is important because foreign banks and corporations collectively hold trillions of US dollars in their accounts and the US pays no interest on that money. International banks also have a problem of their own. If they use another reserve currency instead of US dollars, how do they get rid of their US dollars?

If they become harder to exchange, they get discounted in value, thereby causing monetary inflation through devaluation. If the financial herd starts a stampede, the dollar becomes worthless because there is no commodity to back its value in international commerce. The only way that these entities can collectively reduce their holdings is to buy something of commodity value from the United States. Their US currency has not been backed by anything of value since 1965 when the silver certificate became a Federal Reserve Note, called “fiat money.” Therefore, the FED is only obligated to trade one dollar bill for another dollar bill. So what can we buy from the USA with their dollars?

Their trading partners are going to demand higher prices for imported goods. If we can move our dollar balance to some other trading partner by buying stuff from them with US dollars, we will do so as long as we can. We also will invest in ownership of US corporations, buy more of their country’s natural resources, farmland, mineral rights, and anything else of tangible value they own to get rid of our US dollars. This is already happening. If this continues, we will own their capital stock and they will be working for us. Instead of US corporate profits fueling their economic engine, it will sap their strength and fuel ours. Instead of being a member of the International Monetary Fund (IMF) the USA may become its largest client. If US Big Labor tries to mess with our manufacturers on their soil, we go somewhere else and take their jobs with us. If the unions get personal, we know how to let their threats fall on their own heads. Eventually, their soup kitchens run out of ingredients and cannot buy more. See Haiti for what happens next.

Their only practical way out of this financial snake pit is to make things, flow stuff, mine stuff and grow things we foreign creditors want to buy for more money than it costs them to produce and deliver. However, the US has de-industrialized itself, so they have lost most of their manufacturing infrastructure to ours. That action created their balance of payments deficit with us because US corporations were over-taxed, over-regulated, and milked dry by Big Labor. They could not compete in the international marketplace. Their only survival option was to move their manufacturing jobs offshore to stop the bleeding. Their largest export is paper. Most of it is used to make packaging material for products made in China.  If US citizens try to find a US made product that they need, they have to look very hard to find it.

But the US work force is the most productive in the world, right? Then how can we make a profit on a product we can manufacture and ship to their door at a price below their cost of manufacture? There is something wrong with this scene.

Their US Government continues to over-spend its income with no end in sight. The deadlocked Administration and Senate vs. the US Congress shows no sign of any financial remedy to their financial crisis. The US Treasurer does not control fiscal policy; he pays the bills with the money he has available and must borrow the rest, thereby increasing their National Debt. Their Federal Reserve central bank, unknown to most of their electorate, is forced by its charter to become the lender of last resort. In other words, the FED MUST BUY DEBT that the US Government cannot sell to pay its bills. It may elect to buy debt to keep interest rates low, but tax everyone’s savings and sap everyone’s purchasing power with monetary inflation that inevitably follows that action. That includes our US dollar holdings.

Their political leaders say, “But we need to spend stimulus money to create jobs that put money into people’s pockets so they can buy stuff from employers to create jobs. Right?” Not if it has a label that says, “Made in China”, “German Engineering”, ”Made in Japan”, “Made in S. Korea”, “Product of Mexico”, “Product of Chile”, etc. Perhaps that is why their stimulus money does not create jobs. The only way I know of to raise a stagnant economy out of recession is through their own PRIVATE SECTOR INVESTMENT.

Government cannot buy prosperity. It can buy poverty. When will their electorate and leaders realize that simple fact? Now I look forward to your questions and suggestions.

Tags: debt, FED, jobs, economics, finance, deficit, dollars

Posted in Economy | 1 Comment

Oil Industry Primer for Newbies Updated

Tags: oil, Bakken, Williston, energy, investment, tax shelter

Oil does not come out of the ground ready to use and is not anything close to a standard commodity like gold. If a large portion of its mixture can make gasoline and diesel fuel, it is called “light.” If it is free of contaminants like sulfur, it is called “sweet.” The heavy stuff that requires heat to make it liquid is called by several names (some not printable), but the commonly used labels are “paraffin” if pure, and “tar” if not pure. The reservoir contents that contain this stuff are called “tar sands.” The crews that operate drilling rigs are called “roughnecks.” Their work is long, hard and dangerous.

Oil reserves are not the same:

Proven” means the reservoir is in production mode, fully mapped, and its size and permeability is established. In other words, oil producers know how much is down there, where it is distributed, and how much of it can be retrieved with today’s technology at an affordable cost.

Known” means that the existence of oil in the reservoir is known, the reservoir’s size is known, but it is not yet developed beyond exploratory drilling.

Potential” means that geological surveying identified reservoirs that MAY contain oil, but no exploratory drilling has determined what is actually down there. Nine out of ten times, it contains salt water “oilman’s poison” or non-fuel-bearing gas called “a dry hole.” When oil companies hype about the total reserves, one must smile politely and take their statement with suspicion. Troublemakers ask for a breakdown by category.

The contents of oil reservoirs are different. Most of them are full of sand surrounded by oil, called “oil sands.” Some sands are gravely and highly permeable.  Others are fine and dense.  Others, like the Bakken, consist of shale rock with oil trapped inside. It must be fractured to release its oil.  Oil reservoirs are fed by huge deposits beneath them called “basins.”  For example, the Bakken formations are fed by the Williston Basin.   Oil reservoirs have a gas cap to provide the pressure needed to get the oil to the surface. Like soda, the gas separates when the pressure is reduced.

Oil Recovery

Primary oil recovery involves a pipe called “casing” from wellhead to the reservoir.  Actually it consists of pipes within pipes of different lengths, each one cemented to its surroundings at the bottom of each pipe.  The outer pipe is long enough to get through the first significant layer of bedrock to provide a solid foothold.  The next pipe is a lot longer and is cemented to another layer of bedrock.  All inner pipes are bolted to the top of the outer pipe called the “wellhead.”   An emergency shutoff valve makes sure that any unusual pressure pocket in the bottom of the drilled hole doesn’t throw everything back through the wellhead to create what oilmen call a “gusher.”  The progression of pipes within pipes at longer and longer depths avoid the possibility of a high-pressure oil flow leaking around the drill’s bore hole.  If that happens, oil could flow between bedrock layers to eventually find its way to the surface, contaminating everything in its way.  A slurry of water and specially-formulated dirt called “drilling mud” weighs down the drill hole to offset the backpressure whenever a high-pressure pocket is hit by the drill.  The mud also clears away the rock fragments and cools the drill.  The most critical operation is run by the person who controls the flow and height of the mud column.  This person is called the “mud man.”  If that person screws up, a high pressure pocket throws the mud column, drill, and whatever else is down there up to the surface like a rocket.  I will leave it up to your imagination what happens next.

If all goes well, the drill and innermost casing penetrates the target reservoir, finds oil, and the mud column stays put.  If the oil-bearing sand is tight, it needs to be fractured to increase the surface area so oil can flow.  They also need to get the drill and the mud column out of the hole, called “cleaning the well.”  In the early days, they would drop a canister of high explosive down the tube to fracture the surrounding reservoir sand.  Now they use a tube filled with bullets that fire into the rock in all lateral directions.  If the sand is gravel, they do not need to do either.  The gas cap at the top of the reservoir provides the pressure to push the oil through the sand, through the tube and up to the surface.  If the flow is too fast, the gas flows around the oil instead of pushes the oil.  That is why they restrict flow according to a formula they call the Maximum Effective Flow Rate.

As time passes, reservoir pressure is too low to push the oil all the way to the top.  A submersible pump gives it a nudge.  More time passes and that no longer works.  They use water injection into another well at the opposite end of the reservoir to get things moving again and call it “secondary recovery.”  Eventually, that doesn’t work either.  They pump down natural gas to increase the pressure of the gas cap.  They call that “tertiary recovery.”  Eventually they give up and plug the hole.

Location governs drilling and recovery cost

Reservoir location has a lot to do with the cost of the extracted oil. Land extraction is far less expensive than off-shore extraction. Deep-water drilling is a lot more expensive than shallow-water drilling. Transportation cost from wellhead to refinery is a significant portion of its total delivered cost. That is why some countries burn off the natural gas above the wellhead rather than compress it and refine it. They cannot recover the cost to refine it and it is too contaminated to use it locally. Care to guess why oil refineries used to stink so much and some foreign refineries still stink?  Oil reservoirs have a gas cap to provide the pressure needed to get the oil to the surface. Like soda, the gas separates when the pressure is reduced.

Making Crude Oil Saleable

Refinery processing and the energy to generate marketable end-user products add to the cost and affect the value of supplier crude. Transportation from wellhead to refinery is a significant cost of crude.  Refiners want to maximize their capacity by getting more of what they can sell with less processing effort and inbound cost. They will buy crude from multiple sources to blend their input to match the desired output.

What is behind “market price” of crude? It is the delivered price from a generic source to a generic location for a standard product with specific (fictitious) composition that does not exist, called “light sweet crude.” The actual delivered price is determined by how close the actual product matches the fictitious “standard” product. “Brent crude” comes from the Middle East or other distant origins. Other generic names are “Canadian crude”, “West Texas crude”, “Mexican crude”, “Alaskan crude”, and “Gulf Coast crude” to mention a few. Fortunately for us, we buy a fairly standardized refined product give or take a few additives hyped by the dealer and/or mandated by government (ethanol).

US oil-shale crude is light and sweet.  Middle-east crude is light but not sweet.  Libyan crude is light and sweet.  Canadian crude is mostly derived from tar sands.  It is heavy and not sweet.  They need to use chemical scrubbing and catalytic cracking using platinum and natural gas to make their product light and sweet.  Read that expensive.

Financing Oil and Gas Exploration and Production

Energy investors have a lot of choices. If landowners hold mineral rights below the land, they can obtain income from sale of oil leases. The lease also includes a fee for not drilling called a “delay rental.” This fee makes sure the oil company does not tie up the lease so the competition cannot get it. The delay rental fee stops when the first well starts drilling its hole, called “spudding the well.”

If landowners hold mineral rights above a producing reservoir, they receive an overriding royalty interest or “Override” from the producers based upon their share of the total reservoir volume. The “override” owner pays nothing for exploration or drilling costs but shares the revenue. Override owners do not need to have a producing well on their land to be eligible for royalties. Oil companies call this a “unitized field.” If an investor wants to risk capital and defer taxable income, the investor can buy a “working interest” in a well. The investor shares in a portion of the production earnings in return for sponsoring a share of the (tax deductable) drilling and exploration costs.  Once a proven reserve is geologically established, each landowner’s share of the pool that lies beneath their property is legally established.  The document they receive telling them about their share is called a “division order.”

Before oil is drawn from a reservoir, the investor of a working interest shares the tax deductable expense of the drilling cost. This is considered a taxable loss that is applied directly to adjusted gross income in the investor’s income tax return. As oil is drawn from the reservoir, the value of the mineral right diminishes accordingly.  The Government taxing authorities recognize this asset loss with a tax deduction called a “depletion allowance.”  The depletion allowance and up-front drilling costs are major incentives for high-income working interest partners to make such a high-risk investment.  Investments like this are labeled “tax shelter investments” because they defer the taxable income of the investor to later years.  If the investor continues to invest in oil and gas working interests, they can defer anywhere from 27% to all of the taxable income of their investment indefinitely.  High-income investors become low-income investors if they participate in tax shelter investments.  That lowers their tax rate in a heavily progressive income tax.

Working interests can be very expensive and a risky gamble (dry holes and oilman’s poison). Companies form limited partnerships so smaller investors can pool their investment and diversify their risk. The company is a managing partner; the investors are limited partners. The managing partner may own leases, have its own exploration company, buy and sell working interests on its own account, and charge management fees to the limited partners for its management services.

Financial houses can market funds and shares of limited liability corporations that invest in ownership of oil industry companies. A “closed end” fund is a collection of stocks that is jointly held by the members of the fund. The fund does not change its portfolio or expand its number of shares and has a dissolution date. An “open end” fund accepts investments throughout its life and changes its portfolio to optimize its reward/risk position for its investors.

Previous articles provide more insight about world oil supply and its related issues:

  • “The Imminent Threat to Israel”
  • “Oil, Religion and Politics – The Next Perfect Storm”
  • “The Iran Problem and the Military Option”
  • “Gasoline Prices and the Blame Game”

All of these articles can be found at this blog site.

For maps of the Bakken and its geological parent, the Williston basin, visit:


The following chart shows world oil production BEFORE oil shale fracking.  The USA is now the largest holder of oil reserves in the world because of oil shale extraction.

This is what it looks like as of 2012 WITH oil shale fracking:

Our greatest problem is the lack of an efficient transportation system between wellhead and refinery or export facility.  The US Government forbids the exportation of crude to foreign nations by federal law passed during the oil embargo.  US Government also is doing everything it can to build pipelines that transport petroleum products efficiently.  That is why railroads must do the job with every tank car they can place into service.  Some of these old tank cars need upgrading to make them safer to use.

Tags: oil, Bakken, Williston, energy, investment, tax shelter

Posted in Energy, Military | 2 Comments

Is Obama nationalizing retirement accounts? Updated February 2014

Tags: Obama, retirement, 401K, IRA, RRA, QE, inflation, SOTU

Our President, in his State of the Union speech, announced that he will propose a new retirement savings plan to his Treasury Secretary.  What did he mean by that statement?  If past is prologue, this is what he wants to do.  US citizens would invest in a totally government managed tax-free (really tax-deferred) retirement account.  Investors could invest only in US Treasuries.  The Secretary of the US Treasury would be the sole broker and trustee of the fund.  More about this assessment follows the economic assessment below.

Listen up folks.  When the US Government offers you financial relief for anything to make it affordable, you still pay for that subsidy in higher taxes and reducing purchasing power.

Our Federal government now owes over $17 trillion on its books under the account named “National Debt.”  This is more debt than all of the other debtor nations on this planet COMBINED.  Government statistics are heavily manipulated to hide the truth about the state of our economy.  Our Federal Government has not had a budget in four years.  They outspend their revenues so much that they have to borrow almost as much as their revenue just to pay their bills.  The Federal Reserve (FED) is required by its charter to become the lender of last resort.  The FED HAS TO BUY the bonds that the US Treasury cannot sell to someone else.  When they do, it causes inflation of the currency.  Read “inflation” as a loss of purchasing power of anything we the people own or save that is valued in US dollars.  The FED calls their actions “quantitative easing.”  I call it “theft by swindle.”

There is more than meets the eye.  The Social Security Trust Fund, Government Employee Pension Fund, and other funds on the Federal Government books can only invest in US Government bonds.  Therefore, the account balances in these funds are really an undisclosed part of the National Debt.  The US Postal Service (USPS), Fannie Mae and Freddy Mac are “quasi government” corporations.   When is the last time the USPS had any black ink on its bottom line?  How about “never?”  The FED is buying junk paper debt (mortgage-backed securities) every month to keep these home-mortgage insurers solvent.  Who “owns” Fannie Mae and Freddy Mac?  If the FED buys anything from a US Government backed corporation, it is the same as quantitative easing (alias theft by swindle).

Does the US Government show the long term liabilities of entitlement programs?  Nope!  The Congressional Budget Office (CBO) provides estimates that are downright frightening.   Social Security, Medicare, Medicaid, Tricare, ObamaCare, Federal Employee Retirement, Congressional and Presidential benefits show an estimated $115 trillion in unfunded future liabilities in current dollars.  Much of this is indexed for inflation.

The US government (with help from the FED) must keep interest rates at rock bottom to avoid a skyrocketing increase in the interest cost of a $17 trillion debt load that continues to rise with no end in sight.  Non-FED investors will not buy US Treasuries because the rate of return is lousy, devaluation through inflation is likely, and they fear the possibility of default.  The only way they can rid themselves of US dollars is to buy stuff with them (commodities) or invest in US assets (land, mineral rights, US corporate stock, real estate, etc.).  I read somewhere that 70% of General Motors common stock is owned by Communist China.  National public corporations are becoming international corporations (not by choice).

There is a significant likelihood that the US dollar will not remain the preferred reserve currency for international trade.  If that happens, all of that interest-free money floating around the world will come home to roost.  That could sink the value of the US dollar and drive us into hyper-inflation.

If the Federal Reserve holds most of the U.S. Treasury market and they are going insolvent, who do you think the government will lean on to pick up the slack?  The answer is us. About ten thousand Baby Boomers will turn 65 years-old every day until 2030, according to the Bureau of Labor Statistics (BLS).  The Federal government has a debt problem of $17 trillion that they either cannot or will not manage.  Our nation’s citizens have about $17 trillion invested in IRAs, RRAs, 401Ks and retirement accounts.  How much of that is invested in US treasuries?  Almost none.   Will the Federal Government go after these assets?  Do fish swim?

The Socialist Plan

Nationalize retirement accounts like IRAs, RRAs, 401Ks, pensions, etc.  Force participants to use a portion of their retirement wealth to purchase U.S. government debt.  This debt may ultimately default if or when it is not possible to sustain our astronomical debt or the deficits that create it.

The Plan to Nationalize Private 401K, IRA and RRA Retirement Accounts

In 2009, Obama’s budget request introduced a proposal to replace all private sector retirement accounts (401K, IRA, RRA) with Government Retirement Accounts (GRAs).  This proposal, if made law, would nationalize retirement wealth.  The online publication WND reported the following:

On May 6, 2012 Lauren Schmitz, a research analyst at the Bernard L Schwartz Center for Economic Analysis (SCEPA), introduced HB5337.  This 401(k)/IRA de-privatization is the brainchild of Teresa Ghilarducci, whom through funding from the White House and the Ford & Rockefeller Foundations engineered a new ‘Regulatory & Tax Incentive.’  The purpose is to force Americans to convert their Retirement Accounts into Government Managed accounts.

“This plan to nationalize private 401K and IRA retirement accounts is being deceptively publicized as the government protecting the public against business failings or state bankruptcies.  Your cash, your retirement funds, your bank deposits and your investments are at huge risk of being confiscated by the government through some contrived reason or another.”


I used search engines to find other sources for HR5337.  I found sites copying each other’s information, but no direct reference from the US Congress.  Either it never saw the light of day or it never happened.  I also wondered how a non-legislator could introduce a bill to the US Congress.  Having said that, I still wonder if a Democrat legislator would introduce such a measure if they thought it had any chance of passage.

If conservatives unite, take control of the US Senate, and retain control of the House of Representatives, they could impeach the President, the Vice President, and clean house.  Otherwise, we will witness the destruction of our Constitution and Bill of Rights, confiscation of our investments and savings, and witness a repeal of Presidential term limits.   The 2014 elections are crucial for the survival of our nation.  Conservatives must unite to stop the fundamental transformation of our nation into a socialist dictatorship.

Benjamin Franklin had a name for people who complain loudly, do nothing, sit back and let the world go by.  He called them “mugwumps.”  A mugwump is a person who sits on a picket fence and complains about his painful perch to anyone who passes by.  Yet the mugwump continues to sit on the pointed fence with his or her mug on one side and their wump on the other side.

A personal friend offered me a political observation that went something like this.

“We must consider the consequences of our decision to vote or not to vote, as well as our vote choice.  If we stay home because we do not like any of the above, we all lose and our common enemy wins.  If we vote for a candidate who cannot possibly win, we not only vote for a loser, but also prevent a winner that could defeat our common enemy.  Most likely, a candidate that could win has only an 80% political ‘purity.’  If our candidate of choice has a 95%+ political ‘purity’, we need our head examined.  If we do not vet the candidate and blindly vote because it is our duty, we are an idiot.”

I cannot argue with his assessment.  Can you?

Tags: Obama, retirement, 401K, IRA, RRA, QE, inflation, SOTU


Posted in Economy, Government | Leave a comment

Solar Power – Boon or Boondoggle?


Tags: solar, energy, power grid, subsidy

The Minnesota Legislature passed a law granting up to $500 million to fund solar power projects for Minnesota primary residences and businesses.  Installers must be Minnesota businesses.  Both thermal and electrical systems are eligible.  If applications exceed $500 million, the grants will be decided by lottery.  Grant limits vary by type of system and type of end user.  Recipients will be reimbursed based upon the amount of electricity they generate in annual installments.  Deadline for submissions is February 28, 2014.

A local church with a primary school asked me for an opinion.  A State-qualified contractor proposed a $140,000 electrical solar panel installation.  The following is my report, redacted to protect their privacy.

Executive Summary

The proposal submitted by [contractor] describes a combination of a lottery, a public grant, a potential insurance problem, a potential cash-flow problem and a conditional sales contract.   This should be brought before the Parish Finance Committee ASAP to assess the financial consequences of winning the lottery.  The proposal also requires [Area Church] approval by [Area Church Insurer] before the Pastor could sign off on this lottery because it involves a conditional sales contract with [contractor].

As of today, the technology for solar energy is not competitive with other forms of energy, especially at this latitude.   A year from now, that may change.  A small company has a patent that [allegedly] coats the photovoltaic cells to double their efficiency.   This startup company plans to build a manufacturing facility to apply coatings in a mass-production environment.  This facility could be on-line within a year.  However, their production will not handle the expected demand.

[Another neighborhood church] already committed to install a $140K solar array.  You may want to talk to these folks since they are a block or so to your East.

Solar Power Infrastructure

Solar energy (photons) generates direct-current electricity when they strike the surface of a photovoltaic cell.  Individual cells connected in series (called panels) multiply the voltage the same way flashlight batteries do when batteries are arranged head to tail.  Banks of panels (called arrays) connected in parallel (one wire connects the heads; the other connects the tails), increase the amperage output that supplies a direct current (DC) load.

If the facility can use DC power, the arrays can be tuned to supply the voltage input of these devices.  Otherwise, the DC power the arrays produce must be converted to alternating current (AC) before it can be used.  These devices are called DC/AC inverters.  If they supplement a total AC load provided by the local power company, the inverter must synchronize its output to match the frequency and precise timing of the local power company feed.

If there is a power outage from the array (night time) or a power outage from the power company, an automatic switch must be “locked and loaded” to disconnect the solar array instantly to avoid damage.

Electrical cabling is required to connect all of these components together.  That stuff costs money too.

The angle of the sun varies up and down and side to side as the earth rotates.  The solar array converts photon energy to electricity based upon the sine of the angle of the sun to the array.  This requires actuators to focus the panels vertically and horizontally to face the sun’s rays to a 90 degree vertical and horizontal angle for maximum efficiency.  That requires all-weather moving parts driven with electronics to point them at the right place.  That extra feature also requires maintenance and more money for maximum efficiency.

Today’s solar cells reflect about half of the sunlight they receive.  A startup company has a patent and demonstrated a proven method to coat solar cells so they absorb all energy instead of just half.  However, the coatings must be applied only to uninstalled panels under clean-room conditions.  They are building a coating plant to mass-produce coated panels.  When it comes online, there is no way it will meet market demand.  Read that expensive, even if customers wait until this technology is available.

Solar panels do not work as advertised if they are covered with dust or snow, or succumb to hail damage.  Dusty wind, airplane engine fallout, automobile exhaust and diesel particulate exhaust coat the panels with sticky goo. Abrasion and chemical corrosion attack the surface of the solar panels.  That combination diminishes their serviceable life.  Ergo, these panels do not last forever.  Some installations in semi-desert areas even protect their solar arrays with glass housing similar to growers of plants and flowers.

If the solar array is roof-mounted, how does one re-shingle a roof or repair a leak?  If it is a flat roof, these roofs are born to leak.  Every hole is a potential leakage spot.  Arrays require lots of footings.  Will the solar arrays require lightning protection?  How about electrical grounds?

Also, someone has to remove the dust, snow, and sticky goo.  The actuators, inverter, fittings, and other stuff need periodic maintenance.

And then there is the matter of insurance premium expense to cover an extra $140K+ increase in property value.

[Local Church and School] Solar

The lower-school has a flat roof over the auditorium.  This is enough space to support a large solar array.  The electric transformer that powers the entire campus is located outside the south side of the school next to the gymnasium entrance.  The inside of that outer wall is backstage of the auditorium.  That area provides a straight shot directly to the area above the auditorium with no barriers below the flat roof.  This looks to me like a very simple and straightforward installation for a connection between a roof-top photovoltaic array and the central power source for the entire campus:  the load side of the power company’s three-phase transformer.

The middle school [connected but separate building] also has a flat roof, but it has a roof-mounted air conditioner in the way.  It could support a solar-thermal system that could heat water.  The interstitial space behind the middle-school bathrooms provides a straight shot through unused steam pipe chase holes through the floors from roof to the crawl space under the first floor.

The foyer roof is flat, but unsuitable for solar.   It is lower than the other buildings.  That would restrict sunlight.  There is no direct connection for either electricity or hot water.

The lower school roof is the best choice.

Total Cost of Ownership

Assuming [local church and school] gets a grant for $140K, what does it buy and when do they pay?  So far we identified a lot more stuff than a solar array that is required to make this work.  We also identified more ongoing costs to own and use after it does work.  If Shakespeare was a member of our finance committee, he might say, “Methinks the devil is lying somewhere in the details like a lion ready to pounce.”  Perhaps we need to “peel the onion” and take a closer look.

The Political Factor

What and who is driving this lottery?  More important, why are they doing it?

[Electrical power company] and the other regional electric power providers have a new franchise agreement.  Among other things, it includes a mandate that the power company’s generation capacity must include at least 20 percent renewable energy.

These power companies have some options to consider.  Some people call these options “tough choices.”  This is management language that means “It does not make economic sense, but we have to do it or lose our franchise.”

One way to do this is to buy renewable energy from someone else.  Power companies can buy surplus renewable energy from consumers (even if they don’t buy much).  If they do, the power companies can count the consumer’s capacity as part of their renewable energy capacity.  Ergo, they do not have to finance the renewable infrastructure or maintain it.  The capacity they buy comes from their customers who are at the consumer end of the wire, not the power plant’s end of the wire.  This means that they do not have to endure the power loss and and invest in the distribution infrastructure to transmit as much electricity from point A to point B, C, D and E.

What is the worst condition power companies face (not including Christmas lights)?  It is hot summer days during the work week with air conditioners on full load with no wind.

Conventional steam plants require up to 18 hours to reach their full generating capacity.  They run most efficiently at full load.  They cannot respond quickly to peak load.  The power companies need natural-gas-fired turbines (jet engines connected to dynamos) to handle peak loads.  Jet turbines need only a few minutes to handle the peak load that stresses their generation capacity.   Also, they can be throttled back to partial load conditions quickly.  Natural gas is NOT a renewable energy.  Even though power companies do not run gas turbines all the time, their full capacity is part of total non-renewable generating capacity.

If wind farms have no wind, their output is zero.  Yet their full-load capacity is used to determine the power company’s total capacity for renewable energy.

If the winner is a for-profit corporation, the property taxes increase because the solar array system increases the assessed property value.  This benefits the tax jurisdictions (school district, city, and county) for the life of the installation.  Heck of a deal for whom?


The surest way to make the new system cost more than the old is to pioneer the wrong thing.  The surest way to lose in poker or blow a budget is to throw good money after bad, trying to make the wrong thing work.  The surest way to make a solution fail is to let a politician design it.

Tags: solar, energy, power grid, subsidy

Posted in Energy | Leave a comment

How do “liberals” think?

Tags: liberal, civics, politics, constitution, law, government

The following question appeared in a local community public Internet forum.  “Why is Civics not taught in public schools?”  I partially redacted names and sources of two responders to protect their identity.  I also partially edited their prose to improve readability.  I will call them “Jim” and James.”


Jim wrote:

Civics is anti-American.  Anyone who believes they have a responsibility beyond their own nose conflicts with the values that people display in their everyday lives. If Americans decide to live like socially responsible people, they would fire the first shot in a revolution.

James replied:

Civics does not mean that a person is responsible beyond their own nose; it simply allows the person to SEE beyond their own nose.  Even though you are not interested in politics, politicians are interested in you!

Politicians play so loose with the rules because a significant part of their constituents do not know what the politicians are SUPPOSED to do.  These same constituents, called “low information citizens”, also are clueless about what their political representatives are ALLOWED to do.  This part of the public also is ignorant about the wisdom of people in the past who wrote the rules for political behavior that limits political power over the people. Otherwise we would not be so complacent about the erosion of the rights of the average person. Those wise men made it possible for Jim to not care or be responsible about anything beyond his own nose. It is his right to do so. But the law-givers sincerely believed that enough people would know and respect the law to limit tyranny over the ignorant.

I believe that every person in this city SHOULD know the basic content and meaning of the City Charter, the State Constitution, [The Declaration of Independence, The Bill of Rights] and the Constitution of the United States.   You eventually read the instructions for your computer so you at least now know what it is supposed to do and not do.  If every voter knew the rules about political behavior, more voters would ask why Council Members and Mayors ignore the documents that give them legitimacy in office. The importance of those documents and their contents do not limit the actions of the individual.  Instead, these documents limit the actions of the politicians.  That key principle should be one of the first things taught in “Civics”.

The civics curricula also should include a study of the “Federalist Papers.”  I really get peeved when people spout falsehoods about the intent of the constitutional framers. These people were some of the finest writers of the English language in history.  They meant exactly what they wrote, and then explained WHY they wrote it into law. I am amazed by the ignorance of some people who say the Constitution is a flexible document whose meaning should change over time. No, it only changes over time when it is lawfully amended.  The means to do that IS part of the document.  In fact, part of all three of the Charters define and limit the powers of government in the city, State, and the United States.  These same documents include a prescribed procedure to amend the document’s content.

Politicians at the City, the State, and in particular the Federal level, count on an ignorant group of people who know nothing beyond their nose. These same politicians especially count on people who know nothing about limits that impede government actions.  For example, WWII educated (at least minimally) a large number of previously compliant docile share-cropper workers.  That education is one of the reasons why the sharecropper system in the South broke down.  Civics education also fostered the Civil Rights movement.  It succeeded because people were educated to some degree about “Civics.”  They knew their rights and the power limits of the Mr. Eddies, and Sherriff Billies”.  I believe that the Civil Rights movement educated and then empowered people to demand their “Rights.”

Jim, you do not HAVE to know, or be responsible, for anything beyond your nose.  However, our city’s children AND adults should know and be responsible because they and you need to know and be responsible.  Otherwise, you might find something in front of that nose of yours that you do not like.  Revolution comes from the moral outrage of a people against the behavior of political leaders who overstep the legal limits of their rule. Outrage has no foundation if you do not even know these limits exist.  Our Country, our State, and our City are based on those limits. Without them, these governments have no right to exist.  (In my opinion, the last Mayor and Council of our city lost any legitimacy after they ignored their own City Charter.  However, most voters in our city were ignorant of that fact.)

“Civics” also gives an individual a knowledge base to understand the lessons of history.  I know and understand a lot about where and why those rules that limit political power and tyranny were established.  I am really angry when politicians and their devotees get around to hitting me in the nose.  At lease I am aware of who, when and why they did so when it happens.  Are you?

Wise people say that Knowledge is Power. That principle of wisdom probably explains why those elected officials no longer care to have Civics taught.  Some say ignorance is bliss.  Experience shows that ignorance is not blissful where politicians are concerned.  We have a culture that presumes government and politicians should not be trusted without verification.  Our culture originated with “Revolution.”  It is the responsibility of citizens to participate in government “by the people and for the people.”   Our culture allows some to ignore their responsibility, but it is their responsibility none the less.

Personal Observations:

I doubt if James changed Jim’s mindset about anything because Jim was not disposed to listen.  However, James’s reply is well said, and might have influenced others who were disposed to read, listen and learn from James.

Yesterday (January 20, 2014), I happened to tune in to C-Span.  The author of the book, “Kindergarten of Eden” was the speaker of a meeting somewhere in California to a “Silicon Valley” group.  The topic was about how “liberals” think.  Two things caught my attention:

  1. Inequality of rewards for success is a sin.  The rich should share their fortune among people who have less than they do.  [This attitude comes straight from Karl Marx’s Communist Manifesto, “From each according to their ability; to each according to their need.”]
  2. Innovation and success breeds inequality.  Creative thinking breeds innovation and success.  Therefore, it is a sin to think.  Other great and noble thinkers need to do that for us.  [That attitude also is found throughout Karl Marx’s Communist Manifesto.  His first step toward his utopia is the dictatorship of the proletariat by ruling elite.  This excludes the religious elite because they are powerful enough to successfully oppose his brand of utopia.  That explains his statement, “Religion is the opiate of the masses.”]

I probably just butchered the correct context of his remarks.  Guess I will have to read his book to understand what he really said and meant.

What is your take about how liberals think?  Who are these people?  How large is their membership?

Tags: liberal, civics, politics, constitution, law, government

Posted in Education, Government, Politics | Leave a comment

Fixing the Wrong Thing

Tags: obamacare, “Obama care”, health, insurance, welfare, ”term limits”, initiative, referendum, recall

The original private-sector health care system needs fixing, not Obama Care.  The future cost of the Obama Care entitlement program, according to the Government Accounting Office (GAO), is about $44 trillion plus inflation.  The debt service cost of Obama Care alone will exceed the entire revenue income of the US government under the current tax structure.

Insurance is about sharing the cost of RISK.  Welfare is about sharing the cost of CERTAINTY.  Any program that combines the cost of sharing risk and certainty is by its very nature unaffordable.  Tort law reform is necessary to make any health care delivery system work.  It makes no sense to punish the customers and stockholders instead of the bad guys that broke the law.

The surest way to make the new system cost more than the old is to pioneer the wrong thing.  The surest way to lose in poker or blow a budget to smithereens is to throw good money after bad by trying to fix something that cannot possibly work.  The surest way to make a program fail is to let a politician design it.

Obama has the GOP House over a barrel because he has control over the US Senate. He also packed the US judicial systems with people who disrespect the US Constitution instead of uphold it.  That reality makes him unimpeachable.

We need to stop talking, whining and writing “Isn’t it awful” messages to each other and start doing something about it. We could start by becoming activists for a common cause.  We must become a house united against our common enemy instead of a house divided against itself.

There is no such thing as a “politically pure” candidate.  Our enemy from within is not our President and his minions. It is the people who allowed him and his minions to be elected and re-elected.  That includes not only those who voted, but also those who stayed home and did nothing.

I hear a lot about term limits being the answer and “throw the baby out with the bath water” as the means to that end.  Did you know that term limits for the President and Vice-President are in our 22nd Amendment of US Constitution?  However, there are no term limits for any other federal elected office within the US Constitution.  The US Constitution also states that the US Congress is limited to those powers that are specifically granted (enumerated) within the US Constitution.  The rest of legislative powers are the domain of the member States.  Some States grant the right of their citizens to some combination or all of initiative, referendum and recall.  The US Congress cannot impose term limits upon its membership or impose all States to enact term limits, initiative, referendum and/or recall.  It requires an amendment to our US Constitution to make that happen.  Of course, the Federal Government continues to ignore the US Constitution with impunity with the implied consent of the US Supreme Court.

Listen up folks.  The enemy only needs control of both the US Senate and House of Representatives to “fundamentally transform our nation” because our Court System allows them to do it.  If they control enough States to have control over a Convention of the States, they could replace our Constitution with one of their own liking. That fact, at least for me, is a really scary thought!

Please!  We must stop whining, gnashing our teeth and do something positive together.  Our nation is in peril.

Tags: obamacare, “Obama care”, health, insurance, welfare, ”term limits”, initiative, referendum, recall

Posted in Government, Health Care | Leave a comment

A Father’s Letter to his Children

Family wisdom and the life story of family patriarchs often are lost because parents neglect to pass it on to their children.

This letter is about advice given to me by my father, now deceased.  I was about to enter high school when this conversation took place.  It also includes a bit of personal history that followed that conversation.  Hopefully, you might find a thought or two worthy enough to pass on to your children when they are old enough to understand and disposed to listen.

I was not a hugely gifted person.  I had to work hard and study long hours to accomplish whatever I set out to do.  Our family began from humble beginnings.  My dad did not finish high school.  However, he used his God-given gifts and personal relationships wisely and well.  His business success earned upper middle class income, so finances were not a huge problem.  His personal challenge to me was to become the best that I could be.  Affordability was not an excuse.

He taught me things I did not learn in school through his example and shared wisdom.  One day, he shared this with me when I was depressed.

“Son, successful endeavors are 5 percent inspiration and 95 percent perspiration.  You will be competing with peers that are a lot smarter than you.  You are now in the age group that can learn and remember more easily and have more time to do it than in future years.  Do not waste it.  Do not damage your health and ability to think with unhealthy life styles and bad habits.

“Also know that you must continue to learn and study throughout your life.  Job skills can become obsolete.  You need to learn how to excel in your present career and prepare for an optional career skill in an emerging job market.  One of the biggest mistakes people make is accepting the idea that they cannot do something.  It becomes a self-fulfilling prophesy.   Do not go there.  It is a recipe for failure.

“Learn to cultivate friendships and be trustworthy.  You will need the respect, trust and help from others to succeed.  Friends also are a valuable teaching resource.  Those who try to protect their career turf will lose it.  Those who share their career turf gain more because they are promotable.

“One more thing . . . Seek balance in what you do.  Never focus your energy on just one thing.  Get involved in activities.  Cultivate friendships that endure.  Treat people the way you wish to be treated.  Broaden your scope of study. Do not fall into the trap of knowing almost everything about almost nothing.  Your education should qualify you for a lasting career, not a hobby.

“I learned these things the hard way.  You can learn them from me if you listen, remember and follow my advice.”

I had a lot of personal talks with my father about many subjects that were not taught in school.  It stimulated a sense of discipline and discernment that proved highly valuable throughout my work career and personal life.

My teenage life was more difficult than most.  Dad was a business man, owner of his own companies, and had over 50 employees.  He also was a prominent civic leader.  I was the eldest son of a local celebrity.  People expected me to fill my father’s shoes.  Sometimes I had to take the heat for my father’s alleged mistakes.  Dad also worked long hours.  As the oldest son, I became the second father of the family.  That was tough with three siblings and a baby sister.  I had a part-time childhood.  That was sad.  However, it gave me a head start in becoming a responsible adult.

Mother and Dad always knew that I was destined for a career in science or engineering.  I was always taking things apart to see how they worked.  One day, knobs were missing from a bathroom wall light fixture.  They found them on a Heath kit I was assembling in my photographic dark room.  I also was into photography.  I would buy bulk film and reload my cartridges.  I also did my own developing and printing.  One day, Dad brought home a used pin ball machine and a box of spare parts.  My siblings and friends played pin ball.  I had to keep it running.

My high school grades were good enough to be accepted in a major university’s School of Mechanical Engineering.  I had to register for military draft, so the college deferment was a welcome relief to my parents.  However, I had a patriotic streak and was accepted into the university’s Air Force ROTC program.  My eyesight did not qualify me for flying status, but my engineering major qualified me for “technical non-flying” status.  Upon receiving my Air Force Commission, I was accepted at an Ivy League University.  The US Air Force granted me a Category C Delay that postponed my tour of active duty for two years.  I double-concentrated in managerial economics and finance to earn a Master of Business Administration (MBA) Degree.

I served my Country for thirty-seven months active duty, two more years in the ready reserve, three years in the standby reserve, and then resigned my Commission. I was a civilian at heart.  After a few months of my first year of active duty, I married.   My parents wanted me to learn how to live on my own and accept responsibility.  We had to live within a budget, make car payments and live like everyone else . . . within our means.  This included a stay-at-home mother of our first son.

I remembered another thing Dad said during one of our “teaching moments” together.  “Son, it is not enough to live day by day.  Emergencies will come along that must be met.  Build up savings to get you through these emergencies gracefully when they come.  Buy insurance for the big risks.  Prepare for the certainties that burden a family with children.  Do not get into debt that you cannot afford.  Borrow only for things that save you money or are necessary.  Share with your wife the financial affairs of the family so she can learn to manage the family income wisely and well when you are not around.  Learn how to do her duties so you could manage the home when she is not around.  You are each other’s backup.  That is critically important now that you are a father.

“Also be generous in charitable causes with your time, talent and treasure.  God expects us to care for each other.  You may find that you will need outside help through the generosity of another person.  Give to your church.  God requires it

 “If all is well and you live a long life together, you will eventually retire.  Be aware that retirement is a lot easier to finance if you start early.  If you earn an income for 45 years or so, and live another ten years, you must save enough and invest enough to have a retirement income.  Salt that money away first so you do not notice it missing.  ‘Take-home pay’ is net of both taxes, insurance, and personal savings.”

Little did I know that up to 80 percent of my retirement nest egg would be stolen from our family without any legal protection.  Hold that thought because I am getting ahead of my story.

Throughout my career, I saved and invested like Dad taught me.  My broker also was my financial adviser, or so I thought.  We invested in an annuity that turned into a Ponzi scheme.  We lost $4,000 at a time when that was one tenth of our annual income.  That hurt.  It also taught me to do my homework and not rely solely on another person’s advice.

We did all the right things to be financially responsible.  Once our children were grown up, my wife entered the work force.  Eventually, she became eligible for Social Security.  I allocated the maximum in my employer’s 401-K plan.  We started an IRRA for ourselves.  We also participated in the employee “cafeteria plan” to minimize the cost of our family’s health care.  We invested in a diversified portfolio.  I purchased insurance to cover emergencies.  We sacrificed to educate our children.  We lived within our means.

When retirement came, we looked back and wondered if we had saved enough.  When we married, bread cost 34 cents per loaf.  It is now over $3.50 per loaf.  Back then, gasoline was 28 cents per gallon.  Now it is over $3.00 per gallon.  When we bought our home, our mortgage and property taxes were less than one sixth of our current property taxes alone.  What happened to the purchasing power of our life savings?  More importantly, WHY did this happen?

Our family’s purchasing power eroded for many reasons.  Your income and savings are eroding now for the same reasons.  They include the following:

  1. The Federal Reserve central bank inflated the currency, eroding its purchasing power.  This is a hidden tax upon personal savings and investment.
  2. The Federal Government outspent its revenue so badly that the US National Debt soared to unsustainable levels.  When we married, it was less than $300 billion.  Now it is $17 trillion.
  3. Organized labor received more pay for the same or less amount of work.  Pay increases even exceeded the savings of their employers through increases in productivity.  Their contracts included work rules and “maintenance of standards” clauses that stifled productivity savings.
  4. Government at all levels outgrew the private sector.  The cost of government choked return on investment.  Taxes, tort lawsuits and legal expenses stifled business innovation and economic growth.
  5. Employers had to raise prices to cover their increased costs.  Their suppliers had the same problem and had to increase their prices to cover their costs.
  6. Portable energy became more expensive to extract because the easy-to-reach resources were exhausted.  Foreign price competition drove manufacturing away to foreign shores.
  7. Government taxes and shoddy trade agreements made foreign trade uncompetitive.  Government growth and interference consumed resources in competition with the private sector.  Government regulation increased administrative costs and imposed outcomes that made no sense.  All of these circumstances, and others not mentioned, combined to steadily erode the purchasing power of the dollar.  Some people call it “quantitative easing” and “economic stimulation.”  I call it “theft by swindle.”

It gets even worse.  The Government taxes capital gains that are mostly inflation.  We are paying taxes on government monetary and fiscal mismanagement.  How is that for a rip-off?

Now we wonder how much longer we will have access to quality health care.  We tried our best, played by the rules, and have less and less to show for our financial efforts through no fault of our own.

For your consideration,


Posted in Uncategorized | Leave a comment

“I cannot do that” . . . a self-fulfilling prophesy

Tags: behavior, attitude, achievement, hope

While we were growing up, how often did we hear the words:

  • “Don’t do that!”,
  • “Stop doing that!”,
  • “No, you can’t do that!”, or
  • Similar negative orders?

Next, consider all the “put downs” we receive and endure as an adult. Who said these things? Did they offer a reason or a positive remedy? Were their words helpful or destructive? Why do you think so?

How often do we receive:

  • A genuine compliment,
  • Statement of gratitude,
  • Words of encouragement,
  • Advice and counsel from a mentor or personal friend, and/or
  • Public recognition for personal achievements and for contributions to team efforts?

Who said these things? Did they offer a reason? Were their words helpful or destructive? Why do you think so?

Clinical psychologists claim that people receive far more “put downs” than words that uplift their self esteem. The net effect of these “put downs” damages self esteem. Low self esteem attacks self confidence and self worth.

If we (their victim of choice) do not understand what is happening to us, we begin to believe what we hear. We become the person others say we are through our attitude about our capabilities. Instead of cultivating our talents and skills, we doubt that we have them. We hide from the hurt by avoiding our exposure to the “put downs” of others. Instead of “I can do that.” we say “I can’t do that.” We do not risk failure because we do not even try to succeed. We live up to the expectations of others instead of our own expectations. That is why “I cannot do that” becomes a self-fulfilling prophesy.

Now, consider our own communication to others. Do we “put down” others or damage their reputation with gossip and confrontations in front of others? Or do we praise in public and censure in private? How often do we uplift another person’s spirit? Do we liven up a room full of people when we enter or when we leave?

Finally, consider the people we most admire and respect. Why do we give them our admiration and respect?

Tags: behavior, attitude, achievement, hope

Posted in Education, Religion | Leave a comment

Obama Care Press Conference Revisited

Tags: Obamacare, health, speech, Obama

This “press conference” did not start late morning November 14, nor did it conclude that morning.  What happened that morning looked more like damage control.  It’s scope was controlled and carefully rehearsed.  The Q&A was directed with a play script that looked like a TV soap opera.  Here is why I think so.

Size-up of the situation

  1. The conservative Congress successfully hammered the President’s leadership, personal credibility and personal honesty.
  2. The prior day, Speaker Boehner made a very forceful speech to the American public that challenged Obama about these issues.
  3. The mainstream media could not spin the problem away, so they started being a bit more objective in their reporting of the news.  Not even the Philippine disaster could deflect attention away from this issue.
  4. The American people (including illegals) finally started seeing consequences of Obama’s policies and behavior that affected them personally.  They did not like what was happening to them.  They especially did not like their President and his minions lying to them.
  5. The more moderate (I use the term loosely) Democrat politicians saw their constituents in an uproar and “read the tea leaves.”  They noticed that their electability was in danger.
  6. Obama noticed that his hammerlock on the US Senate was no longer secure.
  7. Foreign political leaders, international bankers and large corporate donors were reassessing their collective opinions of his “abilities” (leadership capability and predictability) loyalty, personal honesty and personal honor.  These opinions risked a change in their rational expectations about the direction of the United States with him at its helm.  Allies remain so long as it supports their interests.  When relations deteriorate, the consequences are predictable (all bad).

Therefore, this “press conference” had to happen.

Was President Obama sincere?

Years ago, I read something about non-verbal communication nicknamed “body language.”  It included  non-verbal clues people make when they are lying about their behavior in self-defense.  Here is an incomplete list.

  1.  Their head is off-balance as they speak,
  2. They look away to avoid eye contact,
  3. They blink their eyes often, indicating emotional stress,
  4. Their speech contains mid-sentence  pauses and run-on sentence structure,
  5. Their face frowns as they speak and smirks when they listen,
  6. They point fingers at the audience with hand gestures.

Did Obama do these things as he spoke?  Yes to all.

I wonder if he was wearing that ear piece he used in the third Presidential debate?  After all, he did turn his head to his right and pause between the question and his answer as
he appeared to think.  He had no teleprompter to guide him.





Was it scripted?

The mainstream media, especially CNN, reported leaks about what the President was expected to say.  They played part of Boehner’s speech to assure the public knew the Republican talking points that Obama had to refute.  This replay ended with “Obama Care cannot be fixed.  It must be repealed entirely so we can start over.”  Pelosi’s remarks were aired repeatedly: “We know how to fix this.” and “Critical legislation won’t get done because we are fussing about medical care.  We only have 15 days left before recess.”

Obama began with the Philippine disaster relief to show people that he cared about people.  Obama said exactly what the media expected him to say.  He also counterattacked Boehner’s talking points, and then mentioned the Government shutdown, implying that the Republicans (not him) were responsible.  He reminded the audience that the prior health care program was also broke before Obama Care was made law.  He looked down at the list of questioners and called them by name.  He used the questions to reinforce his talking points.  His blink reflex showed that he was prepared for the question and had a rehearsed answer planned.  He leaned forward and looked at the camera instead of the questioner and started finger-pointing away from the camera lens as he spoke.

After the press conference, the mainstream media picked up the drum beat with news repetition.  I fully expected that this would last for as long as the audience would tolerate it.  They did not air the story very long.  Their listeners and readers weren’t buying it.  Advertisers noticed, so the mainstream media moved on.  Advertising revenue is the energy source that fuels their bottom line.

Obama later announced a one year delay in small business compliance while they fixed the web site.  This action kicked the can down the road past the 2014 election cycle so the voters would not feel the consequences before they went to the polls.  The consequence he feared most was the loss of a Democratic controlled US Senate.  Impeachment would be inevitable.  Most if not all of his political hopes and dreams would be lost.

Can Obama’s signature health care law be fixed?

There is more to health care than insurance.  Insurance is about sharing risk.  Welfare is about sharing the cost of certainty.  Not all risk is an insurable risk.  If the risk pool is not large enough to statistically determine the cost of membership, it is not insurable.  If the risk pool includes certainty, it is not affordable.

Insurance is not a contract.  Instead, it is a subscription for a provided service.  That is why the insurers call them “policies.”  If the health care recipient does not have “skin in the deal”, they will have no incentive to live a healthy lifestyle and will overuse the health care system.  If government becomes involved, personal freedom is at risk.

Therefore, health care is about personal lifestyle, investment, insurance and welfare entitlements.  “Obama Care” is not fixable because (an incomplete list):

  1. It is blatantly unconstitutional,
  2. A stack of regulations 8 feet high cannot fix it,
  3. Presidential administrative orders cannot fix it,
  4. Health and Human Services cannot administer it,
  5. It is based upon a logical fallacy called forced hypothesis,
  6. It is not affordable to anyone by any realistic means of financial measurement,
  7. It’s fundamental design violates human nature. and
  8. The United States debt load is so huge that we cannot service existing debt without the devastating effects of quantitative easing (FED induced currency inflation).

Even foreign governments advised the United States that it will not work.  The consequences of their own single-payer plans are evident, so they speak from their own experience.  Even its authors, legislators, organized labor, the President and his minions, all exempted themselves from it.

If you learn that corporate insiders are selling their stock, would you invest in that company?  If you were a sailor considering a berth on a ship and you notice rats crawling toward shore on the tether lines, would you sign on?  I didn’t think so.

Want more information?

For those who want more depth of understanding about the health care issue, choose the
category “Health Care.” If you scroll down the home page and look to your right, you will see a list of 14 categories.  Click on a category and you will receive a page of topics related to that particular category.  Health care is one of them.

Tags: Obamacare, health, speech, Obama

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