Friday, February 27, 2015

LNG exports

Six Democrats and six Republicans have introduced a bill in the senate to expand the US facilities to increase exports of natural gas. Because of fracking the US now has an oversupply of natural gas and can now export. This means more high paying jobs here while maintaining low prices. It means that Europe will not have to be so dependent on Russia and can stand up to Putin. It means replacing coal and oil with natural gas and that reduces air pollution and helps to solve the problem of climate change. The government has been reluctant to issue the necessary permits to allow construction of liquefying plants and equipment and this law will change that. Construction of one such plant is underway in Louisiana and expected to cost 4 billion dollars. Better late than never!

Thursday, February 26, 2015

Balance of power

The congress is trying to reign in The Presidents power by threatening to withhold funds and that is the way the constitution is designed to balance power between the branches but it will not be used because it is political suicide to shut down the government. The other alternative is to impeach and that is also political suicide so the power remains in the hands of the president whoever he may be. The recent fight over The Presidents offer to 5 million undocumented immigrants is a good example of this power. The President said on 22 different occasions that he does not have the power to offer this to these immigrants. “America is a nation of laws, which means I, as the President, am obligated to enforce the law. I don't have a choice about that. With respect to the notion that I can just suspend deportations through executive order, that’s just not the case - The President is a constitutional lawyer who knows that laws are passed by congress and implemented by the president. Here is a quote from him saying he is changing the law. “Now, you’re absolutely right that there have been significant numbers of deportations. That’s true. But what you are not paying attention to is the fact that I just took an action to change the law. One of the outcomes of the fighting between political parties is that the congress is no longer on an equal plane with the president as outlined in the constitution. The balance of power between the branches is threatened.

Wednesday, February 25, 2015

War

Article 1, Section 8 of the constitution says congress has the power to declare war. President Obama has been conducting military operations in the Middle East but now realizes that ISIS is a threat to the United States and wants something official from the congress to continue these operations. He says he does not want to use enduring offensive ground combat operations and wants all operations to cease in three years. This is reminiscent of Obama when he named our mission , Operation Inherent Resolve. Former Secretary of State and Chairmen of the Joint Chiefs said of war: As Powell said in an April 1, 2009 interview on The Rachel Maddow Show, the Doctrine denotes the exhausting of all "political, economic, and diplomatic means", which, only if those means prove to be futile, should a nation resort to military force. Powell has expanded upon the Doctrine, asserting that when a nation is engaging in war, every resource and tool should be used to achieve decisive force against the enemy, minimizing U.S. casualties and ending the conflict quickly by forcing the weaker force to capitulate. There is a profound disconnect between these two views of what war is and this must be resolved before congress can declare war.

Sunday, February 15, 2015

Muslim culture

Defenders of Islam assert that the beheadings do not represent their religion and most in the West agree but looking at the normal behavior in Muslim countries reveals many practices which seem to treat women as second class citizens. Islamic laws and cultural customs impact various stages of a Muslim women's life, including her education, employment opportunities, rights to inheritance, female circumcision, dress, age of marriage, freedom to consent to marriage, marriage contract, mahr, permissibility of birth control, divorce, sex outside or before marriage, her ability to receive justice in case of sex crimes, property rights independent of her husband, and when salat(prayers) are mandatory for her.[4][5][6] Polygyny is allowed to men under Islam, but not widespread; in some Islamic countries, such as Iran, a woman's husband may enter into temporary marriages in addition to permanent marriage.[7][8] Islam forbids Muslim women from marrying a non-Muslim. These are some of the things that are called to attention when observing Muslim countries. Talking about the extremist just diverts attention away from what happens in everyday activities. Even something as basic as allowing a man to have four wives calls into question the concept of equal rights. It is time to shine the light of modernity on these cultural activities and not be blinded by excesses.

Saturday, February 14, 2015

Buying votes

The question of why people do not feel the improvement in the economy keeps coming up. The stock market is up, housing has bottomed out and the stated unemployment rate is down to 5.6% so why are people still in the doldrums. The answer is the labor participation rate and wages. The percent of eligible people working is 62.9 and this is the lowest since 1979. In addition wages for middle and low income Americans have been stagnate. The government has been handing out benefits to these middle groups but what they really want is a job and that has to come from the private sector. One of the economic arguments for handing out money is that it will stir up the economy but the same argument can be made for reducing taxes. What is the difference between handing out a billion dollars in benefits and reducing taxes by a billion dollars? In the first case the government gets to control the spending and in the second case the individual gets control. When the government controls the spending it helps them control the voting which in turn leads to more spending which leads to more votes. This is the path the country seems to be on and will likely continue unless some changes are made. Here are quote from a couple of very smart people. “Once the people find they can vote themselves money, that will herald the end of the Republic.” – Benjamin Franklin “The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.” ― Alexis de Tocqueville

Most admired

Cary Grant was a famous actor and was considered worldly, sophisticated, debonair and a dashing sex symbol. He once remarked that everyone wants to be Cary Grant….I want to be Cary Grant. I bring this up because there is a company that rates well known people by how trustworthy they are and the top ten on the list are actors. This is a sad commentary on today’s culture when a fictitious person is considered more trustworthy than an actual person. It reminds of people who think that soap operas are real and send gifts to the characters portrayed in the show. This company is in the news because Brian Williams was number 28th on the list and after the lie he told on national TV he dropped to 865th. There is one group of people, that lying does not seem to adversely affect and that is, politicians, which is also sad. We don’t seem to mind when they lie because we expect them to lie and then we vote for them.

New benefits

There is a lot of controversy regarding President Obama’s changes toward undocumented immigrants and how they report earnings. Under current law they are issued an ITIN (individual taxpayer identification number) and they file taxes using that number. They are not eligible for tax credits. With the new rules they will be issued a social security number and will qualify for these benefits. Here is an example based on a tax return I just finished this week. A single mom age 23 with a 3 year old child. The Grandma babysits so this lady can work and she earned $13,600 last year and paid no federal or state income tax. Because she has a social security number she qualified for $3,305 from the earned income credit (EIC) and $1,000 from the child tax credit plus $1,040 from the MN working family credit. People who now have an ITIN will qualify for these benefits and will be allowed to refile the last three years and get these benefits. In this example this amounts to a windfall benefit of $21.360. These benefits are for single parents with one child who earn less than $44,000 per year. Having this SS number will qualify these individuals for disability benefits, retirement benefits and survivor benefits under the social security program. In addition there are a number of benefits under public assistance that now become available. These changes will provide benefits to low income people and will be paid for by either collecting more from higher earners or debt financing.