Browsing the blog archives for August, 2012.

Romney-Ryan

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Having been critical of Mitt Romney in the past, I am frequently asked about my views of Romney as a presidential candidate, and more recently the Romney-Ryan ticket. I’ve received a few emails lately prompting a response on the blog.

Those who support Romney-Ryan tout Romney’s experience as a business leader. Paul Ryan adds a passion for reform, knowledge about the budget, strong communication skills, and solid conservative credentials. This ticket is more focused and reform-oriented than McCain-Palin. Obama has been a disaster, and Romney has a real opportunity to turn things around.

But others see things differently. Conservative-minded detractors don’t attack Romney’s character per se, but point out his lack of consistency on a number of key issues. Ryan’s passion and knowledge notwithstanding, his proposals don’t go far enough. Romney-Ryan might be better than Obama-Biden, but we’d still be headed for the cliff, albeit at a slower pace.

Consider that Ryan’s Medicare reform proposal would make no changes for anyone 55 or older. They’ve paid into the system and have planned their retirements around Medicare, so I understand the point here. However, the Medicare trustees tell us that the program will go bankrupt by 2016 if you exclude Obama’s double-counting. Even if actuary Richard Foster is off by a few years, this would happen before any reform takes place. Those on the left who characterize Ryan’s plan as draconian are burying their heads in the sand. To be frank, an ideal solution would be much more aggressive.

Our nation has declined precipitously since Obama’s election, but we must admit that he is not entirely responsible for the current state of affairs. We didn’t get to a $16 trillion debt overnight and we won’t get ourselves out of it rapidly either. In my view, Romney-Ryan appear to be offering a legitimate move in the right direction. It may not be as far as we need to go, but it could be the first step. Moreover, IF Romney wins AND he gets (real) conservative majorities in both houses, then we MIGHT see more aggressive proposals. There are no guarantees here, but consider the alternative.

Many of today’s so-called conservatives seem more like moderates and most fail to understand the seriousness of the current economic challenges. I’m not entirely optimistic about the fiscal future of our nation and I’m not sure what we would get from a President Romney, but four more years of Obama might be more that our nation can handle.

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GM vs. Medicare

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Someone must pick the winners and losers in an economy. The marketplace always does a better job than government–especially over the long term–but Washington refuses to get the message.

Consider GM. When the carmaker was headed for reorganization through bankruptcy, President Obama had a better idea. Rather than let the process take its course and force the UAW to reorganize its contracts, the administration decided to mandate its own solution. Although the President touts “saving GM” as a huge success, taxpayer losses in the tens of billions are forgotten. Meanwhile, GM struggles to sell Volts even with taxpayer subsidies, and the firm is planning to produce more cars outside of the United States in the coming decade. So much for saving American jobs.

Now consider Medicare. The President shifted $716 billion from “waste, fraud, and abuse” in the behemoth to help finance Obamacare. However, according to Medicare’s chief actuary, these cuts will–among other things–make 15% of hospitals serving Medicare patients unprofitable. When asked about healthcare providers going out of business as a result, administration officials claim that such providers are just inefficient. Put another way, it’s not government’s fault if private firms cannot survive price controls.

It seems that Obama wants it both ways. When GM is unable to deal with market pressures, the President sees nothing wrong with intervening to dictate the terms to reorganization. When healthcare providers struggle with government pressures, they must either adapt or dissolve. The underlying assumption is that markets are inherently evil and unfair, while government is the lone source of justice for the common man. Of course, there’s also political gain in propping up the unions in the name of “saving GM,” as well as beating up physicians, big pharma, and other players in the healthcare arena, many of whom are presumed to be part of “the 1%.” It’s all about government control.

Welcome to the new economy. Free markets have been replaced by a mix of Marxism, fascism, and populism.

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Enter Paul Ryan

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The Democrats started attacking Paul Ryan minutes after Mitt Romney selected him as the VP candidate. They are focusing on Ryan’s budget proposals which–if you listen to them–will starve everyone from children to seniors while the rich like Romney aren’t required to pay their “fair share.” Their narrative is told through various ads and cliches, but their argument is simple:

1. Those who achieve wealth through business pursuits are inherently crooked. (athletes, actors and liberal politicians are exceptions)

2. Because Mitt Romney achieved wealth through business pursuits, he is crooked. (those like Warren Buffett and Jeff Immelt who play along with the government are exempt)

3. Romney’s selection of Ryan reinforces the above because Ryan is willing to cut spending to deal with the coming fiscal catastrophe.

4. Romney is protecting the top 1% and fails to acknowledge that the current financial malaise could be readily solved if only the wealthy “contributed” a little more.

While this argument fails to recognize that the private sector funds the government in the first place, there is a deeper issue here. Runaway government spending is a serious problem and the piper will be paid one day if we do not reform Washington. Serious cuts must be part of that reform. Raising taxes on the “rich” ignores the fact that top wage earners already pay most of the taxes anyway and the gap is far to great to be closed without substantial spending reductions. There is no rational argument to avoid this reality. Obama’s retort only strikes a chord on the emotional level.

Enter Paul Ryan. He’s a pragmatic conservative. He’s bright, understands the issues, and has been willing to put serious ideas on the table. I don’t agree with everything he has proposed, in short because I don’t think he goes far enough. But those on the left oppose his budget proposal because it goes too far. Ryan deserves massive credit for addressing the problem head-on, and his addition to the ticket exposes a core problem with the Obama administration: They have no serious alternative. The numbers just don’t add up.

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