Economic Policy: What Should We Have Done In 2009?

Government spending does not stimulate the economy because government is far less efficient than private enterprise. Tax rate cuts would stimulate the economy because they would reward productive investment with a better rate of return and ultimately put more resources in private hands. The crash of 2007-2008 was due to over leveraging. To unwind it, a lot of debt needed to be converted into equity. A couple of changes would encourage that. First would be to lower the capital gains tax rate to encourage more equity investment. Another thing that would be to make dividends tax deductible to corporations, just as interest payments are. This would remove the bias in favor of debt financing for private firms. The way to prevent too big to fail banks is to force them to have bigger capital reserves than small enough to fail banks. Dodd-Frank could be replaced by a simple rule that says that if the bank is larger than 1% or 2% of the overall banking assets of the United States it needs to have a 10% capital reserve. To make this a little easier, the law could allow banks to sell a special class of bonds that are convertible to equity in the event of regular capital reserves falling to zero. Regular capital reserves for big banks could be 5%, with the additional 5% coming from the convertible bonds. None of the banks that failed or were bailed out would have needed federal help if their capital reserves were this high. Big banks will dismantle themselves quickly to get away from high reserve requirements and the problem will be solved. Republicans should remember who Wall Street backs with political contributions and do the right thing on requiring big reserves from big banks.

http://www.nationalreview.com/article/395775/debating-economics-james-c-capretta

Recriminations Are Required on Vietnam War

I really can't stand the casual assumption that we were the bad guys in Vietnam. We left all of Indochina to its fate in 1975. The victorious Communists killed about 2 million Cambodians, and hundreds of thousands of other ethnic groups. Two million Vietnamese fled in leaky boats. There had never been any such mass exodus from Vietnam before. Ten to a hundred times more people died after we left than died during the war. I was in Air Force ROTC from 1968-1972 and on active duty from 1972-1976. In college arguments, I always said that if we lost there would be a bloodbath. It was obvious after the Tet Offensive. The Viet Cong left several mass graves of thousands of men, women and children that they executed. The Vietnamese knew about it, but it was not widely reported in the US. Anybody who took the time to look into it could have easily predicted the subsequent mayhem. Here it is 40 years later and the anti-war left has yet to even notice the havoc they unleashed, let alone apologize for it. The willful ignorance is so bad that our Secretary of State, who testified under oath to Congress that Americans commonly committed war crimes in Vietnam, gets a pass for his obvious perjury and is appointed to the highest level cabinet level post in the federal government.

What about war crimes in Vietnam?  The Vietnam War Crimes Working Group was a Pentagon task force set up to investigate.  They found 320 substantiated cases. At the height of the war, there were over 500,000 American troops in Vietnam. This number of war crimes were a low productivity hour or two for Pol Pot and the Khmer Rouge in Cambodia.  American war crimes were hardly as common as John Kerry testified they were.  He lied.

I think that the post WWII policy of trying to contain communism made the Vietnam War almost unavoidable. I agree that the stated objectives of Kennedy and Johnson did not include stopping the killing that accompanied any communist takeover of any country. However, the anti-war protesters loudly proclaimed that they wanted to stop the killing as one of their major slogans. I heard them loud and clear, up close and personal. They claimed that the killing would stop if the US withdrew from Southeast Asia. The actual outcome did not match their stated goals at all. Worse, the "Peace Movement" didn't even bother to look to see the damage the withdrawal actually did. They patted themselves on the back for making "peace" and went on to their next causes with enthusiasm. They took no notice of the fact that they facilitated massive slaughter. When peacenicks look back, it's with nostalgia for the righteousness of their cause.  They are oblivious to their actual results.  And they are running US foreign policy today with the same disastrous results in Syria, Iraq and Nigeria.

Vietnam War Crimes Working Group link:

http://en.wikipedia.org/wiki/Vietnam_War_Crimes_Working_Group

Putin at a "Goodfellas" Moment?

I am hoping that Putin is approaching a "Goodfellas" moment with his oligarchs. Putin's Ukrainian adventures have brought unwanted heat from the West on the enterprises of kleptocratic Russia. All of Russia's big companies have a lot of short term debt they will find almost impossible to refinance due to sanctions and falling oil and natural gas prices. If the oligarch's companies can't refinance, they will default on the loans and won't be able to do business in the West because any assets they have there or send there will be attached to pay what they owe. It's even possible that the oligarchs' personal assets could be seized to pay their companies' debts as part of future sanctions. In 1999, the corruption charges against the government threatened the oligarchs and Putin's Chechen War helped them avoid trouble. This time, the sanctions and falling oil and natural gas prices threaten the oligarchs, and the Ukraine War made things worse. Analyzing it like a crime family would, the oligarchs may decide it's time for Putin to end up floating in the Volga river. 

Small Ball is the Way to Beat The One

Like a lot of other Conservatives, I was a little disappointed that we didn’t raise slightly more fuss about our Dear Leader’s efforts to make law without Congress.  However, I think the small ball concessions we imposed for the Continuing Resolution is the way to win against the One Not Quite All of Us Were Waiting For.  Small ball puts our Dear Leader on ground he can't hold because he has no attention span and no patience.  His teleprompter tactics are geared towards lying about a few big issues and getting low information voters to believe the lies.   His backers in the Pravda Press are also geared to attacking on a few big issues, like the mythical war on women and the fabricated "hands up, don't shoot."  So forcing the Chicago Machine Prodigy to fight down in the weeds against individual department funding bills festooned with all sorts of riders and budget cuts is exactly how to maneuver him out of his trenches without going over the top into massive machine gun fire from the teleprompter and the MSM repeaters.  A billion here, a billion there is big money whether you're spending or cutting.  Also, technical things, like eliminating the current services baseline budget calculation, can make a big difference and yet be inexplicable to voters, so they can't be vetoed.  

Please excuse my mixed metafors,  Perhaps you should view them as a metaphor smoothie..