Government – Page 117 – artdiamondblog.com

Federal Government Spending Soars

Source of graph: online version of the WSJ article quoted and cited below.

(p. A17) This has been an unforgettable year in the history of American spending.

It began with an eye-popping $800 billion stimulus bill that came from nowhere and went to nowhere. Done with that, the Washington Democrats turned to President Obama’s health-care reform, which looked big at first, but turned out to be bigger. A well-publicized June estimate of the Senate bill’s cost by the Congressional Budget Office put the 10-year price tag at $1.6 trillion. So $800 billion, then a trillion.
Dollar signs rocketed into the sky all year: hundreds of billions on various TARP salvage projects, much drawn from some magic stash held by the Federal Reserve. The Obama cap-and-trade bill was going to use an auction to siphon $3.3 trillion from various states to Washington over 40 years. Oh, almost forgot–an FY 2011 $3.8 trillion budget.

For the full commentary, see:

DANIEL HENNINGER. “It’s the Spending, America .” The Wall Street Journal (Thurs., February 18, 2010): A17.

Arnold on Ben Nelson’s Cornhusker Kickback: “He Got the Corn; We Got the Husk”

(p. A16) Senator Ben Nelson, Democrat of Nebraska, has been under fire in recent days for winning some plum provisions for his home state in exchange for voting for his party’s big health care legislation.
. . .
In perhaps the most pointed criticism yet, Gov. Arnold Schwarzenegger of California, in his State of the State address on Wednesday, said: “California’s Congressional delegation should either vote against this bill that is a disaster for California or get in there and fight for the same sweetheart deal Senator Nelson of Nebraska got for the Cornhusker State. He got the corn; we got the husk.”

For the full story, see:
DAVID M. HERSZENHORN. “Prescriptions; Making Sense of the Health Care Debate; Spreading the Golden Corn.” The New York Times (Fri., January 8, 2010): A16.
(Note: the online version of the story had the very different title: “Prescriptions; Making Sense of the Health Care Debate; Nelson to Fight for All States” and had the date January 7, 2010.”)
(Note: ellipsis added.)

Thousands Waited Hours in Subzero Cold Trying to Enter Global Warming Conference (“This Is What UN Efficiency Looks Like”)

(p. A10) As dozens of developing countries threatened to walk out of the Copenhagen climate-change summit, thousands of NGOs, journalists, lawyers, activists were still trying to get in.

The thousands queued from the early morning into the afternoon on Monday to register for the summit but found themselves in a line that barely budged for most of the day. Only those who already had accreditation — obtained during the first week of the summit or over the weekend — were let in; the rest braved subzero temperatures for some glimpse of a breakthrough.
Would-be attendees chanted “Let us in!” to Danish policemen ringing the Bella Center.
United Nations officials announced at one point that the process of accreditation would stop at 6 p.m. today, prompting boos and catcalls and cries of “shame” from those in line. One sign declared: “This is what UN efficiency looks like.”

For the full story, see:
Guy Chazan. “Copenhagen Dispatches; Some Walk Out of Gathering, But Many More Want In.” The Wall Street Jounal (Tues., December 15, 2009): A10.
(Note: the online version of the commentary had the title “Thousands Line Up for Climate Conference” and the date December 14, 2009.)

The “Bongo System” of Corruption in Gabon: More on Why Africa is Poor

“The image of Ali Bongo, the son of longtime ruler Omar Bongo, blanketed Libreville.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A5) The “Bongo system,” as people here refer to it — forsaking roads, schools and hospitals for the sake of Mr. Bongo’s 66 bank accounts, 183 cars, 39 luxury properties in France and grandiose government constructions in Libreville — is etched in the streets of this languid seaside capital, where he ruled for 41 years, and also in the minds of its inhabitants.
. . .
A Western family here spoke of embarrassment at visiting a government minister whose house is packed with the latest flat-screen televisions and other expensive electronic gadgets, and whose garage was full of luxury cars. The top aide to a leading opposition figure, discussing the “Bongo system,” said: “You had to bring a suitcase to the palace. Bongo didn’t write checks.” The president, he said, “calls everybody to the palace, and the money is handed out. That’s how the country was run.”
He spoke of a “sandwich system” of vote-buying employed by the ruling party in rural districts: notables are called together for a meeting, and at the end, when all are tired, a tray of “sandwiches” is passed around. Inside each “sandwich” is up to $600.
Looking around at an outdoor restaurant, he asked not to be named because he said: “It’s a police state. They mess up your life.”
. . .
On paper, the government’s budget allocations for health, education and transportation were impressive, “huge,” said the Western development official. “But in reality, it was actually about 20 percent of what was on paper,” the official said. “The rest was embezzled,” he added, asking to remain anonymous because identifying him would complicate his work in the country.
. . .
“It’s a tiny number that benefits from the country’s riches,” said a cigarette vendor, Price Nyamam, squatting on the pavement in the poor Rio district. He said he had degrees in economics and sociology. “You are obliged to do work that doesn’t correspond to your aspirations.”

For the full story, see:
ADAM NOSSITER. “Libreville Journal; Underneath Palatial Skin, Corruption Rules Gabon.” The New York Times (Tues., September 15, 2009): A5.
(Note: the online version of the article has the date September 14, 2009.)
(Note: ellipses added.)

“Foraging for food at the main dump.” Source of caption and photo: online version of the NYT article quoted and cited above.

Chinese Subsidies Create Unprofitable Overcapacity and Risk of Crisis

(p. 5) . . . subsidies, . . . , have spurred excess capacity and created a dangerous political dynamic in which these investments have to be propped up at all cost.

China has been building factories and production capacity in virtually every sector of its economy, but it’s not clear that the latest round of investments will be profitable anytime soon. Automobiles, steel, semiconductors, cement, aluminum and real estate all show signs of too much capacity. In Shanghai, the central business district appears to have high vacancy rates, yet building continues.
. . .
Over all, there is a lack of transparency. China’s statistics on its gross domestic product are based more on recorded production activity than on what is actually sold. Chinese fiscal and credit policies are geared toward jobs and political stability, and thus the authorities shy away from revealing which projects are most troubled or should be canceled.
Put all of this together and there is a very real possibility of trouble.

For the full commentary, see:
TYLER COWEN. “Economic View; Dangers of an Overheated China.” The New York Times, SundayBusiness Section (Sun., November 29, 2009 ): 5.
(Note: the online version of the commentary has the date November 28, 2009.)
(Note: ellipsis added.)

Socialist Chavez’s Thugs Destroy Venezuelans’ Economic Freedom

“A member of the National Guard stands guard during a inspection of prices at a store in La Guaira outside Caracas Jan. 12.” Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. A8) CARACAS — President Hugo Chávez’s decision to devalue Venezuela’s currency in order to shore up government finances could backfire on the populist leader if the move leads to substantially higher prices and extends an economic downturn.

Just days after Mr. Chávez cut the value of the “strong bolivar” currency, some businesses were marking up prices. Shoppers jammed stores to stock up on goods before the increases took hold.
Amelia Soto, a 52-year-old housewife waited in line at a Caracas drugstore to buy 23 tubes of toothpaste. “Everywhere I hear that prices are going to skyrocket so I want to buy as much as I can now,” she said.
Airlines have doubled fares; government officials said they were looking into reports that large retail chains were also increasing prices.
. . .
The price increases are setting the stage for confrontations with authorities following Mr. Chávez’s orders to shut down retailers that raise prices.
. . .
The higher prices for consumer goods represent a huge liability for a country facing 27% inflation, one of the highest levels in the world.

For the full story, see:
DARCY CROWE and DAN MOLINSKI. “Prices in Venezuela Surge After Devaluation.” The Wall Street Journal (Weds., JANUARY 13, 2010): A8.
(Note: the online version of the article has the title “Venezuelans Rush to Shop as Stores Increase Prices.”)
(Note: ellipses added.)

“Conservation Is About Managing People,” Not Wildlife

(p. C27) People are hard-wired to be fearful of large carnivores. What’s more, it’s hard for the poor to see the economic advantage of rewilding. Humans don’t like conservationists telling them what they can and can’t do with the land that surrounds them. As one conservationist counterintuitively points out to Ms. Fraser: “Conservation is about managing people. It’s not about managing wildlife.”

For the full review, see:
DWIGHT GARNER. “Books of The Times; Conservation as a Matter of Managing People.” The New York Times (Fri., January 22, 2010): C1 & C27.
(Note: the online version of the article is dated January 21, 2010.)

The book under review, is:
Fraser, Caroline. Rewilding the World: Dispatches from the Conservation Revolution. New York: Metropolitan Books, 2009.

Chinese Economic Crisis Predicted by Investor Who Predicted Enron Collapse

“James Chanos made his hedge fund fortune predicting problems at companies and shorting their stock.” Source of caption and photo: online version of the NYT article quoted and cited below.

Chanos’ views discussed below are plausible and worth taking seriously. Earlier and overlapping worries about the sustainability of China’s boom were expressed in a credible and scary book by David Smick called The World is Curved.
In addition to some of the concerns expressed by Chanos, Smick also emphasizes that China’s restrictions on the internet will dampen the ability of its entrepreneurs to succeed. That view seems prescient given China’s growing attempts to censor the internet and to hack Google.

(p. B1) SHANGHAI — James S. Chanos built one of the largest fortunes on Wall Street by foreseeing the collapse of Enron and other highflying companies whose stories were too good to be true.

Now Mr. Chanos, a wealthy hedge fund investor, is working to bust the myth of the biggest conglomerate of all: China Inc.
As most of the world bets on China to help lift the global economy out of recession, Mr. Chanos is warning that China’s hyperstimulated economy is headed for a crash, rather than the sustained boom that most economists predict. Its surging real estate sector, buoyed by a flood of speculative capital, looks like “Dubai times 1,000 — or worse,” he frets. He even suspects that Beijing is cooking its books, faking, among other things, its eye-popping growth rates of more than 8 percent.
“Bubbles are best identified by credit excesses, not valuation excesses,” he said in a recent appearance on CNBC. “And there’s no bigger credit excess than in China.” He is planning a speech later this month at the University of Oxford to drive home his point.
. . .
(p. B4) . . . he is tagging along with the bears, who see mounting evidence that China’s stimulus package and aggressive bank lending are creating artificial demand, raising the risk of a wave of nonperforming loans.
“In China, he seems to see the excesses, to the third and fourth power, that he’s been tilting against all these decades,” said Jim Grant, a longtime friend and the editor of Grant’s Interest Rate Observer, who is also bearish on China. “He homes in on the excesses of the markets and profits from them. That’s been his stock and trade.”
Mr. Chanos declined to be interviewed, citing his continuing research on China. But he has already been spreading the view that the China miracle is blinding investors to the risk that the country is producing far too much.
“The Chinese,” he warned in an interview in November with Politico.com, “are in danger of producing huge quantities of goods and products that they will be unable to sell.”

For the full story, see:
DAVID BARBOZA. “Shorting China: the Man Who Predicted Enron’s Fall Sees a Bigger Collapse Ahead.” The New York Times (Fri., January 8, 2010): B1 & B5.
(Note: the online version of the article has the title “Contrarian Investor Sees Economic Crash in China” and is dated January 7, 2010.)
(Note: ellipses added.)

The reference to the Smick book is:
Smick, David M. The World Is Curved: Hidden Dangers to the Global Economy. New York: Portfolio Hardcover, 2008.

“Now Mr. Chanos is betting against China, and is promoting his view that the China miracle has blinded investors to the risks in that economy.” Source of caption and poster: online version of the NYT article quoted and cited above.

Washington’s Influence Business is “Booming” Though Fewer Register as Lobbyists

(p. A1) WASHINGTON — Ellen Miller, co-founder of the Sunlight Foundation, has spent years arguing for rules to force more disclosure of how lobbyists and private interests shape public policy. Until recently, she herself registered as a lobbyist, too, publicly reporting her role in the group’s advocacy of even more reporting. Not anymore.

In light of strict new regulations imposed by Congress over the last two years, Ms. Miller joined a wave of policy advocates who are choosing not to declare themselves as lobbyists.
“I have never spent much time on Capitol Hill,” Ms. Miller said, explaining that she only supervises those who press lawmakers directly. “I am not lobbying, so why fill out the forms?”
Her frankness makes Ms. Miller a standout among hundreds of others who are making the same decision. Though Washington’s influence business is by all accounts booming, a growing number of its practitioners are taking a similar course to avoid the spotlight of public disclosure.
“All the increasing restrictions on lobbyists are a disincentive to be a lobbyist, and those who think they can deregister are eagerly doing so,” said Jan Baran, a veteran political lawyer who has been fielding questions from clients hoping to escape registration. “It is creating some apparent contradictions.”
. . .
(p. A12) But for all its penalties, the law left the definition of a lobbyist fairly elastic. The criteria included getting paid to lobby, contacting public officials about a client’s interests at least twice in a quarter and working at least 20 percent of the time on lobbying-related activities for the client.
Enforcement is also light. Lobbyists suspected of failing to file receive at least one official letter offering a chance to rectify their status before any legal action is taken.
After the rules changed, private companies and nonprofit groups immediately began to rethink their registration.
The Union of Concerned Scientists, which advocates on arms control, energy policy and environmental issues, had previously registered almost anyone who went to Capitol Hill on its behalf, said Stephen Young, a senior analyst for the group. That changed after the new law.
“We thought: ‘Hmm, this is now not such an easy thing. Let’s see if we are required to do it. We are not? Let’s take them off,’ ” he said. The group terminated the registrations of “virtually all” its former lobbyists, he said.

For the full story, see:

DAVID D. KIRKPATRICK. “Law to Curb Lobbying Sends It Underground.” The New York Times (Mon., JANUARY 18, 2010): A1 & A12.
(Note: the online version of the article is dated January 17, 2010.)
(Note: ellipsis added.)

Grumpy Forecaster Bites Pushy Politician

“Will there be six more weeks of winter? Will Chuck mind his manners at the Staten Island Zoo? Will Mayor Michael R. Bloomberg pull this stunt again? The answers are uncertain. It is clear, though, that the mayor can be persistent in the face of hostility.” Source of the caption and the photo: online version of the NYT article quoted and cited below.

(p. A20) There are creatures — hibernating bears come to mind, or emergency-room doctors after an overnight shift — who don’t appreciate being roused from their slumber. Perhaps that’s what irked Chuck the Groundhog on Monday morning on Staten Island when Mayor Michael R. Bloomberg tried to lure him out of his wooden shelter.

Chuck wasn’t up for whatever it was that Mr. Bloomberg had planned for him — or for predicting how much longer winter was going to last, for that matter. And he got so annoyed at the mayor that he bit the mayor’s left hand, his sharp teeth piercing Mr. Bloomberg’s black leather gloves.
One can argue that Mr. Bloomberg sort of asked for it. As cameras rolled and the crowd took in the event — a local imitation of the Punxsutawney Phil tradition — Chuck at first refused to come out. Children chanted his name to no avail. Mr. Bloomberg seemed to realize that the reclusive rodent was spoiling the show.
He tried to lure Chuck out of his cottage with an ear of corn, but Chuck shrewdly grabbed the corn and dragged it inside to enjoy. The mayor tried again, twice, but then, seemingly out of patience, he grabbed Chuck by the belly with both hands before he could hide again and held him up in the air for everyone to see.
By then, the mayor had already been bitten.

For the full story, see:
FERNANDA SANTOS. “Reclusive Staten Islander Bites Mayor.” The New York Times (Tues., February 3, 2009): A20.
(Note: the online version of the article has the slightly different title: “Reclusive Staten Island Groundhog Bites Mayor.”)

TSA Hassles Cub Scout Mikey Hicks Who is 8 Years Old

“Michael Hicks, 8, a Cub Scout in Clifton, N.J., has the same name as a suspicious person.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A1) The Transportation Security Administration, under scrutiny after last month’s bombing attempt, has on its Web site a “mythbuster” that tries to reassure the public.

Myth: The No-Fly list includes an 8-year-old boy.
Buster: No 8-year-old is on a T.S.A. watch list.
“Meet Mikey Hicks,” said Najlah Feanny Hicks, introducing her 8-year-old son, a New Jersey Cub Scout and frequent traveler who has seldom boarded a plane without a hassle because he shares the name of a suspicious person. “It’s not a myth.”
Michael Winston Hicks’s mother initially sensed trouble when he was a baby and she could not get a seat for him on their flight to Florida at an airport kiosk; airline officials explained that his name “was on the list,” she recalled.
The first time he was patted down, at Newark Liberty International Airport, Mikey was 2. He cried.
After years of long delays and waits for supervisors at every airport ticket counter, this year’s vacation to the Bahamas badly shook up the family. Mikey was frisked on the way there, then (p. A3) more aggressively on the way home.
“Up your arms, down your arms, up your crotch — someone is patting your 8-year-old down like he’s a criminal,” Mrs. Hicks recounted. “A terrorist can blow his underwear up and they don’t catch him. But my 8-year-old can’t walk through security without being frisked.”

For the full story, see:
LIZETTE ALVAREZ. “Meet Mikey, 8: U.S. Has Him on Watch List.” The New York Times (Thurs., January 14, 2010): A1 & A3.
(Note: the online version of the article is dated January 13, 2010.)
(Note: italics in original.)