Category Archives: Government

The Social Contract

Social Contract

Last week I posted on the concept of the Social Contract.  Specifically on the fact that a contracts binds folks into reciprocal obligations – a quid pro quo if you will.  But rare is the liberal democrat that will agree with this simple obvious fact.

At its very core, the concept of a give and take is the argument the democrat makes; from each according to his ability, to each according to his need.  The idea that someone sits idly by while the rest of society labor for his largess SHOULD offend the liberal.

Alas, any debate that suggests those receiving ought to contribute as they can is met with labels of ‘hate’ and ‘bigot’.

As it stands, the US government spends north of $1 trillion annual on means tested welfare.  That’s a number even the most ardent Bernie supporter would find unbelievable – a massive transfer of wealth from those that have to those that have not.  In fact, if Bernie had been asked what his goal in such transfer programs were back in the 60’s, he would have been happy enough with that number to retire and call it a success.

Back to the contract.  What if we limited compliance of that contract not to those in need, caring for others and perhaps unable to care for themselves.  What if instead we went after those with no dependents and were fully capable of fending for themselves?

Poster BoyNotice: The poster child of this movement is neither female, a minority or destitute

Well, Maine did it – and it worked:

In response to the growth in food stamp dependence, Maine’s governor, Paul LePage, recently established work requirements on recipients who are without dependents and able-bodied. In Maine, all able-bodied adults without dependents in the food stamp program are now required to take a job, participate in training, or perform community service.

Job openings for lower-skill workers are abundant in Maine, and for those ABAWD recipients who cannot find immediate employment, Maine offers both training and community service slots. But despite vigorous outreach efforts by the government to encourage participation, most childless adult recipients in Maine refused to participate in training or even to perform community service for six hours per week. When ABAWD recipients refused to participate, their food stamp benefits ceased.

In the first three months after Maine’s work policy went into effect, its caseload of able-bodied adults without dependents plummeted by 80 percent, falling from 13,332 recipients in Dec. 2014 to 2,678 in March 2015.

Now THAT is a win!

Bernie Sanders And The Social Contract

Sanders Supporter

The Human Condition.

Liberals forget that the Human Condition is basically base.  At the core of it all, people tend to look after their own self interests.  Greedy?  Maybe.

But generally true and non-controversial.

And we see guys like Bernie Sanders extolling the Social Contract.  That agreement between the Haves [the State?] and the Have Nots that speaks to basic protections for the needy to stave off destitution.

We all know the responsibility of the 1% according to Sanders.  We know what he think ‘their fair share’ is.  But what  of the OTHER side of the contract?  The quid pro quo?  In return for such safety nets, what can society expect from those who seek such protection?

You see, after the 1% provide free food for the birds of the air there is always one Bernie dude that has to ruin the party for everyone and results in the Haves just walking away.

Walmart vs FEMA

Market Efficiency

Walmart every time.  Why?  Because, mostly Walmart is about selling things people want more than they are about retain power – which is what FEMA, and every government agency, is about.



“Commerce civilizes us.   It makes us more peaceful.  It makes us want to treat each other better.”


Too Much

Bad Government

Look, not all laws and government stuff is ‘bad’, but the amount of bad stuff out there is almost always due to ‘too much’.

For example, in what circumstance would a government care about patio plants?

MANKATO, MINN. — Marty Lewis, owner of Blue Bricks, 424 S Front St. in the City Center of Mankato was shocked to find that he had to close down the patio at Blue Bricks on Thursday, May 28th due to not having enough live plants.

“My managers told me that City of Mankato Associate Civil Engineer Landon Bode came into Blue Bricks on Thursday during lunch hour and told the servers that we did not have enough flowers on our patio and we were out of compliance with the City,” said Lewis “After the lunch crowd cleared, my managers went up to Drummers and picked up some shrubs, planters and hanging baskets and put them on the patio.”

Wanting to make sure Blue Bricks was in compliance, Lewis then called City of Mankato Associate Civil Engineer Landon Bode, who did not answer his phone and left a message.

“Landon Bode did not return my calls and I assumed that everything would be alright,” said a frustrated Lewis “Then at around 5:30 p.m. that day, two Mankato Police Officers came into the restaurant and told me that the patio was closed and we would have to clear the patio because we were out of compliance.”

Many things wrong with this picture, but two stand out:  One – Who thinks it is a governing bodies decision to dictate plant cover in a bar patio and Two – The enforcement of the rule is simply ludicrous.

Here We Go Again

Housing Bubble

As if it wasn’t bad enough that we suffered through one government induced housing bubble and then burst – we’re back at it:

WASHINGTON, DC – Today, Fannie Mae (FNMA/OTC) announced an option for qualified first-time homebuyers that will allow for a down payment as low as three percent. Building upon Fannie Mae’s successful lower down payment program offered through state Housing Finance Agencies, the 97 percent loan-to-value ratio (LTV) option will expand access to credit for qualified first-time homebuyers that may not have the resources for a larger down payment.  These loans will meet Fannie Mae’s usual eligibility requirements, including underwriting, income documentation and risk management standards. These loans will require private mortgage insurance or other risk sharing, as is required on purchase loans acquired by the company with greater than 80 percent LTV.

“Our goal is to help additional qualified borrowers gain access to mortgages,” said Andrew Bon Salle, Fannie Mae Executive Vice President for Single Family Underwriting, Pricing and Capital Markets.  “This option alone will not solve all the challenges around access to credit.  Our new 97 percent LTV offering is simply one way we are working to remove barriers for creditworthy borrowers to get a mortgage.  We are confident that these loans can be good business for lenders, safe and sound for Fannie Mae and an affordable, responsible option for qualified borrowers.”

Just as before, political pressure to move unqualified borrowers into homes is too much to resist.

Housing Bubble – Who Created It

Housing Bubble

Last year I posted on who I thought created the housing bubble:

There is no doubt that the housing crisis was caused by government policy.  Bad actors everywhere?  Sure.  But at the root of it all the was the government’s desire – by both parties – to increase home ownership in America.  And specifically for the poor and minorities.

There has yet to be evidence produced that would cause me to change my mind.  There is absolutely no question whatsoever that the administrations of Presidents going back to Jimmy Carter pursued the goal of home ownership in America – most specifically in the poor and minority populations.

The flip side to the “government created the bubble” is the “Wall Street’s greed created the bubble.”  The most vocal in my circle has been Scott Erb over at World inn Motion here and here:

The housing bubble and subsequent crisis was created by the big banks who were able to pull off the equivalent of a high stakes ponzi scheme and get away with it.

I’ve been going back and forth with Scott, and other wrong minded individuals about this as if it were a binary proposition.  Meaning that the answer was either I was right or “they” were right.

I’ve come to a different conclusion.  Namely, that while the government certainly was the trigger of the events that led to the crash, the whole thing still had to be set in motion with the people who would make and then sell the loans.

Consider – the government requires banks increase lending to people who have no hope of repaying those loans.  It stands to reason that the banks then go and meet the requirements.  This doesn’t change the fact that they were incented to make those loans and create the vehicles which facilitated those activities.

What might it take to create the case that this is the case?

  1. A bubble existed
  2. That government policy favored or desired homeowner ship among the poor and minority populations.
  3. That the government created conditions that either incented or required banks to increase these risky loans.
  4. That government assisted in this practice

If government passes a law that creates a disincentive to hire or retain employees, and then business reacts by firing or not hiring people it is BOTH true that government created the conditions that led to reduced employment AND that business acted out those policies – both Scott and I might be correct.

Wall Street may have enacted the policies but did so only due to government involvement.

IRS: Taregtting Conservatives And Liberals


IRS vs Bridgegate

I posted the difference in media coverage between the Chris Christie bridge scandal and the IRS targeting scandal.  I made the point that media coverage of the bridge scandal has dwarfed that of the IRS scandal in recent months.

In the comments nickgb called shenanigans base on the fact that the tails of a scandal are less covered than the beginnings of the scandal.

Full point.

Continue reading

Two Scandals: The Bridge And The IRS

Media Coverage.Bridge.IRS

Listen, I mentioned that government is coercion:

We allow ourselves to be governed in exchange for a certain degree of order.  We allow ourselves to be subject to the confiscatory practice of taxation in order to pay for that order, that law and order.

And we give power to men that we wouldn’t otherwise give.

Power corrupts – absolute power corrupts absolutely.

Continue reading

Commentary Income Gap And Private Social Security Accounts


One of the reasons that the income gap is widening is the impact of the gain in the stock market – wealthy Americans invest disproportionately in the market.  The less wealthy, for several reasons, don’t invest in the market.

Because of this, those wealthy Americans that DO invest in the market are seeing gains to their income due to the power of the stock market – the gains are flowing to the wealthy.

Consider this fact when reflecting on arguments AGAINST private investment accounts in place of social security*.  The idea that we reform social security away from the government trust fund to a privately held account that could be invested at the discretion of the individual.

The arguments against this plan is that it would expose the money to the vagrancies of the stock market and places the individual at too much risk.

This is very similar to the arguments presented by the liberal when it comes to the importance of money.  It goes something like this:

There is more to life than money, therefore a degree in Renaissance Art of Western Europe is valuable in its own right and a career in that field can offer a full and rewarding life.  The rich get richer and the poor get poorer – we need more redistribution of the money!

On the one hand, the argument states that money isn’t important and then becomes surprised when people who do value money have more of it than people who don’t value money.

The stock market is a massively effective method of building wealth.  Buying stocks during the recession, not selling, was responsible for astonishingly large gains for many many people.

If you care about income disparity, and we know that a large reason for this disparity is the market, how can you disagree with private social security accounts?

* I say this knowing full well that the REAL argument against private social security accounts is the same argument against Obamacare – Individual Liberty.  Social Security is nothing more than a mandate to save money and a private account would be no different than forcing  people to buy health insurance.

Who Shall Care For The Poor?

We should, of course: