Wednesday, July 8, 2009

Obama's Enron

I watched the 2005 documentary, "Enron: The Smartest Guys in the Room" last night and while I am nowhere near a financial analyist and therefore did not totally understand the ins and outs of it all (or the jargon), I did get something from it. I'm not really going to take the time to fully critique the documentary, though I did find one thing quite amusing. They began with mentioning, and demonstrating, the "deep" friendship of Ken Lay (Enron's founder and President) with the Bush family, and bookended the movie with darkly dramatic mention of the "lucky turn of events" when Ken Lay's "good friend" George W. Bush was elected President.

Not once, ever, did they mention that during most of the years of false growth and cooked books, Clinton was President. It was during these times, that some people began to get suspicious and nothing was done. Bush had only been in office a few months when Enron finally collapsed, and this documentary tried waaaaay too hard to make it look like Bush helped hide the scandal or had a hand in it somehow. It was pretty ridiculous. At the end I thought, well, why didn't the Clinton administration, while in control of regulatory agencies do anything? I don't know enough about the situation to claim that Bush had no connection to this, because I have no idea. All I'm doing is posing the question, where was the Clinton administration all those eight years, and why did the documentarians ignore this question?

Anyhow, my main point about this movie comes from an article at Michelle Malkin's blog today. Her article is about the frightening possibility that the administration and certain Democrats will try for another Porkulus bill. She happens to go over the GOP's report on the failures of the 1st Porkulus to do anything that its supporters claimed it would, especially in regards to jobs. I'll post a portion of the excerpts that she posted, because it reminded me of one of the key, if not the key, element of the Enron scandal.

According to the documentary, Enron's ability to cook the books for so long came from an SEC approved type of accounting called Mark to Market (MTM). It seems like this is a legitimate and commonly utilized method of accounting from what I could find out by doing some online research, but it also seems like it allows for fraud more easily. Again, according to the documentary, MTM allows a company to use possible future earnings as real-time value and assets. In this way, a business could propose a new venture, flamboyantly predict its own profits, and then simply add those predicted profits to their bottom line. Wa la! It now looks as though your company's profits have exploded, everybody's happy and making more money. In the case of Enron, even when those ventures went south, they counted those fantastical profits real profits. Turns out MTM also had a hand in the subprime mortgage crisis... Now, how does this relate to the growing Porkulus debacle? Here's how.

From the GOP's memo and via MM's article:
President Obama asserted on June 8 that stimulus spending would save or create 600,000 jobs over the subsequent 100 days. 9 The Administration has essentially “rigged the game” of reporting the tangible effects of its stimulus program by creating an immeasurable metric – “jobs created or saved” – that no one can disprove. [emphasis added]

In addition, OMB’s guidance includes a loophole that would allow prime recipients of Recovery Act funds to use statistical estimates to report aggregated project-level job numbers: However, in limited circumstances, the prime recipient can employ an approved statistical methodology to generate estimates of job impact, thereby collecting data from a smaller subset of sub-recipients and vendors in order to extrapolate an estimate of job impacts to all applicable sub- recipients and vendors. 15

This job reporting method is available when the recipient deems the project-level requirements to be “overly costly or burdensome.” 16 Given that every recipient has an incentive both to minimize the costs of reporting as well as to maximize the number of reported jobs “created or saved” (so as to be more likely to receive future Recovery Act funds), this loophole could lead to many recipients simply estimating job numbers in a way that is not auditable, much as the Administration has done so far with its macroeconomic job claims. [emphasis added]

Now, I'm not an expert, but it seems to me that if a large corporation uses a method of accounting that seems a little dubious to this financial neophyte, and allowed for astronomical fraud to occur because they could basically make up whatever they wanted to in terms of profits, then how is this similiar type of shady "estimation" and unsubstantiated prediction any better when the government does it regarding jobs "created or saved?"

I just couldn't help but notice the similarities between Enron's dizzying financial acrobatics, and the President's eerily similar circus act of just making stuff up about the economy and jobs, and wasting our money to do it. Just a thought.

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Also, check out the article that Michelle got her info from, it will make you want to move to Mars. Note to Dave Reichert: you should also read the article, then apologize to your country for voting for such rubbish.

Tuesday, July 7, 2009

4th of July Speech

This is the text of the speech I wrote and gave at the 4th of July Tea Party I attended.

Today I wanted to speak to you about principles. Ask yourself these questions: What principles do you hold? What do your principles mean to you? Are they important? How important are they?

It used to be, for me, that possessing the freedom and opportunity to create one’s way and wealth in the world, and keeping the fruits of one’s labor, was simply the most practical form a society could take. It was something that I took for granted. Now that this basic premise is being threatened on so many fronts, and I have had the chance to read and reflect, I realize, hopefully with time to spare, that this so-called “provincial” principle is the only moral path on which humanity can progress.

The absolute - oh yes, I said absolute, such a scary idea to a relativist - the absolute immorality of collectivism lies in its assumption that unfairness is the equivalent of injustice and that unfairness can be necessarily remedied by a benevolent arbiter. Here is a reality check. Life is unfair. It has always been such, and will always be in the future. Nature is not fair either. If you could, I would dare you to ask any animal who’s only goal is daily survival. Progress is supposed to mean an increase in the quality of life on a macroscale so that at the microscale individuals are free to work towards that increased quality. And there is a drastic difference between unfair and unjust. I ask you, what is more unjust than state fomented envy, and subsequently, state sanctioned and state enforced theft? I speak not only of the theft of material items, but the theft of one’s time, ideas, soul, spirit, blood, sweat, tears, legacy, charity... principles.

Have they succeeded in stealing your principles from you? From us? How much time do we have?

Are we or are we not a country that was founded on the revolutionary principle that a government’s sole purpose is to protect the liberty of each citizen so that they are free to prosper and create, without the fear that grips the citizens of either anarchical or tyrannical nations? Either we are a society that believes in, and protects, the rule of law and the individual as the smallest minority, or we are a society of tyrants and elites, and of serfs and slaves, in which some citizens toil under force for the benefit of the rest. And excuse my language, but I’ll be damned if that is the society for which my sister and brother-in-law, both new 2nd Lieutenants in the Washington Army National Guard, are fighting. I look at them and I see two brave, young soldiers; protectors of the principles that made this country the most successful, safe, peaceful, and prosperous country in all of history by defending the liberty and right of each person to toil for their own life. For their own family. For their own purposes. And it brings me back to my principles.

I think about how deeply I believe in my principles, and yet how afraid I have been, and still am to some extent, to proclaim them boldly and proudly, especially in this liberal/collectivist city of ours. I think about my sister and her husband and every other soldier, and I wonder, who am I to be afraid to confront my neighbor, my waitress, my coworker, my friend, my teacher, my boss? What is more important to me, living by and defending my principles, or ensuring my place in the social pecking order in my office or group of friends? Has anyone here ever kept quiet upon hearing disparaging remarks about, or misrepresentations of, values and principles you hold dear because you were with a group of people who held an opposing viewpoint and you didn’t want to rock the boat? Even once? Or maybe you received an email that did the same. Raise your hand. Keep your hands up and look around. We are an army and yet we behave as though we are only one.

I beg you to leave here today with a renewed committment to your principles. It is so hard, and you will need the support of like-minded people which means you need to get out there and meet them - like you are doing today. Exchange email addresses and go have coffee together! Make plans to get together for dinner or to write letters to Congress! Go to happy hour together! There are all sorts of groups of people out there that believe what you believe, really. Join one. Just look online. My saving grace was finding the Young Republicans, and there is something out there for you too. But please take this seriously, for if we do not fight this fight at the smallest level, at the person to person level, we will never be able to win it at the higher levels. This will also prepare you for activist opportunites like doorbelling and handing out flyers. You must be grounded in your principles so that no matter what the opposition says, they cannot shake you.

I leave you with this thought: how many times have you cursed the Republicans or Blue Dog Democrats, or Independents in Congress for not having a backbone to stand up to collectivist forces within our government, culture, and society? How many times have you felt like banging your head against the wall when they refuse to stand up against the pressure, the mainstream media, or Hollywood? Well, here it is folks, if you and I can’t even summon the courage to engage a friend in debate, why do we expect our Congressmen to do it, when the pressure on them to give in is ten times the amount it is for us? The lesson is that we keep the pressure on our elected officials, to stick to their principles, and we keep even more pressure on ourselves.

Thank you.

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My friend Jason just started a blog and posted a speech titled, The Cult of Need. He wrote it, and almost gave it on June 27th at a Tea Party in Olympia.

Monday, July 6, 2009

Bachman and Civil Disobedience

Via I Own the World, an incredible speech by Representative Bachman. I don't know much about her yet, but this piqued my curiosity so I will be researching her further.



Representative Bachman is also the legislator that announced she would not be answering any Census questions other than number of people in her household. Honestly, this is the type of civil disobedience I would love to see the Tea Party movement support. There is no reason for the government to know anything more than the size of the population. Think about it. The only reason for any of the of other stats are purely political. Some of them might be interesting, but not necessary. No, politicians want to know what group to pander to next, and which Balkanized groups they can exploit further. Interestingly, the Census doesn't seem to ask about citizenship, as though that doesn't matter. 

However, according to the Census website, the data, "... are used to distribute Congressional seats to states, to make decisions about what community services to provide, and to distribute $300 billion in federal funds to local, state and tribal governments each year." And yet they don't ask about citizenship??!! So illegals get to be counted and their numbers will aid in determining our Congressional distribution as well as disbursement of federal funds. That must completely fly in the face of sovereignty and our Constitutional rights as citizens and legal immigrants. I'm with Rep. Bachman on this one, and I think everyone should think about how they will be answering those Census questions come 2010.