A journalist just asked the president whether charities are wrong when they say that reducing the charitable contribution deduction for the wealthy (i.e. those with enough money to give away) will reduce the incentive to donate to charities.
No, no it doesn’t reduce the incentive, he said.
His answer to that question was no less willfully ignorant than those who deny evolution or insist the earth is flat. The difference, of course, is that a president has never asserted that he should be able to take over science departments or mapmakers. This president has asserted that he should be able to take over any company he feels like. And he gets on prime time television and flat out asserts that the most fundamental law of economics – incentives matter – is wrong.
This man is a walking argument for small government. The smaller the government, the less damage the idiots in charge can do. The larger the government, the more control economic illiterates have over the economy.
QUESTION: It’s not the well-to-do people. It’s the charities. Given what you’ve just said, are you confident the charities are wrong when they contend that this would discourage giving?
OBAMA: Yes, I am. I mean, if you look at the evidence, there’s very little evidence that this has a significant impact on charitable giving.
Incentives don’t matter. There’s not even an acknowledgement here that, “Yes, it may discourage some giving, but I think the gains in tax revenue are worth it.” There’s just an assertion that the laws of economics don’t apply here.
I don’t know how reputable a site Newshounds is (although judging by their slogan I’m going to guess, not very), but the video clip at the end is damning enough.
Not only is Ingraham a horrible person, she gives conservatives a bad name with her intellectually substandard performances on both radio and televison.
How the hell did this woman get into such a position?
President Obama does send his greetings, though. He can’t be here tonight — because he’s busy getting ready for Easter. [Whisper] He thinks it’s about him.
Congressmen like Barney Frank are playing with fire. Populism is an explosive force because angry people are very likely to take out their wrath on the wrong target, much like a whipped dog attacking its own sides rather than the whip. The AIG bonuses seem egregious, but congress is only adding fuel to the fire when they stoke fury. Mona Charen observes that:
the most sinister move came from Barney Frank. He demanded that Liddy reveal the names of the 73 executives who had received retention bonuses. Liddy said he would so if he could receive a promise of confidentiality. Frank refused and threatened to subpoena the names. Liddy said if subpoenaed he would obey the law, but he then read to the committee some of the death threats his company had been getting over the past few days. Some threats spoke of hanging the executives with piano wire, others of finding where their kids went to school.
That is the sort of ugliness and criminality that Frank is willing tacitly to encourage by demanding the names. And for what? The bonuses amounted to just one-tenth of one percent of the AIG bailout (to say nothing of the stimulus bill and the gargantuan budget bill Congress and the president are hanging around our necks). If politicians want to metaphorically flay away at evil businessmen, well that’s regrettable. But when they cross the line into encouraging the targeting of actual individuals, they are no longer “honorable gentlemen,” but leaders of a mob.
Krauthammer explains why congress’s actions are very likely unconstitutional and short-sighted:
And there is such a thing as law. The way to break a contract legally is Chapter 11. Short of that, a contract is a contract. The AIG bonuses were agreed to before the government takeover and are perfectly legal. Is the rule now that when public anger is kindled, Congress will summarily cancel contracts?
Even worse are the clever schemes being cooked up in Congress to retrieve the money by means of some retroactive confiscatory tax. The common law is pretty clear about the impermissibility of ex post facto legislation and bills of attainder. They also happen to be specifically prohibited by the Constitution. We’re going to overturn that for $165 million?
And Linda Chavez both makes the case that many of the people at AIG actually deserve their bonuses and identifies the root of the real problem here in human nature:
When a company is collapsing — as AIG certainly was at the time these contracts were negotiated — everybody who has an alternative is looking to jump ship. Think about it. If you knew that your employer might not be around in a few months and you had very specialized skills that were much in demand elsewhere, would you be willing to go down with the ship? Not likely. But if your employer offered you a handsome financial incentive to stick around, you’d be far more likely to take the risk. Well, that’s exactly what AIG did when it negotiated retention bonuses.
But what about the people, who received those bonuses, that had already left the company? It’s legitimate to question whether those bonuses are deserved, but it’s ridiculous to jump to the conclusion they aren’t based solely on the information we currently have.
It depends on the circumstances surrounding their departures. If they just up and quit, leaving the company in the lurch, they aren’t entitled to the bonus. But my guess is that most of them left because the company decided it was in its interest either to eliminate the job or replace the individual with someone else. In that case, barring demonstrable fault on the part of the individual, the company would be obligated to pay the amount that had been promised when the employee agreed to stay on.
So if it’s not the principle of retention bonuses that infuriates people, what is it? It’s anger that the people who received these bonuses are greedy. But greed isn’t the only destructive vice out there. What’s driving public outrage right now is another unattractive vice: envy. Neither vice is healthy.
Class envy won’t put a single penny in anyone’s pocket. It won’t save jobs. It certainly won’t solve the credit crisis. And the irresponsible rhetoric from politicians will make it less likely that we will solve the real problems confronting the nation.
We’ve already had Sen. Charles Grassley suggest failed company executives ought to commit hari-kari — which he retracted later — and Rep. Barney Frank seemed perfectly happy to have AIG executives who received bonuses identified publicly even if it jeopardized their security. If this keeps up, it could turn really ugly. Mobs are difficult to control once they’ve been unleashed. But don’t expect any of the rabble-rousers on Capitol Hill or in the White House to take responsibility if things turn violent.
First we have complicated but perhaps justifiable reasons for bonuses. Second we have congressmen stirring up outrage in a matter that might shred constitutional guarantees against ex post facto laws. Third, we have a situation where this simplified narrative may prevent us from needed reforms, as Kim Strassel explains:
This spectacle has left the financial community with one impression: Stay away. What healthy bank, what hedge fund, what private equity firm wants to take part in an Obama plan to sell off toxic assets, or to revive consumer lending, with the knowledge that they might be Washington’s newest bonfire? Executives are already working to get out of TARP, fearful of political punishment. This despite a recession, falling house prices and growing bank losses.
As it happens, the administration has suggested the banks might need yet more public capital, not less. But just who in Congress is today prepared to vote to provide more funding, with greedy AIG on the public mind? It’s too busy passing laws to levy 90% taxes on bank employees everywhere.
Washington does have its grown-ups: Those few Republicans who tried for years to reform Fannie and Freddie, but who also voted for a necessary banking rescue; those in Congress who have tried to explain that the goal is not to bail out bankers, but to bail out ourselves; those very few who have stood up to remind Americans that — as distasteful as some Wall Street bonuses have appeared — it is far more pernicious for Washington to start setting salary caps. Sadly, their reward for political courage has been to be labeled as stooges of . . . greedy Wall Street.
That’s right. Washington has its story, and it’s sticking to it. Perhaps to the bitter end.
H.L. Mencken seems appropriate to quote here: “Democracy is the theory that the common people know what they want, and deserve to get it good and hard.”
Deroy Murdock deserves worlds of kudos for his excellent column contrasting the marriage lobby’s obsession with SSM and obliviousness to AshleyMadison.com, a hook-up site for adulterers:
AshleyMadison.com calls itself a “dating site specifically designed to help married people cheat on their spouses.” Its slogan is “Life’s short, have an affair.” Its previous tag line was “When Monogamy Becomes Monotony.” It boasts 3.5 million registered users, among whom some 400,000 active members each pay up to $249 quarterly.
…
Over the last six months, for example, Rick Santorum appeared in 22 stories that mention “gay marriage,” but in zero citing AshleyMadison.com. Maggie Gallagher materialized in 41 gay-marriage stories and zero on AshleyMadison.com. Former Massachusetts governor Mitt Romney’s numbers are 276-0, respectively. For Focus on the Family, the score is 389-0. The phrase “same-sex marriage” yielded 24 hits for Santorum, 52 for Gallagher, 256 for Romney, and 449 for Focus. All of the above were absent from the 67 Nexis-archived stories on AshleyMadison.com between September 5, 2008, and March 5, 2009.
Clearly, straight-marriage fans fret about what two men wearing wedding bands might do to a man and woman with rings on their fingers. Whether this concern is scientific or superstitious, surely they must acknowledge that seeing Bob and Steve together in a porch swing is trivial compared to Adam philandering with his new AshleyMadison.com adulteress as Eve waits at home, watches dinner grow cold, and wonders why on Earth he’s so late.
Well said, sir.
Tom posted this at 6:53 PM HKT on Thursday, March 19th, 2009 as Kulturkampf
I love watching the Democrats destroying themselves. They face the most ineffective opposition party in the history of modern politics and all they can do is attack each other.
Good job, America, you elected a bunch of middle school wankers to lead us.
Back in the old campaign days, the Obama campaign sent out mixed messages on trade. Obama sounded protectionist notes, but Austan Goolsbee reassured Canada that it was mere rhetoric. Like former Attorney General John Mitchell (of Watergate fame), Goolsbee essentially told Canada, “Watch what we do, not what we say.”
The Obama administration has probably violated NAFTA by blocking Mexican trucks, which the Teamsters Union supports. So Mexico has, unsurprisingly, retaliated—but has done so shrewdly, in a way to punish the politicians who backed the Obama policy:
California, an important supplier of fresh fruits, dried fruits and nuts to Mexico, will be hit hard. Table grapes will face a 45% duty at the Mexican border; wine, almonds and juices among other agricultural products will pay 20%. Some 90% of Christmas-tree exports from California and 65% from Oregon go to Mexico. It’s doubtful volumes will hold up beneath a 20% tariff.
Alongside Oregon, Washington state will pay dearly to protect the Teamsters. Four out of 10 pears that the U.S. exports go to Mexico and half of those come from Washington. Under the new rules, American pears now face a 20% tariff, as do a host of paper products from the Pacific Northwest and Wisconsin.
Wisconsin’s scrap battery industry, which exports $128 million annually to Mexico, won’t be as competitive after it pays a 20% tariff. Nor will New York’s $24 million annual exports in personal hygiene products or its exports of $250 million in precious-metals jewelry. President Obama’s home state of Illinois can’t be happy to learn it will lose competitiveness under a 20% tariff on its plastic tableware and kitchenware exports to Mexico ($57 million annually) and on its printed leaflets and brochures ($68.7 million).
North Dakota Senator Byron Dorgan sponsored the amendment that closed the border and his constituents will pay. North Dakota only exports $1 million in oil seeds annually but 80% of that goes to Mexico. They now face a 15% tariff.
With the cost of imported U.S. products now higher, Mexicans will substitute these U.S. brands with products from Europe, Canada and Latin America. The retaliation appears to take care not to punish Mexican consumers or producers nor give new protection to any special interest in the domestic market. Its purpose is to focus Washington on its Nafta commitments.
Our third Irish president, Barry O’Bama, I guess, has some humorous run-ins with the teleprompter. Had George Bush thanked himself , it would have been incontrovertible proof of his stupidity. Such comments about President O’Bama would probably result in me being accused of anti-Irish prejudice or something.
Apollo posted this at 8:58 AM HKT on Wednesday, March 18th, 2009 as CHANGE!
Are the Republican Party and Movement Conservatives so bereft of actual ideas that they have to result to namecalling? I thought this was the exclusive domain of idiotic left wing talk-show hosts Senators like Al Franken. Perhaps I’m behing too hard on Ingraham. Maybe I misunderstood the nuances of her arguments and positions…
I haven’t had a very high opinion of Ingraham since the time I called into her show after she made the absurd claim that all morality stems from Judeo-Christian Philosophy. Still, I never thought she would become so moronic that her only argument against a blogger would be to call her fat.
Oh who am I kidding, given the state of talk radio and the fact that they are now the apparent arbitors of Conservatism, I expected nothing less.
All of you from the shrill Coulter’s and Ingraham’s to the pompous Hannity’s to the mean spirited, raving Levine’s can go suck a…lemon.
The notion that Porkulus violates the Constitution (also here) makes me giddy. That this has been brought to light only by the obtuseness of South Carolina makes me feel strange. However, I soon return to giddiness when I realize that the signature issue of our first constitutional law professor president violates such a basic tenant tenet of federalism. What an amateur.