The right green alternative to "the stimulus"

What’s wrong with the stimulus?

There are three big problems with the Pelosi/Reid stimulus plan Mr. Obama has now signed into law:

  1. the Keynesian macro economic ideas underlying the stimulus part of the bill do not fit the problem and will not work;
  2. the bill is heavily loaded with unreviewed and undiscussed agenda spending; and,
  3. there has been no significant discussion of alternatives on either the agenda or the economic policy issues.

At this point, of course, it would take a miracle to stop implementation of the bill – so that’s what this article is about: proposing an alternative and then discussing two ways of getting it accepted in place of this bill.
The Keynesian macro-economic idea: that an economy in trouble can borrow to spend its way out of recession, has a 100% record of failure. From American experience in the 1930s to Japan’s enormous public works programs in the 1990s, the application of Keynesian “levers of power” in national policy has consistently resulted in reduced employment, greater national debt, and longer term currency devaluation (expressed internally to the economy as inflation).
The reason for that becomes immediately obvious if you think about the stimulus strategy in the context of a large family in which one or two members lose their sources of outside income. In that situation the Keynesian recommendation is that other family members loan these people money in the expectation that they will use it to buy food, lodging, and other services from family members.
In the very short term this can help those who’ve lost their income, it can make the family feel good about taking care of their own, and it can transfer some of the family’s wealth to those providing the food and other support. Unfortunately, however, the longer term effect is to cause the family as a whole to lose wealth because the people providing that food and lodging have to get it by spending some of their money with strangers.
What’s wrong with the application of Keynesian economic theory, in other words, is that the theory assumes something that doesn’t exist in reality: an economy closed off from others by high tariff barriers – and what the dismal failure of every attempt to implement his ideas demonstrates is that even Japan’s barriers aren’t high enough. Some leakage always occurs, and making up for this by simply printing more money just devalues the currency as more and more of it is backed by less and less real wealth.
To really respond to the problem what the family has to do, and what the United States has to do, is to decrease short term spending while increasing earnings -at least until the lost income has been replaced and normal spending can be resumed.
The stimulus part of the Obama package does the opposite, and it can take a very long time for an economy damaged by this kind of thing to recover: eighteen years after Prime Minister Kaifu and his liberal democrats tried the stimulus idea Japan still hasn’t fully recovered; the damage inflicted by the Trudeau liberals in Canada during the Carter years didn’t get worked out until price change drove resource export revenues up over the last few years – and it took roughly seventeen years before the productive capacity built to fight World War II bought the United States out of FDR’s New Deal.

The economic plan

For a public policy response to a recession in an open economy to work, it has to create wealth rather than borrow it – and the recipe for doing that is well known: tax cuts lead to investment, investment creates jobs, the work done in those jobs creates wealth.
From the public’s perspective the cheapest and most effective tax cuts come as regulatory relief because these marginally reduce government spending, cost government nothing in lost taxes, and tend to produce new direct jobs with very high economic multipliers.
Canceling CAFE – the fleet fuel economy standards imposed on Detroit – would, for example, cost the taxpayer nothing while lifting the death sentence handed Detroit by congressional democrats: quickly putting tens of thousands back to work, protecting hundreds of thousands of jobs and pensions, and giving the American consumer back the right to choose which vehicle to buy.

But, doesn’t that endanger the earth?

There’s no doubt that repealing the CAFE rules would free Detroit to act rationally: making the big vehicles Americans want and the left professes to hate for environmental reasons, and any move to stand down the CAFE rules would therefore collide head on with three beliefs so deeply entrenched in the media psyche that questioning them looks politically impossible:

  1. that CAFE responds to the economic cost and national security consequences of a reliance on imported oil;
  2. that CAFE responds to the threat posed by global warming; and,
  3. that CAFE is a forward looking response to the peak oil hypothesis – the idea that the world will run out of oil.

Fortunately, however, all three beliefs are unfounded:

  1. America’s need to import energy is the direct result of regulation. Remove the regulatory barriers to American energy production and that production will happen.Implementing Newt Gingrich’s “Drill Here, Drill now” for everything from oil and gas to nuclear will make Americans more secure while redirecting the flow of consumer cash now going to foreign despots to American workers and investors – and in that process generate hundreds of thousands of American jobs, tens of billions in new American wealth, and enough new energy to shift the balance of world financial and manufacturing power back to the United States.
    The rationale for most of the regulations that would have to be weakened to let this happen is environmental – but:
    1. the alternative to American energy production is foreign energy production – without any of the environmental controls and expectations Americans take for granted. Pollution is a world problem: producing energy in a cash hungry dictatorship like Venezuela is a lot dirtier than producing it in the United States – meaning that the “pro-environment” regulations forcing Americans to import energy have the opposite effect: that of increasing pollution.
    2. the bad press Nuclear power always gets is ultimately traceable to a Soviet disinformation program intended to slow American progress to the hydrogen economy widely predicted in the 1950s – a program instituted after Kennedy’s election and subsequent collapse allowed Stalinist hardliners within the Soviet politburo to re-assert control.The China Syndrome, for example, was a hugely influential propaganda movie staring “Hanoi Jane” -an American who publically praised the Viet Cong for killing Americans and has since exerted considerable influence over CNN editorial direction- but has no basis in fact.
      In reality the safety and environmental record of the American nuclear program has been astonishingly good with no significant accidents in more than fifty years – even the Three Mile Island incident in 1979, although frequently cited by anti-nuclear activists as a community horror story, in itself produced no objectively verifiable harm to anyone.
      The Chernobyl hydrogen explosion did, of course, cause significant harm to tens of thousands of people but isn’t generally cited by environmentalists – presumably because everything about it, from substandard construction based on overscaling a 1943 American research reactor, to the inevitable response failure, illustrates both what’s wrong with the system of government they espouse and what’s right about the American approach to industrial safety.
    3. Al Gore to the contrary, using American hydrocarbon resources will not trigger a climate Armageddon.The fundamental claim: that changes in atmospheric CO2 levels cause superlinear change in atmospheric heat retention, has no scientific foundation.
      Adding CO2 to a flask of air does increase both the heat carrying capacity of the gas in the flask and its thermal opacity, but both effects happen because CO2 is denser than air, not because of any magical greenhouse properties – the phrase itself, by the way, comes from a 1969 technical publication by Dr. A.P. Ingersoll whose full title is: The Runaway Greenhouse: A History of Water on Venus, and refers to water vapor, not CO2 – and the popular misunderstanding that atmospheric CO2 traps thermal radiation was actually disproven by physicist R.W. Wood in 1909.
      Thus it’s not surprising that what is known of the historical record suggests that atmospheric CO2 increases follow, and do not lead periods in which global average temperatures have risen – and, of course, the average temperatures thought to have occurred in Europe and Asia during the medieval warming period not only preceded any significant human CO2 emissions, but completely failed to wipe out the polar bear or otherwise permanently affect the arctic ecology despite exceeding, over a continuous two hundred year period and by significant margins, average temperatures recorded in 1998 – the hottest year since the 1930s.
      Basically the entire gambit of selling human produced CO2 as a significant cause of negative climate change is scientific nonsense – something underlined by the tendency of climates on planets, including Mars and Venus, where there are no American SUVs, to move in near lock step with change on earth.
    4. On its surface the peak oil hypothesis looks reasonable: keep using oil and at some point we’ll run out of it – but this is a bit simple minded. In reality, the oil based infrastructure we have, with refined products like gasoline, diesel, and jet fuel powering most of our transportation system, is indefinitely sustainable.This seems absurd, but it’s high school chemistry: burning oil does not destroy any of its constituents, it just liberates some of the chemical energy stored in its molecular bonds – and because the earth is very nearly a closed system with respect to hydrocarbons, this means that any adequate energy source can be used to recombine those constituents to make as much fuel as we need from nothing more than seawater and atmospheric gases (particularly C02).
      Of course these plants will take years to design, prove, and build – so peak oil believers will tell you that the world doesn’t have time to get them in place – but in reality there’s no terrible urgency to this. In reality, free flowing oil and gas typically represent a few percent of the real reserve in each known field – and as scarcities produce price increases, tapping more of the rest becomes economically viable. Thus a field that’s 90% depleted at $30 oil, is usually less than 10% depleted at $90 oil – meaning that present levels of consumption can easily be sustained for perhaps hundreds of years – and certainly for however long it takes to get recombination technology into production.

    Thus the bottom line on this is simple: we have two groups of interacting regulations: those which, like CAFE, seek to ration energy use; and those which, like the tangle constraining drilling and nuclear, seek to limit energy production – but neither one has any basis in reality and both can therefore be rolled back without threatening the environment.

    But it’s too late – the bill is law

    Democrats would have you believe that the bill is law, a done deal – and there’s nothing you can do about it.
    That’s a lie: there are at least two, complementary, attack strategies:

    1. the first strategy is to fight each agenda item – like the attacks on states rights or the commitment to state controlled medical services rationing – in the traditional ways: using politics, the courts, and the press to slow spending and the imposition of change.This approach will mitigate the damage: slowing adoption of the worst excesses and eventually leading to some new and stable compromise – and of course we can all dream of full repeal after the election of a sensible Congress in 2010.
    2. the second strategy amounts to a Hail Mary pass – now that Obama has signed the bill into law, action on proof of his ineligibility for the office of the Presidency will both void the bill and create an enormous opportunity for reasonable people in Congress to put together a deregulatory alternative.

    Pursuing the first strategy is natural – difficult, but natural: and some people, particularly partisan Republicans and states rights advocates, will undoubtedly be doing this. However, theirs will be an uphill battle against a committed national media, a liberal judiciary, and significant democrat majorities in both houses of Congress.
    The Hail Mary pass should be absurd – but isn’t. There’s little doubt that the Obama campaign committed various financial frauds on its way to victory – the only real issues there are that the review and prosecution processes take a very long time and are likely, because Obama won, to focus almost exclusively on the junior players involved.
    The personal eligibility issue is more interesting; because you’d think this should be tin foil hat stuff – but then you find that there isn’t any actual doubt about his technical ineligibility.
    The constitution requires that the president be a “natural born citizen” – and while democrats would have you believe there’s some ambiguity about this, there isn’t. Think about the term “natural justice” – the idea that some concepts of right and wrong supersede the law – and you’ll understand the general usage of “natural” in this context to indicate the precedence of God’s law over Man’s.
    Thus what the term “natural born citizen” means today, and has meant for three centuries, is someone whose citizenship is established by right of birth, not right of law – and Article II, Section 1, Clause 5 of the Constitution therefore specifically bars anyone whose citizenship is established only by law, and thus not by nature, from the Office of the Presidency.

    There’s no issue here: you cannot have both a British citizen as your father and natural born status in the United States.  Obama, by his own testimony, indisputably holds his American citizenship by right of law, not right of birth; and is therefore specifically excluded by both wording and intent from the Office of the Presidency.
    Given the fact that the senate choose to investigate John McCain’s citizenship status on far flimsier grounds, this means that the English citizenship Obama inherited at birth would surely have disqualified him from the beginning had he run as a Republican – but media inequities are what they are, and Obama’s obvious ineligibility for the office is being treated exactly like Mrs Clinton’s ineligibility to serve as Secretary of State: perfectly clear in law, but widely ignored because it’s seen as a unfair to a leading democrat in its application.
    Most of the challenges, however, don’t take this as their primary basis. Most of the challenges invoke, instead, one of three alternate theories to declare him ineligible:

    1. that he was born in Kenya, then returned to Hawaii by his mother and is ineligible by both birth and citizenship;This claim has no obvious factual support – other than eyewitness claims by interested parties including his Kenyan grandmother and the absence of birth documentation in Hawaiian hospital records – but cannot be disproven by the evidence at hand either:
      1. No one in the Hawaii government has said he was born there: what they’ve said is that they have the records.
      2. The certificate of live birth provided by the Obama campaign appears to be a crude forgery. Comparable certificates for other mixed race children born in Hawaii during that period have the words “Negro” or “Negroid” for the father’s race – not the apologetic modern “African” shown on Obama’s.
      3. The source for the newspaper announcements pointed to by those arguing for Obama’s Hawaiian birth is not known. If his grandmother placed them, she could have done so whether he was born in in her front parlor or in Kenya and on his way to her.
    2. that he knows his real father was a far left activist named Davis and is ineligible because he’s running under an alias;The “Davis” hypothesis raises some interesting issues, but on net would actually strengthen his claim to eligibility since Davis was an American – and would also provide cover for his refusal to provide documentation.
      What’s most intriguing about it, however, is that it’s also the only explanation anyone has offered for the extraordinary support that got him into, and kept him in, very expensive (and very left wing) private schools in Hawaii, Los Angeles, and Chicago.
    3. or, that his adoption in Indonesia and subsequent travel in Pakistan demonstrate that he was not, and did not consider himself to be, an American citizen at the time and is ineligible because he gave up, or his mother gave up on his behalf, his American citizenship.
      1. The Pakistan travel argument is simple: He claims to have traveled in Pakistan when it was illegal for Americans to do so. Therefore he didn’t travel on an American passport -and if he traveled in Pakistan as a foreign national then he’s ineligible either because he’s not American or because he traveled under a false passport without appropriate official sanction.Unfortunately, we only have his word for the travel: this was something he cited to give himself foreign experience during the campaign – something that can be easily dismissed as just one more lie on the trail to electoral success.
      2. His defenders claim that the Indonesian citizenship issue is obfuscated by a tangle of applicable law in both countries – basically, mid sixties Indonesian law on citizenship was in a state of flux (leading to serious bloodshed a few years later) – and American law has changed a few times too. This is true, but not relevant – what is relevant is that under Indonesian law, then and now, his mother could not have married into an Indonesian Muslim family without formally renouncing both her own American citizenship and that of any dependent children – including Obama.Since she did marry, did accept Islam, and did send Obama to a Muslim school, she had to have signed the renunciations – making Obama either British (Indonesian law at the time passed citizenship through the father) or Indonesian (Indonesian law after the citizenship reforms of the late sixties).
        Under American law, which allows dependent children whose parents renounce their citizenship to formally reclaim their American birthright on or after their return to America, Obama could have reversed this on or after his return to Hawaii – but no one has produced any evidence that he did.
        As a result his legal citizenship today is either Indonesian or British – and on this it doesn’t matter whether he born in Hawaii or Kenya, or whether his father was Obama or Davis – his failure to reclaim his citizenship on his return to the United States makes him ineligible for the Office he holds.

    The bottom line on these allegations is that the British citizenship inherited from his claimed father is certainly correct but a technicality which many feel would be unfair to hold against the son. The Davis as father hypothesis is interesting but embarrassing rather than determinative, and the travel in Pakistan business easily side-stepped by claiming the lesser lie.
    The failure to reclaim American citizenship is, in contrast, both indisputable on the record as we have it and easily seen as a continuation of his mother’s deep contempt for, and rejection of, American values -and not by a dependent child: by the young man who has since “brought a good speech” to his current role as President of the United States.
    It’s this continuation of his mother’s contempt for American values that makes the citizenship issue easily exploitable politically – and the vulnerability this creates probably explains his willingness to spend millions of other people’s dollars to prevent public release of the applicable records: most recently hiring the high profile law firm of Strumwasser & Woocher to intervene against a subpoena directing California’s Occidental College to produce his enrollment records by threatening those questioning his status with personal financial ruin.
    There are two important and disturbing notes to this:

    1. first, the whole birth certificate issue appears to be a sacrificial red herring – possibly even designed and prompted by the Obama campaign itself to ensure that if public scrutiny of his actual immigration status ever develops real momentum, it can be permanently derailed by production of the real certificate – even though his place of birth has absolutely nothing to do with either his inability to meet the technical standard as natural born, or his failure to reclaim his American citizenship after his mother renounced it on his behalf.
    2. second, Obama’s continued success in surpressing discussion of the eligibility question by disparaging those who raise it as “truthers” undoubtedly resonates with those who still see the 2000 Bush V. Gore decision as wrong, but is ultimately leveraged on the threat of riot if he is removed on constitutional grounds.Accepting this is an act of cowardice: here, as elsewhere, silence is acquiescence and the mass media’s failure to raise the issue a dishonourable act of appeasement with nothing less at stake than the foundations of American freedoms in constitutional law.

    There is no doubt that Obama’s forcible removal from office is a distasteful prospect, but there is equally no reasonable basis for doubt about his ineligibility for that office – and therefore that all of the orders and bills he has signed, or will sign while in office – including his appointments, overtures to Iran, abandonment of Israel, and the stimulus bill – are null and void in law.
    Getting the job done will be hard – but it’s a job that has to be done: the stakes are simply too high not to fight. Obama and the democrats have just handed America a ten to fifteen year economic setback, a trillion dollars in new public debt, and a sweeping social agenda guaranteed to seriously weaken America in the face of the world’s problems – all of which will naturally get worse: from a nuclear Iran and the collapse of Pakistan to the Communist takeover of Taiwan, the price for America’s failure will be paid in American freedoms, world progress, and generations of blood.