Will Florida matter as much in 2016 as it did in 2000? We seem to be getting a preview in the bare-knuckles, too-close-to-call race for governor. Incumbent Rick Scott and Democratic challenger Charlie Crist are at it, and it will only get nastier between now and November. That won’t be such a bad thing in fact because one of the central focal points in the mud slinging is Obamacare. Rick Scott built one of the largest healthcare companies in the world, Columbia HCA, and was then forced to resign after a payments scandal with respect to medicare and medicaid that resulted in charges being laid and a $600 million fine being paid. This will be dragged across the stage by Crist’s campaign, but the fact remains that Scott was not personally implicated and no charges were laid against him.

Governor Scott, on the other side, is launching attacks on Obamacare and the flexible – from Republican to Independent to Democrat to staunch Obama ally – Crist’s support for the Affordable Care Act. His attack is based on the fact that Crist’s support for Obamacare is not about liberal principles on the part of the former governor, but rather convenience. He gets the full support of the White House in return for being an unqualified supporter of Obamacare. Whatever party, whatever policy it takes, Charlie Crist wants back in the governor’s office. And Crist seems to be aiming for South Florida’s undecided voters rather than just focus on Central Florida.

That means working on turnout among Democratic voters in South Florida. Does that sound familiar? The primaries that both contenders easily won indicate that voter turnout among Republicans was higher. Not a good sign for Crist’s campaign and hence his focus on South Florida. That means not only talking about Obamacare but also railing about immigration – Rick Scott’s stance on immigration that is. In fact, after winning four years ago with a hard-line stance, Scott has softened on the issue, supporting reduced college tuition for younger illegal immigrants, the so-called dreamers. Crist is also focusing on South Florida because Obama has managed to win there – barely, but win he did – for two consecutive elections, And those staffers that plotted those victories are now available for Crist’s campaign. Tampa, as always, is still key and if Crist can do well there then his chances against Scott improve. Scot will keep hammering with negative ads to ensure Democratic or Independents do not turnout in increased numbers. With Libertarian Adrian Wyllie as a wild card, the election for governor in the sunshine state will be very hard to call. If Crist wins, it will not be what he stands for, but because Democrats are scared that Florida will go the other way in 2016. So they are willing to suspend judgement on who Charlie Crist really is, and vote for the former Republican.

Jeff Bell is a veteran of politics and the think-tank circuit. And it just might be that this fall, people will actually know who Jeff Bell is. Last June, he won a four-way primary for the GOP in New Jersey and just lately, the National Republican Senatorial Committee, the GOP’s all-things-elections organization in the senate, has begun running attack ads against New Jersey Democratic Senator Corey Booker, Bell’s formidable opponent who holds the New Jersey Senate seat. Have they rolled out the red carpet for Jeff Bell? Hardly, but it is worth remembering who he is and what he has done.

After working on Reagan’s national campaign staff in 1976, he was a Reagan delegate for New Jersey in 1980. But in between, in 1978 he won an upset in the primary for the GOP Senate seat in New Jersey. He did it by anticipating the Reagan tax cuts of 1981 on the same day in June of 1978 that Proposition 13 passed in California. He lost the election back then, but 36 years later is surely hoping that his luck will change. What is he running on? He criticizes quantitative easing as a Wall Street bailout that has left middle class America in decline. It’s a bold strategy that he’s outlined in pieces for the Weekly Standard, and it puts him at odds with some in his own party. But he earned his place in the GOP a long time ago, and now he might have an outside chance to collect some dividends on all the years he’s put in as an advocate for monetary discipline, even a return to the gold standard.

To even mention the gold standard today is to put yourself at odds with the overwhelming consensus on monetary policy within the halls of the Fed, or other major central banks around the world. Quantitative easing is seen as a successful strategy that saved America, and the world, from depression. Perhaps it did save the financial system from a freeze-up that would have turned the crisis into something much worse; but the question remains as to whether it went on too long and whether central banks around the world are now addicted to easy money. At some point there will be inflation – how much is hard to say as the competitive pressures of global marketplaces help contain price pressures. According to some measures, inflation is already here. And it may be that Jeff Bell is at least partially right and his stance on Wall Street will not hurt him with average voters. It may be that the media is swooning over Booker, but Jeff Bell may be able to mount a better campaign than most expect. And even if he doesn’t win this election, he might turn out to be right in the longer run.

One of the reforms to the tax code proposed by Paul Ryan involves the deductibility of state income taxes against federal income taxes. He’d like to eliminate that provision, stating it’s basically a subsidy for high-income tax states like California and New York, who can spread the burden of their state deficits across tax payers throughout the country. The state of California’s finances are abysmal and why should voters in Wisconsin help pick up the tab? While subsidies to energy and agriculture have been in place for a long time – and one can argue for them in terms of national interest although that might not convince some people – the only justification for this particular subsidy is to gain votes on both coasts.

Subsidies in America have been around a long time; tariffs were slapped on British coal in 1789 by the newly minted government. Given they had just fought a war to liberate themselves from perfidious albion, it made both military and mercantile sense that such a subsidy was enacted to protect and encourage local industry and gain energy independence. In terms of agriculture, the USDA really expanded it’s functions under Roosevelt in the 30′s and no one has been able to roll back agricultural subsidies since that time. Agricultural lobby groups have co-opted the support of those who favor food stamp programs in urban centers as well as those who support environmental subsidies, linking them back to agricultural subsidies. So good luck on trying to cut back on agricultural subsidies.

Ryan might have a little more luck with state income tax deductions. If he does indeed end up heading Ways and Means, then he will have the position, and perhaps the clout although that is less certain, to push for eliminating the deductibility. The only thing the state income tax deductibility subsidizes is deficit spending in California. If Ryan deems that compromise with California and New York on this issue is not vital, then he may succeed. Voters in Wisconsin, and quite a few other states, undoubtedly hope he does.

There’s a storm raging in the halls of Congress among Democrats. It will soon shake your windows and rattle your walls. Well, not really. Burger King is moving it’s Headquarters to take advantage of lower taxes … in Canada. Well, not really. But yes, the corporate tax rate under the Conservative Government of Prime Minister Harper has come way down in the last few years compared to Canada’s Liberal Party days. According to the OECD, the combined federal, provincial, and local corporate tax rate is 26.3% compared to 39.1% in the US. But Burger King’s effective tax rate, according to its own annual report was 27.5% last year. And the company that Burger King will be swallowing up to the tune of 11 billion dollars, Tim Horton’s, had an effective tax rate last year of 26.8%. So, this isn’t really about taxes, it’s about breakfast.

Burger King wants to break in to the morning coffee and McMuffin market and sees Tim Horton’s – a doughnut, coffee and sandwich franchise that spreads right across Canada – as the perfect product to bring to the US market. Not that Tim Horton’s hasn’t tried to break into America. Their $600 million plus expansion into the US market has failed to impress consumers and now they seem to have found a willing buyer. Part of the deal is that the combined companies, (each of which will keep its current head office in place in Miami and Oakville Ontario), will have their headquarters in Canada. This is the part that has Democrats threatening punitive legislation. How many lawyers and accountants will actually troop north of the border from sunny Miami, remains to be seen. The combined HQ seems more of a pat on the head to Canadians who will lose one of their favorite franchises to the clutches of the Florida colossus. In fact, however, Burger King is owned by 3G Capital, a Brazilian investment firm which will own 51% of the combined companies. Yes, it may garnish a few tax savings by moving north but this seems more of a strategic alliance to try and wiin the fast-food war against MacDonald’s. Of course, should the corporate climate turn colder in Canada, the newly formed fast-food colossus can always think about moving the combined head office back south. Way south, to somewhere like Sao Paolo. Given Brazil’s left wing politics and rising inflation, that may be some time away.

Rates are going up for Obamacare. What a surprise. The Affordable Care Act has as its goals, increasing coverage, reducing costs, improving affordability, and increasing the quality of healthcare. This is an absurd mixture of conflicting goals; but you can’t say that because it’s health care. Even under the – somewhat – more efficient system of private insurance, these goals imply trade-offs. There is no way around this fact in the real world. No amount of intelligent organization – leaving aside the fact that the ACA is less of an improvement and more of an added layer of bureaucratic complexity – can erase this trade-off. How can you possibly increase the quality of healthcare for millions of Americans and not pay for it? How can you increase coverage for patients who either couldn’t afford or were seen as high risk by insurers and not have rate increases to cover at least some of the added cost?

Well you do it by a delicate balancing act that inevitably ends up landing on its backside. The two forces at work here, in economic terms, are pooling and moral hazard. At one end of the spectrum, with a free market solution, insurers are drawn to pooling as the more profitable strategy: lower-risk, healthier patients are accepted while higher risk patients are either not accepted or must pay much higher rates. Moral hazard in this case is very low; patients will not over consume health care services and clog the system. At the other end you have a single payer system that funtions with rationing; you need a hip replacement? We´ll wait a few years and see if you die first to save on costs. There is little pooling, everyone is in the same state-run boat and have to wait their turn to one day hopefully get the treatment they need. Except government officials of course, who seem to get prompt attention under any system. Moral hazard, the wasteful use of resources because there are no disincentives against wasteful or risky behavior, is very high in this case.

Most health care systems in the developed world are some mixture of these two. That means trade-offs, and managing those trade-offs to produce the result aimed for is no easy matter. In the case of Obamacare, patients are passive recipients. In free market solutions, like those proposed by Dr. Ben Carson, patients can take charge of their health the same way people have learned to do with their retirement savings. It still leaves the problem of catastrophe insurance – a bad accident, a fatal disease – and that is where state subsidies should really focus. But when you launch a boat as big as Obamacare, added decks inevitably get built. The result is titanic, but rather than an iceberg that will sink you in the blink of an eye, what you get is a slowly sinking ship that has to bailed out – both by taxpayers and Obamacare users themselves. Rates are going up? No kidding.

 

Of the latest participants, the ALS Ice Bucket Challenge has “broken the ice” into politics. Former President George W. Bush intended to “simply write a check,” but his wife Laura decided it were better for him to be doused in ice water.

In a statement on Facebook, Bush said, “Thanks to Jenna Bush Hager, Rory McIlroy, Woody Johnson, and Coach Jim Harbaugh for the#IceBucketChallenge – and to Laura W. Bush for the check. Next up: President Bill Clinton. Help#StrikeOutALS at www.alsa.org.

In a political atmosphere of perpetual finger pointing, it is refreshing to see some sort of bi-partisanship for such a deserving cause. President Bush concludes the video saying, “Now it’s my privilege to challenge my friend Bill Clinton.” Watch the video below.

 

Ferguson, Missouri has become a must-see destination for media and progressive activists, as well as criminal elements that have come from as far away as New York and Los Angeles according to local law authorities. Captain Ron Johnson of the Missouri Highway Patrol who had received and given hugs a few days ago is now furious. His officers received gunfire from protesters and a truckload of “activists/protesters” were detained with guns and a molotov cocktail. Amnesty USA’s director Steve Hawkins, a long-time advocate for prisoners, especially those on death row, stated he wasn’t sure if rocks were thrown by protesters, but did point out the obvious that police had used tear gas. He of course is now on the ground in Ferguson along with German media crews who can show violent images to a lustful European public who can cluck their tongues disapprovingly because police had to fire canisters at armed and violent protestors. Won’t you please come to Ferguson for a riot; and we don’t want to change the world as much as cause chaos and get a little looting in.

It is tempting to talk about the Weather Underground and their campaign of terror in the early 70′s as a protest against the Vietnam War. They were inspired by the rioting in Chicago in 1968 – they were an integral part of the rioters/protesters of course – and turned to out and out terror. Bill Ayers, the ex-leader of the group and a retired U of Illinois professor who has defined the Weather Underground’s bombing campaign as “extreme vandalism,” would surely approve of the molotov cocktails in Ferguson. He might even wax nostalgic about how he would have been on the front lines had he been a little younger. The left always justifies it’s violence through the prism of marxism and its class struggle. So it is clear that underneath the breathless tones of some of the media, as well as people like Amnesty’s Hawkins, there flows the stale, polluted waters of dialectical marxism whether they admit it or not.

It is tempting to make these sorts of analogies, but it’s a mistake. It only encourages and justifies further confrontations that end up giving way to the most violent, rather than those protesting peacefully. And it paints a picture, a false, distorted picture of events in Ferguson. Violent criminals are taking advantage of the protests; both to profit and because, well, they’re violent criminals. Justice will be done in Missouri, whether Hawkins, Sharpton, or reporters for Die Welt are present or not. And it will be done because Captain Ron Johnson and his men, along with the National Guard, restore order and because investigators do their job. Will criticism of militarized police tactics – now coming from some voices on the right as well as those on the left – be part of this rebuilding process? Undoubtedly, but at this point, disarming the rioters would seem to be the priority, not disarming the police.

The United States Department of Housing and Urban Development (HUD) was created in 1965 under LBJ’s Great Society entitlement scheme, just as Henry Cisneros was in his sophomore year at Texas A&M. It would be another 9 years before Julian Castro (and his twin Joaquin) would be born in Cisnero´s hometown of San Antonio. Both Cisneros and Julian Castro would hold the mayor’s office in San Antonio before moving up to Washington to take the job of Cabinet Secretary at HUD. Cisneros took a while to get there; he was well into his forties by the time he got the job. Julian Castro is still – barely – in his thirties, and by all accounts, HUD will not be his last stop in Washington, unlike Cisneros who after a scandal with a former mistress was forced to resign. We haven’t seen such excitement in a while from Democrats over someone who might be a VP candidate in 2016. Obama himself welcomed him to the job at HUD and now he’s had his swearing-in ceremony with Joe Biden whose job many Democrats are hoping he will take.

Why? A Hillary-Julian ticket is the perfect identity-politics pairing for many Dems. If the marriage seems a little May-September at first blush, it will be up to Julian to prove he belongs on the podium. So who is he? Or more to the point, what has he done for voters lately? San Antonio has a council-manager system of government where the mayor’s office is largely ceremonial. That means you have to look back at Castro’s record as a council member. That mostly means his being part of the council that lured Toyota and several parts suppliers to the San Antonio area. Of course, that would have had a lot to do with the State of Texas and the tax-friendly environment provided to corporations by state laws. They say the Riverwalk expansion is a very nice addition to the city but that mostly comes from Castro’s predecessor in the mayor’s job, Phil Hardberger who left office with an 86% approval rating.

In other words, the main thing about Julian Castro is that he’s … Julian Castro; a bright – he got into Stanford with a little help from affirmative action – young – he’s almost forty – hispanic american politician who believes in affirmative action and gay rights. He’s a Texas progressive with a very short list of tangible accomplishments. How will he do at HUD? He’s got a slow, make that really slow, housing recovery in his favor – for now at least. Will he handle beltway politics well? He already has had the principal and the vice principal give him pats on the head (and you can throw in a well publicized meeting with Harry Reid as well). Do any of his fellow Democrats want to take him out behind the swings and work him over? One suspects we’ll find out fairly quickly how adeptly Julian Castro manages to survive in Washington. 2016 is a long way away in the beltway calendar.

Ferguson was back in riot mode this weekend as Governor Nixon ordered the National Guard in to control looting and violence among protesters. Up until now, the police and the media have been the two main institutions present, with the courts yet to enter the fray, and politicians still trying to calm things down in order for investigations to proceed. So we have lots of footage of clouds of tear gas and angry mobs confronting heavily armed police – is there any other way to face molotov cocktails? – interspersed with Reverend Sharpton’s raging calls for justice. Does any of this this help calm things down? Dr. Ben Carson wondered out loud on television who exactly the looters were, or more precisely, whether they were from Ferguson or elsewhere. And he also asked what exactly do they want? Mob violence is a dangerous phenomena that takes a lot of energy and skill – and involves considerable risk – to bring to an end. Ben Carson’s call for dialogue is understandable, but the question is how do you get there? Any dialogue at this point will surely be nothing more than a shouting match – shouting is of course preferable to firebombs and looting.

So by all means, start the shouting, but stop the rioting as well please. There is evidence that is being released piecemeal and what is needed is an expedited investigation to clear up the facts. That does not mean a rush job. It just means avoiding any unnecessary delay. We will have had at least 3 autopsies by the time investigators truly get to work and some reports are suggesting that Michael Brown was charging the officer by the nature of the bullet wounds in his body. In Missouri’s long hot August, these investigations will have to be handled as cooly as possible. It is an impossibility that they will satisfy all of those concerned but the only other option is charging security forces with containing rioters night after night. Let’s remember how the Detroit riots left a scarred city that is still trying to recover its former glory. Ferguson is not Detroit nor will it become a little Detroit so to speak. But expediting the judicial process, as Dr. Ben Carson suggested, would clearly set things in the right direction.

In Texas, Umphrey Lee Elementary School has fallen from grace. The Dallas Independent School District (DISD) has uncovered cheating – teachers coaching and preparing students with near exact versions of the exam questions – on the STAAR tests taken by students. After 5 teachers were transferred out of Umphrey Lee, the scores dropped dramatically as the school fell from the top of the rankings right to the bottom. The DISD unfortunately failed to let parents know of the scandal until very recently. What is STAAR? Why that would be State of Texas Assessments of Academic Readiness, a state-mandated standardized test born on the grave of TAKS – Texas Assessment of Knowledge and Skills which was killed by the state senate in 2007 in a bill demanding a return to end-of-course assessments instead of TAKS approach of testing general core subjects. TAKS in turn was begat by TAAS – Texas Assessment of Academic Skills – which saw light in 1991 after being begat by TEAMS – Texas Assessment of Minimum Skills which was laid to rest in 1990.

It is not at all cute to say that these twisted tangles of acronyms are in fact the Genesis of state mandated testing. It started in Texas, and it seems Texas is still trying to get it right. Who needs Common Core when you can have all kinds of fun with battling versions of what an appropriate standardized test should look like? Or perhaps one should ask, should it be easy to come up with a schools standardized test? And what are they intended to be used for, compared to what they are actually used for?

In a piece published on ASCD’s site – formerly the Association for Supervision and Curriculum Development which saw light in 1943 – James Popham criticized the use of standardized tests for evaluating the quality of education. He stated that: Standardized tests are a one-size-fits-all and do not measure “curricular diversity.” What is taught in a particular classroom anywhere around the country might not match the focus on a standardized test. Secondly, in order to differentiate between students, tests are constructed in such a way that questions that a large majority of students tend to answer correctly are eliminated from the test. Questions that most students fail to answer correctly are also eliminated. That means items that students understand well are often not on the standardized tests. As well, questions that measure student’s “in-born intellectual abilities” are not a measure of how well they have been taught, according to Popham. Finally, he takes a shot at out-of-school learning which is often reflected in these tests, placing lower-income students at a disadvantage, although he is careful not to use the term. Throw in the conflict over intelligent design’s place in any curriculum, especially as regards the Texas Education Agency, TEA, and it seems that constructing a standardized test that will please all so-called stakeholders is an impossible task.

Unfortunately, some sort of standardized tests are necessary if students abilities to do math and science and read and write are to be assessed. How much weight should be given to any of the test results is a matter that each state will be grappling with for some time.

In Ferguson, Missouri, businesses are cleaning up after a little rioting. A candlelight vigil for Michael Brown, who was shot during a scuffle with a policeman, turned ugly. Stores were looted, cars vandalized and over 30 people were arrested but the looting was widespread, literally, and it was hard for the police to track down all those involved. Ferguson mayor James Knowles was concerned over the violence and what it would do to Ferguson’s reputation. St. Louis County Executive Charlie Dooley had a different view. “Right now, I’m just worried about people, not property.” County Police Chief Jon Belmar had yet another perspective centered more on the incident itself. One of the two men (young men presumably) had pushed a police officer into his vehicle after the officer confronted or spoke to the man. Belmar is trying to clear up what happened inside the vehicle, where a shot was fired. The “scuffle” – which seems to have been a police officer fighting off an attacker inside his own squad car – then spilled out onto the sidewalk and more shots were fired. Brown was fatally shot.

One hopes that whatever investigation is carried out, some sort of clarity can be achieved on what exactly happened in Ferguson. Whether that will be enough – assuming the investigation is prompt and thorough – to ease tensions remains to be seen. The confrontation occurred outside an “apartment complex” and one can imagine that the suspicion of drugs may have played a role, but that as well remains to be seen. If the officer was indeed pushed backwards into his vehicle, what right does that officer of the law have to defend himself? The question might seem tautological – self-defense is part of the job description – but the question will be whether the self-defense was justified. Race will be cited as factor between Ferguson’s majority African-American residents and the Police Department but the right to self-defense hangs heavily over the incident.

The Florida stand your ground law and the Indiana self-defense statute, for example, share the view that you are not required to flee or retreat when you have the right to defend yourself, especially in your home or vehicle – whether before another individual or even before a public servant in Indiana’s case. When exactly you do have the right to defend yourself is a matter of law, whether in Florida, Indiana, or elsewhere. Laws,however, are not always clear until the courts clear them up and that takes years. A confrontation involves split-second decisions, especially if you’re a police officer struggling for control of your own weapon inside your own squad car. It is clear that arbitrary detention, along with taxation without representation, were the kindling for the revolt of the colonies, so the roots of these self-defense laws run deep. It would be a grave mistake, however, to shackle the police’s ability to enforce the law under the banner of self-defense. And it’s absurd to think that anyone will be safer in Ferguson because people rioted and looted.

Voting in Mississippi is again in the spotlight with Chris McDaniel likely to challenge the June 24 run-off vote for Senator in circuit court. McDaniel, who has Tea Party support, lost a close race to GOP incumbent Thad Cochran, and has leveled accusations that Democratic voters – prohibited from cross-voting in different primaries – were illegally recruited by Cochran’s campaign. The McDaniel campaign compiled a list of crossover votes, “irregular votes”, and “improperly cast” absentee ballots. The total comes to about 15,000 votes which is about double Senator Cochran’s margin of victory. Unfortunately for McDaniel, the Mississippi GOP will not be hearing his challenge, and the courts seem the next move on his part.

Thad Cochran had graduated from college, served 2 years in the navy, gone back for his law degree and successfully campaigned for and won a seat in the House before Chris McDaniel was born in 1972. He has been in the Senate since 78, and if re-elected will likely break even more length-of-tenure records. He has been popular for a long time, or was popular in the past and is less so now. Aside from the question of whether he broke state voting laws – violations are considered a misdemeanor – it seems clear change is coming, if not as fast as McDaniel would like. The run-off vote might not be a scandal, but it does raise the issue of voter laws at the state level. The initial vote in early June and the run-off were the first time Mississippi’s new voter ID laws were put into practice. In the days before the June 3 vote, scrutiny was being cast over the voting procedure to ensure that voters were not denied their rights, and the state seemed to bend over backwards to make sure no one was denied a chance to have their say at the ballot box: 1000 government ID’s were handed out free to those who apparently lacked an acceptable photo-ID card. You had a choice of 10 types of ID cards you could present when voting as well. When the courts take up Chris McDaniel’s likely challenge, they will have to decide if, rather than being denied rights, voters in the primary run-off took advantage of their rights, or let someone else take advantage of their rights in order to win a close race.

While Joseph Lawler’s piece in the Washington Examiner on why Americans keep getting inflation “wrong” might not have been front-page, headline-making news, it certainly did evoke a cluster of consistently angry responses from readers. As the readers quite bluntly suggested, the CPI is not an accurate reflection of the cost of living they face. Are the readers right, and the sources quoted by Lawler – the unforgettably named Wandi Bruine de Bruin, a psychologist hired by the New York Fed, and Mary Burke, a Boston Fed researcher – wrong? There is a growing viewpoint that suggests that that is indeed the case. In the first case, the CPI is used to index wages of government workers, including the Bureau of Labor statisticians who cobble together the omnipresent index. This is a clear conflict of interest as it obviously is in the interest of government to present a low – but not negative – CPI in order to keep the cost of government wages down. The second point is that the CPI is an artificially assembled basket of prices of goods and services that an “average” household supposedly consumes. By definition, it is not representative of any household or individual whose actual expenditures deviate from this mean. Do you spend a higher percentage of your budget on food and gas compared to the CPI mean? Then you have a higher cost of living than that measured by the index.

Thirdly, and most controversially, the methodology used to put together the CPI has changed over the years, as Congress has put its very visible hands on the process to ensure that inflation is not “overstated.” In its original form, the CPI was calculated as a Cost of Goods Index (COGI); the change in the price of a fixed basket of goods and services over two time periods. It is now a Cost of Living Index (COLI). This is a far different beast; it involves making value judgments about what goods and services must be consumed to maintain a certain quality of life. The quality of the good or service consumed (mostly processing power in your CPU and bells and whistles in your vehicle) is taken into account and weightings are changed continually. That usually means less weightings over time for the stuff that costs more like food and gas, and higher weightings for the stuff that costs less or that costs more but gives you more, according to the Bureau of Labor statisticians.

Some economists call for a return to COGI which would mean current CPI is running over 5% annually according to some estimates. Others call for commoditiy price indexes which are the leading indicators of inflation in their view with CPI as a lagging indicator. This methodology gives you an inflation rate of around 8% annually. Then there is the Austrian school of economics – and others – who view inflation as an increase in the money supply which devalues any currency by the rate of the increase. M2 (cash, checking and savings deposits and money market funds) increased almost 5% last year. Clearly, there is a huge disconnect between these indicators and the offical CPI that is running at less than 2%. Who do you believe?

Philadelphia schools are back in the spotlight with the Pennsylvania Legislature apparently unable to agree on a tax bill to fund a shortfall in the city schools budget. A $2-a-pack cigarette tax is the magic formula being pleaded by Philadelphia mayor Michael Nutter and Schools Superintendent William Hite, but it has not been enough to convince the State legislature to vote the measure into law. Philadelphia City Council and Mayor Nutter are Democrats while the State Legislature’s Republican majority apparently is divided over tacked-on amendments to the bill. The mood among some House members does not seem to be one of overwhelming urgency. House Appropriations Chairman Bill Adolph said a compromise could be reached “once we’re back in session.” That would be September 15, a week after the official start to the school year.

Would it be a tragedy if schools were delayed a week? Perhaps not, but this seems to be another skirmish on a ship that is not sinking but definitely needs to change course. The city’s schools have been rising and Governor Tom Corbett (R) on Wednesday criticized the city teachers union for not making enough concessions. Schools are being closed but costs continue to escalate. But it goes deeper than just what share of the pie should go to the school system. Philadelphia seems to have become the battleground in the debate over education reform.

One can begin with the fact that Philadelphia city school kids, on average, are performing below national levels. After this point, there is very little agreement between opposing groups on how to achieve a solution. In one corner sits – or stands shouting is more like it – is Diane Ravitch, former Assistant Secretary of Education under Bush padre and Clinton. After being part of the education reform movement, she made an about face four years ago and is now vehemently against voucher systems and teacher merit pay and insists the public school system does well by international standards and when it doesn’t, those standards don’t matter anyway. As you can expect she states “the best predictor of low academic performance is poverty – not bad teachers.” Her opponent is former DC schools chancellor Michelle Rhee. If Ravitch is about collaboration, increasing taxes and hard-nosed teachers unions; then Rhee is about competition and merit, and performance. Both have spoken in Philadelphia in the last year or so, both recognize the city’s schools as a battleground in the debate on how to improve public education. So if the State Legislature takes a few weeks to decide how to fund a school system that seems to be failing, maybe it’s not such a great tragedy if Philadelphia schools open a week late.

What does it take to ensure a secure border? More than the resources – billions of dollars worth of materials and manpower – it is the clarity and fortitude to defend the border from within the sovereign state that is itself defined by that very border. Defined, that is, in more than just geographical terms. And to defend that border the state has to define – again, with clarity and strength – who can cross and who cannot cross that border. The nation’s laws begin precisely, in every sense of the word, at the border. After decades of increasing assaults on America’s sovereignty we now have another fatality. A US Border Patrol Agent shot to death by two illegals who had been deported multiple times and at least one of whom possesses a lengthy rap sheet. Shot to death wihile off duty fishing with his family, including a young child. Shot to death because the agent tried to defend himself from a robbery.

The robbery occurred near the border in Texas. In other words, it could have been anyone that day who might have been fishing with their family. It might have been a car salesman, a store clerk, a nurse with her husband. Anyone might have been exposed to the deadly assault that took away the agent’s life. The border area seems to becoming a no man’s land – it is worth remembering the term arose from the trenches of WW I – where those who are willing to break the law to enter the country mingle with those who break the law because they are hardened criminals looking for victims. How do you impose the law when people like Gustavo Tijerina and Isamael Vallejo, the two suspects, can enter and re-enter seemingly at will? You can’t say we’ll stop the bad guys but we’ll let the kids in. You either defend the border or you end up with the bad and the ugly coming in, and the good dying trying to defend themselves and uphold the law. The United States of America begins on that first square inch of territory that people like Tijerina and Vallejos step foot on. In the name of all those who defend the nation – on the border and overseas and within the borders – let us hope and pray that the Administration somehow, someday understands that the border is a matter of law, the first matter of law for anyone seeking to cross it.

The Consumer Financial Protection Bureau (CFPB) – mandated in 2010 to protect consumers in the financial sector and set up in 2011 – is hard at work as the investigations start piling up. Problem is, they’re investigating themselves and not financial institutions. An employment report released last spring that was critical of the workplace environment, especially from the perspective of African-American employees, is now going to be reassessed by means of another investigation; this time by an Atlanta law firm with long-standing ties to the Democratic party and whose founding partner was the late civil rights lawyer, Donald Lee Hollowell, who represented Martin Luther King and secured his release from prison in 1960. The problems center around the CFPB’s Consumer Response Unit, nicknamed “The Plantation” by African-American employees.

This is clearly a two-pronged effort to: 1) Clean up the reputation of CPBR managers accused of discrimination and, 2) intimidate employees into cooperating and prevent further whistleblowing. Washington employment attorneys are in a fuss over the case and Rep. Patrick McHenry R – N.C. was disturbed by Margaret Plank, senior CFPB lead counsel who is leading the new investigation, having been the opposing counsel in the previous investigation. An agency that did not exist a few years ago is already embroiled in the minutiae of bureaucratic process as investigations and counter-investigations are rolled out. Do we really need all this?

In his book What Government Agencies Do and Why They Do It, James Q. Wilson states, “…in government (where) the need to maintain external support for an agency is so great as to divert all but the ablest and most energetic executives from careful task definition.” In other words, never mind what we’re supposed to be doing, what kind of spin are we getting? CFPB Consumer Response assistant director Scott Pluta is in the crosshairs, being singled out as an intimidating manager. He was, of course, an Obama campaign worker who was awarded the position in the game of political partisanship where rewards are handed out to loyal foot soldiers. As a result, we have a muddied agency that still is defining what exactly it needs to do and is now bogged down in yet another internal investigation supported from the outside by an “independent” law firm with deep ties to Democrats. This is the agency that’s going to protect voters against bad practice in the financial sector?

In Philadelphia, your local school may become a one-stop welfare center if proposed city council legislation becomes law. The Department of Public Health, the Department of Parks and Recreation, the Philadelphia Housing Authority, and several mayoral programs that hand out food subsidies to low-income households would all be present at selected schools under the proposed bill. Why? Because “services should be provided in a coordinated, comprehensive manner, and ideally at one nearby location so that children, and their parents, grandparents, or guardians do not have to expend precious time and resources navigating from one agency to another.” These ” neighborhood-based community hubs” would “increase the likelihood that those children would thrive both in school and in their homes.” Junior, Dad, and Grandma all together collecting government handouts.

One wonders if it was a freudian admission of guilt on the part of city council members by bringing 3 generations of potential welfare candidates together at their proposed community “hubs”, or if it was a defiant salute to those who believe in personal responsibility. More disturbingly, it may not have been either. Maybe council members supporting the bill didn’t even consider the fact. Maybe they share the view of the Joseph Rowntree Foundation in the UK whose study decided that 3 generation welfare families was a myth after carefully interviewing 20 unemployed families and asking them about their aspirations for themselves and their children. The causes of long-term persistent unemployment was found to be the result of “complex, multiple problems associated with living in deep poverty over years.” And what were these complex problems? Educational underachievement, problematic drug and alcohol use – as opposed to recreational drug and alcohol use??, offending (as in criminal) and imprisonment, domestic violence and family instability, and physical and mental ill-health. Maybe these people consistently made the wrong choices and ended up ruining their lives?

Yes, poverty sucks. No, it is not easy to work your way out of poverty or to overcome joblessness, but perhaps government subsidies should not be too easy or convenient if they do have to exist. The meaning of the term entitlement deals precisely with the problem of temporary aid or subsidies to those who are truly desperate becoming seen and demanded as legitimate rights owed to the recipients on the back of working taxpayers. At the end of that road of course one finds the hideous phrase “from each according to his abilities, to each according to his needs.” This wretched slogan was in fact coined by French socialist Louis Blanc and greedily taken up and disseminated by Marx with the resulting wreckage in lives ruined or lost littered across the 20th century. Perhaps Philadelphia in reverence to its historic role in the forging of liberty and personal freedom would let its city council know that one-stop welfare shopping might not be the best solution to chronic unemployment.

As the NYPD assigns a team of dozens of detectives to solve the Brooklyn Bridge case, we are left with two main concerns. Vulnerability to terrorism is the first one; how could four or five intruders have climbed the bridge and replaced the flags, including blocking out the spotlights, without being noticed? One of NYC’s most iconic structures was easily breached. It is beyond doubt that when their identities are established and more is known, measures will be put in place to ensure it never happens again. The why will be important to find out, but the how is even more important to help the NYPD establish the right procedures to stop this type of assault.

The second concern is symbolic speech and flag desecration. A few years ago, UCLA Law professor Eugene Volokh in an op-ed piece argued that American law has long recognized symbolic expression and verbal expression as legally and constitutionally equivalent. Symbolic expressions like freedom poles – a form of protest against government tyranny – were argued in court as a matter of apeech according to the professor. The First Amendment thus conveniently protects flag-burning and other desecrations. Well maybe not. Even professor Volokh admits that many Founding Fathers placed very clear limits on the concept of free speech itself. Flag desecration would have been seen as sedition, and was prohibited accordingly. It has been 25 years since Texas v Johnson and the swing vote in that case was Justice Kennedy who was appointed instead of Robert Bork, who would have voted the other way. Perhaps what is most infuriating is that most acts of desecration are not explicitly intended to express an idea, but are a instead an intentional degrading of an idea; the values that a flag symbolizes. Joe Rosenthal’s photograph of the 5 marines and the navy corpsman raising the Stars and Stripes on Mount Surbachi at Iwo Jima is one of the world’s most popular images and for good reason. No posed sculpture or painted image can capture the purpose and valor, and deliberate, unified action of those men. Three of them: Harlon Block, Franklin Sousley, and Michael Strank gave their lives in battle in the following days. When we know the names of those who desecrated the flags that once again fly from the Brooklyn Bridge, it will be good to keep in mind those marines who gave their lives defending the Stars and Stripes. Let us hope that SCOTUS at some point places limits around the concept itself of free speech, in recogntion of what some symbols, like a flag, represent.

Concerning the Democratic Party, it would appear as almost certain that Hillary Clinton will be a contender in 2016 for the party’s presidential nomination. Now though it appears that Vice President Joe Biden is making moves in anticipation of running himself. Biden has long been rumored to be seeking the presidency in 2016 but he has failed to make any significant moves himself until recently. If Biden were to run, it would be his third attempt at securing the Democratic nomination having failed before in 1988 and 2008. Now it must be said that in polls he is trailing Clinton by around fifty points in several polls though this doesn’t mean he should be discounted so early. Biden brings with him decades of experience in government and is well liked, both qualities which generate support.

Biden recently reached out to former staffers and campaign workers, a move he described as a long overdue attempt to keep in touch. Others though see this as a move by Biden to begin laying the groundwork for a potential campaign. Additionally he has increasingly been speaking before large and influential groups such as the NAACP and the Urban League, perhaps as a way to woo minority voters which have been critical two the Democrats in the last two presidential elections. This can also be part of an attempt to become the more liberal voice of possible 2016 contenders. Where Clinton is closer to the center, Biden might be seeking to gain the support of traditional liberals.

Earlier this month Biden conceded before Generation Progress that the “hope and change” promises that were made in 2008 have failed to materialize. This can be viewed as a way for Biden to distance himself from President Obama. While any Democratic contender will be linked to the president in one way or another, the fact that Biden served as Obama’s vice president makes his situation more precarious. With approval ratings of Obama as low as they are, being the No. 2 in the administration doesn’t generate a massive flood of positive support. Despite this and other instances where distancing from the president was evident, Obama remains loyal having recently told the New Yorker that Biden would make a “superb” president.

Compared to Clinton, Biden is in a unique position in some ways. His gaffes are comical while Clinton’s make one cringe. The talk by Clinton about her fake poverty upon leaving the White House has damaged her in some ways. Biden on the other hand can continue to play on the fact that he isn’t rich, his “regular Joe,” working class background which is ultimately more endearing. While Clinton comes off as cold and calculating, Biden is affable and his typical smile brings with it a measure of trust.

Any quest for the nomination by Biden though is hampered in several ways. A Pew and Washington Post survey asked people which single word they would use to describe Biden and it was found that “good” and “idiot” to be the most used. Mind you both responses were nearly equal in number. Neither speak very positively for a person who seeks the presidency. Of course “idiot” has its negative connotations while “good” can be equated to adequate, not a source of enthusiasm. Biden himself is experienced and is a generally affable person. It is rumored that Obama has sought his opinion on a variety of foreign policy situations. On the other hand Biden is prone to gaffes and with the nature of the media, the gaffe-prone Biden will be seen more than the experienced-Biden. Also the issue of age will be brought up; if Biden were to ultimately win the presidency in 2016, he will be 74, the oldest person to ever be inaugurates as president.

Who can tell what will transpire in 2016? Personally, I don’t believe Biden has a chance to win the Democratic nomination. This despite the fact that no incumbent vice president has ever lost the nomination of their party if memory serves me correct. Biden was offered vice president for his foreign policy experience and to have a familiar face in the administration. In that role he is fine but as presidential material, I don’t believe so. I have been wrong though before. Honestly though, the GOP would have a field day with Biden if he won the nomination and I can assure one thing, 2016 will be a bad year for the left. Personally I feel that Biden will continue to show interest in seeking the nomination and pursue it to a degree but will stop short of declaring himself as a candidate right as other competitors declare their candidacies. The realization of the upward struggle he would face would lead to this decision.

Nearly 300 people are dead, their burnt and mangled remains spread out over Eastern Ukraine where someone launched a surface-to-air missile and brought down a passenger airliner. Vacationers, scientists on the way to an AIDS conference, people on a commercial flight. People who were going about their lives and trying to get back home or take a holiday, or do some work down under or in Asia. Intercepted calls seem to show pro-Russian separatists discussing the incident with a Russian official. They seem to show that the crazed separatist-terrorist who fired the missile thought the plane was a cargo plane disguised as a passenger liner, and carrying spies.

The problem isn’t just that separatists in the region are out of control. Russia is out of control. Putin is out of control. Putin and Russia are now enemies of the West. There is no way left to think of Russia as a partner anymore. Even assuming common interests in combating islamic extremism around the world. Russia is not just untrustworthy. Russia incites violence and constantly confronts the West. Reagan’s words to Gorbachev come back yet again to haunt and remind us. It is important to remember that “trust but verify” is a Russian proverb that Reagan used deliberately in the intense, intimate theatre of cold war negotiations between himself and Gorbachev. In fact it worked in the opposite direction. Verify in order to begin to trust was more like the process involved. Kerry’s pun of “verify and verify” is hardly even funny now if it ever was. There is no trust, arguably since Putin assumed office. And how can you verify if no one even claims to have shot the plane down? It is time now to mistrust and contain when it comes to Russia. The hope that ties of commerce and trade would bind us are no longer realistic. Whether Russia was involved directly with the shooting down of the Malaysian Airliner is unimportant. The violent chaos in Eastern Ukraine is Putin’s doing. The blood of this tragedy is on his hands.

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