Tea Party Babies!

I want to talk economics with you.  In the annals of the American Economy there was a golden age where we did not face a choice between Big Government and Big Business.

Back before FDR, there was a real economic theory that has died and we need to resurrect it, pat it on the back, and cheer for it like we cheer for Rick Perry.

It was called Distributism.  Yes, yes, I know it sounds like something a commie would cough up while we were waterboarding him.  It is an “ISM.”

Fear not.  It really is an old fashioned good idea.  And it is old.  Any given spell checker says, “distributism,”  it isn’t even a word.

Defintion:  ”According to distributism, the ownership of the means of production should be spread as widely as possible among the general populace, rather than being centralized under the control of the state (state socialism) or a few large businesses or wealthy private individuals (plutarchic capitalism). A summary of distributism is found in Chesterton’s statement: “Too much capitalism does not mean too many capitalists, but too few capitalists.”

This looks exactly like a progression to our Modern Internet.

In my last post I argued that what matters is that we cut the taxes of the Tea Party.  Tea Partiers tend to be Small Business Owners.  Small businesses create all the new jobs.  So, when the GOP negotiates Tax Reform, what we should really mean is:

1. The bottom half of America must pay at least as much as they pay now.
2. The Wall Street investor class and the Fortune 1000 management can pay more.
3. The owners of small businesses across the US, the savers, the scrimpers, the Tea Party faithful pay MUCH LESS.

There is a real economic thought behind this approach.

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So we got ourselves a Super Congress…hopefully, Boehner will put himself, Paul Ryan, and Joe Walsh on it.  I want the imperfect Tea Party freshman who allegedly owes child support to have a voice.   They are all likely imperfect; I prefer one who has already been sullied, and argues well on MSNBC.    But if not Joe Walsh, then tap Ron Paul.

Job #1 of the Super-Congress is Tax Reform.  This is our best chance to simplify American tax policy so a second grader can explain it.

Grover must pledge: Cutting the Tea Party's taxes matters most!

Crucial point: Grover Norquist is a good guy, but my main concern is not do taxes go up overall?

What I care about is: Do the Tea Party’s taxes go down a lot?

If we see overall tax revenues increase because GE is not getting green dollars, while all the small business owners are paying MUCH MUCH less – we have a winner.   You hear that Pelosi?  I just gave you some solace; render unto the patriots their due, and at least you can show your team some Fortune 1000 scalps.  Of course they won’t donate to your team any longer, but you should only get donations from the lower classes anyway.

Let’s be straight forward about what we want to see in a new tax policy:

1. The bottom half of America must pay at least as much as they pay now.
2. The Wall Street investor class and the Fortune 1000 management can pay more.
3. The owners of small businesses across the US, the savers, the scrimpers, the Tea Party faithful pay MUCH LESS.

Because when we say “broaden the base, end the loopholes, and lower the tax rates” – the above is exactly what we really mean.    And we can’t let Grover Norquist’s Tax Pledge screw us up.

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I’ll keep this short.

No one understands “what” is going to be cut.  Saying discretionary spending is going to be cut over ten years sounds like a Nigerian email scam.

So please Boehner, for the love of god, listen to your buddy Morgan…. Just cut federal employee pay.

Give Obama three choices:

1. Cut Federal Employee Pay in every department except Military by $30B per year (off baseline) starting 2012:  Ten year savings $300B

2. Cut Federal Employee Pay in every department except Military by $60B per year (off baseline) starting in 2012: Ten year savings $600B+

3. Cut Federal Employee Pay in every department except Military by $90B per year (off baseline) starting in 2012: Ten year savings $1T+.

Make Obama choose.  He can’t win.

Tell him that if he chooses low, when the credit card is maxed out again, he is getting the same deal next time.   Suddenly, ALL  Federal public employees are with our program.

Overnight, the entire Federal workforce will be desperate to help Republicans make real cuts.   Overnight, our “servants” will be finally pushing out the deadwood, over the howls of their union bosses.   Let’s get public employee interests aligned with the public.

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Sen. McConnell’s contingency plan on the debt ceiling is to pay $2.5T to topple Obama.  And if I were 100% SURE it would end IMPOTUS, I’d support it.  But since there is no guarantee, it’s better to gird our loins and prepare to fight Obama with a no new taxes plan.

The bigger issue with McConnell is that he didn’t run his plan past the Tea Party, Boehner, and Cantor first.   Since we run the House, that means the Senate should take its cues from our riotous freshmen, whether they like it or not.

Right now, Republican Senators are the weaker sex.

What is truly awesome is that there is an easy way for Rep. Cantor to prove his Tea Party bonafides and smack Obama right back after the challenge he received:

Yesterday, House Majority Leader Rep. Eric Cantor used colored-coded spreadsheets to detail $2 trillion in spending cuts he asserts were agreed to by the Biden group. The President asked Cantor “if he wasn’t missing a page”, meaning the revenue aspect of the Biden talks. Cantor also proposed $350 billion in additional mandatory health care spending cuts. Obama pointed out that this $350 billion still isn’t enough to get the $2.4 trillion in savings necessary to solve the debt ceiling crisis through 2012.

OMB disputed Cantor’s numbers, citing, at most, only $1.7 trillion in potential spending cuts tentatively agreed to by the Biden group. By either side’s arithmetic, negotiators are left with a $400 – $700 billion gap – a huge amount by any standard.

Then, on July 13th, Obama sent Cantor back to  the drawing board again, by actually walking out on the debt ceiling meeting.

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Ok, Tea Partiers… this is a gift from the Guerrilla Hacker Gods – so please pass it along.

Obama’s team has decided to “raffle off” dinner with IMPOTUS.  That’s right… you can sit and tell the President directly to his face what you think about his agenda for America.

Here’s the fun part :  To make sure it doesn’t  run afoul of gambling regulations it is established essentially as a sweepstakes, which means “No purchase, payment, or contribution necessary to enter or win. Contributing will not improve chances of winning.”

The more Tea Partiers who enter, the more Tea Partiers are sitting at the table.  I’m sure we can push for open data on how many have entered in each; so we can make sure they haven’t juked the stats.  Once you run a sweepstakes you are required by law to give no favor to any entry.

Here are the rules.

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Mitt’s not my first choice.

If Perry (c’mon Governor!) doesn’t run, I prefer(ed) Daniels and Christie because they are heroic public employee  union slayers.  And I love Drew’s dream Tea Party ticket of Cain and West to confront Obama’s cheap thinking: Black = Socialist.   That’s a winner, too.

Make no mistake; there are lots and lots and lots of ways to beat Obama.

But the issue at hand is Romney, and far too many who claim the mantle of the Tea Party are not being honest about blue state Republicans. We have to grow up.  Romney can wipe the floor with Obama.

Does ANYONE think that if Mitt were Governor of South Carolina, he’d have overseen the creation of the Massachusetts healthcare law?

Of course not.  Romney did what a Republican in MA had to do to be the Governor of Harvard Intellectuals:  He gave them the most conservative market-driven universal healthcare plan he could.   If Mitt Romney were President, he’d be far more conservative than he was as Governor of Baby Blue Massachusetts.

And folks screaming RINO need to stop.   Now.

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New from Econ Stories (an Emergent Order joint) the music video Paul Krugman refused to pole dance in….

In my last post, I explained the best way to end unemployment is an Ebay / Paypal style solution to auction off the “Man Weeks” of our unemployed:

1. All registered workers are guaranteed an income of $10,400 per year, at least $6 per hour.  The minimum bid is $1, and the government uses current Unemployment Insurance I monies to add up to $5.
2. Current UI ends after 90 days.  To receive any extra aid of any kind (food stamps, Section 8, energy assistance, etc.) able bodied workers must register in this system. They receive a Debit Card where their pay is deposited every Friday.  They can choose to earn less, but they cannot decline to work and get GI.
3. We are all allowed to bid on any worker’s Man Week, as long as we have first deposited the money to cover the bid in the system; no credit will be extended.  This bid covers employer taxes, workers compensation, everything soup-to-nuts.

Below you will find the pay schedule I’m suggesting, but first I want to talk about a gorgeous side effect of this plan: it ends illegal immigration.  In fact, it actually causes current illegals to deport themselves.

The reason is simple: When farmers can bid $4.00 per hour to have unemployed American citizens pick the grape crop, they will no longer hire illegals.  You get the drift?  Immediately, there will be no jobs open to illegal immigrants.  Since (in this $4 case) the government is adding $3.50 per hour, the US citizen is earning $7.50 ($15,600 per year).

We’ll leverage the extra pay provided by the government (money we spend anyway) to end demand for non-citizen workers.

Notice that we don’t need to staff up the Immigration Department to chase down coyotes; we don’t need to raid companies looking for illegal immigrants; we don’t need to build a wall across Mexico; we don’t need to waste time passing harsh laws.

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I’m about to perform a healing.   For those non-believers out there… like magic, it will terrify and then delight you.   Maybe it’ll scare the jesus into you.

I warn even the staunchest Christian; this will test your mettle.   It will clench your teeth and stiffen your spine.   But, Tea Party babies, I love you!   Have faith!  This idea will end unemployment, and the Fed will never be allowed to print money again.   In God We Trust.

And God wants us to provide every unemployed American citizen a Guaranteed Income of $10,400 per year.

Fifteen million Americans are unemployed.  Even if this program INCREASES the number of people calling themselves unemployed, I want to guarantee all of them, as long as they choose to stay in the program, a check from the Government for $200 per week.

But, there’s a catch.  God’s in the details…

Instead of 99 weeks, Unemployment Insurance will end at three months.  After it runs out, the unemployed will be allowed to enter our new Guaranteed Income system:

1. There’s no more minimum wage.
2. They have to take any job offered.
3. If  they slack off at work and they keep getting fired, they are out of the program.
4. Payments decrease to zero as they earn towards $9 per hour– but on a schedule that still incentivizes them to earn more.

Once someone is in the Guaranteed Income program, their resume goes into the GI website, and if you offer them $2 per hour to pick up dog sh*t in your yard, they pick up dog sh*t.  If a call center offers them $3 per hour for forty hours, they earn an extra $120 per week.

Poof!  There’s no more unemployment.  God said, “Let there be light.”

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President Obama made a giant error in letting “never had a real job” Timmie Giethner and “heck of a job” Larry Summers slither around his administration’s neck in 2008.  Lucky us.

We must not make the same mistake.

We need to fix this thing… and Freedom Works’ Dick Armey is the man to do it.

That’s right–in the ultimate act of true bipartisanship, I want Dick Armey and Barrack Obama to agree we should re-instate Glass-Steagall.

In 1999, Glass-Steagall was repealed and commercial banks and investment banks were finally free to debt-molest us the “slack jawed rubes.”  Like incestuous Wonder Twins, they became Too Big Too Fail.

The problem with “bankruptcy” as a TBTF solution is that we cannot predict who will be in the White House or running Congress when the next financial crisis hits.  But with Glass-Steagall back in place, we have far less to worry about…. Goldman Sachs will no longer be our Treasury Department.

It also means we’ll be free to repeal Dodd-Frank Wall Street Reform without hearing Obama whine about consumer protections.

The fact is in ten short years, after we ended a 37 page law, we got screwed with our pants on, and replaced it with 2319 pages of VCR instructions (kids ask your parents) written by banker lobbyists to employ lawyers.

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The contractual mortgage screw-up by the banks gives us a great way to speed up the recovery and reclaim what was lost in the the Great Bank Heist of 2008.

If you haven’t been paying attention to the MERS violations, you’ll need to read up to understand this idea…

But essentially, the chain of title on almost all the foreclosures going on in the mortgage market are in jeopardy: lawsuits as far as the eye can see; title companies unwilling to insure title; squatters; banks suspending all ongoing foreclosures.

It’s a frigging mess.

Meanwhile, ever since Rick Santelli launched the Tea Party on CNBC, we’ve been split down the middle class between those people who bought too big a house and are now desperately underwater–and those people who played by the rules.  We all have friends in both groups.

Over at oligarch central (the Fed), Bernacke is suggesting that to kick start the economy we need more inflation.  After all, the mortgages behind all the toxic assets they bought aren’t worth squat if home prices fall and people stop making payments.

I have a Tea Party solution…. and it is one Obama either gets behind or is exposed once-and-for-all as a Wall Street Stooge; his own left flank will desert him if he fights it.   It’s radical, and there will be howls from the Wall Street crowd, but to Main Street Republicans this could be a silver bullet.

The incoming Republican House should draft legislation, making it clear to the Credit Reporting Agencies that MERS Violations are valid grounds for removal of a foreclosure from credit reports under the Fair Credit Reporting Act.  If title companies aren’t willing to insure title, then Credit Reporting Agencies shouldn’t accept the validity of the foreclosures either.

The goal here is to encourage those underwater on their mortgages to mail in the keys, accept the foreclosure, stop squatting, without the ding to their credit – so they can buy a cheaper house later.

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The challenge for the Tea Party movement is to identify specifically: What would you do?” the president said. “It’s not enough to say ‘get control of spending.’ I think it’s important for you to say, ‘I’m willing to cut veterans’ benefits,’ or ‘I’m willing to cut Medicare or Social Security or ‘I’m willing to see taxes go up.’

Ahem, can we please stop letting Obama get away with this false choice?

Can we please just start saying, “I’m willing to cut Public Employee Compensation (PCE) at the Federal, State, and Local level by 25%.”

Can we please just start saying, “Mr. President, HOW DARE YOU give us a false choice of new taxes and cuts in services?”

25% cuts in PCE are not draconian; they are common sense:

1. We get rid of the least productive 10-25% in every department, like businesses do when times are tough.
2. We increase the hours worked by Public Employees (by 10%) to match the private sector.
3. We outsource responsibly to private sector companies that are chomping at the bit to replace fat bloated government.

With 25% cuts in PCE, the savings are close to $300B annually, and that’s AFTER we spend $100B letting private companies bid to replace the services currently provided by public employees.

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Democrats have been protesting that only 3% of small businesses are affected by the Bush tax cuts…  this is technically true, it is also true that almost all the small businesses that create jobs are part of this 3%.  The unspeakable truth is that wealthy small business owners are the only heroes we can turn to in this economic crisis.

So, the incoming Republican Congress needs to take swift and decisive steps to hand Obama a tax cut bill that he cannot veto.

In light of this, it would be a mistake of epic proportions to get tangled up in arguments about extending Bush’s tax cuts to the wealthiest Americans.  Instead, the GOP ought to come out in favor of Progressive Corporate Taxes.

I submit that more than any other long term tax cut, Obama will have a harder time arguing against this proposal – because it just smells like a jobs boom.

Corporate taxes stay the same for companies earning profits over $1BILLION.

Companies earning under $10 MILLION pay no taxes.

For earnings in between $10M and $1B there is a graduated tax schedule.

This is a slam dunk for Main Street.

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I have a hypothesis about the “New Normal” economy we face. Most, if not all, of the unemployment crisis can be blamed on Public Employees. A bold statement to some…. but on paper it looks suspiciously valid.

Essentially, upper and middle taxpayers have always paid the tab for government. But historically we have paid civil servants less money.  And the amount they are now overpaid is very near how much our unemployed have lost in wages.

Public employees are stealing from the poor and lower classes. Republicans need to make this message clear as day.  Why they don’t astounds me.  Is Chris Christie the only politician with elephant balls?  You too, Paul Ryan, stop screaming you are being picked on, and stand for something IMMEDIATE with teeth.  Win my plan, and then we can win yours.

If we commit immediately to significant productivity gains in the Federal, State, and Local Government, we could have ZERO UNEMPLOYMENT.   With the easily achieved gains ($369,462,330,189) I describe here routinely, we could pay each of the 15 MILLION unemployed $24,600 per year to go out in their backyards, dig holes, and fill them up.  Do the math.

These, of course, would just be Obamajobs.  So imagine how much more could be achieved if, instead, we put the savings to good use — say cutting corporate taxes to zero, further reducing prices, and allowing consumers to have more to spend elsewhere – creating real jobs, the right way.

But that’s not specific enough proof, instead let’s look the real lost wages of the unemployed and see how close that amount is to what we overpay for government .  To do this, I pulled data from the Center for Labor Studies. First, I sorted the number of jobless in each decile of 15M unemployed, and then established how many hires would be needed to achieve Full Employment (4%) in every single decile.  Then I multiplied each group by their median lost wages.

Overpaid: $369 BILLION.  Lost Wages: $306 BILLION.

Holy Shit, huh?  Turns out this stuff isn’t complicated. Pay public employees too much money, and you don’t have enough cash left over to run the economy at full capacity.

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A good looking, fun loving guy sits down and writes a few blog posts about how to ensure the Republican Party wins both houses in a 2010 landslide, and beat Obama’s ass in 2012… he figures his job is done.

Sure, York at the Examiner will pick it up… but apparently, on this Internet thing, you might have to say things twice to actually get a Minority Leader to read the script.  Something about, “going virus.”  So uncover your mouths, I’m going to sneeze.

There is no reason to get trapped in a vote-losing song and dance about, “What will Republicans cut,” when asked for specifics on Sunday Morning shows.  (Side Note: Amanpour curdles the soul.  George Will sitting next to her during this toxic experiment will be doing god’s work.)

Ok, you are covered in pancake makeup sitting under a 500W Grow Light, and then sure enough, here it comes: “What will you cut?”

Throw back your head, laugh maniacally, and cackle, “Public Employees!”

Er, no, instead say, “We certainly are not going to cut any public services; for the amount of money they pay, the taxpayers shouldn’t have to give up a single damn thing.  But when Republicans take over Congress, we’re going to run government like a business. And the way we see it, the shareholders are the voters, elected officials are the management, and the Public Employees are overpaid.

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A recent blog post by economist Scott Sumner got me thinking about another way we could quickly improve our government.

We should require Public Employees to take personality exams before they are hired.

At issue is human “spite” and how it affects economic development.  If you’ve ever dealt with public employees, certainly you know them to be some of the most spiteful monkeys in the barrel.   They are capricious and angry, they forget who they work for, and they wield power arbitrarily.  Somehow, you feel lucky when they actually do their jobs.

Caveat: Some aren’t bad.  But WHY do we have to accept it at all?

Yes, firing them is next to impossible, but setting up new rules for hiring them is easy as pie.

The GOP should promise to establish a Civil Service Personality Exam for all public employees that weeds out those who don’t realize their job is to make private life easy.

What would the test look like?  This:

In a trade, you can receive either

1. $5 while your trading partner receives $4.
2. $4 while he receives $1.

In a trade, you can receive either

1. $1 while your trading partner receives $10.
2. $0 while your partner receives $5.

To grade this test we just need the definition of economic spite:

A spiteful individual is willing to forgo material gains from trade unless the terms of trade give him a large share of the pie.

So if someone doesn’t say #1 to both questions, she does not work for the government.

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I don’t care if he sleeps with SEIU and AFGE, mad props to my favorite cartoon character….  Baby Huey.

Audit The Fed.

Many fine Republicans argue we should privatize Social Security.  Just like George Bush – they are right.  They are noble.  They are dust.  The last time we mentioned it, we found our ass booted around our neck.  An obscene daisy. Ripe for the picking.  Smelling like death.

Not me.  I prefer to get in the mud, fight the weakest midget in the bar, and End Him.  I will fight dirty.  Because “defense of liberty demands extreme vice.” Or something.

Either way, we can always use a trick shot for 2010, and our trickiest shot is GOV2.0.

GOV2.0 loves the GOP.

If we were a boy band, GOV2.0 would throw her panties on stage.   And if we sing her a power ballad and hold all the right notes… GOV2.0 will certainly bring her hot friend, “Private $$ Accounts”, back to our room  for a threesome.

So pull on your spandex, Mike, and let’s go yodel in the valley.

The Social Security Administration has 64,000 employees, spread out over 1,600 local offices.   In 2009, it handled 42MILLION in office visits, and fielded 57MILLION calls.  Each customer makes one call and one office visit per year.

Yawn! The average McDonalds deals with 15X the number of customers an SSA office deals with daily… and they are open on holidays with a smile.

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In my last article, we began a discussion of GOV2.0.  Over the next couple weeks, I’ll sketch some sexy details.   Commenters, keep tossing out your ideas.

Tea Partiers!  Here’s how to save every state budget.  Let’s hoist our pirate flag high.

In New York City a movie ticket costs $15 – about $7.50 a hour.   Three months later it is out on DVD, and you can own it for $15.  Twenty eight days later, you can put it, along with thousands of other movies, in your Netflix queue for $9 a month.  Eighteen months later, it plays on HBO, along with a great show about having multiple wives, for $10 a month.

Or, if you prefer, you can download a watchable copy of the movie the day it comes out for free… because a lone pirate secreted a HDcam into a theater and jacked into the hearing impaired outlet in his seat.

The movie cost $150MILLION to make.  The hooligan did it for free.

And oh, by the way, if your kid is still buying music, you might sit her down for a talk about the virtues of sharing.

For the rabid capitalist, it is crucial to recognize that property rights emerge from the scarcity of the atomic.   There is value in creative ownership, but let’s be rational… if we could copy land, food, and oil, the concept of “ownership” would be radically different; there would be riots in the streets if limits on these staples were artificially enforced.

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Right off the bat, hear my barbaric yawp: “Less Government!”

I want to strip the bark off and tenderize the tough meat of Uncle Sam until he heels without so much as a cross look from likely voters.   I want to make government our bitch.

So to those who are terribly angry – relax, I’m on your side.   That said, it is time for Republicans to start talking about a new theory of government.

Listen up, Luntz!  The phrase we need to drumbeat is GOV2.0.

Republicans need to stand for MODERN GOVERNMENT.   Breathe.  Don’t freak out.  Supporting government in any form right now is not heresy, and acting like it…  is political suicide.   We have to put forward plans that work, plans that will save Medicare, plans that can save Social Security.   This is the way to win deep gains in purple districts, lock in the elderly votes in FL, and get the young urban turks to stop and take notice of the GOP.

Ask yourselves:

1. Are private sector unions strong in MODERN AMERICA?  No.
2. Have massive productivity gains reduced headcount (and prices) in MODERN COMPANIES while increasing value?  Yes.
3. Can we find jaw dropping savings in MODERN GOVERNMENT? Yes.

This is not “waste, fraud, and abuse.”   This is not John McCain going over the budget line by line.   We need to laugh at those concepts.   Ho-ho, Barry. No, we’re talking about firings.  Reducing headcounts at government agencies, bringing in new web based technologies, outsourcing public services to non-union private contractors.

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