Not a Perfect President, But a Good One

This is how it's done.

Notice that he said "I" just once, because it was never about him.

It was all about them.

Thank you, Mr. President.

Barack Obama Makes History!

For the first time in more than two centuries, the American federal government has been awarded a less than top credit rating.

After months of warnings, S&P downgraded the U. S. government to a AA+ rating from the AAA rating that it held for 70 years. It is now in the same league as Spain.

We're awaiting word from the White House of exactly how the downgrade is the fault of President George W. Bush, Mr. Obama's predecessor in office and official blame boy. Mr. Bush has been out of office for 2.5 years. Mr. Obama, his successor, has shown little inclination to accept the responsibilities but no hesitation about enjoying the perks of the office.

UPDATE: I'm reminded that it was just over a year ago that Mr. Obama's whiz-kid extraordinaire, Mr. Tim Geithner, Secretary of the Treasury and the man directly responsible for America's credit rating, said about the possibility of a downgrade,

Absolutely not,” he said. “That will never happen to this country.

Of course, Mr. Geithner is the man that couldn't even do his own taxes correctly, so what should we have expected?

Oil Price Reduction: Obama Reverses Bush Success

Under the theory that magic is only the working of that which we don't understand, the leftists in the White House must be absolutely awestruck and skeptical to the point of active disbelief by free markets. They have a much easier time with the old command/control model, where even when things don't work out quite the way they were supposed to, easy explanations came to mind. Oil prices increase without a rest for two years? No problem, just wait for a mideast crisis to break out and blame the rise on it.

This week oil and its derivatives, including gasoline, are touching record levels. Within the next few days we'll be hearing and seeing dozens of stories in the legacy media reporting the highest prices "since 2008" and we'll all know they'r referencing the days of the Bush administration and we'll get the message, "This isn't so very bad, these prices are only matching what happened under Bush."

It's true, during the final year of the Bush presidency oil prices rose inexorably, finally peaking in July 2008 at an all-time high of $145 per barrel of crude. Mr. Bush was presented a selection of possible moves that included price controls, special taxes on the oil companies, increased mileage requirements for cars, insistent calls for more "green energy." Those who suggested additional drilling for American oil were derided: Then, as now, leftists pooh-poohed any possibility of constructive market reaction to a "largely symbolic move."

Now cometh the Obama administration. They've chased American deep-water drilling rigs to Brazil and Africa. They've offered billions of dollars of taxpayer assistance to firms drilling off the South American coasts. After Shell Oil spent $6 billion preparing to drill in the Arctic, the administration pulled the carpet out from under the effort by refusing to approve permits.

A simple graphic tells the devastating story:

As a matter of real fact, the Obama administration has done nearly everything possible to raise the international price of oil and the cost for gas in this country. 

I wonder why?

I wrote about this a couple of years ago in How President Bush's Few Words Saved Us $800 Billion Annually. It's worth reading even now.

Citigroup Reneges on $100 Million Contracts, Citing Political Motivation

According to The Wall Street Journal, Citigroup has reneged on payments owed long-term employees in spite of firm contracts that the bank doesn't dispute.

The newest subsidiary of the Obama administration has followed the example of others, choosing between groups paying, those who are politically correct and shorting those who are not. Instead, the bank is betting that employees will be reluctant to pursue their legal remedies. Given that New York law allows treble damages on employment compensation matters, Citi's decision could be more expensive than it seems at first glance.

In addition, the bank also reneged on severance contracts with employees who left the bank after March 31. There's no mention whether employees were informed of the decision to short their pay prior to its effective date or whether decision was announced and applied only retroactively.

President Obama seems well on his way to spreading new ethical standards throughout the country. Unfortunately, the ethical standards he's encouraging are political, where one can say and do anything if doing so advances his or her best intentions.

If Chris Dodd loses his next election, there'll be a senior spot available for a person of his character at the new Citi.

Like Father, Like Son? The Disappointing Domestic Bushs

I once commented to President George H. W. Bush that conservatives were grateful for his leadership in the international arena but had regrets about his too-liberal domestic initiatives. He did not take it well.

Unfortunately, the same comment is even more true of President George W. Bush. His domestic legacy, defined by the oxymoron "compassionate conservatism," shares the worst attributes of both liberal and conservative approaches to government.

The St. Louis branch of the Federal Reserve publishes the nation's monetary base, which can be described simply as the money the Fed has printed and distributed into the economy. The general rule is that money supply should grow at about the economy's underlying growth rate. Monetary growth above that creates (and defines) inflation.

We'll be a long, long time digesting the politicians' panic of 2008.

Remember the panic surrounding the lead up to Y2K? The fear that the American economy would come to a complete halt because so many mainframe computers and personal computers running a Microsoft operating system might suddenly crash, leaving us without access to our checking and savings accounts, ATMs unusable, credit cards without credit?

The answer then was for the Fed to pump record amounts of cash into every branch of every bank in the country so that if all else failed customers could convert checks into dollars and then spend the cash.

That was management in the face of panic.

The current practice is management fueling panic, doing damage that will last far longer and hurt much more than the recession we're trying so hard to avoid.

The first immutable rule of economics: never look to politicians for leadership. They'll nearly always choose the wrong path while complimenting themselvings for making hard choices.

How President Bush's Few Words Saved Us $800 Billion Annually

His statement was widely described by media, pundits and even some economists as "symbolic." Barack Obama and the entirety of the Democrat leadership opposed both the remarks and their intended effect. Nancy Pelosi zigged and zagged while Harry Reid diddled.

All it took was a few words typed into a Presidential directive formally announced on July 14th to reverse a decades-old Executive Order. While nattering nabobs and elite editorialists decried the effort as ineffective, the international markets took notice, the speculators took their profits, and prices plunged.

Here, courtesy of Digital Look is a price chart for Brent light crude, an oil pricing benchmark. I'll bet you can point to the very day that President Bush made his announcement and urged Congress to follow suit.


Hint: American consumers are saving more $2 billion per day and have been saving big bucks every single day since the President's order.

Senator Dirksen is popularly credited with once saying, "A billion dollars here, a billion there and pretty soon you're talking real money." Even his eyes would widen at the costs we've borne through the years as politicians have worked to constrain, control and direct market forces.

$2 billion per day. Now that's real money.