Keep the government out of the CEO's pockets!

Before you write a lengthy response to the title of this blog and accuse me of supporting 'greed' and the 'ultra-rich,' allow me to explain myself.

Big government has led us into a situation that I can't see ending well. Public outcry about excessive executive salary has been going on for years. "Why should they make $1,000,000 and the worker only make $20,000?" "They don't do more than the average worker!" The comments go on and on and on. I think people need to look at this from a totally different perspective instead of believing they are getting jipped or ripped off.

Let's take a look at just a small business. Let's say there is one owner and ten employees. Let's say the owner has stepped away and there is one head manager of the business. The owner is totally non-involved in the day-to-day operations, but obviously keeps tabs on how the business is doing. The owner decides how much the manager and employees make. So we have this established: the owner decides how much the employees of his company gets paid. Fair enough?

Now, a corporation is just a very large business that has many owners. These owners ELECT a board of directors, who then approve compensation of executives among other things. The board of directors answers to the stockholders (the owners). The owners are the ones who are financially linked to the performance of the company, and since it is THEIR business they should decide how much the executives should be compensated.

People who argue about employees being compensated too much really should not be upset about this compensation. The only people who have a credible argument when they complain about executive compensation are those who are stockholders. Further, the stockholder should not expect the government to intervene, or some other third party, as it is their responsibility to vote in directors who have the same opinion of lower executive pay. If someone complains, "Oh, Disney executives make so much money it's just wrong!" Well, are you an owner? If not, then why are you complaining? It is not your operating revenue going to the executives. It is the stockholders' who could be getting that money in dividends.

But of course, people turn to the government to solve this 'problem.' I personally do not see the problem. If the shareholders would rather pay executives extreme amounts of dollars for their service instead of receiving that extra revenue in dividends, then what is the 'problem'? So we have all these people complaining about executive compensation most likely with the false notion that if the executives did not get paid as much that it would go back to the employees. But it won't go back to the employees in the form of higher wages. It will go to the owners!

Now we have this strange situation where the government has injected money into companies, which has caused two things: 1) Dilution of stocks 2) Government having 'stakes' in companies. Now with the government owning these stakes they feel like they're influence must be felt, so they want to cap executive compensation. I believe people think that after this happens that 'working class' wages will rise. As I said previously, this is not what is going to happen.

Once again, government intervention has made a mess of things in the private market. Let's hope that enough Americans find the common sense to see the false premise of the war against executive compensation.

Bobby Jindal's Response to Obama

Below is Bobby Jindal's response last night to President Bush. Presidential Material? That is yet to be seen. Luckily for him, he has a few years.

Part 1


Part 2

"Not because I believe in bigger government, I don't." - Obama

As many of you know, Obama made his first address to Congress tonight. This address was concentrated nearly entirely on the economy. He started out by talking about the sorry state of our economy, and how it is affecting everyone either directly or indirectly. He reiterated the point that America will prevail and recover. I don't doubt that we will prevail and recover, but not because of Keynesian economic policies that the Democratic Party is implementing. Not because of the spending, bailing out, and intervention of the Federal Government.

He criticizes CEO's for taking taxpayer money and then flying in private jets and padding their balance sheets. He said that those days are over. Instead of applauding a governmental plan that will now limit the spending of the top executives of companies, we should be asking: Why are these banks getting taxpayer money anyway? And how can the federal government expect a company to change its ways when they have just set a precedent of bailing out any failing bank as long as they are 'too big to fail?' Instead of trying to control these companies and giving them taxpayer money, the free market would force them to make changes or simply fail. Instead of having a job as a CEO, they will be out looking for jobs with the rest of the employees who have lost their job. The top executives and board of directors should answer to stockholders (the owners of the company) instead of the federal government who is fatally inefficient and ineffective.

He rejects the notion that government's role does not include intervening to bring the country out of a recession. He is basically saying, I reject supply-side economics and I approve of Keynesian economic policy. When has Keynesian economic policies ever worked? It prolonged the depression of the last 20's into the 30's, and it will prolong this depression as well.

A few comments concerning the address:

Obama said we need to 'take responsibility for our future once more.' How is spending money that we surely cannot pay back for years to come taking responsibility of our future? Think about it: we just passed a spending bill that cost nearly a trillion dollars even though our nation is deeply in debt. We are the biggest debtor nation in the world. Our country is deeply in debt, and instead of drastically cutting spending we are drastically increasing it.

"We import more oil today than ever before" - Drill Alaska and offshore, that would help us move towards a more independent America.

Our schools are not preparing our children to compete in the global economy - School vouchers would give parents choices for their children, increase competition, and therefore increase the quality of our education. Why not give it a chance? Clearly our current system is not working effectively.

Energy Policy - He wants to put a cap-and-trade system on carbon emissions. This is not going to help promote business, but make business more expensive. As if our extremely high corporate tax isn't enough to drive business out of the country, this will surely make America even less attractive for business.

Higher Education - He said he wants every American to go to at least one year of higher education. This simply is not possible. Not everyone needs to go to college; it does not make sense for everyone to go to college. I point to Michael Powell's article "College is Overrated," where an argument is made against higher education. Also, he foreshadowed the inevitable push we will see within the next two years where service for school is going to be grandfathered in, eventually resulting in mandatory service for all 18-25 year olds.

"Not because I believe in bigger government, I don't." - Ironic. How can he say that? Most everything he supports results in bigger government.

After listening to this address, the sharp contrast between Obama's policy and true conservative policy could not be more clear. There was very little I heard during this address that I truly agreed with. The liberal agenda is in very sharp contrast to the cause of liberty. Though the current policy of the Federal Government is in such opposition to the cause of Liberty, I see hope in the message of liberty. The message of liberty is popular. The message of liberty is growing. Above all else the message of liberty offers true hope and change. President Obama, you can pursue your policies, grow the size of government at a rapid pace, and even increase government intervention in the free market to an all-time high, but I will choose to align myself with the cause of liberty, limited government, and the free markets.

Ron Paul's Weekly Radio Address

Check it out, much better than Obama's weekly address ; )

I Support Throwing the Chronically ill in Prison!

Did I get your attention yet? If you are wondering what these chronically ill individuals would have done that is so heinous that I would want them to suffer in prison, you might be a little shocked to hear what it is: they smoked a plant!

Okay I lied, I don't really support imprisoning the chronically ill for smoking a plant, but many people do. I am talking about medical marijuana. In my home state of Minnesota it has been reported frequently on the news (both radio and television) that it is a very likely possibility that there will be a bill on Governor Tim Pawlenty's desk that would decriminalize the use of marijuana for medical purposes. He has constantly stated his opposition to such a bill. Pawlenty, who was a key member of John McCain's team when he was running for the Presidency not too long ago, most likely would state the same reasons McCain did when the question was brought to his attention at his numerous town hall meetings: Marijuana has not been proved to be as effective as other drugs in treating chronic pain.

This is an inadequate answer simply because that is not the point. I'm not sure about the United States you have been living in, but I was not aware that if a plant could be used as medicine, but that medicine was not 'proved' to be as good as other drugs, that we then outlawed that plant? The root of the issue is whether or not governments should be allowed to outlaw certain drugs and imprison those who decide to use these 'illegal' drugs on their bodies. I would like to hear Governor Pawlenty explain how he justifies keeping the drugs tobacco and alcohol legal while supporting the continued criminalization of marijuana use.

It simply does not matter whatsoever whether marijuana is 'more effective' medically than other drugs. Tobacco is estimated to kill over 400,000 in the United States each and every year. That is the United States alone. There are no positive benefits of smoking tobacco, yet it is legal. Shouldn't Tim Pawlenty be pushing for tobacco to be made illegal, based on his rationale?

To get back to my point, how can someone say they care about the sick and dying when they support policy that literally imprisons individuals for using these drugs to alleviate chronic pain? It is bad enough that we are limiting people's freedom by waging a war against those who decide to use a given drug, but imprisoning those who have chronic illnesses who have turned to marijuana to alleviate their pain?

The Founding Fathers would not believe it.

How Will This Stimulate The Economy???

Obama's weekly address:



What I can't stand about these big-spending Democrats (and a choice few Republicans) is how they hardly explain how this "stimulus" bill will actually stimulate the economy. He talks about updating our infrastructure, schools, etc. but that is just regular old spending. Those who are in favor of tax cuts can actually make an argument that the cuts will stimulate the economy (they have in the past). But this is just another New Deal big spending plan, which FDR's treasury secretary said, in 1939, did not work. The direct quote, "“We have tried spending money. We are spending more than we have ever spent before and it does not work.”

Congressman Paul's Reaction to Stimulus being passed

What I find most astounding about this bill is that the Legislators were not even given copies of the bill to read! What an amazing day and age we live in where people are actually voting IN FAVOR of legislation that they have not read. How can you vote for something you have not read? Especially if it is over 1,000 pages?

American Students 'biased' Towards Capitalism?

In this week's edition of The Aquin, the St. Thomas weekly school newspaper, there was an article written by Rebecca Omastiak titled "Obama may help renew St. Thomas' Cuban ties." Basically it talks about the history the past couple decades between St. Thomas and the University of Havana, which includes Dean Dennis Dease visiting in the early 1990s and about 20 faculty members in 1999.

It then addresses the possibility of exchange and study abroad programs between our own University of St. Thomas and University of Havana. This is where a quote is made that is quite off-topic i.m.o. in which a student said, "American students have a natural bias towards capitalism, and it would be good for them to see a different system." As government intervention and regulation of the free market in the United States becomes more and more intense, we hardly are living in a truly capitalist society. Ask anyone who has tried to start a business recently about all the regulations they must adhere to. Just look at our income tax system: in a truly capitalist society, there would not be a tax system that punishes and takes away incentives of creating more wealth.

By all means, I think it is good for Americans to see a 'different system,' it is important to keep in mind we are hardly a truly capitalist nation. And this bias towards capitalism of American students this student speaks of is hard to justify with the overwhelming support the Democratic Party (and Obama specifically) has on college campuses. This would seem to be in contradiction to the students claim. If anything, they are biased away from capitalism.

Low Taxes Attract $$$$

As I have said before, The End of Prosperity caused me to become an even bigger advocate of low taxes. In today's world, each state in the United States is in effect competing for citizens and business. The more business and people they can attract, the more tax revenue they can bring in and arguably the more prosperous that state will become. People (for the most part) are very mobile. I have heard somewhere (yet I do not have a link so you will have to trust me) that today people move an average of seven times during their adult lives. That is quite a significant change from the generations before us! Besides just people moving around towards low tax areas, businesses are and have been doing this for quite some time now.

Here is just one recent example of business being attracted to a low-tax state: TCF bank is moving its headquarters to South Dakota from Minnesota. From KSTP, "The bank said the move is for regulatory reasons only and that no Minnesota jobs will be lost." Purely regulatory reasons. Hmmm, these regulatory reasons would not have anything to do with the fact South Dakota is much more tax friendly than Minnesota, would they? I'm sure they do.

Whether it is homeowners moving across the border from California to Nevada, businesses headquartering in tax-friendly countries, or even TCF moving their head operations to South Dakota, low taxes will always attract capital.

'Mad Money' Host Jim Cramer Gives Stimulus an 'F'

Even Cramer thinks this 'stimulus' package is a horrible idea!

The Fed in Minneapolis is Against Bailouts/Stimulus!

Okay, not exactly. The paper clearly indicates it is the express view of the authors and not that of the Minneapolis Federal Reserve. But check out this abstract from a paper posted by Timothy J. Kehoe (University of Minnesota, Federal Reserve Bank of Minneapolis, and National Bureau of Economic Research) and Gonzalo Fernández de Córdoba(Universidad de Salamanca):

"Studying the experience of countries that have experienced great depressions during the twentieth century teaches us that massive public interventions in the economy to maintain employment and investment during a financial crisis can, if they distort incentives enough, lead to a great depression."

It's ironic that a branch of the Federal Reserve has an economist who advocates the exact opposite of what we have been doing. Wake up people this intervention is making things worse!

"Stimulus" Passes Senate 61 - 37

Sure enough, the three Republicans (Collins, Spector, and Snowe) who were expected to vote in favor of the stimulus followed through and allowed the stimulus to pass. Considering the fact that the Republican party has not been all that 'fiscally conservative' in the past oh decade, the message can be heard loud and clear that this bill was clearly something that no conservative could justify approving. At least now we know who DEFINITELY is not conservative.

I like to see the roll call of who voted in favor of what (it's usually more interesting in the house were there are always a number who cross 'party lines') and I think that if more people paid attention to this they would get a better view of what their Congressmen and women really stand for.

Government is the only choice to resurge economy! What?

I heard this on the radio during my morning drive. It's from Barack Obama last night speaking to the media:

"But at this particular moment, with the private sector so weakened by this recession, the federal government is the only entity left with the resources to jolt our economy back into life. It is only government that can break the vicious cycle where lost jobs lead to people spending less money which leads to even more layoffs."

What??? This statement is just false. "The Federal government is the only entity left with the resources to jold our economy back to life." Sorry Obama, but I'm not sure if you realized this yet (well, obviously you have not), but the government receives it's resources from the private market. The government is not a for-profit business, it survives solely on the private market for it's income. That being said, how is the government the 'only entity left' with resources that can miracoulously 'jolt' our economy back to life? Am I the only one dumbfounded by these ignorant comments that are simply wrong.

No President Obama, government is the least efficient entity that can 'spend' money in such a way that will 'jolt' the economy. The money is being taken from the private market and potentially efficient if not efficient means to an entity that inevitably spends money inefficiently.

Conservatism - Alive and Well

As I have written in my previous post, I am not buying into Susan Collins (Senator from Maine) as a "real" Republican. She is one of the three Senators (Arlen Specter, Olympia Snowe, and Collins) who are going to push the Senate over the sixty required votes to pass the ‘stimulus’ bill (and I’m already predicting a number of future Liberal bills).

During the election the media made a big deal about whether or not the Democrats would get sixty Senators voted into office to give them a super majority. What does it matter? As long as Susan Collins and a couple other Senators are ‘Republicans’ they can pass any legislation they want! Perhaps I am too pessimistic about Collins, but give me some sort of evidence to give me hope for this liberal Republican (it just sounds wrong, doesn’t it?). Collins support of any given liberal bill should definitely not be seen as bi-partisanship, or even something out of the ordinary i.m.h.o.

Now, I do see one positive in the passing of this bill: this is entirely on the liberal, Keynesian, Democrats’ shoulders. Unlike the bailout where there was, sadly, support from both sides including a “Compassionate Conservative” i.e. neo-con president, this bill cannot be blamed on the Republican Party (granted, if it does succeed, the Democrats get all the credits. I would NOT want to be on that side of the table, though). Congratulations, GOP, you acted fiscally conservative when it comes to government spending!

Needless to say, I am excited about the GOP rallying under the Conservative banner. As for “Republicans” such as Susan Collins, I suggest you rethink your party.

Susan Collins - I think you are a Democrat, not a Republican!

Susan Collins, a "Republican" Senator from Maine, is one of only a handful GOP Senators who might approve the massive spending bill the Democrats and Obama Administration has been pushing the past couple weeks. My major question: Is she a Republican? After looking at her stances on issues, she seems to be in favor of big government.

Now, I know what some might say, "the neo-cons are all in favor of big government!" But hear me out. Neo-cons and liberals alike are in favor of big government, but most neo-cons are pro-life. Susan Collins basically is against any limits on abortion. She even "Voted NO on banning partial birth abortions except for maternal life. (Mar 2003)." Come on, even if you are on the fence whether or not the government should be intervening when it comes to abortions, we should at the very least have a consensus that partial-birth abortions should be banned.

I think Republicans are finding their conservative principles. I applaud all the Congressmen and women who have stood up and recognized this bill for what it is: a massive spending bill. The worst part about this whole situation is that it is meant to 'stimulate' our economy. How can taking nearly a trillion dollars OUT of the private sector and putting it into the irresponsible hands of government to spend as they please 'stimulate' the economy?

Check out this great quote from Arizona Senator John Kyle:

If you knew a bill in the U.S. Senate would cause a recession in 10 years, would you support it?" asked Sen. Jon Kyl, R-Arizona. "That's what the Congressional Budget Office, the bipartisan office that supports our efforts in the Congress, says about this legislation. ... There will be negative [gross domestic product] in this decade as a result of this legislation.

Here is the problem with 'compromise' on this spending bill: Conservative and Liberals have fundamentally different views on how to 'fix' the economy. Conservatives (now, I'm not speaking for all the neo-cons who have grown the government the past decade, but true Conservatives) believe that government intervention is just going to make it worse, and spending billions upon billions (possibly trillions) will just prolong the private market recovery. Liberals (for the most part, especially the ones in office today) believe in Keynesian economics which has the belief that the government can spend it's way out of a recession.

From this we can easily see that anyone who votes for this bill but calls themselves 'Conservatives' are simply contradicting themselves. I'm sorry, Susan Collins, you are not Conservative and your 'leaving the partisan politics to get things done' is actually you just re-affirming yourself as a big-government liberal. Below is from CNN:

Tax cuts include incentives for small businesses, a one-year fix of the unpopular alternative-minimum tax and tax cuts for low-and-middle-income families, said Sen. Susan Collins of Maine, the most prominent Republican negotiator in the bipartisan talks.

"Our country faces a grave economic crisis, and the American people want us to work together,' she said. 'They don't want to see us dividing along partisan lines on the most serious crisis facing our country."

I suggest you quit trying to pretend that you are a Republican, since you clearly align yourself with a liberal ideology. You would be doing everyone a favor by running for re-election as a Democrat and letting the people actually have a Conservative choice in the next election.

It's Just Really Bad Legislation

Michele Bachmann posted a great blog in response to Obama's recent criticism of Republicans actually acting as fiscal conservatives when it comes to the 'stimulus' bill. It's a nice short read, I hope you enjoy!

Glenn Beck: Obama's 'Change' = Socialism

A great clip where Glenn Beck talks about how Obama's Administration (as well as the liberal-dominate Congress) are going beyond liberalism towards socialistic policy:

Democrats and Republicans are both libertarian...kind of

Today was my first day in a political science class which is based around American Political Thought. One thing that is interesting to look at with the history of political thought is how the 'liberal' of the 18th century is really the 'libertarian' of today.

Sadly, some people in the class didn't really understand what the modern day libertarian is. One kid explained it as "I want the government out of my life!" and said Ron Paul was a good example of a present-day libertarian. He also pointed out how they are a fringe group that has not had much major impact, at least recently.

My professor pointed out something that is very interesting. The present political set-up (and where libertarian political thought is today) has its roots way back when the original 'liberals' split. The Republicans essentially reject the libertarian view of the government being out of society as they are in favor of such things as pro-life, against gay marriage, keeping marijuana illegal, etc. while the Democrats take the other route and think that the government should regulate the market heavily. Both have libertarian sides to their stances, and they vary from person to person (for example Ron Paul is pro-life, while some Democrats would oppose legalizing marijuana, etc.).

The two points I want to leave you with are:
1) Libertarian political thought has influence on both modern-day liberal and conservative ideology, and really is not quite as 'radical' as some might believe.
2) It is inaccurate to say that libertarian political thought has been attempted already, but has failed. The total package has never been implemented, only parts of it have been.

What I am most excited about is how libertarian thought has and will continue to gain influence in the Republican Party. They will be forced to appeal to this growing group. Even if full libertarian ideology will never be fully implemented, I think that the whole Ron Paul Revolution of 2008 (now the Campaign For Liberty) has created an explosion of libertarian activism.

What exactly is libertarian political ideology? I'll save that for another day.

Why can't we abolish the income tax?

The income tax was probably the worst idea (okay, not the worst, but close) when it comes to taxes. Who thought of this anyway? "Hey, I have a great idea: let's tax everyone's incomes." Or an even better idea, "No, no, no, let's take it further and the more someone makes, the more they get taxed!" Penalize people for producing. Great Idea.

Not only has the income tax stifled production (why would someone want to produce more when they can only keep .15 for each dollar they earn?) but it is simply inefficient. The tax code is so complex that only the very rich can afford to hire teams of accountants and lawyers to find loopholes so they can pay as little as legally possible. Not to mention the hours upon hours that people spend each year filing returns. How about we spend that time doing something a little more efficient? We all know that we can surely spend that money much more efficiently than government could ever dream of.

Especially in this time of economic downturn, you would think the government would think of a better way to stimulate economic activity than pull close to a trillion dollars out of the private market (that 'stimulus' money has to come from somewhere!). Come on, how many of you out there honestly think that the income tax is a good idea? Honestly! I would seriously doubt that more than 25% of the American population (when they actually stopped and thought about it) would rather have the income tax than NOT have it.

Alas, there is at least one voice of sanity when it comes to sound economic policy. Who else but Ron Paul?:

"If Congress really wanted to do something helpful, it would cut taxes. Ideally, we would repeal the income tax altogether and get the IRS off the economy’s back, which would be a huge boon. We should also cut spending. Cut every unconstitutional department and program, every wasteful governmental encroachment on the people’s liberty and money, starting with our massive overseas empire. The cost of our empire is bringing us to our knees, just as the Soviets’ empire did to them. Congress should also abolish the Federal Reserve and take back its responsibilities to ensure sound money, safe from the manipulations of powerful banking interests."

-Ron Paul, Texas Straight Talk

A Sign From God?

This may sound a little goofy (you probably will just think I’m a college student too hopped up on caffeine) but something happened to me that is not explainable. Over the past few weeks I have been reflecting on my choice of finance for my major, and actually recently decided I will stay an extra semester and double major in Finance/Econ.

When I first came to St. Thomas I was set on a Financial Management major and a Political Science minor (which then turned into a double major). After a while I realized I like economics and thought it ‘fit’ better with Finance, so I dropped Political Science altogether (after taking a total of two political science classes).

I have always been interested in politics, but this past year I have taken it into overdrive (borderline addiction). I started a blog, donated dollars to my first candidate, went to the Rally for the Republic, started listening to talk radio, read multiple web sites with political news, and now am part of a web log (amazingly, a group blog where the first candidate I ever donated to also posts!). I could probably list over 50 political books I want to read, and would love to be involved in politics the rest of my life.

So why am I not pursuing a political science degree? Well, I figured, I like business and finance is something that intrigues me. But really, when someone is so passionate about a subject and easily could spend a lifetime researching, commenting, and writing about such a topic, maybe I’m looking at the wrong profession?

Anyway, so I have four business classes this semester (two finance, one marketing, one accounting). Overload? Perhaps. So I was not too keen on the marketing class, and would rather put it off (I will need to take it eventually if I want a finance major). So I looked to see if there were any other classes during that time. Sure enough, there is a political science class that one of my all time favorite professors is teaching. I emailed him if I could get in, and sure enough, I could. I have never dropped a class during a regular semester, this would be a huge first.

So this is what happened: I went in to do the change (after hours of tossing the idea around in my head…I would hate to take a class if I wasn’t going to get the degree) but somehow the marketing class was already dropped? Had I gone in and dropped it myself??? When??? I’m sure I hadn’t. I can say with 100% honesty no matter how long I try to remember when I did this, I simply cannot! Well, I happily joined the political science class. Sign from God? Maybe. Hopefully.

The Huffington Post Complete Guide to Blogging

The Huffington Post Complete Guide to Blogging is a book that I would highly recommend to anyone who:

1) Wants to Start a Blog
2) Has Started a Blog But Rarely Posts
3) Wants to Make the Best Use of Their Blog

Though some of the information is basic, it allows the book to have a bigger target audience. You do not need to have any background about blogging to make use of this book. The Huffington Post is an extremely successful weblog that cranks out posts at all hours of the day. They get millions of hits per month and obviously the bloggers who contribute to their site have a lot of advice to offer.

I have been blogging for a little over a half year. I have found it to be a great way to get my opinions out and in writing. It has also allowed me to connect with people I otherwise never would have connected with. I love the information I find on some blogs, the stories from people's everyday lives, and relatives blogs (such as my aunts) where I can see what they are up to however far they are from where I am. I now am a contributor at a very cool group blog, United Liberty, where there are many contributors passionate about liberty. Needless to say, my experience with blogging has been pretty positive.

I would highly recommend blogging to anyone, really. Perhaps you will find it is not for you, but maybe you will really enjoy it and have thousands of readers. You never know until you try.