Wednesday, August 31, 2011

Obama's Lowlights (8/31/11)

Jobs – According to the Gallup Jobs Index, the states that are the best at producing jobs are conservative leaning (7 of the top 10) meanwhile, states that are the worst at producing jobs are liberal leaning (9 of 10).

Obamacare – The administration continues to hand out 3 year waivers to nullify certain provisions within the new healthcare law. The number of waivers is approaching 1,500.

Civil Discourse – NY Times guest columnist, Kurt Andersen, called Tea Partiers “a disease”. Maxine Waters said “Tea Partiers can go straight to hell”. This is from the Party that claims to promote civil discourse.

PETA – They will launch a pornographic web site that will not only have adult sexual content, but will also include graphic images of animal abuses and mistreatment.

Social Security – The disability program within social security is pushing the program towards insolvency. Applications for the disability program are up 50% over the past decade.

Romney – Reports indicate that 67 Wall Street donors, who supported Obama in 2008, are now backing Mitt Romney.

Biden – In a trip to China, Biden openly supported their one child system. Once again, the White House had to clarify Biden’s comments and urged the public that Obama strongly opposes the China policy.

Sheila Jackson-Lee – I did not fact check this, but would not be surprised if it is true. The Texas Congresswoman is unhappy that Hurricane names sound Caucasian and would also like for meteorologists to broadcast weather reports in a language that is understandable to street people. Jackson-Lee claims that this was the reason why many in New Orleans failed to leave the city before Hurricane Katrina hit the city.

Gallup – Obama broke his record low for his approval rating (38%). And with his disapproval numbers at 55%, this is also a new all-time high. Hence, we can conclude, Obama’s negative differential of 17% between his approval / disapproval numbers is also a record low for Obama. What is probably most troublesome for Obama is that Romney, Perry, Paul, and Bachmann all poll within the margin of error in head to head matchups with Obama.

Golf – President Bush gave up golf because he did not want to give that image to struggling Americans or to families that have children serving in Iraq or Afghanistan. I doubt President Obama will ever come to that same realization.

Frederica Wilson – The Democratic Congresswoman believes the reason for high unemployment in black communities is due to racism. It seems we cannot go a week without some liberal using the race card or insinuating someone is a terrorist or Nazi. I guess this is the civil discourse the Left claims to follow.

CBO – They are estimating that the debt for 2011 will hit 1.5 trillion dollars. Hence, the U.S. debt is increasing at a rate of 3 million dollars every minute (an all-time high).

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Tuesday, August 30, 2011

Economic Model Summary


What was learned from the economic models posted over the past several months?

• If the federal government raises taxes and receives more tax revenue it spends more money because the debt, budget and government spending continue to increase.

• Maximizing consumer spending does just as much to reduce the poverty level as increased government spending and debt.

• Government Social Benefits needs to be minimized. This economic parameter had the most significant negative impact on other economic parameters.

• Government budget deficits and debt need to be minimized. This economic parameter had the second most significant negative impact on other economic parameters.

• Population increases had little impact on economic parameters.

• State budget deficits and state social benefit payments had little overall impact on national economic parameters.

• Consumer spending needs to be maximized. This parameter had the most significant positive impact on other economic parameters.

• Personal income needs to be maximized. This parameter has the second most significant positive impact on other economic parameters.

• The trade deficit has a big impact on many economic indicators (some good and some bad).

• Economic parameters such as GDP, tax receipts, unemployment, inflation, and government spending had less of an impact on other economic parameters than one may suspect.

• Government spending is a leading cause for inflation and driving energy prices and healthcare costs higher.


These are just a few of the obvious observations. I will also post models in the future on other complex issues / problems including healthcare and climate change.


My Book: Is America Dying? (Amazon.com, Barnes and Noble)


Monday, August 29, 2011

Summary: The Relationship Betweeen Taxes, Income, Debt, Spending, Social Benefits, and the Trade Deficit

This is summary of linear regression model results (posted over the past several weeks) on the relationship between taxes, income, debt, spending, social benefits, and the trade deficit. The following results are dependent on changing the fifth quintile’s effective tax rate from 13 to 17.5%, its income from 46,800 to 50,800 dollars, and its consumer spending rate from 36 to 40%. This models the result if the highest income bracket tax rate is increased from 35% to 39.5%.

• Federal government Tax Revenue will vary from 1.09 trillion to 1.26 trillion dollars. The model accuracy is perfect (R² = 1).
• Consumer Spending will vary from 12.2 trillion to 12.9 trillion dollars. The model accuracy is perfect (R² = 1).
• The federal government Effective Tax Rate will vary from 8.3% to 11.2%. The model accuracy is perfect (R² = 1).
• Federal government expenditures on Social Benefit spending will vary from 1.74 trillion to 2.13 trillion dollars. The model accuracy is near perfect (R² = 0.97).
• The national Debt will vary from 9.6 trillion to 11.5 trillion dollars. The model accuracy is perfect (R² = 1).
• The national Trade Deficit will vary from a loss of 441 billion to 813 billion dollars annually. The model accuracy is perfect (R² = 1). The trend results are similar if the trade deficit is adjusted for oil imports.

Similar results are achieved from another model that varies the effective tax rate from 8% to 11%, the first quintiles adjusted social benefits income from 17,800 dollars to 21,800 dollars, and the fifth quintiles adjusted social benefits income from 46,800 dollars to 50,800 dollars.

• Federal government expenditures on Social Benefit spending will vary from 1.8 trillion to 2.03 trillion dollars. The model accuracy is near perfect (R² = .97).
• The national Debt will vary from 9.15 trillion to 10.95 trillion dollars. The model accuracy is near perfect (R² = .99).
• The national Trade Deficit will vary from a loss of 725 billion to 881 billion dollars. The model accuracy is near perfect (R² = .98). The trend results are similar if the trade deficit is adjusted for oil imports.

Since consumer spending, income, and the tax rate are directly related – it makes sense to use all three when computing the tax rate. An example of a fair tax rate formula is: Tax Rate (TR) = Income (I) / (1 / (1 – Consumer Spending (CS))). After all, if the tax rate goes up and consumer spending goes down, it will adversely affect the economy.

Summary: If the federal government raises the income tax on the highest earners (fifth quintile) from 35% to 39.6%: tax revenues will go up nearly 170 billion dollars annually; consumer spending will go down 700 billion dollars; the effective federal income tax rate will go up from 8.3 to 11.2%; the federal government spending on social benefits will increase by 300 billion dollars; and the national debt will sore 1.9 trillion dollars. These results track if a separate model is created taking into account adjusted national incomes due to social benefits (entitlement spending). The bottom line – increasing taxes on the highest earners will only create higher social benefit spending, a much greater national debt, and much lower consumer spending that could cost the economy up to 2 million jobs. In other words, raising taxes is the main ingredient in a formula to create a recession. On the hand, there is an argument that increased taxes could both increase or decrease the trade deficit.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Saturday, August 27, 2011

Obama's Lowlights (8/27/11)

Obamaisms – Here are few great quotes from “the chosen one” when on his bus campaign tour: “The economy has gotten better than when I first took office”. “If everyone took the attitude of shared sacrifice than we could solve our debt and deficit problems next week”. Obama also said to a farmer “Your fears are unfounded about government regulation”.

Fast and Furious – Several more reports have surfaced confirming that the weapons used in the program not only killed people in Mexico, but in the United States.

Moody’s - In the wake of American's credit rating downgrade, Moody's now says its near-term outlook for the U.S. economy has fallen significantly. The Wall Street Journal reports: "The firm attributes most of the expected decline to a loss of business, investor and consumer confidence, noting the economy’s improving fundamentals such as the strengthening of business’s balance sheets and consumers’ strides in cutting household debt."

Obama Bus Tour – Obama continually preached on his 1.1 million dollar taxpayer funded bus tour to buy American products. Unfortunately, the Obama’s bus was made in Canada.

Economy – The cost of living index rose 0.5 percent in July and the consumer price index also rose 0.2 percent according to the Labor Department. Also, the housing market continued to slide in July.

New York – Good News: A New York judge dismissed a class action suit that alleged consumers have reached a level of stupidity they cannot understand how to buy tickets for a New York Yankees game online.

S&P – Shortly after S&P downgraded U.S. treasury bonds, the DOJ began an investigation into the company. Rumors surfaced that the investigation is about their role in the financial collapse because they had AAA ratings on mortgage backed securities that failed.

Amnesty – The White House, without congressional approval, has unveiled its new immigration policy – Only illegal immigrants with criminal records will be deported, the rest will be given amnesty.

Aliens – A team of researchers have come up with a scenario that aliens could attack earth to stop global warming because they see it as a threat to their ecosystem. I do not know about you, but I am glad taxpayer money is being used on commonsense and logical approaches to practical problems and issues.

Homosexuals - MSNBC reports that “three bisexual men have filed a federal lawsuit against a national gay-sports organization, claiming they were unfairly deemed not gay enough to play for a gay softball team during the Gay Softball World Series."

Diversity - President Obama issued an executive order last week creating a new bureaucracy that will create new rules “promote diversity and inclusion in the federal workforce,” whatever that means.

Taxes - Warren Buffet thinks the $6.9 million he paid in 2010 wasn't enough and wants to be taxed more. National Review points out he's not alone. George Soros, Stephen King, and Matt Damon want to know why the "super rich" aren't paying 50 percent in taxes? Remember, there is nothing stopping these people from paying more in taxes – they do not have to claim all their deductions and capital loses, but they conveniently fail to do this.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Friday, August 26, 2011

Advanced Economic Data

The economic data in my last post included the effects of inflation, unemployment, the budget, debt, and the gross domestic product on our economy. The below data adds the effects of consumer spending on the results from 1930 to 2010 from yesterday’s data. The last two columns add the effects of housing and auto sales as well as the trade surplus/deficit numbers on the economy from 1960 to 2010. Each of the annual results is ranked in order from best to worst.

Year Administration Administration Rank Year Rank Year Result Year Result Year Rank
Lower is Better Higher is Better Higher is Better
Included Trade Deficit/Housing/Auto
1930 Hoover 67.5 71 0.139345797
1931 64 0.210419081
1932 FDR 62.53846154 74 0.105261784
1933 77 0.065927047
1934 78 0.055874251
1935 75 0.089663178
1936 72 0.12937271
1937 73 0.112178013
1938 60 0.284495172
1939 59 0.292502039
1940 53 0.338303809
1941 61 0.243776477
1942 69 0.173640032
1943 47 0.404796287
1944 15 0.838565937
1945 Truman 72.57142857 65 0.201738546
1946 81 0.013678973
1947 80 0.01763889
1948 79 0.039130755
1949 67 0.190822755
1950 66 0.197421359
1951 70 0.153934325
1952 12 0.877539585
1953 Eisenhower 16.125 1 0.995273461
1954 25 0.682557344
1955 2 0.987840742
1956 11 0.886158024
1957 24 0.68423737
1958 40 0.454862223
1959 10 0.904730878
1960 16 0.806800956 0.7849878 10
1961 JFK 11 17 0.779490145 0.743358727 13
1962 7 0.92143518 0.932567101 6
1963 9 0.905784462 0.922851096 7
1964 LBJ 5.2 4 0.970212036 0.984982067 2
1965 3 0.978814616 0.990796696 1
1966 6 0.966284763 0.977612794 4
1967 5 0.967106177 0.977930996 3
1968 8 0.920402421 0.933475042 5
1969 Nixon 17.25 14 0.845067242 0.835257479 9
1970 22 0.704881829 0.650154781 16
1971 20 0.732382156 0.689598547 14
1972 13 0.857633796 0.863472246 8
1973 Ford 42.25 23 0.686493028 0.62434431 19
1974 55 0.33211444 0.179404386 44
1975 57 0.321579972 0.173544939 45
1976 34 0.509598854 0.36580158 28
1977 Carter 47.75 38 0.48539981 0.35316351 30
1978 36 0.490971433 0.348099757 32
1979 54 0.332565903 0.180633892 43
1980 63 0.233279209 0.097806068 49
1981 Regan 35.25 56 0.321743838 0.153677774 47
1982 49 0.381772329 0.208356036 41
1983 35 0.503995857 0.348178555 31
1984 32 0.54773218 0.406056681 24
1985 28 0.597794466 0.492928298 20
1986 21 0.710379159 0.639846296 17
1987 31 0.566435225 0.44269449 23
1988 30 0.580800208 0.462933805 22
1989 Bush 45.25 33 0.521165415 0.383677149 25
1990 46 0.412307398 0.270617242 38
1991 50 0.355030984 0.156074549 46
1992 52 0.345444204 0.182286727 42
1993 Clinton 34.125 51 0.347354183 0.211766125 40
1994 45 0.427773702 0.305690265 35
1995 43 0.437206907 0.304397475 36
1996 42 0.441622034 0.347118254 33
1997 29 0.590670423 0.475517612 21
1998 18 0.779123193 0.7652657 11
1999 19 0.739476814 0.756822966 12
2000 26 0.633036039 0.626496742 18
2001 Bush 44.5 27 0.623196359 0.679603264 15
2002 58 0.309619948 0.219628872 39
2003 39 0.461385592 0.317257402 34
2004 44 0.436895133 0.372577876 26
2005 48 0.392233115 0.279763426 37
2006 41 0.448807255 0.354638429 29
2007 37 0.485572252 0.370304654 27
2008 62 0.243657754 0.101303216 48
2009 Obama 72 68 0.185875697 0.04675897 50
2010 76 0.085299188 0.017963418 51

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Tuesday, August 23, 2011

Obama's Lowlights (8/23/11)

Exxon – The average tax per gallon of gas is 50 cents nationwide. Exxon’s average profit per gallon of gas is less than 5 cents. So, who exactly is evil: big oil or big government?

Post Office – They are drawing strong criticism from labor unions because the US Postal Service has proposed cutting 120,000 jobs, in addition to pulling out of the government run health care plan. The Washington Post reports, "During the past four years, the service lost $20 billion, including $8.5 billion in fiscal 2010."

London Riots – The identity of several looters has astonished many since they are not all welfare recipients, but well to do people holding great jobs – a ballerina, an organic chef, teachers, and even a member of the Olympic committee.

Italy – Their government has made bold fiscal changes including entitlement reform in an effort to cut 65 billion in spending.

San Francisco –The city is coming under attack for shutting down cell service to prevent a protest from organizing over a fallen transit police officer.

Polls – Obama’s approval ratings continue to hit lows just 4 months after a surge for killing Osama bin Laden. Also, 93% of all Americans feel that grocery prices are higher this year.

Iraq – As the United States scales down its forces in Iraq, violence continues to escalate.

Pakistan – They allowed China to look at the downed U.S. military helicopter from the bin Laden raid.

Virginia – Gun crimes in establishments that serve alcohol declined 5.2% in the first year since allowing its citizens to carry concealed weapons.

Germany – Their economy has done well through the recession, but their second quarter GDP numbers were anemic.

Fast and Furious – The ATF agents that botched the gun operation have been promoted by the agency.

Joe Wilson – The South Carolina representative was vindicated (He yelled “You Lie” when Obama said ObamaCare did not provide health insurance to illegal immigrants during a speech) when reports surfaced that the Health and Human Service Department have awarded millions in healthcare benefits to migrant workers citing new ObamaCare provisions.

MSNBC – Chris Matthews first mocked Rick Perry’s faith and then asked a guest to describe how ugly he is. Meanwhile, Ed Schultz has painted Perry as a racist.

Wind Energy – Finally, a report about how wind turbines kill birds (I have been telling the Left about this for years). It is reported that one California wind farm killed 4700 birds annually including endangered species such as 1300 raptors, 70 gold eagles and various owl species. Where is the environmental outrage over this? To illustrate the hypocrisy, in 2009, Exxon pleaded guilty to killing 85 migratory birds in 5 states that contacted uncovered crude oil and were fined 600 thousand dollars.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Monday, August 22, 2011

Economic Data Results

Below is the data that described and summarized in the last post.


Year Administration Administration Rank Year Rank Year Result
Lower is Better Higher is Better
1930 Hoover 67 70 0.130831887
1931 64 0.221734166
1932 FDR 61.84615385 71 0.122935228
1933 77 0.076671222
1934 78 0.049809404
1935 76 0.087318947
1936 72 0.121703976
1937 75 0.10023436
1938 56 0.311094304
1939 57 0.303852641
1940 54 0.334176301
1941 65 0.201564244
1942 69 0.150541944
1943 47 0.425730648
1944 7 0.916082866
1945 Truman 72.85714286 62 0.243494218
1946 81 0.009172218
1947 80 0.0120532
1948 79 0.028445666
1949 67 0.194375385
1950 68 0.178107058
1951 73 0.118795401
1952 13 0.858361589
1953 Eisenhower 17.75 1 0.994400033
1954 25 0.647240426
1955 2 0.98599563
1956 12 0.865117379
1957 26 0.640643105
1958 48 0.409641689
1959 10 0.889323577
1960 18 0.772019672
1961 JFK 13.33333333 20 0.73786751
1962 9 0.899980138
1963 11 0.880492743
1964 LBJ 5.2 4 0.959708924
1965 3 0.971483705
1966 6 0.957280896
1967 5 0.958452384
1968 8 0.902734896
1969 Nixon 19.25 16 0.815206674
1970 24 0.662566989
1971 23 0.695704785
1972 14 0.838745449
1973 Ford 47 27 0.638245657
1974 58 0.291196251
1975 61 0.269105837
1976 42 0.462022164
1977 Carter 53.5 45 0.450375938
1978 44 0.451813686
1979 59 0.288065432
1980 66 0.194419637
1981 Regan 37.25 60 0.274939679
1982 51 0.344763124
1983 39 0.489134255
1984 36 0.544792581
1985 30 0.609247419
1986 19 0.741096527
1987 32 0.593746561
1988 31 0.598178077
1989 Bush 47.75 37 0.524901208
1990 49 0.408674223
1991 52 0.341571053
1992 53 0.336825808
1993 Clinton 32.625 50 0.349906492
1994 46 0.445423691
1995 43 0.459736113
1996 41 0.466937537
1997 28 0.626830293
1998 15 0.83470193
1999 17 0.814179757
2000 21 0.728106057
2001 Bush 35.75 22 0.719220129
2002 40 0.474852286
2003 34 0.567047555
2004 35 0.554101245
2005 38 0.510451053
2006 33 0.582860235
2007 29 0.6187823
2008 55 0.314333976
2009 Obama 68.5 63 0.226752781
2010 74 0.103257823

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Making Sense of Economic Data

For years pundits have argued which years have been the best or worst in our nation’s economic history. Pundits have argued which president led our economy through the best or worst times. Today, we continually hear the Obama administration claim we are going through the worst recession since the Great Depression. Is this true?

To answer these questions I have tried to compare our economic strengths and weaknesses annually from 1930 to the present. I have combined yearly unemployment, inflation, federal budget levels, federal debt levels, and our gross domestic product (GDP) into one metric or figure of merit. These are arguably the most critical yearly statistics to measure an economies wellness or sickness. The data is fitted into a normal distribution curve and ranked in order from best to worst economic years.

The presidential administrations from 1930 to the present ranked as follows (ratings are in brackets []. Each of 81 years is ranked 1 through 81. The ranking indicates the average yearly ranking for each administration.): first, Lyndon Johnson (LBJ) [5]; second, John Kennedy (JFK) [13]; third, Dwight Eisenhower [17]; fourth, Richard Nixon [19]; fifth, Bill Clinton [33]; sixth, George W. Bush [37]; seventh, Ronald Reagan [38]; eighth, Gerald Ford [47]; ninth, George H.W. Bush [48]; tenth, Jimmy Carter [54]; eleventh, Franklin Roosevelt (FDR) [62]; twelfth, Herbert Hoover [67]; thirteenth, Barack Obama [68]; fourteenth, Harry Truman [72]. This data can be misleading because it does not account for trends. For instance, Eisenhower could be credited with stabilizing the economy that benefited JFK and LBJ. Reagan was responsible for getting the Carter mess under control. And yes, although George W. Bush is ranked 6th, the economic status under his guidance got worse each year. Thus, he could have benefited from Clinton’s leadership and could be responsible for hurting Obama’s numbers.

The top 10 years according to this statistical average are as follows: 1. 1953 (.994); 2. 1955 (.986); 3. 1965 (.971); 4. 1964 (.960); 5. 1967 (.958); 6. 1966 (.957); 7. 1944 (.916); 8. 1968 (.903); 9. 1962 (.900); and 10. 1959 (.889). The ratings in parenthesis are a percentage as to where each year lies in the normal distribution curve. A rating of 0.50 is average, and any number higher than that is above average and any number lower than that is below average. The 10 worst years are as follows: 1. 1946 (.010); 2. 1945 (0.12); 3. 1948 (.028); 1934 (.050); 5. 1933 (.077); 6. 1935 (.087); 7. 1937 (.100); 8. 2010 (.103); 9. 1951 (.119); 10. 1936 (.122). In essence, the figure of merit for 1953 is at the 99.4 percentile while 1946 is at the 1 percentile in terms of economic stability.

Here is a list of each administrations best and worst years. Barack Obama: 2009 (.227), 2010 (.103); George W. Bush: 2001 (.719), 2008 (.314); Bill Clinton: 1998 (.837), 1993 (.350); George H.W. Bush: 1989 (.525), 1992 (.334); Ronald Reagan: 1986 (.741), 1981 (.274); Jimmy Carter: 1978 (.452), 1980 (.194); Gerald Ford: 1973 (.638), 1975 (.269); Richard Nixon: 1972 (.839), 1970 (.663); LBJ: 1965 (.971), 1968 (.903); JFK: 1962 (.900), 1961 (.738); Dwight Eisenhower: 1953 (.994), 1958 (.410); Harry Truman: 1952 (.858); 1946 (.010); FDR: 1944 (.916), 1934 (.050); Herbert Hoover: 1931 (.222), 1930 (.130).

I will post the entire results of this analysis in my next blog post.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Friday, August 19, 2011

Obama's Lowlights (8/19/11)

MSNBC – Their new opinion talk show host is no other than race antagonist Al Sharpton. I tried watching the show, but Sharpton can hardly read his lines – pitiful.

Debt Committee – The National Taxpayers Union and the Club for Growth have given grades (0-100%) to all politicians based on how their voting patterns affect economic growth. All of the Democratic Senators on the new Debt Committee failed miserably: Murray scored 6% and 6% respectively; Kerry 6% and 3%; and Baucus 9% and 13%.

Obama Campaign 2012 – With no accomplishments (unless you consider unpopular legislation such as ObamaCare and the Recovery Act a success), many news outlets are predicting that the Obama campaign will be a highly negative one. In other words, they will attack their opponent instead of pointing out administration accomplishments and successes since they have none.

Hillary Clinton – I doubt it will happen, but there are so many liberals disappointed with Obama they are trying to push a Clinton primary challenge.

London – Riots have been escalating over the past month due primarily to government budget cuts. This once again illustrates what happens in an entitlement society.

Afghanistan Victims – Several families of the 20 Navy Seals killed in Afghanistan pleaded with the Pentagon and the White House not to release any photos of the remains at Dover Air Force Base. The photos were released.
Bush Tax Cuts – This was reported by Michael Medved. In an August 8th editorial entitled “The Truth About Taxes” the New York Times finally (if unwittingly) acknowledged Bush reforms weren’t just “tax cuts for the rich.” America’s “Journal of Record” wrote: “Letting all of the cuts expire at the end of 2012 would save $3.8 trillion over the next decade. Letting the tax cuts expire for those making more than $250,000 would save $700 billion.” In other words, 82 percent—82 percent!—of Bush tax relief goes to households earning below $250,000, benefiting the middle class, and poor families who got dropped from tax rolls altogether.

Student Loans – This may be the next financial bubble to burst. With only 15% of college graduates receiving jobs upon graduation the default rate is expected to grow substantially. In fact, student loan debt is now higher than credit card debt in the U.S.

Wisconsin – Democrats, who failed to win the upper house by recalling 6 Republicans, are now trying to find a way to recall newly elected governor Scott Walker.

ObamaCare – The 11th Circuit of Appeals Court sided with 26 states saying the mandate in ObamaCare is unconstitutional.

Consumer Confidence – August numbers were at their lowest point in over 30 years – yes, significantly lower than any point during what the Left referred to as “the lost decade” under President Bush.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Thursday, August 18, 2011

African-Americans and Liberalism

I have been writing for years that African-American’s support the wrong political party. African-Americans vote for Democratic candidates over 90% of the time during the past 50 years. What have Democrats accomplished for African-Americans over the past half century? First of all, as I have pointed out time and time again in my writings, it took Republicans to overcome Democrat filibuster attempts to pass the civil rights act. Secondly, as I have pointed out, we need to look no further than current day inner cities to see failed liberal policies – Newark New Jersey and Detroit Michigan are great examples of African-Americans segregated to the slums of inner cities loaded with crime, substance addiction, broken educational systems, and poverty. I have also pointed out that African-Americans have poor leadership – Al Sharpton and Jesse Jackson are given a podium to brainwash and indoctrinate African-Americans into believing that Republicans are racists who do not care about the plight of their race. I have also pointed out numerous African-Americans who would make good leaders to head their race, but I forgot to mention one – Reverend C.L. Bryant.

Bryant was a one time member of the National Association for the Advancement of Colored People (NAACP). He first began to break from the NAACP because they did not like his prolife stance. And what’s more, over the years he made many of the same observations that I have pointed out in my writings. Bryant has made several other more harsh observations about the plight of the African-American race, over the past 50 years, that are worth pointing out.

Bryant believes that African-American life over the past 50 years has not been much different than the lives of slaves on plantations. He points out that masters on plantations owned the land and provided slaves with housing, clothing, and food. Today, the lives of many African-Americans are not much different since they are slaves to the government, Democrats who want their vote, and poor leaders that provide them low income housing, food stamps, and other welfare subsidies to buy clothing.

Bryant also pointed out the exploitation of African-Americans in Louisiana during Hurricane Katrina. Bryant astutely observes that local and state Democratic leaders – Governor Kathleen Blanco, Senator Mary Landrieu, and Mayor Ray Nagin – had no problem getting buses out of lots to get communities out to the polls to elect them, but those buses remained idle as the deadly Hurricane approached. However, Blanco, Landrieu, Nagin, and media pundits were able to spin the disaster and blame President George Bush – who incidentally declared New Orleans a disaster area before the storm hit land.

Yes, Reverend C.L. Bryant has figured out that Democrats want to keep African-Americans oppressed and dependent on government welfare. He understands that this is how Democrats ensure that African-Americans will continue to vote for them year in and year out. Hopefully, C.L. will help change this perception by opening the eyes of African-Americans that are forced to exist within the confines of inner cities decimated with crime, disease, addictions, and poverty.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

What Economic Indicators Have the Biggest Effect on the Economy (Part II)

When performing a linear regression model and solving for Debt, Trade Deficit, GDP, Inflation, Tax Revenue, Unemployment, Budget, and Consumer Spending we get the following equations:

Parameter Intercept Unemployment Inflation GDP Debt Budget Home Price Housing CPI Trade Deficit Tax Revenue Consumer Spending Auto Sales
Debt = -2376 -145.5 32.43 -1.792 0 3.052 -0.00231 0.9519 26.18 -0.004196 0.0003138 0.003041 -6.192
Trade Deficit = -1998 -32294 3619 -487 -114 1894 0.8807 254.1 -3220 0 0.04326 0.8848 -2816
GDP = 938.6 -66.82 -28.08 0 -0.1021 -0.1053 0.002069 0.2452 -7.214 -0.001058 4.89E-05 0.00169 -4.819
Inflation = 22.29 -0.5324 0 -0.00574 0.000391 -0.00753 3.15E-05 -0.01656 -0.1417 1.61E-06 -1.33E-06 1.02E-05 -0.03918
Tax Revenue = 1657362 -70587 -14010 105.7 40.01 -818.6 -3.349 -92.53 -9519 0.203 0 0.4324 -2671
Unemployment = 15.83 0 0.2722 -0.00693 -0.0009 -0.00198 -6.25E-06 0.001771 -0.1215 -7.34E-06 -3.42E-06 1.42E-05 -5.22E-02
Budget = 1382 -15.92 -31.05 -0.08868 0.1518 0 0.0007186 -0.1167 -11 0.0003468 0.0003193 0.000348 -2.086
Consumer Spending = -691475 44461 16049 544.7 57.85 133.1 -0.7387 -143.9 5940 0.6197 0.06453 0 3156

For example, for the national Debt the equation is equal to -2376 – 145.5 x Unemployment + 32.43 x Inflation – 1.792 x GDP + 3.052 x Budget – 0.00231 x Home Price + .9519 x Housing Startups + 26.18 x CPI – 0.004196 x Trade Deficit + 0.0003138 x Tax Revenue + 0.003041 x Consumer Spending – 6.192 x Auto Sales.

We can learn a lot about our economy by evaluating each equation. For instance, the debt equation shows that the debt will decrease as unemployment increases; the debt will go up as inflation increases; the debt will decrease as GDP goes up; the debt will increase as the national budget increases; the debt will go down as home prices increase; the debt will go up as housing starts increase; the debt will go up as Consumer Price Index (CPI) goes up; the debt will go down as the trade deficit increases, the debt will go up with tax revenue increases; the debt will go up with consumer spending; and the debt will go down as auto sales increase.

It certainly is not surprising that our national debt is lowered if GDP or other economic indicators such as auto sales or home prices go up. And it is certainly not surprising that our national debt goes up if the federal budget increases, or if there is higher inflation, or if CPI prices increase. There are however, some surprising results – in particular, even as tax revenues and consumer spending increase the debt continues to go up – that is because as the government receives more in tax revenues, they spend more money. This result is apparent by reviewing the results of the other 7 equations. But there are some mind boggling results. For instance, if unemployment and our trade deficit increase it would yield a lower national debt. This actually states that the federal government tends to be more frugal during recessions – this is certainly not the case with our current president.

But there are some other more logical explanations for the strange results in the national debt formula. First, the intercept value starts negative (so there has already been a negative compensation in the formula), so there has to be more upward movement in the formula. Secondly, unemployment and the trade deficit are in the bottom five parameters that affect our economy. The impact of each economic indicator can be weighted in each of the above 8 equations. The 4 most significant parameters that affect the economy are GDP, Consumer Spending, Debt, and the national Budget. The parameters that have the smallest impact on the economy are inflation, tax revenues, and the trade deficit.

Thus, a thriving economy is one where GDP and consumer spending are maximized whereas tax revenues are minimized while at the same time balancing the budget. In other words, we need a society that emphasizes capitalism over government interference. The bottom line is that higher tax revenues do little to fix the budget deficit because the federal government irresponsibly spends any additional revenues it receives.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Monday, August 15, 2011

Obama's Lowlights (8/15/11)

Fast and Furious – More disturbing information is coming forth that the DEA also allowed Mexican drug cartels to bring drugs across the border in exchange for information. Thus, Fast and Furious was not just about guns going to Mexico, but drugs coming to the United States.

Nancy Pelosi – The House has moved her “Green the Capitol” initiative into a larger energy bill that has been shelved.

Obama Movie – A movie about Obama’s decision to kill Osama bin Laden is schedule to be released a month before the 2012 election.

Italy and Spain – The European Central Bank has bought a large sum of both Italian and Spanish toxic debt. Both of these nations are in danger of defaulting on their debt.

Gold – As economic news continues to be bleak gold continues to soar to new record highs (over 1800 dollars per ounce).

Credit Downgrade – Obama on the credit downgrade “We need to work together and enact my policies”. Seriously? We enacted his debt spending policies for two years and look where that got us.

Department of Innovation – I did not know this department existed let alone it has a new logo. If you have not seen the logo it is hilarious, it looks like ancient technology - grinding flywheels – so is the message “gridlock”?

NRLB / Boeing – House Oversight committee head, Darrell Issa, has subpoenaed government documents on the NRLB / Boeing case (Remember, the NRLB blocked Boeing from building a plant in a right to work state – South Carolina).

Michelle Obama – One of her main focuses as first lady is to advocate for military families, but she was a no show to honor the 31 fallen soldiers in Afghanistan this past week. Instead, she visited her brother in Oregon.

Al Gore – While addressing climate change in Aspen Colorado, he gave a four letter laced rant dissing naysayers. I never understood the strategy of disrespecting a group of people and then expecting them to conform to the ideology.

FED – To stop the stock sell off the chairman of the FED, Ben Bernanke, said he would keep interest rates at all-time lows for the next 2 years.

Debt Committee – Democrats Chris Van Hollen of Maryland, Jim Clyburn of South Carolina, Xavier Becerra of California, Patty Murray of Washington, Max Baucus of Montana, and John Kerry of Massachusetts will sit on the committee that was the result of the recent debt legislation. Republicans tabbed Rep. Jeb Hensarling of Texas, Rep. David Camp of Michigan, Rep. Fred Upton of Michigan (Paul Ryan asked not to be on the committee), Senator John Kyl, Senator Rob Portman, and Senator Pat Toomey.

Newsweek – They took the worst possible picture of Michelle Bachmann and placed it on the cover of their last issue. Even Jon Stewart criticized Newsweek’s bias over the picture.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

What Indicators Have the Biggest Impact on the Economy (Part I)?

I built an economic model using the following leading indicators from 1982 to 2010 (some parameters data only goes back to 1982): Unemployment, Inflation, Debt, Trade Deficit, Consumer Price Index, the Gross Domestic Product (GDP), Consumer Spending, Auto Sales, Tax Revenue, Housing Prices, and Housing Start Ups. The data is readily available from the Bureau of Economic Analysis (BEA). The model is below (the parameters are in percent or thousands or millions of dollars).

Year Unemployment Inflation GDP Debt Budget Home Price Housing Starts CPI Trade Deficit Tax Revenue Consumer Spending Auto Sales
1982 9.7 6.16 3253 1142 746 83900 1,062.2 42.29 24156 617766 2075500 79.6
1983 9.6 3.22 3534 1377 808 89800 1,703.0 43.29 57767 600562 2288600 100.8
1984 7.5 4.3 3931 1572 852 97600 1,749.5 45.25 109072 666438 2501100 124.4
1985 7.2 3.55 4218 1823 946 100800 1,741.8 41.45 121880 734037 2717600 146.6
1986 7 1.91 4460 2125 990 111900 1,805.4 45.62 138563 769155 2896700 164
1987 6.2 3.66 4736 2350 1004 127200 1,620.5 45.61 151684 854288 3097000 164.2
1988 5.5 4.08 5100 2602 1064 138300 1,488.1 45.52 114566 909238 3350100 175.9
1989 5.3 4.83 5482 2857 1144 148800 1,376.1 46.93 93141 991105 3594500 180.8
1990 5.6 5.39 5801 3233 1253 149800 1,192.7 48.21 80864 1031922 3835500 176.9
1991 6.8 4.25 5992 3665 1324 147200 1,013.9 49.6 31135 1054996 3980100 157.9
1992 7.5 3.03 6342 4064 1381 144100 1,199.7 51.17 39212 1091223 4236900 176.1
1993 6.9 2.96 6667 4411 1409 147700 1,287.6 53.46 70311 1154341 4483600 193.9
1994 6.1 2.61 7085 4692 1462 154500 1,457.0 53.99 98493 1258579 4750800 216.1
1995 5.6 2.81 7414 4974 1516 158700 1,354.1 54.66 96384 1351801 4987300 220.3
1996 5.4 2.93 7839 5225 1561 166400 1,476.8 55.29 104065 1453055 5273600 235.8
1997 4.9 2.34 8332 5413 1601 176200 1,474.0 55.45 108273 1579240 5570600 254
1998 4.5 1.55 8794 5526 1653 181900 1,616.9 51.56 166140 1721733 5918500 280.7
1999 4.2 2.19 9354 5656 1702 195600 1,640.9 51.23 264239 1822459 6342800 309.7
2000 4 3.38 9951 5674 1789 207000 1,568.7 52.47 378780 2025198 6830400 321.4
2001 4.7 2.83 10286 5807 1863 213200 1,602.7 55 364393 1991142 7148800 342
2002 5.8 1.59 10642 6228 2011 228700 1,704.9 54.45 420524 1853149 7439200 359.7
2003 6 2.27 11142 6783 2160 246300 1,847.7 56.18 494183 1782321 7804000 358.2
2004 5.5 2.68 11868 7379 2293 274500 1,955.8 57.71 609345 1880126 8285100 359.5
2005 5.1 3.39 12638 7933 2472 297000 2,068.3 61.05 714176 2153625 8819000 361.6
2006 4.6 3.24 13398 8507 2655 305900 1,800.9 66.63 759240 2406876 9322700 346.6
2007 4.6 2.85 14077 9008 2729 313600 1,355.0 69.72 702099 2568001 9806300 349.9
2008 5.8 3.85 14441 10023 2982 292600 905.5 75.36 698802 2523991 10104500 291
2009 9.3 -0.34 14256 11910 3518 270900 554.0 75.41 374908 2104989 10001300 269.4
2010 9.6 1 14500 13300 3721 272400 586.9 75.89 497824 2162724 10500000 303

In part 2 of this blog I will evaluate the impact of the parameters in the above model by finding a linear regression solution.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Saturday, August 13, 2011

Unemployment Model

Below are the results of running a linear regression model on various economic data (obtained from the Bureau of Economic Analysis [BEA] government site) from 1947 to the present solving for the unemployment economic parameter:

n 64

R2 0.79
Adjusted R2 0.74
SE 0.82

Term Coefficient 95% CI SE t statistic DF p
Intercept 5.545 1.916 to 9.175 1.8070 3.07 50 0.0035
Population 0.002931 -0.017709 to 0.023570 0.0102759 0.29 50 0.7767
Inflation -0.1406 -0.2205 to -0.0606 0.03980 -3.53 50 0.0009
GDP -0.00264 -0.00742 to 0.00214 0.002379 -1.11 50 0.2725
Debt -0.004598 -0.006006 to -0.003191 0.0007007 -6.56 50 <0.0001
Tax Receipts -0.001045 -0.009708 to 0.007618 0.0043131 -0.24 50 0.8095
Gov Spending 0.00789 -0.00145 to 0.01723 0.004649 1.70 50 0.0959
Budget -0.002198 -0.013211 to 0.008816 0.0054834 -0.40 50 0.6903
Trade Deficit 0.007352 0.000805 to 0.013899 0.0032594 2.26 50 0.0285
Consumer Spending 0.003819 -0.007226 to 0.014864 0.0054991 0.69 50 0.4906
State Deficit 0.01752 -0.00862 to 0.04366 0.013014 1.35 50 0.1843
State Social Payment -0.01106 -0.07132 to 0.04920 0.030001 -0.37 50 0.7139
Gov Social Benefits 0.03103 0.01167 to 0.05038 0.009637 3.22 50 0.0023
Personal Income -0.002082 -0.009859 to 0.005695 0.0038719 -0.54 50 0.5932


The economic parameters used to model unemployment over the past 64 (n) years are: the U.S. population, the inflation rate, personal income, the U.S. Gross Domestic Product (GDP), federal government debt, federal government tax receipts, federal government spending, the federal government budget levels, the federal trade deficit, consumer spending, state government budget levels, state government spending on social benefits, and federal government social benefit payments. The intercept value in the above table is not a parameter – it is the value of unemployment (in percent) if all other parameters equal zero. These economic parameters are denoted in the above table.

The R² statistic illustrates how closely the linear regression model resembles a straight line (the ideal condition). If R² equals one then the model is 100% linear and the parameters correlate 100%. On the other hand, if R² is equal to zero then there is no correlation and the data in the linear regression model is completely random. T statistics reveal which of the economic parameters has the best correlation to the parameter being tested (Unemployment in this case). The higher the absolute value of the t statistic, the better the correlation the corresponding economic parameter has to the tested variable (Unemployment in this case). If a coefficient value of an economic parameter is positive then it trends in the same direction of the tested variable (Unemployment in this case). If a coefficient value is negative then the corresponding variable trends in the opposite direction of the tested variable (Unemployment in this case). It is time to do some math to prove higher taxes and government spending cripple economies. What economic parameters have the biggest effect on unemployment?

In times of high unemployment the federal government debt is increased as it tries to spend its way out of a recession. Once inflation and GDP increase then unemployment levels decrease. But it is important to note that increased federal social benefit payments does not lead to lower unemployment.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Thursday, August 11, 2011

Obama's Lowlights (8/11/11)

Wisconsin – Four of 6 Republicans won their recall election to maintain control of the upper house. Two Democrats have their recall elections next week. The Democrats poured massive amounts of money into the election (mostly from unions) to defeat the Republicans. This is a win for justice and democracy.

U.S. Credit Rating – A Chinese rating firm has also dropped the rating of U.S. Treasury bonds.

Chevy Volt – The latest and greatest electric car from the U.S. automobile industry sold a whopping 125 units in July.

ABC – They did a report smearing all eight of the main GOP Presidential competitors for buying their campaign shirts overseas.

Politizoid – They produce animated political ads on the internet and the Left is calling them racist for using Obamas’ voice (they take clips from his speeches) in some productions.

Debt – With the new debt deal done, the U.S. debt level has officially reached and passed 100% of GDP on day 1 of the agreement. In fact, our debt grew on the first day of the agreement by a record 236 billion dollars.

NRA – They are suing the federal government over new ATF gun reporting regulations in border-states.

Obama Reelection – The Obama campaign web site has made it clear that Joe Biden will remain on the ticket. That is good news for the GOP.

Regulation – In July alone, the Obama administration proposed 229 new rules and 10 economically significant rules costing over 9.5 billion dollars.

Economy – In a campaign speech Obama blamed the struggling economy on the “Big, messy, tough democracy”. Say what? And what is worse U.S. markets have been plunging due to fears of a double dip recession.

DSCC – They are lobbying the DOJ to stop stricter voter ID laws - of course they are claiming the laws are racists.

Alabama – Mexico and 15 other countries are suing Alabama over their new immigration law.

Taxes – We know the Democrats want to tax millionaires more. In 2009, according to the IRS, there were 227 thousand millionaires. If the IRS confiscated all the earnings (100% tax) of these millionaires, it would not account for half of our 1.5 trillion dollar debt in 2011. So spending cuts and entitlement reform are not only needed, they are the only way to significantly reduce debt and unfunded liabilities.

John Kerry – He made the following statement: “The media should not give equal time to Tea Party views”. I guess they should only show his view of the world.

Food Stamps - A shocking new report from the USDA finds that nearly 15 percent of the U.S. population relied on food stamps in May. That's up 12 percent from a year ago, and 34 percent higher than two years ago.

China – They are demanding we get our fiscal house in order since they own 1.2 trillion dollars of U.S. debt.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

I am Sick and Tired of .........

This past week may be arguably the worst in U.S. history for a number of reasons. This got me in a ranting mood.

I am sick and tired of people complaining and blaming others without offering any ideas, solutions, or constructive criticism.
I am sick and tired of socialism winning over capitalism.
I am sick and tired of the federal government destroying the rights of state governments.
I am sick and tired of Obama and his far left policies, his smugness, and his arrogance.
I am sick and tired of progressive Washington politicians who have no business experience.
I am sick and tired of liberal policies that are destroying the sovereignty of cities, states, and countries.
I am sick and tired of the government enforcing Keynesian economic strategies.
I am sick and tired of terrorists being given more rights than our military personnel.
I am sick and tired of judges using the constitution as toilet paper.
I am sick and tired of judges using empathy and social studies instead of the law to decide cases.
I am sick and tired of judges who think they have all powers not denied in the constitution.
I am sick and tired of politicians working in a partisan fashion.
I am sick and tired of people and the government living beyond its means.
I am sick and tired of people and politicians sitting on the fence.
I am sick and tired of people and politicians flip flopping, contradicting, and being hypocritical.
I am sick and tired of people who think they are smarter than everyone else.
I am sick and tired of people who think they are experts in every field such as claiming to understand global warming.
I am sick and tired of the government thinking and acting for everyone as if people are incapable of doing it themselves.
I am sick and tired of the government regulating, mandating, and restricting corporations.
I am sick and tired of government monopolies.
I am sick and tired of people who protest in a disrespectful manner.
I am sick and tired of hearing about global warming and other social issues such as gay rights and abortion.
I am sick and tired of the media and their political agenda.
I am sick and tired of unions destroying jobs and looking out for their interests and not the interests of their members and corporations.
I am sick and tired of any special interest group that influences government policy.
I am sick and tired of government entitlement or any programs that reward mediocrity.
I am sick and tired of people and corporations expecting the government to bailout their irresponsible behavior.
I am sick and tired of the government continuously penalizing responsible citizens and corporations with higher taxes.
I am sick and tired of people and politicians abusing their power leading to criminal or irresponsible behavior.
I am sick and tired of narcissistic personalities who only care about me, myself, and I.
I am sick and tired of people using double standards and stereotypes to describe adversaries and foes.
I am sick and tired of anyone who uses the race card in debates.
I am sick and tired of any power grab that increases the size, stature, and influence of government.
I am sick and tired of people being oversensitive and demanding political correctness in all facets of life.
I am sick and tired of rude people and people who like to brag.
I am sick and tired of oblivious people who lack self-awareness.
I am sick and tired of deadbeats who live off the wealth of others and offer nothing positive towards society.
I am sick and tired of the United States becoming a welfare state.
I am sick and tired of our society that rewards athletic coaches with millions and good teachers with pennies.
I am sick and tired of people soliciting money as if we cannot decide what charities to give to.
I am sick and tired of people talking and texting on their cell phones when they are driving.

I can go on, but you get the point. What are you sick and tired about?

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Monday, August 8, 2011

Obama's Lowlights (8/8/11)

Economy – GDP for the first quarter of 2011 was revised sharply downward from 1.9% to 0.4%. And what’s worse GDP for the second quarter of 2011 was reported to be an anemic 1.3%. Also, U.S. markets have erased their 2011 gains over the past several weeks due to the debt ceiling debacle and weak economic conditions. The unemployment rate dropped to 9.1% as the private sector added 117 thousand new jobs (although this is not enough to keep up with population growth). In fact, the unemployment rate would be 11.7% if the labor force was did not shrink and was the same size when Obama took office. Only 59% of all eligible working Americans are employed, the lowest level in 6 decades. And if all this is not bad enough, S&P lowered the U.S. credit rating.

Automobiles – The Obama administration is going to reset automobile mileage standards to be 54.5 miles per gallon by 2025. It is never good when one person who understands absolutely nothing about the technological challenges and quality tradeoffs is the person in charge of setting unrealistic goals.

Polar Bears – Charles Monnett, who is responsible for managing 50 million dollars to study Arctic wildlife and ecology, was placed on leave for his false writings about polar bears drowning because of melting polar ice. Al Gore has used Monnett’s study in his movie “An Inconvenient Truth”.

Gallup – During the debt ceiling debate Obama’s approval numbers hit an all-time low of 40% at the end of July.

Fast and Furious – During the 2008 campaign Obama spoke about tracing guns, meaning the White House probably had more to do with the failed plan than other agency workers may let on.

Cash – According to the U.S. Treasury, on August 2nd, the federal government had less operating cash on hand (73 billion) than one single corporation: Apple (76 billion). The point is that one single private sector company has done a better job managing its finances than the entire federal government.

Britain - Hip replacements, cataract surgery, and tonsil removal are among operations now being rationed by Britain’s National Health Service.

Internet - In a 19 to 10 vote, a House panel voted in favor of Internet providers maintaining logs of their customers’ activities for one year – in case police need to review the information at a future date.

ObamaCare - Your health insurance premium will now be more expensive thanks to a measure in ObamaCare that forces private insurance companies to provide women with prescription birth control and the morning after pill without having to pay out of pocket costs/a co-pay.

Vanity Fair – Disgruntled liberals from the magazine have theorized the reason behind the failing Obama White House is due to the fact Obama quit smoking.

Biden – He called the Tea Party congressional members terrorists for their handling of the debt ceiling debate.

TSA – They finally announced that they will begin screening passengers based on behavioral patterns, and not just based on random occurrences.

Afghanistan – Thirty-one special ops troops were killed in Afghanistan including 20 Navy Seals.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)


Personal Income Model

Below are the results of running a linear regression model on various economic data (obtained from the Bureau of Economic Analysis [BEA] government site) from 1947 to the present solving for the personal income economic parameter:

n 64

R2 1.00
Adjusted R2 1.00
SE 29.91

Term Coefficient 95% CI SE t statistic DF p
Intercept 65.45 -77.45 to 208.35 71.144 0.92 50 0.3620
Population -0.3092 -1.0563 to 0.4380 0.37199 -0.83 50 0.4098
Unemployment -2.761 -13.077 to 7.554 5.1358 -0.54 50 0.5932
Inflation -1.952 -5.159 to 1.255 1.5966 -1.22 50 0.2272
GDP 0.142 -0.030 to 0.313 0.0854 1.66 50 0.1026
Debt -0.05684 -0.12488 to 0.01121 0.033877 -1.68 50 0.0996
Tax Receipts 0.5459 0.2709 to 0.8209 0.13691 3.99 50 0.0002
Gov Spending -0.2901 -0.6300 to 0.0498 0.16921 -1.71 50 0.0927
Budget -0.04835 -0.44988 to 0.35318 0.199910 -0.24 50 0.8099
Trade Deficit 0.4869 0.2783 to 0.6955 0.10385 4.69 50 <0.0001
Consumer Spending 0.9265 0.6197 to 1.2333 0.15274 6.07 50 <0.0001
State Social Payment -5.385 -6.963 to -3.807 0.7856 -6.85 50 <0.0001
Gov Social Benefits 1.845 1.274 to 2.415 0.2840 6.49 50 <0.0001
State Deficit -1.496 -2.367 to -0.625 0.4336 -3.45 50 0.0011


The economic parameters used to model personal income over the past 64 (n) years are: the U.S. population, the unemployment rate, the inflation rate, the U.S. Gross Domestic Product (GDP), federal government debt, federal government tax receipts, federal government spending, the federal government budget levels, the federal trade deficit, consumer spending, state government budget levels, state government spending on social benefits, and federal government social benefit payments. The intercept value in the above table is not a parameter – it is the value of personal income (in billions of dollars) if all other parameters equal zero. These economic parameters are denoted in the above table.

The R² statistic illustrates how closely the linear regression model resembles a straight line (the ideal condition). If R² equals one then the model is 100% linear and the parameters correlate 100%. On the other hand, if R² is equal to zero then there is no correlation and the data in the linear regression model is completely random. T statistics reveal which of the economic parameters has the best correlation to the parameter being tested (Personal Income in this case). The higher the absolute value of the t statistic, the better the correlation the corresponding economic parameter has to the tested variable (Personal Income in this case). If a coefficient value of an economic parameter is positive then it trends in the same direction of the tested variable (Personal Income in this case). If a coefficient value is negative then the corresponding variable trends in the opposite direction of the tested variable (Personal Income in this case). It is time to do some math to prove higher taxes and government spending cripple economies. What economic parameters have the biggest effect on personal income?

It should come as no surprise when economic times are good and GDP, federal tax receipts, the trade deficit, and consumer spending are all increasing then so is personal income. Generally, when state and federal government spending and debt levels increase then personal income is declining. It is interesting to note that personal income levels have been decreasing with population increases.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Friday, August 5, 2011

Change Tolerance (Part II)

Visionary change can be healthy if and only if there is adequate time and patience allotted to allow the change to be successful. However, more times then not, change is often forced without any thought. One example of change lacking vision and is dividing Americans is the United States’ vastly changing demographics. As the United States becomes more diverse, people are faced with changes these other cultures bring with them. This is important because different races and religions seem to cause about as much divide and tension in the United States as any other issue. For example, look at the heated debate over illegal immigration. The demographic change should be tolerable because it appears to be happening at a fairly slow rate. But, in actuality, it is rather fast. By the year 2050, the Hispanic population will have doubled to nearly twenty-five percent (not including illegal Hispanics), while Caucasians will consist of fewer than fifty-percent of the U.S. population. This is an extremely fast demographic change. U.S. policies should focus on slowing immigration change so it does not create interracial friction and tension. The slower a change happens, the more tolerable it becomes. At the same time, American citizens need to be more tolerable to change and be much more open-minded.

Population change is one example. This argument can be made about any major topic. Roe vs. Wade was an abrupt change of policy and still is a highly controversial Supreme Court decision on abortion. This is another reason why having the states decide on moral issues is appealing. Instead of the whole country subject to one set of rules and laws, each individual state can decide on the policy it wants to support. This is a good compromise to the issue, and it is not as an abrupt change for the country to ponder. Of course, any compromise will not stop the debate on the abortion issue, but the rate of change as seen by the American public is not as severe. Hopefully, that will enable the policy to be more tolerable and not create as much division in the country.

Once again visionary change is what is lacking in Obama policies. How is it visionary to create new entitlement programs when other programs such as Medicare are going bankrupt? How is it visionary to continue to spend money we do not have and borrow from potential enemies? How is it visionary to copy FDR social policies that failed to get the U.S. out of a recession? How is it visionary to own U.S. auto and financial industries when government sponsored industries such as the Post Office, Fannie Mae, and Freddie Mac are going bankrupt? How is visionary to copy Jimmy Carter’s failed foreign policy to talk with our enemies? How is it visionary to regulate the auto and other carbon emitter industries with new CAFÉ and Cap and Tax policies that have failed in the past? It is hard for the American public to practice Change Tolerance when the President is doing nothing more than copying failed policies from past history at a rapid rate. There is nothing unique or creative with this administration’s inability to see 2 weeks into the future. Obama and the Democrats lack the first essential to good leadership and that is sound strategic vision. The American public will not tolerate change that will negatively affect their daily lives and routine.

My Book: Is America Dying? (Barnes and Noble, Amazon.com)

Thursday, August 4, 2011

Obama's Lowlights (8/4/11)

Wisconsin – The cost of education in the state, with the passage of the new law, has declined over 500 dollars per student per year.

Land – Over 30% of the United States’ land mass is controlled by 4 federal agencies.

David Wu – Finally, the scandal plagued Oregon representative has decided to resign. Wu has had a history of mental illness.

Luis Gutierrez – The Illinois Democratic representative was arrested at an open borders protest in Washington. This is the group that wants our borders open to all illegal immigrants. During the protest, all of the Hispanic participants chanted in Spanish, not English. I suppose assimilation to American customs is not part of their citizenship plan.

Individual Debt – Not surprising, the people who are the most in debt are from California and Hawaii. In fact, 9 of the top 10 states having the most individual debt are liberal leaning. On the other hand, 9 of 10 states with the least individual debt come from conservative leaning states (Oklahoma and West Virginia are the top 2). This should come as no surprise since liberals want more government assistance to help them pay down their debt.

Norway Terror Attack – Apparently the terrorists who carried out the terror attacks face a tough life in the Norway prison system that is equipped with luxury furniture, a luxury kitchen, big screen TV’s, refrigerators, and other amenities that most citizens do not have.

Texas – Since the recession started Texas has added nearly three quarters of the nation’s new jobs.

National Security – Former ATF agent, William Newell, admitted he was in touch with White House National Security advisor, Kevin O’Reilly, about project Fast and Furious as early as September of 2010.

Fort Hood – Authorities arrested Naser Abdo because he was planning a second attack on the military base.

Debt Ceiling – The house narrowly passed the second plan introduced by Speaker John Boehner, but the Senate killed the bill on arrival. The Reid plan proposed raising the debt ceiling 3 dollars to every dollar in budget cuts. This plan was also blocked in the Senate. Meanwhile, Democrats urged the President to use the 14th amendment to raise the debt ceiling. It was also rumored that Obama’s own party complained privately that he had not been leading on this issue. Finally, the framework of a deal was reached when Republicans and Democrats agreed they would raise the debt limit by at least $2.1 trillion and would allow Obama to get past his target date: Election Day 2012. In return for this generous political cover, Democrats agreed to a modest $1 trillion in supposed cuts spread out over 10 years; $350 billion of those “upfront” savings come from gutting national security resources. It certainly looked very suspicious and convenient that the August 2nd deadline was just in time so Obama would not miss his 50th birthday party and fundraiser.

The Budget Control Act – Here is a summary of the new budget plan passed by Congress: More than $900 billion in deficit reduction over 10 years through discretionary spending caps. $350 billion of that comes from the Pentagon; Debt limit increased by at least $2.1 trillion -- through 2013; Bipartisan super-committee is tasked with finding $1.5 trillion in deficit reduction by November 23 presumably through tax and entitlement reform. There will be 12 members of the super-committee. House Speaker John Boehner, R-Ohio, House Minority Leader Nancy Pelosi, D-Calif., Senate Majority Leader Harry Reid, D-Nev., and Senate Minority Leader Mitch McConnell, R-Ky., each get to pick three members; Congress must vote on recommendations made by the bipartisan Congressional deficit reduction committee by December 23; If Congress fails to pass the committee proposal, triggers are enacted that spur at least $1.2 trillion in cuts and those will be close to 50/50 split between domestic/defense spending. But the triggers exempt cuts to Social Security, Medicare beneficiaries, and low income programs. The cuts will take effect on January 2, 2013.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Monday, August 1, 2011

Slim Pickings? (Part III)

Rudy Giuliani (Odds to win the nomination: 15:1 – 33 points) is not a favorite of social conservatives, but he is a favorite of independents. Giuliani has name recognition and his entry into the race will make things that much more difficult for social moderates, such as Gary Johnson, to win the nomination. Giuliani could arguably do the best of all contenders with independent voters. Giuliani is also the best candidate to lead this country in times of crisis as he showed with handling of the 9/11 situation in New York City. And for this reason, Giuliani will be a hawk on terrorism policy to keep the U.S. safe. Giuliani, to certain extend is damaged goods based on his dismal performance in the 2008 nomination process, but he may have learned from his mistake to place all his eggs in the Florida primary. Giuliani is a proven executor and has shown the ability to govern effectively in a blue state. Giuliani is fiscally sound and that bodes well for him since the 2012 election will be run on the economy and our fiscal debt crisis. If a Giuliani nomination would bring New York into the conservative win column; that would be huge – but highly doubtful.

Rick Santorum (Odds to win the nomination: 40:1 – 17 points) is a strong social conservative and feels these issues should be front and center. Santorum spent 4 years in the House of Representatives and 12 years as a Senator representing the state of Pennsylvania. The Santorum Amendment proposal to “No Child Left Behind” legislation best describes Santorum’s ideology. The amendment would have required schools to discuss the controversies around for example, the theory of evolution. Santorum also coined the phrase “Islamic fascism” so it is no surprise that he is for enhanced interrogation techniques and even feels taking military action against Iran should be on the table. The problem with Santorum is that he is not that polished and comes off as being angry in debates and discussions. This will undoubtedly turn many voters off, as will the fact that Santorum has minimal experience as an executor or as a business owner.

Gary Johnson (Odds to win the nomination: 40:1 – 29 points) is a social moderate candidate who believes in a woman’s right to choose and is in favor of the decimalization of marijuana. As Governor of New Mexico Johnson had a great record on cutting taxes, bureaucracy, and spending. Johnson vetoed over half of all bills in his first year to cut spending. Johnson’s competitiveness, drive, desire, ambition, and overall willingness to succeed can be seen in his outdoor interests. He has run dozens of marathons and even climbed Mount Everest. Johnson may be the antithesis of Santorum both politically and socially, while Santorum is confrontational, Johnson is much more reserved. In fact, if Johnson is to have any chance during the nomination process he will need to be more aggressive. A Johnson nomination would put New Mexico in play for the GOP.

Rick Perry (Odds to the win the nomination: 8:1 – 33 points) is another Tea Party favorite and can attract social conservatives. Perry has been successful running the Texas economy over the past 10 years with record growth. Businesses and individuals continue to flock to the Lone Star State because of its “business friendly” laws – less regulation and lower taxes. Perry should be a favorite to win the nomination, but he has a lot of negatives to overcome. Perry must overcome his past remarks about succession from the union – those are not the words of a problem solver. Perry must differentiate himself from the unpopular George W. Bush – many wrongfully view Perry as the second coming of Bush. And finally, Perry must answer to some of the budget and fiscal problems facing the Texas legislator. However, Texas, unlike many states facing fiscal crisis, has a slush fund.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Slim Pickings? (Part II)

Ron Paul (Odds to win the nomination: 15:1 – 21 points) is another Tea Party favorite, and like Herman Cain, is really a Libertarian candidate and not a Republican. Paul, like Cain, supports many popular Tea Party fiscal philosophies such as the fair tax, the gold standard, a balanced budget, and entitlement reform. Paul is the true laissez faire candidate – meaning he believes the federal government should play a “hands off” role in both domestic and foreign policy. Paul is an attractive candidate, but his stance on legalizing drugs and other extreme measures may work against him. But Paul’s biggest problem is his electability in a general election match up against Obama. He is old and is not a very gifted orator and debater. But Paul’s ability to raise campaign funds gives him a chance.

Michele Bachmann (Odds to win the nomination: 15:1 – 17 points) is another Tea Party favorite and may be the top choice of Evangelical Christians and those who like Sarah Palin (if she decides not to run). This and her ability to raise campaign cash gives Bachman an outside of chance to win the nomination. Bachman is a true social conservative and the media will demonize her like they did to Palin. Bachmann and her husband raised five children and 23 foster children – making her the family values champion. Bachmann has business experience running the family farm, which received federal farm subsidies. Bachmann was also a tax attorney and coauthored a bill to help put an end to frivolous lawsuits against businesses. However, collecting farm subsidies contradicts Bachmann’s ideology about government handouts and bailouts. Besides, religion and social issues will not be a factor in the general election. Republicans and Evangelicals will even vote for Rudy Giuliani over Barack Obama – given the president’s abysmal record on religious affiliation and social issues.

Tim Pawlenty (Odds to win the nomination: 20:1 – 34 points) recently finished his second term as the Governor of Minnesota. Like Romney, Pawlenty had success running a “blue state”. Pawlenty battled budget shortfalls throughout his administrations. He inherited a 2.7 billion dollar deficit and was able to balance that budget in his first year without raising taxes. He faced several battles over proposed budget cuts and was later forced to increase fees, such as tuition and tolls, to increase revenue as he was faced with another budget deficit to start his second term. The Minnesota budget shortfall is projected to be 4.4 billion this year. Overall, Pawlenty has a solid fiscal track record and the current Minnesota shortfall would have been much lower had many of his proposed budget cuts passed. Pawlenty also tried a cap and trade system in Minnesota, which he later conceded was a mistake and did not work. Pawlenty has put forth the best economic plan of any contender to date. A Pawlenty nomination could bring Minnesota back into the GOP column.

Jon Huntsman (Odds to win the nomination: 20:1 – 41 points) has been taking a long time getting into the field. This is a problem because he still does not have good name recognition. However, Huntsman is a very polished candidate and has by far the best foreign policy credentials amongst the challengers. He was recently Obama’s Ambassador to China and under H.W. Bush he was Ambassador to Singapore as well as his Secretary of Commerce to East Asian and Pacific affairs. Huntsman has already made several visits to Israel during his prestigious career. He also worked as the U.S. Trade Representative under W. Bush. He served 5 years as Utah’s governor prior to leaving the post to be Ambassador to China. Huntsman’s tax policy was highly praised for simplifying the tax code and being business friendly. However, government spending increased rapidly under Huntsman’s watch. Huntsman may not win many votes amongst social conservatives because he supported civil unions, but the upcoming election will be about the economy and not social issues. Huntsman decision to skip campaigning in Iowa is not a good one.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)

Slim Pickings (Part I)

Liberal media outlets across the country are slamming the Republican presidential candidates as being weak. At first glance, I would have to agree. But most Presidents in U.S. history started the primary season as obscure unknowns, especially Democrats. The last three Democratic Presidents – Obama, Clinton, and Carter were not household names when the primary season started. Other media pundits claim the Republican field is weak since conservative constituents are not happy with the candidates and are therefore, recruiting others such as Chris Christie or Paul Ryan to run. There is nothing wrong with trying to solidify a field of candidates, but there is a candidate for any Republican ideology represented in this field – fiscal responsibility, social conservative, Tea Party, and so forth. The key is for voters to select a candidate that is electable in the general election. Let’s break down the field, including my odds and personal rating scale out of 50 points (I will not reveal my rating scale).

Mitt Romney (Odds to win the nomination: 7:2 – 38 points) has to be considered a front runner since he has the highest name recognition by finishing second in the 2008 Republican nomination process to John McCain. Romney has a strong record as being a savvy businessman, most notably by turning the Salt Lake City Olympic Games into a success. Romney is also a polished politician with 8 years of executive experience as Massachusetts’ Governor. But Romney, like all candidates, has flaws. Romney is a flip flopper, especially on social issues, but no worse than Obama’s record as a flip flopper. Romney’s biggest challenge is his record on healthcare. ObamaCare mimicked Romney’s healthcare plan in Massachusetts, including the individual mandate. If this election is about repealing ObamaCare, Romney has a big obstacle. However, this election is about the economy and Romney can win that argument with his fiscal record. Besides, Romney’s explanation for RomneyCare in Massachusetts is a logical one, but it will not win him any votes in the primaries. Romney rightfully argues that healthcare should be a state issue decided by the people of each state. Romney was only giving the people of Massachusetts what they wanted. And the Massachusetts individual mandate to own healthcare does not violate the Constitution’s Commerce Clause since it is intrastate and not interstate commerce. A Romney nomination could bring Massachusetts and Michigan (His dad was Governor of that state) into play for the GOP. Finally, Romney is an excellent fund raiser and that should bode well for him. In early head to head polling against Obama, Romney is doing by far the best of any Republican candidate.

Newt Gingrich (Odds to win the nomination: 60:1 – 19 points) is already damaged goods. His attack on Paul Ryan’s budget plan angered many, although it should be okay to openly debate potential pitfalls with the proposal, Gingrich’s attack stepped out of bounds. Gingrich has a way of placing his foot in his mouth too often and will have to explain why his lifestyle does not follow his family values ideology (he has had several affairs and he has been married 3 times). On the other hand, Gingrich is a walking historical encyclopedia and could arguably be the best person to debate Obama one on one. And let’s not forget Gingrich has a record of fiscal responsibility when he worked with Bill Clinton to obtain a balanced budget.

Herman Cain (Odds to win the nomination: 20:1 – 25 points) is a true dark horse, but he is already gaining some momentum. Cain is a true Washington and political outsider since he never held an elected office. Cain’s background in business and mathematics makes him the choice of many Tea Party followers – since he has a fiscal track record of success. Cain worked for Pillsbury subsidiaries Burger King and Godfather’s Pizza and turned the business units he ran into profit winners. Cain still may have to answer for his role with an energy company, Aquila, which went belly up. Cain also served on the board of directors and was a onetime chairman of the Federal Reserve Bank of Kansas City. Cain is also a cancer survivor and that shows his determination and resolve. Still, Cain is not a very polished candidate on foreign policy. And his ethnicity will not win Cain any votes from African Americans who will continue to support Obama by at least a 15 to 1 advantage. Finally, Cain has yet to prove he can win a political election – he failed to win the Georgia GOP primary for Senator back in 2004.

My Book: Is America Dying? (Amazon.com, Barnes and Noble)