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Government Program for Disabled Workers Investigated for Fraud

Posted by Steve Markowitz on July 31, 2015

CNN has reported that the US Department of Justice has initiated an investigation into a huge governmental program designed to assist severely disabled Americans find work.  According to the report, AbilityOne and SourceAmerica are being investigated for potential infractions including financial fraud, inappropriate steering of contracts, and obstruction of justice.

The AbilityOne program is responsible for spending approximately $3 billion of taxpayer funds annually, which is supposed to be funneled to companies with at least 75% of their workforce being severely disabled.  This program was initiated during Franklin Roosevelt’s administration in 1938.  Typical of government programs, once started they continue into perpetuity.  This program’s continuance is questionable given the many newer laws that protect handicap workers, including the infamous Americans with Disabilities Act (ADA).

According to CNN, up to half the companies receiving contracts from AbilityOne and SourceAmerica under this program do not meet the requirements of employing severely disabled in appropriate numbers.  In other words, this program is yet another form of crony capitalism that permeates our government.  In this case, approximately 10 large companies are receiving the lion’s share of this program’s funds.  This degradation of a program initiated with the best intent is not surprising given that the person who runs AbilityOne is a presidential appointee, in other words a political hack.

Very large organizations are difficult to control under the best of circumstances.  Lines of communications are tenuous and complex.   Holding people accountable for their performance is nearly impossible.

The outrageously large US federal government has added burdens that ensure its inefficiency and ineffectiveness.  This includes political appointments of unskilled managers, as well as a bureaucracy that answers to no one.  Its employment rules also make it nearly impossible to terminate ineffective employees.

The greatest albatross on the government’s ability to reform itself is its nearly limitless budget that is only possible because of deficit spending.  Only by removing the government’s ability to borrow funds for other than catastrophic needs could Americans hope to limit governmental corruption.  Limited budgets force competition between different agencies for scarce funds, help weed out inefficient agencies, and would also help create transparency as groups vie for funds.

Posted in Government Ineptness | Tagged: , , , , , | 2 Comments »

Hillary Clinton’s Email Scandal Grows

Posted by Steve Markowitz on July 24, 2015

Earlier this year we learned that Hillary Clinton utilized her private email account to conduct government business as Secretary of State, contrary governmental regulations.  In response to the issue, Ms. Clinton countered by claiming her predecessors took similar actions.  In addition and more importantly, she claimed that no secret information was sent via her private email account stating with the New York Times quoting her: “I did not email any classified material to anyone on my email.  There is no classified material.   I’m certainly aware of the classified requirements and did not send classified material.”

When it was later reported that some of the emails included secret material, Clinton then modified her story claiming that some of the material sent was unclassified at the time, but later may have had his classification changed.  A State Department employee back this claim earlier this month stating: “It’s not uncommon that something that you’re sending now on an unclassified network could in later years or later months be deemed to be classified either because the passage of time made it so or because events on the ground have borne out.

The New York Times today reported that both Ms. Clinton’s and the State Department’s earlier claims concerning the emails were false.  According to the report, Inspector General I. Charles McCullough of the Intelligence Community has determined that Clinton sent material classified as “secret” via her private email account.  The Inspector General reviewed 40 emails in Clinton’s private inbox and found 40 that included secret material.  There are thousands of additional emails that have not yet been reviewed.

With the severity of the breach, the Inspector General has referred the matter to the counterintelligence division of the FBI.  At the very least this action indicates that Ms. Clinton was not truthful in her response to the emails’ issue.  At worst there could be criminal violations involved.

When scandals hit a campaign, some politicians gracefully bow out of the election admitting their error.  However, Hillary, like husband Bill, has a different view of lies and morality.  We should expect Hillary to come out swinging, yet again claiming a right-wing conspiracy against her.  However, if there is a conspiracy here, she might first look to the White House given this President’s not being overly fond of the Clinton’s.

Posted in Politics | Tagged: , , , , , , | Leave a Comment »

Americans Believe Race Relations Deteriorating

Posted by Steve Markowitz on July 23, 2015

A New York Times/CBS poll indicates the deteriorating race relations in America.  Of those who responded, 60%, both black and white, believe race relations are bad with 40% indicating that it has gotten worse since Barack Obama’s election seven years ago.  This is a significant turnaround given that shortly after Obama’s first election approximately 66% of Americans surveyed indicated a belief that race relations were good.

Indicators of America’s poor race relations have been demonstrated through well-publicized events.  Early in Obama’s first term was the incident involving the arrest of African-American professor Henry Gates in Massachusetts, which President Obama commented on national TV as the police acting “stupidly”.  Later came the shooting of Treyvon Martin that was promoted in the media and by some politicians as a race issue.  Then came the killing of Michael Brown in Ferguson, Missouri by a police officer that was initially portrayed in the press as a wrongful and racially motivated shooting leading to significant civil unrest in Ferguson.  The US Department of Justice and a grand jury later determined that Michael Brown was the aggressor and the shooting was justified.

Most recently there has been the civil arrest and significant rioting in Baltimore, Maryland that occurred after the death of Freddie Gray while in police custody.  Six police officers have since been charged and are awaiting trial.  There have been other incidents of African-Americans being shot by police that have also caused strains along racial lines.

The African-American community may have legitimate grievances against some police departments that need to be addressed.  However, this does not explain why race relations have deteriorated in the last seven years, as a New York Times/CBS poll indicates.  Are the police becoming less sensitive to the needs of their local communities?  Are the local communities becoming less tolerant of the police?  Is racism a significant factor in inner cities?  An open discussion on these important questions could only help improve race relations going forward.

After the election of America’s first African-American president, many Americans, irrespective of political philosophies, believed that race relations would improve because of Obama’s election.  The fact that this has not occurred is therefore lost opportunity.  Many factors could be involved with the negative direction of America’s race relations.  At the same time, as president, Barack Obama must accept some responsibility.  It is evident that he overpromised the benefits of his economic policies under which less advantaged Americans have not fared well.  In addition, the President’s rhetoric has placed blame for the failed policies on others including the Congress (Republicans) and by inference wealthier Americans and racism.  This has not led to viable economic solutions, but have instead fanned the flames of racial division.

Posted in President Obama, Racism | Tagged: , , | 1 Comment »

Government Pursues Bad Mortgage Policies with Veterans

Posted by Steve Markowitz on July 17, 2015

Various policies and practices led to the 2008 financial meltdown that nearly took down the world’s economic order.  Many were related to the inappropriate use of debt.

Beginning in the mid-1990s, the Federal Reserve began aggressively using low interest rate policies to offset economic downturns.  This included the Asian markets’ turmoil in the late 1990s, the Datacom and Dot com busts, as well as the economic downturn caused by 9/11.  While these low interest rate policies offered short-term benefits, in the long term they created significantly damage to the economy.

Downturns are a necessary part of economic cycles.  They are often caused when supply and demand of goods and/or services go out of balance.  During downturns excess goods and services are sold off and depressed prices, which ultimately leads to rebalancing supply and demand and then economic growth as more goods and services are required.

The low interest rate Fed policies, along with governmental bailouts, led to huge imbalances including the housing bubble.  With historically low interest rates and lax lending practices, housing prices appreciated on an unsustainable path.  Then, when appreciation turned to depreciation, millions could no longer pay their mortgages leading to the collapse of 2008.

Under typical conditions an economic calamity as encountered in 2008 suffices to “teach” a generation to avoid unsound economic practices.  However, these are not normal times. After 2008 Federal Reserve and central banks doubled down on the low interest rate policies.  While they tempered the effect of the meltdown in the short term, there are responsible for the lackluster recovery, the slowest since the Great Depression.

Pied PiperThe American government often uses interest rate policies to implement social manipulation pursued by Progressives.  The 2008 housing bubble was fed by the government promoting mortgages to income brackets that could not afford to make the monthly payments.  Millions then lost their homes and any equity in them. They would have then better served not purchasing the houses in the first place, but were cajoled into doing so by governmental intervention.  However, even this lesson has not been learned.

Once again the government is promoting imprudent mortgage policies, this time to veterans.  The company NewDay USA promotes as a benefit in one of the headings on its website newdayusa.com states: We’re a Different Kind of Lender.  As a Veteran, You Can Borrow Up to 100% of the Value of Your Home, Not Just 80%.”  NewDay USA goes on to say: ”With up to 100% of your home’s value available, including mortgage balance, you could qualify for thousands of dollars more from NewDay USA.”

NewDay USA could not make this offer without the backing and support of the US government.  This crony capitalism not only benefits the stakeholders at NewDay USA, but also places at risk their customers, veterans who served their country.  It is imprudent for any homeowner to not have at least 20% equity in their home.  This equity cushion not only helps ensure that their mortgage payments will be set at a reasonable level given their income, but it will make it more likely that their homes’ value will remain above the market price during inevitable downturns.

Some politicians back imprudent policies with good intentions, but little understanding of economics; the fools.  Others promote such policies for less benign reasons including crony capitalism; the greedy.  Neither serve the country well.

New Day

Posted in Debt, Governmental Intervention | Tagged: , , | Leave a Comment »

Obama Downplays Radical Islamist Tennessee Shooting

Posted by Steve Markowitz on July 17, 2015

Yesterday came the sad story of four innocent Marines in Chattanooga, Tennessee being killed by a radical Islamist who happened to also be a resident of the United States.  Those who understand that the West is at war with radical Islam are saddened, but not surprised by the attack.

The Wes’s contemporary war with radical Islam has its roots in the 1980s with growing strength of the anti-Soviet movement in Afghanistan that was ultimately controlled by radical Islamists. Then, with the dissolution of the Soviet Union, a power vacuum was created in parts of the world that had large Muslim populations.  In some of these areas radical Islamists fill the vacuum.

After 9/11, George W. Bush responded by first invading Afghanistan and later Iraq.  The invasion of Afghanistan was an appropriate in response to the Taliban’s harboring of the terrorist leadership responsible for the 9/11 attacks.  It was, however, a mistake to not have withdrawn from Afghanistan after successfully routing the terrorists.  The invasion of Iraq was a flawed strategy that took down a tyrant who at least controlled the forces of radical Islam and was also an offset to Iranian power.

Since becoming President, Barack Obama has taken a different, but also flawed strategy.  Where radical Islam has become a conventional military force, ISIS, Obama refuses to take the necessary steps defeat this army.  In Libya, Obama helped bring down the dictator Qaddafi (the George W. Bush approach) without considering the likely consequences of radical Islamists filling the vacuum.

As for the nonconventional military threats from terrorists, the President’s policies have attempted to play whack-em, using standoff drones to kill terrorist leaders.  However, this approach does not take out the foot soldiers that are then able to carry out their own retribution.  This approach also does not stop terrorists from using social media to radicalize citizens or residents of Western countries, such as exemplified in the current Tennessee killings.

There are a couple of ironies raised by the Tennessee tragedy.  First, the dead Marines, experts and the use of guns, were barred from carrying them in what is a gun free recruiting station.  While this lame policy was initiated under George H. Bush, Obama could have used his executive authority to remove the policy given the known terrorist threats to military bases.

Even more serious to successfully combating a war that we have not chosen, President Obama refuses to name the enemy in this generational war that is being waged on the West by Radical Islam.  The video clip below exemplifies the naivety of the Obama approach.  It also helps explain why the forces of radical Islam have strengthened under President Obama.

Posted in Radical Islam | Tagged: , , , , , , , | Leave a Comment »

Governmental Errors in Headlines

Posted by Steve Markowitz on July 13, 2015

July has not been a good month for government and those that look to it to resolve societal challenges.

After the carnage in a South Carolina church that resulted in the death of nine African-Americans at the hands of deranged racist, Progressives sought to use the tragedy to push a gun control agenda. Then, last week it was announced that the accused shooter, Dylann Roof, was not legally able to purchase the gun used in the massacre.  Admitting that the background check of Roof is not properly handled, FBI director James Comey said: “This rips all of our hearts out“.  This is also an indication that America does not need more laws, but competent enforcement of current laws.

In San Francisco, 32-year-old Kate Steinle was murdered on Pier 14.  Any murder of an innocent is a tragedy, but it becomes especially troubling when it could have been prevented had authorities acted responsibly.  Ms. Steinle was reportedly shot by Francisco Sanchez, who is not only an illegal alien, but had been deported multiple times and had multiple felony arrests in the United States.  Adding an explanation point to this avoidable tragedy, it was reported by the Associated Press that the gun used in the murder belong to a federal agent, but was reported stolen.  Again, additional gun control laws would not have prevented the murder.  However, had the city of San Francisco reported to the federal government that Sanchez was being released from jail, as requested by the federal government, he would have been deported Incometenceprior to the killing.

Finally, last week the Country learned of a very damaging, but less violent event involving governmental incompetence to the max.  Over 25 million Americans had their personal information stolen from a governmental computer system.  This led to the resignation of Katherine Archuleta, the director of the Office of Personnel Management.  Ms. Archuleta’s resume included working for the Obama administration’s reelection team.  It is little wonder that she lacked competence computer/personnel security.

Over the years those with a Libertarian view of government have railed at the crony capitalism, waste and incompetence of government.  As the government has grown, increasing its reach deeper into the economy and society, the opportunities for incompetence and abuse increases.

Posted in Government Ineptness | Tagged: , , , , , | Leave a Comment »

Department of Homeland Security Focusing on Global Warming

Posted by Steve Markowitz on July 10, 2015

In another sign of government gone wild, The Hill has reported that the Department of Homeland Security (DHS) is giving high priority to “protecting” the American people from global warming.  DHS’s quarterly report report lists climate change as one of its top priorities saying it “present major areas of homeland security risk”.

Evidently DHS has greater concern about the potential effects of climate change than ISIS.  No wonder the terrorists are growing in strength throughout the world.

The Department of Homeland Security started under the Bush Administration in response to the 9/11 attacks.  It has since grown to approximately 240,000 employees with an annual budget of nearly $40 billion.  These huge numbers are just another indication of how government agencies grow after being seeded.  These agencies become self-perpetuating, as they grab for power and taxpayer funds.  DHS’s jump from protecting America from terrorists to potential climate change affects is a prime example of the corruption of government.

There are various arguments that can be made that would indicate that the theory of man-made global warming is suspect.  However, assuming for the moment that man is radically changing the environment, one indication that science is not being appropriately used in the discussion is the one sided conclusions offered concerning the potential climate change.  All effects are promoted as negative, which in itself is absurd.  Any climate change has positive and negative impacts on different parts of the globe.  To suggest otherwise is an indication of the fallacy of the science and the bias of the argument.

Posted in Global Warming, Government Waste | Tagged: , , , | Leave a Comment »

Liberal Hypocrisy on Gay Marriage

Posted by Steve Markowitz on July 7, 2015

With the Supreme Court’s decision on gay marriage, the subject has become perhaps the most significant contemporary domestic issue of the year.  Listening to the political narrative, if an extraterrestrial visited the earth arriving in the past two weeks, that entity would believe that gay marriage has been advocated by mainstream liberals for many years, an incorrect narrative.

This Blog’s Libertarian and Constitutional focuses dictates that ones’ sexual preferences should be irrelevant to the federal government.  The Constitution does not mention sexual preference, be it straight, gay, or asexual and there is not an issue for the federal government.  The slippery slope we travel does not relate to gay rights, but instead a power grab by the federal government into areas where it has no Constitutional authority.  While today that may benefit a part of society and be a popular decision, tomorrow’s governmental power grab may not be so benign.

To my friends on the Right, it would be instructive to read about the rather open sexual practices of some of the Founding Fathers who would be hard-pressed to lecture others on the subject.  This reality might temper the Right’s intrusion into American’s private, or what used to be private, lives.

For my friends on the Left, a review of statements concerning the definition of marriage by their mentors just a few years ago would be instructive.  Certainly this should be done before the Left further vilifies those that now disagree with their definition of marriage.

With the Supreme Court’s landmark ruling on gay marriage, the Left hardly missed a beat before vilifying those that disagree with the decision.  Before throwing stones they would do well to review the dissenting views on gay marriage from two of the highest profile Democrats, Hillary Clinton and Barack Obama as indicated below.  Those that live in glass houses shouldn’t throw stones!

Hillary Clinton- 2004

“I believe marriage is not just a bond but a sacred bond between a man and a woman.”

Barack Obama – 2008

I believe that marriage is the union between and man and woman.   … For me as a Christian, it is also a sacred union.”

Posted in Libertarian | Tagged: , , , | Leave a Comment »

Civil Rights Activist Andrew Young on the Confederate Flag

Posted by Steve Markowitz on July 1, 2015

After last week’s tragedy in Charleston, South Carolina, significant focus has been on Confederate Flag often visible in the South.  Many have expressed the strong opinion that the flag should be removed from both public and private venues.  While this Blog believes the Confederate Flag can be divisive, attacking inanimate objects and denigrating freedom of speech is a slippery slope that has potential negative consequences that far outstripped potential benefits.

Former Atlanta Mayor Andrew Young has impeccable Civil Rights credentials including marching with Dr. Martin Luther King.  He points out in the video below that; “The problems we face don’t have anything to do with the flag.  The fact is that 93 percent of the black people killed are killed by other black people.  So if black lives matter, let us start believing that we matter.”  Look for Mr. Young to be attacked by Progressives for not towing the Leftists line.

Today’s society often deflects from addressing complex problems.  When faced with significant challenges, society may seek simple solutions that include attacking symbols, rather than addressing underlying causes for the problems.  A high profile murder likely leads to the opportunity to promote gun-control.  The death of an African-American at the hands of the police will lead to an indictment of the entire police force.  A racist attack, such as occurred in Charleston, focuses on the Confederate Flag.  Similar to any of these simplistic solutions, banning the Confederate Flag will not eliminate racism.

Ambassador Andrew Young is to be commended for his desire to seek real solutions to social problems that affect various parts of our society.  President Obama would do well to bring in clear-thinking people like Young to his cabinet instead of the divisive radicals he has often brought into his Administration.

Posted in Racism | Tagged: , , , , , , , , | Leave a Comment »

Greek Banks Close for a Week as Crisis Grows

Posted by Steve Markowitz on June 29, 2015

The Wall Street Journal reported that Greece has ordered that its banks remain closed for the next week to the stem panicked cash withdrawals by depositors.  This drastic move indicates that the five year long Greek debt crisis is coming to an end game.

After the financial meltdown occurred in 2008, the economic folly of Europe’s single currency, the Euro, became apparent.  The European Union was created in an effort by Europeans to create a political climate that would lessen the likelihood of future wars on their continent.  This desire was a reaction to the carnage that inflicted on Europe during two world wars in the 20th century.  While the political idea was noble, little thought was given to the economic consequences that a central currency would lead to.  Those consequences are now playing out.

The Euro was destined to create an economic calamity because the political union was not accompanied by a truly economic union.  European countries maintain their own banking systems and Euro central bank was weak.

After the European Union and the Euro were created, the more efficient and stronger economies of North Europe, specifically Germany, obtained the lion share of benefit created by the Union. With nearly all European countries having a single currency, less efficient countries had their cost of labor increased in relation to more efficient ones.  As a result, the poorer countries had a artificially strong currency that enabled them to consume increased amounts of the more efficient countries’, i.e. Germany.  Through the Euro, Greece had to access to relatively cheap borrowing via an overall European credit rating that did not reflect the realities of individual countries.  As a result, Greece and other Southern European countries borrowed more funds than they could afford to pay back and use these funds to purchase imports from Germany and other exporting countries.

When the recession hit, Greece and other countries were unable to make payment on their debt.  This led to a battle between the creditor countries such as Germany and debtors like Greece.

For five years the Greece debt crisis has been a can kicked down the road.  Creditors including, Germany, have been unwilling to forgive Greece’s debt, even though Greece is not a position to repay it.  Had Greece continued to have its own currency, it would have devalued versus the German currency making its exports cheaper and more likely that it would have been able pay back its debt obligations.  The single currency has curtailed this natural rebalancing mechanism of sovereign debt.

Greece has been operating under an austerity program for some years in an effort to pay down its debt obligations.  That effort was doomed to fail since austerity does not address Greece’s uncompetitive position.  Its current efforts to stop the panicked withdrawals At the Greek banks will also fail since this radical step will only create more panic in Greece and other southern European countries.

It is difficult to determine how the next few days will play out with the Greek crisis.  There are basically two long-term solutions 1) Greece drops out of the European Union and reverts back to its own currency, while at the same time defaulting on its debt, or 2) Greece’s creditors, mainly Germany, writes off the loans.  Either scenario has very painful economic consequences.  Either would require a realignment of the Euro and the European Union to correct the economic deficiencies of this unnatural union.

Greece is a relatively small economy.  Had it not been for the Euro, its default would have had only minor consequences for the world economy.  However, similar to international banks that were allowed to become too big to fail, the European Union’s single currency has made the consequences of even smaller economies European countries defaulting too big to fail.

Given the hard choices for Europe, look for the politicians and bankers to do whatever is possible to kick the can down the road.  This means that it is likely they will give Greece more loans to continue the illusion that the country is not defaulting on its loan obligations.  However, that bit of alchemy would only push the crisis off for a short period of time.

Posted in Debt, Greece | Tagged: , , , , , | Leave a Comment »


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