Robert Wenzel shows how the media is reporting numbers more favorable to the theme of a recovery, but when analyzed closer, things don’t look so good.

The media is reporting that for the week ending Nov. 21, the figure for initial jobless claims was 466,000, a decrease of 35,000 from the previous week’s revised figure of 501,000 that has been released by the Labor Department.

But this is a seasonally adjusted number.

Without the Labor Departments special “seasoning” the number of actual initial claims under state programs totaled 543,926 in the week ending Nov. 21, an increase of 68,080 from the previous week.

Thus, the Labor Department numbers have swung the jobless claims picture by over 100,000 for the last week, from a decrease to an increase.

Which means, if you applied for unemployment last week there is a one in five chance your claim has been seasonally adjusted from the data.

Happy Thanksgiving.

via EconomicPolicyJournal.com: A Second Look at the Lower Initial Jobless Claims Number.

Some in Congress are calling for a bi-partisan panel on ways to cut the deficit. As you can imagine, I’m laughing my butt off right now. Can you imagine telling your spouse you  need to get an outside advisor to help you figure out why you are getting further into debt as you go out and buy a bunch of stuff you don’t need on your credit cards?

By JONATHAN WEISMAN and JOHN D. MCKINNON

WASHINGTON — The White House is considering a bipartisan commission to tackle the nation’s swelling deficit, as it seeks to show resolve on a problem that threatens its broader agenda.

Top White House officials, including budget director Peter Orszag, met Tuesday with Senate Budget Committee Chairman Sen. Kent Conrad to discuss establishing such a commission, which has been pushed by Mr. Conrad, a North Dakota Democrat, and his Republican counterpart on the committee, Sen. Judd Gregg of New Hampshire.

Chuck Marr, a budget aide to the Democrats’ former Senate Majority Leader Tom Daschle, said some kind of commission or budget summit could be the only way to bring Republicans into the decision making in the hopes of generating support for cutting cherished programs or raising taxes.

So now the Democrats want to bring in Republicans to support cutting cherished programs. Isn’t this as they are about to pass a huge new program that isn’t supported by Republicans?

But House Speaker Nancy Pelosi (D, Calif.) and senior Democrats such as House Appropriations Committee Chairman David Obey of Wisconsin have vociferously opposed delegating tough decisions to outside panels or commissions.

Taking concrete steps to cut spending and raise taxes, always politically difficult, has become even harder given the U.S. economy’s weakened condition. With projected deficits averaging more than 5% of gross domestic product over the next decade, the enormity of the task makes it more daunting. So does the looming 2010 election, when Democrats face the possibility of big losses.

via White House Weighs New Panel to Tackle Deficit – WSJ.com.

Holy crap! Who would have thought I would ever agree with Nancy Pelosi. I better reconsider my belief. I was under the impression that we elect these idiots to make the tough decisions. I didn’t think we elected them to create panels anytime things are politically tough to do. They say it’s politically difficult, but yet it seems people on all sides are complaining about the deficit. The only difference seems to be where each side thinks the cuts should come from. I have a great idea that will solve this. Cut everything. Pass legislation that will move towards the end of medicare, social security, etc while protecting those who are on it or will be on it shortly. Young people know they will not get any of these benefits, so quit robbing them to pay for a failing system. For the left, shut some damn bases down around the world. Do we really need the cost of bases in Germany, Japan, South Korea, etc?

Was that hard? Do we really need a commission to make a report that probably wouldn’t include common sense ideas anyway? Now that this has been put out there, congress can use it. They don’t even have to pay me. Well, maybe they could let me not pay taxes for a few years.

A recovery still is looking unlikely. I’m sure glad we spent $800 billion on TARP, you know bailing out Wall Street to bail out Main Street.

By DAMIAN PALETTA

U.S. lenders saw loans fall by the largest amount since the government began tracking such data, suggesting that nervousness among banks continues to hamper economic recovery.

Total loan balances fell by $210.4 billion, or 3%, in the third quarter, the biggest decline since data collection began in 1984, according to a report released Tuesday by the Federal Deposit Insurance Corp.

via Lending Declines as Bank Jitters Persist – WSJ.com.

There has been a lot of buzz about Obama’s Race to the Top program to improve public education. Currently, the Education Secretary Arne Duncan, Newt Gingrich and Rev. Al Sharpton are traveling the country together to promote the program.In this morning’s Wall Street Journal, former congressman Harold E. Ford Jr, a former IBM Chairman and a founder of The Broad Foundations wrote an article calling for accountability for President Obama.

By HAROLD E. FORD JR., LOUIS V. GERSTNER JR. AND ELI BROAD

For decades, policy makers have talked about significantly improving public education. The problem has been clear: one-third of public school children fail to graduate, there are embarrassing achievement gaps between middle-class children and poor and minority children, and the gap between our students and those in other countries threatens to undermine our economic competitiveness. Yet for the better part of a quarter century, urgent calls for change have seldom translated into improved public schools.

Now, however, President Barack Obama has launched “Race to the Top,” a competition that is parceling out $4.35 billion in new education funding to states that are committed to real reform. This program offers us an opportunity to finally move the ball forward.

To that end Mr. Obama and Education Secretary Arne Duncan are pushing states toward meaningful change. Mr. Duncan has even stumped for reform alongside former Republican House Speaker Newt Gingrich. Yet the administration must continue to hang tough on two critical issues: performance standards and competition.

First, I must say Newt Gingrich in pursuit of trying to be bipartisan has become a stooge of the left. If he thinks giving his support is going to get any real reforms, he’s become Charlie Brown hoping Lucy won’t move the ball this time. What’s worse is no one will no if he doesn’t agree with the ultimate outcome, but his name will be used for what will be called a “bipartisan effort”.

Already the administration is being pressured to dilute the program’s requirement that states adopt performance pay for teachers and to weaken its support for charter schools. If the president does not remain firm on standards, the whole endeavor will be just another example of great rhetoric and poor reform.

Competition among the states is also vital to reform. The administration is resisting the temptation to award funds to as many states as possible. And that’s good. To be effective, Race to the Top funds cannot become a democratic handout. Competition brings out the best performance. That’s true in athletics and in business, and it’s true in education.

Wow, all the sudden liberals realize competition among states is vital to reform, and competition is what brings out the best results? Who said progress isn’t being made. If they now realize this, can we make more moves back towards federalism, in which we had states competiting? Better yet, how about we get the federal government out of education altogether? How can you have competition when the government always promotes one size fits all policy on all states? Can we remove much of the federal laws and allow states to compete for the best standards of living? Citizens can then again vote with their feet. When the federal government creates national laws, citizens cannot hold states accountable. It doesn’t matter where you go, you still have to deal with the federal law. Your only choice is to leave the country, which ultimately harms our country.

The old way of doing business would be to spread around the money so no one could be held accountable. The new approach is to give governors authority and responsibility, and then hold them accountable for results.

For decades, adult interests have been at the forefront of public education. Reform has been derailed by adults who wanted to protect the status quo and enjoy lifelong benefits. This time the focus will be on learning in the classroom. What’s important is that the administration is demanding that every child receive an education that prepares him or her for college or for work. Without that we will continue to be sidetracked by insignificant issues.

Again wow, some truth from these guys. Ok, so now I must ask if we know this, then why aren’t we redoing all the federal dollars? Why are we continuing to spread money around?  According to the Department of Education’s website here is how much money they are spreading around with no accountability.

ED currently administers a budget of $62.6 billion in regular FY 2009 discretionary appropriations and $96.8 billion in discretionary funding provided under the American Recovery and Reinvestment Act of 2009

via U.S. Department of Education Budget Office.

Wow, imagine what we could do if we actually focused over $150 billion on the classroom? Instead you have teacher’s unions setting up life long cushy jobs and retirement plans that private sector workers could only dream about.

States that have the track record and leadership in place to implement Mr. Obama’s aggressive reform menu—of enforcing rigorous academic standards, creating data systems that track individual student performance, ensuring teacher quality and effectiveness, and turning around failing schools—deserve the funds to show that our public schools can again lead the world.

We have yet to prove, on a systemic basis, that we can dramatically improve America’s public schools. Race to the Top is a chance to start small, hold states accountable, and expand proven reforms to the rest of the country.

via Harold E. Ford Jr., Louis V. Gerstner Jr.,And Eli Broad: Race to the Top in Education – WSJ.com.

Ok, here is the root of the problem. You are rewarded based on your record of implementing “Mr. Obama’s agressive reform menu”. The problem is the whole damn thing is captive to politics. Assume this policy improves results. After Obama is replaced, you then have to worry about who’s menu is next? I’m not saying Obama’s menu is good, because I don’t know what it is. The problem is you hold the carrots way above where the work actually takes place. The further you get away from the end participants, the harder it is for you to dictate good policy and the harder it is to know what’s working.

If you want real reform, the federal government should get out of education. Governors should then open education to all providers public and private. Parents should be able to take either their own taxes or their allocation of taxes per student to any school they want. This would generate massive competition and a massive improvement in the education of children in this country. Even the writers of this article admit that competition is what generates results. Are they advocating only a little competition? Don’t they want spectacular results, or are they too afraid they’d loss their political power?

Think we have a moral government? What kind of government tries to pillage families when a loved one passes? That is what the government does with the death tax.

Kevin Hancock simply wants to harvest trees — sustainably — and create jobs in the process. The federal government may put a stop to all that.

His business, Hancock Lumber, has been in the family for six generations. It owns 30,000 acres of Maine timberland and employs 550 people. But Kevin already knows that when his elderly mother dies, he’ll have to sell off huge swaths of his land to pay the ensuing tax bill.

He recently warned a Senate committee that “once it has been sold to a developer, it will be parceled off and will no longer be maintained as publicly open forests. This is particularly a shame in southern Maine, where green space and curtailment of sprawl is a major political issue.”

It’s an example of the long reach of the death tax — the penalty families have to pay when a loved one dies and leaves them significant assets. Yet, for Hancock and many others, some relief may be in sight.

In 2001, lawmakers passed a law that gradually phased out the levy. The death tax has been stepped down from 55 percent (for those in the top tax bracket) eight years ago to 45 percent. But that gradual decline was just a prelude for 2010, when the tax will — finally — disappear altogether.

Unfortunately, like the killer in so many slasher movies, the death tax could return to menace family businesses again in 2011. Unless Congress acts, it’s scheduled to return to the obscene 55 percent rate after next year.

via Time to bury the ‘death tax’ – Pittsburgh Tribune-Review.

Wonder how many of the 550 people Hancock Lumber will have to layoff when they have to sell off their land to pay Uncle Sam? I wonder how many employees are hoping that Kevin Hancock’s mother dies next year, so they don’t lose their jobs? The death tax is completely immoral. Taxes have already been paid as the wealth was earned, and yet they try to take huge chunks of it from the very people the deceased person worked to hard to save for.

I want to know if any of these so-called scientist are going to go to jail? If anyone in corporate America had committed fraud one tenth the size of this fraud, they’d be tried in the media and locked up in short order. We threw Martha Stewart in jail for selling a stock on insider information, a crime that shouldn’t even be a crime in the first place. Bernie Madoff’s ponzi scheme did harm to others. In no way was his crime inflicted on every man, woman and child in the world, and we sent him to jail for 150 years.

It could be the smoking gun that finally quashes the climate-change industry.

The Daily Telegraph of London reports that some of the world’s top climate scientists engaged in nothing less than fraud to perpetuate the theology that man is responsible for supposedly cataclysmic global warming.

The purported evidence comes in the form of thousands of e-mails and other documents pilfered from the computer servers of the world-renowned University of East Anglia Climatic Research Unit.

One e-mail “refers to a ‘trick’ being employed to massage temperature statistics to ‘hide the decline’ in temperatures.” Which only solidifies the credibility of those who contend the “science” of global warming is anything but “settled” and is in every way “junk.”

Couple this revelation with a new book by Christopher Booker that, claim by claim, debunks what the grim reapers of climate change have been peddling.

Nevertheless, the world’s politicians are “proposing the most damaging measures ever put forward in history — cuts in carbon emissions, if implemented, would plunge our world back to the Dark Ages — to meet a crisis which it now seems was never going to happen anyway,” writes Mr. Booker.

It’s time to end this madness.

via Climate fraud – Pittsburgh Tribune-Review.

Hopefully, we can now move beyond this fraud, and get back to creating energy, unleashing business enterprise and reducing costs of energy for all Americans.

For anyone who thinks we’ll be pulling out of this recession anytime soon, you may want to think again. Even if we do pull out, it will more than likely be temporary. Unfortunately, the government is crowding out private investment by killing financing to the privates sector. George Melloan, author of “The Great Money Binge: Spending Our Way to Socialism” writes in the Wall Street Journal.

For anyone who wondered if last winter’s federal seizure of the financial services industry would have adverse economic consequences, an answer is now available. The credit market has been tilted to favor a single borrower with a huge appetite for money, Washington. Private borrowers, particularly small businesses, have been sent to the end of the queue.

The Federal Reserve, which supervises some 7,000 banks, has been telling bankers that they must cut risk. The most spectacular step in that effort was the Fed announcement last month that it will evaluate the salaries of bank officers on how carefully they manage risk.

By official definition, Treasury securities are risk-free, so how better to manage risk than to pad your bank’s portfolio with Treasury securities, which is what bankers are doing. Under the new management from Washington, bankers who take a flyer on a venture that might some day become an Apple, Microsoft or Google will risk not only their depositors’ money but a possible pay cut. Banking has been captured by the nanny state, which means that its potential for contributing to economic growth and job creation has been sharply curtailed, even as its potential contribution to government growth has been expanded.

The federally dictated risk-aversion was underway even before the Fed began monitoring banker paychecks. According to the Fed’s September flow of funds report, commercial banks were net buyers of Treasury securities to the tune of $25 billion on an annualized basis in the second quarter. They were net buyers of federal agency paper—think Fannie Mae and Freddie Mac—at an annualized rate of a whopping $185 billion, contributing mightily to federal efforts to keep these miscreants afloat. Meanwhile, private lending, which once was the mainstay of banking, was shrinking at a $392 billion annual rate.

Washington hasn’t been able to milk the taxpayers sufficiently to finance its massive deficit. The Chinese are getting skittish as well. So tapping bank deposits is yet another avenue to a big pot of cash. As for the bankers, they’ve been awarded an easy life. Thanks to the Fed’s zero interest-rate policy, they can make a decent profit on “safe” Treasury and agency securities yielding 3% or more. The too-big-to-fail banks like Citi and Bank of America can draw on their big shareholder, the U.S. Treasury, if their capital needs further supplements. Bankers don’t have to worry about making risk judgments because they’ve been ordered to not take risks. So maybe the Fed is justified in cutting their salaries, since whatever banking skills they had—meaning the ability to assess risk—are no longer needed or wanted. An office boy could buy government bonds.

via George Melloan: Government Deficits and Private Growth – WSJ.com.

Anyone who takes the time to analyze how the mortgage crisis started quickly realizes it was the result of the Fed printing money (the flood) and the congress passing affordable housing regulation to promote home ownership (steering the flood into real estate). What we ended up getting was an overvalued real estate market and a bubble that eventually popped and caused supposedly the worst crisis since the Great Depression. I would argue Obama is making this the worst crisis since the Great Depression, but none the less. So what does the government do? More of the same with their home buyer tax credits and cheap printed money from the Fed.

The problem is that the FHA insures mortgages of homes below certain price levels with such a low down payment that it can be funded solely by the refundable tax credit. And, as we’ve seen in the recent housing crisis, buyers with no skin in the game are more likely than others to default on their mortgages when the value of their home falls below their mortgage balance.

Here’s how the credit allows buyers to avoid putting their own money at risk. Suppose a couple making $60,000 annually buys a home worth $200,000. They can get an FHA-insured loan if they put down 3.5% of the purchase price, about $7,000. The couple will also need to come up with another $1,000 in closing costs, for a total of $8,000. The couple can either dip into savings or borrow that money from relatives or somewhere else on a temporary basis.

After closing, the couple can quickly obtain the $8,000 refundable tax credit to pay off their temporary loan (or replenish their savings). In effect, they will have bought a home without putting any of their own money at risk. Owners who don’t sink their own money into a house are much more likely to default on the mortgage.

The FHA already is facing a rising number of serious problems on its insured mortgages. Last week the agency reported that its cash reserves dropped to 0.53% of the $685 billion of total loans it insurers. This is well below the 2% federal law requires the FHA to have in reserves.

via Homebuyer Tax Credits Threaten the FHA – WSJ.com.

I won’t even get into the moral issue of what the government is doing by tricking people into buying homes they otherwise would not and forcing others to give up their earnings at a point of a gun so they can give it to home buyers. If the government would stay out of real estate, it would stabilize itself, and people would know the real value of their properties. Instead they are doing more of the same and inflating the value of real estate, creating more demand than there otherwise would be, and ultimately setting up another bubble in real estate. More than likely it won’t be as big of a bubble compared to the one we are recovering from, but none the less, it’s a bubble. Those who are buying under these programs are going to be in for a shock when the programs go away and values eventually move towards their market value. Then again, the Fed printed so much money that inflation may just increase the value of the homes. The problem is the rest of the economy will suffer.

In a seperate article the Journal talks about the disaster the rest of the housing market is in, so I’m sure they’ll keep tinkering.

The proportion of U.S. homeowners who owe more on their mortgages than the properties are worth has swelled to about 23%, threatening prospects for a sustained housing recovery.

Nearly 10.7 million households had negative equity in their homes in the third quarter, according to First American CoreLogic, a real-estate information company based in Santa Ana, Calif.

These so-called underwater mortgages pose a roadblock to a housing recovery because the properties are more likely to fall into bank foreclosure and get dumped into an already saturated market.

via 1 in 4 Borrowers Under Water – WSJ.com.

Ralph Reiland had a great piece in the Pittsburgh Tribune Review about Obama’s hypocrisy.

“We can’t drive our SUVs and eat as much as we want and keep our homes on 72 degrees at all times and then just expect that other countries are going to say OK,” he proclaimed. “That’s not leadership. That’s not going to happen.”

By Obama’s definition of U.S. “leadership,” we get a seat at the table with the world planners if we bow to their demands in terms of what we buy and how we live, if we downsize in accordance with their centralized planning, if we admit our gluttonous faults and send reparations for all the effluents and global warming that our materialistic successes have caused over the past century.

At the White House, however, it’s a different picture. Instead of guilt, global consciousness and keeping the thermostat at an Earth-friendly 60 degrees, it seems that Obama likes it hot at the executive mansion.

“The capital flew into a bit of a tizzy when, on his first full day in the White House, President Obama was photographed in the Oval Office without his suit jacket,” reported The New York Times on Jan. 29. “There was, however, a logical explanation: Mr. Obama, who hates the cold, had cranked up the thermostat.”

“He’s from Hawaii, OK?” explained Mr. Obama’s senior adviser, David Axelrod. “He likes it warm. You could grow orchids in there.”

Al Gore should calculate how many extra polar bears are likely to drown if Obama keeps it hot enough for four years to grow orchids in all 132 rooms of the White House, plus the 35 bathrooms.

It’s the same with food. We’re supposed to cut back while Obama is jetting in Wagyu steaks from Japan. The good stuff, the result of cattle bred for generations to be genetically predisposed to intense marbling, goes for $300 a pound.

via Doing & saying – Pittsburgh Tribune-Review.

And NO, I didn’t spell hypocrisy wrong in the title. Hypocracy is what we are living under. It’s a government full of hypocrites.

While the Democrats fight to take over our lives, at least we can count on the Republicans to fight for us?

On the Republican side, Mr. Reid must be relieved the GOP has apparently decided not to force a reading of the entire 2,074-page bill over the weekend. Instead, Republicans will settle for a full day of debate before the Saturday night vote.

Republicans had the option of staying on the floor and having Senator Tom Coburn of Oklahoma and others read the bill, a process that would take at least two days. They opted for a less strenuous path that will allow them to spend plenty of time at home during the Thanksgiving holiday. “Republican members oppose the bill, but they don’t appear willing to stay up nights arguing against it,” one former Hill staffer told me.

via Health Care Payola – WSJ.com.

Oops! Maybe not. Republicans are looking at this health care bill to gain political points only. Apparently, they don’t believe in fighting it enough to take the two days to read the bill. If they would have, the national media would have reported it, and it would have dragged the vote into the week, when people might actually be paying attention. Instead, they voted on Saturday just before 8PM, when most people are too busy trying to live and enjoy their time off work to pay attention to the jackasses in Washington. THANK A LOT REPUBLICANS. I guess there are no Mr. Smiths in the Republican party.