Feed the Pig

Cash for clunkers had two objectives: help the environment by increasing fuel efficiency, and boost car sales to help Detroit and the economy. It achieved neither. According to Hudson Institute economist Irwin Stelzer, at best “the reduction in gasoline consumption will cut our oil consumption by 0.2 percent per year, or less than a single day’s gasoline use.” Burton Abrams and George Parsons of the University of Delaware added up the total benefits from reduced gas consumption, environmental improvements and the benefit to car buyers and companies, minus the overall cost of cash for clunkers, and found a net cost of roughly $2,000 per vehicle. Rather than stimulating the economy, the program made the nation as a whole $1.4 billion poorer.

As the journalist Henry Hazlitt wrote in his classic, “Economics in One Lesson,” you can’t raise living standards by breaking windows so some people can get jobs repairing them”.

And boy does Obama and Company love to break those windows. Or is that “saved or created” those windows.

The unemployment rate rose to 9.8 percent in September, the highest since June 1983, as employers cut far more jobs than expected.

The report shows that the worst recession since the 1930s is still inflicting widespread pain and underscores one of the biggest threats to the nascent economic recovery: that consumers, worried about job losses and stagnant wages, will restrain spending. Consumer spending accounts for about 70 percent of the nation’s economy.

And some analysts expect that it will grow to 10.5%.

And gee, I thought the stimulus package was only supposed to make it go as high as 8%. And the Health Care bills will cost less than $900 billion… and save us all from ruin!

Trust us.

And, of course, the Media is entirely “fair” and unbiased….

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This does, however, provide an excuse to highlight an interesting new report by the Business and Media Institute, a free-market think tank. The institute’s Julia Seymour undertook what sounds like a tedious task: comparing TV network news coverage of unemployment during the Reagan recession and the Obama one:

The Business & Media Institute analyzed network unemployment stories on the evenings that data was released by the Bureau of Labor Statistics between March 2009 to September 2009 and March 1982 to September 1982. There were 66 stories in all–35 stories in 2009 and 31 stories in 1982.

The findings are similar to our anecdotal observations of the AP’s reporting prior to today. The networks “were 13 times more negative in their treatment of Reagan than Obama.” Twenty of 22 stories mentioning the Reagan administration portrayed it negatively, versus 1 out of 15 that mentioned the Obama administration. Most telling is the comparison of how the nets–and, in one case, the same newsman–treated identical unemployment rates during the two recessions:

But Charles Gibson illustrated how dramatically different the network coverage of Reagan and Obama really were.

Gibson, who was a Capitol Hill correspondent for ABC in 1982, told viewers May 7, 1982, “There really isn’t any good news in the statistics. All the numbers are bad.” He then quoted two Democratic attacks on Reagan including Rep. Henry S. Reuss, D-Wis., who charged that Reagan’s “policies aren’t just mistaken, they’re wicked.”

But as an ABC anchor in 2009, Gibson was full of hope. He introduced that night’s story saying “sometimes a bad jobs report can look good.”

“345,000 Americans lost their jobs in May, a big number to be sure. Traumatic if you are one of the 345,000. But the number was smaller than economists had predicted, and that’s good news,” Gibson said before admitting that the unemployment rate of 9.4 percent was “pretty bad.” Neither Gibson, nor reporter Betsy Stark mentioned President Obama at all that night.

On Aug. 7, 2009, Gibson suggested “the economy may be finally turning the corner.”

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So what if the unemployment is rising, it’s not as bad as it was and it could have been worse.

But in 1982, the world was coming to an end as we know it.

And it was all George W Bush’s Fault.

Yep, that’s your Ministry of Truth for you.

As for the economy — mixing things up for members of Congress, with a little deception: “The Treasury Department and the Federal Reserve lied to the American public last fall when they said that the first nine banks to receive government bailout funds were healthy, a government watchdog states in a new report released today,” ABC’s Matthew Jaffe reports. “Neil Barofsky, the special inspector general for the Troubled Asset Relief Program (SIGTARP), says that despite multiple statements on Oct. 14 of last year that these nine banks were healthy and only receiving government funds for the good of the country’s economy, federal officials knew otherwise.”

Reporting from Washington – The Treasury is unlikely to get back the full amount of money lent under the Troubled Asset Relief Program despite a recent spate of repayments from large banks, warned the program’s watchdog.

The program “played a significant role” in rescuing the financial system from a meltdown, Neil Barofsky, special inspector general for TARP, testified before the Senate Banking Committee on Thursday. But it was “extremely unlikely that the taxpayer will see a full return on its TARP investment,” according to his prepared testimony.

Losing some money was almost inevitable, said William Goetzmann, a finance professor at the Yale School of Management.

“The intent of TARP investment was not that it was a great investment for the U.S. taxpayer,” Goetzmann said. “The intent was to save the U.S. financial system, and that was going to cost some money.”

Juxtapose that with:

When President Obama announced on June 9 that some financial institutions would be allowed to repay Troubled Asset Relief Program dollars, he said the massively expensive TARP bailout had made money for the federal government.  “It is worth noting that in the first round of repayments from these [TARP recipients], the government has actually turned a profit,” the president said.

So if we have no hope of getting all the money back, how is that we turned a profit exactly??

Is that like, “we’re bankrupt” so lets spend trillions more?

No, the government was handed stocks in the banks they lent the money to. They became shareholders.

Last month, the General Accountability Office (GAO) reported that, through June 12, 2009, the government had received $6.2 billion in dividend payments.

But will then make for the losses. Unlikely. Since many of the banks who were supposed to pay those dividends, didn’t.

Indeed, in its June report, the GAO revealed that 17 troubled institutions have not paid their dividends, much less repaid the TARP money itself.  And last week, the Wall Street Journal reported that three other institutions were not paying dividends.

Shocking, I know…

So yet another government program loses money.

But don’t worry, Health Care Reform will cut the deficit!

And won’t cost “not one dime”!!!

Oh, and Rep. Barney Frank wanted to spend this 6.2 billion right out of the shoot on more subsidies.

“We don’t know if TARP is going to be making any money, so taking the dividend payments going back to Treasury is pretty questionable,” says one House GOP aide.  But now, Frank is proposing that dividends be spent immediately.

So, don’t worry, they are fiscally responsible with your money.

That’s why they have so many taxes coming down your throat soon.

They need more to spend!!