Politics

I've had it with this sort of half-assed response to terrorism:

Air Canada said in a statement that new rules imposed by the Transportation Security Administration limit on-board activities by passengers and crew in U.S. airspace. The airline said that during the final hour of flight passengers must remain seated. They won't be allowed access to carryon baggage or to have any items on their laps.

Flight attendants on some domestic flights are informing passengers of similar rules. Passengers on a flight from New York to Tampa Saturday morning were also told they must remain in their seats and couldn't have items in their laps, including laptops and pillows.

Let me make myself clear: I am very interested in not being blown to smithereens by some Islamic Nutjob who believes his personal path to a bunch of virgins lies in killing "infidels."

But let me also be very clear: It is not little grandmas, 40 year old white businesspeople, or families with a couple of young kids (all of whom have the same, non-muslim or arabic last name) that have or are attempting to blow up airliners.

In this case said nutjob recently visited a place known to be a terrorist hotbed, we knew he was there, and even more damning, the NSA knew he was on the plane before it entered American airspace - yet that flight was permitted to proceed all the way to Detroit where he tried to set off his device (and it failed to detonate, most likely because he was tackled by another passenger, thank the Christian God!)

Even better, this jackass' name is "Umar Farouk Abdulmutallab".  Is that your first clue that there's a materially higher risk that he's a terrorist than, say, "Sam Smith"?

The American people have been subjected to outrageous and insane restrictions and inconvenience with regards to air travel since 9/11, all in the name of "improving security."

Let me remind everyone of the following facts, lest anyone forget:

• The terrorists of 9/11 were in the United States for a long period of time before they launched their murder spree.  They were in fact taking flight lessons but refused to learn how to land, which prompted a report of suspicion from the flight school.  These nutballs then overstayed their visas which was plenty-sufficient reason to deny allowing them to board any aircraft and in fact was sufficient to arrest them at security in the airport and deport them.  Had we done so the 9/11 attacks would have failed.
  
  
• The terrorists of 9/11 did not take any prohibited item onto an aircraft.  Box cutters were not prohibited items prior to 9/11 - short-bladed knives were considered acceptable in the cabin.  We simply did not (as a collective consciousness) think of an aircraft as a potential bomb, and therefore did not foresee someone trying to hijack one as a means to acquire a bomb.
  
  
• Flight 93 on 9/11 is proof positive (as is this incident) that once Americans understood what was going on they were both willing and able to rise to the occasion and stop the terrorists.  It would be even better if we could carry on board aircraft as civilians, but I understand the concern over bullets penetrating things that could cause the aircraft to crash.  However, no such reasonable expectation of aircraft damage is associated with Tasers - so why can't a law-abiding citizen carry one on board?  Had the citizens on 9/11 been armed with Tasers (even a few) "Sir Boxcutter" would have met his twitchy demise in short order instead of being able to carry out his plan.
  
  
• ALL recent terrorist activity targeted against The United States has been Islamic.  Argue with that if you'd like.  Tim McVeigh is the last reasonable incantation of "non-Islamic" terrorism you will find.  9/11, attacks over in Europe (e.g. Madrid, etc), Mr. Shoebomber, Ft. Hood and now this - all Islamic Terrorism.

What has been our response?

1. We have refused to profile even though the threat is clearly, at this time, subject to profiling.  While profiling wouldn't stop every attempt, it sure would have stopped this nutball!  Been to Yemen of late have you?  You ain't getting on the plane.  You have a Muslim name? You get the "special" security screening.  You don't like it?  Tough crap - we'll stop being selective when the muzzies stop trying to blow up our airliners and people!
   
   
2. We have severely inconvenienced travelers without doing one thing to actually address the problem.  Again, the simple fact of the matter is that changing the prohibited item list all on its own would have prevented 9/11 from succeeding.  Instead of a 30-second change by the FAA to the rules we built another bumbling federal bureaucrazy. (Yes, I spelled it that way on purpose.)
   
   
3. We call the TSA "security" but we refuse to make them legally responsible for the luggage they allegedly have control over from the time we check it until it is on the carousel.  Theft from luggage remains a problem and the TSA is explicitly exempted from financial responsibility.  Why?  If someone can steal something from your bag, they can also put a bomb IN YOUR BAG!  The latter makes you (and everyone else on the plane) dead.  Why do we accept this half-ass claim of "security" when it is not backed up by financial responsibility - that what is in your bag when you check it will still be there when you retrieve it?
   
   
4. I don't particularly mind taking my shoes off so they can go through the scanner, nor having some TSA dude see my computer turn on (so he knows it's an actual computer) nor do I care if they throw all my carry-on crap through the scanner as well.  Letting them see that there's nothing that goes "boom" in my bag (or more importantly, the bag of the guy who I don't know sitting next to me!) suits me just fine.  But if the TSA is so good at this and so are foreign security checkpoints how is it that this jackass got on a plane with a bomb in his possession?

Now that the TSA and its foreign counterparts have proved they are clearly unable to stop someone from getting on a plane with both a bomb and the means to set it off we're being told that we must "remain seated for the last hour of flight" and that we "can't have access to carry-ons."

Of course you've never been on a flight where the "last hour" is in fact the entire flight less climb-out, right?  Let me clue you in - if you fly from the East Coast to anywhere east of the Mississippi, your flight time - actual in air time - is likely under two hours, and about 10-15 minutes of that is climb-out - that is, before the "seat belt sign" goes off.

Nor have you ever had a "last hour" that was three hours, have you?  I have - more than once.  Indeed, I was once on a flight into Detroit that was literally turned around and returned to the point of origin, allegedly due to "conditions", even though I later discovered that Detroit Metro airport was open at the time and accepting flights.  That "last hour" turned into four, and it was entirely because the prior delay in departure (for which I sat on the tarmac waiting - two more hours!) meant that the airline didn't want the equipment in Detroit.  That's the only reason they turned around.

I won't even get started on the games airlines play with government approval, where "on time departure" means the jetway was cranked back and the aircraft left the gate.  This is why they strand you on the runway with nothing to eat or drink, forcing you to sit in your seat with no access to the bathroom for hours.  It is all about the possibility of being penalized for "late" flights - anathema.  Don't believe for a second the "three hour" rule just adopted will change things materially - is three hours sitting in a tin can with no A/C, food, beverages or access to the can (say much less your carry-ons that might include a book, music player or laptop) "ok" with you?  It's not ok with me.

What this means is that if you brought your laptop to do some work, forget it.  If you want to listen to your iPOD, forget it.  If you want to read a book, forget it - that's a carry on item too.

Further, let's not forget that the Islamic Terrorist who tried to blow up this plane allegedly hid the bomb in his underwear.  That's not a "carry on item", so exactly what does preventing people from getting up to go to the bathroom or using their laptop have to do with preventing someone from setting off a device sewn into their skivvies?

What's next - handcuffs and leg irons at each seat and/or strip-searches for all?

I'll give you my answer to this crap:  Screw that and screw the airlines.

I don't have to fly.  You don't have to fly.  Nobody has to fly except for government bureaucrats, and they're welcome to put up with all the crap that we shouldn't and I won't.

I had planned a nice vacation this summer that, surprise surprise, included giving some of my hard-earned money to the airlines.

NOT ANY MORE.

I have tolerated the insane changes in rules that demand I be at the airport more than an hour before departure for domestic flights and two hours for international, simply because the TSA can't manage to run checkpoints efficiently nor put in enough people and machines to keep the line from snaking out the goddamn door.  There is no reason for there to be ANY wait for security screening - the TSA knows how many counters are open at check-in, and they COULD have enough lines and agents to screen everyone with no more than "X" (a small number, say three or four) people in queue for each line - maximum.

I have tolerated my luggage being pillaged (literally) and then being told by the TSA that "they're not responsible" even though the pillage clearly happened while the bag was in their so-called "sterile area" - all the while wondering if the jackass who stole my (expensive electric) razor and a couple of CDs stuck a bomb in someone else's bag while they were at it.

I have tolerated the TSA goons telling me that I can't bring a goddamn tube of toothpaste with me in an overnight bag because it is slightly over 3oz, never mind that I'm perfectly happy to demonstrate by eating some of it that it is indeed toothpaste and is of a particular type that I use on recommendation of my dentist.  Never mind the sealed, unopened 12oz can of Dr. Pepper that I can't bring through security so as to avoid being bent over the table for $4 to buy the same thing 20 feet beyond the scanner.  Guess where I was flying that day?  To assist the NY Attorney General, at their request and without charge.  Do you think that abusing those who are willing to take a couple of days out of their personal and professional life to help law enforcement catch bad guys and put them in prison will encourage people to do that in the future?

Never mind the obvious - 3oz (by volume) is more than enough to make a big bang if something bad is in there.  The TSA justifies this of course on the premise that "well we had to balance things out."

I strongly suggest that every American refuse to patronize the goon squad until we do the right thing - that is, profile, staff checkpoints appropriately so there are no obscene waits, make the TSA legally responsible for the contents of luggage in their care and make unlawful the detention of passengers on the ground in an aircraft for longer than is reasonably necessary for that plane to taxi from the gate to the threshold, wait for a couple of planes to depart in front of it, and take off.  That is, force the airlines to not close the door and push back a plane until that flight has a take-off slot on an actual runway within the next 15 minutes.

In the 1980s I flew on People's Express Airlines.  You want to know what "hassle free" air travel was like?  Let me tell you how it worked:

• You showed up at the airport.
  
  
• You got on the plane.
  
  
• You paid on the aircraft.
  
  
• You got off at your destination.

It was a freaking city bus that happened to go a thousand miles or more between stops, and it worked.  Yeah, I know the business failed, but let me tell you - that was hassle-free air travel.

I have tolerated the gradual erosion of what was an enjoyable experience for more than twenty years.

My limit of tolerance has been reached, and I believe yours should be as well.

Vote NO with your wallet.

PS: If you're wondering what PETN, the explosive that allegedly this guy and Richard Reid tried to use will do, here's an example from Youtube.  This is supposedly 50 grams of the stuff - less than two ounces - taped to a tree.  Still think that 3oz "liquid or gel" restriction is all about safety eh?  Still think this was a "firecracker"?  Uh, no.

John McCain may be searching for redemption here....

Dec. 16 (Bloomberg) -- U.S. Senators John McCain and Maria Cantwell proposed reinstating the Depression-era Glass-Steagall Act that split commercial and investment banking to rein in Wall Street firms in response to the financial crisis.

“Under our proposal, too-big-to-fail banks would be forced to return to the business of conventional banking, leaving the task of risk taking or management to others,” McCain, an Arizona Republican, said at a Washington news conference. A former bank regulator said splitting up companies is “crazy.”

I will reiterate what I said back in the summer and fall of 2008: I am absolutely convinced that McCain's endorsement of the TARP bailout bill, and his refusal to stand up and take a strong position in favor of the common man, is why he lost the election.

Reinstating Glass-Steagall would be a near-total reversal of his previous position.  It would be recognition of the facts: Banks that are allowed to gamble in the financial markets inherently are gambling with the sovereign credit of The United States, and inevitably transfer their losses to the taxpayer while keeping ALL of the profits for their overpriced staff and executives.

This is often said to be of "benefit" to the public because these banks are public companies.  This is a flat lie: Goldman typically bonuses out roughly half of their gross profits, with only a minuscule piece being paid in dividends to shareholders.  Other banks have similar compensation policies.

There is no "free market" way to prevent such distribution.  You can only prevent it by prohibiting lending and/or depository institutions from speculating in any form or fashion in the markets.

For those firms that wish to speculate they should be free to - with their own funds (that of their shareholders or bondholders) but they must be accountable to the last penny for each dollar at risk, and unable to transfer that risk to the taxpayer.

Wall Street will, of course, fight any such law tooth and nail, because speculating with other people's money and being able to force the taxpayer to eat all risks of loss is the time-honored fashion by which these institutions steal hundreds of billions of dollars from taxpayers each and every year.

This has ratcheted up the government's obligations to the point that there is a very real risk the government may be unable to meet its obligations.  That, of course, would be an unmitigated disaster and quite literally could result in the end of our Republic.

The truth is right here:

“We cruise along for 80 years without a major calamity infecting the entire financial system and then less than eight years after the repeal of Glass-Steagall we have a financial meltdown in this country,” Camden Fine, president of the Washington-based trade group for about 5,000 smaller U.S. banks, said in a telephone interview. “That’s no accident.”

Exactly. 

NOW CUT THAT CRAP OUT.

If John McCain has finally thrown his "trusted economic advisor" Phil Gramm (of Gramm-Leach-Bliley fame, which repealed the last pieces of Glass-Steagall, and who proclaimed that we were in a "mental recession" during the campaign) over the side of the boat with cement shoes attached it is long overdue.  If he truly is willing to get behind and press this bill through the Senate and raise hell - in public if necessary - to get it passed, I will take back all the ugly things I said about him during the 2008 campaign, and should he run in 2012, I would be likely to vote for him as well.

John McCain can demonstrate he's serious about REAL financial reform and not just bloviating by joining - and rallying others to join - a block on Bernanke's confirmation for a second term.

What sort of BS is this?

The Internal Revenue Service on Friday issued an exception to long-standing tax rules for the benefit of Citigroup and a few other companies partially owned by the government. As a result, Citigroup will be allowed to retain billions of dollars worth of tax breaks that otherwise would decline in value when the government sells its stake to private investors.

What?

How much?

The "exemptions" are on roughly $38 billion in "future earnings."  The actual value of this exemption could be anywhere between zero (if Citi makes no profit) to roughly 40% of the whole, or $15 billion.

Obama was touting the "profits" made by Treasury on the TARP repayments.  What he wasn't saying is that not only did we flush the money (from TARP) that went into Chrysler (disclosed last night), we now find out that at the same time he was "touting" the so-called "profits" The President was handing that money straight back to the bailed-out companies via tax breaks!

So no, Mr. President, Treasury (and The American People by extension) did not "make a profit" on TARP, nor "will we recover every penny" that was paid out.

There have been several banks that have failed after receiving TARP money - we will get zero from them.  We will get zero from Chrysler and GM.  We lost 100% of the money injected into CIT, and now you have handed out billions of tax credits to Citibank.

Where's the so-called "populism" - that is, the protection of "the little guy" while making those who were responsible for this economic mess pay for their sins Mr. President?

If you're a Democrat and believe that you were electing "Hope and Change", you might want to think about what you actually bought with your vote - not what you were sold.

Leaders are considering a hike of roughly $300 billion to the nation's $12.1 trillion deficit, though the final figure has not been nailed down, congressional aides said on condition of anonymity.

Democratic leaders had previously hoped to raise the limit by at least $1.8 trillion, enough to take care of the government's debt needs through the November 2010 congressional elections.

What was your first hint the former $1.8 trillion increase attempt was a bad idea?  Perhaps this?

Or was it China buying a literal zero of Treasury debt in October?

Or was it the TIC report this morning (which I'm sure you had "early") that showed a near-zero appetite for foreign funding of our idiotic spending proclivities?

Or was it the fact that this morning PPI numbers came in hot, especially in crude goods, strongly implying that we're in for a nasty bout of either cost-push price inflation or collapsing corporate profits?

Perhaps it is the numerous anecdotes of "seasonal help" already being laid off, stacks of "Black Friday" merchandise still in the stores, and Best Buy's earnings report this morning in which they disclosed margin compression in the 4th quarter - which promptly hammered their stock for 7.2%.

None of this should be a surprise.

We have fixed nothing in the last two years.  We have not forced bad debt to default yet worse, despite the incessant pumping and attempted "forcing" of credit into the system via government borrowing the pump has now officially failed, as the new Z1 data shows.

Note that despite all the Federal Deficit spending - $1.4 trillion last fiscal year (ending in September) and $300 billion more in the last two months - approaching two trillion dollars - the total credit outstanding in the system - including the new Federal borrowing - went negative in the third quarter of this year.

The bottom line:

Your attempt to play "pump prime" over the last two years has FAILED. 

For the first time in the modern era you have run into the mathematical realities of too much debt for the amount of payment capacity in the private sector.

You can either stop now, or you can stop when the government's ability to borrow is cut off forcibly by radical increases in the bond interest-rate curve. 

You WILL stop gentlemen.  The only question remaining is whether it will be voluntary or whether the market will force an involuntary cessation of Treasury Coupon issuance.

Attempting to avoid this by monetizing debt, as Bernanke has done while being your handmaiden (while lying about his actions to The American People AND in sworn testimony before Congress) forced currency devaluation which in turn (as expected) cuts off foreign debt demand.

That in turn, as you are now seeing, causes the coupon increase to happen anyway.

You're trapped folks, exactly as I predicted you would be two years ago.

I stand impressed that you got away with this for as long as you did, but I also stand behind the view I expressed in 2007 - that the root problem is an excessive level of debt in the system at all levels, a level of debt that exceeds capacity to pay, and as a consequence any and all attempts to restart the credit-driven consumption economy would fail, and if pressed too far the government will fail.

The evidence strongly suggests that you are getting awfully close to your last chance to stop being stupid before the market hands you a lesson that has the potential to destroy both our economy and government.

You would do well to listen.

It may be "politics as usual" to never talk about how bad the economy really is - never talk about the budget deficit in honest terms - and never talk about how revenues are and have been cratering across the board for governments.

But when you are facing a truly horrific situation in this regard, and you need everyone on board to make sacrifices - especially government positions where employees feel especially entitled - "politics as usual" is particularly dangerous.

This weekend Ireland's largest public sector union has called the situation "explosive":