Posts tagged contributions
The Crisis is Not Over! A Conversation with Legendary Investor Jim Rogers
Published by Stefan Molyneux
Stefan Molyneux speaks with legendary investor Jim Rogers about the future of the world economy, the coming economic shift and how to prepare for the future.
Jim Rogers is an American businessman, investor and author. He is currently based in Singapore. Rogers is the Chairman of Rogers Holdings and Beeland Interests, Inc.
You can get “Street Smarts: Adventures on the Road and in the Markets” and other books by Jim Rogers at http://www.fdrurl.com/jimrogers
Get more from Stefan Molyneux and Freedomain Radio including books, podcasts and other info at: http://www.freedomainradio.com
By Hunter Lewis
Will Washington Take Down Apple — And Why?
Is Apple being given a hint to fork over more campaign contributions?
The US Department of Justice has not only successfully sued Apple for arguably non-existent anti-trust violations in the e-book market. It has even demanded– and gotten– a court appointed “monitor” placed inside the company to supervise the company’s pricing decisions.
This is a company that went from an $18 billion market value in 2000 to a $455 billion market value in 2013. During the same period, Microsoft’s market value fell from $603 billion to $290 billion. Should anyone expect the success story to continue now that the government is meddling with all the company’s pricing?
Apple appealed the anti-trust judgement this Tuesday, but was unable to get the government “monitor’s” work suspended while the case is under appeal. Among the interesting facts that have come out about the “monitor,” Michael Bromwich: he bills for his time at $1,100 an hour and charged $138,432 for his first two weeks of “work.”
Apple has labeled Bromwich’s appointment “unprecedented and unconstitutional.” We wish it were unprecedented. This form of government price interference and intimidation has become increasingly common.
Joseph Covington, who headed the Justice Department’s Foreign Corrupt Practices Act Division in the 1980’s, told Forbes, in reference to monitors appointed to enforce that act: “ This is good business for Justice Department lawyers who create the marketplace [ for monitors] and then get…a job there [ after they leave government].”
Nor is it limited to the Justice department. If a company gets into the sights of the Federal Trade Commission (FTC) or even the Food and Drug Administration (FDA), the terms of settlement increasingly include “monitoring” by highly paid lawyers, who are typically former FTC or FDA employees.
This is not just the small time corruption it might seem. It is tremendously damaging to the economy. The collapse of the Soviet Union should have demonstrated once and for all how important honest and unimpeded prices are for an economy.
If the government takes control of pricing, as it is doing in more and more sectors of the economy, it is guaranteeing unemployment and economic suffering. It is also guaranteeing an ever greater problem of crony capitalism, as companies respond by increasing their campaign contributions or take other steps to buy influence in Washington.
Apple is and ought to be ramping up its Washington presence. A Politico article of May 2012 wondered about the earlier naivete of the company leadership. Did they really think they could get away with lobbying expenditure of only $500,000 in the first quarter of that year compared to $5mm for Google and $1.8mm for Microsoft? Did they really think they could get away with having no company political action committee (PAC) from which to make campaign contributions?
Apple might have thought it was safe, even untouchable. Was not the company an icon of American economic leadership? Did not Apple employees overwhelmingly direct what campaign contributions they made to President Obama? Even with the lawsuit, had not Apple employees in fact given 93 percent of their contributions to Obama in 2012 and only 7% to Romney? Wasn’t that good enough?
Well no. Google employees gave 98 percent of their money to Obama and it was a whole lot more money ($727,702 versus $338,752). Apple CEO Tim Cook hadn’t even maxed out ( given to the legal limit) in his own contribution.
This lack of political involvement may be contrasted with Amazon’s Jeff Bezos, who stood on the other side of the anti-trust suit, even though he had created what certainly looked like a near monopoly in e-books, the subject of the suit. Apple is not wrong to argue in its legal filing that its entry into the sector “marked the beginning, not the end, of competition.” But Bezos has bought the Washington Post, and Washington officials will think twice about tangling with him.
In thinking about Apple’s relative lack of political involvement in the past, we should also keep in mind what Politico reported last month: “ President Barack Obama has a plan to save the Senate’s tenuous Democratic majority: sell a populist message… and raise lots of cash.”
In Washington doing favors for special interests is one way of raising cash. But so is intimidating them. Either way you get paid, whether from gratitude or fear.
In addition, there is another reason why Apple could now be in the crosshairs of the Justice Department. On November 5, 2013, the company issued a report containing this: “ Apple has never received an order under Section 215 of the USA Patriot Act. We would expect to challenge such an order if served on us.” This made jaws drop both in Silicon Valley and Washington. It was daring, perhaps foolhardy. It was directly taking on the government.
Before leaving the besieged Apple, we might pause to consider how the company also gives the lie to one of the great economic myths of our day: that falling prices ( deflation) hinder an economy. Here is a typical version of the myth from an AP story last month: “ Many economists have worried that the Eurozone may be about to suffer a debilitating bout of deflation….Falling prices can hurt an economy as consumers postpone spending in the hope of getting cheaper deals in the future while businesses fail to innovate and invest.”
This all backward. Businesses innovate and invest in order to become more productive. Being more productive allows them to lower prices, improve quality, and get more customers. Everyone benefits from lower prices, but especially the poor and the middle class, who have the most trouble dealing with rising prices.
Apple is a good illustration of all this. Various tech experts on the internet have been discussing what an Apple Iphone would have cost if available in 1991. What would we have had to pay to get similar features and power in some form ( clearly not hand held)? The estimates vary but the top one approaches $4mm.
Shouldn’t it be obvious ( to anyone other than a Federal Reserve official) that falling prices, produced by innovative and productive businesses such as Apple, are exactly what we should be hoping for? If so, why is the government determined both to create inflation and to interfere with Apple’s price setting decisions?
Image credit: http://www.againstcronycapitalism.org
About Hunter Lewis
Hunter Lewis is co-founder of AgainstCronyCapitalism.org. He is co-founder and former CEO of global investment firm Cambridge Associates, LLC and author of 8 books on moral philosophy, psychology, and economics, including the widely acclaimed Are the Rich Necessary? (“Highly provocative and highly pleasurable.”—New York Times) He has contributed to the New York Times, the Times of London, the Washington Post, and the Atlantic Monthly, as well as numerous websites such as Breitbart.com, Forbes.com, Fox.com, and RealClearMarkets.com. His most recent books are Crony Capitalism in America: 2008–2012, Free Prices Now! Fixing the Economy by Abolishing the Fed, and Where Keynes Went Wrong: And Why Governments Keep Creating Inflation, Bubbles, and Busts. He has served on boards and committees of fifteen leading not-for-profit organizations, including environmental, teaching, research, and cultural and global development organizations, as well as the World Bank.
Millions in tax payer dollars spent on tank no one (including the Army) wants
But it’s built in John Boehner’s district and the defense contractors are generous in their contributions to other members of Congress, so the outdated tank lives – on your dime.
Image credit: http://www.againstcronycapitalism.org
You want your tax break (or credit) extended? Better give to the right congresspeople
This is a nice little game (and revenue stream) for Congress. Tax breaks and tax credits come up for renewal every year and the beneficiaries of these favors cue up to throw campaign dollars and other gifts at the feet of Washington politicians – every year.
It’s crony capitalist genius. Why write something permanently into the code and only get paid once when Congress can turn political favors into a subscription service?
Remember the old adage. Never kill a sheep. Shear it over and over.
(From The Washington Free Beacon)
“If the past is prologue, some—but not all—of these provisions will be extended, but we will not know until much later in 2014 which ones will be extended, whether they will be extended with modifications, how long they will be extended, whether the extension will be retroactive and who will be stuck “paying” for any such extension,” they wrote. “Still, despite the history of on-again, off-again extensions, it is risky to assume that any particular provision will be extended simply because it has been extended in the past.”
Image credit: http://www.againstcronycapitalism.org
About Nick Sorrentino
Nick Sorrentino is the co-founder and editor of AgainstCronyCapitalism.org. A political and communications consultant with clients across the political spectrum, he lives just outside of Washington DC where he can keep an eye on Leviathan.
By: Peter Schiff
Monday, October 28, 2013
The Website is Fixable, Obamacare Isn’t
Since Obamacare made its debut, discussions have focused on Ted Cruz’ efforts to defund the law and the shockingly bad functionality of the Website itself. Fortunately for Obama, polling indicates that Senator Cruz has lost, at least for now, the battle for hearts and minds. The President has not been nearly so lucky on the technological front. If current trends continue, the rollout may go down as the worst major product launch in history. But given the government’s enormous resources, it’s safe to say that the site itself will ultimately be fixed. But when it is finally up and running, the plan’s many deeper, and more intractable, flaws will come into focus. That’s when the fun will really begin.
Put simply the program is built on a mountain of false assumptions and is covered by a terrain of unanticipated incentives. Any cleared-eyed observer should conclude that it is perfectly designed to raise the costs of care and wreck the federal budget. However, like just about every other complicated problem that bedevils the nation, the public has become far too caught up in the politics and has ignored the horrific details.
Most people agree that the plan can only remain solvent if enough young and healthy people (“the invincibles”) agree to sign up. They are the ones who are likely to pay more into the system than they take out. But now that insurance coverage is guaranteed to anyone at any time (at the same price — even after they have gotten sick or injured), the only incentive for the invincibles to sign up will be to avoid the penalty (I think we can dismiss “civic duty” as an effective motivator). But as I detailed in a column last year, Justice John Roberts declared the law to be constitutional only because the penalties are far too low to actually compel behavior. Once young healthy people understand that they can save money by dropping insurance, they will. No amount of slick, cheerful TV ads will change that.
The good news for Obama is that the plan will get a large percentage of young people covered. The bad news is that many of those that do sign up will not help the bottom line. The youngest and healthiest of the group are under 26 and will now be able to stay on their parents’ plans. This group will add nothing to the pool of premiums (but will use services). Among those older than 26, the ones who qualify for the largest subsidies will be more inclined to sign up. The way the plan is structured, individuals and families earning between 1.38 and 4 times the Federal poverty level will qualify for a subsidy. The government subsidy covers almost the entire premium for those near the bottom of that spectrum. These individuals will definitely sign up. But just like those under 26, they will be a net drain on the system.
From my estimations, private premium contributions don’t surpass the government contributions until an individual or a family makes about 2.5 times the poverty level (which equates to about $28,000 for an individual and $55,000 for a family of 4). Since a very large percentage of young people earn less than that, many will sign up to get the benefit. But these people will likely be net drains to the system as well. Their total premiums paid may be more than the services they receive, but that may not be true when you look only at what they actually pay in.
Young women, who plan on using maternity care, may also be motivated. But they can cost more than they bring in. The real cash cows are the young men, not covered by parents, who make more than 4 times the poverty level. But their only incentive to sign up is to avoid the penalty. But at just one percent of income, the penalty just won’t be a deciding factor. Most young men will save money by dropping insurance, paying the tax and incidental doctor visits out of pocket, and then only adding the insurance if and when something really bad happens.
The subsidies in Obamacare kick in and kick out very abruptly. People finding themselves on the wrong side of a dividing line will face difficult choices that hurt the plan’s finances. The San Francisco Chronicle recently profiled a California couple in their early 60s making about $64,000 per year who would be able to qualify for a $14,000 annual subsidy by reducing their income by $2,000 dollars per year. It’s easy to imagine such individuals reducing their hours or their pay to qualify. Of course this type of behavior modification has not been anticipated by preparing premium and budget projections. It is no accident that the government has offered no serious projections about how much in healthcare subsidies it should expect to pay out over the coming years
In truth, the premium levels themselves are based on nothing but assumptions. It is true that those lucky enough to actually get through the website’s technological maze have seen (unsubsidized) premiums that are lower than similarly constituted plans in the private market. But those low prices are only possible because no one knows what the new pool of insurance holders will look like. They assume it will look like the pools that already exist. But they won’t.
Of course, the incentives for the young and healthy to drop out, and for the sick, old and the heavily subsidized to drop in will mean that the post-Obamacare pool will have very different actuarial arithmetic than the current pools. But all of that is as yet unknown. The numbers we see now were put there just to make us feel good. But once the economics kicks in, look for them to rise quickly.
It is also ironic that high-deductible, catastrophic plans are precisely what young people should be buying in the first place. They are inexpensive because they provide coverage for unlikely, but expensive, events. Routine care is best paid for out-of-pocket by value conscious consumers. But Obamacare outlaws these plans, in favor of what amounts to prepaid medical treatment that shifts the cost of services to taxpayers. In such a system, patients have no incentive to contain costs. Since the biggest factor driving health care costs higher in the first place has been the over use of insurance that results from government-provided tax incentives, and the lack of cost accountability that results from a third-party payer system, Obamacare will bend the cost curve even higher. The fact that Obamacare does nothing to rein in costs while providing an open-ended insurance subsidy may be good news for hospitals and insurance companies, but it’s bad news for taxpayers, on whom this increased burden will ultimately fall.
The real shock of Obamacare is not the unbelievable ineptitude in which it was launched, but the naiveté in which it was designed. The only thing worse than the product launch may be the product itself. But unlike other major entitlements, like Social Security and Medicare, that took years to produce red ink that was far in excess of original assumptions, the financial shortfalls in Obamacare should show up very quickly. Republicans should not miss that opportunity to destroy this monster that threatens us all.
Peter Schiff is the CEO and Chief Global Strategist of Euro Pacific Capital, best-selling author and host of syndicated Peter Schiff Show.
Is justice finally actually being done on Wall Street? No, not really. It’s all party of the crony game.0
Is justice finally actually being done on Wall Street? No, not really. It’s all party of the crony game.
The government waited until after 2012 election to get maximum presidential campaign money out of these companies. Now however these trials 1) allow the government to get billions from the same companies, always useful for the government and 2) remind the same companies that their survival depends on their keeping up the campaign cash. Otherwise the statute of limitations would take effect and companies might stop giving
… while the details still make good reading, it’s hard to understand just what the justice-seeking purpose of such a prosecution might be. It’s more a theatrical representation of justice, akin to the trials of pigs for mauling small children. We can assume that the folks who tried and hanged “infanticidal swine” in the French towns of Trochon and Abbeville in the 15th century (that great phrase is from a 1906 monograph on the subject by Edward Payson Evans) also felt that when something so terrible has happened, some kind of trial has to be held. It doesn’t have anything to do with holding the perpetrators responsible — and certainly not with deterrence.
Image credit: http://www.againstcronycapitalism.org
Submitted by Donny Shaw
Senators Voting Yes on Syria Resolution Received 83% More Money From Defense Industry
The Senate Foreign Relations Committee voted 10-7 (1 member voted “Present”) yesterday to approve a resolution authorizing the use of military force in Syria. The resolution would allow the President to use the Armed Forces of the United States in Syria “as he determines to be necessary and appropriate in a limited and specified manner” for 60 days with an optional extension for another 30 days.
During the debate, Senator John McCain, R-Ariz., won support for two amendments. The resolution will have to be approved by the full Senate and House before it can be sent to President Obama for his approval.
Data: MapLight analysis of contributions from employees and PACs of defense contractors and other defense industry interests to current members of the Senate Foreign Relations Committee, from January 1, 2007—December 31, 2012. Contributions data source: OpenSecrets.org
- Senators voting to authorize the use of military force in Syria have received, on average, 83 percent more money from defense contractors and other defense interests than senators voting against the use of military force.
- Senators voting “YES” on authorization received, on average, $72,850 from the defense industry.
- Senators voting “NO” on authorization received, on average, $39,770 from the defense industry.
- Senator John McCain, R-Ariz., has received $176,300 from defense contractors and other defense interests, more than any other member of the committee. He voted “YES” on the resolution.
|Voting “No”||Party||State||Defense Industry Contributions||Voting “Yes”||Party||State||Defense Industry Contributions|
|John Barrasso||R||WY||$86,500||John McCain||R||AZ||$176,300|
|Marco Rubio||R||FL||$62,790||Dick Durbin||D||IL||$127,350|
|Chris Murphy||D||CT||$59,250||Timothy Kaine||D||VA||$101,025|
|Ron Johnson||R||WI||$19,250||Ben Cardin||D||MD||$80,550|
|Tom Udall||D||NM||$18,700||Bob Corker||R||TN||$70,850|
|Rand Paul||R||KY||$17,900||Bob Menéndez||D||NJ||$60,000|
|Jim Risch||R||ID||$14,000||Jeanne Shaheen||D||NH||$41,872|
|“No” Average||$39,770||“Yes” Average||$72,850|
|“No” Total||$278,390||“Yes” Total||$728,497|
Image credit: MapLight
Legalized Bribery — Interview with Ex-Lobbyist Jack Abramoff
Published by breakingtheset
Abby Martin talks with former lobbyist Jack Abramoff about DC’s culture of cronyism, revolving door politics, lobbying, and how to get money out of politics.
Well, I just found out that I would be wrong with that assumption. It seems Rep. José Serrano [D-NY15] has re-introduced H.J.Res 17 (112th Congress), a bill that died in committee, now as H.J.Res. 15. This House joint resolution calls for “Proposing an amendment to the Constitution of the United States to repeal the twenty-second article of amendment, thereby removing the limitation on the number of terms an individual may serve as President.”
For those interested in Rep. Serrano’s campaign contributions, below is partial information posted on OpenSecrets.org.
Top 5 Contributors, 2011-2012, Campaign Cmte
|American Federation of Teachers||$10,000||$0||$10,000|
|American Postal Workers Union||$10,000||$0||$10,000|
|National Assn of Realtors||$10,000||$0||$10,000|
|Operating Engineers Union||$10,000||$0||$10,000|
|Public Sector Unions||$57,500||$0||$57,500|
|Building Trade Unions||$17,500||$0||$17,500|
Information regarding key votes, recent public statements and issue positions can be found at http://votesmart.org, which states on their web site that “José Serrano refused to tell citizens where he stands on any of the issues addressed in the 2012 Political Courage Test, despite repeated requests from Vote Smart, national media, and prominent political leaders.”
The text of this bill is not yet currently available at the time of this post, but when available can be seen here: http://www.govtrack.us/congress/bills/113/hjres15/text
I do not know the intentions of a bill such as H.J.Res 15 by Rep. Serrano, which dictatorship may have nothing to do with, but see the possibility with the elimination of term limits. Give me your thoughts below.
Oppose this bill here… https://www.popvox.com/bills/us/113/hjres15
By Michelle Merlin
FOX News might be shying away from Dick Morris after he predicted a Romney presidency, but NewsMax, a conservative website for which he is a columnist, should be very happy with him.
Super PAC for America, for which Morris is the “chief strategist,” raised a little over $3 million from small donors in a little over a month, but only spent $1.5 million of that money on independent expenditures opposing Barack Obama.
Recent FEC filings covering Oct. 1 through Nov. 26 show that Super PAC for America disbursed $1.7 million to NewsMax for “fundraising.”
The super PAC had been fairly inactive for most of the year, raising less than $2,000 in the second and third quarters and making no independent expenditures during that time.
Thanks in part, no doubt, to Morris’ platform on FOX News and NewsMax Super PAC for America started pulling in small contributions in droves, raising $2.1 million in contributions of $200 and under — mostly in late October and the first few days of November. The group received 3,446 contributions larger than $200, but none exceeded five digits.
Relying on small donors is an unusual strategy for a super PAC, which has the advantage of accepting limitless contributions.
Complicating the picture are the relationships between the super PAC, Newsmax, Morris and a nonprofit that gave money to Super PAC for America before it was refunded.
In January, the super PAC received a $500,000 contribution from The League of American Voters, a 501(c) group that frequently advertises on NewsMax. The League is sometimes promoted by Morris in his columns, as in this one in 2009, which urged readers to send it money to fight Obama’s health plan. Morris says in the column that he’s “affiliated” with the group but has no financial relationship with it.