I May Make You Feel

“People are defining their politics not by positive thoughtful principles, which requires thinking and can be difficult, but rather by how much they hate the other side, which is simple and requires only outrage.” – Dennis Prager

This statement is true for the Trumpsters and the anti-Trump folks. However there is a major difference – the eight years of Obama brought the greatest wealth transfer in history, a transfer of net wealth from the bottom 93% to the top 7%. Billionaires on average doubled their net wealth during the eight years of Obama and billionaires are funding the agitation against Trump. For every Leftist example of the (libertarian) Koch brothers there are ten examples of billionaires funding the Left. Billionaires fund the Left because they grow wealthier from the policies of the Left while the majority lose.

It is the same story the world over. If you really want to look at something funny, look at how Bernie Sanders has had to rotate his examples of ‘successful socialism’ around the world: the Soviet Union, Cuba, Nicaragua, Venezuela, and his latest example of Denmark. Sanders changes his examples because each example of ‘successful socialism’ eventually becomes a hell hole of misery where the very wealthy have all of the wealth. I would be very worried if I was Danish.

Quick observation: I find it beyond fascinating that Sanders latest favorite example is a monarchy – has the United States come full circle from 1776?

“If socialist understood economics they would not be socialist.” – Hayek

The last thing these billionaires want their minions to do is think. The billionaires are quite adept at feeding the Lefts individual belief in themselves as the superior species – and to the insecure and socially needy this is worth more than gold. Having a bogeyman to attribute all of the difficulties in life to is quite convenient – and those billionaires who can pull strings in the media and that are willing to spend considerable sums of money to keep the massage of ego’s and reaffirmation of self-worth based on Leftist groupthink going is of considerable value to these folks. Feeling good matters more than actually doing right.

That is not to say that Trump is all that and a bag of chips – his policies range from the courageous to the absurd. Most telling, Trump has been adamantly unwilling to deal with the lethal threats to the future of the United States – entitlements and monetary policy. In other words what can really kill us he is unwilling to address. Not that Obama or W or Clinton were willing do that either – they were not.

There is a lyric from an old Jethro Tull song, “I may make you feel but I can’t make you think.” I try very hard to encourage people to think and it is always a much shallower slope to get people to feel.

In the end we get the government we deserve…

The Judiciary’s Coup Attempt Against American Voters Continues

Millions of Americans hoped the 2016 election would bring major changes to the federal government. Hundreds of judges have a different idea. Earlier this month, the DC Circuit Court of Appeals issued a lawless ruling attempting to deny Donald Trump the powers of the office America elected him to. Specifically, the court ruled EPA Administrator Scott Pruitt may not issue a 90-day pause to evaluate a controversial and costly new environmental regulation adopted in the waning days of the Obama Administration. Pruitt had announced EPA would pause to reconsider a new rule that greatly restricts methane gas emissions from well sites.
The decision involves complex regulatory issues that are not easy to summarize for public discussion. But, the position the court staked out, the power to intervene it claimed, and the executive authority it denied, are audacious and abusive. They send troubling signals about courts’ willingness to block other efforts of the Trump administration to reconsider policies adopted by the Obama administration.
It happened like this. In August of 2016, EPA Administrator Gina McCarthy adopted a sweeping new rule sharply reducing allowable methane gas emissions from well sites and imposing enormous upfront compliance costs on energy producers. The final rule was different from the preliminary version that had been released for public comment, containing new, unvetted terms and restrictions. A coalition of industry groups challenged the final rule, arguing among other things that the Clean Air Act requires the Administrator to reconsider issuing a rule if challengers raise objections and show that it would have been impractical to raise those objections during the allowed comment period.
Because the challengers focused on the new provisions that weren’t submitted for comment, their argument was, to use a legal term, a slam dunk. Pruitt agreed the Clean Air Act required him to take a second look. Last June, Pruitt announced EPA would reconsider the new methane rule and stay enforcement for 90 days so well operators would not have to sink compliance costs pending a final decision.
Promptly, a coalition of environmental groups sued the EPA, arguing the Clean Air Act did not require reconsideration, and therefore, Pruitt lacked flexibility to pause enforcement for 90 days.
The government and the challenging energy producers responded to the lawsuit with a range of decisive arguments that should have, but did not, persuade a 2-1 majority of the DC panel. Judges David Tatel and Robert Wilkins–Clinton and Obama appointees, respectively, with Wilkins seated by virtue of Harry Reid’s nuclear maneuver–found against the EPA, ruling it lacked power to delay enforcement. The EPA made the following arguments, which were lost on the DC Circuit:
First, courts have no jurisdiction to hear or act on preliminary actions. They can review only final agency actions. This is a firmly established principle for the common sense reason that litigants and courts can’t intervene speculatively into what an agency might do, what it could do, what it is thinking of doing, but only what it actually decides to do. Proposals, deliberations, suggested drafts, none of these things decide or bind anyone’s rights or duties. Only final adopted policy can be challenged. The court has no jurisdiction here. It’s essentially the same obvious principle citizens can’t sue Congress for a law that it hasn’t yet passed. Only after the final vote is the matter teed up for action.
Second, EPA doesn’t need a statutory mandate to set internal enforcement priorities. This kind of review and pause is inherent in executive authority to choose to pursue some policies ahead of others. Pruitt didn’t have to wait to be challenged, and act only by virtue of a statute that compelled him to reconsider the rule. He could, simply as a matter of exercising agency power, announce he was going to eyeball this new regulation and hold off imposing a new mandate until he finished the review.
Third, if Pruitt did in fact need a statutory basis for his action, the Clean Air Act plainly provides it. The energy producers sought reconsideration and pause because they had been denied the chance to comment on the newly inserted provisions. If citizens weren’t allowed to weigh in on material terms, the law requires reconsideration.
Or, it is supposed to. In 22 pages of judicial cartwheels and somersaults that have to be slogged through to be appreciated, the majority threw law and reason out the window. First the panel admitted that a decision to reconsider was tentative rather than final, because it might not produce any changes to the rule. So, the panel then narrowed its focus to the related 90-day pause in enforcement. Perhaps just talking about the rule might not cause any changes, but, the pause was, in its own small way a final action. This is so, the court said, because it amounted to a change of the rule’s effective date and when compliance obligations were triggered. And that was final.
Dissenting Bush appointee Janice Rogers Brown demolished this sophistry in one line: “Hitting the pause button,” she noted “is the antithesis of ending the matter.”
Having pulled a “final action” out of their robes which they claimed granted them jurisdiction, the panel pressed on to review the pause. Surely, the government argued, the delay was part of its inherent authority, or even stronger than that, it was mandated by the Clean Air Act because it was to consider the impact of late-added provisions to the rule.
No, the panel concluded, reconsideration was not actually mandatory under the statute. The final provisions weren’t so different from the preliminary terms that were released for public comment. In fact, the first draft kind of hinted at some of the surprises. The parties could and should have anticipated what changes EPA would make, and address them in their initial comments.
So, the unhappy energy companies dropped the ball by not raising the new issues and EPA was therefore not required to reconsider. The panel further unreasoned that, even if reconsideration is an inherent power of an agency, the brief delay in enforcement is not. Presto, Pruitt was powerless not to press full speed with enforcement.
This lawless ruling is a rotten result for consumers, the affected energy producers, and an ominous omen for Constitutional peace in the nation. As far as the affected parties, energy companies are now in the limbo of knowing the EPA can “reconsider” the new rule, but they face deadlines to purchase and install costly monitoring and capture equipment. The upfront costs substantially moot reconsideration by EPA.
For the nation, it signals further willingness by Democrat-appointed judges to join The Resistance and fight to tie Trump’s hands by any means possible. The new administration is studying several disputed actions by the Obama administration including an FCC power grab over the internet, new education regulations, labor regulations and more. There will be legal challenges to any such reconsideration. But, what Obama can impose by a pen and a phone, logically, Trump has authority to reverse by a pen and a phone.
The last time this happened, two Circuit Courts blocked Trump’s immigration order, saying even though it was facially valid, statements by candidate Trump cast a pall on its real intent. The Supreme Court summarily smacked their obstruction down. This latest power grab raises different legal issues but signals the same thing: Unless slapped by the High Court, lower federal courts will contort any way possible to protect Obama’s initiatives and to block Trump’s.

Morning Reading

A few articles you may have missed this week that are worth your time –

Grant Williams penned “Passive Regression” on the rise of passive investing and the dangers inherent.

Evelyn Chang compared the bitcoin bubble to tulip mania.

David Stockman wrote “The Imperial City’s Fiscal Waterloo” – “The stand by Senators Lee and Moran was much bigger than putting the latest iteration of McConnell-Care out of its misery. The move rang the bell loud and clear that the Imperial City has become fiscally ungovernable. That means there is a chamber of horrors coming. With it, an endless political and fiscal crisis that will dominate Washington for years to come. Its cause is deep and structural.”

George Friedman contributed “Russia’s Strategy: Built on Illusion.”

“San Francisco’s Dirty Little Secret” addressed how regulation is being used to keep San Francisco segregated.

Last but not least MN Gordon posted “Adventures in Quantitative Tightening” – “If you recall, autumn of 1929 is when the U.S. stock market commenced a multi-year swan dive and the economy commenced a decade long Great Depression. This is the path Yusko believes we’re on. To be clear, this is a path that can be extraordinarily hazardous to your investment wealth.

For example, from September 3, 1929 to November 13, 1929, the DOW lost 48.9 percent. Then, as rarely noted, it rallied 48.1 percent through April 17, 1930. This had the adverse effect of luring the buy the dip crowd back into the stock market just in time for the next massacre.

In the end, it turned out to be the ultimate sucker’s rally. The stock market subsequently crashed 89.2 percent from its initial peak, along with the hopes, dreams, and aspirations of an entire generation. Such a colossal collapse could never, ever happen again, right?”

Enjoy – and learn something new!



But I Have No Choice

A common refrain, for almost any subject related to human behavior, is “I have no choice, this is all I can do.”

Of course when that choice is removed people always figure out something else to do despite the prior protest that they ‘had no choice’. The situation where a single choice is removed from the menu of human options and then everyone just dies off does not exist.

The situation does not exist because there is never a single choice. There may be a choice of less resistance but there is never a single choice.

When someone argues that there is no choice except to continue disastrous policies they are always making a false argument.  There are always alternatives to bad policy.

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