‘The Kronies’ Will Make You Laugh in Despair about the State of American Capitalism

Big G knows better than some flimsy scrap of paper, citizen!All hail Chimera Incorporated!
What, you think that corporation name sounds sinister? What kind of
American are you, anyway? No, Chimera Incorporated is bringing us
“The Kronies,” the awesome super-powered team that keeps this
country big and strong through the tools of crony capitalism. Save
us from those selfish entrepreneurs who want the unpredictable
“market” to decide who the winners are. Why should the market get
to decide when we’ve got all this influence?

Here’s an introduction to The Kronies:

I defy you to find a better way to reach Gen Xers who distrust
the government (by which I mean, “Gen Xers”) than a parody of
terrible Saturday morning cartoons from 30 years ago. The site for
the Kronies is here, featuring
descriptions of their “heroes” and their abilities to direct
government spending their way with powers like mandates and
boondoggles. Right now they represent the ethanol industry, big
banks, big labor, and the military-industrial complex, led by “Big
G,” the manifestation of the bipartisan nature (his costume is
equally split between red and blue) of government crony spending.
The site promises a shop coming soon, and we can only hope they
follow through.

Glenn Beck and The Blaze tracked down the mastermind of the
site, John Papola, CEO of Austin-based production company Emergent
Order. Beck
interviewed
Papola about the bipartisanship nature of crony
capitalism and the business culture that makes it so hard to fight.
In short, the more powerful the government, the greater the
incentive for crony capitalism.

“I really believe that it’s fundamentally the unique nature of
government as a monopoly that gives rise to these things,” he told
Beck. “Whether you’re General Motors or General Electric or — you
name the big corporation — and you have a fiduciary duty to go
after the maximum profit, and you have the opportunity to use
legislation to help do that or help keep your competitors at bay,
you’re gonna do it. The incentives are so perverse that it’s not
even a matter of morality after a certain point, because if your
competitors are doing it, are you going to fire your people to be
the nice guy, because you let the other guy take the subsidies and
rig the rules against you?”

I’m crossing my fingers for a video game in the future. As it’s
a licensed intellectual property, it must be a very, very bad video
game that costs too much, as is typically the case.

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Lawmaker Dreams of Transforming Hawaii Into Marijuana Production Hub

Hawaii House Majority Leader Rida Cabanilla
thinks that legalizing the production and exporting of pot would be
the golden opportunity for Hawaii to tackle its $25 billion
debt.

Cabanilla told
Hawaii Reporter:

This state would turn into a manufacturing state. Can
you imagine factories that would be making ‘Maui Wowie’ cookies and
making marijuana macadamia nut candy for export? I think that would
be wonderful.

Maui Wowie, the renowned Hawaiin strain of marijuana, has been
the subject
matter
of Kid Cudi.

The
bill
also mentions “cannabis-infused chocolate, ice cream,
beverages, capsules, bath soaks, and muscle relief lotions.”

Cabanilla insists she’s not calling for marijuana legalization.
She doesn’t like the stuff. But she thinks it’s a practical step
toward reducing the state’s unfunded liabilities.

First Cabanilla needs to pass House
Bill 2124
which would put the state’s Department of Agriculture
and Department of Business, Economic Development and Tourism at the
helm of a temporary working group. It would be tasked with
outlining an export plan and handling other tricky logistics.

Tax revenues would be divided amongst the state Department of
Education, Department of Health, Public Housing Authority, and
Housing and Finance & Development Corporation.

Cabanilla sees a number of problems receding post-roll out:

“I am not even a fan of it. But if that is what it takes for our
state to be in the forefront where we can fix our roads, we can
build more affordable housing, we can help the homeless —that is
the route we should go.  And people in Hawaii will be so
happy, because this may be the state that they don’t have to pay
property tax.”

She added: “Our farmers will never be poor again.”

Hawaii has the optimal climate for the production of illegal
substance production. The bill
reads
:

The Goddess Pele has provided Hawaii with the best soil in the
nation for marijuana cultivation; it should be capitalized upon for
the good of her people.

Of course, recreational drug use in Hawaii, like in most states,
is illegal. The bill would not lift barriers to domestic use.

But one day Hawaii could export to foreign countries, like the
Netherlands, where it is legal. Cabanilla also hopes to work with
Colorado and Washington, which are unrolling legalization this year
and are facing shortages. Hawaii could fill the void.

Unfortunately, Cabanilla’s plan faces an uphill battle with the
federal government. Moving the plant on federal property is
illegal. But Hawaii in the case that the federal government
entertains a change of heart, the state will be “ready to
rock.”

Watch the interview from Hawaii Reporter with Rida
Cabanilla below:

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Obama Channeled Ron Paul Last Night (Kind of)

During the
State of the Union
address last night Obama said the
following:

We must fight the battles that need to be fought, not those that
terrorists prefer from us – large-scale deployments that drain our
strength and may ultimately feed extremism.

This doesn’t that much different from what has been said by the
non-interventionist former Texas Congressman Ron Paul, who has
pointed out that American foreign policy and diplomacy might have
something to do with why the U.S., and not another country which
allows for freedom of religion and women’s rights, is one of the
primary targets of Islamic extremists.

During the race for the Republican presidential nomination in
2008 Paul’s differences with most of the rest of his party when it
came to foreign policy were highlighted by an exchange with former
New York Mayor Rudy Giuliani. Watch that exchange below:

The main difference between what the president said last night
and what Paul has argued is that Obama’s statement is
understandably less definitive. Obama drew a comparatively weak
causal relationship between “large-scale deployments” and
“extremism” by saying that the former “may” lead to the latter.

It is ironic that it is Obama, who has overseen years of what is
perhaps the most
unpopular war
in American history as commander in chief, is the
one warning of the risks of large military deployments abroad.
Around
37,500
American troops are in Afghanistan. 

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Katherine Mangu-Ward on the Eternal Recurrence of Race to the Top in the State of the Union

thumbs

This year, in the State of the Union address, President Barack
Obama touted a success in reforming K-12 education in America:

Race to the Top, with the help of governors from both parties,
has helped states raise expectations and performance.  

And it’s true that Race to the Top has been a pretty
good program
. But it was ultimately a pretty small reform and
the effects have petered out. 

But that hasn’t stopped the president from filing almost the
entire K-12 portion of the education sections of his State of the
Union addresses with a brag on Race to the Top, writes
Reason magazine Managing Editor Katherine
Mangu-Ward.

Every. Single. Year.

View this article.

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Ted Cruz: Democratic Abuses of Executive Power Should Be a Bipartisan Concern

In today’s Wall Street Journal,
Sen. Ted Cruz (R-Texas)
condemns
President Obama’s “persistent pattern of lawlessness,
his willingness to disregard the written law and instead enforce
his own policies via executive fiat.” The piece, which focuses on
three ways in which Obama has flouted the plain language of the
Patient Protection and Affordable Care Act, is mostly on target,
although I
question
Cruz’s contention that declining to prosecute
state-licensed marijuana growers and sellers is tantamount to
violating the Controlled Substances Act. The most striking thing
about Cruz’s essay is what he left out.

While Cruz argues (correctly) that the abuse of executive power
“should not be a partisan issue,” he does not cite a single example
involving a Republican president, although he does concede that
“Republican presidents abused their power” and might do so again in
the future. And although there is no shortage of cases
in which Obama has acted lawlessly in the name of national
security, Cruz does not mention any of them, possibly because doing
so would raise the hackles of hawkish Republicans and bring to mind
similar sins by Obama’s Republican predecessor.

One of the earliest and clearest examples of Obama’s lawlessness
stemmed from his determination to bail out the auto industry. But
it was George W. Bush who initiated the illegal use
of money from the Troubled Asset Relief Program to rescue American
car manufacturers from their own mistakes—a policy that Obama
welcomed as a senator and expanded as president. Obama went further
with his high-handed engineering
of the merger between Chrysler and Fiat, a deal that violated
well-established bankruptcy principles.
But bringing that up would remind anyone who was paying attention
that Obama’s abuse of executive power in this area was a logical
extension of Bush’s.

The same could be said of the National Security Agency’s
surveillance programs. After condemning the NSA’s warrantless
wiretapping of Americans’ international communications during the
Bush administration, Obama voted to authorize it, and it continues
to this day. Likewise the NSA’s routine collection of every
American’s phone records, which Obama claims is authorized by the
PATRIOT Act. The main author of the PATRIOT Act disagrees.
Yet Cruz does not mention illegal surveillance as an example of
Obama’s (and Bush’s) excesses.

Nor does Cruz mention Obama’s completely optional yet
congressionally unapproved 
air
war
 against Muammar al-Qaddafi’s regime in Libya,
although it is hard to think of a purer example of the president’s
unilateralism. The Constitution gives Congress the power to
declare war, but Obama never sought such a declaration. He
even 
argued,
against the advice offered by his own Office of Legal
Counsel, that the War Powers Act, which requires congressional
authorization for the continued use of military force without a
declaration of war after 60 days, did not apply, because the bombs
and missiles raining down on Libyan forces did not constitute
“hostilities.” I don’t know where Cruz, who took office last year,
stood on Libya, but many of his fellow Republicans think the
president should have a great deal of discretion in deciding when
and why to use military force. Some of Cruz’s
comments
about Syria suggest he may agree.

Cruz even overlooks two executive-power issues related to
national security that he has highlighted in the past. Last year
Cruz challenged the
president’s license to kill anyone he suspects of involvement in
terrorism, and he voted
against
the National Defense Authorization Act because he
was “deeply concerned that Congress still has not prohibited
President Obama’s ability to indefinitely detain U.S. citizens
arrested on American soil without trial or due process.” But
imprisoning and killing people at will somehow do
not 
make Cruz’s list of Obama’s most troubling
power grabs, possibly because so many of his fellow Republicans do
not see anything wrong with those policies.

“In the nation’s history,” says the subhead above Cruz’s
op-ed piece, “there is simply no precedent for an American
president so wantonly ignoring federal law.” Although Cruz may not
have written that, he did not challenge the claim when CNN’s Jake
Tapper read it back to him last night. Instead he tried to make the
case that Obama has indeed been especially lawless. In the
Journal essay, he suggests that Democrats (including
journalists covering the White House) have been less keen to
challenge Obama’s abuses than Republicans were to challenge
presidents of their party:

In the past, when Republican presidents abused their power, many
Republicans—and the press—rightly called them to account. Today
many in Congress—and the press—have chosen to give President Obama
a pass on his pattern of lawlessness, perhaps letting partisan
loyalty to the man supersede their fidelity to the law.

From the perspective of someone who is neither a Democrat
nor a Republican, both the abuse of executive power and the
willingness to overlook it when a member of your party occupies the
White House seem like bipartisan tendencies. 
Cruz
would be much more credible on this issue if he forthrightly
admitted that instead of insisting that the other team is
worse.

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Rand Paul Speaks on Culture of Dependency, Hemp and the Farm Bill, the Racial Aspect of Drug War, and the Burdens of Being a Libertarian Poster Boy

I chatted with Sen. Rand Paul (R-Ky.) this morning via phone
about his
State of the Union response
, the farm bill, and
bearing the burden
of presumed political spokesman for all
libertarianism.

His
speech last night
, released independently via the Internet
rather than being an official Republican or even “Tea Party”
branded response, stressed a theme that hasn’t been a particularly
big deal in American politics since the Reagan years–and indeed
Paul summoned Reagan’s spirit right at the start.

That’s the dangers of a culture of dependency, how government
efforts to supposedly help can trap the poor while ignoring the
real, free-market ways of lifting people up the economic ladder.
(And it is worth noting, and you’ll read more about this from
Ronald Bailey in the forthcoming April issue of Reason
[subscribe now!]
that American economic mobility has
not actually been particularly worse lately
than
historically.)

“People feel trapped and it’s not their fault, the government
doesn’t provide them an exit,” Paul said. “They don’t have an easy
way to get out of dependency and if we are trying to fight long
term dependency or long term unemployment we have to figure a way
out. And that has to be the creation of a vast numbers of
jobs.”

Paul believes that government attempts to target its (really,
our) money to the places where jobs can or should be
created will tend to be ill-aimed. “The marketplace sorts through
 who are the good job creators,” Paul says, through a process
of creative destruction that weeds out many, many failures.

So it’s better, Paul says, to “give money back in the form of
tax reductions” since “the marketplace, consumers have already
voted who are the good job creators” rather than funnelling money
to Washington to take its skim and than back to local communities
in the hopes good things happen. That generally just leads to
cronyism and government trying to shape outcomes it, rather than
consumers and citizens, choose.

Paul in his SOTU response sounded very Reaganesque when he told
the story of Star Parker, a former welfare user–welfare abuser, in
her own telling–who decided to eschew dependency on government and
became a successful writer, pundit, and even congressional
candidate. She is black, and Paul has talked in the past of the
importance of the Republicans
reaching out to black constituencies
. Does he think talking
“culture of dependence” can help with that?

“I think the message has to be there is a way out,” Paul says.
“People who have been on welfare are not bad people, they are not
wanting to be there” so Republicans need to promote “a way to get
out from under that and into the middle class. It is a message you
haven’t necessarily heard from Republicans,” Paul says. “It’s not
that anyone is condemning anyone for being poor, but we have to
have a debate” about the best ways to lift people from poverty,
rather than “saying ‘Hey, we are Democrats and we are against
poverty, we are the Party to go for if you want alleviation of
poverty.'”

“They had a chance in Detroit and Detroit is a disaster,” Paul
says. “For many years [Democratic policies] have run many cities”
and those policies “aren’t good for cities and aren’t good for the
poor.”

Given that he said in his SOTU response that “I believe in an
America with a strong safety net,” what are more specifics about
the sort of government aid programs that need to be changed,
curtailed, or killed?

“There needs to be a gateway back into the job market,” Paul
says. “Things that are permanent need to be made temporary, things
that are duplicative need to be gotten rid of.” And his vision of a
basic safety net from government, Paul says, “should be closer to
home, state vs. federal” and should be “transitional to getting
into the work force, not lifelong or even, many times,
multigenerational.”

Thus, Paul along with Sen. Mitch McConnell last month introduced
his “Economic
Freedom Zones” Act
which would lower tax and regulatory burdens
in areas that are particularly economically troubled,
with Detroit
as his leading example of an area that could use
it. How’s that going politically?

“It’s tough,” Paul says. His colleagues from Michigan, Paul
says, even though his plan would likely leave $1.3 billion in the
Detroit economy, aren’t showing much interest in the plan. “We are
at odds. Democrats tend to believe midnight basketball or
afterschool programs or education grants” will be enough to ensure
that “jobs will be better, and they tend not to understand money
needs to get back in the hands of people in private marketplace,”
especially “those already voted upon by consumers as succeeding in
business.”

The farm bill up for consideration this week has a provision to
allow
limited experimentation with hemp
, a cause
dear to Paul’s heart
. What’s he think of that?

“It’s a step in the right direction,” Paul says. His own state
of Kentucky has “tried to normalize and regulate hemp, let farmers
do it. But people are still worried about getting prosecuted by the
federal government,” so he’s “afraid we have not as ambitious a
program” as he’d like. “l have
legislation
to completely legalize [industrial] hemp across
America” and he’s asked the attorney general’s office to issue a
letter saying that they officially will not federally prosecute
people on state level farming industrial hemp.

As for the farm bill as a whole, “it’s hard to vote for a bill
with $800 billion of food stamps, even with belief in some safety
net, it’s not a belief in a safety net that goes on and on and is
not paid for by corresponding cuts somewhere else.”

Obama avoided the drug issue in his SOTU, though he’s publicly
mellowed considerably on the issue. Do the changing politics of the
issue allow Paul to openly advocate things like full legalization
or targeting the DEA as a government agency we could do without for
fiscal sanity reasons?

He didn’t address that issue specifically–perhaps as part of
his general lack of desire to be the public spokesman for radical
libertarianism that some want him to be, more on which below–but
did say that we need to “acknowledge the war on drugs had a racial
outcome, it may be inadvertent but it’s hard to argue there hasn’t
been a racial outcome with three out of four in jail for
non-violent drug crimes being black or brown.”

“My goal,” Paul says, has been “to figure out a way to get rid
of that racial outcome” and stress that “penalties have been too
harsh for nonviolent crimes.” He’s trying to “do everything I can
to lessen mandatory minimums and allow people to have rights
restored” if imprisoned for non violent drug crimes, so he’s chosen
to stress “the criminal justice angle rather than the legalization
angle.”

Many reporters try to press Paul to publicly speak up for purist
libertarian stances, as I did, as CNN tried about the minimum wage
last night
, or to link everything any libertarian has ever said
about anything to Paul, as the New York Times tried in its

big profile on him Sunday
.

“I’ve got half the libertarians on the Internet beating up on me
for not being pure enough,” Paul says, “and the rest of the
mainstream beating up on me for being too libertarian. It’s a box
they put me in.”

“But I’m in the business of trying to advance a philosophy and
advance an economic program that’s better for the country. And I’m
also in the business of winning elections and trying to convince
people to come in the direction of smaller government and more
individual liberty,” Paul says. “I sometimes wish for a little more
forebearance among the purists, but I’m trying to do the best I can
to advance a philosophy and program that is more individual liberty
for everyone and is pulling in the direction of what some of the
purists might want” even if they “might not see it as pure as
they’d like.”

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Obama is Over

When a president frames his speech around a call
for a “year of action,” you can safely bet that the next 12 months
will be as action-packed as an afternoon nap. The subtext of last
night’s State of the Union address was that Obama’s presidency is
not just frustrated but tired; it’s not only that he can’t do much,
thanks to Republicans in Congress, it’s that he has so few
remaining ideas about what to do. (Last night’s most significant
new ideas was a vaguely explained
government-backed retirement savings program
.)

Five years in, the Obama presidency has already been exhausted.
And so Obama plans to ride it out, propping up the laws he has
already passed, doing his best to stop Democrats from losing too
many seats in 2014, and tweaking policies through executive action
where he can. Yes, there will still be controversies surrounding
his administration, and yes, the president will still be the center
of considerable attention and controversy from both fans in
critics—but mostly for what he’s already done, not what he wants to
do. He’ll be in office for another three years, but he’s already
finished. Obama is over.

Meanwhile, as the Obama presidency grows stale, it’s the once
agenda-less Republicans and their conservative allies who are busy
generating fresh new ideas. Obama has talked broadly about tax
reform for years, but it’s Republican Sen. Mike Lee (Utah) who
recently put forth a big plan to overhaul the tax code. Obama last
night challenged Republicans who oppose Obamacare to present some
kind of alternative—but failed to acknowledge the three GOP
Senators (Coburn, Hatch, and Burr) who did so just this week. Rep.
Paul Ryan (R-Wisc.) and Sen. Marco Rubio have spent the last month
talking up policies to address poverty. Lee and Sen. Rand Paul
(R-Ky.) are amongst the nation’s most aggressive champions of
criminal justice reform. Obama’s State of the Union rehashed old,
flawed arguments about health care and education; Sen. Lee’s

response to the president’s address
highlighted a slew of
Republican reform ideas from transportation to education to
energy.

Meanwhile, small but influential journals like National Affairs provide
a forum for right of center policy wonks to work through their
ideas in detail, looking at both what to do and how to do it. The
evidence suggests that at least some Republican politicians are
listening.

You can see tensions, too. There’s a push and pull at work,
between technocratic conservatism and revivalist libertarianism,
between those who are more concerned with, say, spending taxpayer
money well and those more concerned with spending money less,
between the party’s individualistic impulses and its communalist
concerns. There’s still plenty left to work out.

But this is how a party develops an agenda. Not overnight, with
a dictum from the top or the selection of a presidential candidate,
but over time, through iteration and experimentation, and through a
conversation with itself—and eventually with its critics as well.
For too long, the right has lacked the infrastructure to start this
conversation and the political will to carry it on. Its agenda has
been opposition, and little else. But that’s changing, in part
because of the efforts of conservative reformers, and in part
because the Obama agenda is so clearly nearing its end.

Not all of these Republican ideas are fully formed. Not all of
them are practical, or politically feasible. And not every
Republican is on board; party leadership is still far too hesitant
to engage with the right’s policy reformers. But Republicans are,
finally, talking about what to do. Obama is stuck talking about
what he’s already done. 

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Former Georgia Corrections Commissioner Supports Lawsuit Over Jailhouse “Rapid Response Team” Abuses

complianceSeveral former inmates of a county jail in
Georgia allege in a class action lawsuit filed last year that the
Gwinnett County sheriff and his“rapid response team” abused the use
of restraint chairs at the jail, leaving inmates in it for hours at
a time. The Gwinnett Daily Post
describes
what it saw of the practice, apparently used more
than 200 times in the six months before the lawsuit was filed last
summer:

The rapid response team is a SWAT-style group made up
of highly trained deputies. Videos previously viewed by the Daily
Post show members, upon being summoned, staging outside a cell in
helmets, vests and masks before entering, pinning down the inmate
in question and putting them in the chair. Some were shot with
pepperballs prior to deputies entering the cell.

Last week, a former Georgia Department of Corrections
commissioner who spent 40 years working in the system, filed a
report in favor of the lawsuit’s claims.
Via the Post:

[Allen] Ault’s thoughts included the following:

— “In my opinion, the problem is not how they conduct a takedown,
but rather, the almost total indiscriminate use of the RRT that
have now become standard practice in the jail.”

— “Although it would be a daunting task to get the actual number of
deployments of other Response Teams, I would venture to state,
based upon my experience in the field and without fear of
contradiction, that the Gwinnett County RRT has been deployed more
often in the last thirteen years then (sic) the combined total of
all other County, State and Federal facilities located in the state
of Georgia.”

— “Instead of the RRT being deployed as the last resort, it is
being deployed as the first choice of preference by staff to handle
a ‘problem’ inmate. Upon arrival, the RRT routinely uses force
where no force is justified.”

— “It was also obvious that it was being used to punish some
individuals who had been ‘vulgar’ in either language and/or deed in
‘reception’ or elsewhere in the jail before being placed in a
cell.”

— “… way too often, in my opinion the ‘takedown’ and the use of the
‘restraint chair’ is a ruse for implementing excessive
force.”

The alleged misuse of law enforcement tools to hide excessive
force is not unique to Georgia. A recent newspaper report in
Philadelphia
chronicled
the apparent return of the “nickel ride,” when
police drive vans recklessly to inflict injury on detainee
passengers. As Alonzo Harris, the crooked cop in Training
Day
played by Denzel Washington, observed after a use of
excessive force, “it’s not what you know, it’s what you can prove.”
Police unions and deferential local governments have often helped
make even that
not enough
.

You can watch Gwinnett County’s rapid response team in action
here:

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Where Does This Market Rally Rank?

Submitted by Lance Roberts of STA Wealth Management,

 


    



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The Difference Between GAAP And Non-GAAP In One Chart

What is the difference between GAAP and Non-GAAP Net Income? Only about 109% if you are Facebook.

The chart below shows the quarterly reported Net Income for the social networking site on a GAAP and non-GAAP basis.

Adding up the quarterly numbers from Q4 2011 until Q4 2013, one gets the following GAAP vs Non-GAAP differential.

Guess which accounting gimmick-based number is FaceBook “valued” on.

* * *

But there is good news: according to FaceBook it now has 201 million Monthly Average Users in the US and Canada.

One may ask – how many people are employed in the US and Canada – the answer 136.9 million in the US and 17.7 million in Canada, or a total of 154.6 million. Oh well, those 50 million who are unemployed – they will just grow into the labor force eventually and be able to buy all those products whose ads they click on.


    



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