Is Argentina The Model For Where Obama Is Leading America?

I'm not an economic historian, but the following abbreviated history of Argentina rings true to me. Is this the pattern that Obama is following? Is this where America is headed? It doesn't look good. These are interesting and I fear, dangerous times.
Peter

Don't Cry For Me, America (source)

In the early 20th century, Argentina was one of the richest countries in the world. While Great Britain's maritime power and its far-flung empire had propelled it to a dominant position among the world's industrialized nations, only the United States challenged Argentina for the position of the world's second-most powerful economy.

It was blessed with abundant agriculture, vast swaths of rich farmland laced with navigable rivers and an accessible port system. Its level of industrialization was higher than many European countries: railroads, automobiles and telephones were commonplace.

In 1916, a new president was elected. Hipólito Irigoyen had formed a party called The Radicals under the banner of "fundamental change" with an appeal to the middle class.

Among Irigoyen's changes: mandatory pension insurance, mandatory health insurance, and support for low-income housing construction to stimulate the economy. Put simply, the state assumed economic control of a vast swath of the country's operations and began assessing new payroll taxes to fund its efforts.

With an increasing flow of funds into these entitlement programs, the government's payouts soon became overly generous. Before long its outlays surpassed the value of the taxpayers' contributions. Put simply, it quickly became under-funded, much like the United States' Social Security and Medicare programs.

The death knell for the Argentine economy, however, came with the election of Juan Perón. Perón had a fascist and corporatist upbringing; he and his charismatic wife aimed their populist rhetoric at the nation's rich.

This targeted group "swiftly expanded to cover most of the propertied middle classes, who became an enemy to be defeated and humiliated."

Under Perón, the size of government bureaucracies exploded through massive programs of social spending and by encouraging the growth of labor unions.

High taxes and economic mismanagement took their inevitable toll even after Perón had been driven from office. But his populist rhetoric and "contempt for economic realities" lived on. Argentina's federal government continued to spend far beyond its means.

Hyperinflation exploded in 1989, the final stage of a process characterized by "industrial protectionism, redistribution of income based on increased wages, and growing state intervention in the economy..."

The Argentinian government's practice of printing money to pay off its public debts had crushed the economy. Inflation hit 3000%, reminiscent of the Weimar Republic. Food riots were rampant; stores were looted; the country descended into chaos.

And by 1994, Argentina's public pensions -- the equivalent of Social Security -- had imploded. The payroll tax had increased from 5% to 26%, but it wasn't enough. In addition, Argentina had implemented a value-added tax (VAT), new income taxes, a personal tax on wealth, and additional revenues based upon the sale of public enterprises. These crushed the private sector, further damaging the economy.

A government-controlled "privatization" effort to rescue seniors' pensions was attempted. But, by 2001, those funds had also been raided by the government, the monies replaced by Argentina's defaulted government bonds.

By 2002, "...government fiscal irresponsibility... induced a national economic crisis as severe as America's Great Depression."

* * *
In 1902 Argentina was one of the world's richest countries. Little more than a hundred years later, it is poverty-stricken, struggling to meet its debt obligations amidst a drought.

We've seen this movie before. The Democrats' populist plans can't possibly work, because government bankrupts everything it touches. History teaches us that ObamaCare and unfunded entitlement programs will be utter, complete disasters.

Today's Democrats are guilty of more than stupidity; they are enslaving future generations to poverty and misery. And they will be long gone when it all implodes. They will be as cold and dead as Juan Perón when the piper must ultimately be paid.


References: A tear for Argentina's pension funds; Inflation in Argentina; The United States of Argentina. Linked by: Dan Riehl. Thanks!

Who Is Really To Blame For High Gas Prices In America?

Something to think about........especially between now and the November elections......GP


The Imperative of Developing Natural Resources
Paul Weyrich
Tuesday, June 17, 2008 (source)

The year was 1967. I was on a private aircraft belonging to an oil company with my boss, the late Senator Gordon L. Allott (R-CO). We were flying to Oklahoma City, where Allott was to address the State GOP Convention. An oil company executive asked me if ever I had seen oil shale. I said I had not. Whereupon he picked up a piece, took out his cigarette lighter, and lit the piece. It burned like high grade coal. The oil company man proceeded to tell me that if oil ever reached $30 a barrel it would be profitable to develop oil shale. Even with inflation oil has exceeded that price so why aren't we developing the trillions of barrels of oil-shale reserves. There is a one word answer to that question: Congress.

I receive mail from folks who tell me they don't vote because there is no difference between the political parties. In some ways they are correct but not when it comes to energy. Representative Roy Blunt (R-MO), House Minority Whip, has presented his colleagues with data which clearly makes the case that in terms of developing oil and natural gas there is a profound difference between the parties, at least in the House of Representatives.

Blunt's figures show that for the past 14 years 91% of House Republicans voted to develop oil at ANWR while 86% of Democrats opposed drilling there. In the conversion of coal to liquid category 97% of House Republicans supported the concept while 78% of Democrats opposed it. Regarding the development of oil shale in Colorado and Utah the level of support among House Republicans was 90% while the level of opposition to the development of oil shale among Democrats was 86%.

When it comes to oil exploration for the Outer Continental Shelf 81% of Republican House Members said yes while 83% of Democrats said no. And look at this figure: 97% of House Republicans want to increase refinery capacity while 96% of Democrats said, no way. Historically, Blunt said, 91% of Republicans have favored development of oil and gas reserves while 86% of Democrats historically have been against oil and gas exploration and development.

Blunt's staff also compared the plans of each of the parties to deal with the skyrocketing price of gasoline. The Democratic plan includes seven investigations of price-gouging, four investigations of speculators, suing OPEC, $20 billion in new taxes against the oil companies. None of these would reduce the cost of gasoline. The only item in their plan which would do so is to stop the oil going to the Strategic Petroleum Reserve. That would lower the cost of a gallon of gasoline by 5 cents The Republican plan would develop oil in the Continental Shelf and develop it deep in the sea. It would develop oil shale, and it would abolish earmarks to pay for the Federal gas tax holiday. Republicans and Democrats agree on the Strategic Petroleum Reserve. Taken together these items would reduce the cost of a gallon of gasoline by at least $1.95 and maybe a lot more depending on the productivity of each of the development projects.

What many of us wonder is this: When will the people of the United States say enough is enough and demand of their elected representatives that we develop our own resources? If we did we would not need to import one drop of oil from these ruthless dictators who would like to see us defeated or dead. I love the pristine beauty of nature, too. But we have made so many strides in new technology that we do not have to ruin the environment to explore and develop oil and gas. $4 a gallon doesn't yet seem high enough for a public revolt. What will do it? $5 a gallon? How about $8 to $11, which is what some Europeans are paying already. I hope and pray the revolt comes before it is too late.

Poweful Democrat Proposes Carbon Tax

With an issue that is certain to be a political "hot potato" in the up-coming elections in the U.S., a leading Democrat is proposing a new tax on the "carbon" produced by burning oil, gas, and coal. Apparently he expects a public outcry and he wants to demonstrate that the public is not willing to pay the cost to cut "carbon" emissions and thus, presumably stop global warming.

I'm not sure I understand the logic of this, but other Democrats want a carbon "cap and trade" system, where "non-polluters" could sell credits to "polluters", who would then be allowed to go on "polluting", but presumably at a lower rate because it would cost them. This way, (the logic goes) there would be less over-all pollution, and more non-polluting energy sources being used.

Did you follow that? You get paid (a credit) to produce "clean" energy and you get penalized (cap) when you produce "dirty" energy. What proponents of the "cap and trade" plan fail to disclose is that this will still cost the public more for energy. When they realized it will cost them just as much, or more for energy than just a simple tax on "carbon", they're going to be at least as unhappy. Good luck on getting any meaningful legislation through Congress.
Peter

from: http://www.nytimes.com/2007/07/07/washington/07carbon.html?_r=1&th&emc=th&oref=slogin

Counting on Failure, Energy Chairman Floats Carbon Tax

By EDMUND L. ANDREWS
Published: July 7, 2007
WASHINGTON, July 6 — A powerful House Democrat said on Friday that he planned to propose a steep new “carbon tax” that would raise the cost of burning oil, gas and coal, in a move that could shake up the political debate on global warming.

The proposal came from Representative John D. Dingell of Michigan, chairman of the House Energy and Commerce Committee, and it runs directly counter to the view of most Democrats that any tax on energy would be a politically disastrous approach to slowing global warming.
But Mr. Dingell, in an interview to be broadcast Sunday on C-Span, suggested that his goal was to show that Americans are not willing to face the real cost of reducing carbon dioxide emissions.

His message appeared to be that Democratic leaders were setting unrealistic legislative goals.
“I sincerely doubt that the American people will be willing to pay what this is really going to cost them,” said Mr. Dingell, whose committee will be drafting a broad bill on climate change this fall.
“I will be introducing in the next little bit a carbon tax bill, just to sort of see how people think about this,” he continued. “When you see the criticism I get, I think you’ll see the answer to your question.”

The idea behind a carbon tax is to provide an incentive to reduce the use of fossil fuels like oil and coal, which are loaded with carbon, and increase the use of cleaner, renewable fuels like solar power, wind and fuels made from plants and plant waste.
Many economists like the idea of a carbon tax, saying that it would be simple to administer and could profoundly affect energy choices.

But most Democrats are staunchly opposed, saying that a tax would raise the costs of travel, commuting and heating and cooling homes, and that it would be wildly unpopular at a time when voters are already angry about high energy costs. Republicans, they said, would seize on any such proposal as proof that Democrats were bent on raising taxes and increasing the size of government.

Indeed, many Democrats still cringe at the memory of President Bill Clinton’s trying to pass a broad “B.T.U. tax” in 1993 on most forms of energy. The measure passed the House but not the Senate, and more than a few Democrats believe the effort was one reason they lost their majority in the House in 1994.

Now, House and Senate Democrats are writing bills that would require factories and power plants to reduce emissions of heat-trapping gases through a so-called cap-and-trade system of mandatory requirements and tradeable pollution credits.

Most of the proposals would impose mandatory limits on the amount of carbon dioxide that companies would be allowed to produce each year, and those limits would become steadily more rigorous over time. A factory or a power plant that is already below the limit could sell its unused allocations to companies that were over the limit.
The United States already uses a cap-and-trade system to limit emissions of sulfur dioxide and other pollutants that cause acid rain.

The European Union has adopted a system to reduce greenhouse gas emissions, though the system has come under considerable criticism for letting companies game the rules and for failing to reduce emissions in line with European goals.

The Cap-And-Trade Scam

If the global warming issue was only a scientific debate it could easily be dismissed as an intellectual mind game between scientists and computer modelers. It would be comparable to the argument between those who "believe" in evolution, versus those who "believe" in a literal interpretation of the Bible. There would be no end to it and it would not have to be taken seriously.

However, global warming became an emotional, political issue, and now it seems as divisive as the abortion issue, or gun-control, or foreign policy in the Middle East. In other words, it has become a huge issue, one involving enormous power, control, and billions upon billions of dollars. It is past time that rational people take serious notice about what is really going on behind the nightly news and the weather report.

The following article, of which I've posted the majority of, summarizes the idiotic idea of selling or trading carbon caps. It will cost billions and not improve the climate or limit real pollution in any way. In other words, it is a huge SCAM. Yet incomprehensibly, people are falling for it.
Read the original article here: http://www.cnsnews.com/ViewCommentary.asp?Page=/Commentary/archive/200705/COM20070514c.html
Peter



The Great Cap-And-Trade Scam
By Alan Caruba
CNSNews.com Commentary from the National Anxiety Center May 14,
Of all the crazed global warming proposals being put forth by the new masters of Congress, Speaker Nancy Pelosi and Sen. Barbara Boxer, chairperson of the Public Works Committee, by far the worst would be a mandated cap-and-trade program that would supposedly offset carbon dioxide emissions.

This program is horrid on several counts. First, there is not a scintilla of scientific evidence -- other than disputed and dubious computer models -- to suggest that any significant global warming is occurring. The warming and cooling of the Earth is an entirely natural phenomenon.

Second, carbon dioxide (CO2) plays only a minor role as a so-called greenhouse gas. The predominant greenhouse gas is water vapor produced by the world's oceans. The Earth has been warming since the last Ice Age and, even if a mild warming were to occur, the only result would be an extended period to grow more crops and to enhance the growth of the world's forests that generate the oxygen on which all humans depend for life.

Third, the notion that man-made CO2 emissions -- the result of industrial activity, the use of cars and trucks for transportation, and a host of other things humans do -- is a major contributor to "climate change" is almost too silly to believe. Recently, the European Union identified cow and sheep burping as an even greater threat than human activity, but ruminants have been doing this long before human civilization began.

To get an idea how bogus cap-and-trade emissions credits are, one need only look to see who is behind this spurious campaign. At or near the top of that list is the United Nations for whom global warming has become the Holy Grail. By positioning themselves to save the Earth, the U.N. sets itself up to control all aspects of life upon it. Supporting the U.N. program are the endless non-governmental organizations that benefit from keeping people fearful the Earth will come to an end without their programs to save it.

The adage, however, is "follow the money" and here's where we find the greatest supporters of cap-and-trade emissions credits. Huge financial firms such as Morgan Stanley and Goldman Sachs are betting they can make billions through government mandated programs in which vast amounts of money move back and forth through "climate exchanges" where companies trade their alleged emissions reduction activities for credits, i.e., real cash.

The absolute worst part of these cap-and-trade emissions programs is the way they will affect the American consumer. A recent report by the Congressional Budget Office (CBO) delivered a devastating indictment of the proposal.

In brief, the CBO concluded that the CO2 cap-and-trade scheme would increase home energy costs and the price of gas, unfairly punishing the poor while transferring wealth to the rich who have investments in these industries.

Not one of the nations that signed onto the Kyoto Protocol to limit their CO2 emissions has ever met the standards to which they agreed and none ever will. The cap-and-trade scheme is just another version of these meaningless limits, but one that is designed to enrich those who engage in the smoke-and-mirrors trade in such credits.

If a Democrat-controlled Congress permits this to occur, the global warming scam will have been brought to its full culmination and purpose, the enrichment of those who have been perpetrating it and those who seek to benefit from it.