Monday, February 27, 2017

Vitriol and Volatility

Anyone who lives near the sea knows that it changes daily. It may be glass smooth one day and have raging white caps the next. It is much like the ebb and flow of life. Few things on earth do not have ups, downs and bumps along the way.

You generally also see this in markets, in particular, the stock market. The ups and downs from day to day are referred to as volatility. Volatility is the range by which a security or a market may increase or decrease over a period of time.

Securities or markets that have higher volatility are considered inherently riskier that securities that have low volatility. That applies to both stocks that go up, as well as down, quickly or erratically.

Stock market pricing is interesting because on a day to day basis there is usually not a substantive reason why a stock price moves up or down. Business prospects do not usually change for the good or bad in a day, a week or a month. What moves markets or stocks in the short term are the emotions of buyers or sellers.

I like what legendary investor Benjamin Graham said about the stock market many years ago.

“In the short run, the market is a voting machine but in the long run, it is a weighing machine.”

Why is this of interest to me today?

Who are we led to believe every day in watching in the news is the most unbalanced, unreasonable, unhinged, volatile person on the planet?

President Donald J. Trump.

To hear liberals, the media, the political establishment and Hollywood talk about Trump, none of us should have any confidence in our future. Chaos will reign. Calamity is upon  us. Everything and anything about Donald Trump is utterly contemptible.

How is that emotion-driven, voting machine of a stock market reacting to all of this?

Yes, we know the stock market has steadily risen ever since the day after Trump was elected. In fact, the Dow closed today at a record high for the 12th consecutive day. That has not happened since 1987. That says something by itself. However, let's put that aside.

Let's just look at stock market volatility. You would think by watching the news that stock market volatility would be high given the "risky" environment that Trump has created. Investors do not like uncertainty. It is hard to be confident about the future when things are uncertain. Uncertainty and risk should contribute to volatility.

That is why I found this chart in The Daily Shot this morning to be particularly interesting. It shows that stock market volatility, as measured by consecutive days without a 1% intraday move up or down in the S&P 500, is the lowest in well over 50 years.

As of Friday, there had been 48 consecutive trading days without a 1% intraday move as the chart above shows. That is now 49 days since we did not see a 1% intraday move today (February 27).

Stock market volatility has been at historic lows since Trump became President while the political vitriol of his opponents is at historic highs. Rather interesting, isn't it?

If the stock market is a voting machine in the short term, there seem to be a lot of votes out there for what Trump is doing and what he is promising. For all the talk of the "erratic" Trump, the stock market is reacting as if we are sailing on a silky smooth sea.

In the middle of the Pacific Ocean on my TransPacific cruise last August

However, the calm seas we are seeing now are sure to turn rough soon. It is the nature of the world, life and markets that ups and downs are inevitable. I can promise you that rough seas of some sort lie ahead. The stock market will not go up forever. And it will surely bounce around and make us feel as if we are a on raft going over Niagara Falls at some point.

In the long run, the measure of Donald Trump as President of the United States will not be determined by the volatility of the markets, the volume of vitriol directed at him, or Trump's vision to "Make American Great Again".

In the end, everyone will weigh his results.

That is how it should be and how I believe Trump measures himself.

It would be nice to see a few people take a deep breath, save some of the vitriol and see what he can do.

How do I weigh the chances of that occurring?

Sunday, February 26, 2017

Medicaid Math and Myths

One of the interesting insights surrounding the potential repeal and replacement of Obamacare is this telling statement from the junior Senator from California, Kamala Harris.

Let's consider that statistic.

Harris states that 50% of California children are on Medicaid which is referred to as "Medi-Cal" in the state.

The obvious question is how has a welfare program for low income individuals, that did not even exist until 1965, came to cover half of the children in a state?

The next question is how could a state like California, which is totally controlled by Democrats, come to a point that half of its children are so poor that they have to rely on the federal government to such a degree?

It is also interesting to note that over half of the total births in California are paid by Medi-Cal. This graph shows the trends in California since 1977 until 2011. This percentage is undoubtedly much higher today due to the expansion of Medicaid which added 3.8 million people to the program in the state since 2014 (by the way, that is 4 times the number that was originally projected when Obamacare was passed). It would not surprise me that almost 3 out of every 5 births in California are being paid by the taxpayers today.


The Medicaid program is jointly funded by the federal government and the states. The states generally set eligibility standards for their state subject to federal limits and the federal government provides matching funds to assist in the costs.

This graph from the Department of Health and Human Services provides some context on the massive growth of this entitlement program since its inception in 1965. From no participants in 1964 to a projected 80 million in 2025.

Credit: Department of Health and Human Services
2016 Actuarial Report on Medicaid

Under Obamacare, the states were given incentives to increase Medicaid eligibility with the federal government promising to pay 100% of the additional costs for 2014-2016. This year that subsidy is reduced under the law to 95% and it will phase down to a 90% subsidy in 2020 and and later.

Predictably, Medicaid expansion has been the most popular feature of Obamacare. After all, "free" always has a lot of takers. However, it has come at a cost. Federal money for the expansion was projected to cost $42 billion in 2015. The actual federal cost was $68 billion---62% higher than estimated.

32 states (including DC) elected to expand Medicaid and 19 states did not. The 19 states that did not do so understood that nothing is ever "free".  When the federal government hands out money, strings are always attached. In addition, "free" only lasted for three years with Medicaid expansion. The states that expanded Medicaid now have to pay part of that cost going forward.

For example, in California, the expansion will cost the state an additional $500 million in 201 compared to 2016. By 2020, the additional cost to California is projected to increase to between $1.4 billon-$1.9 billion per year.

For perspective, California is spending over $100 billon for its Medicaid program of which about 63% is paid by the federal government. State spending on Medicaid in California is approaching $40 billion per year. California will collect about $84 billion from personal income taxes this year meaning that almost 50% of its income tax collections are necessary to just fund its Medicaid costs.

68% of births paid by Medicaid in California in 2011 (the most recent data I could find) were born to mothers of Hispanic origin. At least 30% of all births were to undocumented illegal immigrants. 45% of all Medicaid births in the state were to foreign born mothers. All of this data is in this report

All of this spending on Medicaid has had the result of squeezing everything else in the California budget as it has in most every other state budget across the United States.

For example, here is what has happened to state support for the University of California and California State University systems on a per student basis since 1980 as Medicaid costs have taken larger amounts of the state budget.


I wrote about what Medicaid and health care spending have done to my home state of Ohio in this post back in 2014 just as Governor Kasich was ignoring the will of the Ohio people and the state legislature by expanding Medicaid under Obamacare.

From 1970 to 2014, inflation would have increased the Ohio state budget by 6.1x if all spending matched the rate of inflation over those years.

The Ohio budget had, in fact, actually increased by 22.3x over that time---over three times the increase in inflation.

Education spending had increased by 14.5x. Higher than inflation but much lower than the overall increase in state revenues and state spending.

However, health care spending, driven principally by Medicaid, had increased by 66.7x!

Of course, the policy argument made for increasing Medicaid eligibility was that it would assist in keeping costs down for private sector employer and individual health plans by reducing uncompensated care costs. The logic was that these costs ended up being charged to private sector plans and better managing these costs within the Medicaid system would reduce overall costs (lower emergency room visits etc) while moving these costs to the government would alleviate the private sector from bearing these costs.

However, I have seen no evidence that this had been the result in any data I have looked at.

For example, the average single premium per enrolled employees in private sector employer plans in California increased by 28.2% between 2009 and 2015 (the  most recent data available). That is higher than the U.S. average increase of 27.7%. Compare that to the 18.6% increase in private sector costs in Georgia which did not expand Medicaid.

Even when you compare California to two other states with large, immigrant populations---Texas and Florida--who did not expand Medicaid, there is nothing to indicate that Medicaid expansion reduced costs to the private sector. Both those states saw increases of 30%, just slightly higher than California.

In Ohio, the cost increase for private sector employer plans was 39.4%. Compare that to Wisconsin which did not adopt the Obamacare expansion with federal dollars, but did a modified eligibility expansion. Its costs have only risen by 17.1%

All of the private sector premium cost data reference above is from the "Medical Expenditure Panel Survey" which is published annually by the Agency for Healthcare Research and Quality of the U.S Department of Health & Human Services.

It is also interesting to look back at the Congressional Budget Office projections in 2013 right before Obamacare was implemented to put all of this in perspective.

What has Obamacare really done?

It has massively increased the Medicaid rolls and massively increased taxpayer costs at both the federal and state levels while doing little to control private sector health care costs. In fact, Obamacare mandates have massively increased the costs of individual and employer plans. The individual market has been destroyed and it is only affordable to those who receive federal subsidies in the exchanges.

As Obamacare repeal effort are being discussed you are going to hear a lot of statements like those of Senator Harris that are intended to sway public opinion with emotion. Consider the math of Medicaid and see through the myth that the expansion effort has been anything but another redistribution scheme. In the end, Obamacare is more about buying votes than making health care more affordable and available for everyone.

For the Democrats that means taking dependent children and ultimately making them dependent adults who will vote for Democrats in the future. It is on full display in California.

Wednesday, February 22, 2017

The Rocky Road To Repeal

Republicans have been talking about repealing Obamacare since the day it was signed into law in 2010.

It was a principal reason they gained control of the House and Senate in 2010.

It was a principal reason they dominated Congressional races in 2014.

It was a major reason that Donald Trump won the Presidency.

However, talk is cheap in politics. It is easy to talk about what you are going to do. It is difficult to actually do it.

You begin to understand how rocky the road to repealing and replacing Obamacare is when you consider three facts.

1. Obamacare's dictates touched fully 1/6 of the U.S. economy. Something that touches so much cannot be easily undone without risking turmoil. Can something so intertwined in the American economy be unwound easily?

2. There were 1,380 days between the time Obamacare was signed into law and its effective date of January 1, 2014. To put that in perspective, that is longer than the period from the bombing of Pearl Harbor until the surrender of both Germany and Japan in World War II. Despite this enormous period of time, the implementation of the law was still a disaster. If you recall, many provisions of the law were ignored and extended to later periods. Can something that took that long to implement be repealed and replaced in a few months?

3. In my last post, I quoted Daniel Kahneman on the how the human mind reacts to changes and reforms of the kind involved in repealing and replacing Obamacare. "Reforms always create winners and losers, and the losers will always fight harder than the winners." The losers in a repeal of Obamacare are sure to fight harder and shout louder than the rest of us. That you can count on. Look no further than upcoming GOP town halls if you doubt it.

Does any of this mean that President Trump and the Republican Congress should forget  about repealing and replacing this abominable piece of legislation? Absolutely not. In fact, I would argue that the GOP brand would suffer immense damage if Republicans do not follow through on their promise to repeal and replace Obamacare.

To navigate the rocky road ahead it is important to first set the stage and remind the American people of just how big an abject failure this legislation has been by explaining how far it has fallen far short of the promises that were made when it was passed.

That begins by repeatedly reminding the American people of the promises that were made that were not fulfilled.
    • It was not true that family health care costs would be reduced by $2,500 per year.
    • It was not true that everyone that liked their doctor could keep their doctor.
    • It was projected that over 20 million people would gain coverage through the healthcare exchanges in 2016. The actual number was half of this.
    • It was projected that Medicaid expansion under the law would cost $42 billion per year in 2015. The actual cost--$68 billion---over 60% above projections.
    • It was stated that insurers would offer multiple plan options because it would provide them with profitable business. A large number of counties across the country have only one health care plan option today. All but five of the large number of non-profits co-ops that were so widely heralded as an alternative to the profit-driven companies have closed and gone out of business. $2.4 billion of taxpayer money was used to fund these start-ups that is now gone. Billions of dollars of losses have piled up for the "for-profit" insurers.  Most are getting out out the Obamacare exchanges leaving no plan options from whihc to choose. United Healthcare exited most of the exchanges this year, Humana stated they will not participate in 2018, Aetna says that Obamacare is in a "death spiral." 
The Republicans should also not get too caught up with establishing an effective date of the repeal that risks creating turmoil. Yes, they should pass the repeal legislation quickly. However, the effective date might be a few years in the future. After all, it took the Democrats almost four years to implement this monstrosity. It may take a few years to totally unwind it. This may not be popular with Obamacare critics but it is the reality of the situation.

The fact that repeal is going to occur does not mean that the replacement plan cannot be implemented earlier. Perhaps the replacement plans compete alongside the Obamacare plans for a couple of years. The reality of the health care plan world is that if you want replacement plans up and running for 2018 the legislation needed to be passed YESTERDAY. I see no way there will be much of a chance to offer anything new for 2018 unless legislation is passed by the end of March. If Congress misses that deadline we are looking at 2019 at the earliest for any replacement plans.

It also has to be taken as a given that anything the GOP does is going to be criticized by the Democrats. They are also going to claim that the fact that the GOP is even talking about repeal is causing the demise of Obamacare. That could not be further from the truth, as the facts above show, but that will be the argument from Democrats.

Undoubtedly, the best strategy for Republicans at this point would be to merely step aside and watch Obamacare implode on its own. Sit on the sidelines until it was clear to everyone that it is irretrievably broken. This is not a viable strategy right now. First, the GOP made repeal the centerpiece of its political strategy the last few years. Second, it would simply be irresponsible from a public policy standpoint to see the havoc and harm that such an implosion would do to our health care system.

It is frustrating that the Republicans are not better organized on a repeal and replace plan. Again, it is much easier to talk than do. However, it is a very rocky road ahead to repeal. On this road it is better to be deliberate than rush down the road where a few bumps along the way could send you over the cliff for good.

The good news is that the Republicans are in the drivers seat on Obamacare. They just have to prove that they know how to drive.

Sunday, February 19, 2017

Understanding and Changing Minds

No two people better understood your mind.

Better than your spouse. Better than your mother. At times, even better than yourself.

Who were they?

Daniel Kahneman and Amos Tversky.

It is doubtful that many have ever heard their names.

These gentlemen changed forever the way that economists and others viewed the human mind and the way we make decisions. Until their groundbreaking studies, it was generally conceded that humans made rational and logical decisions with the brain acting like a sophisticated computer.

Kahneman and Tversky showed just how wrong that is. Their research showed in innumerable studies how the human mind errs in systematic ways leading to poor judgments, especially in uncertain situations.

The collaborative partnership of these Israeli-American psychologists is the newest work of best-selling author Michael Lewis. I just finished reading his account of how Kahneman and Tversky came to create the field of behavioral economics in "The Undoing Project."

I first became aware of the work of Kahneman and Tvesky about 15 years ago when I led the Benefits function of a Fortune 500 company.  In that role, I saw first hand how poorly our minds served us at times.

For example, despite the fact that everyone would probably desire (or be required) to stop working some day, when I assumed the Benefits role with my former company, only 50% or our employees were contributing to our 401(k) plan even though there was a generous company match.

In addition, despite the fact that the average employee had less than $500 in medical claims in a year, almost no one elected our high deductible medical plan in which they could save considerable sums in fixed payroll contributions for their coverage and place those savings in a health savings account.

In looking for ways to make our plans more cost effective for my company, and more valuable to our employees, I started searching for better ways to design our benefit plans. That research led me to the work of Kahneman and Tversky.

Everyone knows they need to save for retirement, but few save enough. Why do people ignore the logical response to save so they have money when they are no longer working? Kahneman and Tversky attributed this to what they called "availability bias". We excessively weigh in our minds those memories that are most easily available to us. We need food today. We need a new TV today. We need to take a vacation next month. These emotions outweigh the real needs we are going to have 10, 20 or 30 years from now.

You can see this for yourself in answering this short question that Kaheman and Tversky used in their research about availability bias.

Consider the letter K. Is K more likely to appear as the first or third letter in a word?

The typical person answered the first letter. In fact, they guessed that K was twice as likely to be the first letter than the third letter in a word. Kangaroo. Kite. Knee. Know. All of these easily came off of the top of my mind while writing this.

However, the fact is that K is actually twice as likely to be the third letter of a word compared to the first letter. Ankle. Take. Cake. Ink.  I had to look all of these up. They just aren't as available in the mind.

That is why when we redesigned our benefit plans so that we automatically enrolled everyone in the 401(k) plan as the default option and allowed employees to opt-out of the retirement contribution if they did not want to participate.

The result--92% participation compared to the prior 50%! We also later raised the contribution each year by 1% automatically unless they opted-out of the increase. Each year only 10% opted out. I wondered in my mind how far we could increase these savings increases before we saw a drop-off in participation. It honestly looked as if we could go on forever without any significant numbers opting-out. It takes effort to change and most of us limit our efforts. We don't like change.

That brings us to another bias in the human mind---the status quo bias.

We are extraordinarily loss averse. In fact, Kahneman and Tversky found that losses generally caused twice as much pain to us as an equivalent amount of gain brought us pleasure.

That is why high-deductible health plans were so difficult to introduce to our employees. A potential $500 out of pocket health care bill was more painful than the pleasure of saving $900 in premium contributions.

This is why reforms and changes are so difficult to implement. Look no further than what has happened with Obamacare. First, in the reaction when it was initially being adopted, and now when there is talk of its repeal.

That is also why the Democrats are taking their defeat to Trump so hard and their reactions are so irrational.

Kahneman explained it this way.

"Reforms always create winners and losers, and the losers will always fight harder than the winners."

We are seeing this play out every day in the news. Only the losers show up at town halls conducted by their Congressman and protest in the streets. The winners stay home content with what they won.

Another insight that Kahneman and Tversky developed was the process by which people make decisions. Decisions are often made by making judgments about similarity and about context. These decisions are often made by comparing features and classifications. Of course, since these are important in how decisions are made, they also can be manipulated to make a classification or feature seem more noticeable.

For instance consider this example from the Lewis book.

"If you wanted two people to think of themselves as more similar to each other than they otherwise might, you might put them in a context that stressed the features they shared. Two American college student in the United States might look at each other and see a total stranger; the same two college students on their junior year abroad in Togo might find that they are surprisingly similar; They're both Americans!

This is an instructive insight, especially as it relates to identity politics, most particularly by the Democrat party. They are very intent on grouping people into classifications for purposes of their political agenda---women, African-Americans, Hispanics, gays, etc.

The result of that grouping or classification is to overemphasize differences to the detriment of those similarities that we all share as Americans. It really becomes a divide and conquer strategy.

"Things are grouped together for a reason, but, once they are grouped, their grouping causes them to seem more like each other than they otherwise would. That is, the mere act of classification reinforces stereotypes. If you want to weaken some stereotype, eliminate the classification."

Isn't it interesting that Donald Trump has really focused on one message---"Make America Great Again". He has not focused on any other classification or grouping than that. Trump's issues are not black issues, white issues, women's issues, men's issues or anything else. The issues are those that are shared by all Americans. Jobs. Defense of our country. Crime on our streets. Homeland security.

Perhaps this is the reason he is seen as such a threat by the liberal Democrats. Everything Trump is doing is attempting to eliminate the classification and in so doing also weakening the existing stereotypes that fuel identity politics.

Kahneman and Tversky were psychologists who created an entirely new field of economics. In fact, Kahheman won the Nobel Prize in Economics in 2002. Tversky would have likely won his own Nobel Prize in the same field but for his untimely death in 1996.

Is a real estate business mogul doing something similar in creating an entirely new way of looking at politics?

Trump has changed many minds along the way to being elected. However, as we watch the daily news, he has many more minds that need to change to be successful.

My advice to Trump is the same as it is for you. Understand the way your mind works and those of your fellow human beings. To do that, learn more about the research of Kahneman, Tversky and others who have helped us better understand how our minds works, how we make decisions and how we can be misled.

Thursday, February 16, 2017

Hope and Change is Here

The mainstream media does not like him.

The political establishment does not like him.

The Washington bureaucracy does not like him.

Hollywood does not like him.

It seems that the only people that like Donald Trump are hard working people who pay taxes and make sure that the country works...and the people that provide the jobs and capital to help it grow.

We know it was those hard working people who provided the votes to elect Donald Trump President of the United States.

What about the jobs?

Small businesses are the source for 70% of job growth in the United States.

What do small business owners think about their prospects since Trump has been elected?

Take a look at this chart that graphs optimism by small businesses that is compiled monthly by the National Federation of Independent Business.

What looks like a rocket ship blasting off in the chart above began right after Trump's election. Small business optimism is at its highest reading in 13 years.

Business owners do not expand and add jobs unless they are optimistic about the future. Optimism portends increased hiring just as pessimism predicts job cutbacks.

Optimism is also reflected in stock prices. Capital is also necessary for job growth and expansion. Stock values and business results do not always match up in the short term. However, there is no denying that it is a barometer of economic optimism by investors in the short term.

Here is a chart of the Dow Jones Industrial Average over the last 6 months. The spike up in early November was the day after Trump was elected. The next significant move up began in late January right after Trump was inaugurated. Coincidence?

Dow Jones Industrial Average
Credit: Google Finance

You see a similar pattern with the S&P 500 Index.

S&P 500
Credit: Google Finance

Barack Obama campaigned on a slogan of "Hope and Change".

Everyone fell in love with the message, most particularly the media.

The irony is that Trump is actually delivering on providing real hope and change and the media wants us to believe that the country is falling apart.

Hope and change is here. When is the media going to start reporting on it?

Monday, February 13, 2017

Notes on NATO

One of the big reasons that Donald Trump was elected President was his willingness to speak about issues that most every other politician was afraid to talk about.

I wrote back in January, 2016 that this was Trump's greatest quality as a candidate. However, in speaking out he also is consistently inviting criticism by the political establishment.

"Trump sees things that others politicians see but they don't want to talk about it. He will talk about it, which is why he is frequently criticized."

The most obvious example was illegal immigration and the need to build a border wall (that Mexico would pay for!)

It is one of the things I liked about Trump from the very beginning even when he was not my preferred candidate for the GOP nomination.

Trump also raised questions about NATO that had many so-called "experts" stating that Trump did not know what he was talking about. His principal arguments have been that NATO is 'obsolete' in an age when terrorism has become such a big threat and that many NATO members are not paying their fair share.

In my view, Trump is exactly right. However, no one else had the courage to speak about it. Many NATO countries are facing enormous challenges from Islamic terrorism but NATO is totally focused on the threat from Russia. The NATO alliance needs to be revamped with this as an additional focus.

In addition, the fact is that most NATO members are taking advantage of the alliance (and in particular, the United States of America) by not paying their fair share of defense expenditures as they are supposed to as members of NATO.

In the late 1980's, NATO members spent, on average, 3.5% of GDP on defense expenditures. Last year, that number had fallen to approximately 1.5%.

The current minimum defense expenditure that a member country is supposed to meet as a percent of GDP is set at 2%.  However, only 5 out of 28 member states are meeting that target. Of course, the United States is doing much more than that meaning that most NATO members are getting a free ride from us.

This inequality is there for all to see but Donald Trump is the only one willing to talk about it?

And he is then criticized for it by those who say he "doesn't understand" and is putting Europe in danger?

The main purpose of NATO from it inception was for the member countries to defend each other from the possibility of the communist Soviet Union taking control of their nation. Who is more at risk of this occurring---the European countries who are NATO members or the United States?

It would seem since the Europeans are the most at risk that they would be more than willing to pay the bill to defend themselves. Why rely so much on the United States? Is that fair? That is the main point that Trump is arguing.

Let's look at the current scorecard of NATO countries and see what each member is contributing to its defense as a percent of its GDP.

Credit: The Daily Shot

The United States is spending 3.61% of GDP on Defense which is well over double what the average NATO member is doing. Poor Greece is next at 2.38% The U.K., Estonia and Poland are the only other countries meeting the 2% target.

France is spending 1.78%. Germany 1.19%. Denmark 1.17%. Italy 1.11%. Canada is not even spending 1% of its GDP on Defense.

The political establishment and mainstream media wants you to believe that Trump is off base in his views about NATO. When you see these facts, what do you believe?

Thursday, February 9, 2017

What is a Fascist?

Donald Trump is a fascist.

Steve Bannon is a fascist.

Tea Party Republicans are fascists

I doubt that not one in hundred people can give you a proper definition of "fascism" or "fascist".

Certainly not the people that overuse or misuse the term.

For example, here is what MSNBC's Rachel Maddow said about Trump.

She should know better. Maddow is a graduate of Stanford University and was a Rhodes Scholar. I guess she just can't help herself.

Benito Mussolini is generally credited with developing the fascist ideology in Italy. He ruled Italy under the mantle of the National Fascist Party beginning in 1922 through World War II.

Since Mussolini founded fascism it would seem to make sense to see how he defined it. You can read the complete "Doctrine of Fascism" as written by Mussolini in 1935. It is the most complete articulation of Mussolini's political views and the ideology of fascism.

A few key excerpts so you understand the core concepts of fascism quoted directly from the Mussolini text.

1. "The Fascist conception of life stresses the importance of the State and accepts the individual only in so far as his interests coincide with those of the State."

2. "The Fascist conception of the State is all embracing; outside of it no human or spiritual values can exist, much less have value."

3. "Fascism, is totalitarian, and the Fascist  State  - a synthesis and a unit inclusive of all values - interprets, develops, and potentates the whole life of a people."

4."For Fascism the State is absolute, individuals and groups relative. Individuals and groups are admissible in so far as they come within the State."

5. "The concept of freedom is not absolute because nothing is ever absolute in life. Freedom is not a right, it is a duty. It is not a gift, it is a conquest; it is not equality, it is a privilege.

6. "The Fascist conception of life is a religious one, in which man is viewed in his immanent relation to a higher law, endowed with an objective will transcending the individual and raising him to conscious membership of a spiritual society. "

You can see from the above that there is not a lot of difference between fascism and communism in their absolute reliance on the State and the severe limitation of any individual rights. In fact, you can argue that fascism and communism are actually subsets of socialism.

The primary distinction is that in communism the state also owns all elements of production and controls the distribution of income whereas fascism is open to private ownership as long as it is subject to total state control. In a fascist regime, "all within the state, nothing outside the state and nothing against the state" is what matters.

We can identify communist regimes fairly easily--the former Soviet Union, Cuba, North Korea, Venezuela.

When you speak of fascism most think of Nazi Germany or Mussolini's Italy. However, Iran, Saddam Hussein's Iraq and many Middle Eastern countries would also seem to meet the definition.

Taking all of that as context, this is how Merriam-Webster defines fascism.

Interestingly, Google defines fascism in a different way.

Google has decided that fascism is only a "right-wing system of government" represented by the "extreme right-wing".

You have to wonder how Google came to that conclusion?

Answer the following questions for me.

Who is most in favor of a large federal government and bureaucracy?

Who is most in favor of federal vs. state and local solutions to problems?

Who is most in favor of extensive economic regulations?

Who is most in favor of pushing government edicts irrespective of religious rights?

Who has been most aggressive in attempting to limit individual rights such as the right to bear arms, freedom of religion and free speech?

Who has proven to be the most militant in attempting to suppress opposing views?

It is not the right-wing.

It is not Donald J. Trump.

It is the liberal left.

I am not saying that liberals Americans are fascists. Far from it. The point is fascism is not an ideology that is left-wing or right-wing. Fortunately, our U.S. Constitution is perfectly constructed to protect us from fascism in all its forms with its separation of powers, Bill of Rights and limits on federal power. There should be no concerns about any fascism taking hold in this country as long as we continue to honor and uphold the Constitution.

What is truly troubling here is that with the power that Google has, its definition of fascism is always going to come up first on any search of the term "fascism".

Google refers to an autocracy as a synonym for fascism. This is how they define that term.

Notice the last bullet point.

  • domineering rule or control

What is Google's power over people using the internet?

Google needs to be much more mindful of its power and influence. It also needs to be more responsible in not letting its political views color the fair dissemination of information without bias.

Is it any wonder we are calling our fellow Americans fascists?

Too many simply do not seem to understand what it means.

Including Google.

(Hat tip to BeeLine reader Ron R. for bringing the Google definition to my attention.)

Wednesday, February 8, 2017

Manipulation Media

It is hard to pick up a newspaper, turn on a radio or watch television and not be bombarded with reports of how unhinged and unpopular President Trump is.

In story after story that is the incessant message from the media. It has been a steady drumbeat since Trump entered the race for President.

In the immediate aftermath of President Trump's executive action to temporarily suspend the granting of visas to enter the United States from seven unstable countries that have terrorism histories I drove 500 miles across the southeastern United States. I heard story after story on the radio as I drove about the numerous protests against this "unprecedented action." However, in all that travel I did not see one protestor or protest sign. I have not seen one in the two weeks since either. I doubt you have either.

If we have learned one thing from the 2016 election it is how deeply invested our media institutions are in promoting the liberal, progressive agenda. Of course, by corollary, that also means doing all they can to destroy any alternative agenda. I knew there was bias. I knew there was an agenda. However, the scope and scale is beyond anything I could have imagined.

It is as we are living in a parallel universe. The universe the media has constructed that they believe we should be living in. And the universe that we know that we are actually living in. Most of media is no longer reporting the news. They are more focused on manipulating the public into believing what the news should be.

You can better appreciate this when you look at this poll that surveys voter opinions on all of the significant executive actions that President Trump has taken in his first two weeks in office.

If you have been paying attention to what the mainstream media is "reporting" you would think that each of these actions is overwhelmingly unpopular with the American people. In fact, you would probably think that you were the only one in America who was supporting what Trump was doing.

However, on every action Trump has taken, a significant majority of Americans support what he has done, according to this Morning Consult/Politico poll that was released today. Sanctuary cities. The terrorist country visa suspension. The border wall. Obamacare. Keystone XL Pipeline. TPP.

Majority public support exists for every Trump action.

It is all the more remarkable when you consider the media manipulation that has attempted to portray all of these actions to be out of the mainstream. Yet, the American people are showing a remarkable ability to see the media manipulation for what it is.

In looking at the temporary suspension from predominant Muslim-terrorist countries, I also found this survey by Chatham House of 10,000 European people in ten European countries on this subject interesting.

It shows that 55% (coincidentally the same percentage approving of the Trump action in the U.S.) believe that "all further migration from Muslim countries should be stopped."

Chatham House called the results as "striking and sobering."

Sobering? Perhaps it is just a sane response to what these people are seeing in their world.

The same could probably be said for the reasons behind the public approval of Trump's actions.

The more the media tries to convince us we are insane, the more we understand that the opposite is what is true reality.

Monday, February 6, 2017

Comeback, Collapse or Choke?

Last night's Super Bowl will be remembered as one the most memorable in history.

Will it be remembered as a comeback for the Patriots or a collapse or choke by the Falcons?

It is never an easy question when sports are involved. Unfortunately, I have too much personal experience myself in what happened to the Falcons last night.

As I saw Matt Ryan get sacked and fumbled the ball as he attempted to throw a deep ball (why was he passing on third and one? if they wanted to pass why not a quick route rather than attempting to throw deep ?) with 8 minutes to go and leading by 16 points I turned to Mrs. BeeLine and said, "The Falcons are going to lose this game."

I knew. I have been there before.

My alma mater, Miami University was up by 2 goals over Boston University in the NCAA National Hockey Championship game with one minute to play in 2009. They gave up 2 goals in that last minute and then lost in overtime.

My son's college lacrosse team was up one goal with less than two minutes to go in their conference championship game his sophomore year and had a two-man advantage due to penalties called on the other team. They lost the ball and the other team scored on a fast break with less than 30 seconds to go in the game. They lost in overtime.

Over 25 years ago I was 1up in a golf match in my club championship (first flight) after birdieing the 17th hole. The 18th hole was a difficult finishing hole that required a 180 yard carry over water and the water also went up the entire left side of the fairway. I split the fairway with my drive and saw my normally steady opponent hook one into the water on the left. He was choking. I thought the match was mine.

My opponent was able to take advantage of a drop area on the other side of the water between the tee and fairway but still had over 200 yards to the green. He got his third shot about 20 yards short of the green and I was sitting in the middle of the fairway with an 8-iron in my hand confident the match was over. I hit a solid shot but it starting drawing to the left of the green dangerously close to the water that bordered the green. It bounced twice and then went dead left into the water.

I am now laying three after the penalty but I am only about 20 feet from the pin compared to my opponent's 20 yards. You can guess where this ended. My opponent gets up and down for a bogey 5. It takes me three shots from 20 feet for a double bogey. You would also be right if you guessed that I lost the match on the first playoff hole. It still hurts after more than 25 years. I am sure it will still hurt after 50 years.

I have no doubt it will be the same for the Falcons who played in that game.

Why do these collapses (or chokes) occur?

It is one of the eternal mysteries of sports. How can someone be breezing along for an entire game, or match, and suddenly lose it?

I have written about Matthew Syed and his book, Bounce, in these pages before. Syed wrote Bounce to explain what he believes to be the science of success.

Syed knows something about success.  He was the top-ranked table tennis player in the UK and is a two-time Olympian as well as a graduate of Oxford University. You might say that he is a talented young man. Syed would say to you that talent is not what you think it is. In fact, he thinks it is highly overrated.

What most people call talent is really just hard work.  It is about toiling and training for long hours. Practice, practice, practice. Nothing more.

Syed became interested in the topic after thinking about his own success...and his failure. In his own words, Syed "choked" in the Olympics.  Those experiences led him to explore the science of success as well as the science of choking.

In his view most success in sports comes from toil and training. Endless hours of developing the right muscle memory. You don't think. You just do it. The training makes it automatic.

Of course, it is automatic until it isn't. And that time usually comes when the stakes are high and the pressure mounts. Instead of doing it, you start to think about it. And when you are thinking, you are not doing it the way it is natural to you. The way your muscle memory remembers it. You start to overwhelm your muscle memory with your brain.

It doesn't have to involve sports either. You walk and talk every day. It is automatic. You don' think about it. However, what if you have to walk down a runway modeling clothes in front of 1,000 people. Or give a speech in front of 10,000?

Thinking too much is inimical to success in many situations.

Through three quarters of the game last night the Atlanta Falcons played their game. They were leading by 19 points with 15 minutes to play.

It is probably fair to say that as the fourth quarter began the Falcons began to first think about what they were on the brink of achieving. It was all downhill from there.

How do you avoid choking?

Don't think about it. "Just do it" as Nike would say.

How do you just do it?

Practice. Practice. And more practice.

Of course, how do you practice leading the Super Bowl?

You don't. It was something that the Falcons simply could not do.

However, the Patriots had been there before. They had the experience of being there and doing it.

Had the roles been reversed, there is no way the Patriots would lose. They had been there before. They would not have been thinking as much about winning as the Falcons.

Experience is worth as much as practice.

That is why the Patriots won and the Falcons lost.

Practice promotes perfect. Experience enhances execution.

A great comeback made possible by a monumental collapse.

May the Falcons be more fortunate in the future.

May I be so fortunate to forget about a shot I missed over 25 years ago.

Thursday, February 2, 2017

The Worst Is Yet To Come

No matter how heated and hostile the Democrat reaction to the Supreme Court nomination of Neil Gorsuch may become, it will be nothing compared to what we will see if President Trump has the opportunity to make a second appointment.

It would seem to be better than a 50-50 bet that he will get that chance when you consider the ages of the current Justices on the Court.

Ruth Bader Ginsburg will be 84 years of age in a little more than a month.

Anthony Kennedy is almost 81.

Stephen Breyer will be 79 this year.

It is one thing for Gorsuch to fill the seat of Scalia. Other than Clarence Thomas, Scalia was the most ideologically conservative member of the Court as the chart below from FiveThirtyEight demonstrates. It projects that Gorsuch would be roughly similar to Scalia in how he views the law.

In effect, it is more or less a one for one trade for Scalia in the makeup of the Court as it existed before Scalia's death. It really is not a game changer on the makeup of the Court we have seen in recent years.

However, it will be an altogether different situation if Ginsburg, Breyer or Kennedy would need to be replaced.

Just consider the impact on the Court if Ruth Bader Ginsburg could potentially be replaced with another jurist with a similar ideological makeup to Scalia, Thomas or Gorsuch?

Whatever you see playing out over the next couple of months with Gorsuch will be nothing compared to what we will see should Ginsburg's seat open up.

The nomination of Gorsuch by President Trump is already getting liberals concerned about Ginsburg's health.

Consider these comments from several committed leftists in this story from The Washington Post that was picked up by SF Gate, "Can she eat more kale? Hordes of liberals want reassurance of RBG's health"

"I'm very interested in this." says Jeanette Bavwidinski, a community organizer in Pennsylvania. "I'm interested in what her daily regimen is. Like, what are you all feeding RBG? Is she getting enough fresh air? Is she walking? Is she staying low-stress? What is she reading? Is she reading low-stress things?"
"Can she eat more kale?" asks Kim Landsbergen, a forest ecologist in Ohio. "Eat more kale, that's all I can say. We love you. Eat more kale.
Concerns about Ginsburg's health are not unwarranted in that she has already survived both colon and pancreatic cancer.

You may also remember this photo of Justice Ginsburg at President Obama's 2015 State of the Union Address. I guess you could say she was not enthralled by what she heard that night.

Credit: YouTube

Many of the left are unhappy with Ginsburg that she did not retire when Obama was President so that he could appoint a successor. However, in her defense, I don't think she ever considered the possibility that Trump would be President.

If you recall, she said this about Trump in an interview with The New York Times that she later recanted and apologized for after receiving strong criticism from all sides.

I can’t imagine what this place would be — I can’t imagine what the country would be — with Donald Trump as our president,” she said. “For the country, it could be four years. For the court, it could be — I don’t even want to contemplate that.”
It reminded her of something her husband, Martin D. Ginsburg, a prominent tax lawyer who died in 2010, would have said.
“Now it’s time for us to move to New Zealand,’” Justice Ginsburg said, smiling ruefully.

Perhaps Ruth Bader Ginsburg could not imagine it but it is the reality now. It also probably explains why Ginsburg, Breyer and Kagan all are using a personal trainer according to The Washington Post story. However, it does not tell us whether she is eating kale. 

One more chart is worth looking at for all those who suggested that Merrick Garland was a "centrist" and that Obama went out of his way to nominate a candidate who should have been acceptable to Republicans.


This is how The New York Times assessed each of the justices on the ideological spectrum together with how they saw Garland lining up.

This may be how The Times defines a centrist but it looks nothing like a centrist to me.

Considering all of this, it points to the fact that the Gorsuch nomination is merely the preliminary bout. The main event is yet to come.

I have no doubt that the Democrats will throw everything they can at Gorsuch but are they willing to impede the nomination process such that the GOP will need to employ the so-called "nuclear option"
and force a mere majority vote in the Senate rather than the super-majority 60 votes?

They may be unhinged enough to do it but I don't think it would be smart on this nomination. Doing it now on a pick that doesn't really change the balance on the Court seems short-sighted. It would seem better to wait until the stakes were larger if you were a Democrat.

The worst is yet to come.

For Democrats.

And, unfortunately, for all of us who have to look at these spectacles in Washington.