Socialist Obama: It Could Be

By Tom Graham - Part 2 (Editor: Graham continues his brief, begun here, for specific policy evidence of President Barack Obama's socialist ideals and intentions.) Another one-two level economic mainstay, the construction industry, especially housing, is also an Obama target. Control of housing is cleverly approached from different angles. The issue of increasing traffic congestion makes public transit projects popular. However, the moving of people without autos is only an incidental byproduct of “transit oriented development.” This features aggressive campaigning by advocates of very high-density, heavily-subsidized housing. Although this was around before the emergence of Obama, it was announced during the Democratic Convention that the attack would now be aggressively pursued. Various groups connected to the “Progressive” movement see this as a step in control and Socializing of housing.

Good to their word, the Obama administration announced in mid-January that priorities for transit project funding would be based on the level of development opportunity created. The criteria of reducing travel time would be rescinded. Can everyone out there spell “Socialized housing?”

Many real estate brokers will recall implement-ation of the Community Reinvestment Act, whereby they were urged, sometimes threatened, to direct minority buyers away from “ghetto” enclaves, ostensibly for the goal of integration. Radical activist Saul Alinsky campaigned for implementation of the Act with the hope that it would lead to the crippling of banks, overloading of welfare rolls, and disruption of local governments. This strategy was taught to ACORN volunteers by Obama. The policy required brokers to abandon the universal practice of qualifying buyers by verifying enough income to afford the expense of home ownership. Brokers were instructed to direct buyers to certain lenders who package risky “sub-prime” loans into incorporated instruments with phony high ratings. Brokers and bankers had lived through the sub-prime underwater loan fiasco of the 80s, and the incredible incompetence of Resolution Trust, which was organized to dispose of the millions of HUD-foreclosed properties.

Astute brokers and investors predicted that resurrection of sub-prime lending would flood the market with homes having more debt than value. Few realized it would total trillions and cause the current national financial disaster. This contrived “crisis opportunity” paves the way for Socialist takeover. People without adequate income, encouraged by liberal policies to purchase homes, will build little equity and lack pride of ownership. They become ripe for Socialized housing. We haven’t met anyone who doesn’t consider the sub-prime market to be the cause of the current recession. Nor are there many who don’t believe this crisis to be a forerunner to government interference with housing and the construction industry.

The debacle hasn’t discouraged more of the same. Lenders are scraping the bottom for unqualified buyers and aggressively advertising loans of 105%-110% of value. An example of the market: 65% of all Nevada households owe more than their home’s value, according to American CoreLogic. Three days after Christmas, Obama gave blank checks to Fannie Mae and Freddie Mac without announcing any strategy, encouraging speculators to pour money in. Analysts consider it money down a rat-hole.

FHA guaranteed a quarter of all US home loans in ’09, having learned nothing from the 80s. For the first time in history cash reserves are below the Congressional stipulated minimum. The government has taken over 80% of Fannie and Freddie, and will take the remainder after the forthcoming complete failure, which in turn will lead to complete control of the housing industry, in contrived Communist style.

Obama has blamed loans that couldn’t be paid back for the crisis, although the architect of sub-primes and long-time Fannie Mae chief Franklin Raines, is one of his economics advisors. It should also be well noted that as general counsel for ACORN, Obama sued banks to force them to make loans to low income buyers.

The President views health insurance as a right, and as an egotistical personal goal, worth political risks. In all the thousands of incomprehensible pages of proposed legislation, there lurks the “public option.” Make no mistake about this, titled “affordable choice,” being the entire motivation behind the issue of health care reform.

First of all, this is a classic case of manufacturing a problem and selling a solution to the non-existent situation. The 47 million uninsured hype is a count of everyone who may be without a policy for as little as one day during a year. Subtract the young and healthy who can afford insurance but choose not to have it, and those in the country illegally, and the figure is 5 million. Of course the “pathway to citizenship” for illegal aliens makes them eligible for health care entitlement.

Accounting for one-sixth or one-fifth of the economy, depending on who does the calculation, it is an essential element of the Socialist movement. Little intelligence is needed to see that private health care providers and insurance firms cannot compete with subsidized government programs that have no bottom line commitments. Consumers rationally choose the cheaper. The public is told that creates competition that will drive costs down. At the same time, they oppose the ultimate competition of an interstate market, because that would stall Socialization.

A key element of the confusing legislative mess is a federal subsidy for most people’s insurance. The fine print reveals that this will not take effect until 2014. Legislation calls for mandatory purchase of specified insurance to force everyone out of their chosen policies. Willful failure can result in a $25,000 fine and a year in jail, or $250,000 plus five years in jail for felony evasion. People who want additional, more costly “Cadillac” plans will be taxed. Preferential deal-making by Obama provides exemption from the tax for union members, who constitute the majority of “Cadillac” plan holders, as well as an Obama voter base.

Obama’s press secretary advised us after Christmas that the administration’s goal was to stop plans where employees are given better than average insurance plans as part of their compensation. Those considered excessive by Obama czars would be eliminated. Articulating Obama’s position, Speaker Pelosi stated that health insurance companies are the problem, and there would be a crackdown, including a requirement that they spend 85% of their revenues on benefits.

A temporary back-off to mollify the skeptical popular majority, calls for the private companies to participate in “non-profit” plans. If there is foot-dragging, the public option will be triggered. The trigger is a foregone finality. This is one major segment of the economy that could start out as Communist with the intent to make it Socialist. A feature of all plans is the requirement that people cannot be denied membership because of pre-existing ailments. This would be like insuring your car after an accident. In other words, health insurance becomes a Socialist redistribution of wealth.

Of course with the possible loss of a filibuster–proof Senate, “Obamacare” it is not a done deal. The closed-door meetings, taking the place of traditional open bi-cameral conferences, have so-far failed to produce Congressional agreement. The administration may ignore political repercussions and fight for this ultimate command-and-control segment of government, while ignoring the lack of Constitutional provision for any of it.

A major element in soaring medical costs, frivolous lawsuits, could be corrected with tort reform. However, this has been carefully sidestepped at the direction of trial lawyers, who are the second largest contributors to the Democratic Party.

A big step toward Socialized medicine is the proposal to reduce Medicare age to 55 or lower. Where the money comes from is anybody’s guess. Taking $500 billion out of one Medicare pocket and putting it into the other pocket is the plan to help pay for it. The SCHIP “children’s program,” insuring people up to age 25, and as old as 37 in some cases, and covering many who are financially sound, is another inroad to Socialized medicine.

You have noticed the TV ads endorsing reform. These are part of a sweetheart deal with Obama, who promised favors to the drug industry in return for a $150 million ad campaign, paid for by pharmaceutical firms. With monumental hypocrisy the left demonizes the drug industry, while simultaneously taking their money.

Columnist and self-styled economist Paul Krugman has announced that Obamacare critics are the “lunatic fringe.” He added, “…now that (Republican) policies of tax cuts and deregulation have led us into an economic quagmire, their prescription for recovery is…tax cuts and deregulation.”

A recent metaphor likened the Socialist health insurance takeover struggle to the Greek myth, where Sisyphus is condemned to push a boulder up a hill for eternity. Although Obama may temporarily pull back after the Massachusetts message, we cannot envision abandonment of this capstone of his first year whether he is a Socialist or a Communist.

Socialist Obama: Could it be?

By Tom Graham - Part 1 During a recent “Meet the Press” the host, with feigned indignation, asked a Senator, “You’re not calling the President a socialist, are you?” Without waiting for a response, he repeated the question for emphasis. This performance highlights the hijacking of political semantics. “Socialist” was replaced by “Liberal” which, in turn, became a pejorative, and now “Progressive” is preferred, and used in titles of dozens of political and welfare advocacy groups. Constantly morphing ideas and permutations of definitions make it hard to compartmentalize politicians. An accepted basic view is that Socialism advocates state or collective ownership of the means of production and distribution of goods. That essential hallmark of freedom, private ownership of property, is prohibited. Note how the current abuses of eminent domain stretch the traditional definitions of public use.

Marx called Socialism a transition between capitalism and Communism. As any high school sophomore should be able to recite from Marx’s Manifest der Kommunistischen Partei, “To each according to his needs; from each according to his ability.” An advocate of these ideas is indeed a Socialist. To quote National Socialist German Workers’ Party leader, Adolph Hitler, “The needs of society come before the individual’s needs.”

Before labeling Obama and his inventory of actions, we must also note the academic definition of Communism. “All economic activity is controlled by the state, dominated by a single political party.” Further: “A system based on holding all property in common, with actual ownership by the state.” Differences between the categories, reduced to simplest form: Socialism actually takes ownership while Communism totally controls enterprise, which ostensibly could remain private. This administration’s actions overlap both, with the common goal of doing away with Capitalism. Degrees of success are temporarily limited by public resistance. Constitutional protections are rejected as archaic annoyances.

Obama, equipped with glibness and arrogance, was dismissed as a buffoon by serious economists. His experience was largely limited to preaching Alinsky to ACORN volunteers. Without apologies, he surrounded himself with cabinet and advisor appointees, and a cadre of czars with no accountability, most of whom have serious ethical, legal and moral taints. The czars have no Congressional approval. Uniformly visible in that group is the disturbing tendency to demonize the concepts of private property ownership and free markets. The last 18 presidents averaged 46% of their advisers from the private sector. Obama has 8%.

As perennial presidential candidate Norman Thomas, and others, famously said, “The American people will never knowingly adopt Socialism. But under the name of ‘liberalism’ they will adopt every fragment of the Socialist program, until one day America will be a Socialist nation without knowing how it happened.”

Fabianism (strategy of establishing Socialism by gradual means), used with patience by subversive movements world-wide, is not in vogue with this administration.

To some degree or another, The administration has addressed all the elements of the Socialist or Communist state, with varying degrees and a common thread of shrinking Capitalism with alarming speed. The advice of Obama mouthpiece Rahm Emanuel is, “Never miss an opportunity to take advantage of a crisis.” Tactics of Chicago-style patronage, populism and corruption, unabashedly taken to the national level, have caught many flat-footed.

To correct what he blames his predecessor for, “long years of drift,” Obama is moving to control major industries in Communist fashion. What better start than the showpiece of American industry for a century, automobile manufacture? The President has no desire to own the auto companies, merely to control them. Perhaps he has read of the disastrous Soviet attempts at controlling manufacture with bureaucrats making all decisions.

Obama wants control while allowing experienced management to take care of the details. Bailouts of General Motors and Chrysler certainly were never meant to be loans, but rather a grab of equity. The action instantly took 78.3% of General Motors by the government, followed by a gift of 17.5% to the auto workers union. Bond value was whittled down to maybe 10% of GM equity. Investors without rational recognition of Communist control strategy held out hope for a rebound.

A sidebar of the auto industry takeover was the “Cash for Clunkers” fiasco which, at taxpayer expense, amounted to a marginal cost per car of $24,000. It had an effect of about 32 thousandths-of-one-percent CO2 reduction. It stimulated car purchases at the expense of future business a few months down the road. For example, by the end the year, Colorado new car registrations were 29.8% less than last year.

Face it, FasTracks is a failure

RTD presents five FasTracks options to the public. All are permutations of the original plan, ranging from shortened lines and curtailed service, to the full system. Mentioned with muted voices are possibilities of a 2034 completion date, and the 67% tax increase approved in 2004 becoming a 116.67% increase. More federal grants will be requested. This would also fall short, even in a mild recession.

The original 0.6% tax thirty years ago (!) was authorized with the stipulation of providing rail. None was built. Recognize that sales tax increases hurt business. Taking billions out of the economy is recessionary.

The project is currently $3.2 billion over budget, with $2.8 billion tax revenue shortfall anticipated. There’s the matter of each community being assessed 2% of the cost. Most communities have no idea where this is coming from. Some say, “in-kind services.” Mysteriously, this recently became 2-1/2%. Look for a local tax increase. The Federal share could build all the highways we need.

The economic downturn and rising materials costs are blamed. Many other major projects are progressing. There was intentional low-balling and ignoring of associated items, to make the project more attractive. Add a generous serving of incompetence.

Continuation of these rail options is a distraction from proven transportation solutions. Original RTD and Denver Regional Council of Governments (DRCOG) studies ranked rail as less efficient than bus rapid transit (BRT), in terms of speed, frequency, flexibility, capital cost, and operating expenses. All recent US General Accounting Office (GAO) Reports to Congress reinforce this. Rail projects across the country are financial disasters with declining ridership. Only one city, New York, has a rail system that carries as much as one freeway lane.

FasTracks was conceived as a response to traffic congestion. DRCOG forecast a negligible 0.43% reduction by the target year, with consultants predicting zero effect. Note that transit oriented development (TOD), catchwords for liberal urban planners, invariably causes sub-regional traffic congestion. Recommendations are made for nearly 30 times the typical suburban density, requiring high rise buildings. Suggestions are made for forcing people to use rail and live in TODs.

Much of the impetus for the project comes from land speculators who profit by obtaining local council high density approvals. Eminent domain abuses are inflaming the public.

Proponents admit that the project is a fiasco, progressing because of voter approval. Voters were given the choice between a rail project, or no project. The ballot offered no choices or comparisons of proven alternate modes. Voters were asked to choose the most costly project in Colorado’s history on the basis of feel-good slogans. Public comment is limited to minutiae… bicycles on trains, toilets in stations…with basics avoided.

Why continue the fiasco? RTD recently let a $184 million no-bid contract, after learning that the contractor has been involved in massive bribery scandals. Audit reveals their $2.3 billion slush-fund for “questionable transactions.” $543,000 in political contributions were made by contract recipients. RTD's manager has an annual half-million package, and his city councilor wife is involved in TOD approvals. It’s called wiring contracts by “pay-to-play” manipulators. Firms making six-digit contributions expect, and receive, contracts.

Existing Denver rail runs at 10% of capacity, as compared to nearly 40% nationally, and with many riding because of curtailed bus service. FasTracks will increase air pollution and create 138 grade crossings and 2,000 dead ends, seriously hampering emergency vehicle response.

This project is a dog and should be repealed.