He is . . . not a genius : “The one thing we are going to do during this work period, sooner rather than later, is to ensure that women’s lives are not determine by virtue of five white men,” Reid said. “This Hobby Lobby decision is outrageous and we are going to do something about it. People are going to have to walk down here and vote.” The Hobby Lobby was written by Samuel Alito, joined by justices John Roberts, Antonin Scalia, Anthony Kennedy . . . and Clarence Thomas. Who is still black.

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Harry Reid: Hobby Lobby Result of Those “Five White Men” on the Supreme Court

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Jay Carney Clarifies

On July 3, 2014, in Barack Obama, by IWCDeboraydzg

[guest post by Dana] Former White House press secretary Jay Carney reveals a few choice gems as he looks back at his time at the podium… You came to the administration from Time magazine, where, for a while, you covered the White House. How did your view of journalists change when you switched sides? I’m proud of a lot of my work. But if I had known then what I know now, I would have succumbed less often to chasing the same soccer ball down the field that everybody else was. Are you saying they’re shallow? I think the format reinforces a shallow approach. Were you surprised at times how tense things could get with your former colleagues? Sure. It can be surreal at the podium when you go down that front row and you have an exchange with one of the reporters in which there’s very emotional — maybe even theatrical — presentation and back and forth, and then you go to the next reporter and you have the same thing, as if the first one didn’t happen at all. You begin to wonder how valuable a service to the nation that is in the end. Do people in the first row like to showboat? If you look at the difference in tenor between the on-camera briefings and the on-the-record-but-off-camera gaggles, it’s night and day. One serious accusation that has come up throughout your tenure is that this is an Orwellian administration, the most secretive ever. I know — because I covered them — that this was said of Clinton and Bush, and it will probably be said of the next White House. I think a little perspective is useful. What I really reject — and would have rejected as a reporter covering this place — is this notion that whether a reporter is successfully doing his job depends on information he is being handed through the front door from the White House. But won’t all these leak investigations produce a chilling effect? Len Downie [the former Washington Post editor] sat in this office as he was preparing a report about how we were producing a chilling effect, and I was able to take a copy of The Post and drop it on the table and point to yet another unbelievable national security leak. Reporters are still able to get stories and information that the administration clearly does not want them to have. More at the link, including the “asset” that is Joe Biden and his unfiltered mouth. –Dana

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Jay Carney Clarifies

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As I mentioned yesterday, I am spending time this week attacking GDP as the ultimate benchmark for measuring the strength of the economy. Yesterday, in Part One of the series , I noted that GDP includes government spending even though government spending does not necessarily benefit consumers. Today, I want to address another problem with GDP: it overemphasizes consumer spending to the detriment of capital investment . I am going to give you the same video I showed you yesterday, featuring Austrian economist Jeff Herbener, interviewed by Tom Woods. If you are short on time, skip to 4:55, where Prof. Herbener notes that GDP indicates only the value of the final goods and services produced. GDP is generally defined as the market value of the final products of an economy, including goods and services. But GDP does not measure all economic production. There is an entire production process that goes into the production of any good, whether it be a consumer good or a capital good. This does not get included in the calculation. For example, when a car is sold, the price of the car is included in GDP. Economists do not include, for example, the cost of the steps in the production process that provide the building blocks for the car — such as the mining of iron ore, the production of steel, or the machinery and computer modeling that serve to transform that steel into the skeleton of an automobile. The reason is that the final price of the car is thought to represent the cost of all stages of production of the automobile, ideally together with a profit for the company. If one counted the value of the production process and the cost of the car, it is said, that would represent “double counting” of the costs of the production process. That’s fine if your only goal is to learn the final value of the good. But leaving the production process out of the equation, and including only purchases of final goods and services, distorts the significance of the total . That’s because eliminating the work that goes into making the product gives an outsized significance to the act of purchasing that final product. As Professor Herbener has elsewhere explained : If all one is interested in determining the the dollar value of all that has been produced in the economy, then, counting the steel, and other parts of the car along with the car would be double counting. But the dollar value of what has been produced in an economy is, perhaps, the least interesting thing we could know about it. If we really want to understand an economy, we have to know how all the different resources people have get allocated into all the different production processes. The monetary value of all production tells us nothing about this. . . . . When we trace back the production of consumer goods to their sources, then, we see that the amount of demand entrepreneurs have for all the producer goods necessary to make some consumer good far outweigh the demand consumers have for it. In other words, the far greater portion of production in an economy is of producer goods , which is explained by entrepreneurial demands, which results in investment spending. Consumer demands and consumption spending are a far smaller portion of all demands and total spending and the production of consumer goods is a smaller portion of the production across the entire economy. By excluding the cost of production processes from GDP, economists overemphasize the importance of consumer spending. Based on measures of GDP, we are told that consumer spending is 70% of the economy, and that investment is only 15% or even as little as 10%. But that is radically wrong . That may be true when it comes to the value of the final goods. But those goods did not come out of nowhere. They had to be produced. Tom Woods recently interviewed an economist named Tim Delmastro who successfully lobbied the government to provide a number called “gross output.” This number measures spending at all stages of production — a concept central to Austrian economics. As Delmastro notes in the interview, the GDP number consists of consumer spending (70%) and government spending (20%) with business investment coming up as a distant third. This misleads people into thinking that increasing consumer spending is the most important thing to do in the economy. But when you measure “gross output” and get a more accurate picture of the economy, you learn that consumer spending is only about 30 to 40% of the economy, while business investment is actually over 50% of the economy . (The “gross output” number is actually quite poor under Obama, by the way. Shockingly.) At 8:21 in the video below, Woods makes the killer point that drives this point home: we are always told we need more consumer spending. If we followed that advice and took it to its logical conclusion, everyone who receives money for a good or service should just go spend it on consumption. As Woods says: But meanwhile, people are told, or are under the impression, that what we need is more consumer spending. Spend spend spend spend. But if we followed that advice . . . to a “T,” and everybody, as soon as he got money, just spent it on another consumer good . . . let’s say you buy ten gallons of milk from me, and I take that money and I buy a shirt, and the shirt guy buys a hat, and the hat guy buys a gallon of gas . . . then no wages get paid [and] all the production structure we just described grinds to a complete halt. But that would be Nirvana, because you have all the consumption you want! Woo-hoo! Tomorrow, in part three of the series, we identify the basic problem with GDP. Namely: it does not measure what we should be most interested in when we study economics: how to allocate scarce resources. See you then. P.S. Once again: if you choose to sign up for Woods’s “Liberty Classroom” to learn more about concepts like this, please do so though this link . Do yourself a favor and at least check out Woods’s free samples to see what you think.

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Consumer Spending Is Not the Most Important Part of the Economy — Why Paul Krugman’s Love of GDP Is Wrong, Part Two

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As I mentioned yesterday, I am spending time this week attacking GDP as the ultimate benchmark for measuring the strength of the economy. Yesterday, in Part One of the series , I noted that GDP includes government spending even though government spending does not necessarily benefit consumers. Today, I want to address another problem with GDP: it overemphasizes consumer spending to the detriment of capital investment . I am going to give you the same video I showed you yesterday, featuring Austrian economist Jeff Herbener, interviewed by Tom Woods. If you are short on time, skip to 4:55, where Prof. Herbener notes that GDP indicates only the value of the final goods and services produced. GDP is generally defined as the market value of the final products of an economy, including goods and services. But GDP does not measure all economic production. There is an entire production process that goes into the production of any good, whether it be a consumer good or a capital good. This does not get included in the calculation. For example, when a car is sold, the price of the car is included in GDP. Economists do not include, for example, the cost of the steps in the production process that provide the building blocks for the car — such as the mining of iron ore, the production of steel, or the machinery and computer modeling that serve to transform that steel into the skeleton of an automobile. The reason is that the final price of the car is thought to represent the cost of all stages of production of the automobile, ideally together with a profit for the company. If one counted the value of the production process and the cost of the car, it is said, that would represent “double counting” of the costs of the production process. That’s fine if your only goal is to learn the final value of the good. But leaving the production process out of the equation, and including only purchases of final goods and services, distorts the significance of the total . That’s because eliminating the work that goes into making the product gives an outsized significance to the act of purchasing that final product. As Professor Herbener has elsewhere explained : If all one is interested in determining the the dollar value of all that has been produced in the economy, then, counting the steel, and other parts of the car along with the car would be double counting. But the dollar value of what has been produced in an economy is, perhaps, the least interesting thing we could know about it. If we really want to understand an economy, we have to know how all the different resources people have get allocated into all the different production processes. The monetary value of all production tells us nothing about this. . . . . When we trace back the production of consumer goods to their sources, then, we see that the amount of demand entrepreneurs have for all the producer goods necessary to make some consumer good far outweigh the demand consumers have for it. In other words, the far greater portion of production in an economy is of producer goods , which is explained by entrepreneurial demands, which results in investment spending. Consumer demands and consumption spending are a far smaller portion of all demands and total spending and the production of consumer goods is a smaller portion of the production across the entire economy. By excluding the cost of production processes from GDP, economists overemphasize the importance of consumer spending. Based on measures of GDP, we are told that consumer spending is 70% of the economy, and that investment is only 15% or even as little as 10%. But that is radically wrong . That may be true when it comes to the value of the final goods. But those goods did not come out of nowhere. They had to be produced. Tom Woods recently interviewed an economist named Tim Delmastro who successfully lobbied the government to provide a number called “gross output.” This number measures spending at all stages of production — a concept central to Austrian economics. As Delmastro notes in the interview, the GDP number consists of consumer spending (70%) and government spending (20%) with business investment coming up as a distant third. This misleads people into thinking that increasing consumer spending is the most important thing to do in the economy. But when you measure “gross output” and get a more accurate picture of the economy, you learn that consumer spending is only about 30 to 40% of the economy, while business investment is actually over 50% of the economy . (The “gross output” number is actually quite poor under Obama, by the way. Shockingly.) At 8:21 in the video below, Woods makes the killer point that drives this point home: we are always told we need more consumer spending. If we followed that advice and took it to its logical conclusion, everyone who receives money for a good or service should just go spend it on consumption. As Woods says: But meanwhile, people are told, or are under the impression, that what we need is more consumer spending. Spend spend spend spend. But if we followed that advice . . . to a “T,” and everybody, as soon as he got money, just spent it on another consumer good . . . let’s say you buy ten gallons of milk from me, and I take that money and I buy a shirt, and the shirt guy buys a hat, and the hat guy buys a gallon of gas . . . then no wages get paid [and] all the production structure we just described grinds to a complete halt. But that would be Nirvana, because you have all the consumption you want! Woo-hoo! Tomorrow, in part three of the series, we identify the basic problem with GDP. Namely: it does not measure what we should be most interested in when we study economics: how to allocate scarce resources. See you then. P.S. Once again: if you choose to sign up for Woods’s “Liberty Classroom” to learn more about concepts like this, please do so though this link . Do yourself a favor and at least check out Woods’s free samples to see what you think.

See more here:
Consumer Spending Is Not the Most Important Part of the Economy — Why Paul Krugman’s Love of GDP Is Wrong, Part Two

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Everyone Is A Winner!

On May 28, 2014, in Barack Obama, by J3p69z5j

[guest post by Dana] It’s come to this : A government agency, believing employee ratings are too discriminatory, has opted to eliminate the process altogether. As a result of the decision, the Consumer Financial Protection Bureau (CFPB) will award all employees a gold star – regardless of their performance reviews. The CFPB, which oversees transactions in the financial sector for the federal government, decided to no longer conduct employee reviews because there were just too many apparent “significant disparities” between the races, ages, and locations of its employees. According to American Banker, this new policy is set to cost over $5 million dollars, as it will now pay employees as if they received the highest evaluation score. The previous system ranked staff on their performance from a scale ranging from one to five, with five being the best score a CFPB staffer could receive after a review of their work on the job. One wonders about the timing of such a decision involving such a costly change in procedure. This development comes right before the agency is scheduled for a Wednesday hearing to investigate allegations that it practiced retaliatory actions towards certain employees. News reports have circulated that the alleged “discriminations” were race-based and that the CFPB implemented their new policies to alleviate that problem. Apparently, the belief is that only racism can explain any disparities in employee evaluations. It should be noted that CFPB Director Richard Cordray justified the change in procedure, saying there were broad-based disparities in the way performance ratings were assigned. “These differences indicate a systemic disadvantage to various categories of employees that persisted across divisions, offices, and other employee characteristics.” –Dana

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Everyone Is A Winner!

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