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Stimulus Funds Used to Inebriate Mice

House Democrat Whip James Clyburn of South Carolina stated, “We’re not going to save our way out of this recession.” In fact, he believes we haven’t spent enough yet.  In fact, Clyburn told reporters, “We’ve got to spend our way out of this recession.”

With soaring deficits and unemployment at 10 percent, one would think the federal government would be careful with how it spends taxpayers’ money.  The examples of wasteful spending continue to flood the press along with evidence of phony job creation numbers.

One would think that it would be bad enough that the government is spending money like drunken sailors.  But now we find out they are spending stimulus money to make drunken mice!

That’s right!  Your tax dollars are going to serve up alcohol to mice in the name of stimulating the economy.  This is one of the stimulus projects being conducted by researchers at Florida Atlantic University.

Ah!  There is nothing like paying college students to see if mice become disoriented with alcohol.

But wait, it gets worse.

We have yet another example of how the Obama Administration continues to publicize inflated phony figures on the number of jobs created with the stimulus money.

This project claimed to create 0.92 of a job with the $8,408 dollars it received. 

You do the math. 

They hired 2 students to work for 11 weeks on this study over the summer.  That would make for a total of 22 weeks of work.  If they actually created 0.92 jobs with that money, you would have to assume they are paying less than $4.40 per hour (less than minimum wage) and that the university uses none of the funds for overhead or materials (which never happens).

Is this really stimulating the economy?

Is this project so worthwhile that its costs should be borne by taxpayers of future generations?

Obama Must Stop Killing Jobs

If President Obama were seriously interested in saving jobs in this fragile economy, he should quit whining that his huge majority in both houses of Congress won’t pass his bills.  Instead, he should focus in on friends that he appointed to high positions in his administration who continue to push regulations that kill jobs and strangle our economy.

The Obama Administration began killing jobs the first day it took office when the EPA changed course to restrict coal mining activities in West Virginia. 

These regulations are costing thousands of jobs in a state where unemployment is over 9 percent.  It raises the cost of coal mining also, so everyone pays more for energy.

Next, President Obama told Congress to pass a jobs-destroying cap-and-trade energy bill.  The House passed that bill, but the Senate thought it did not make much sense to kill more jobs in a recession and has stalled efforts to pass it.

Undeterred in his agenda to kill more jobs with extremist environmental legislation, Obama directed his EPA Administrator, Lisa Jackson, to push forward with a bureaucratic effort to declare carbon dioxide to be a pollutant.  To accomplish this, Obama appointees attempted to bury studies and reports questioning the use of unreviewed studies using poor data to support their findings that carbon dioxide is a pollutant.

In President Obama’s State of the Union speech on January 27, 2010, he said, “Let’s try common sense.” 

However, no matter how much you try to explain to them that carbon dioxide is not a pollutant, Obama and his extremist appointees continue to plow ahead with their effort to destroy jobs.

The Heritage Foundation points out,

With Congress unable to pass cap-and-trade legislation as easily as some Members hoped, the Environmental Protection Agency (EPA) is moving forward with its own set of global warming regulations. The EPA’s endangerment finding, which took effect January 14, gives the EPA authority under section 202(a) of the Clean Air Act (CAA) to regulate greenhouse gases (GHGs).

The EPA’s attempt to regulate carbon dioxide (CO2), in addition to being the most expensive and expansive environmental regulation in history, would bypass the legislative process completely.

But this same mentality is not limited to the EPA. 

On the very same day that Obama asks Washington and the nation to “try common sense,” his political appointees at the Securities and Exchange Commission (SEC) voted to require businesses to include new reports with their quarterly filings on the impact their business has on global warming.

This does nothing to create productive jobs and instead will increase compliance costs on businesses that are trying to be productive in this unforgiving economy. 

While President Obama may think creating more work for armies of regulatory lawyers is the path to full employment, their work usually ends in costly litigation that prevents working people from having constructive jobs in our economy.

$2.5 Million Super Bowl Ad Makes No Census

My perennially underperforming team, the Philadelphia Eagles, got knocked out of the playoffs so like millions of other Americans, I will be watching the Super Bowl for the ads.

Even though there is controversy swirling around the airing of  Pro-Life and gay dating website ads, the biggest controversy is that the United States Census Bureau will be using $2.5 million of taxpayer money to advertise during the Super Bowl.  According to the Washington Post:

The Census Bureau unveiled a $133 million advertising campaign Thursday that urges people to mail back the questionnaires that will be sent out in mid-March. The ads, in 28 languages, aim to save taxpayers’ money by reducing the need for temporary workers to survey people who don’t return their forms.

Some ads will be featured on high-viewership television shows such as the Golden Globe Awards on Sunday and the Super Bowl in early February.

This is the same agency that has had other problems.  According to Time magazine:

Use of the word Negro to describe a black person has largely fallen out of polite conversation — except on the U.S. Census questionnaire. There, under “What is this person’s race?” is an option that reads, “Black, African Am., or Negro.” That has raised the ire of certain black activists and politicians as the Census Bureau gears up to mail out its once-a-decade questionnaires. The controversy has been cast by many as an instance of a tone-deaf agency not keeping up with the times.
Taxpayers are exhausted from the lack of common sense shown by politicians and bureaucrats.  This $2.5 million ad by the Census Bureau will surely make people laugh, and now cry

 

 

Obama’s Proposed Spending and Savings: Not So Even Steven

President Obama’s January 27th State of the Union Address raised more questions than answers. While the national debt continues to soar past $12.3 trillion and the unemployment rate hangs at 10 percent, Americans long to hear the President offer some commonsense solutions. Instead, the President stubbornly clings to his stagnant tax-borrow-and-spend policies.

The below list, courtesy of the Senate Republican Policy Committee, shows some of the spending measures signed and policies supported by the President in the last year:

Now let’s compare those hefty price tags to some of the less-than-generous savings offered by the Obama administration:

  • Ten year savings from proposed spending freeze – $250 billion
  • Ten year savings from proposed terminations and reductions – $240 billion
  • Ten year savings from proposed Medicare cuts in Senate-passed health care bill – $500 billion
  • Savings from last year’s effort at finding efficiencies in the Federal government – $100 million

Obama’s spending measures outweigh his savings proposals by just a few billion.  Chump change?  I don’t think so.  If President Obama was determined to achieve real savings he would go line-by-line through the federal budget and start making some serious cuts. 

Mr. President, in case you’re stumped, Citizens Against Government Waste has done your homework for you.  Check out our 2010 Prime Cuts report, released on January 27, which has 763 recommendations that would save $350 billion in the first year and $2.2 trillion over the next five years.  It’s time to chuck your meager scalpel and pick up a hatchet.

Pentagon Begins the Fight Anew

According to a January 29, 2010 article in the Boston Globe, the fight over the alternate engine is about to start all over again.  According to the Globe:

The Pentagon’s budget request for fiscal year 2011, due out Monday, will try yet again to eliminate the alternate engine for the F-35 Joint Strike Fighter, the costly effort repeatedly funded at the insistence of Bay State lawmakers looking out for jobs at General Electric’s Lynn plant.

This news comes only weeks after Congress was successful in anonymously adding $465,000,000 to the F136 alternate engine program in the Fiscal Year 2010 Department of Defense Appropriations Act.

As you can see in the preceding quote, the paper does not pull punches as to who it blames for the alternate engine funds.  The Globe also names names:

In December, Democratic Sen. John Kerry and Rep. John Tierney, a Democrat of Salem, lauded the reversal as safeguarding as many as 1,000 jobs at GE’s plant, which is helping to design the engine to compete with the primary one built by Connecticut-based Pratt & Whitney.

According to a November 10, 2009 Reuters article, deliveries of the F136 alternate engine will be delayed by one year.  Built by General Electric and Rolls-Royce, the alternate engine program has had two major setbacks in as many months.  In October, F136 testing was halted when a nut came loose, damaging turbine blades in the engine.  The project, which has received $771.8 million in earmarks since 2004,  is expensive, unnecessary, and only survives because of pork-barrel politics.

Citizens Against Government Waste (CAGW) made the case against the alternate engine in an issue brief released in September.  In addition, for the past several months, CAGW has been raising awareness of the inherent waste of the program through a national advertising campaign that began on July 16, as well as communications to its members and supporters.

Happy Data Privacy Day!

That’s right, January 28 is Data Privacy Day.  According to Data Privacy 2010:

Data Privacy Day is an annual international celebration to raise awareness and generate discussion about information privacy.  In 2009, both the U.S. Senate and House of Representatives recognized January 28th as National Data Privacy Day.

Over the past few years, privacy professionals, corporations, government officials and representatives, academics, and students in the United States, Canada, and 27 European countries have participated in a wide variety of privacy-focused events and educational initiatives in honor of Data Privacy Day.  They have conducted discussions, examined materials and explored technologies in an effort to bring information privacy into our daily thoughts, conversations and actions.

While this may not be one of the more recognizable holidays in 2010, it’s importance is growing every year considering the massive amounts of information that is being shared online, including, but not limited to, social networking sites such as Facebook.

We are entering an era where your “online reputation” is becoming more and more important.  And, according to a report commissioned by Microsoft,

Of U.S. recruiters and HR professionals surveyed, 70% say they have rejected candidates based on information they found online.  Though not as frequently, respondents from the U.K. and Germany report the same trend. 

The biggest problem, according to the report’s findings, is that while many people do manage their online reputation:

…there are a significant percentage of respondents (between 30% and 35% depending on nationality) who don’t feel their online reputation affects their personal or professional life.  Consequently, they are not taking steps to mange their reputations.

This could be a huge problem.  And, if the companies running these sites don’t take steps to educate people and protect people’s privacy and reputation that could open the door for government regulation. 

While the government should always have the right of enforcement, the less government intrusion the better.  Then, there is the question of the security and use of information stored by the government.

So many questions, so little time.  So, in the meantime, sit back, go post a Status Update on Facebook and enjoy Data Privacy Day 2010.  Just remember, somebody that you don’t know may be reading your posts or looking at your pictures.

SOTU – The Good, the Bad, and the Very Expensive

CAGW President Tom Schatz’s Statement About President Obama’s first State of the Union Address:

The cash register started ringing up the trillions as soon as President Obama walked down the aisle.  He had to do something to overcome 10 percent employment and a combined $1.7 trillion deficit for fiscal years 2009 and 2010, and based on his agenda for the past year, it was going to be costly.  

The applause could not hide the frosty relations between Congress and the White House or the people and the President.  After lauding the American spirit and calling for a government that matches the people’s decency and strength, he launched into a discussion of the economy. 

He presented a disjointed plan.  First, after saving the banks, he wants to tax them.  Second, after not raising income taxes, he wants to increase them on those making more than $250,000.  Third, he claimed 2 million jobs were saved through the stimulus bill, which he touted as a success, but didn’t talk about how much it cost to create each job.  Fourth, he called for small business tax credits and the elimination of capital gains plus passage of a new jobs bill at a cost of $80 billion, an amount he never mentioned. 

The President talked about a ‘deficit of trust’ in Washington and that the acrimony on both sides had to be overcome so progress could be made.  While he called out both parties, he did not assess any blame to his own leadership, or lack thereof, on any issues.  

Of course, the ugly showed up, as he blamed the prior administration of George Bush for most of the budget shortfall.  At the same time President Obama called for taking action to reduce the deficit and debt, he continued to push for healthcare, cap-and-trade, and other very expensive programs.  Even ideas that might have been good – a spending freeze and earmark reform – fell far short of being effective.  Cutting $15 billion from a freeze in the face of the other very expensive programs he proposed is worth supporting, but will have little impact on the deficit and debt.  Rather than calling for an end to earmarks, he suggested publishing all earmarks on the Internet in a searchable manner before each vote.

The President touted another very expensive idea – high speed rail, an $8 billion boondoggle that will never work without additional massive subsidies.  There was a quick discussion of something good in regard to energy – nuclear power and offshore drilling.  But the bad followed without hesitation – climate change and a lot of subsidies for research on solar and other alternative energy sources.

 The National Export Initiative sounded a lot like existing programs such as the Market Access Program, which subsidies profitable companies for their efforts to sell goods overseas.  Then something good – support for free trade agreements; the first time Republicans stood up and Democrats stayed put.

 The national competition to improve schools implied that the Department of Education had not been doing its job.  He also suggested a takeover of student loans and forgiveness of certain loans if students entered public service, which will be the beginning of many other professions seeking such an exemption.  This may lead to the government just writing a check for everyone’s college education.

 While it was not first on the list, the extremely expensive healthcare bill came up about 30 minutes into the speech.  The President made the preposterous claim that it would save $1 trillion, a figure that no one has ever seen, which will add to the distrust of the proposal rather than increase its popularity.  His remarks showed a complete dismissal of the Massachusetts election last Tuesday.

 Finally Americans saw the absurd – House Speaker Nancy Pelosi’s reaction to the President’s pledge to support the rights of Afghans, men and women alike.  She gave a little fist pump of excitement about those women’s rights, which is about all Americans need to know about the person that is third in line for the presidency.

Obama to Claim the Dog Ate His Homework

President Obama repeatedly said both as a candidate and after inauguration that he would root out wasteful spending in the budget.  One year after taking full control of the reins of government he is preparing his first State Of The Union speech in which he plans to tell America that the dog ate his homework.

Spending and deficits have soared to historic levels in his first year.  The economy still shows little sign of life despite Obama’s claim in July that the recession was over.  And he continues to develop and propose new spending programs without finding anything to cut.

Now, rather than do his job and make the cuts he promised, or even propose them, he wants to put off his responsibility on an appointed commission to further study the issue of waste and report back sometime after the congressional elections in November.

If he were in school, this is not just telling the teacher that the dog ate his homework.  It is more like telling the teacher that the dog ate his homework and he had his uncle do the work instead and turn it in after grades were due for the year. . .but it’ll be OK, his uncle will do good work.

President Obama needs to step away from the teleprompter, stop giving empty speeches of promises of doing his job in the future and do the job he was elected and said he would do.

There is no need for any more commissions.  The government overflows with waste. The country watched as a lot of time was spent on a proposed government takeover of healthcare that included huge tax increases and cuts in benefits without a single provision addressing the waste and fraud in existing federal healthcare entitlements.

CAGW has pointed out billions of dollars of wasteful spending in the federal government.  President Obama is in charge of the Executive Branch of government and his party controls overwhelming majorities in both houses of Congress. 

It is time to quit dithering and blaming others for not doing your job.  There is no need for another commission. 

Just do it.

2010 Prime Cuts Released

What is Prime Cuts you ask?  It is the document that can help Congress, the President, and the nation move in the right direction to reduce the deficit.  Prime Cuts is a list of 763 spending cut recommendations that could save taxpayers $350 billion in one year and $2.2 trillion over five years.  Yes, we are talking real money.

From the Grace Commission to Reps. John Boehner (R-Ohio) and Eric Cantor (R-Va.) and even President Obama, Prime Cuts uses a number of different sources to suggest spending cuts.

What is in Prime Cuts.? Here is a sampling:

  • Eliminate pork-barrel spending:  Savings 0f $19.6 Billion
  • Cut funding for the C-17:  Savings of $4 billion
  • Eliminate funding for the DOE’s Nuclear Power 2010 Program:  Savings of $600 million
  • Eliminate the Market Access Program:  Savings of $231 million

The list goes on, and on and on and…..

With President Obama expected to talk about a partial spending freeze and fiscal responsibility in his State of the Union and the Congressional Budget Office releasing its new deficit number for 2010 at $1.3 trillion, Prime Cuts is needed now more than ever before.

Chill Out, This “Freeze” Isn’t The Real Deal

Now that President Obama has pushed through major spending bills including the TARP and “stimulus” packages (and let’s not forget the pricey healthcare and cap-and-trade proposals that hang in the balance), he believes it’s time to scale back the spending.

Don’t we all feel like dieting after stuffing our faces in a feeding frenzy?

In an effort to address concerns over the ballooning $12.3 trillion national debt, President Obama will propose a three-year spending freeze.

According to a January 26 Wall Street Journal article:

The administration officials said the cap won’t be imposed across the board. Some areas would see cuts while others, including education and investments related to job creation, would realize increases.

Among the areas that may be potentially subject to cuts: the departments of Housing and Urban Development, Justice, Energy, Transportation, Agriculture, and Health and Human Services.

Though this freeze has been touted as a well-intentioned step in the right direction, it would (at best) save $250 billion over the next ten years, small change compared to the hundreds of billions of bailout dollars spent in the blink of an eye this year.

The freeze would only affect 17 percent of the total federal budget and would not affect spending on defense, homeland security, veterans affairs, or international affairs…or entitlements…or mandatory programs…or “emergency” spending like a possible $80 billion “jobs” bill.  Hmmmm.

Overall, the proposal to limit discretionary spending will not have much impact as funding levels will be preserved at their already grossly-inflated 2010 levels.  It’s too little, too late.

Deficit to Hit $1.3 Trillion

According to the Congressional Budget Office (CBO):

CBO projects, that if current laws and policies remained unchanged, the federal budget would show a deficit of $1.3 trillion for fiscal year 2010. At 9.2 percent of gross domestic product (GDP), that deficit would be slightly smaller than the shortfall of 9.9 percent of GDP ($1.4 trillion) posted in 2009. Last year’s deficit was the largest as a share of GDP since the end of World War II, and the deficit expected for 2010 would be the second largest. Moreover, if legislation is enacted in the next several months that either boosts spending or reduces revenues, the 2010 deficit could equal or exceed last year’s shortfall.

Let the handwringing begin.

Oh, the Places You’ll Go! (If You’re a Member of Congress)

Although it is hardly a new phenomenon, members of Congress have recently come under intense scrutiny regarding taxpayer-funded trips (a cynical mind might even label them vacations).  The latest example is the recent Copenhagen Climate Summit.  The trip involved 22 members of Congress, 15 Democrats and seven Republicans.  The most notable attendees were Speaker Nancy Pelosi (D-Calif.) and Majority Leader Steny Hoyer (D-Md.).

Of course, when members travel, they do so well prepared:  on January 11, 2010 CBSNews.com reported that 101 Congressional staffers made the trip, as well as many of their spouses.  Comfort is also a necessity.  According to the CBSNews.com article, the group booked 321 nights in hotels, mostly at the five-star Marriott.  Three military jets were charted for the trip, costing taxpayers $168,000.  The full price, including the cost of the hotel rooms and food has not been disclosed.

Sen. James Inhofe (R-Okla.), a noted climate change critic, traveled to the summit to present an opposing viewpoint.  In the CBSNews.com article, Sen. Inhofe criticized his colleagues, saying they were “…going because it’s the biggest party of the year,” and that “The worst thing that happened there is they ran out of caviar.”

The Copenhagen trip is just one example of recent congressional travel that has created a stir.  In November 2009 12 representatives and several of their spouses and legislative aids attended the NATO Parliamentary Assembly, staying in a $300-per night hotel overlooking the Edinburgh Castle.  In addition to the rooms required to lodge participants, the group rented three additional rooms, which were stocked with “…liquor, Coors beer, chips and salsa, sandwiches, Mrs. Fields cookies and York Peppermint Patties…,” according to a December 17, 2009 article in The Wall Street Journal.

In addition, according to a December 16, 2009 article on CBSNews.com, in August 2009 Sens. Richard Shelby (R-Ala.) and John Cornyn (R-Texas) traveled to Europe to visit with banking regulators and industry executives, costing taxpayers $70,000.  Readers will be happy to learn that the senators, their wives, and aides were able to find time during the trip to tour the Rhine River, and also attend a heavy-metal music festival.

After constraints on privately-funded travel were instituted in 2005, members of Congress have increasingly turned to taxpayers to foot the bill for extensive and extravagant trips.  A Wall Street Journal analysis of travel records found that the reported costs of foreign travel in 2008 was $13 million – a 70 percent jump from 2005.

There is not an urgent legislative need for members to be traveling abroad so frequently.  Apparently considered just another perk of the job, taxpayer-funded travel needs to be re-evaluated by lawmakers, or the only trip they will be taking after the next election will be within their state or district, looking for a new job.

A Pivot or First Step in a Downward Spiral?

Washington Post Columnist Steve Pearlstein’s column today advises the Obama administration to stay calm in the face of Scott Brown’s election and the obvious disarray and panic among Democrats.  While we don’t agree on every segment of his column, he makes some interesting points about Obama’s unexpected pivot yesterday to change the subject and go after the banks:

One of my favorite bits of Monday morning quarterbacking is that President Obama should have put health care and Afghanistan and climate change and everything else on the back burner for the past year and insisted that he and everyone else focus exclusively on jobs, jobs, jobs.  What do you call a $787 billion stimulus package of tax cuts and increased spending, a $50 billion auto industry bailout, a $1 trillion prop to the housing sector and nearly another $1 trillion in old-fashioned monetary stimulus — chopped liver?  And how exactly do you square the idea that the president and Congress should be working 24-7 to “create” jobs with that other nugget of conventional wisdom, that Americans are demanding smaller government, less spending and lower budget deficits?

The answer is… you can’t!  The $787 billion stimulus package was a failure and any assertion to the contrary is pure, delusional spin!  The administration appears to be lousy with two kinds of people:  partisan idealogues and/or economic illiterates, PhDs notwithstanding.

Pearlstein then addresses the President’s anti-bank pivot yesterday:

Instead of moving to take back the health-care issue, however, President Obama on Thursday seemed more interested in changing the subject, launching another broadside against the big Wall Street banks.

In the populist imagination, the root of the recent financial crisis was the decision in the 1990s to allow commercial banks, which take deposits and make loans, to get into the riskier but more lucrative investment banking business, where firms underwrite and trade securities on behalf of their customers and themselves.  For months, liberals have been pushing to reinstate the old rules to separate the two activities.  And for months, Treasury Secretary Tim Geithner has pushed back, arguing that many of the banks that got in trouble did so the old-fashioned way, by making stupid loans, while many of the institutions that contributed most to the crisis — Bear Stearns, Lehman Brothers and AIG — weren’t in commercial banking at all.

However, Obama suddenly reversed course and embraced the populist critique, demanding that commercial banks give up their risky investment activities.  In truth, the new rules probably would not do much to reduce the chance of another crisis, or another bailout.  The president’s motives seemed less substantive than they were political, allowing him to shift from defense to offense and put Republicans in the uncomfortable position of having to defend the Wall Street status quo.

Consider that the federal government now owns the two biggest culprits in the economic meltdown and is still protecting them and propping them up to the tune of potentially trillions:  Fannie Mae and Freddie Mac.  Yet, like Voldemort, their names are never mentioned and were conspicuously absent from yesterday’s announcement.

Even Treasury Secretary Geithner and his National Economic Council Director Lawrence Summers have grave misgivings about this strategy…but this administration has always been completely schizophrenic when it comes to the banks and the financial services industry.  They attack them, then they cajole, then they beg them to do more, now they are going to muscle them with new regulations which have nothing to do with what caused the meltdown in the first place;  congressional meddling and government-created incentives to make lots of bad loans!

Wouldn’t it have made sense now, after the Brown victory, to go back and address the real reasons for his victory?  The mindless wasteful spending, the gigantic deficits and debts, the imperiousness of Congress, the knee-jerk secrecy and arrogance?  And, if they want to address healthcare reforms that could be enacted with bipartisan support, they could begin by exploring incremental, pro-free market, patient-centered steps that a vast plurality of Americans have said they favor.

Instead, President Obama chooses to demagogue an issue his pollsters and the ideologues in his Cabinet apparently perceive as a populist winner:  the public’s disgust with the banks.



Bump in Jobless Claims

There was a surge in first-time unemployment claims in December, according to today’s Associated Press:

A Labor Department analyst said much of the increase was due to holiday-season-related administrative backlogs at the state agencies that process the claims.  Still, economists noted that that would mean claims in previous weeks had been artificially low.  Those earlier declines had sparked optimism that layoffs were tapering and that employers would add a modest number of jobs in January.

The January employment report will be issued Feb. 5.  But the surveys used to compile that report were done last week, so economists are paying close attention to the jobless claims figures from that week.

“The trend in the data is still discouraging,” Diane Swonk, chief economist for Mesirow Financial, wrote in a note to clients.  “Hopes for a positive employment number in January … are rapidly dimming.”

The disappointing jobless claims report contributed to a gloom on Wall Street.  The Dow Jones industrial average dropped 182 points by late morning, or 1.7 percent, and broader indexes also fell.

A separate report Thursday that seeks to forecast future economic activity offered a more positive outlook.  The Conference Board’s index of leading economic indicators jumped 1.1 percent in December, suggesting that economic growth could pick up this spring.

The Labor Department report said the number of people continuing to claim regular benefits dropped slightly to just under 4.6 million. The continuing claims data lags behind initial claims by a week.

But the so-called continuing claims do not include millions of people who have used up the regular 26 weeks of benefits customarily provided by states and are now receiving extended benefits for up to 73 additional weeks, paid for by the federal government.

More than 5.9 million people received extended benefits in the week that ended Jan. 2, the latest period for which data are available.   That’s an increase of more than 600,000 from the previous week. The data for emergency benefits lags behind initial claims by two weeks.

The rising number of people claiming extended unemployment insurance indicates that even as layoffs are declining, hiring hasn’t picked up.  That leaves people out of work for longer periods .

So, what happened to the stimulus funds?  Where are the hundreds of thousands of jobs that were supposed to have been created or saved after the passage of the $787 billion pork package in February of 2009?  

Officials of the Obama administration have made outlandish statements on stimulus job creation.  In October, 2009, the administration patted itself on the back for having created 640,329 jobs.   In December, 2009, the reliably understated VP Joe Biden claimed that the stim spending salvaged between 600,000 and 1.6 million. 

Ed DeSeve, senior adviser to the president for the stimulus plan, also said in a letter that there was “nothing mysterious, ephemeral, or uncertain” about the role the recovery package has played in saving the jobs of teachers, firefighters, police officers, and others who would have been laid off by cash-strapped state and local governments.” 

What kind of nonsense is that?  Mr. DeSeve, whom CAGW named November 2009 Porker of the Month, has apparently conveniently forgotten that President Obama explicitly stated that 90 percent of the stimulus jobs would be created in the private sector.  

Not to be outdone, the President’s chief economist, Christina Romer upped the ante (and upping the rhetorical ante on logorrhea-prone Biden is quite a feat), stating on January 12, 2010 that the number is closer to 2 million jobs!  And her report claimed that the stimulus package added two percentage points to the GDP in the fourth quarter. 

Using their fuzzy math, that would mean that we would have a whopping 1.8 million new jobs in the private sector. 

Does not add upPeriod

In a related development, however, the OMB did release a memo on December 18, 2009 in which the jargon employed by the White House to describe stimulus-created jobs has been, shall we say, tweaked!:

Peter Orzsag, director of the Office of Management and Budget, has made a big change in the way the Obama administration keeps track of jobs created by the stimulus bill.

Instead of trying to count all the jobs “created or saved” by the $787 billion legislation, the White House will now count all jobs funded by the bill, according to a Dec. 18 memo written by the OMB chief.

OMB says doing this will help improve data quality and improve the public’s understanding of the numbers, but some Republican critics view it as a calculated move towards boosting the overall jobs created by the bill.

“Instead of trying to define jobs created or saved this will look at jobs funded by the Recovery Act,” OMB spokesman Tom Gavin told The Washington Times.

“No one understood what created or saved meant,” he added. “So we are using a more easy to understand definition.” He also noted that the Government Accountability Office recommended these changes in a report issued last fall.

In a January 12, 2010 letter to Earl Devaney, Chairman of the Recovery Accountability and Transparency Board, California Rep. Darrell Issa (R), Ranking Member on the House Oversight and Government Reform Committee complained about the change, saying:

A library that begins paying two pre-existing full-time librarians with Recovery Act funds must count two additional full-time equivalents toward the overall job totals, even though the two workers were not hired as a result of the Recovery Act, and regardless of whether their jobs were ever in danger.

We are just weeks away from receiving the next installment of data from Recovery.gov, for what it is worth (which is not much)….and we are weeks away from a congressional vote on raising the national debt ceiling by another $2 trillion.

Oh yeah….everything is coming up roses.

Transportation Authorization Finally Moving?

Congress and the President were supposed to pass and sign a new highway authorization bill last year.  This is the piece of legislation that authorizes the government to collect the gas tax to fund all sorts of highway and transportation  projects.  Through a series of stop gap measures transportation spending  has remained at the previous level. 

In 2005, CAGW blasted the $286.5 billion Transportation Equity Act — A Legacy for Users (TEA-LU):

The highway bill is a fiscal car wreck. The sweet smell of pork has blinded members of Congress to the waste and inefficiency of federal transportation policy.

Among the egregious examples of the more than 6,000 earmarks in the last bill were:

  • $14,000,000 to improve marine intermodal facilities in Ketchikan (AK)
  • $5,000,000 for the city of Robstown Trade Processing and Inland Center (TX)
  • $5,000,000 for road and transportation improvements near the Brooklyn Children’s Museum (Brooklyn, New York)
  • $5,000,000 for the University of Oklahoma, to conduct research on global tracking methods for intermodal containerized freight (Norman, Oklahoma)

 Now, it looks like Congress is ready to move forward with a new transportation bill but the President is not.  According to The Hill:

President Barack Obama has yet to back a $500 billion transportation bill that Democrats plan to move early this year.

During a closed-door session with the entire House Democratic Caucus, Rep. Jim Oberstar (D-Minn.), the chief sponsor of the transportation reauthorization measure, pressed Obama to back his bill funding road, rail and transit projects.

There is very little doubt as to whether or not there will be an agreement to craft a new long overdue transportation bill.  Unfortunately, the word “agreement” in Washington speak means pork.  Adding to taxapyers glum, the new transportation bill is expected to be $500 billion, almost double the price tag of the last bill.  That means potentially more earmarks.

Even though President Obama has shown skepticism about signing a new bill, the truth is that the White House is obsessed with infrastructure projects, and transportation projects tend to be the most popular, so the prospect of an earmark-free bill looks very slim.

As Massachusetts Goes…

…so goes the ongoing effort to fight government waste, higher taxes, and save the future for our children and grandchildren.

Let me first make clear that nothing written here is intended to influence the outcome of any election and that I am writing this blog post as president of the Council for Citizens Against Government Waste (CCAGW) in case anyone ever asks.

The closeness of the polls in the special election for Senate in Massachusetts reflects a national outpouring of outrage over the overreaching Congress and White House, and a lot of buyer’s remorse for the 2008 election.  Americans wanted change, but they did not want it to include massive new government regulations, a highly partisan Congress, backroom deals on major legislation, and a takeover of large parts of the economy (with more likely to come depending on the outcome of the vote tomorrow as well as in November).

Ironically, in the one area where CCAGW and many taxpayers would agree with President Obama – eliminating wasteful spending – the Washington Times reported on January 15 that $6.9 billion of the $11.3 billion, or 60 percent, of the cuts proposed by the President was agreed to by Congress.  Much of that was in defense rather than domestic programs.  Even within the defense budget itself, the President had victories in cutting spending for the F-22 and Future Combat Systems offset by $465 million in continued funding for the alternate engine for the Joint Strike Fighter and $2.5 billion for C-17s the Pentagon didn’t want.

But these achievements were unnoticed by the taxpayers, who remain overwhelmed by ongoing joblessness in the private sector while government employment has increased.  They are also angry at the impact on their children and grandchildren of the record deficit and debt, unimpressed by the expenditure of billions of dollars of stimulus money and the failure to provide evidence of success, and just puzzled by the obsession with passing healthcare reform in the face of much more important priorities.

In most cases where Americans feel something is going wrong, there is not an immediate outlet available to express their concerns.  While only Massachusetts residents can vote tomorrow, millions of Americans have voted with their dollars and their time by sending financial support and/or volunteering to help the Brown campaign.  To them, the healthcare bill is not the only target; it is the entire Obama/Reid/Pelosi big-government agenda.

It is likely that the “Cornhusker Kickback,” as many have called the deal to exempt the state of Nebraska from increased Medicaid costs in order to secure Sen. Ben Nelson’s (D-Neb.) vote, will be viewed as the “Bridge to Nowhere” of the healthcare debate and perhaps the beginning of the end of one-party control in the nation’s capital.  While that was not the only deal intended to buy votes, it crystallized h0w the Democrats are willing to do anything just to pass a bill, regardless of the consequences for the country, or for their party.

Governors from both sides of the aisle are certainly aware of the impact of the healthcare bills on their states, most of which are in dire financial straits, and have been vocal in their objections.  California Governor Arnold Schwarzenegger (R) sharply criticized the legislation passed by the House and Senate in his January 6 State of the State Address.  He said, “While I enthusiastically support health care reform, it is not reform to push more costs onto states that are already struggling while other states get sweetheart deals.  Health care reform, which started as noble and needed legislation, has become a trough of bribes, deals and loopholes. You’ve heard of the bridge to nowhere. This is health care to nowhere.”

According to an article in the December 22, 2009 New York Daily News, New York Governor David Patterson (D), New York City Mayor Michael Bloomberg (R), and other state officials said  “the Senate plan would force the city to close 100 health clinics; blow a $1 billion hole in the state’s budget; and threaten struggling hospitals, nursing homes and other facilities.”

A January 14 Heritage Foundation analysis found that the combined cost of increased spending and administration of expanded Medicaid coverage would be $32.6 billion from 2014 to 2019 under the Senate bill, and $60 billion from 2013 to 2019 under the House bill (the House bill expands coverage more than the Senate bill).  In California, those figures are $7 billion and $8.6 billion, respectively; in New York, the added expenses would be $2.6 billion and $3.2 billion (meaning New York officials underestimated the impact on their state).

In Massachusetts, those costs would be $202 million under the Senate bill and $615.5 million under the House bill, something that a state with a projected $3  billion budget deficit for fiscal year 2011 can ill afford.  The money for expanded coverage has to come from somewhere; if Congress decides that every state should get the same exemption as Nebraska, the $32 billion to $60 billion cost would be borne by all taxpayers.

There are also constitutional questions about the healthcare bill, particularly in regard to the individual mandate.   This was first noted by the Congressional Budget Office (CBO) during the debate over the Clinton healthcare plan (which didn’t even have such a mandate).   CBO said, “A mandate requiring all individuals to purchase health insurance would be an unprecedented form of federal action. The government has never required people to buy any good or service as a condition of lawful residence in the United States. An individual mandate would have two features that, in combination, would make it unique. First, it would impose a duty on individuals as members of society. Second, it would require people to purchase a specific service that would be heavily regulated by the federal government.”  The Heritage Foundation elaborated on this issue in a December 9 Legal Memorandum, noting that “An individual mandate to enter into a contract with or buy a particular product from a private party, with tax penalties to enforce it, is unprecedented– not just in scope but in kind–and unconstitutional as a matter of first principles and under any reasonable reading of judicial precedents.”

The authors noted that Congress could have enacted a general tax or provided a tax credit for individuals to purchase health insurance, but that would have required putting those costs into the federal budget in a normal manner.  If the individual mandate is found to be unconstitutional, the entire healthcare plan would collapse, since the fees and penalties are an essential part of the financing scheme.

Finally, no one really believes that the healthcare plans will save money.  The “savings” are based on “unrealistic” promises to cut Medicare spending, according a December 10 report by the chief actuary of the Centers for Medicare and Medicaid Services.  Former Minnesota Senator Rudy Boschwitz (R) and Representative Tim Penny (D) noted in a July 29, 2009 Investors Business Daily op-ed, “When Medicare was being considered in the mid-1960s, the government projected that the outlays for the program 25 years down the road would be $10 billion. Instead, in 1990, 25 years later, the outlays were $107 billion. Government estimates were off by a factor of more than 10! Medicaid, the other large medical program currently in effect, outdid Medicare. Medicaid outlays in 1968 were $1.8 billion. In 2007 they had risen to $190.6 billion, an increase in dollar terms of 105.9 times.”

Two days later, on July 31, the Republican staff of the Joint Economic Committee published a memorandum showing that healthcare costs are often “significantly understated.”  The memo covered programs from Great Britain’s National Health Service to Medicare and Medicaid to Massachusetts’ universal healthcare plan.  The latter may be a factor in the Senate race, since when it was passed in 2006, it was projected to cost $472 million in 2008, yet ended up costing the Bay State $628 million in that year.

The story of the Massachusetts election will also be about independent voters, who supported President Obama over Sen. John McCain in November 2008.  They were already trickling toward Republicans (or at least away from Democrats) as shown in the governors’ races in Virginia and New Jersey last November, and that is now turning into a flood that could wash out the filibuster-proof 60 vote majority in the Senate.

The White House, many Democrats, and the liberal media should be regretting the dismissal of the tea parties as not being relevant or important.  The remarks by Sen. Sheldon Whitehouse, the junior senator from neighboring Rhode Island, are likely reverberating in Massachusetts as well.  On December 20, during the debate over healthcare, he said that foes of healthcare and President Obama are “fanatics,” “birthers,” and “running around in right-wing militia and Aryan groups.” The problem for you and the President’s agenda, senator, is that these “fanatics” are ordinary, hard-working Americans, and they will be a significant factor in tomorrow’s election in Massachusetts.

Climbing Out of The TARP Pit

Congress’s TARP Overseer recently issued a report on whether and how the taxpayers will unwind the TARP program.  Read it all, but, like everything else that the politicians in Washington, D.C. touch lately, success is in the eye of the spinmeister:

The Panel is also concerned that, although Treasury has been consistent in articulating its
principles, the principles as announced are so broad that they provide Treasury with a means of justifying almost any decision.  This means that there is effectively no metric to determine whether Treasury’s actions met its stated goals.  Because any approach may alternatively be justified as maximizing profit, or maintaining the stability of significant institutions, or promoting systemic stability, almost any decision can be defended. Measuring Treasury’s success against these metrics is problematic.

In other words, it’ll be a success just like the Stimulus was a success.

Which Big Banks Are the Voldemorts of the Financial Crisis?

This week, the Financial Crisis Inquiry Commission (FCIC) launched it’s year-long probe on how we got into this unholy mess with two days of hearings, starting yesterday with the CEOs of the investment bankers, Jamie Dimon of JP Morgan Chase, Lloyd Blankfein of Goldman Sachs, John Mack of Morgan Stanley, Brian Moynihan of
Bank of America.  Will the hearings and the subsequent report be an authentic “teachable moment” or just another in a long line of show trials masquerading as serious congressional inquiries?  Yet to be determined. 

Knowing that the bankers would be in Washington, the Obama aministration timed its announcement of a big new tax on banks to coincide.  And Sunday’s appearance on ABC with George Stephanopoulos by White House Council of Economic Advisers Chair Christina Romer, in which she bashed the bank execs over their compensation and bonuses…again, was also no coincidence.   All part of the administration’s desire, no doubt, to lay all the blame for the economic meltdown at someone, anyone, else’s feet. 

 The bankers were on the luke-warm seat at the FCIC hearing on Wednesday and reaction to the new tax was among the first questions asked of JP Morgan Chase CEO Jamie Dimon by members of the media scrum after his testimony was concluded and before he could make for the door. 

The administration has made a habit of bludgeoning the investment bankers publicly, while on the other hand demanding that they do more to rescue the economy by loosening their credit requirements in order to make more loans (What?  The stimulus package isn’t working?!).  Which sounds eerily familiar.  Georgia Rep. Tom Price (R) put it perfectly: 

“It’s not every day the leader of the free world blames you for a problem and then tells you to do the exact same thing that caused the problem.”

According to CNBC’s Charles Gasparino, during a December, 2009 dressing-down session that Obama hosted, Dimon reportedly interrupted to explain to All The President’s Men that the reason that small businesses were hoarding cash and shying away from taking out new loans is because they are unsure of what the administration and Congress plan to do to them next…..new taxes, new healthcares mandates, new regulations, a plague of locusts, what?  Gasparino, writing in the NY Post, quoted someone familiar with what was said during the grilling, stated that Dimon told President Obama that:  

…many businesses simply don’t want to borrow to expand their operations and hire more workers.

“Jamie basically said the demand for loans is way down because businesses, particularly those that are making money and can qualify for loans, simply don’t want to borrow,” said one person with direct knowledge of the conversation.

And they’re not borrowing because they don’t know just how high their tax bills will be when the president gets done implementing all his “hope” and “change.”

House Financial Services Committee Chairman (frequent bloviator about executive compensation and purveyer of class warfare) Barney Frank (D-Mass.) quickly opined that Congress absolutely must levy such a tax because the banks continue to pay executive bonuses, etc.

Enough.  It is time to verbalize the name or names, in this case, that are never to spoken aloud, at least not by the Obama administration and the Democrats on the Hill – the Voldemort(s) of the financial crisis…Fannie Mae and Freddie Mac

It is no wonder that the Franks and Romers would rather engender bank hatred.  Protected and cossetted by Congress (Frank was sugar-daddy #1), Fannie and Freddie (sub)primed the mortgage market for years, until the market was as bloated and gaseous as the Heene family balloon, and just as much of a hoax.  

Then they went belly-up and left taxpayers to clean up the mess. 

Yet, so far, the FCIC has not listed any representatives from either company, current or past, on its witness list. 

On Christmas Eve, the Obama administration scurried to eliminate the $400 billion lending cap on the two bankrupt companies, which means that taxpayers are now on the hook, in perpetuity, for the trillions in liabilities on Fannie and Freddie’s balance sheets.  

New analysis reveals that the true value of the mortgages being bought by the two companies for many years, as they were permitted to amass trillions of dollars in mortgage-backed securities, were being systematically misrepresented as far back as the 1990s.    

The U.S. Treasury recently agreed to pay the executives of these failed behemoths, who are essentially government employees now, $42 million in executive compensation and bonuses. 

The CBO just released a report on the budgetary treament of Fannie and Freddie.  A couple of key graphs, but read it all: 

Despite having a unique legal status and a long history linking them to the federal government, Fannie Mae and Freddie Mac have been considered private firms owned by their shareholders.   However, with the entities facing substantial losses that threatened their solvency, the government took control of Fannie Mae and Freddie Mac through its authority under the Housing and Economic Recovery Act of 2008 (HERA).  The federal government now exercises an extraordinary degree of management and financial responsibility over them.  CBO believes—consistent with the principles outlined in the 1967 Report of the President’s Commission on Budget Concepts—that it is appropriate and useful to policymakers to account for and display the entities’ financial transactions alongside other federal activities.In the baseline budget projections it published in 2009, CBO accounted for the cost of the entities’ operations in the federal budget as if they were being conducted by a federal agency.  That is, CBO treated the mortgages owned or guaranteed by Fannie Mae and Freddie Mac as loans and loan guarantees of the federal government.  The operations of Fannie Mae and Freddie Mac added $291 billion to CBO’s August baseline estimate of federal outlays for fiscal year 2009 and $99 billion to the spending projected for the 2010–2019 period.

The estimated outlays for Fannie Mae and Freddie Mac represent the subsidy cost (in other words, the long-term cost to the federal government) of those entities transactions.  CBO estimated that cost by projecting the net cash flows associated with the two entities’ mortgage commitments and converting those estimates into present values using risk-adjusted discount rates.  (The discount rates reflect the expected rate of return that the government could earn on investments or securities of comparable risk.)  That procedure is conceptually equivalent to the methods that private companies use to compute the fair value of certain assets and liabilities under generally accepted accounting principles.

The Administration takes a different approach (I’ll bet they do):

The Administration has taken a different approach to recording the impact of Fannie Mae and Freddie Mac on the federal budget.  Following the enactment of HERA, the Treasury signed agreements with the two entities intended to ensure that they could continue to support the mortgage market.  In exchange for making direct cash infusions into the entities, the Treasury received shares of their preferred stock and warrants to purchase their common stock.  The Administration’s Office of Management and Budget (OMB) continues to treat Fannie Mae and Freddie Mac as outside the budget, and it records and projects outlays equal to the amount of those cash infusions. 

As a result, the Administration has not included in its budget figures subsidy costs that would be directly comparable to CBO’s $291 billion estimate of subsidy costs in 2009.  Instead, because the Treasury provided a total of $95.6 billion in cash outlays to the two entities in fiscal year 2009, the government’s final report of spend¬ing for 2009 included that amount, which is similar to CBO’s August 2009 estimate of cash infusions for that year ($112 billion). OMB has estimated that cash outlays from the Treasury to the two entities will total another $65 billion over the 2010–2019 period.

If we ever want to get to the bottom of the economic crisis, which is and was a mortgage crisis, and truly understand it, the role of the U.S. Congress’s housing policies and negligence vis-a-vis Fannie and Freddie must be fully explored and exposed.  Everything else, including stoking populist rage against the banks, is nothing more than a diversionary tactic.

Financial Crisis Commission: Teachable Moment or Political Blame Game?

CAGW today urged the Financial Crisis Inquiry Commission (FCIC), which held its first hearing today, to fully leverage its ample authority to get to the bottom of what provoked the country’s current fiscal crisis and to protect the Commission’s work from being hijacked or transformed into a political show trial.  The FCIC, a 10-member bi-partisan panel that was established in the Fraud Enforcement and Recovery Act of 2009, which was signed into law by President Obama on May 20, 2009, is charged with examining “the causes, domestic and global, of the current financial and economic crisis in the United States.”  In today’s opening statements, FCIC Chairman and Co-Chair Phil Angelides (D) and Bill Thomas (R) both stated that one of the key goals of the Commission will be to ask the questions that American taxpayers would ask if they could. 

The first question taxpayers would ask would be in regard to the role that Congress’s public policy decisions played in the failure of the financial services markets.  Since the current crisis enveloped the country, populist sentiment toward “big banks” and “Wall Street fat cats” has become increasingly negative.  If, in fact, there was excess, gamesmanship, unethical or illegal activity among banks, taxpayers have a right to know and appropriate regulatory and legal actions should be taken.  Taxpayers also have a right to fully comprehend the impact that Congress’s decisions on financial services issues, especially in regard to Fannie Mae and Freddie Mac, the two mortgage government-sponsored enterprises (GSEs) currently under government conservatorship, had on the subsequent meltdown.  Fannie Mae and Freddie Mac, which at one time owned or guaranteed more than half of the nation’s mortgages and reportedly misled ratings agencies about the quality of those assets, had an important role in the financial crisis, yet, so far, no one from either company is listed as a witness before the Commission. 

Congress and the current administration have been incoherent vis-à-vis the financial services industry,” said CAGW President Tom Schatz.  “On the one hand, the President and some members of Congress publicly excoriate bankers, laying much of the blame for the meltdown at their feet and stoking rage about their compensation.  Yet Congress has bailed out two of the biggest players in the mortgage market meltdown, Fannie Mae and Freddie Mac, after failing for many years to address the systemic risk posed by the two GSEs. 

On Christmas Eve, the Obama administration quietly lifted the $400 billion cap on taxpayer funds available to Fannie Mae and Freddie Mac, issuing the two bankrupt wards of the Treasury a blank check on taxpayer funds, while announcing no exit strategy to wind down these entities.  In addition, the U.S. Treasury is now paying the GSE executives, who are essentially government employees now, $42 million in executive compensation.  President Obama routinely attacks the banks, demanding that they step up their lending and do more to help rescue the economy, while simultaneously proposing a new set of taxes on consumer lending. 

The Congress itself is poised to pass a raft of sweeping financial services regulations, even before the Commission has begun its analytical work to determine how to mitigate future risk.  Congress’s public policy and regulatory decisions played an enormous role in the crisis and we urge the Commission to fully explore those actions as well.”

Murtha Earmark Scandal Update

I know.  The title is vague considering the massive amounts of earmarks that Rep. John Murtha (D-Penn.) has secured over the years (In 2009, he secured 51 earmarks worth $132 million).  Now, according to Roll Call:

A defense contractor accused of diverting money from an earmark provided by Rep. John Murtha (D-Pa.) has been scheduled for sentencing at the end of February, suggesting that his cooperation with federal agents investigating earmarks is coming to a close.

Rick Ianieri, former CEO of Coherent Systems International, pleaded guilty last summer to diverting $1.8 million from an $8.2 million earmark and distributing it to companies for items that were not part of the original project. His sentencing was originally scheduled for September, but as part of his plea, Ianieri agreed to cooperate with ongoing federal investigations.

It was nearly a year ago that ABC News reported that:

The FBI raided the offices of a defense lobbying firm with close ties to Democratic Rep. John Murtha (Penn.), sources tell ABC News.The FBI searched the Virginia headquarters of the PMA Group in November, according to the sources, who spoke on the condition of anonymity. PMA was founded by former congressional aide Paul Magliochetti and specializes in winning earmarked taxpayer funds for its clients.

PMA is the second company with close ties to Murtha to be raided by federal agents recently. In January, agents from the FBI, the IRS and the Defense Criminal Investigative Service searched the office of Kuchera Industries and Kuchera Defense Systems, as well as the homes of the firms’ founders. The companies reportedly have received over $100 million in earmarks, thanks to Murtha’s efforts.

Let’s hope these dominoes continue to fall with the last one being Rep. Murtha’s career as a United States Congressman.

Washington: Where the Sun Don’t Shine

Swineline readers may recall a January 5th blog post regarding C-SPAN’s push for a transparent healthcare negotiations process and a recent WasteWatcher article on the “read the bill” initiative and the five commonsense reforms pushed by House Republicans.  These proposals are part of a larger effort to shed light on the legislative process and make Congress more open and accountable to the American public.

Congress (sadly, but not surprisingly) hasn’t got the message, as backroom wheeling-and-dealing persists.  While major corporations and special interest groups are offered a seat at the table, the average citizen is rarely made privy to the details of a bill that, frankly, they end up paying for. 

Today, Rep. Vern Buchanan (R-Fla.) announced that he will file a discharge petition to force a House vote on H. Res. 847, the “Sunshine Resolution,” a proposal that would require public access to the healthcare bill negotiations.  Despite its merits, the resolution which currently has 151 bipartisan cosponsors has been blocked by Speaker Nancy Pelosi.

 “In Florida we have one of the strongest right-to-know laws aimed at ensuring that government leaders conduct the people’s business in public,” said Buchanan.  “No private meeting, no backroom deals, no secrecy. It’s time to shine some Florida Sunshine on the Halls of Congress.”

“Health care reform is one of the largest public policy reforms taken up by Congress in generations,” added Buchanan.  “If enacted, the final bill will impact the lives of all Americans.  With so much at stake, any conference committee or meetings held to determine the content of sweeping national health care legislation should be held in full public view, not behind closed doors.”

CAGW continues to pound the drum for fair, open, and transparent healthcare negotiations.  It’s time to draw back the curtain and offer hardworking, taxpaying Americans the opportunity to be part of the legislative process.

NOW They Decide to Delve Into the Details?

Today’s Washington Post has an illuminating piece about the complexities surrounding the Reid bill’s provisions to tax high-cost health insurance plans, the so-called “Cadillac Plan” tax.  

After reading it fully, you will wonder, as I did, where the mainstream media outlets have been all this time on covering all of these substance issues, and why they didn’t spend more time, before theses execrable bills got to the point-of-no-return phase, explaining the intricacies to consumers and taxpayers, educating them.  Better late then never, I suppose, but the Reid bill is so fraught with really bad ideas that there is very little time left for reporters who are so inclined to stop chasing the meaningless inside-baseball minutae and start exposing the salient facts about the bill itself.    

The pitfalls of this tax are becoming increasingly obvious:

The Senate bill would phase in the tax more slowly in some higher-cost states and exempt a few industries that tend to have expensive plans, such as mining. But opponents say it is impossible to find a workable way of targeting the tax so it would spare people whose plans are not particularly generous.

“It’s a very blunt instrument,” said former labor secretary Robert Reich. “It makes far more sense on policy and political grounds to tax the top 1 percent rather than sweep in so many people that are paying more for health care, not because they are getting more health care but because they’re older or working for small businesses.”

Rep. Joe Courtney (D-Conn.) notes that Obama pledged not to raise taxes on anyone earning under $250,000 and that he attacked Sen. John McCain (R-Ariz.) on the campaign trail in 2008 over his plan to do away with the tax-free treatment of employer-provided benefits. Pro-Republican groups are already turning the tables by running ads accusing Democrats of wanting to tax benefits.

“It’s a plan that has great political risk for the Democrats,” Courtney said.

And the article addresses the $900 billion question:

 Would it lower costs?

Separately, several health-care experts question whether shifting people into lower-cost plans is the best way to slow spending. It is possible, they concede, that the tax could move more employees into HMOs known for more efficient spending. But many markets lack such options.

It is more likely that employers would lower the cost of plans by increasing deductibles and co-pays, which skeptics say would not necessarily bring down health-care costs. Most costs are incurred by a minority of chronically ill patients. And health care is not like other markets, where consumers can make their own judgments based on quality and price; instead, patients make most major health-care decisions based on what their doctors tell them, skeptics point out.

A Rand study from the 1970s found that higher co-pays and deductibles led patients to limit medically necessary care as much as wasteful care, possibly leading to more costly health-care needs later.

“The consumer-directed-health-care crowd argues that with high cost-sharing, patients will do the only legitimate . . . cost-benefit calculus — but that surely is nonsense,” said Princeton economist Uwe Reinhardt. “None of these proponents has ever shown that patients are even capable of evaluating the clinical merits” of treatment options.

He is wrong.  One of the primary reasons that pateitns are “incapable” of evaluating the information is that cost and quality information on treatments, medicines, and health outcomes in general is NOT READILY AVAILABLE to the health consumers. 

If there was a competitive healthcare market operating out there, patients (who should be in control of their own healthcazre dollars) would have demanded all of that information long ago and we would have developed the kind of sophisticated medical infrastructure and electronic record-keeping that everyone believes we should have and which would empower pateints to make informed decisions about treatments, drugs, etc. 

That will evolve not via government fiat, but when consumers are in control of healthcare dollars and the insurance insurers and healthcare professional are forced to respond to their customers.  (Sidebar:  Think of the kinds of  high-wage, private sector, cutting-edge jobs that would spring out of a consumer healthcare revolution; rather than what we will be saddled with - a hugely expensive, wasteful, inefficient, top-down bureaucratic explosion where the only jobs that will be created are taxpayer-subsidized, statist jobs).   CAGW wrote about patient-driven healthcare years ago, and it has been addressed here and here, among many other places.  

Opponents of the tax say the case for it assumes that the country’s high health-care costs are the result of patients’ overuse of care. But, they note, the country’s usage of medical care is by many measures lower than in other developed countries; it is the price that is so much higher here.
“The biggest problem we have isn’t that we’re demanding so many services, but it’s that the type of services we’re providing are so expensive,” said Thomas Rice, a UCLA health-care expert.

Some economists also doubt that employers would shift savings from health care into wages, given how slack the labor market is likely to be for the foreseeable future.

Jonathan Gruber, an MIT economist and a leading proponent of the new tax, dismisses these concerns. Even if the tax hit some high-cost plans that are not particularly lavish, it would still goad employers generally to seek lower-cost plans, he contends. “The argument that because it won’t cause efficiency in every case, we should therefore not do it, is a dumb argument,” he said.

Bringing the plans below the tax threshold would require only slightly higher deductibles, he said, enough to make people more cost-sensitive but not enough to make them skip necessary care. “If you take people at the level where they’re spending $23,000, that’s not skimpy insurance, and . . . if you raise their co-pays or deductibles, that’s not going to adversely affect their health,” he said. “There’s literally no evidence out there that people are going to suffer.”

C-SPAN Urges Congress To Open Healthcare Debate

In October, WasteWatcher readers were alerted to the “read the bill” initiative being pushed by Republican lawmakers that would require all non-emergency legislation to be posted online in final form at least 72 hours before a vote. 

This project has since become part of a larger effort to promote transparency in Congress.  On November 19, House Republicans set forth five commonsense reforms that will shed light on the legislative process, making Congress more open and accountable to the American public.

The transparency resolutions would require all bills to be posted online at least 72 hours before they come to a vote; committees to provide bill text online within 24 hours of adoption; and, members’ committee votes to be shown online within 48 hours.

The resolutions also seek to open healthcare negotiations to the public and allow cameras into the secretive Rules Committee that decides which bills come to a vote.

In a letter dated December 30 (made available today), C-SPAN’s chief executive Brian Lamb urged House and Senate leadership to allow cameras inside the healthcare negotiation rooms:

Dear Speaker Pelosi:

Representative Boehner:

Senator Reid:

Senator McConnell:

As your respective chambers work to reconcile the differences between the House and Senate health care bills, C-SPAN requests that you open all important negotiations, including any conference committee meetings, to electronic media coverage.

The C-SPAN networks will commit the necessary resources to covering all of these sessions LIVE and in their entirety. We will also, as we willingly do each day, provide C-SPAN’s multi-camera coverage to any interested member of the Capitol Hill broadcast pool.

Since the initial introduction of the America’s Affordable Health Care Act of 2009 in the House and the Patient Protection and Affordable Care Act in the Senate C-SPAN has televised literally hundreds of hours of committee hearings, mark ups and floor debate on these bills for the public to see. And importantly, we have archived all of this video for future generations to study in the C-SPAN Video Archives.

President Obama, Senate and House leaders, many of your rank-and-file members, and the nation’s editorial pages have all talked about the value of transparent discussions on reforming the nation’s health care system. Now that the process moves to the critical stage of reconciliation between the Chambers, we respectfully request that you allow the public full access, through television, to legislation that will affect the lives of every single American.

We hope you will give serious consideration to this request. We are most willing to employ the latest digital technology to make the cameras, lights and microphones as unobtrusive as possible.

Please contact me if I can answer any questions.

Sincerely,

Brian Lamb

President Obama consistently campaigned for transparency and accountability, and the White House even released new agency “open government” rules on December 8.  However, Congress does not appear to be following his lead.

The Democratic leadership on Capitol Hill has rammed through multi-billion dollar spending bills without a moment’s notice, conducted secretive healthcare negotiations that result in “managers’ amendments” being added at the last minute prior to a vote, and kept deliberations about how legislation will be discussed on the floor of the House from public view.

Members of Congress are obligated to tell their constituents exactly how they are spending taxpayer dollars.  It is time they acknowledge that responsibility by agreeing to the GOP’s transparency proposals and by honoring Mr. Lamb’s request to open the healthcare debate to C-SPAN and the American public.

New Year; Same Bad Healthcare Plan

When President Obama spoke about a “model” for national healthcare, he cited several privately-run systems, including the Mayo Clinic, in an online townhall on healthcare held at Northern Virginia Community College on July 1, 2009. 

In his prepared remarks, the President said, “We have to ask ourselves why there are places like Geisinger Health Care Systems in rural Pennsylvania, or Intermountain Health in Salt Lake City, that offer high-quality health care at costs that are well below average, in some cases 30 percent lower than in other communities.  If they can do it, there’s no reason why all of America shouldn’t do that.  We’ve got to identify the best practices across the country; we’ve got to learn from those successes, and then we’ve got to replicate those successes elsewhere.”

In response to a question about medical malpractice, President Obama said, “There are some places, like the Mayo Clinic, many of you have heard of, provides outstanding care, some of the best in the world.  People fly in from everywhere to go to Mayo Clinic to get treated.  Turns out Mayo provides care much more cheaply than a lot of other health systems, even though it’s better care.  And part of the reason is they do some things that are commonsensical, but unfortunately we don’t do in the health care system. For example, instead of you going to one — your primary care physician, who has you do a bunch of tests, then refers you to a specialist who has you do a bunch of tests, then maybe you go to a third specialist, another bunch of tests; go to the hospital, they retest you.  What they do is, at Mayo Clinic, when you meet with the — your primary physician, he calls in all the specialists all at the same time, and as a team they evaluate you, do all the tests right there, so you’re not duplicating a whole bunch of stuff.  And that coordinated care drives down costs tremendously.”

It turns out this coordinated care, “some of the best in the world” as the President called it, is not sufficiently compensated by Medicare, the government’s largest existing healthcare program.  A December 31, 2009 Bloomberg article noted that the Mayo Clinic would no longer accept Medicare patients as of January 1, 2010 at its family clinic in Glendale, Arizona because it was losing too much money. 

The article stated that “The Mayo organization had 3,700 staff physicians and scientists and treated 526,000 patients in 2008. It lost $840 million last year on Medicare, the government’s health program for the disabled and those 65 and older, Mayo spokeswoman Lynn Closway said.  Mayo’s hospital and four clinics in Arizona, including the Glendale facility, lost $120 million on Medicare patients last year, Yardley said. The program’s payments cover about 50 percent of the cost of treating elderly primary-care patients at the Glendale clinic, he said.”

The Medicare Payment Advisory Committee in a March 2009 report  found that physicians had been paid 20 percent less for Medicare patients that for those with private insurance for the past decade.  As they have for several years, the House and Senate eliminated a proposed 21.5 percent reduction in Medicare physician reimbursement for 2010 by large majorities in November.  Nonetheless, the House and Senate healthcare bills are relying on future 20 percent reductions to help fund their new entitlement program following the one-year “fix” that will stop the cuts from taking effect this year.

Using Vulcan logic (because the whole Obama/Reid/Pelosi plan really is from out of this world, and not in a good way):  If Mayo (along with many individual physicians and smaller healthcare practices) is dropping Medicare patients because the providers are losing their shirts on the program, and the healthcare bills cut Medicare physician reimbursement to help finance the new entitlement program, more and more providers will drop Medicare patients, and those individuals will all end up in … the new healthcare entitlement plan.    Maybe members of Congress are more diabolical than anyone thinks.

Defense Bill Released

The final appropriation bill for Fiscal Year (FY) 2010, the Department of Defense Appropriations Act, has been released.  There are 1,719 projects worth $7.6 billion in the bill.  FY 2010 marks the first time that defense earmarks are below $9 billion since FY 2002, when the total was $8.8 billion.  Despite this decrease, the bill was still rife with waste, including:

  • $3,385,000,000 added anonymously for four projects.  This figure equates to 44.7 percent of the dollar amount included for earmarks in the bill.  According to the Honest Leadership and Open Government Act of 2007, signed into law on September 14, 2007 by President George W. Bush, members of Congress are required to add their name to each earmark.  However, they continue to violate this law by adding anonymous earmarks to fund projects – often big-ticket items – at the expense of taxpayers.
  • $2,500,000,000 added anonymously for ten additional C-17 aircraft.  In a floor statement posted on his website, Sen. John McCain (R-Ariz.) voiced his opposition to the C-17 funding:  “[w]hat we would do in this bill is effectively fund the purchase of new aircraft that we neither need nor can afford with critical sustainment money.  That would have a significant impact on our ability to provide the day-to-day operational funding that our servicemen and women and their families deserve.”
  • $465,000,000 added anonymously for the F136 alternate engine program.  According to a November 10, 2009 Reuters article, deliveries of the F136 alternate engine will be delayed by one year.  Built by General Electric and Rolls-Royce, the alternate engine program has had two major setbacks in as many months.  In October, F136 testing was halted when a nut came loose, damaging turbine blades in the engine.  Top military officials, former President Bush, President Obama, the Office of Management and Budget, and independent analysts all agree that the alternate engine should be eliminated.  The project is expensive, unnecessary, and only survives because of pork-barrel politics.
  • $250,000,000 added anonymously for advance procurement of components for the two DDG-51 destroyers planned in fiscal year 2011.  According to a September 29, 2009 Associated Press article, the DDG-51 destroyer is “to be built in Pascagoula, Miss., home to Republican Sen. Thad Cochran….”  Senate Appropriations Committee Ranking Member Thad Cochran (R-Miss.), Sens. Roger Wicker (R-Miss.), John Kerry (D-Mass.), and Paul Kirk (D-Mass.), and Rep. Travis Childers (D-Miss.) added $8,100,000 for a hybrid drive system for the DDG-51 destroyer.
  • $7,600,000 by Senate appropriator Jon Tester (D-Mont.), Sen. Max Baucus (D-Mont.), and House appropriator Dennis Rehberg (R-Mont.) for the MARIAH Hypersonic Wind Tunnel Development Program.  According to Sen. McCain, “The Air Force, leader in hypersonic testing and technology, lost interest in 2004, so appropriators moved the program to the Army.  The Army has no official requirement for this capability and published a report in 2005 stating their disinterest in the program.  To date, the Army has no plans to fund the MARIAH wind tunnel effort, as they have stated in their budget documents.  That hasn’t kept Congress from pouring more than $70 million into it, with no discernable return.  One group has made out well in the deal however.  Of course, I’m referring to lobbyists, including Gage LLC, whose CEO, coincidentally, had been a senior staffer to an appropriator from Montana.”

More Spending is Not the Answer

Last week President Obama outlined a “new” proposal to create jobs and jump-start the economy.  His plan: spend more money.  What a novel idea!  I think I’ve heard it before.

In a speech at the Brookings Institution, President Obama said he wants to expand the “stimulus” program and spend some $50 billion more on roads, bridges, aviation and water projects, and “weatherize” homes to reduce energy bills, among other things.  President Obama indicated that the $200 billion in unobligated TARP funds could be used to pay for the proposal. 

CCAGW has been a proponent of repealing unobligated bailout funds since TARP’s inception.  However, these are taxpayer dollars and therefore they should be used to pay down the nation’s ever-growing debt, not to finance another federal boondoggle.  

Americans have watched lawmakers throw stimulus dollars away on ridiculous projects, including a $5 million energy grant for a deserted mall, $2.2 for a water pipeline to a money-losing golf course, and $2 million for an 18-mile tourist railroad extension.  Of course, these are only a few of the highlights.  (Be sure to check out Sen. McCain and Sen. Coburn’s Stimulus Checkup for a good laugh (or cry) on 100 wasteful stimulus projects).  So by all means, let’s hand over another lump sum to the government for a “job creation” program.  What’s another couple hundred billion?

As it turns out, I’m not the only skeptic.  Today, House Minority Leader John Boehner released a list of 222 well-respected economists across the country that support reining in federal spending rather than moving forward with more “stimulus” spending.

The economists stated:

The country’s economic future depends on Congress’ ability to rein in the growth of federal spending.  Failing to restrict spending growth will further balloon the national debt, impede economic growth, and threaten the long-term economic health of our Nation.  Controlling spending growth to reverse our dangerous debt accumulation can be done without endangering the near-term economic recovery, and will prove beneficial over the longer horizon.

The 2009 near-term “stimulus” has proven to be an inefficient spur to job creation and does not merit repeating.  Any further policy efforts should be focused on opening borders to free trade, cutting burdensome regulations, and providing necessary tax relief to employers and employees.

I don’t need a Ph.D. to convince me that more spending equals more debt, but perhaps our nation’s lawmakers do.  Let’s hope they listen.

Microsoft and EU Come to an Agreement

The European Union (EU) has had an obsession with Microsoft. 

In March, 2003, the EC issued a decision requiring Microsoft to hand over valuable intellectual property to its competitors, unbundle its software, and pay a $600 million fine.  The company had to create two versions of Windows, one with Windows Media Player and one without.  Litigants argued that bundling gives Windows Media Player an unfair advantage over other media players.   But, the EC agreed with Microsoft’s argument that the media player has no economic value so the two versions will be sold at the same price.  That move was a bust, as very few people chose the unbundled software and technical issues arose, which Microsoft had predicted.

Now comes news of a an agreement in the EU’s latest attack on Microsoft.  According to the Washington Post:

The European Union has dropped long-standing antitrust charges against Microsoft Corp. after the company agreed to give users of the Windows operating system a choice of up to 12 other Web browsers.

Under the terms of the deal with regulators announced Wednesday, Microsoft will avoid further EU fines if it provides a pop-up screen that lets European users – from March – replace Microsoft’s Internet Explorer or add another browser such as Mozilla’s Firefox or Google’s Chrome.

The EU will continue to monitor Microsoft:

Microsoft is not totally out of the woods yet, as it was warned it can still be fined up to 10 percent of yearly global turnover without regulators having to prove their case if it doesn’t stick to this commitment for the next five years.

Neelie Kroes, the EU’s competition commissioner also stated that:

she was still looking at complaints from software rivals that the company wasn’t sharing key information that help others make products compatible with Microsoft software.

The irony is that the most non competitive entity (government) is investigating the most competitive entity (the private sector).

“Multibus” Released

On December 10, 2009, the House passed H.R. 3288: the Consolidated Appropriations Act for Fiscal Year (FY) 2010.  The $446.8 billion “multibus” consists of six of the seven remaining appropriations bill, including Transportation; Commerce, Justice, Science; Financial Services and General Government; Labor, Health and Human Services, and Education; Military Construction and Veterans Affairs; and State and Foreign Operations Appropriations Acts for Fiscal Year 2010.  The appropriation bill for the Department of Defense is still outstanding.

Compared to FY 2009, the legislation has a 12.5 percent increase in spending.  Measured against FY 2008, the legislation provides a staggering 24.4 percent increase, with State-Foreign Operations up by 48.8 percent, Transportation and Housing rising 39.1 percent, and Commerce, Justice and Science increasing 24.3 percent.

In terms of earmarks, the bills were filled with egregious waste, as usual.  Citizens Against Government Waste is currently analyzing the bills to determine the total amounts, but here is a sneak peak of some of the sillier projects:

Transportation-Economic Development Initiatives

  • $1,000,000 by Senate appropriator Judd Gregg for repairs, restoration and modernization of a theatre and construction of an additional space at the Portsmouth Music Hall
  • $400,000 by House appropriator Maurice Hinchey (D-N.Y.) for restoration and renovation of the historic Ritz Theatre
  • $400,000 by Rep. Yvette Clarke (D-N.Y.) for construction and renovation for safety improvements at the Brooklyn Botanical Garden
  • $350,000 by House appropriator Chaka Fattah (D-Pa.) and Rep. Robert Brady (D-Pa.) for renovation of the Uptown Theatre
  • $250,000 by Rep. Ed Whitfield (R-Ky.) for construction of the Monroe County Farmer’s Market
  • $250,000 by Rep. Michael Turner (R-Ohio) for building renovation of the Murphy Theatre
  • $194,000 by Sen. Sheldon Whitehouse (D-R.I.) for completion of the historic restoration project at the Historic Slater Mill
  • $150,000 by House appropriator Jose Serrano for Safe Harbors of the Hudson, Inc., for renovation and buildout of the Pregones Theatre
  • $100,000 by Rep. House appropriator Calvert (R-Calif.) for construction on the Santa Ana River Trail

Financial Services-Small Business Administration

  • $200,000 by House appropriator Marion Berry (D-Ark.) for the Arkansas Commercial Driver Training Institute at Arkansas State University
  • $150,000 by House appropriator James Moran (D-Va.) and Eleanor Holmes Norton (D-D.C.) for education programs and exhibitions at the National Building Museum in Washington, D.C.
  • $134,000 by House appropriator Dennis Rehberg (R-Mont.) for Montana Growth Through Trade at the Montana World Trade Center
  • $100,000 by Sen. Lindsey Graham (R-S.C.) and Rep. Henry Brown (R-S.C.) for the Myrtle Beach International Trade and Conference Center

Labor/Health and Human Services

  • $500,000 by Senate appropriator Tom Harkin (D-Iowa) and Charles Grassley (R-Iowa) for exhibits relating to the Mississippi River at the National Mississippi River Museum and Aquarium in Dubuque
  • $200,000 by Senate Appropriations Committee Ranking Member Thad Cochran (R-Miss.) for the Washington National Opera for set design, installation, and performing arts at libraries and schools
  • $150,000 by Louis McIntosh Slaughter (D-N.Y.) for exhibits and interactive displays at the Theodore Roosevelt Inaugural Site Foundation in Buffalo

Open Government May Not Be Open and Shut Case

From finding out which members requested which earmarks in the annual appropriations bills to detailed information about where the stimulus money is going, most Americans want and demand a more transparent (open) government.

The Obama Administration just released (December 8, 2009) it’s new Open Government directive:

The three principles of transparency, participation, and collaboration form the cornerstone of an open government.  Transparency promotes accountability by providing the public with information about what the Government is doing.  Participation allows members of the public to contribute ideas and expertise so that their government can make policies with the benefit of information that is widely dispersed in society.  Collaboration improves the effectiveness of Government by encouraging partnerships within the Federal Government, across levels of government, and between the Government and private institutions.

Transparency seems simple enough.  Show us the money (I apologize for the over used Jerry Maguire reference).  While strides have been made there is much more work to do.  Members of Congress can still request earmarks without identifying who requested them and the stimulus website, recovery.gov, still has alot of work to be  completely transparent.

Collaboration is a bit tougher.  There are so many turf wars within every level of government you would think it was a version of West Side Story.

Participation is the most intriguing of the three.  For many years CAGW has encouraged more citizen participation in government.  What CAGW thinks of participation may differ from what the Obama Administration thinks of participation.  According to the directive,  “Participation allows members of the public to contribute ideas and expertise so that their government can make policies with the benefit of information that is widely dispersed in society.”  Sounds  reasonable but they should keep in mind that any new “technology” or IT solution should not weaken well established privacy and security standards.

Pursuing a more open government is a noble gesture and idea but it should not be done so at the expense of taxpayers’ safety and security.

The pursuit of an open government should be done with an open mind.

Obama’s Multiple Trips Waste Money

Yesterday, President Obama delivered a speech in an attempt to claim he is focused on the economy and the massive number of job losses since he took office.  I guess he will read anything put on a teleprompter in front of him regardless of how far it is from reality.

In his speech, he stated “We’ve combed the budget, cutting waste and excess wherever we could.”  Remember that earlier the spring of 2009, President Obama ordered the governments to find $100 million in waste to cut almost concurrently with him signing a $787 billion stimulus bill.

Citizens Against Government Waste has repeatedly pointed out billions of dollars in wasteful existing programs and new programs funded by the stimulus bill.

But if I recall correctly, President Obama said that the reason he was going to burn thousands of gallons of jet fuel to visit the climate change conference in Copenhagen was because he would already be in the neighborhood, picking up his Nobel Peace Prize in Oslo.  Therefore, it would be very efficient of him to swing by Copenhagen.

Now we learn that President Obama would prefer to be in Copenhagen on a different day.  Thus, he will burn additional thousands of gallons of jet fuel to visit the climate change conference in Copenhagen a week later to read a speech on a teleprompter about the importance of everyone else not burning fuel so we can save the planet.

On top of his ironic and grossly inefficient energy use to attend the climate change conference, is the waste of taxpayers’ money.  As I pointed out during his last trip to Copenhagen in October, the average cost of operating Air Force One is estimated at more than $100,000 per hour, the total to fly the president to Copenhagen was more than $1.5 million.  That does not include the staff time being diverted from other uses.

I guess this was a bit of waste that did not get caught in the comb.