Greatest migration since WW2

IMMIGRATION HAS BECOME GLOBAL ISSUE

CRISIS WORSENS IN EUROPE

Watching some of the Republican debate the other night, it was obvious the conversation about illegal and legal immigration has become a very controversial issue. The United States has had a lax policy on enforcing our borders for many years. In the early days of the Republic it was common for people to cross between Mexico and the United States without checkpoints or regulation. Most of the early populations of Texas, New Mexico, and Arizona were there before those states became part of the US. I doubt that many would now choose to become part of Mexico. Of course, in the early days we did not have welfare, public education, food stamps or any other socialist programs. This is where the problems began. There have always been migrant workers that crossed the border for work. This benefited both Mexican laborers and US employers. As the US expanded the benefits that are available, more decided it was better to stay and take advantage of those benefits here because they were far superior to any across the border. There are many people who advocate open borders without limits, including libertarian advocates as well as politicians with other agendas. Many businesses like the fact that immigrants depress wages in all labor type jobs. Most Democrat politicians want to issue drivers licenses and give legal status so they can add these people to the voter rolls and then use the threat of  deportation to keep the migrants voting for them. There are probably 30 million people south of the border who would enter this country if they perceived it to be risk free. If anyone believes we could absorb this many mostly uneducated unskilled immigrants and their children without a straining of the social services of this country and a general lowering of the standard of living of resident Americans, they are in fantasyland. In the 1980s President Reagan agreed to a package of immigration rules that legalized 3 million illegal immigrants with the understanding that the borders would be secured and this was a one time deal. The immigrants were legalized, but the border was not secured. This is why immigration reform failed in the last few years - because no one believed that Obama would ever secure the border and another 10 million would be legalized.  This would encourage another 30 or 40 million to head for the border. It is now assumed that no further action will be taken on this until the border is secured and the visa programs are upgraded.

In the last few years we have watched as thousands, and maybe millions, of uncontrolled immigrants and refugees have headed for Europe. One of the rules of the EU is that people can cross the borders of member countries without regulation. If they can make it to a member country like Greece they can then travel wherever they want in Europe. You will take notice they are not trying to get to Russia or Poland or other countries without universal social services. Members of the EU must provide services to refugees according to their charter. It is no wonder that most have set their sights on Germany, Sweden, Denmark, and those countries with the most liberal benefits. I watched an interview with a Middle Eastern immigrant on C-Span - he was living for 9 months in an isolated apartment building in Germany with others and they were receiving food, medical care, and a monthly check. He stated he had yet to have a conversation with, or had seen, a German. We have seen the New Years Eve attacks in Cologne, Germany where hundreds of women were being attacked, abused and raped by young immigrant men.  It has been common practice of these young men, who do not share western values concerning women, to grope any women who is available.  We now see that the governments of Europe are beginning to question the situation and are deporting and restricting the increase in migrants. This situation has slowed for now, but when spring arrives, I would not be surprised if we will see more restrictions and eventually the deportation of large numbers of these people. It will then become a crisis beyond imagination.
 

We have just focused on the quantitative problem of the influx of immigrants, not even mentioning the possibility of potential terrorists from the Middle East and the agents of the drug cartels from the south. There is also the problem of human trafficking of the poor people who are just trying to find a better place to live. A strict control of our borders would allow a systematic and regulated legal immigration in numbers that could be assimilated into our system in a orderly way.  While we now have a serious problem with illegal immigration, not just across the southern border, but from many parts of the world, including refugees from the Middle East, we still have the opportunity, if we take action now, to keep this a manageable problem that will not be a risk to our social and economic well-being. 

Detroit public schools,a glimpse of the future?

DETROIT SAGA CONTINUES

DETROIT TEACHERS SUE STATE

Detroit has been in the news for some time...ever since it declared bankruptcy in 2013. After the city went into default and no recovery was in sight, the governor appointed an emergency management team to run the city.  Detroit is the 4th largest city in Michigan; some have said it was the richest city in the nation in the late 1940s. Unfortunately, the city has been in free fall since the late 1960's - particularly after the riots of 1967. While Detroit was losing some population earlier, after the 1967 riots it became a flood. In 1942 the black population was 4%, by the end of the war 15%, by 1960 16%, by 1970 only 3 years after the riots it was at 45%, and by 1980, it was 66%. There was a period of racial strife in the city and lawsuits by racial organizations for one reason or another. The affluent white population felt that it was in their best interest to move to the suburbs. In 1973 Coleman Young became the first black mayor of the city. In an attempt to rebuild the city there was much use of federal grants for urban development, including stadiums, and displacing many residents by using eminent domain laws to make way for large building projects.

The 70's and 80's saw large increases in crime connected with the cocaine and heroin epidemic. This, coupled with rampant political corruption in contracts and nepotism in the city administration, led to a further decline in the city. In 1991, violent crime rate rose to 2700 crimes per 100,000; in 2003 the arson rate was 6.3 times the national average and murder was 5.1 times the national average. In spite of millions of dollars of aid for rebuilding the city, it continued to decline. The cycle of population decline and then the raising of taxes to regain revenue, followed by more declines and more taxes, resulted in the raising of 5000 vacant homes in 1990 alone. The population has dropped from 1,849,568 in 1950 to 713,777 today. The current population is 82% black, with only 75,758 white residents left in the city. Whole sections are either vacant or have been bulldozed for safety reasons. A program where people could acquire a home for $1.00 had very few takers. This is a sad story of a once great city. There is plenty of blame to go around, but there is little hope for the future.

In the last few weeks we have heard of teacher sick-outs in Detroit to protest poor pay and conditions in the Detroit public school system. The Detroit public school system was taken over by the state in 2009; the administration was replaced by a emergency manager. This was done to stop the bleeding and try to reverse the financial situation in the district. Enrollment declined from 167,000 in 2000 to 47,000 in 2015. Total debt is now $1,291,993,617. It has run over a $100,000,000 deficit each year for the last 10 years. The deficit this year is expected to be $166,000,000.  The district is $53,000,000 behind in their pension payments, with a daily cost of $7600 a day in interest and penalties. They have been behind in payments since 2010.  The elected school board has only been allowed to deal with education with no control of finances as they have had the policy of spending money with no respect to reality. The superintendent, Karen Ridgeway,  has held the post for 30 years. The per-pupil revenue is $12,931 and the per-pupil expense is $14,444 which are both much higher than the statewide the per-pupil revenue ($9912) and per-pupil expense ($9703).  Instruction expense in Detroit is $9051 compared to a statewide amount of $6859.  Per-pupil administrative expenses are $4159 in Detroit compared to $2525 for the state. The school district is locally financed at 23.6%, State 52.3%, 24.31% federal. Some years ago they had to stop financing with real-estate taxes as they would have decimated the city further.

The teachers union has sued the state to remove the emergency manager, because they want a pay raise and the schools are deteriorating to the point of concerns of health and safety. The state has pledged $715,000,000 over 10 years to improve the schools, but it is unlikely there are any good results in the offing. There is little chance that the tax base will be expanded or that anyone will agree to make the schools more efficient to bring costs into line with the rest of the state. The declining enrollment leaves everyone behind the curve in keeping costs in line with income available. One has to wonder if this is not a glimpse of the future for other places in the country.





 

Both parties melting down

THE GREATEST SHOW ON EARTH

WILL THE MAJOR PARTIES SURVIVE AFTER 2016?

  

The 2016 Presidential election, while still in the pre-primary season, has captured worldwide  attention. We see proposed bans of US presidential candidates in Britain and comments by Vladimir Putin on the US election, all this while not one vote has yet to be cast. This has been the most watched primary that I can remember and it may well go down as having the largest voter participation in US history. Much of this can be attributed to the candidacy of Donald Trump and to a slightly lesser degree of Bernie Sanders. Both candidates have distressed their parties to a point of obvious breakdowns. We see Hillary Clinton, the presumed nominee, labeled as the "establishment" candidate, which she is. She was billed as the "Wonder Women " of the Democratic party and she has turned out to be the poorest performing candidate they have put up since Michael Dukakis. We also hear howls of outrage when Democratic support groups are labeled "establishment" by Bernie Sanders, which they are. We see Hillary labeling Sanders, who calls himself a socialist, as being too conservative on the issues. The usual labels are not working this election cycle. The voters like Sanders, who has the credibility that Hillary will never have. I  have questioned his wanting to win, maybe Bernie has finally seen the light and realizes that maybe he can actually win this election. 

On the other side we have Trump, who has been called everything from bigot to Islamophobic to not a real Republican,  but it has not put a dent in him so far. They all predicted how he would wilt when his plans were exposed to daylight. The whole pack of candidates then confronted the alpha dog of the pack, and they were soon tearing at each other, fighting for the scraps of votes left after Cruz and Trump solidified their positions. One by one they attacked and were sent to the rear of the pecking order. Giving up on the establishment candidates to knock him down, they have now enlisted the self-described spokesmen for conservatism in the likes of Rich Lowery, National Review, Bill Kristol, Weekly Standard, David McIntosh, Club for Growth, David Boaz, Cato Institute, Eric Erickson, Red State.com. and many others. They have even allowed Glenn Beck, who up to now they would have not gotten onto the same stage with, to endorse their plan to stop Trump.  Beck, a supporter of Ted Cruz, who is a good man, has allied himself with the Jeb Bush supporters to stop Trump. Does he really think that if Trump is destroyed they will support Cruz?  Now they have even had Bob Dole come out and say nice things about Trump, this must be a Machiavellian  attempt to damage Trump. What can they promise Bill Cosby and Charles Manson to endorse Trump? Trump's and Cruz's opposition has been strongest among the Republican elites. They still have hopes for Jeb Bush. He was supposed to be the "Superman" of the Republican party, but turned out to be more like Gomer Pyle. It was all about the money; he had the most to spend and everyone was expecting some of the largesse to flow their way. He has spent over 100 million to the combined 8 million of Trump and Cruz. There is a depression in the Republican consultant class. 

Now, what do Trump and Sanders have in common that has the establishments of both parties melting down? Number 1 is trade - both believe in real fair trade that will help American workers raise their standard of living. No one seems to talk about the facts that China has tariffs on American products and requires turning over plans and intellectual property to the Chinese government for products made there. Both will also re-examine our interventionist foreign policy. I believe this is the crux of the opposition. The huge amounts of money that are dependent on these two policies, whether it is buying sneakers in China for $5.00 and selling them for $100, or Smart Phones for $85 and selling them for $500. These trade policies were passed during the Clinton presidency and supported by Democrats and Republicans. We have military personnel stationed in over 100 countries. There is lots of money to made on these policies. Both policies have been consistent for years with both parties and both Democratic and Republican administrations. We have been brainwashed for years that nationalism is a bad policy, equated with fascism and extremism. It's like saying making your priority the well being of your children and families is extreme.

We will see how this all plays out. It will be a show that no one could have made up, this may be the Super-Bowl, World Series and Daytona 500 all wrapped up in one and there are 10 more months to the checkered flag. 

Pennsylvania Teachers Pension Fund Crisis Escalates

AUDIT  FACTS  FOR  NORTHWESTERN  LEHIGH SCHOOL  DISTRICT

PENSION SYSTEM NEEDS REFORM NOW

  

The Northwestern Lehigh School District Board received the auditor's report at its monthly meeting last night.  The good news is that everything came up as adhering to acceptable accounting standards without any major errors or deficiencies. This deserves recognition for a job well done by the competent members of the business administration.

Total revenues from local, state, and federal	$38,515,322
Total expenditures	$36,370,108
Surplus 2014-2015	$1,645,214
Total assets: buildings, furniture, cash, etc.	$94,777,864
Total liabilities Bond debt Pension debt Other debt	$46,217,832 $50,329,108 $997,905
Total debt	$97,544,845
Net assets	(-$2,766,981)

The total debt is now 250% of income; in the private sector this would require bankruptcy.

The big item in the overall audit is the $50,329,108 pension liability apportioned to this school district. This is an increase of $1,212,986 from the previous year. In the 6 months, since the end of the fiscal year, this liability has increased to $51,190,653 - an increase of $861,545 in 6 months. While half of this amount is to be reimbursed by the state, it is the school district is responsible for this liability. The percentage of the teachers' salaries that is to be contributed to the pension by the school district is now 30.03%

This is an unsustainable situation. The return on the pension fund investments has averaged 50% of the return required to be viable. With the downturn in the stock market, this situation may explode to literally bankrupt every school district in the state. The intransigence of the school teachers union to embrace any reforms to this out-of-control pension system will not end well for them or for the taypayers.



AMERICAN CORRUPTION APPROACHING THIRD WORLD LEVELS

ALLENTOWN CORRUPTION JUST ONE EXAMPLE

CAN YOU IMAGINE WHAT IS POSSIBLE IN HARRISBURG AND WASHINGTON?

While local focus is on the alleged corruption in kickbacks and the awarding of contracts in the Pawlowski administration, it is indicative of a widespread pattern of corruption in many aspects of American life. The old saying "where the money is the vultures will be circling," has never been truer. The most money available for unchecked disbursement is in government. It has been common   knowledge for years that jobs for supporters both Democrat and Republican are available on the Bridge Commission and Turnpike Commission. Is it any wonder that fees on the turnpike seem to rise on a monthly bases even as the traffic is at an all time high? We have seen where actual votes in Congress were openly obtained by openly promising benefits for people back home - there should have been handcuffs for both sides of these deals. Trading of votes, " you vote my pork barrel law and I will vote for yours," should result in more handcuffs. Can anyone imagine the possibilities for abuse in the awarding of contracts and kickbacks. When one sees what is possible on a small scale in places like Allentown, it is overwhelming what is possible in Harrisburg and Washington. Washington has been in a boom era forever. It has the highest real estate prices and highest standard of living in the US...thanks to taxpayer money. While corruption at local levels is usually limited to paid trips to the Caribbean, hunting trips, free tickets to professional sports event, jobs for incompetent family members and wining and dining, at the state and national level it is a smorgasbord of all that is imaginable. We have seen trips and weekend retreats in Las Vegas and other places were whole divisions of government are able to enjoy the benefits of government work. Does anyone doubt that there is waste and abuse, which if eliminated, could save taxpayers billions of dollars?  Government today is more and more appearing like the ruling aristocracy of the monarchies of Europe.


While government corruption is all about money, let's not forget the corruption of the media. We have seen NBC news actually alter the 911 tape in the Zimmerman case to make Zimmerman's actions to appear racist and pre-meditated. Was this to enhance a good story or for political gain of the people they support? We also saw the phrase "Hands up don't shoot," still being perpetuated by the media today even though it was proven to be a lie from the beginning. We also see that Trump's proposal to temporarily stop all entrance of Muslims to enter the country, until there is a process to properly vet them, was turned into," Ban Muslims from the country." At the same time similar proposals concerning refugees have passed congress with little fanfare. It is not only in the US. I watched the debate in England yesterday to ban Donald Trump from the United Kingdom (which they will not do) at the same time that Britain has all but stopped immigration from the Middle East and the Prime Minister has demanded all Muslim women learn to speak English. I hope Trump has kept a record of the process, and we will see what happens when those that perpetuated the lie would like to get a tee time reservation at one of his golf courses in Scotland.  Also, if he should become president, only agree to meetings in Ireland.  How about watching Hillary Clinton's televised hearings on Benghazi where she is caught red-handed in lying to Congress and the media announces what a wonderful and successful testimony she gave. Is it any wonder that the credibility of the media is at an all time low?

We also see Attorneys General, both at the state and federal level, publicly refuse to obey the law. We have watched as the President of the United States has habitually refused to obey the Constitution and the "Law of the Land." We have seen that Congress is too timid to demand that the laws of the country be enforced and obeyed, while the courts have re-written legislation and expanded the role of the federal government, which any literate person could see is not what the Constitution intended. We have forgotten that the Constitution is the "Law for the Federal Government." Unfortunately, as things stand now, there is really no law of any consequence that cannot be blown off as not applicable to those in power. If this trend continues and the precedents are set that some court can use to justify this increase in power, what will remain of our system of laws and government? While some may be happy what these expansions have done for them, they may be very unhappy when the same type expansions will be done to them.

There is only one group or entity that can demand that the law is enforced, that the corruption is ended, that honesty is returned to all parts of our society....and that is the people themselves. The tactics of the elites are that you may not talk about this or that, whatever they shall decide is too offensive or divisive, they keep things quiet and behind the scenes so they can enrich themselves with either money or power, while everyone else is fearful of being labeled with the useful labels to quiet dissent. We need to thank God and the fathers of the Constitution for the first amendment and it is our duty as citizens to exercise that right at every opportunity.

Global slowdown underway.

2016 COULD BE END OF EXPANSION

GLOBAL SLOWDOWN UNDERWAY

The 2015 storm clouds for the economy look like they may accelerate in 2016. It has been 7 years since the great recession. While it has been a weak recovery, there has been a steady increase in economic activity, caused mostly by less fear and more confidence in the economic outlook. The biggest driver in the economic downturn has been slower economic growth in China. China has been the major engine of the global economy for 20 years. It has also been financed by a large amount of debt. Some of this slowdown was intentionally planned by the Chinese government, but now some question if they may have lost control of the decline. The first casualty of the Chinese slow down has been commodity prices, which are down 80% since 2002. Low commodity prices have resulted in slowdowns in all commodity producing countries, from Africa, Australia, South America,  and Canada. This has contributed to recessions beginning in these countries. At the same time, many of these commodity producers have large amounts of debt; if these low prices persist this can lead to a spillover into banking problems and bond defaults. China itself has devalued its currency several times to stimulate exports. It may at sometime need to lower its holdings of foreign currency reserves which could raise interest rates in the US.

The energy market is another part of this slowdown. While the low gas, diesel and heating oil prices have been a great stimulus to a flagging economy, (could you imagine this decline with $4.00 gas?) this again is partly a planned decline by the flat out production of OPEC to drive US frackers out of business and put pressure on their political enemies. Forty two US producers have filed for bankruptcy so far and 50% of energy-related bonds are in danger of default. This is resulting in large layoffs in this industry that will have a ripple effect across the economy. Oil wells are now being shut down as pumping marginal oil is actually resulting in a loss. Similar to what happened to beef prices after a decline in beef production, we will sometime see a huge increase in oil prices as demand again outpaces supply. These low oil prices may also kill alternative energy producers.

Another casualty is that many foreign governments and industries have debt that is denominated in US dollars. With the large increase in the value of the dollar compared to their currency, some debt repayments have grown up to 75%. This again is likely to result in defaults and bank losses.

Retail sales in the US have managed to see a steady year in 2015. Auto sales have reached a new record high, but some have concerns about the fact that most loans are now 72 months and 40% of loans would be classified as sub-prime. Auto sales have most likely reached their peak in this cycle.

The stock market started out with the weakest performance in many years. While this may be just an overdue correction, the fact is that many companies have borrowed money to repurchase stock to keep their stock prices up. Also many have valuations that resemble 1989 Japan.  The stock market has been aided by the fact that there is no where to earn a return on money these days. If not the stock market then where? This is going to put additional pressure on many public pension funds which have not been producing satisfactory results for years.

One other concern for 2016 is the refugee crisis in Europe, which will definitely increase budget deficits in countries with already huge amounts of debt.

While cheap energy prices are a welcome gift to most consumers, we will have to see if they are offset in the long run with a decline in economic activity and financial problems for those with large debts.

Middle East chaos part 5

HOW DID WE GET HERE?

MIDDLE EAST CHAOS  Part 5

THE OBAMA/CLINTON YEARS

We have seen that cold war diplomacy and the reaction of traditional Islam to reforms that appeared to move the culture of the Middle East to embrace western morality were both causes of unrest. The motive of western diplomacy until recently has been to maintain a balance of power with the Soviet Union and to help foster a stable environment that would insure a reliable source of energy for the western world.  While we can be assured that there were excesses and manipulation for financial interests, it has been the reality of human existence that power is used for good and evil.

The first Gulf War set up a series of events that once initiated have been difficult to control. The second Gulf War and the attempt to impose democracy on a foreign country has definitely contributed to instability in the Middle East. We humans have a hard time believing that other civilizations may not see life through the same prism as we do as evidenced by the well-intentioned Bush plan to bring a new Marshall plan to the Middle East, however, this is a flaw in human perspective that is hard to overcome.  Defeated Japan and Germany after WW2 may have seen the superiority of the United States system to be emulated, but I am sorry to say that the view of the United States in the last 30 years has deteriorated. We are no longer viewed or envied by many as having the high moral ground, but instead some see us as an example of what a lack of religious belief and unbridled materialism will lead to; this has lead to the belief among some that all things "western" must be rejected.  While many reject that assumption, that view has increased in many areas of the world.

  

After his election in 2008, one of the first speeches Obama gave was in Egypt.  I recently re-read that speech and I did not find it offensive to America and was a positive signal to the Middle East. Like so much with Obama, his actions have not matched his words. The first crisis was the 2011 revolution in Egypt, encouraged by the Obama administration, to the point of having young activists from the United States on the streets of Cairo, some were killed and some were arrested. While Mubarak was an authoritarian ruler, the Egyptian society was the most stable and inclusive in the Middle East. The rights of Christians and other minorities were protected. Their relationship with Israel was the best in the area. Nevertheless, the Obama administration encouraged the overthrow of the Mubarak government. Old and weak, Mubarak resigned and elections were scheduled. Obama had people lobbying for Mohammed Morsi and the Muslim Brotherhood and they were successful in the elections.  It was not long till the negative rhetoric against Israel increased, minority religions were persecuted and there seemed to be a move to install a strict form of Sharia law. There were protests and demonstrations in the streets of Cairo, the Egyptians did not want to go from a dictator to a worse result. The military stepped in in July 2013 and arrested Morsi and all his cabinet. While, as Obama lamented, this was the elected government of Egypt, if the Brotherhood could have been allowed to solidify its position, the results appeared to be catastrophic for Egypt and its neighbors. It should be noted that as many as 6 of Obama's appointees are linked to the Muslim Brotherhood. This will need to be a discussion for the future.

The next crisis began in February 2011 in Libya. Mohamar Gadhafi had been ruling Libya since 1969, when at the age of 27 he overthrew the king of Libya, His reign was similar to many in the Middle East - brutal repression of dissidents and a large well financed military. While under his reign income reached to the highest in the area and education standards were raised, he also supported revolutions and insurgents in the area and funded international terrorist activities around the world.  The 2011 revolution had a series victories and was moving on the capital Tripoli. The Gadhafi regime upped the response and was in the process of putting down the rebellion when the UN and the Obama administration provided air support to the rebels. Gadhafi himself, old and somewhat feeble, was replaced by his son, Saif-al-Gadaffi, at least as spokesman. He explained they were besieged by at least 15 rebel groups and proposed reforms and elections in the future. Gadhafi had cooperated with the Bush administration in 2003 by letting inspectors and allowing western oil companies to work in the country. Obama and Clinton doubled down and supplied weapons to the rebel groups, many who were associated with Al-Quada and local Islamist groups. Eventually Gadhafi and his sons were killed and the country is now in the midst of a power struggle for control.  It seemed that they were hell-bent on overthrowing Gadhafi without any plan for what was to replace him.

The Syrian civil war began in January 2011. The Bashar Assad régime was similar to other governments in the Middle East, they used brutal suppression of all opposition. This started out as suppression of protests and escalated into an all out civil war. Assad was supported by Iran, Iraq and Hezbollah; the civil war soon became more complicated as ISIS and other radical groups also got involved. The rebels were supported by the US and other western countries. As the atrocities committed by ISIS became more obvious, support for the overthrown of Assad weakened with many, fearing after he was overthrown ISIS would fill the void. As Assad was losing more ground, Russia stepped in and brought air support and advisers to support Assad. Russia would not like an Islamic Caliphate on their southern border. This basically bring us up to date on how we got here. I know that this is a complicated and controversial subject. I have tried to put it all together in a brief and easy to understand way. I hope that it has been useful to those who wonder how this all transpired and how we can deal with it in the future. I will be posting news on this problem as it occurs.