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Menampilkan postingan yang diurutkan menurut relevansi untuk kueri subsidies. Urutkan menurut tanggal Tampilkan semua postingan
Menampilkan postingan yang diurutkan menurut relevansi untuk kueri subsidies. Urutkan menurut tanggal Tampilkan semua postingan

Obama Escapes from Bizarro World! Demands Higher Taxes in order to Lower Cost of Gas

Bizarro World escapee Barack Obama (currently President of the United States) has called for an end to end $4 billion in subsidies for small companies that produce oil and gas for consumers, saying “You can either stand up for the oil companies, or you can stand up for the American people."

This latest effort to raise the costs of doing business on oil and gas companies is in response to the soaring price of gasoline in the United States, a development that will choke off the feeble recovery this nation has experienced under Obama's leadership.

Despite extensive research, it is still unclear exactly what Obama would cut that adds up to '$4 billion in subsidies', but based on past proposals Obama would likely cut out tax breaks that oil and gas companies receive for buying more efficient refining and industrial equipment, for creating and keeping manufacturing jobs in America, for costs related to repairing wells for safety, for encouraging more environmentally-friendly oil extraction, and for searching out and discovering new sources of oil.

Even though Obama pretends to support all of the stuff that the tax breaks go for, he doesn't like oil companies for some reason, and so he is going to make it more expensive for oil companies to do business in the hopes to lowering the costs of gasoline at the pump. If this makes no sense to you, you just have to think like Barack Obama and remember that up is down, good is bad, successful is wrong, laziness is a virtue, higher costs to produce somehow make a product cheaper, and demonizing others is okay if you're doing it but wrong for others to do.

President Obama though does not demand an end to all subsidies- only for an end for subsidies for companies that he personally does not like. Obama practices crony capitalism, whereby companies that give him political support in the form of campaign contributions get large subsidies, and companies who give money to his opponents (like the Koch brothers) are demonized and attacked. In the game of political power, President Obama intends to win so that he and his family and supporters and friends can benefit financially. Oil and gas companies oppose him because they want to provide cheap energy for poor people and manufacturing while making profits that are then distributed to shareholders and investors and they see Obama's policies as running counter to these ideas, and for their opposition Obama attacks them. So-called 'green companies' on the other hand cough up money to him and so receive substantially greater subsidies.

To wit, from John Hinderaker at Powerlineblog:

As the graph shows, in terms of per unit production, solar and wind companies receive considerably more subsidies than oil and gas, making support for these 'green' industries considerably more expensive, and thus wasting valuable resources like time and money that could have been spent curing cancer or building flying cars. It is not efficient or resource-usage friendly to support solar and wind energy, and yet Obama does, because executives and employees who run and work for these companies provide him with considerable campaign finances, which he then uses to maintain power for himself and redirect greater sums of money to his picked friends in those industries.

In this coming election, the left-wing that has seized control of your parent's Democratic Party is going to try to make this election about how Romney is successful, about how Santorum has good moral values, about how conservatives want people to pay their own way in the world, or about how some people make money providing cheap and efficient energy. They are going to make these things into bad things, and then make you feel bad if you write that they are actually good things, and they are going to pressure companies and individuals to say what the political power wants them to say. You are going to have to ignore all of this, and instead vote against tyranny- you need to vote Republican in the coming election and send Barack Obama back to Bizarro World where he belongs.

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A Conservative Approach to Energy Development

One of the cornerstones of modern-day conservatism is the belief that America's energy resources can and should be responsibly exploited. This means that the United States should allow private companies to drill for oil, mine coal, build nuclear power plants, tap into natural gas reserves, get shale oil, and utilize whatever other energy resources that these companies wish to use, provided that they respect the property rights of others.

Oh, I know what liberals and left-wingers will say- the horror of pollution! But the faults of energy development do not lie with the companies themselves, but rather with the government for not establishing clear and defined property rights- for example, rather than having the government act as police to safeguard public water, the water rights should be more clearly defined and if companies destroy or harm the property (the water) of others, they should be forced to pay in a court, much as if they destroyed other private property. The faults with 'pollution' then lie not in the companies for breaking ever expanding government rules and regulations over ever expanding public lands, but for the government for not putting in place limited and clear rules regarding private property rights and then divesting itself of public lands by selling these lands off to private entities that can then do a better job of protecting. Like most problems in our society, the solution is less government, not more.

With the main liberal concern out of the way, our nation would be free to exploit and use its vast resources- enough oil for 30 years, enough natural gas for 575 years, enough coal for 500 years, etc. With oil, gas, and coal be utilized to its fullest extent, our nation will have cheap and plentiful energy, enabling it to develop some of the most amazingly energy intensive industries there are- 'renewable resources'. The horse needs to go before the cart here- we  need to have cheap and plentiful energy in order to build the energy intensive operations and industries like building solar panels, developing batteries, building geothermal plants, etc. A wealthy, productive society thriving on cheap energy can afford to become environmentally friendly, as opposed to a cheap, declining society that the liberals and Democrats appear to be pushing us towards with their anti-energy policies.

In a free market, one in which the government is not subsidizing any of the industries (and this includes cutting subsidies for oil and gas and coal), the most efficient energy resources will be developed in an environment that encourages private property ownership and protection. American can be great again, if it moves away from the liberal model of public ownership of lands and public protection of the environment with restrictive regulations and rules and taxes on energy production combined with subsidies for 'favored' industries and campaign donors. It can be great again if it moves towards a more conservative model of private ownership of lands and private protection through impartial courts of the environment, with few restrictions and regulations and subsidies on energy production, encouraging the most efficient producers and users of energy in a free market.

Via Powerlineblog's post AMERICA’S VAST ENERGY RESOURCES I read this quote from the Institute for Energy Research. IER describes the problem (and the opportunity) bluntly:

Access to affordable, abundant energy is, fundamentally, a means of freedom. But for those seeking to create a crisis that provides an opportunity to direct the way we live, work and act, affordable, reliable, abundant, domestic energy is a threat. In a very real sense, the more energy we have, the less power they will have. Energy abundance ends the justification for central energy decision-making.

As it turns out, many of the problems of energy scarcity and rising costs in the United States have been caused by the government itself. In 2004, the U.S. Department of Energy issued a report that outlined many of the policy and regulatory constraints that impact domestic energy production. While the report focused on natural gas specifically, many of the laws and procedures also represent roadblocks to any form of safe and responsible energy production. The list of energy barriers included the following policies, all of which can limit access to U.S. resources, increase delays related to exploration and production, and/or increase costs of development:

(John from Powerlineblog)The list of statutes and other legal impediments that follows is three pages long. Only liberal politicians stand between the American people and development of our vast energy resources.

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Democratic Aide implicated in Scheme to Bilk Millions out of taxpayers through Michigan Film Credits

For a long time, I've had my doubts about the Democrat's much-touted subsidies and tax credits for filmmaking in Michigan. Most of my doubts center around the fact that these subsidies are being given away with very little oversight and are being given away to those with political connections (for example, Michael Moore sits on the board that recommends who gets these tax credits- and recently gave them to himself). This lack of transparency and political favoritism has not received the attention it should, because hidden behind the wall of secrecy that is the Democratic-run Film Office, there are a lot of corrupt deals being made that are screwing taxpayers over. Now it is confirmed though.

Breaking News: The chief-of-staff for a Grand Rapids Democratic State Congressman has been implicated in a million-dollar fraud scheme whereby he would buy a $4 million dollar building for $50 million and then apply $12.5 million dollars in subsidies through the state of Michigan's disgraced Film Office.

Noah Seifullah, who has been forced to resign from Congressman Robert Dean's staff, was in the process of finalizing the details of the Hangar42 studio scheme when the news broke. The Michigan Film Office had already given preliminary approval to the request for over $10 million in film-credits when the news broke.

This Hanger 42 scheme represents just the tip of the iceberg into the corruption that is rampant in the Michigan Film Office, so much so that Janet Lockwood, who is the director of the Michigan Film Office, is being forced to resign amid the growing criticism. Her office has stonewalled efforts to find out more information about the Hanger 42 deal, and many others, and she has attempted to provide citizens as little information as possible about the decision making process involved in the give-away of millions of taxpayers money.

The Mackinac Center was the first to publicly raise questions about the Hangar 42 deal with an essay and investigative video posted on its website May 20. They reported that the studio was on the market for as little as $9.8 million as late as February, but apparently sold for as much as $40 million not soon after that in order that the buyer could claim a much larger film-credit. As of today, the Michigan Film Office, the Michigan Economic Development Corp., the seller and the buyers are all unwilling to answer questions about this scheme, and the Democratic Governor who is so proud of her Film Office (and even bragged about the Hanger 42 deal as evidence of the success of the film-credits in her recent State-of-the-State speech) nor the Democratic-controlled Michigan Legislature have pressed for answers or explanations.

The Grand Rapids Free Press deserves a lot of credit for putting this story together and piecing together the details here. They found the speech where Noah Seifullah outlined a 'hypothetical' situation whereby massive amounts of fraud could bilk the Michigan taxpayers out of millions. They then connected the 'hypothetical' situation described by Siefullah to the real world Hanger 42 project. Give the Grand Rapids Press credit for doing the real work on this story, fighting through government obstruction and attempts by Democrats at every turn to keep the corruption and fraud that is running rampant in their Film Office secret.

This scandal raises important questions. The Michigan Film Office is Democrat Governor Jennifer Granholm's pet project, one that she brags about often, and yet this scandal raises questions and concerns about how thoroughly corrupt it is. She continually plows taxpayer money into this project, and yet her top example of success for this program (Hanger 42) has proven to be a corrupt sham. Next, at what point in this sham did someone cry foul- who knew what when at the Michigan Film Office about Hanger 42? Perhaps the Attorney General should start asking some questions. Is this the kind of public-private corporate welfare project that Democrats promote, rife with corruption of public officials? Last, is the corruption limited to just the local (state) Representative? Or is this something that many officials in the Democratic party are caught up in?

Stay tuned for further updates, and please feel free to link to this story- perhaps if this story gets big enough the Michigan Film Office and the millions that it is giving out to politically-connected individuals under great secrecy can be brought to light and analyzed and cleaned up.

UPDATE: Here is a video of the story:


UPDATE II: Looks like the Attorney General is getting into this situation- according to this story, Mike Cox (the AG for Michigan, and GOP candidate for Governor) is looking into the Hanger 42 scheme.

NOTE to NEW READERS: New readers, please feel free to also check out some of my recent good posts like Obama is a Caudillo, The Inside Deal: Obama's Economic Program, Employment-Population Ratio Drops to 58.5%, Earth Day: Is it just one big Communist Plot?, Gifted Programs in Schools Training Future Liberals, or Obama On Inner and Outer Circles of Leadership. Also feel free to link to blog-curhatanku.blogspot.com on your blog, and bookmark conservativeteacher.blogspot.com so you can become a regular reader of the battles of a conservative teacher's attempt to advance the principles of liberty and freedom.

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Let’s Make a Movie

G. Pascal Zachary writes about the Ghanaian film industry:

These populist films, while didactic and predictable, at least present an alternative to elite allegiance to the visual arts of former colonialists. In the quarter-century following Ghana’s independence from British rule in 1957, government subsidized filmmakers through a state agency modeled after the British Broadcasting Corporation. State financing led to the production of such minor classics as Love Brewed in the African Pot (1981) by director Kwaw Ansah.
In Francophone Africa, subsidies to filmmakers from the French government spawned a generation of well-trained and high-minded directors, including Ousmane Sembene (Senegal), Souleymane Cissé (Mali) and Idrissa Ouedraogo (Burkina Faso). These and other French-speaking directors made movies that were acclaimed by discerning critics in Europe and the United States, but rarely screened at home. The French justified African movie subsidies as part of a defense of the French language globally and the influence of France with its former African colonies, but African directors gradually began to mourn their alienation from their roots.

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We need an African Common Agricultural Policy

Aboyeji E Iyinoluwa writes in Project Diaspora:

...when one looks closely at the CAP, the objectives are very Euro-centric - and rightly so. The entire point of the subsidies are to enable Europe be self sufficient in the production of its food. For food import loving Africans, this might seem like a strange idea, but in a world of genetic modification, bio terrorism and Monsanto, food is becoming a national security issue and there are several good reason for keeping its production domestic. In fact, a lot of the developed countries we aspire to (including the United States) have subsidies in the spirit and style of the CAP. In a perfect world, much of Africa’s chronic food shortage problems could be solved by adopting a CAP style arrangement for Agricultural production. There is no sense is trying to open a European market for African agricultural products when even with huge volumes of food imports, we can barely satiate the starving people on our own continent.
More here
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Obama Lacks Mandate on Health Care; Description of Tyrant Fits Him Better

In politics, a mandate is the authority granted by a constituency to act as its representative. The concept of a government having a legitimate mandate to govern via the fair winning of a democratic election is a central idea of democracy. New governments who attempt to introduce policies that they did not make public during an election campaign are said to not have a legitimate mandate to implement such policies.

Barack Obama does not have a legitimate mandate to pass health care reform. After announcing this policy initiative, the polling data has revealed that America does not want it. The townhalls that were held to discuss his health care reform proposals turned into angry mobs. In almost every election held since Obama announced his desire to reform health care, his supporters have been shockingly destroyed. Tea parties are held in every district in every state in the nation, each month or week. President Obama does not have the just authority to pass health care reform, and because of this, he should not.

And yet, in spite of this evidence, President Barack Obama is upping the ante on health care. On the eve of sitting down with Republicans to discuss health care and how bipartisan compromises can be reached through discussion and deliberation, he dropped his new health care proposal on the nation, and it is even worse than anything that has come before it. Although it keeps with this administration's policy of not being transparent and having few details, what has been released by Obama is an even larger, more expensive, more insulting version of the Senate version that never was passed before.

More spending, more subsidies, and more taxes. That's not what the American people elected Obama for. Go back and watch his campaign commercials. Read the interviews from people who voted for Obama. Watch the debates again. Obama dodged and ducked and muddled, but people thought he was clear enough when he promised to cut spending, cut subsidies, cut corruption, cut earmarks, cut taxes, engage in bipartisanship, and be transparent with policy creation. Instead though, he has doubled down on everything bad and wrong about American politics- whatever voters didn't like about Bush, Obama has doubled down, and doubled down again, and when told by the American people to stop, he has doubled down again.

The central idea of a democracy and the basis of legitimacy to rule in a democracy is having politicians that listen to the voters and do what they want. But Obama does not like democracy, perhaps because he was not raised in a nation that values it, and Obama is losing his legitimacy to rule. Probably a better word for Obama is tyrannus, meaning illegitimate ruler- Obama increasingly displays the habits and methods of a harsh and cruel ruler who places his or her own interests ahead of those of the American people.

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Aid is Not the Answer: CK Prahalad

CK Prahalad comments that China and India "...represent 900 million people in poverty, a larger number than the entire population of Africa. There are about 600 million in Africa who live on less than $3 per day. Why, then, do China and India evoke fear and anger, while Africa elicits pity and guilt?...Despite the magnitude of their respective poverty problems, China and India may have a chance of meeting the Millennium Development Goals established by U.N. Their economies are following the lead of other countries that have raised their populations into a middle-class economic base. For example, between 1975 and 2004, GDP per capita in South Korea increased fourfold. Over the same period, Malaysian incomes rose threefold.
On the other hand, in those decades, per capita incomes in Nigeria declined by a tenth. Why? During the period 1955-2004, the West and multilateral institutions invested more than $1 trillion in aid and subsidies in emerging economies. But poverty persists. It would seem, therefore, that we need to challenge the role of aid and subsidies in promoting sustainable economic development. If poverty cannot be eradicated with humanitarian handouts alone, what is the alternative?...The G-8, led by Tony Blair and supported by Jeffery Sachs and Bono, believe that debt relief and a doubling of aid from rich countries to poor, especially in Africa, is the way to go. A less popular alternative focuses on the involvement of the private sector in poverty alleviation through the development of market-based ecosystems.
Irrespective of which route we take, we need to build an infrastructure to deal with poverty. There is an implicit aid overhead. According to Prof. Sachs, out of every dollar of aid given to Africa, an estimated 16% went to consultants from donor countries, 26% went into emergency aid and relief operations, and 14% went into debt servicing. How much of the remaining 40% escaped corrupt officials to benefit the intended recipients is not known..."
Via NextBillion

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Executives as Investors-in-Chiefs: A Bad Idea?

The President of the United States fills a lot of important roles in our political system- Commander-in-Chief, Chief Executive, Chief Legislator, Chief Jurist, Chief of State, Chief Diplomat, Head of Political Party, Popular Leader, etc- and to the list of these roles we now apparently must add 'Investor-in-Chief.'

Head of executive branches, whether at the state level as Governors or at the national level with our President, increasingly believe that it is part of their job description to take the money that taxpayers send to them to perform important government functions and instead gamble that money away on risky investments- the more risky and uncertain the investment, the more it seems that these executives are likely to dump precious taxpayer money into them.

Here in Michigan, we had a Governor that won a second term of office believing that she was a good Governor because she dumped taxpayer money into 'green energy' and 'cool cities' and the movie industry; upon further review and looked at with a true eye for costs and investment gains, these investments all turned out to range from bad to poor to horrible. Taxpayer money was distributed in a corrupt manner based more on political favors and little to no lasting gains came from these investments, certainly not enough to justify calling these schemes 'investment' in the private marketplace.

At the national level, Barack Obama believes that one of his major roles as President is to direct investments for the future, in spite of his lack of experience, training, or record of success in investing. No one would ever hire him to direct their personal investments, and yet as President he is doing just this with our public money at a time when public money is in short supply and needed ever more vitally. And the process that these investments are awarded are corrupt, filled with political considerations and backroom deals that would put any private businessman in prison for their actions.

The Washington Post writes about this role of the President in its article Barack Obama, investor-in-chief. From the article:

Would you buy a used car from Barack Obama? Or would you want him managing your 401(k) investment retirement plan at work? The president, of course, isn’t in that business specifically, but in a larger sense he’s been investing our money, picking the businesses he thinks will fuel economic expansion, new jobs and the technology of the future, and rebuild the nation’s fraying infrastructure.

All it takes is money - ours - he says, and he’s been spending it as fast as he can in a failed attempt to get the economy growing again. The economic policy term for this is “central planning,” wherein the government tries to pick the winners and losers and dumps hundreds of billions of dollars into various business sectors in the belief that it will pay off in the long run.

The government isn’t very good at this business, as we’ve seen in the disastrously ineffective $825 billion spending stimulus plan that President Obama and the Democrats shoved through Congress in 2009. Much of that money went into the budgets of countless federal departments, agencies and other programs that spent it. Still more went to states, counties, cities and towns for infrastructure programs or to keep public workers employed. A lot of the money was given to businesses that Mr. Obama thinks will be good for the environment, though his investment decisions didn’t always work out the way he hoped.

Consider the White House-backed solar energy firm Solyndra Inc., which declared bankruptcy this week after pocketing a $535 million loan guarantee from the U.S. Department of Energy. Critics called the deal a “stimulus black hole.”

When Mr. Obama visited the Solyndra factory in May 2010, he called the company a success story that was “leading the way toward a brighter and more prosperous future.”

He was quite proud of his investment, boasting at the time, “Less than a year ago, we were standing on what was an empty lot,” but now here was this shiny, new factory that “is the result of those loans” backed by his administration.
It was later learned that the White House fast-tracked Solyndra’s loan application, rushing Mr. Obama’s pet project through without a lot of serious checking. Federal investigators said that the administration had bypassed procedures to safeguard the taxpayers’ investment.

Mr. Obama is big on the solar-panel industry and under his policies, the government has dumped a lot of our money into it in the past three years. But it turns out that the U.S. industry has not turned out to be the bonanza that he sold to the country. Prices for solar panels have fallen because of strong competition from China, making the fledgling industry precarious at best without heavy federal subsidies.

Evergreen Solar Inc. filed for bankruptcy last month after being forced to close its plant in Massachusetts that was built with state and local government subsidies.

Senate Energy Committee Chairman Jeff Bingaman, New Mexico Democrat, says the loan guarantee program “has not worked as well as we had hoped.” Sounds like a Wall Street investment banker defending a fat bundle of subprime real estate securities that went bad.

The solar-panel industry is not the only “investment” Mr. Obama has sunk a lot of our money into. While the plants build with his loans make for great campaign photo ops, the costly reality is that government is trying to pick the winners and losers in our economy instead of the private sector.

But Mr. Obama thinks he’s good at this investment business and now he is trying to convince us to buy into to a new federal “infrastructure bank” that will make off-budget grants and loans to rebuild “roads, bridges and ports and broadband lines and smart grids” with $30 billion of our money.

The bank would put “all those [unemployed] construction workers” back to work, he said. And it would provide Mr. Obama with lots of photo ops at jobsites, saying “look what I’ve done for you.”

If this sounds familiar, it was sold to us in the guise of the 2009 job stimulus bill that was supposed to put the construction industry back to work. Some short-term jobs were created but when the building projects were completed, the jobs ended. The construction industry today is in a recession.

Making Mr. Obama the investor-in-chief, deciding how and where the nation’s capital resources should be spent, hasn’t worked and isn’t going to work. Ask Japan, which has gone on a public-works spending binge though its economy has been in a slump for two decades.

Better to shift federal public-works spending decisions to the states, along with the gas tax money for highways, and let them - not remote federal bureaucrats - set their own priorities. Broaden the tax base by eliminating dozens of loopholes, then cut business and individual tax rates, and slash the capital gains tax to unlock needed, job-creating investment capital.

Let the marketplace make the investment decisions that have made America the largest and most successful economy in the world. Mr. Obama has got better things to do with his time, like trying to figure out why his job approval polls have fallen to 39 percent.

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The "Colonialism-Imperialism" Paradigm Is Kaput (2 of 2)

PART II (see part I)

Modern Grievances against the West

External Props of African Despots

Historically, every foreign entity that goes to Africa does so to pursue their own interest, not those of Africans. Witness the scramble for Africa in the 1880s. The Chinese do not go to Africa because they love black people soo much. They go there to pursue their interests. Exactly the same can be said of the Cubans. This competition for influence in Africa became pronounced during the Cold War, when super-power rivalry led to the establishment of client states across Africa. The West supported the likes of Mobutu Sese Seko, Samuel Doe, Hastings Banda, Felix Houphouet-Boigny, etc. etc. The East supported the likes of Mengistu, dos Santos, Mattieu
Kerekou, Sassou Nguesso, Samora Machel, etc. etc. Arab countries also backed their clients in Africa: Sudan, Mauratania, Chad, etc.

Cold War Intrigues and Machinations

Each side in the Cold War provided billions in aid to their clients to protect their security interests in Africa. Angola, Ethiopia, and Mozambique all received substantial amounts of Soviet military hardware. For example, Mengistu Haile-Mariam of Ethiopia received more than $11 billion in military weapons between 1975 and 1990. Angola received at least $2 billion annually
in military assistance from the Soviet Union in the 1980s (The Independent, London, Feb 19, 1992). In 1991, $4 billion of Angola's $8.7 billion foreign debt was owed to the former Soviet Union. On July 1, 1991, President Eduardo dos Santos said: "military debts were not usually honored," implying that Angola would not pay it (The New York Times, July 8, 1991). Soviet aid was stingy.
The economic aid the Council for Mutual Economic Assistance (Comecon) provided to sub-Saharan Africa in 1985 was $300 million. Of this, Ethiopia received by far the most (57.9 percent). Next were Mozambique (13.8 percent), Egypt (6.6 percent), Madagascar (4.2 percent), Angola (2.8 percent), and Tunisia (2.1 percent) (West Africa, Dec 12-28, 1988; p. 2320). Angola and Mozambique benefited more from arms supplies. The $300 million aid was only 5 percent of total Comecon bilateral disbursements and only 3 percent of the total aid flow to sub-Saharan Africa.

Furthermore, the little Soviet economic aid that did flow to Africa had strings rigidly attached. Loans and trade credits supplied could only be spent in the Soviet Union and Comecon countries (100 percent tied aid). In addition, the Soviets supplied the technical personnel and the equipment for project construction. Repayments of loans were often by barter, but to the
decisive advantage of the Soviet Union. For example, in Guinea, Soviet help in building a bauxite plant at Kindia was to be repaid with deliveries of two million tons of bauxite ore a year for 30 years.

Barter arrangements also hurt Soviet clients in Africa in a different way. For example, repayments of loans Nkrumah of Ghana took from the Soviet Union were to be made in kind with exports such as cocoa. But the Soviet Union had little use for Ghana's cocoa. Re-export of cocoa by the Soviet Union helped depress the world market price of cocoa in the mid-1960s.

China, an active player in Africa, sought to win adherents to the Chinese brand of socialism. Zhao Ziyang, China's foreign minister in the early 1960s, reminded African leaders of the presence of Chinese coolies in Africa. China's perception was that Moscow, not Washington, was its principal enemy. Its strategy was therefore to weaken "social imperialism at the expense of monopolistic capitalism" (Snow, 1988). West Africa observed that "in Africa, China increased assistance to old friends such as Tanzania and Zambia. The 2000km Tan-Zam railroad was meant to overshadow the Soviet-built Aswan High Dam in Egypt. China also made friends with old enemies such as Mobutu, helping him during the Shaba uprising in 1978-79; in 1980 they helped him build a naval base at Kinkuzu in southern Zaire to threaten Angola" (Aug 15, 1988; p. 1473).

China's fortunes in Africa quickly turned into mirages, however. At first, China's anticolonial stance was welcomed by African liberation movements. But as independence was gained, China's emphasis on subversion and its intense enmity toward the Soviet Union became less and less appealing or relevant to Africans. In fact, as early as 1963 Julius Nyerere of Tanzania
complained of a new scramble for Africa between the Soviet Union and China. Because their actions were anti-Soviet rather than pro-African, the Chinese themselves did not achieve much by way of influence.

Furthermore, China was no less immune to blunders than the Soviets. Less wisely than the Soviets, China meddled in Burundi ethnic feuds. In 1963 China backed the Tutsi expedition by training a number of Tutsi in guerrilla warfare in China. The subsequent massacres in Burundi earned China much opprobium. China also supported the Biafran secessionists in Nigeria's civil
war (1967 to 1970) simply because Moscow backed the Federal Government of Nigeria. Similarly, in Angola, China supported the FNLA (National Front for the Liberation of Angola) because Moscow was backing the ruling MPLA.

In Mali and Congo-Brazzaville, China made some headway. But a spate of military coups brought to power new rulers distrustful of China. Only in Tanzania did China achieve some diplomatic and ideological success. China agreed to fund and build the 1,200-mile Tan-Zam railway line at a cost of 166 million pounds sterling, free of interest. The railway was both an
engineering and a political achievement. It was completed two years ahead of schedule and was much touted as a model of what foreign aid could do for Africa. But it was one thing to build the railway and quite another to run it efficiently. Maintenance was poor, services degenerated, and the Dar es Salaam terminal became chronically clogged to the point of immobility. Although the Chinese had nothing to do with these shortcomings, their reputation suffered.

Zimbabwe received technical and military aid from North Korea and China. For its part, the West also poured billions into Zaire, Liberia, Kenya, Nigeria, and other African countries.

Each side also sought to undermine African regimes that were hostile to it. Lumumba was assassinated by the CIA operatives and the 1966 coup against Nkrumah was orchestrated by the CIA. In this sphere, the French were the worst, intervening directly to remove African leaders they did not like in Francophone Africa. For the French, independence did not mean a retreat from Africa. France left hundreds of officials in Africa as advisers. Behind the doors of many key ministries in the Ivory Coast and Senegal or Gabon, discreet but powerful French officials kept a close eye on policy. The French also sent teachers to Africa and brought African students and civil servants to France for training. France secured the right to maintain a
heavy military presence in Africa. In 1989, for example, France had a significant number of military advisers in 16 African countries and permanent Forces d'Intervention in seven. Total strength of French troops in Africa exceeded 12,000 in 1990. In France itself, the Forces d'Action Rapide, numbering 47,000, could be mobilized in less than 48 hours for action anywhere in Francophone Africa. These forces played an economic policing role and backed up French diplomacy and paternalism. They supported "approved" Francophile governments such as those of Leopold Senghor of Senegal and Felix Houphouet-Boigny of Cote d'Ivoire.

After 1960 the French intervened on many occasions to prop up unpopular African regimes against internal dissatisfaction and disorders. The most notorious such occasion was in Gabon in 1964, when French troops were used to reinstate President Mba after a coup. Noting that the French did not intervene to save President Youlou in Brazzaville in 1963, critics charged that intervention was predicated on mineral wealth. (Gabon is rich in oil.)

Now, each foreign entity operating in Africa pursues its own interests. It was ONLY the West which propped up hideous dictators in Africa. A foreign prop is a foreign prop is a foreign prop, regardless of its origin. An African leader is supposed to pursue the interests of his PEOPLE. If he doesn t, remove him from power but did we? Instead, we argued ad nauseam that, since the West put Mobutu, for example, in power, it was the responsibility of the West to remove him. This was ridiculous because if Mobutu was serving Western interests, why would the West remove him? And even if the West removed him, who do you think the West would have installed as a replacement? Another Mobutu !

It is clear that we have drawn no historical lessons from our dealing with the West and other foreign blocs. Here s a popular adage: If someone cheats you once, he is the fool but if he cheats you again, you are the fool. If you agree, then why are we talking about the Second Scramble for Africa ? And have we not learned that if you give an African problem to the Americans, Brits, French or the Chinese to solve it, each would solve it to their advantage? Does the mantra, African solutions for African problems, make sense to you?

Again, prop or no prop,

You cannot claim that it was the West which told Mobutu to loot the Zairean treasury. Nor claim that it was the North Koreans who told Mugabe to butcher over 20,000 Ndebele in 1980 (Matabeleland massacre). Neither can you claim that it was the Arabs who ordered Idi Amin to
butcher over 200,000 Ugandans. Nor can you claim that tell me it was the French who ordered Gnassingbe Eyadema to cling to power for 34 years and amass a personal fortune worth $3
billion.

True, the French and indeed the World Bank knew these African despots were stealing money and looked the other way. But who is an African leader accountable to? To the French, the World Bank or his PEOPLE? Prop or no prop, these leaders must be held accountable for their actions.

In fact, these days the charge of foreign meddling in African affairs and the specter of sinister and greedy multinational corporations lurking in the dark, waiting for a chance to pounce and exploit Africa confute reality. Foreign investors have fled Africa as the continent remains unattractive. Is it not African governments who have been drawing up elaborate and fancy
investment codes to ATTRACT them back? And is it not African governments themselves who take their budgets to foreign capitals for approval in order to get foreign aid? So who ALLOWS the meddling in African affairs?

Even then, the West has shown little interest in meddling in African affairs in the past few decades. If anything, the West has been in retreat from Africa! Recall the statement by presidential candidate, George Bush, that Africa was not of strategic importance to the U.S. And was it not the same African leaders who were complaining after the Cold War that Africa was
being marginalized ? So which is which: Is the West meddling in African affairs or the West marginalizing Africa?

In case you did not know, the West is thoroughly fed up with Africa, which it regards as a cry-baby, hopelessly incapable of solving any of its problems and is constantly crying out for help. What do you think the expression donor fatigue means? That is the diplomatic way of saying that the international community is fed up with incessant African appeals and begging. Today, there is famine in Ethiopia, tomorrow, there is a refugee crisis created by war in Liberia, or Somalia. Then there is genocide in Rwanda, starvation among refugees in eastern Congo, Ivory Coast, and on and on. Haba. Africa is now synonymous with war, destruction, famine, refugees, starvation, instability and chaos. Year after year since 1985, one African country after another has imploded, scattering refugees in all directions: Ethiopia (1985), Angola (1986), Mozambique (1987), Sudan (1991), Liberia (1992), Somalia (1993), Rwanda (1994), Zaire (1996), Sierra Leone (1997), Congo DRC (1998), Ethiopia/Eritrea (1998), Angola (1999), Ivory Coast (2000), Togo (2005).

The implosion of these countries had nothing absolutely nothing to do with the slave trade, nothing to do with Western colonialism or imperialism, nothing to do with artificial colonial borders, nothing to do with an unjust international economic system; in short, nothing to do with so-called external factors. They all had to do with one thing: POWER the adamant refusal to relinquish or share political power. If GENERAL Siad Barre of Somalia, GENERAL Juvenal Habryimana of Rwana, GENERAL Pierre Buyoya of Burundi, GENERAL Mobutu Sese Seko of Zaire, GENERAL Samuel Doe of Liberia, GENERAL Joseph Momoh of Sierra Leone, GENERAL Robert Guie of Ivory Coast, GENERAL Gnassingbe Eyadema, etc. etc. had been willing to step down or put in place power-sharing arrangements, each of their countries would have been
saved. Note the frequency of the title, GENERAL.

The rule is this and you can call it Ayittey Law: "The adamant refusal of an African head of state to step down or share political power will ultimately lead to the destruction of his country." If Mubarak of Egypt, Museveni of Uganda, Mugabe of Zimbabwe, Ghaddafi of Libya refuse to leave the political scene or share power, their countries will be destroyed. This is not rocket
science and it has nothing to do with the West. It is a personal or political failure that cannot be blamed on Americans, Chinese or Martians.

Back in 1986, President Museveni of Ugana said that no African leader should be in power for more than 10 years. What happened to him? He has been in power for more than 16 years and still counting. Finally in the late 1990s, African leaders wrote Constitutions in which they inserted the two-term limits. What happened? They are the very same ones who are now using their parliamentary majority and various devious maneuvers to override or repeal the two-term limits in Chad, Guinea, Namibia (Nujoma before he retired), Uganda, and even Nigeria.

Benin, Cape Verde Islands, Sao Tome & Principe, South Africa and Zambia all saved themselves from implosion because their leaders agreed to power-sharing arrangements crafted out of sovereign national conferences. South Africa would have blown up if the whites had not sat down with the blacks in a Convention for a Democratic South Africa (CODESA) to craft a new
political dispensation for the country. Rwanda blew up because the Hutu-dominated government of GENERAL Juvenal Habryimana refused to share power with the Tutsi minority and, instead, decided to exterminate them. "No Tutsis, nobody to share power with" was the macabre and brutal logic. More than 800,000 Tutsis were slaughtered in a orgy of violence and brutal massacre. That, in itself, was an excellent example of "intellectual astigmatism".

We could see with eagle-eyed clarity all the repugnant and inhumane brutalities of the white apartheid system in South Africa but we were hopeless blind to the equally heinous tribal apartheid regime in Rwanda. If the racist apartheid regime in South Africa had butchered just 2,000 blacks, even Idi Amin, who himself slaughtered more than 200,000 Ugandans, would
have arisen from his grave to attack South Africa with 3 dilapidated helicopters! But we said nothing when 800,000 Tutsis were slaughtered. Instead, we blamed the WEST for NOT intervening to stop the genocide. In fact, at its July 2000 Summit in Lome, Togo, the defunct OAU demanded a Marshall plan style compensation package for Rwanda. The demand for
compensation was part of the OAU inquiry into the 1994 Rwandan genocide, which blamed Western powers for failing to intervene to stop the mass slaughter. Naturally.

The OAU inquiry singled out France and the United States for particular blame for failing to prevent the genocide in addition to the United Nations Security Council as a whole. France was culpable because, having high level contact within Rwanda s Hutu-led government, the OAU report argued, could have exerted pressure to prevent the death of 800,000 people. The OAU
enquiry also blamed the US for failing to use its influence in the Security Council to authorize a military intervention to prevent the killing. The report argued that the West failed Africa despite the availability of copious evidence that the mass killing had been about to begin. In
conclusion, the report noted, a simple apology as already made by the United Nations was not enough and called for compensation, alluding to the $13 billion Marshall Aid plan the U.S. launched for the reconstruction of Europe after World War II. And what did these self-righteous leaders do to prevent the killings going on right under their very noses? And how can these
leaders complain about foreign meddling in African affairs and at the same time blame the West for NOT INTERVENING in an African problem to stop a massacre?

These days appeals by African leaders fall on deaf ears. OECD aid to Africa fell by 22 percent between 1990 and 1996, decreasing by 18 percent to sub-Saharan countries between 1994 and 1996 alone. (DeYoung, 2000a; p.A1). Even humanitarian aid to Africa has been shrinking. Contributors to United Nations aid and development programs have provided slightly more than half of the $800 million requested in 1999 for African countries suffering from "complex emergencies" -- the term is applied when war and failed institutions, often combined with a natural disaster, leave vast numbers of people homeless and starving. Specific programs for some particularly problematic areas, such as the Great Lakes region of Central Africa
including the two Congos, Rwanda and Burundi, have fared even less well (DeYoung, 2000b; p.A1).

In Sept 1999, the U.N.'s World Food Program announced it would curtail its feeding program for nearly 2 million refugees in Sierra Leone, Liberia and Guinea after receiving less than 20 percent of requested funding. An emergency appeal during the summer to feed and shelter at least 600,000 Angolans who had been displaced in that country's long-standing civil war
brought minimal initial response and predictions of mass starvation. In Africa's Great Lakes region of Congo, Burundi and Rwanda, where wars have produced nearly 4 million refugees, the United Nations estimated it would need $278 million to take care of them. By Oct 1999, only 45 percent of that amount had been donated. Nearly 80 percent of the United Nations humanitarian appeals in 2004 were to address African problems, but the response was disappointing as to be non-existent. "I remember sitting in this very room last summer (2004) asking for five helicopters to save thousands of lives in Darfur (Sudan). In the end we had to hire helicopters commercially as no Member States were willing to provide them," Under-Secretary-General Jan Egeland, head of the UN Office for the Coordination of Humanitarian Affairs (OCHA), the chief of the UN humanitarian office told the Security Council meeting on humanitarian challenges in Africa in January 2005 (http://www.un.org/apps/news/story.asp?). Even Irish rock star, Bob Geldof, who organized Band Aid and Live Aid to provide famine relief to starving victims in Ethiopia in 1985 is now fed up with Africa. He said this on Jan 31, 2005, of his work in Africa: "I'd dearly love not to have to go there the day after tomorrow. More often than not, it bores me profoundly - the pace of change is far too slow, and Africans excuse their own complicity in exactly the same way as our politicians (http://news.bbc.co.uk/1/hi/entertainment/music/4222373.stm).

Private organizations are also having difficulty raising funds for African relief operations. According to Mario Ochoa, executive vice president of the Maryland-based Adventist Development and Relief Agency (ADRA), which operates relief projects out of its own donations and under contract with donor governments, If I were to go now and make an emergency appeal for, say, Rwanda, for $500,000 for food, I'd probably get about seventy or eighty
thousand" in contributions (The Washington Post, Nov 26, 1999; p.A1).

True, every now and then, a major effort is launched in the West to help Africa. Africa s plight follows a ten-year attention deficit cycle: 1985 (Live Aid to save famine victims in Ethiopia), 1996 (a Special U.N. Session to boost aid to Africa to $25 billion), and now (2005). It is so humiliating to have the salvation of Africa tied to the success of rock concerts. And 20
years later, Ethiopia still can t feed itself and is appealing for food aid. Who do you blame: The white kids who did not give enough charity at the rock concerts or the stupid policies of Ethiopia s leaders?

Unjust International Economic System

Back in the 1950s and 1960s, this argument had much validity: The international economic system, dominated by western multi-national corporations, was rigged in favor of the rich countries. Prices of cash crops were fixed at artificially low levels; markets were cornered by giant western corporations, paying low wages and raking huge profits. While prices Africa received for its exports remained low, the prices Africa paid for imported manufactures soared astronomically (declining terms of trade). But today, with the onset of globalization, this argument carries little validity.

First, there is much competition on the international market. Asian corporations are now some of the big players. Second, African governments have done next to nothing to add value to their exports. Ghana still exports much of its cocoa in raw beans form. Third, every market has its ups and downs. We complain when the markets are down but conspicuously silent when
the market booms. Did we complain about an unjust international economic system when copper prices reached record levels in the late 1970s? When gold prices soared in the 1980s, cocoa prices in the 1990s? May I mention oil prices? By the way, what did we do with the windfall we reaped from the high prices? We squandered it!

Fourth, Africa s share of world trade fell from more than 3 percent in the 1950s to less than 2 percent in the mid1990s and to only 1.2 percent, excluding South Africa (The World Bank, Can Africa Claim the 21st Century;p.20). This erosion of Africa s world trade share in current prices between 1970 and 1993 represents a staggering annual income loss of $68 billion. This loss is not due to an unjust international economic system. Fact is, Africa has not been producing and you can t trade on the international market if you have nothing to sell. The physical volume of exports has been declining and therefore it is not a question of Africa not being able to earn enough because of low prices. Burundi s coffee exports, Ivory Coast's cocoa exports, and Sierra Leone s diamond exports have been devastated not because of low world market prices but by senseless civil wars. Even with food, we don t produce enough to feed ourselves and spend $19 billion a year on food imports. Nigeria spends $3 billion a year on food imports and has now brought white Zimbabwean farmers to teach it how to become self-sufficient in food production. What a disgrace!

Much of the decline in agricultural production in Africa is due to price controls, naked exploitation of Africa s peasant farmers, and senseless civil wars that have devastated the countryside and uprooted millions of people. Refugee camps are full of women and children, who produce the bulk of Africa s foodstuffs. State marketing boards fixed at ridiculously low
prices to milk the peasant farmers and they REBELLED. In Senegal, peanut (groundnut) farmers were receiving less than 20 percent of the world market price for their produce; in Ghana, cocoa farmers were receiving less than 30 percent for their produce in the 1980s. Those who complain about the Western conspiracy to fix prices for African exports at artificially low levels obviously do not see the ridiculously low levels their own State Marketing
Boards fix prices for peasant farmers.

Unfair Trade Practices, Trade Barriers and Subsidies

To be sure, unfair trade practices -- trade barriers and agricultural subsidies -- are legitimate issues of concern for the Third World. It is hypocritical for the West to preach free trade to the developing countries and yet put barriers in its place. But there is hypocrisy on both sides.
According to Columbia University economist, Jagdish Bhagwati, there is greater tariff protection on manufacturers in the poor countries . . . and autarkic trade barriers make domestic markets more lucrative than exports, leading therefore to an incentive bias against exports. So even when the rich country markets are opened further, one s own trade barriers can prevent the penetration of these markets (The Wall Street Journal, Jan 18, 2005; p.A16).

More importantly, the rich countries protect themselves against unfair trade practices, so why shouldn t African countries? A case in point is U.S. s anti-dumping law. Known as the Byrd Amendment for its chief author, Senator Robert Byrd (D-W. Virginia), the law passed by Congress in 2001 provides that when foreign manufacturers are found to be dumping goods in the U.S. market that is, selling at unfairly low prices any anti-dumping duties that are imposed can be handed over to the U.S. companies that brought the dumping case, rather than to the Treasury. It has benefited U.S. firms in industries including steel and pasta, with one of the largest beneficiaries being Timken Co., an Ohio maker of bearings, which collected about $40
million in 2004 (The Washington Post, April 1, 2005; p.A4). So, what have African governments done to protect their countries against dumping? NOTHING!

Even then, trade barriers are peripheral to the core issue of Africa's under development. Africa s exports consist mainly of cash crops (cocoa, cotton, coffee, bananas, sisal, etc.) and minerals (gold, diamonds, oil, titanium, cobalt, copper, etc.). Trade barriers and agricultural subsidies in the West affect only a few African exports, such as cotton (Burkina Faso, Mali, Sudan), peanuts or groundnuts (Gambia, Senegal, Sudan), sugar (Mauritius, Mozambique, South Africa), tobacco (Malawi, Zimbabwe), and beef (from Botswana, Namibia). Only a few African countries such as Ivory Coast, Mauritius, and South Africa export manufactured goods, which can encounter
trade barriers in the West.

It is not Western agricultural subsidies, however, that have hurt African food agriculture. Food production per capita has been declining and Africa's food import amounts to some $19 billion annually. The recent civil war in Ivory Coast, for example, cut the country's cocoa exports by half and disrupted agricultural exports of neighboring countries that pass through Ivory Coast. In Burundi, coffee production has dropped by more than 50 percent because of civil war/strife that has engulfed that small country of 8 million people since 1993. In Malawi, crime has risen so sharply that some farmers have refused to grow crops. And while the U.S. maintains import
quotas against Zimbabwe's tobacco exports, the industry has virtually been destroyed by President Robert Mugabe's violent seizures of white commercial
farmland to remedy "colonial injustices .

Wailing over agricultural subsidies in rich countries amounts to shedding crocodile tears since it gives the false impression that African governments care much about agriculture. The erosion of Africa s share of world trade was caused not so much by trade barriers but rather a host of internal factors. Among them are the neglect of agriculture occasioned by the over-emphasis on industrialization, raging civil wars, crumbling infrastructure, and misguided socialist policies that exploited Africa's farmers through a system of marketing boards and price controls. For example, trade barriers do not block exports of oil, diamonds, gold, col-tan, and other minerals from Africa. Yet, paradoxically, countries that produce them -- Angola, Congo, Equatorial Guinea, Gabon, Nigeria, Sudan, among others -- have been wracked by war, poverty and social destitution. In fact, Africa's diamonds have fueled such barbarous civil wars in Angola, Congo, and Sierra Leone that human rights activists in the West have called for a boycott of Africa's "conflict diamonds.

A key note speech by the new African Union (AU) secretary-general, Amara Essy, to mark the New Year on Jan 3, 2002 in Addis Ababa, Ethiopia, did not provide Africans with hope or assurance. He "accused the international community of failing the continent; their refusal to alleviate Africa's huge
debt burden continues to compromise its development" (IRIN, Jan 03, 2002). Same old drivel. Rather, it is African leaders who have failed the continent. The externalist paradigm by which African leaders blame everyone else but themselves for Africa s woes, is now KAPUT. The African people no longer buy it. Why then does this paradigm still have avid adherents? Four
reasons.

First, it is naturally the credo of most African leaders since it exculpates them from any blame for the current mess. Some evil external force did it! But the people don t buy it. Witness the huge credibility gap between the rulers and the ruled. Second, advocacy or veneration of the externalist paradigm constitutes a passport to career advancement. Those African scholars and intellectuals who rail against the World Bank, IMF and other external enemies are often rewarded with ministerial posts and government appointments. Rail against British colonialists and President Robert Mugabe will reward you with a government post. Such was the case of Jonathan Moyo.

Outside Africa are the third and fourth groups. Black Americans, drawing upon their own horrific experience, unfortunately have a radically different perception and understanding of Africa s woes. Most black Americans do not distinguish between African leaders and the African people and see Africa as a victim of Western neo-colonialism and imperialism just as they see
themselves as victims of racism, white supremacy and the lingering effects of slavery. Given their history and experience, black Americans tend to see only white devils because their oppressors and exploiters in the past were all white. Black Americans have never lived under brutal tyrants such as Idi Amin, Samuel Doe or Sani Abacha and therefore cannot relate to black
tyranny. This partly explains why black American leaders led the campaign against the heinous apartheid system in South Africa but were conspicuously absent in the campaign against the equally heinous de facto apartheid regimes in Rwanda, Burundi, Uganda and elsewhere in Africa. It also explains the tendency of black American leaders to embrace those African leaders that spit venomous anti-West vitriol: Minister Louis Farrakhan and Moammar Ghaddafi of Libya. Thus, black American perspective on Africa often clashes with that of the people. In fact, when President Clinton appointed Rev. Jesse Jackson as special envoy to Nigeria in 1994 activists threatened to stone him if he ever stepped foot in Nigeria. Five years later, Sierra Leonians were outraged when Rev. Jackson compared Foday Sankoh to Nelson Mandela. Sankoh was the late leader of RUF (Revolutionary United Front), the murderous gang of savage rebels whose signature trademark was to chop off the limbs of those even children and breasts of women who stood in their way.

The final group of strict adherents to the externalist doctrine consists of some African scholars and intellectuals in the diaspora. They are mostly in academia and have made heavy emotional, personal and professional investment in the externalist paradigm. Their bible continues to be How Europe Under-developed Africa. Their careers have been advanced, promotions secured and books written, propagating the externalist doctrine. It would exceedingly difficult for them to admit that their books and scholarly works are no longer relevant to the immediate needs of Africa. Political correctness pervasive in academia and black American influence also make
it difficult and embarrassing for these African scholars to admit that African leaders have failed their people. They erroneously think such an admission would amount to washing Africa s dirty linen in public and provide ammunition to racists. But who is fooling who?

The African people know that the leadership and/or government are the primary obstacles that stand in the way of poverty reduction in Africa. Said a tribal chief in a rural farming community in Lesotho: "We have two problems: rats and the government" (International Health and Development, March/April 1989; p. 30). Amina Ramadou, a peasant housewife, came up with a
creative way of solving Zaire s economic crisis: "We send three sacks of angry bees to the governor and the president. And some ants which bite. Maybe they eat the government and solve our problems" (The Wall Street Journal, Sept 26, 1991; p. A14). When the presidents of Algeria, Nigeria, Senegal and South Africa traveled to Kananaski, Alberta (Canada) on June 26,
2002, to present NEPAD to the G-8 Summit for funding by the rich nations, Mercy Muigai, an unemployed Kenyan was irate: All these people [African leaders and elites] do is talk, talk, talk. Then if they do get any money from the wazungu [white men], they just steal it for themselves. And what about us? We have no food. We have no schools. We have no future. We are just left to die (The Washington Times, June 28, 2002; p.A17).

In July, African leaders will be heading to another G-8 Summit in Gleneagles, Scotland, to beg, beg, and beg for more foreign aid. I will be going there myself to represent Mercy Muigai. Let the other African scholars continue to read How Europe Under-developed Africa by Walter Rodney.

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Government Aid vs Prosperity

Not that I'm telling you anything you don't know, but I always love it when statistics generally bear out my crazy theories that the way to create a prosperous free economy is to have low government regulation and low taxes. For my unit on state and local government, I found this article on Variations in Government Aid Across the Nation that was put together by the New York Times. This report looks at welfare, unemployment, housing assistance, food stamps, health insurance for poor adults, and health insurance for poor children, and measures them from state to state.

The top states in terms of providing generous benefits to their citizens- in other words, those that take money from taxpayers and re-distribute that wealth to those who did not earn it are (in descending order): Vermont, Maine, Massachusetts, DC, Pennsylvania, West Virginia, Iowa, and Michigan.

Out of curiosity, I decided to pull up some information on GDP growth, and provided by the Department of Commerce. The results are interesting. Here are the GDP growth rates for those states, with numbers from 2006 and 2007: Vermont (2.8, 1.5) , Maine (1.9, 1.3), Massachusetts (2.9, 2.5), DC (4.1, 4.3), Pennsylvania (1.7, 1.6), West Virginia (0.6, 0.1), Iowa (2.6, 1.7), and Michigan (-0.5, -1.2).

Those states that let citizens keep their wealth and freely make their own decisions are: Colorado, Texas, Utah, Florida, Nevada, Arizona, Oklahoma, and Virginia.

Here are their GDP growth rates (2006, 2007): Colorado (4.3, 2.0), Texas (4.3, 4.1), Utah (7.2, 5.3), Florida (4.2, 0.0), Nevada (4.1, 0.6), Arizona (6.8, 1.8), Oklahoma (6.7, 4.0), and Virginia (3.2, 1.9).

As you can see, the results are pretty conclusive. States that redistribute wealth from the rich to the poor, divert money from taxpayers to nonworkers, subsidize poor quality housing, give people food, and provide government-paid healthcare are less prosperous, less successful, and less free.

Those states that follow these unsuccessful public polices have GDP growth rates significantly and consistently lower, and over several generations destroy the wealth and productivity of their citizens. If our whole nation were to adopt those same policies, our children and children's children- our posterity- would grow up less free, less happy, and less prosperous than we are today.

The conclusion, as demonstrated with this limited amount of research, is clear- our public policies should emphasize self-sufficiency, less public welfare, and lower unemployment benefits, and should keep the state out of building structures for people just because of their income status, and should teach a man to fish instead of giving him fish, and should not provide as a right of birth state-supported healthcare.

UPDATE: Today I saw a report from the Mercatus Center at Georgetown called Freedom in the 50 States: An Index of Personal and Economic Freedom. Earlier I pointed out that many of the states that provided the most social welfare services to its citizens also are less prosperous. Looking over this report, I notice that those states that provide healthcare to poor, housing subsidies, and food stamps also are less free. I guessed this fact (see above), but it's nice that my guess is now backed up in numbers that show that.

According to the rankings in the report (1 is most free, 50 is least), the least free states- the states with the most tyrrany and oppression by government- compare favorably with my list of states that had the highest social welfare.

Here are the states that provide the most social services and their rankings on freedom- Vermont (40), Maine (39), Massachusetts (43), DC (NR), Pennsylvania (20), West Virginia (33), Iowa (16), and Michigan (14). Here are the states that provide the least social services and their rankings on freedom- Colorado (2), Texas (5), Utah (11), Florida (22), Nevada (24), Arizona (8), Oklahoma (18), and Virginia (9).

There you go- states that encourage conservative values are more prosperous and more free. The data doesn't lie.

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Professor Epstein: Obama is Incoherent and Frightening

Here is what Richard A. Epstein, Senior Fellow at the Hoover Institution, Professor of Law at New York University Law School, and senior lecturer at the University of Chicago, had to say regarding the major speech that President Barack Obama (one-term Democrat) gave at Osawatomie, Kansas:

The painful ignorance that is revealed in these remarks augurs ill for the long-term recovery of America. With the president firmly determined to set himself against the tides of progress, innovation will be harder to come by. The levels of unemployment will continue to be high as the president works overtime to impose additional restrictions on the labor markets and more taxes at the top of the income distribution—both backhanded ways to reward innovation and growth.

The problem, therefore, with the president’s speech is not that it is demagogic in tone. The problem is that it is intellectually incoherent. As a matter of high principle, the president announces his fealty to markets. As a matter of practical politics, he denigrates and undermines them at every step. It is a frightening prospect to have a president who lives in a time warp that lets him believe that the failed policies of 1935 can lead this nation back from the brink. His chosen constituency, the middle class, should tremble at the prospect that his agenda might well set the course for the United States for the next four years.
In Professor Epstein's analysis of President Obama's speech, he echo's some of the comments that I have been making on liberal blogs like Balloon Juice and others- that in spite of his rhetoric and because of his economic incoherence and illiteracy, workers, school teachers, union employees, blue collar employees, the middle class, supporters of Occupy Wall Street, and related groups are going to suffer the most from President Obama's policies.

As Epstein wrote in his article Populist-in-Chief:
It is a good thing when plants can achieve the same output with less labor. Do we really want an America in which thousands of people work in dangerous occupations to turn molten lava into steel bars? Far better it is that fewer workers are doing those jobs. The jobs lost in that industry will be in part replaced by newer jobs created in the firms that build the equipment that make it possible to run steel mills at a lower cost and far lower risk of personal injury. The former workers can seek jobs in newer industries that will only expand by competing for labor.

And what about those ATM machines? Does the president really want people to have to queue up in banks to make deposits or withdraw cash in order to make a boom market for human tellers? Perhaps we should return to the days before automation, when phone calls were all connected by human operators. And why blast the Internet, which has created far more useful jobs than it has ever destroyed?
You see, if President Obama had his way, we would return to the Great Depression, when people were dependent on government for goods and services because government was in the business of destroying productive business around the world. If President Obama had his way, he would increase taxes and regulations on businesses while giving out subsidies and tax breaks to favored businesses, favoring those who hire lobbyists and special interest groups who redirect wealth over those who create wealth and make products or sell goods and services. If President Barack Obama had his way- a Congress of Democrats that went along with his ideas and ideals- America would be dragged back to the early 1900's, when we had a low standards of living and shorter life spans, and Obama would happily fill up dangerous and inefficient steal mills with 'workers', he would sign praises to the joy of labor while factory workers worked for low wages (compared to today) in dangerous industries, and the working class would have few goods (like cheap cars coming in from the Far East, cheap electronics built in backward nations around the world, and labor-saving devices everywhere built everywhere) just so that he could burnish his protectionist credentials.

When government gets in the business of redirecting wealth and picking and choosing the winners and losers in society, the only people who win and get wealthy are government officials- this lesson has been demonstrated over and over around the world many times over. And yet, that is exactly what Barack Obama and his Democratic Party are proposing to do- increase the power of the government to control wealth, liberty, and property in our society, and that somehow through this 'workers' and the '99%' will get more wealthy and happier. The logic is not explained, the mechanisms by which wealth is created are not explained- rather, the logic is the same logic that is found in every despotic tyranny throughout history- people have earned things that others want, and the government will get those things by playing one side off the other. Obama's magic act of wealth creation is the same sort of tyranny that the world has seen many times over- and has fallen for many times over as well.

Our nation has not only learned nothing from the Great Depression, we have learned the wrong lessons as well (see my post Lessons from Economic Recessions- Introduction and Great Depression), and are going about repeating the same mistakes that turned a recession in 1930 into a Great Depression that lasted to the 1950's (and included in it the collapse of the world into a deadly World War!). We must not allow this guy to enact those same policies- I don't care who does what with the GOP, and it doesn't matter who they are, anyone is an upgrade over this incoherent ideologue whose mind is so filled with mush and mindless platitudes and liberal bumper slogans that he is now unable to effectively design any policies that have a slightly positive effect on anyone.

President Obama, any Democrat who supports him, and any Republican who agrees with his policies needs to join Herbert Hoover on the unemployment line (or better yet, get a job somewhere in the private economy building or making or doing something useful!).

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High Economic Freedom = Where We Want to Be

For years, the United States has been a leader in the world in economic freedom. Economic freedom is defined as having property rights protected by impartial rule of law, free trade, a sound currency, and a small limited government relative to the size of the economy. My blog supports economic freedom, and the political party that I support also pushes for policies that make economic freedom a reality- no bailouts, no government take-overs, bond holder rights that are respected, low and fair taxes, consistent regulations and rules, a restrained bureaucracy, free trade agreements with Columbia or other nations, no inflating the currency through QE or other Fed schemes, a return to the gold standard, and a limited and small government that does take valuable resources away from the private sector.

Many people oppose these policies- they seek to make the United States less free. The problem with this is that those countries that are less free also are less prosperous. By pushing for stimulus bills, czars, subsidies for green energy, deficit spending, higher taxes, inflating of the currency, or other liberal Democrat policies, our nation becomes less economically free, and the result is higher unemployment, lower income, less happiness, lower life expectancy, less clean environment, and more corruption.

I know, I know- you care about the poor people, you see Bush as a bogeyman, you hate the war in Iraq, you are passionate about the environment- it does not matter why you vote Democrat and why you are a liberal, the result is that you support policies that make our nation less economically free, and thus a lesser nation in so many ways.

This video will help illustrate it for you and you'll see what nations are economically free and which ones aren't- and hopefully this will help you to understand what sort of policies to support in our society and which political party to vote for and which ones not to.

H/T to Orlin for passing this video on to me. Thanks!

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Big Energy Corporation Guarantees $10 Million to Democratic Party; Kickbacks and Corruption to Follow?

Duke Energy Corporation is going to be guaranteeing a $10 million line of credit from Fifth Third Bank to the Democratic National Convention, which is apparently the first time such an arrangement has been used by any Democratic convention organizers and which has never been done ever by Republican organizers.

By extending a line of credit, Duke is either currying favor or looking for a particular kickback, both of which are even more evidence that the America of the modern-day Democratic Party looks a lot like despotic governments of the past or (Detroit of the recent past) in that it is pay-to-play and a gangster economy out there, and you get benefits and advantages not by producing a better product more cheaply and efficiently, but by bribing Democratic officials. It is either one of these explanations, or a third possibility, which is that rich Big Energy executives are using a company that they don't own as collateral against loans from a Big Bank to support a political party that their company does not necessarily support. That would be wrong too. There is no other explanation that I can think of.

This makes a mockery of the current attack on Supreme Court Justices Clarence Thomas and Antonin Scalia for their votes on Citizens United v Federal Election Commission. Democrats (like popular leftwing blog The Blue Voice) whined and cried endlessly about how conservatives and Republicans support businesses being more involved in politics and how that is just so wrong and that they hate having businesses dirty money in politics- and yet, demonstrating their utter hypocrisy, they then turn around and welcome far more business money and involvement to run their very convention.

I wonder- is Obama going to bemoan corporate donations reading from a speech on a teleprompter backed by $10 million line of credit from Fifth Third Bank backed by Duke Energy Corporation?

According to experts, Duke's involvement can only help Duke in seeking energy subsidies from the Obama administration, although if the Republicans win the White House, it is all but guaranteed that such shady inside corrupt deals will not be rewarded with government contracts. Democrats though are hoping that Obama's ability to... to... to do something or other will win him a second term of office so that he can continue to spend my grand kids wealth so that the new normal of our economy continues and the world becomes a little bit more of a dangerous place.

This sort of behavior should not be tolerated in a free society, and by that I don't mean that Duke Energy Corporation did something wrong. They should be able to dump as much money as they want on any political party they want- it's a free society. But it shouldn't matter- factions should be checking factions, fighting over the abilities of a weak and limited government that has no powers to award contracts or give out favors in a free and prosperous society. Democrats and liberals have created a tyrannical government, the kind feared by our founding fathers, the kind that can be bought off, but more so, once bought off can use its connections with government to corrupt and subvert free peoples and their labor for their gain. Democrats and liberals need to be thrown out office, at every level, consistently for several decades, as Tea Party battles Republican in a battle to restore life, liberty, and protection of property to the free and prosperous people of America.

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Banana Republic Capitalism

Although I have written several times about what is going on with the auto companies (Government Motors, Obama the CEO, on SNL, Obama Forces Private Businessman Out of Job), I'm not a lawyer, and so I don't have the correct grasp on language that some real lawyers do. I mean, I know intuitively that what is going on is not right (What does a Political Economy look like? and Michigan Businesses Battle Government Regulations ...), but I can't describe what is going on in the US as well as the guys over at Power Line can. This is a great post (read it here):

The Chrysler reorganization is shaping up as another milestone in the decline of the rule of law under Barack Obama. We've said for quite a while that bankruptcy is the only viable option for Chrysler and General Motors, not--as Obama claims--because they don't know how to make the right kinds of vehicles, but because their unsustainable union contracts make it impossible for them to be profitable. That reality has now been turned on its head, as the administration has tried to bully Chrysler's secured creditors into going away, while the United Auto Workers Union, solely on the basis of political clout, would be paid at an implied rate of 50 percent and would emerge owning 55 percent of the company, with the government also holding a stake.

This is banana republic capitalism at its worst. Political influence, rather than the law, dictates the rights of the parties. When some of the secured creditors refused to be intimidated, Obama libeled them in the press, saying, outrageously, "I don't stand with those who held out when everyone else is making sacrifices." Actually, under Obama's plan the politically favored parties, principally the UAW, will benefit--will steal money, to put it crudely--from the parties who held out. Those parties call themselves the "non-TARP lenders."

This highlights the government's conflict of interest in this transaction, as in so many others now underway. Some of Chrysler's secured creditors are banks who received TARP money. As the New York Times put it, those lenders are "beholden to Washington" and "defying the administration was never a serious option."

It remains to be seen what will happen in bankruptcy court. Already one key player, Perella Weinberg Partners, "under intense pressure from the White House," has caved in and agreed to accept Obama's terms. Whatever the ultimate result, this episode will have consequences. The Wall Street Journal notes:If the current plan is pushed through, then good luck to any unionized firm trying to raise secured debt on decent terms in the future.

For Chrysler, the administration's plan spells disaster. It is inconceivable that the UAW, the principal source of Chrysler's problems, will manage the company back to profitability. More likely, Chrysler will become a vehicle through which the federal government provides uneconomic subsidies to unionized auto workers and retirees.

Barack Obama's conduct in this affair has been disgraceful. Our bankruptcy laws are well developed and are fairly implemented by experienced bankruptcy judges. Priority among creditors is established according to legal rules and precedents. The process is transparent and subject to appellate review. But in this case, the law did not favor the parties who have the most influence with the White House--notably, the United Auto Workers--so Obama substituted political threats and bullying for due process. Il Duce would have approved.

I would also suggest you check out this article in the Detroit News- here are a couple good parts:

They are being demagogued as "speculators" by President Barack Obama and as "vultures" by Gov. Jennifer Granholm and Oakland County Congressman Gary Peters.

They are the smaller bondholders who have refused to bow to the pressure of the Obama administration and accept a minuscule number of pennies on the dollar as repayment for their loans to Chrysler.

This confrontation could have been avoided if the Obama administration had treated the bondholders as equitably as the United Auto Workers, which gets far more money for the dollar.

The good-faith loans from the bondholders provided the operating capital for which Chrysler pledged its assets as collateral, an important role that the Obama administration wants to ignore as part of its forced restructuring program that favors the politically connected UAW.

The heavy-handed tactics of the Obama administration represent another government intrusion into the private sector and attempt to victimize a constituency that does not have the political clout of the unions.

The noncompliant bondholders are going to take their chances on winning back a bigger share of their shareholder investments in bankruptcy court, where the independent role of the judiciary will be expected to fairly judge their claims.

One hopes the Obama administration will not try to bully the courts the way it has private businesses.

It already will be tough to raise desperately needed money in the market for Chrysler to make its future vehicles after Obama's intervention and scapegoating of investors as "speculators." Government intimidation would represent an even greater danger to the country and obstacle to Chrysler's future

A smart man would bet money that the bankruptcy process will not be impartial and free from undue influence by government- rule of law has already be disregarded by the President, who wants to run America as he personally sees fit, and so I don't doubt for a second that he will personally pressure judicial appointments to decide the way he wants them to decide. America is dying, and our President is going to stop at nothing to loot the carcass for the benefit of himself and his friends.

UPDATE: Powerlineblog follows up with another good post to read-Banana Republic, Part II

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Aid 'is not solution' for Africa

Richard Dowden a Director of the Royal African Society writes "...As the momentum for Live 8 gathers pace and the pressure on international leaders to deal with Africa's problems mounts, Richard Dowden argues that aid is not the answer.Many argue that aid creates a situation of dependency When a tsunami hits or war creates refugees, the victims can do with some help to get back on their feet wherever they are.Humanitarian relief aid will always be needed when disaster strikes.But the evidence that aid can transform whole societies and lift millions out of poverty is unconvincing.It can only speed up a process that is already happening.When we see scenes of destitution from Africa we assume that we can change things by sending money.But if aid could make Africa prosperous, it would have done so by now.Despite nearly a trillion dollars of aid since independence in the 1960s, much of Africa is worse off now than it was then.Much of that aid was spent by outsiders without consultation with Africans and with little understanding of Africa's ways or needs.Today the continent is full of abandoned projects: wells in the wrong place, factories without a fuel supply, roads that were not maintained.Impoverished by politics But UK Prime Minister Tony Blair and Chancellor of the Exchequer Gordon Brown are proposing to double aid to Africa, promising a Marshall Aid plan, like the help America gave Europe at the end of the Second World War.The comparison is false.In 1945 there was peace in Europe and armies of disciplined and skilled workers stood ready to rebuild. All that was needed was the cash.Africa has rich resources but has been impoverished by bad politics - including our own policies.Africa's nation states that crammed old societies into artificially created countries have not produced effective governments.
It is impossible to deliver education and better health to Africans without working through those governments.The African countries that are well run, South Africa and Botswana for example, do not need aid.At the other end of the spectrum are countries like Somalia and Democratic Republic of Congo which have collapsed as nation states and do not have any effective administration. It is impossible to use development aid there.Those in the middle that are not doing too badly, like Mozambique, Tanzania and Uganda, are already receiving around 50% of their budgets from aid.That makes them more dependent on Western aid donors than they were in colonial times.Aid creates and sustains unequal relationships. Talk of partnerships is false.As one western diplomat in Africa put it to me recently: "We like it when they take ownership of the programme but we mean our programme. We don't like it if they start having their own ideas."No shortcut the aid business is an industry with its own dynamic.Much of it is spent in the donor countries in the form of consultancies and goods.For the recipient it creates dependency, undermines self-reliance and ultimately breeds resentment.There is no short cut to development. Only Africans themselves can bring change to Africa.States have to raise taxes and spend them productively in order for their countries to develop.Aid creates and sustains unequal relationships When state institutions are functioning in support of the people and the economy, there may be a case for helping with specific short term assistance but unless and until the local systems are in place and there is real commitment, aid will be wasted.At present lack of capacity and corruption prevent even basic services being delivered in most of Africa.Outsiders can run one-off projects like immunisation programmes but development has to be done by the people themselves.
Better alternatives Giving aid feels good but there are better ways to help Africa.We must pursue policies that create a fairer system of trade. Current policies and practices in Europe and America damage Africa's chance of earning its living in the world.We must end agricultural subsidies that distort prices allowing cheap food to be dumped in Africa and ruining farmers there. We must lower tariffs and trade barriers to allow Africa to trade more processed goods.We must stop encouraging Africa's brain drain, luring the best educated and talented out of the continent to fill jobs in the West.The British government could also do something about arms flowing into Africa.Weapons that kill in Africa's wars may not be made in Britain but arms dealers base their operations in London and are largely unregulated.
And London has become the laundry of choice for money laundering because Britain applies one of the weakest banking scrutiny systems in the world.We need to start treating money stolen by corruption in the same way as drug money or terrorism funds..."

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Foreign Aid will not Make Poverty History

Alex O. Awiti a fellow at the Earth Institute writes:

Entrepreneurs can catalyse sustainable economic growth by identifying market opportunities and business models that meet the needs of underserved communities in emerging economies. In essence, entrepreneurs can be true allies in poverty alleviation through market solutions, employment and wealth creation as opposed to aid and subsidies. Proponents of foreign aid often think of poverty as a technical problem they can solve using a universal blueprint or Big Plan and huge dollars in financing. If it were that simple poverty would be history. Efforts to alleviate poverty must recognise that poverty is a complex labyrinth of social, institutional, political, historical, geographical and technological factors.

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