GaryIvey.Com Posts

There’s a broken record in the media right now.  It’s playing “Obscene Profits…Obscene Profits…Obscene…”  So I got to thinking, how do you define “Obscene Profits?”

In my last post, I pointed out that many people, including many politicians and reporters who babble about the “Obscene Profits” the oil companies are making right now, don’t understand the difference between profit and profit margin.  The dollar amount of profit can be huge for companies like Exxon or BP, but their profit margin (profit as a percentage of revenue) might still be alarmingly small.  After all, there are times that any business will experience a loss, so the times of profit help balance that out.

Also, I pointed out that Government often makes more money on gasoline than oil companies, because government collects taxes without any of the risk the oil companies take.  Thus the title “Can you say H-Y-P-O-C-R-I-S-Y”.

So, what are “Obscene Profits”?  Undoubtedly, the people who use that term are statists who love government or non-profits and think any profit at all is dirty.  However, when a hard-working couple fills their 401k’s with the stocks of public companies, they are counting on those companies making a profit so they won’t starve to death during their declining years.  They would prefer that the profits be as “obscene” as possible.

Also, when a young person get her first job right out of college in a company that has a “last-hired-first-fired” policy, she certainly hopes that the company makes a profit, the more “obscene” the better, or she may be moving back with Mom and Dad.

And when an entrepreneur works 18-hour-days 6 or 7 days a week for 10 years, investing his lifeblood and borrowing every dollar he can, until he finally sees black figures on the bottom line, he needs to start making a profit consistently, or why would he do it?

Why would anyone take the risk of working and investing unless there was the promise of a good return, and why would we begrudge anyone generous rewards of their labors?  If we deny business the rewards of capitalism, the flow of goods and services we count on would cease.  And then where would we be?

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Perhaps nothing illustrates better how Democrats don’t understand economics than the effort now underway to punish the oil companies for the current increases in gasoline prices.  First suggested by President Obama, the Senate tried but failed to pass a bill taking certain tax breaks away from specific large oil companies.

The measure was defeated procedurally and may yet pass.  It specifically targets the five largest oil companies and, since the tax breaks apply to most businesses, not just oil companies, was a blatant attempt to punish these companies for changes in the market, some of which are beyond the oil companies’ control.

Did it never occur to the politicians that raising taxes on companies that produce gasoline can only cause gasoline prices to rise further?  Such obvious logic appears lost on the Democrats, who function on the economically illiterate level of a janitors union member, always sure some faceless, corner-office executive is cheating them just because they’re mean.

The current cliche is that oil companies are making “record profits”.  Trouble is, the dollar amount of profits is meaningless unless you also know the profit margin, which is the percentage of profit compared to gross revenues.  Oil companies actually have razor-thin profit margins and the taxes received by Federal and state governments on each gallon of gasoline is often greater than the profit made by the oil companies.

So the president and the Senators who want to punish the oil companies because gas prices have risen are actually netting more money on each gallon than the oil companies are.

Can you say “H-Y-P-O-C-R-I-S-Y”?

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After the execution of Osama bin Laden, I heard a report which may not have been connected, but it seemed to be.  I think it was ABC News which reported gleefully that gasoline prices were about to plummet 25 cents to levels we haven’t seen since, well, March.  The jubilant tone of the report gave the unmistakable impression that President Obama had vanquished Public Enemy No. 1 and, could it be?  Gasoline prices, the one thing that could harm him in the 2012 reelection bid, were about to fall!

True enough, crude oil prices did fall from about $100 to just above $80 per barrel, prompting prognosticators to predict a corresponding drop in gasoline prices.  Surely the politics gods had smiled on the President and the Democrats!

However, today the price of crude oil futures was over $100 again and average national gasoline prices had fallen less than a penny.  It is true that refineries are about to ramp up production, which is one of the factors that led to the rosy predictions of falling crude prices, but now we have another problem.

It seems that, in addition to the murderous tornadoes that sliced across the South two weeks ago, we are now faced with near-record flooding of the Mississippi River and its tributaries, which are threatening oil refineries in Louisiana with Katrina-like shutdowns.  Thirteen percent of the nation’s domestic fuel production comes from the 11 threatened refineries.  Hence the return to $100-a-barrel crude.

According to this article, futures traders have given up on $80-a-barrel crude prices and are thinking of $100 as “the new $80” and the bottom of the trading ladder.

Yikes!

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I’m often critical of President Obama because I don’t like his world view or his policies one little bit, but today I have to say, he has hit all the right notes with the daring and dangerous raid that resulted in the death of Osama bin Laden.  My congratulations and thanks to the president.

In many ways, this operation was out of character for Obama.  It was well-conceived, planned in detail and executed flawlessly.  No American lives were lost, which is astounding considering the potential for disaster.  At one point it appeared a “Black Hawk Down” disaster could be in the making, when one of the two helicopters’ engine failed and the bird had to be downed and destroyed.  But that eventuality had been planned for and the courageous Navy Seals were able to get in, kill and remove the body of Public Enemy No. 1, and get out to safety.

Also uncharacteristically, no one notified the Pakistanis that we were going in.  That is pretty much an act of war among diplomats, but this was not a time for diplomacy.  Now, the Pakistanis have “some ‘splainin’ to do”, since bin Laden had apparently been living in his large comfortable compound for years, with retired Pakistani military officers living all around him.

Perhaps the thing that will be most unsettling to Obama’s leftwing base is that the intelligence which made the raid possible came directly from the “enhanced interrogation techniques” applied at Guantanamo Bay.

One college student among those who poured out to celebrate in Times Square after the announcement by Obama commented, “Now we can bring our soldiers home from Afghanistan.”  Wrong.  Would that that was the take-away from this, but it is more likely that the War on Terror will escalate as true believers plan retribution.

However, bin Laden was still an important symbol and the fact that America persisted through three presidential administrations to pursue and dispatch the founder of al Qaeda must give at least some extremists pause to realize that, as Obama said, “When Americans set our mind to do something, we can do it.”

One of my Facebook friends correctly noted that it would have been unfortunate to mark the 10-year anniversary of 9-11 with Osama bin Laden still at large.  Now that remembrance will have a completely different flavor.

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We were all amazed and saddened by the tornadoes that ravaged the Southeast last week.  Amazed by nature’s ferocity and saddened by the loss of nearly 350 lives at last count.  I pray for those who are grieving the loss of loved ones, their personal belongings and, in many cases, their livelihoods.

NBC’s Brian Williams anchored a special Friday night that was very well done.  It showed much of the amateur as well as professional video of the storms as well as some poignant stories of survival.  It will take many months, if not years, to recover for many of those affected.

Then toward the end of the program, Williams apparently couldn’t resist pandering to the Climate Change hoaxers.  I could hardly believe my ears when, in an interview with The Weather Channel’s Jim Cantore (whom I’ve met during a brief stint working at the Channel’s Atlanta HQ), Williams asked something like, “What have WE done to cause this?”

Huh?

It was fascinating to watch Cantore try to answer without insulting Williams.  Here’s a paraphrase: “The scientist in me says it isn’t settled,” Jim began, “but in looking at this devastation, I have to wonder what’s going on.”

In other words,”There’s absolutely no proof that anything man does or has done leads to this kind of natural phenomena, but my HEART wants to do something.”

When I worked at the Weather Channel, it was at the peak of the El Niño hysteria, and the top meteorologists there circulated a memo to all Weather Channel employees that we were NOT under any circumstances to imply that El Niño or Global Warming or Climate Change were caused by human activity.  There’s just no scientific basis for it (see my earlier posts here and here).

Williams himself made the point that this was the worst tornado outbreak since the 1930s.  And we all know how bad the SUV’s polluted back then!  Put that together with the fact that we now know that average earth temperatures were higher in the Middle Ages than they are now and it’s obvious  that the idea that our lifestyle somehow causes weather events like tornadoes or that altering our lifestyle could alter the weather is just nonsense.

The hatred for Freedom and Free Enterprise Capitalism is so great on the left that they will miss no opportunity to make the point that we’ve got to change how we live, including shamelessly taking advantage of a tragic natural disaster.  To do so cheapens the human tragedy with political pandering.

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While Congress has delayed crafting a budget for fiscal 2011, which ends September 30, they are already squabbling about what to do about the 2012 budget.  In the meantime though, we are about to bump our heads on the debt ceiling, which is currently $14.294 trillion.  That’s because the Federal government is borrowing $189 million dollars AN HOUR! (article)

A few years ago, the debt ceiling was a mere $12 trillion, yet George W. Bush wanted to raise it.  Senator Barack Obama voted against it then, but he is pushing it now.  I wonder, did Obama vote “no” because it was ONLY going up to $14 trillion?

Anyway, Obama and most Democrats and thoughtful, chin-stroking Keynesian economists and MSM pundits now say we “must” raise the debt ceiling to maintain our credibility.  Really?

One analysis says it would take the entire economic production of private business in the United States in 2010 to retire our national debt.  How is increasing our debt  going to help our credibility when we are hurtling toward ruin as it is?  Standard and Poor’s is threatening to reduce the nation’s credit rating because of our runaway debt.  Rather than saying we “must” raise the debt ceiling, it would seem we ought to be saying the opposite.

The only solution the Democrats can see is to raise taxes, but we are already taxed too much.  They also talk about “fairness” but there is nothing “fair” about our tax code currently.

One illustration I saw recently compared a hypothetical single mother making $14,000 per year with a couple with combined gross income of $60,000 (both families have the same number of children).  The single mother can get food stamps, Aid to Dependent Children, childcare assistance, housing subsidies, Medicaid, etc. that increase her spending power to $37,000.  The working couple makes too much to get any government assistance, PLUS their tax burden and household expenses reduces their spendable cash to $34,000!

While I understand that the single mother would have trouble making it on $14,000 a year, is it really “fair” that she has more spendable cash than a family where both spouses are working full time? Shouldn’t the government be going after the deadbeat dad to help the single mom?

It goes without saying that $60,000 per year earned by two people is not “rich” and certainly not the “millionaire/billionaire” status that Obama regularly demonizes.  Yet the Democrats never miss an opportunity to raise taxes on people earning more than other people.

I say the Federal government needs to “Stop the Insanity” and get the spending under control like every household and private business and nonprofit in the country is having to do right now.  Where is it written that government can never tighten its belt?

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Jay Carney, the relatively new Press Secretary for President Obama, stepped in it this week when journalists asked him why there was no formal Easter Proclamation from the president this year, like past presidents have done for most of our history.  Carney’s reaction was to make fun of the questioner.  He laughed and belittled the question with sarcasm, saying “I’m glad you’re asking about important issues”, or words to that effect.

If Obama was a Republican we would be reading about how out of touch the White House is, since nearly 80% of Americans are Christians and probably 75% of those were in church Sunday morning.  People who don’t darken a church door the rest of the year are usually in church on Easter.  Few experiences are more universal in America.

The contrast is made more stark when you realize that the White House has issued official proclamations honoring several Muslim holidays on multiple occasions.

After callously laughing at the question, Carney launched into a defense of Obama by recounting how he had gone to church on Easter Sunday, as if to say, “and furthermore, Obama is most definitely a Christian!” — referring to the fact that the numbers who believe Obama is really Muslim remain high.

As it turns out, Obama’s Easter church attendance has its own set of problems, since the pastor of the church he chose is on videotape calling all the personalities on talk radio and Fox News racists.  Nothing crazy about that! (See what I did there? I used sarcasm just like Jay Carney).

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I have a book that I had nearly forgotten about until I was rearranging one of my floor-to-ceiling shelves today.  It was most appropriate that I found it today, between Good Friday and Easter.  The title is “I Believe in the Resurrection of Jesus”.  The book is by George Eldon Ladd and it’s probably been 25 years (or 35?) since I read it, but I still remember the main premise of the book, and just as the resurrection was the rock of faith for believers in the first century, Ladd’s book helped it to undergird my own faith.

The essence of the book is that the resurrection of Jesus is not a miracle to be tested by the scientific method, although there are definite scientific questions raised by it.  However, the real reason to believe is that those first century believers did.  And many, many of them endured tortuous martyrdom rather than recant their faith.

Ladd says, rather than the proof of biological science, we should be asking if the testimony of those early believers would stand in a court of law.  That’s the kind of proof that counts in this situation.  And of course, the evidence speaks for itself.  All but one of those 12 apostles who were there as eye witnesses died brutal, violent deaths at the hands of unbelieving rulers rather than deny what they had seen and experienced.  People just don’t brave horrible deaths for something they know to be untrue.

Of course this is just the bedrock of faith.  The benefits of believing go far beyond to Forgiveness, Hope, Salvation and Victory.

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In a speech at a Virginia college, President Obama said, “I want to live in a country that’s fair.”  Now who could disagree with that?  Certainly not most of those college students, who, if they are like most young people, are easily stirred up with indignation toward any injustice, because they still believe that life can be fair.

But life experience tends to teach most of us that there are simply too many variables for life to be remotely similar for everyone, much less “fair”, whatever that means.

About the most it can mean is that we all start with as level a playing field as possible.  Of course it won’t be level, because heredity, IQ, physical prowess, gender, race, culture, attitude and many other factors do much to determine our chances of success and happiness in life, so there can never be a truly level playing field.  Civil rights legislation of various types seeks to ensure that people aren’t hampered by prejudice regarding surface things like race, gender, disabilities, etc., but no law can equalize the chances of one person with bottomless drive to succeed and another without an ambitious bone in his body.

Of course Obama’s main concern is with people who have more money than other people, but, there are many reasons one person may have more money than another.  The most obvious reason is that some people don’t have a goal of becoming rich.  The irony is that many of those same people think it’s not fair that they aren’t rich, even though they did none of the things one must do to become rich.  Becoming rich is hard work, and most people who are rich have also been under soul-crushing poverty during their rise to the top.  In short, it ain’t easy.  Even some who try to get rich, ultimately fail.

But many people who have taken the easy 9-to-5 job don’t seem to realize that and think they should receive the same rewards as someone who risked everything and expended their blood to build a business that might someday make them rich (Few people become rich working for a salary; just a few upper management types.  Most of the rich got there by starting businesses.  Not everyone has the stomach for that)

Obama’s idea is to take money from people who have it and give it to people who don’t.  This, he thinks, will make the country more “fair”.  But I couldn’t disagree more, since taking money at gunpoint from one person who earned it “fair and square” (so to speak) and giving it to someone who did nothing except “need” it, seems profoundly UNFAIR.

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I had to look it up online to be sure I heard right after hearing a byte from President Obama’s speech last Wednesday.  Apparently, referring to the Bush tax cuts, he did actually say we’ve got to reduce the “spending in our tax code.”  Huh?

Then it hit me: the reason Obama so often seems to live in some Bizzare-O World is that he thinks ALL money belongs to the government and if you have any money in your pocket it’s because the government “spent” it!  To Obama a tax cut is spending!  Ironically, he also calls government spending “investment”, which it obviously is NOT, since there’s no prospect of a return.  But that’s life in Obama’s world.

This attitude is so foreign to me that it was practically invisible, but now much has been made clear and it is very frightening.  Now it’s clear why 16,000 IRS agents have been hired since Obama took office.  His concern isn’t for you and me and our welfare but his focus is to make sure that you and I aren’t taking too much money from his beloved government!

The 2012 election can’t come soon enough.

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