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U.S. GDP growth slows to 1.5% in second quarter

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Remember, Democrats took the House and Senate in 2007
Democrats took the House and Senate in January 2007

From CBS Marketwatch.

Excerpt:

The U.S. economy slowed sharply in the second quarter, growing just 1.5% as consumers slashed spending and businesses grew more cautious about hiring and investing, underscoring that an already wobbly recovery is losing even more steam.

In the U.S., though, new government figures showed that growth in gross domestic product, the broadest measure of goods and services churned out by the economy, slowed sharply from the first quarter’s 2% annual rate and the fourth quarter’s 4.1%.

That downward slope in growth is worrisome to economists. As the economy loses steam, a pullback can become self-reinforcing as businesses and consumers worry about the future.

The slowing economy, along with government data showing the recovery has been weaker than thought, raises the specter that a sudden shock—such as an escalation of Europe’s crisis, or next year’s looming tax increases and spending cuts—could shove the U.S. back into recession.

[…]One of the biggest obstacles to recovery is a dearth of consumer spending, which accounts for two-thirds of demand in the economy.

Spending rose 1.5% in the second quarter, lower than 2.4% in the first, reflecting weaker demand for cars and big-ticket items. A big reason is the stagnant labor market. Employers added fewer jobs in the second quarter than they have since the labor market began recovering in 2010.

“The economy is kind of being strangled,” said Bob Baur, chief global economist at Principal Global Investors. “We underestimated how much uncertainty may have contributed to a lack of desire to expand and hire.” Mr. Baur expects 2% to 2.5% growth in the second half of the year but has “grown more cautious,” he said.

[…]Businesses, meanwhile, appear to have grown more cautious about spending. The new GDP report showed that nonresidential fixed investment expanded 5.3% in the second quarter, less than the 7.5% in the first, though spending on equipment and software was healthy. Joseph Carson, an economist at Alliance Bernstein, said: “Uncertainty surrounding U.S. tax laws has created confusion and concern among companies, which has probably depressed investment spending.”

Remember, the Obama administration thinks that higher government dependency “stimulates” the economy:

House Minority Whip Steny Hoyer (D-Md.) said Tuesday that food stamps and unemployment insurance are the two “most stimulative” things you can do for the economy.

During a pen and pad briefing with reporters on Capitol Hill, Hoyer was asked if any Democrats are “reconsidering the wisdom” of letting the Bush tax cuts expire at year’s end for the top income earners given the still struggling U.S. economy.

“I haven’t talked to any who are of that mind,” said Hoyer. “If you talk to economists, they will tell you there are two things that are the most stimulative that you can do — one’s unemployment insurance, the other’s food stamps, okay?”

Of course, all that spending on unemployment and food stamps costs money, so they just borrowed that money from future generations of Americans – your children. The national debt is nearly $16 trillion, but they just keep borrowing. They don’t know what else to do, because they have no idea how jobs are created in the first place.

Republicans think that the best way to stimulate the economy is to create jobs by encouraging businesses to risk their capital in business ventures. But the Republicans aren’t in charge, so we are following the Democrat playbook. Many companies have responded to the Democrat plan to punish “the rich” by expanding their businesses in other countries that are less hostile to job creators. When you introduce burdensome regulations (EPA, Obamacare, Dodd-Frank, etc.) and high corporate taxes (35% – highest in the world!), that means that businesses can hire fewer people at home, and they are forced to expand elsewhere.

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A look at homeschooling and alternatives to college

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I do think that college can still be a good deal as long as you are careful to choose a major that will re-coup the costs of your education in a timely fashion. That will probably mean a STEM degree in something like computer science or petroleum engineering. I myself have the BS and MS in computer science, and I think that those are excellent choices for a man to deliver on his obligation to provide for a family. But it was a much better deal back when tuition was very low, and salaries were very high. Plus, public schools used to me much better at preparing you to go to school to learn STEM subjects. These new problems: underperforming public schools, college debt, and a weak job market, it makes sense to consider alternatives to the mainstream education system.

Here’s an article about homeschooling – an alternative to brick-and-mortar schools – that was posted in the Wall Street Journal.

Excerpt:

Today in the U.S., some two million children are home schooled, growing at an annual rate of 7% to 15% for over a decade, according to the president of the National Home Education Research Institute. The term “home schooler” once implied “isolationist religious zealot” or “off-the-grid anarchist who makes her own yogurt.” Today, it also means military parents who hate to see their kids keep changing schools; or the family with a future Olympian who ice skates five hours a day; or your cousin whose daughter is gifted but has a learning disability. The average home schooler is no longer a sideshow oddity.

“I could never ever teach math,” more than a few parents told me in horror at the very idea of home schooling. Or science. Or a foreign language. But mostly, it was math. Here’s my secret: I can’t teach math either. Once they start calling them integers instead of numbers, I recoil as from a fat, angry snake, which is why Alice takes an online math class, with great lashings of help from her father.

But the biggest thing people want to talk about is socialization. Everyone is worried that I keep my child in a crate with three air holes punched in it and won’t let her have friends until she gets her AARP card. There’s a long answer, of course, but I’ll sum it up this way: Homo sapiens have walked the Earth for at least 130,000 years and, in this time, they learned to be human from their elders, not from their peers. Mandatory education in the U.S. is less than 150 years old. Learning to be a productive adult human by spending a third of every day with other kids might be a good idea, but it’s too soon to tell. I’m still unsure that the people best equipped to teach a 14-year-old boy how to be a man are other 14-year-old boys.

In fact, home-schooled kids are just as socialized as other children. They certainly seem to grow up to be, and feel, fully engaged. One study, by a Canadian home-schooling group, found that 67% of formerly home-schooled adult respondents said they are “very happy,” as opposed to the general population’s 43%. Another study, published in the Journal of College Admission, found that home-schooled students perform better on their ACTs, have higher college GPAs and are more likely to graduate in four years.

So how far would you go with alternatives to mainstream education? Well, the smartest engineer I know doesn’t even have a college degree in computer science – or the student loans that often go with them.

Just look at these numbers: (links removed)

Across the nation, graduates are tossing their caps into the air and investing their hopes of success in their sheepskins. Not since the Magna Carta has so much faith been put into a piece of paper; indeed, belief in the college diploma seems these days to outpace belief in the document that binds a man and a woman. For the past couple of generations, conventional wisdom has said that a college degree is the golden ticket to a great job. For a time, because of the simple laws of supply and demand, this was true.

In 1947, when just 5 percent of Americans age 25 and over held at least a bachelor’s degree, the supply was low, making demand for degreed employees higher. However, with easier access to college through taxpayer-funded student loans, today’s bachelor’s degree has become yesterday’s high-school diploma. Now that over 30 percent of Americans 25 and over have a college degree—and the President has called for that figure to grow to 60 percent—the supply is up, which might help explain why 53 percent of recent graduates are unemployed or underemployed.

What’s more, the burgeoning cost of college means that even for those who do land good jobs after graduation, payoff on their investment will be diminished and take more time. The graduation rates tripled between 1980 and 2010, rising 37 percent between 1999 and 2010. Two-thirds of bachelor’s degree recipients graduated with debt in 2008, compared with less than half in 1993. The average debt for last year’s college was $24,000, while the total outstanding national student debt has passed $1 trillion, more than the nation’s credit card debt. Not surprisingly then, the national student loan default rate is on the rise, too, hitting 8.8 percent for the 2009 budget year. Even the number of Ph.D. holders on public assistance has made recent headlines.

College still works for people, but you have to choose your major more carefully – or just choose to focus on practical skills and then attend a trade school. It’s probably a good idea to put more emphasis on getting work experience at an early age, no matter what you do after high school. Work experience is very important for getting a job, which is why the liberal fixation on higher minimum wage rates hurts younger workers. Sometimes, online degree options can be more cost effective than regular school, but again work has to be done to see where the jobs are and what skills are required before you make a decision.

People sometimes ask me whether this is it for civilization, and I point to new discoveries and feedback mechanisms like these alternatives to government-run or government-regulated schools as an example of how we can get things turned around. What taxpaying parents need to realize is that they have to start thinking practically about laws and policies that promote freedom in education. We have to vote for more choice and competition, and lower taxes, so that we can buy what we want instead of letting an ideologue who has spent his or her entire life in a bubble decide for us.

Commentary

Tea Party conservatives and social conservatives endorse Ted Cruz in Texas primary

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Republican Senate candidate Ted Cruz
Republican Senate candidate Ted Cruz

There is a Republican primary on Tuesday for Kay Bailey Hutchinson’s Senate seat, and my candidate is Ted Cruz. Tea Party leader Sarah Palin recently endorsed him.

Excerpt:

Sarah Palin told a cheering crowd late Friday that America needs to get back to its “clinging to God and guns” roots, as the tea pea party’s biggest names made a series of last-minute, high-profile appearances around Texas to support insurgent conservative U.S. Senate candidate Ted Cruz.

The former Alaska governor and 2008 GOP vice presidential candidate spoke to more than 1,000 boisterous and sweating Cruz supporters gathered under a mercilessly early-evening sun on a grassy knoll in The Woodlands, a well-to-do Houston suburb. She told them that “to make America great, we don’t need a fundamental transformation, we need a fundamental restoration.”

“Fighters like Ted Cruz can lead the charge for us,” Palin said.

Cruz, the former Texas Solicitor General, is locked in a fierce and increasingly nasty battle with the mainstream Texas GOP choice, Lt. Gov. David Dewhurst, for the Republican nomination to replace retiring U.S. Sen. Kay Bailey Hutchison. The pair face a runoff Tuesday because neither won a majority in a nine-Republican senatorial field during the state’s May 29 primary.

The conservative Club For Growth is backing Ted Cruz:

And social conservative leader James Dobson likes Ted Cruz, too.

Excerpt:

Today, we are excited to announce that national pro-life, family values leader Dr. James Dobson is endorsing our Senate campaign.

In his endorsement announcement, Dr. Dobson said: “I’m pleased to endorse Ted Cruz for U.S. Senate because he’s exactly the kind of candidate we need to turn this country around. Religious freedom is under assault every day. We need leaders with the courage to stand strong for conservative values in this battle. Ted Cruz is such a leader—one who will not only vote his convictions in the Senate, but will also lead the fight to defend life, traditional marriage, and religious liberty.”

Dr. Dobson added: “Ted Cruz stands out among conservative leaders across the country today. He has a consistent record of standing up for faith, family, and freedom, and winning values battles on a national level….I urge all Texans who love life, family, faith, and freedom to not only vote for Ted Cruz, but to work hard for his campaign.”

Even moderate conservative George Will thinks that Republican candidate Ted Cruz is the man to replace Kay Bailey Hutchison in Texas.

Excerpt:

For a conservative Texan seeking national office, it could hardly get better than this: In a recent 48-hour span, Ted Cruz, a candidate for next year’s Republican Senate nomination for the seat being vacated by Republican Kay Bailey Hutchison, was endorsed by the Club for Growth PAC, FreedomWorks PAC, talk-radio host Mark Levin and Erick Erickson of RedState.com.

For conservatives seeking reinforcements for Washington’s too-limited number of limited-government constitutionalists, it can hardly get better than this: Before he earned a Harvard law degree magna cum laude (and helped found the Harvard Latino Law Review) and clerked for Chief Justice William Rehnquist, Cruz’s senior thesis at Princeton — his thesis adviser was professor Robert George, one of contemporary conservatism’s intellectual pinups — was on the Constitution’s Ninth and 10th amendments. Then as now, Cruz argued that these amendments, properly construed, would buttress the principle that powers not enumerated are not possessed by the federal government.

[…]At age 14, Cruz’s father fought with rebels (including Fidel Castro) against Cuba’s dictator, Fulgencio Batista. Captured and tortured, at 18 he escaped to America with $100 sewn in his underwear. He graduated from the University of Texas and met his wife — like him, a mathematician — with whom he founded a small business processing seismic data for the oil industry.

By the time Ted Cruz was 13, he was winning speech contests sponsored by a Houston free-enterprise group that gave contestants assigned readings by Frederic Bastiat, Friedrich Hayek and Ludwig von Mises. In his early teens he traveled around Texas and out of state giving speeches. At Princeton, he finished first in the 1992 U.S. National Debate Championship and North American Debate Championship.

As Texas’s solicitor general from 2003 to 2008, Cruz submitted 70 briefs to the U.S. Supreme Court, and he has, so far, argued nine cases there. He favors school choice and personal investment accounts for a portion of individuals’ Social Security taxes. He supports the latter idea with a bow to the late Daniel Patrick Moynihan, who said such accounts enable the doorman to build wealth the way the people in the penthouse do.

Regarding immigration, Cruz, 40, demands secure borders and opposes amnesty for illegal immigrants but echoes Ronald Reagan’s praise of legal immigrants as “Americans by choice,” people who are “crazy enough” to risk everything in the fundamentally entrepreneurial act of immigrating.

You can find out more about Ted Cruz on his positions page. I was interested in his stance on social issues, in particular.

Excerpt:

Ted Cruz has fought to protect innocent human life. He played a leading role in several important cases, including defense of the partial-birth abortion ban, parental consent laws, and prohibiting state funds from going to abortion. These cases have all been part of the ongoing effort to ensure that every child in America  receives the protection and respect he or she deserves.

  • Authored an amicus brief for 13 states, successfully defending the federal Partial Birth Abortion Ban Act. The ban was upheld 5-4 before the U.S. Supreme Court;
  • Authored an amicus brief for 18 states, successfully defending the New Hampshire parental notification law. The law was upheld 9-0 before the U.S. Supreme Court [note: this brief was awarded the Best Brief Award from the National Association of Attorneys General for U.S. Supreme Court briefs written in 2005-06];
  • Successfully defended Texas’s Rider 8, which prohibits state funds for groups that provide abortions, winning unanimously before the Fifth Circuit court of appeals.

Ted Cruz has worked hard in defense of traditional marriage, including his intervention in a case protecting Texas marriage laws. In addition, he has fought on the federal level to defend marriage between one man and one woman as the fundamental building block of society.

  • When a Beaumont state court granted a divorce to two homosexual men who had gotten a civil union in Vermont, Cruz, under the leadership of Attorney General Greg Abbott, intervened in defense of the marriage laws of the State of Texas, which successfully led to the court judgment being vacated;
  • Worked with Attorney General Abbott to send a letter to Congress in support of the federal Defense of Marriage Act.

He has a solid recordconservative policies on that page: energy production, voter fraud prevention, border security, legal firearm ownership – you name it, this guy has been fighting for conservative principles. Like Michele Bachmann, he has actually tried to do pro-life and pro-marriage things. We don’t just have to take his word for it, he has the actions to prove his words.