Imagine taxpayers' chagrin when they learned this week that $38 billion isn't what it used to be. It could happen only in Washington, where the President and both parties have tried to hoodwink Americans with a bogus budget agreement that offers little hope the country's deficit problem will ever be addressed responsibly.
While the Beltway in-crowd jockeyed to claim credit for reducing the 2011 budget by "historic" levels, it was left to the Congressional Budget Office to expose the shabby charade. It turns out the spending cuts were not as advertised.
After examining the proposed budget deal, the CBO determined that the planned reductions will only trim federal outlays by $352 million below 2010 spending. The nonpartisan budget agency's findings sent Washington politicians scrambling for cover.
Try as they might, the Capitol spin machine could not explain how $38 billion overnight became $352 million. According to the CBO, the plan used accounting gimmicks, cuts to reserve funds and counted funding that was not going to be spent in the current budget.
Under the agreement, the actual reductions are one-hundredth of what Republicans and Democrats trumpeted publicly when the deal was reached. This sham was foisted on the American public by a media that rushed to laud the downsizing before checking the facts.
Now that the truth has surfaced entrenched Washington politicos are still trying to sell the idea that this is a good deal for taxpayers. Their collective arrogance is an insult to every American of all political stripes.
Meanwhile, the federal deficit continues to march skyward. In just the first six months of the current fiscal year, the budget deficit zoomed up 15.7 percent. That staggering increase added another $829 billion to government debt.
At the current spending pace, the federal budget will bleed $1.4 trillion in red ink for the year. As a consequence, government debt will soon bump up against the $14.2 trillion debt ceiling. Raising the debt limit will require Congressional approval.
The media is salivating over another high stakes political battle like the one that just resulted in the budget trimming fiasco. Mainstream news outlets snookered Americans with coverage of the impending doom of a government shutdown. It spooked Republicans who caved as the clock ticked down.
Now President Obama is already daring Republicans to play "chicken" with the debt ceiling. When Obama was a senator, he voted against raising the debt limit, scolding then President Bush for his lack of leadership on deficit reduction. By the president's own definition, apparently the nation still has a leadership problem.
The president and his legions of foot soliders are warning that refusal to increase the debt ceiling will lead to financial Armageddon. Watch as the media takes up the chant. For their part, Republicans are talking bravely, but their leadership will crumble when the media heat reaches the boiling point.
Where does that leave ordinary citizens? Unfortunately, the less than 50 percent of Americans who actually pay taxes in the country are on the hook to pick up the tab for Washington's refusal to enact meaningful budget reform.
It is a sorry state of affairs. The government will continue to grow. Budgets will get fatter. Washington will borrow more money. The country will sink deeper into debt and prospects for economic growth will dim.
Our political leaders should be ashamed. Instead they want us to believe they are now really getting serious about shaving the deficit. Based on the budget deal, nothing could be further from the truth.
Wednesday, April 13, 2011
Monday, April 4, 2011
Birth Tourism: Your Tax Dollars At Work
Most taxpayers have never heard of the thriving cottage industry of birth tourism. Thousands of foreigners are traveling to the United States under false pretenses each year for the sole purpose of giving birth to a child.
Often these pregnant women enter our country on temporary stays granted by the government. Some obtain student visas. Others arrive as guest workers. Those who can't get some kind of temporary status come as tourists.
Many, but not all, new arrivals receive free health care. But the real prize is something worth a lot more. Under the law, any child born in the United States automatically becomes a citizen. It matters not that the woman is a citizen of another country or that she may have arrived illegally.
No wonder birth tourism is booming. California officials recently shut down a makeshift maternity ward in San Gabriel that was catering to birth tourists from China. For a fee, Chinese women were given a chance to deliver their babies in the U.S. to guarantee citizenship.
When they raided the location, officials found 10 mothers and seven newborns living in three townhouses that had been converted into maternity wards. According to authorities, Southern California has become a hub for the nascent industry.
The Center for Immigration Studies recently released a report showing that nearly 200,000 children were born in the U.S. to temporary foreign visitors. In at least 20 percent of these cases, the women came to the country for the sole purpose of giving birth.
Those statistics only tell half the story. The study also found that another 300,000 children are born to daughters of illegal alien parents each year. The government automatically confers citizenship on those children.
You're excused if you have never heard about these issues. The mainstream media has deliberately suppressed the news because it does not fit with their immigration views. However, a group of congressmen has taken notice.
More than 70 House members have signed on as sponsors of the Birthright Citizenship Act of 2011 (HR 140), introduced by Republican representative Steve King of Iowa. The bill would require at least one parent to be a U.S. citizen or permanent resident for a newborn to receive automatic citizenship.
The proposal makes so much sense that its chances of becoming law are almost nil. Opponents will claim that bill flies in the face of the 14th Amendment to the Constitution, which grants citizenship to all persons born or naturalized in the United States.
The amendment, ratified by the states in 1868, was originally aimed at providing citizenship to children born of African slaves. Supporters never imagined the law would be abused by foreigners bent on gaining citizenship for their babies.
Proponents of HR140 contend the amendment gives Congress the authority to define birthright citizenship. The United States is one of only two industrialized nations--the other is Canada--to grant birthright citizenship. By the way, Mexico has no such law. Yet Mexican officials support birthright citizenship in the U.S.
If the birthright bill ever becomes law, it likely will land in the laps of the Supreme Court justices. Democrats will no doubt challenge the law on the basis that the 14th Amendment cannot be altered in any way.
Meanwhile, taxpayers must pick up the tab for this foreign exploitation. They are on the hook for health care for the mother and newborn. Once the babies are U.S. citizens, they have the same rights as all Americans, including access to free government medical and welfare programs.
No question these are unintended consequences of the 14th Amendment. Now it is up to Congress to fix the mess. It will require political courage because the Democrats, Latinos and immigration activists will take umbrage.
Unfortunately, political courage is one commodity in short supply in Washington these days.
Often these pregnant women enter our country on temporary stays granted by the government. Some obtain student visas. Others arrive as guest workers. Those who can't get some kind of temporary status come as tourists.
Many, but not all, new arrivals receive free health care. But the real prize is something worth a lot more. Under the law, any child born in the United States automatically becomes a citizen. It matters not that the woman is a citizen of another country or that she may have arrived illegally.
No wonder birth tourism is booming. California officials recently shut down a makeshift maternity ward in San Gabriel that was catering to birth tourists from China. For a fee, Chinese women were given a chance to deliver their babies in the U.S. to guarantee citizenship.
When they raided the location, officials found 10 mothers and seven newborns living in three townhouses that had been converted into maternity wards. According to authorities, Southern California has become a hub for the nascent industry.
The Center for Immigration Studies recently released a report showing that nearly 200,000 children were born in the U.S. to temporary foreign visitors. In at least 20 percent of these cases, the women came to the country for the sole purpose of giving birth.
Those statistics only tell half the story. The study also found that another 300,000 children are born to daughters of illegal alien parents each year. The government automatically confers citizenship on those children.
You're excused if you have never heard about these issues. The mainstream media has deliberately suppressed the news because it does not fit with their immigration views. However, a group of congressmen has taken notice.
More than 70 House members have signed on as sponsors of the Birthright Citizenship Act of 2011 (HR 140), introduced by Republican representative Steve King of Iowa. The bill would require at least one parent to be a U.S. citizen or permanent resident for a newborn to receive automatic citizenship.
The proposal makes so much sense that its chances of becoming law are almost nil. Opponents will claim that bill flies in the face of the 14th Amendment to the Constitution, which grants citizenship to all persons born or naturalized in the United States.
The amendment, ratified by the states in 1868, was originally aimed at providing citizenship to children born of African slaves. Supporters never imagined the law would be abused by foreigners bent on gaining citizenship for their babies.
Proponents of HR140 contend the amendment gives Congress the authority to define birthright citizenship. The United States is one of only two industrialized nations--the other is Canada--to grant birthright citizenship. By the way, Mexico has no such law. Yet Mexican officials support birthright citizenship in the U.S.
If the birthright bill ever becomes law, it likely will land in the laps of the Supreme Court justices. Democrats will no doubt challenge the law on the basis that the 14th Amendment cannot be altered in any way.
Meanwhile, taxpayers must pick up the tab for this foreign exploitation. They are on the hook for health care for the mother and newborn. Once the babies are U.S. citizens, they have the same rights as all Americans, including access to free government medical and welfare programs.
No question these are unintended consequences of the 14th Amendment. Now it is up to Congress to fix the mess. It will require political courage because the Democrats, Latinos and immigration activists will take umbrage.
Unfortunately, political courage is one commodity in short supply in Washington these days.
Sunday, April 3, 2011
Fed Secretly Bails Out Big Foreign Banks
At the height of the economic crisis when consumers and businesses were starved for credit, the Federal Reserve tossed a lifeline to foreign banks. The agency made a mind-boggling $274.1 billion in loans to non-U.S. institutions and then deliberately concealed the information from the public.
Fed Chairman Ben Bernanke, the bearded banking bungler, orchestrated the lending and then battled for the past two years to keep the loans secret. The U.S. Supreme Court stepped in last week and ordered the information to be released to the public. As a result, Bernanke's already wounded credibility suffered a mortal blow.
In his defense, Bernanke protested weakly that allowing news of the loans to become public would have negatively affected the foreign banks. Perhaps, that could have been argued with some credibility at the time the loans were made. But two years after the fact? That's sheer nonsense.
Moments after the disclosures were made, Texas representative Ron Paul announced plans to hold public hearings on the Fed's decision to shovel out gargantuan loans to foreign banks. In a statement, Paul said he was "deeply disturbed" to learn of the "staggering" size of the loans. Like Paul, most Americans were outraged.
However, the always compliant news media dutifully buried the details. USA Today ran a one-inch brief on the front of its business page. Others in the print cheering section sheepishly followed. What should have been front page coverage became another excuse for the media to remind the public that the loans saved America from the brink of disaster.
The media's argument is hogwash. Branch offices of foreign-owned banks took advantage of the Fed's generous lending program to avoid pumping capital from Europe, Asia and China into their U.S. subsidiaries. In addition, the favorable loans provided the opportunity for foreign banks to double-dip because most received bailout money in their home countries, too.
Unfortunately, what the Fed did was not illegal. The Monetary Control Act of 1980 allows foreign banks with reserves at the Fed to take advantage of what is called a discount-window credit, a policy that allows institutions to borrow money from the central bank at below market rates.
The Fed was quick to point out that all the loans had been repaid with interest in an attempt to justify their actions. Bernanke and other Fed board members seemed perplexed at the idea their methods were being called into question.
However, the Fed's defense fails to address the larger question of how those billions might have otherwise been spent. For example, billions could have been used to bail out U.S. homeowners battling foreclosure. Millions could have been lent to credit-squeezed small businesses that could no longer get loans after the crisis hit. And what about those consumers who couldn't find lending for cars, refrigerators and other goods?
Instead of looking out for taxpayers, the government thumbed its nose at consumers and businesses by taking billions of dollars out of circulation and handing it over to foreign bankers.
Propping up foreign banks has done nothing to restore the American economy. Zero. Nada. Zilch. No amount of news coverage or economic mumbo jumbo will change that fact. That's why Ron Paul is right to demand an explanation from Bernanke on two counts: lending the money in the first place and then hiding the fact.
More Americans need to know what happened behind closed doors. Public airing of the Fed's sleazy behavior is the only way to ensure that Bernanke and the Fed are held accountable for the billions of dollars the central bank oversees.
Fed Chairman Ben Bernanke, the bearded banking bungler, orchestrated the lending and then battled for the past two years to keep the loans secret. The U.S. Supreme Court stepped in last week and ordered the information to be released to the public. As a result, Bernanke's already wounded credibility suffered a mortal blow.
In his defense, Bernanke protested weakly that allowing news of the loans to become public would have negatively affected the foreign banks. Perhaps, that could have been argued with some credibility at the time the loans were made. But two years after the fact? That's sheer nonsense.
Moments after the disclosures were made, Texas representative Ron Paul announced plans to hold public hearings on the Fed's decision to shovel out gargantuan loans to foreign banks. In a statement, Paul said he was "deeply disturbed" to learn of the "staggering" size of the loans. Like Paul, most Americans were outraged.
However, the always compliant news media dutifully buried the details. USA Today ran a one-inch brief on the front of its business page. Others in the print cheering section sheepishly followed. What should have been front page coverage became another excuse for the media to remind the public that the loans saved America from the brink of disaster.
The media's argument is hogwash. Branch offices of foreign-owned banks took advantage of the Fed's generous lending program to avoid pumping capital from Europe, Asia and China into their U.S. subsidiaries. In addition, the favorable loans provided the opportunity for foreign banks to double-dip because most received bailout money in their home countries, too.
Unfortunately, what the Fed did was not illegal. The Monetary Control Act of 1980 allows foreign banks with reserves at the Fed to take advantage of what is called a discount-window credit, a policy that allows institutions to borrow money from the central bank at below market rates.
The Fed was quick to point out that all the loans had been repaid with interest in an attempt to justify their actions. Bernanke and other Fed board members seemed perplexed at the idea their methods were being called into question.
However, the Fed's defense fails to address the larger question of how those billions might have otherwise been spent. For example, billions could have been used to bail out U.S. homeowners battling foreclosure. Millions could have been lent to credit-squeezed small businesses that could no longer get loans after the crisis hit. And what about those consumers who couldn't find lending for cars, refrigerators and other goods?
Instead of looking out for taxpayers, the government thumbed its nose at consumers and businesses by taking billions of dollars out of circulation and handing it over to foreign bankers.
Propping up foreign banks has done nothing to restore the American economy. Zero. Nada. Zilch. No amount of news coverage or economic mumbo jumbo will change that fact. That's why Ron Paul is right to demand an explanation from Bernanke on two counts: lending the money in the first place and then hiding the fact.
More Americans need to know what happened behind closed doors. Public airing of the Fed's sleazy behavior is the only way to ensure that Bernanke and the Fed are held accountable for the billions of dollars the central bank oversees.
Friday, April 1, 2011
Factoids That You Can Use
Using your cell phone to make payments for merchandise is the next technology wave poised to hit the wireless industry. Although its not a new idea, implementation has been slow in the U.S. compared to Asia, Europe and other countries. Now more software providers are knitting the capability into their operating systems for smartphones. Microsoft recently hinted it planned to make the software available soon. Google already has bolted on payment capability in its Android operating system for cell phones. Wireless observers expect Apple to soon upgrade its software to match Goggle. Retailers are also gearing up with transaction scanners that work with wireless handsets. Starbucks already has inserted the readers at cash registers in most of their stores. In 2010, mobile payments for goods and services topped the $30 billion mark globally. Gartner research expects the figure to mushroom to $245 billion by 2014. Handset manufacturers have taken notice. According to Gartner, cell phones shipped with the payment software will reach 35 million by the end of this year. That number is expected to double by next year. By 2014, Gartner projects that 340 million global wireless users will make payments for merchandise with a tap on the handset screen.
Thursday, March 31, 2011
The Largest Ponzi Scheme in History
Your government is operating a brazen Ponzi scheme that would make even Bernie Madoff blush. Yet no Congressman will ever face prosecution. No federal bureaucrat will ever go to jail. And the current administration denies taxpayers are being scammed.
What's this scandalous fraud? Social Security. Americans have been duped into believing the money deducted from their paychecks for Social Security benefits are being deposited in a trust fund for safekeeping until they retire. It is a bald-faced lie perpetuated by the current administration.
Payroll deductions are funneled to the Social Security trust fund. However, Congress has regularly raided the fund to spend your retirement income on government largess. As a result, it is currently insolvent. If Social Security were an investment fund, the Securities and Exchange Commission would have shut it down for fraud.
How did this happen? Congress has "borrowed" from the fund for decades. When it takes Social Security dollars, it deposits a government IOU in the account. These are nothing more than useless pieces of paper that promise the government will pay back the money when you retire.
For years, the Social Security payroll deductions were more than the dollars paid out to beneficiaries. As the ratio between workers and retirees has shrunk, the situation has reversed. The government is now paying out more money than it receives through payroll deductions.
Social Security reached a tipping point last year. It ran a $37 billion deficit. The government had to borrow money to make up the difference. The money did not come from the federal budget. Because of the huge federal deficit, Social Security is actually being financed by China, Japan, Saudi Arabia and other countries that purchase our debt.
The Congressional Budget Office projects that Social Security will run a $45 billion deficit this year. Every year hereafter the red ink will gush. By 2021, the CBO estimates the deficit will balloon to $118 billion. Simply put, the Social Security fund does not have the money to meet its financial obligations.
Unfortunately, the problem will only grow worse. If nothing is done to fix Social Security, the system's trustees estimate that benefits will have to be cut by 22 percent in 2037 and more each succeeding year. These are dire predictions that have daunting consequences for Americans if Washington continues to keep its head in the sand.
Yet, here was President Obama's own budget director Jacob Lew tugging on the wool that covers Americans' eyes. He recently wrote in USA Today that the Social Security Trust fund is "solvent until 2037." Lew apparently doesn't understand the definition of the word "solvent."
Here's what makes Lew's assurances so sinister. As budget director under President Clinton, this same Lew explained in 2000 that the Social Security trust fund "balances" were nothing more than a "bookkeeping" device. In his own words: "They do not consist of real economic assets that can be drawn down in the future to fund benefits."
Lew's weasel words mean that there is no money sitting in some vault ready to be paid out. The fund is bankrupt. Each year it depends on the payroll deductions to meet current obligations. Now the obligations exceed the income.
It is time to end the lies about Social Security. President Obama and Congress need to admit the obvious and tackle the issue by raising the retirement age for future beneficiaries and changing the indexing formula that pegs benefit increases to inflation. Just those two fixes will go a long way to restoring solvency.
However, don't hold your breath waiting for that to happen. President Obama wants to use protecting Social Security entitlements as a linchpin in his 2012 election campaign. That's why he trotted out Jacob Lew to lay the groundwork with his ridiculous claim about solvency.
Bernie Madoff must be shaking his head in disbelief. He sits in prison for a scheme that bilked people out of billions of dollars. Meanwhile, the Congressmen and women who stole trillions of dollars from your Social Security trust will never face jail time.
What's this scandalous fraud? Social Security. Americans have been duped into believing the money deducted from their paychecks for Social Security benefits are being deposited in a trust fund for safekeeping until they retire. It is a bald-faced lie perpetuated by the current administration.
Payroll deductions are funneled to the Social Security trust fund. However, Congress has regularly raided the fund to spend your retirement income on government largess. As a result, it is currently insolvent. If Social Security were an investment fund, the Securities and Exchange Commission would have shut it down for fraud.
How did this happen? Congress has "borrowed" from the fund for decades. When it takes Social Security dollars, it deposits a government IOU in the account. These are nothing more than useless pieces of paper that promise the government will pay back the money when you retire.
For years, the Social Security payroll deductions were more than the dollars paid out to beneficiaries. As the ratio between workers and retirees has shrunk, the situation has reversed. The government is now paying out more money than it receives through payroll deductions.
Social Security reached a tipping point last year. It ran a $37 billion deficit. The government had to borrow money to make up the difference. The money did not come from the federal budget. Because of the huge federal deficit, Social Security is actually being financed by China, Japan, Saudi Arabia and other countries that purchase our debt.
The Congressional Budget Office projects that Social Security will run a $45 billion deficit this year. Every year hereafter the red ink will gush. By 2021, the CBO estimates the deficit will balloon to $118 billion. Simply put, the Social Security fund does not have the money to meet its financial obligations.
Unfortunately, the problem will only grow worse. If nothing is done to fix Social Security, the system's trustees estimate that benefits will have to be cut by 22 percent in 2037 and more each succeeding year. These are dire predictions that have daunting consequences for Americans if Washington continues to keep its head in the sand.
Yet, here was President Obama's own budget director Jacob Lew tugging on the wool that covers Americans' eyes. He recently wrote in USA Today that the Social Security Trust fund is "solvent until 2037." Lew apparently doesn't understand the definition of the word "solvent."
Here's what makes Lew's assurances so sinister. As budget director under President Clinton, this same Lew explained in 2000 that the Social Security trust fund "balances" were nothing more than a "bookkeeping" device. In his own words: "They do not consist of real economic assets that can be drawn down in the future to fund benefits."
Lew's weasel words mean that there is no money sitting in some vault ready to be paid out. The fund is bankrupt. Each year it depends on the payroll deductions to meet current obligations. Now the obligations exceed the income.
It is time to end the lies about Social Security. President Obama and Congress need to admit the obvious and tackle the issue by raising the retirement age for future beneficiaries and changing the indexing formula that pegs benefit increases to inflation. Just those two fixes will go a long way to restoring solvency.
However, don't hold your breath waiting for that to happen. President Obama wants to use protecting Social Security entitlements as a linchpin in his 2012 election campaign. That's why he trotted out Jacob Lew to lay the groundwork with his ridiculous claim about solvency.
Bernie Madoff must be shaking his head in disbelief. He sits in prison for a scheme that bilked people out of billions of dollars. Meanwhile, the Congressmen and women who stole trillions of dollars from your Social Security trust will never face jail time.
Thursday, March 24, 2011
Letters from O.H. Bama
Dear Secretary of Defense Gates:
As your commander-in-cheese, it is my duty to spell out the specific mission in Libya for our brave young men and women that have been sent in harm's way. Therefore, let me be absolutely crystal clear about the outcome. I call this the O.H. Bama Doctrine.
Colonel Gadhafi, a dictator with a bad case of acne and a funny hat, must go. That is Job One. However, if he decides to stay, then our duty is to prevent the murder of civilians. But we should only drop bombs to stop the slaughter of innocents. No ground troops. If that doesn't work, we should dither and procastenate. And remember, this is not a war. Killing dictators and their armed forces is a civil way to register our displeasure with Gadhafi. As a reminder, this mission is subject to change, depending on polling data and news coverage.
Excuse me for being so direct with my expectations. It is necessary because Gadhafi refuses to be swayed by my soaring rhetoric urging him to get out of Dodge or wherever he resides. Speaking of nut jobs, please disregard anything Secretary of State Hilliary Clinton utters on this subject. Obviously, all those years explaining Bill's womanizing has left a serious disconnect between her tongue and the truth.
I know you recommended that I get approval from Congress before launching this action. But that suggestion is soooooo George Bush. I am way too busy to trot over to Capitol Hill to explain what Americans are doing in Libya. I have Final Four brackets to manage, golf courses to test and other pressing issues, like visiting Brazil.
Speaker of the House John Boehner will have to haul the French or the Germans or whomever is in charge of this non-war to Congress to explain our involvement. This is their little conflict. I am just going along to show the Muslin world that America is a kinder, gentler nation with me in charge. Think of those bombs as a friendly reminder that America is tolerant of all religions.
Now, I know some folks are insisting that I return that Nobel Peace Prize because of this misunderstanding with Gadhafi. How tacky! You can love peace and still bomb the hell out of a small, insignificant country. There is nothing hypocritical about that.
By the way, next time you see our beloved Vice President "Plugs" Biden could you please explain what a no-fly zone is? After he heard about the Libyan campaign, he rushed into the Oval Office, flapping his arms and clicking his heels. "You have my full support on this decision," he schmoozed. He then dropped his pants and pointed to his underwear. "See, no fly!" he exclaimed.
I know its scary thinking Old Plugs is next in line for the presidency, but be patient with him. He personally saved 3 million jobs, you know.
Your favorite Sorta War Time President,
O.H. Bama
As your commander-in-cheese, it is my duty to spell out the specific mission in Libya for our brave young men and women that have been sent in harm's way. Therefore, let me be absolutely crystal clear about the outcome. I call this the O.H. Bama Doctrine.
Colonel Gadhafi, a dictator with a bad case of acne and a funny hat, must go. That is Job One. However, if he decides to stay, then our duty is to prevent the murder of civilians. But we should only drop bombs to stop the slaughter of innocents. No ground troops. If that doesn't work, we should dither and procastenate. And remember, this is not a war. Killing dictators and their armed forces is a civil way to register our displeasure with Gadhafi. As a reminder, this mission is subject to change, depending on polling data and news coverage.
Excuse me for being so direct with my expectations. It is necessary because Gadhafi refuses to be swayed by my soaring rhetoric urging him to get out of Dodge or wherever he resides. Speaking of nut jobs, please disregard anything Secretary of State Hilliary Clinton utters on this subject. Obviously, all those years explaining Bill's womanizing has left a serious disconnect between her tongue and the truth.
I know you recommended that I get approval from Congress before launching this action. But that suggestion is soooooo George Bush. I am way too busy to trot over to Capitol Hill to explain what Americans are doing in Libya. I have Final Four brackets to manage, golf courses to test and other pressing issues, like visiting Brazil.
Speaker of the House John Boehner will have to haul the French or the Germans or whomever is in charge of this non-war to Congress to explain our involvement. This is their little conflict. I am just going along to show the Muslin world that America is a kinder, gentler nation with me in charge. Think of those bombs as a friendly reminder that America is tolerant of all religions.
Now, I know some folks are insisting that I return that Nobel Peace Prize because of this misunderstanding with Gadhafi. How tacky! You can love peace and still bomb the hell out of a small, insignificant country. There is nothing hypocritical about that.
By the way, next time you see our beloved Vice President "Plugs" Biden could you please explain what a no-fly zone is? After he heard about the Libyan campaign, he rushed into the Oval Office, flapping his arms and clicking his heels. "You have my full support on this decision," he schmoozed. He then dropped his pants and pointed to his underwear. "See, no fly!" he exclaimed.
I know its scary thinking Old Plugs is next in line for the presidency, but be patient with him. He personally saved 3 million jobs, you know.
Your favorite Sorta War Time President,
O.H. Bama
Wednesday, March 23, 2011
Sprint: the ugly duckling seeking a suitor
With the announcement of AT&T's purchase of T-Mobile, the nation's third largest wireless carrier Sprint was left stranded again at the merger altar. Despite frantic proposals, the company has failed to woo a marriage partner.
Sprint CEO Dan Hesse took out his frustrations on AT&T, claiming the consolidation would give the merged firms too much economic power in the mobile market. "I have concerns it would stifle innovation," Hesse whined in a speech.
Most observers think Hesse doth protest too much. Sprint would like nothing better than to arrange for a corporate marriage that would increase its market share. In fact, the word on the street is that Sprint did more than just flirt with T-Mobile, hoping to land a deal of its own.
When Sprint's overtures were rejected, Hesse began acting like the jilted lover, stamping his feet in disapproval of the AT&T and T-Mobile marriage. Apparently, his failure to negotiate a deal for Sprint precludes other wireless firms from acting in their self-interests.
Perhaps, Hesse should spend less time appearing in Sprint's snooze-inducing television commercials and more attention fixing his firm's performance. The Overland Park, Kansas, based wireless company carded a stunning $595 million operating loss last year as it struggled to increase its market share.
Most of the company's growth in 2010 was prepay customers, less lucrative than post-paid subscribers on monthly rate plans. At the end of the year, Sprint had 49.9 million wireless subscribers, of which 12.3 million were pre-pay customers, according to the company. That means these bottom feeders represent nearly one-quarter of the company's subscriber base.
Unfortunately, Sprint's cost structure is hamstrung because it operates two incompatible wireless networks. This is a legacy of its ill advised 2005 purchase of Nextel, which operated a walkie-talkie mobile network. To call the $6.5 billion merger a failure would be too kind. It was an unmitigated disaster.
Sprint overpaid for a technology that was being fast becoming obsolete by the emergence of feature rich phones. At the time of the merger, Nextel was the third largest wireless company and Sprint was a solid fourth. Six years after the merger, Sprint is mired in third place, stuck between giants AT&T and Verizon and a host of bit players at the low end.
Unfortunately, Sprint has learned nothing from its past corporate pratfalls. The company is pursuing WiMax as its technology choice on its speedier 4G network in an uneasy partnership with Clearwire. Meanwhile, most of the wireless world has adopted a competing technology standard, Long Term Evolution (LTE). This will make any combination with another wireless player more difficult because the network synergies will be missing.
Another head-scratcher has been Sprint's all-you-can-eat data plan, which allows customers to gobble as much bandwidth as they like for one monthly rate. Meanwhile, AT&T offers tiered-pricing plans for data and Verizon is expected to soon follow suit. With bandwidth such a precious commodity in wireless, it makes no economic sense to essentially give it way.
For all the reasons cited above, Dan Hesse's urgent pleas for undoing the AT&T-T-Mobile deal should fall on deaf ears. Hesse and his predecessors at Sprint are to blame for the company's precipitous decline. Worrying about a deal that has not even been finalized would seem to be a waste of time, given all Sprint's issues that require management's immediate attention.
Hesse would be advised to quit playing the role of the rejected bride. Instead, he should figure out how to put some lipstick on his mistake-prone pig of a company in hopes of attracting a wireless marriage proposal.
Sprint CEO Dan Hesse took out his frustrations on AT&T, claiming the consolidation would give the merged firms too much economic power in the mobile market. "I have concerns it would stifle innovation," Hesse whined in a speech.
Most observers think Hesse doth protest too much. Sprint would like nothing better than to arrange for a corporate marriage that would increase its market share. In fact, the word on the street is that Sprint did more than just flirt with T-Mobile, hoping to land a deal of its own.
When Sprint's overtures were rejected, Hesse began acting like the jilted lover, stamping his feet in disapproval of the AT&T and T-Mobile marriage. Apparently, his failure to negotiate a deal for Sprint precludes other wireless firms from acting in their self-interests.
Perhaps, Hesse should spend less time appearing in Sprint's snooze-inducing television commercials and more attention fixing his firm's performance. The Overland Park, Kansas, based wireless company carded a stunning $595 million operating loss last year as it struggled to increase its market share.
Most of the company's growth in 2010 was prepay customers, less lucrative than post-paid subscribers on monthly rate plans. At the end of the year, Sprint had 49.9 million wireless subscribers, of which 12.3 million were pre-pay customers, according to the company. That means these bottom feeders represent nearly one-quarter of the company's subscriber base.
Unfortunately, Sprint's cost structure is hamstrung because it operates two incompatible wireless networks. This is a legacy of its ill advised 2005 purchase of Nextel, which operated a walkie-talkie mobile network. To call the $6.5 billion merger a failure would be too kind. It was an unmitigated disaster.
Sprint overpaid for a technology that was being fast becoming obsolete by the emergence of feature rich phones. At the time of the merger, Nextel was the third largest wireless company and Sprint was a solid fourth. Six years after the merger, Sprint is mired in third place, stuck between giants AT&T and Verizon and a host of bit players at the low end.
Unfortunately, Sprint has learned nothing from its past corporate pratfalls. The company is pursuing WiMax as its technology choice on its speedier 4G network in an uneasy partnership with Clearwire. Meanwhile, most of the wireless world has adopted a competing technology standard, Long Term Evolution (LTE). This will make any combination with another wireless player more difficult because the network synergies will be missing.
Another head-scratcher has been Sprint's all-you-can-eat data plan, which allows customers to gobble as much bandwidth as they like for one monthly rate. Meanwhile, AT&T offers tiered-pricing plans for data and Verizon is expected to soon follow suit. With bandwidth such a precious commodity in wireless, it makes no economic sense to essentially give it way.
For all the reasons cited above, Dan Hesse's urgent pleas for undoing the AT&T-T-Mobile deal should fall on deaf ears. Hesse and his predecessors at Sprint are to blame for the company's precipitous decline. Worrying about a deal that has not even been finalized would seem to be a waste of time, given all Sprint's issues that require management's immediate attention.
Hesse would be advised to quit playing the role of the rejected bride. Instead, he should figure out how to put some lipstick on his mistake-prone pig of a company in hopes of attracting a wireless marriage proposal.
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