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Wednesday, April 18, 2012

Dirty Politics Sinks Keystone and Benefits Buffet and Nebraska Senator Nelson

Previously we have written on the  Keystone Pipeline and wondered if there was a benefit for Warren Buffet and his company Berkshire Hathaway.  Glenn Beck goes further into the details in the following posting.

If you want to see what we wrote on Thursday January 26, 2012 a posting entitled "Buffet Profits At The Obama Trough." You can look it up on the site or Google "keystone pipeline conservative musings buffet" It should be found that way.

Regardless, all Buffet's moves seem to be pure politics. Whether it is the "Buffet Rule" or the Keystone pipeline cancellation, it all goes together.  We are very disappointed with Mr. Buffet and we wonder how much of his wealth was actually obtained by political connections rather than smarts.  

Additionally, with his apparent reticence to appoint a successor, one can only wonder what dirty laundry that a competent businessman/woman might uncover. He might be hiding some very bad stuff which would make his hesitancy for anyone to look over his shoulder understandable. 

We have learned from experts that if you have an employee who is stealing or doing something illegal, that person will be the one who does not take vacation, comes in when they are deathly ill and never wants anyone to do their work. Someone like that should set off alarm bells. Is that the reason for Buffet not naming a successor?  One can only wonder.

Buffet has always been proclaimed as a brilliant businessman who has been able to find value where others didn't see it. So why did he name his unsophisticated farmer son to the successor chairman of the company?  Why has he not named someone to take over for him? He is not a youngster and now with his diagnosis of prostate cancer, pressure will mount for him to name that person to take over for him. If he finally names someone and that person is not conversant in complex financial matters, we will have to assume that he is hiding some bad stuff. Could he be the next Madoff?

What do you think?  Let us know and if you disagree, we want to know that also.

Conservative Tom

This is a special report done in conjunction with GBTV. The issue was explored in detail on The Glenn Beck Program Tuesday, April 17. 
Did Nebraska Sen. Ben Nelson and Warren Buffett Help Obama Kill Keystone Pipeline to Benefit Burlington Northern Railroad?As the nation’s gas prices skyrocket, critics argue that President Obama’s recent rejection of the $7 billion, “shovel-ready” Keystone XL oil pipeline, followed by his continued vow to “double down” on green energy, is a clear sign the administration plans to do little of substance in terms of American oil exploration. The move has also stirred controversy about the president’s real intentions concerning job creation and reducing pain at the pump for everyday Americans. But could there be a more sinister reason behind denying the pipeline’s requisite permits — namely, to benefit billionaire Obama-supporter Warren Buffett?
The evidence does seem to be mounting.
Background on TransCanada’s Keystone XL oil pipeline 
By now, most are likely familiar with the controversy surrounding the Keystone XL oil pipeline intended to transport crude oil from Alberta, Canada all the way to Texas’ Gulf Coast. The administration rejected permits to construct the northern portion of the pipeline, allegedly on the basis of “environmental concerns,” along with a purported lack of time to investigate said issues.
Adding salt to the wound, in March, Obama visited Cushing, Oklahoma, site of the world’s largest oil storage complex, to take credit for “approving” the stretch of pipeline construction that was already underway there. While Obama used the tour to prop up his administrations’ energy policy, TransCanada actually gained approvals to build the southern stretch of its pipeline months prior to Obama’s arrival in Oklahoma, and did so through no help of the president. As Forbes pointed out, pipelines that stay within U.S. borders are not subject to presidential approval like ones running from Canada into the U.S.
Regarding the northern portion, TransCanada filed an initial application to build the 1,179-mile underground pipeline in 2008, passing two State Department reviews and in February 2010, South Dakota Public Utilities Commission (PUC) granted a permit based on a thorough work up of the project.
“There has been a great deal of work and due diligence leading up to this decision,” said South DakotaDid Nebraska Sen. Ben Nelson and Warren Buffett Help Obama Kill Keystone Pipeline to Benefit Burlington Northern Railroad? Public Utilities Commissioner Dustin Johnson in an interview with DownStreamToday. “The record compiled in this case is pretty impressive. In the end, I feel the conditions we have placed upon this project ensure that it will be constructed in a manner that is sensitive to South Dakota and her people.”
Another Public Utilities official said he believed “the process by which this application was considered was open, thorough and fair” and Keystone openly pledged to station full-time personnel in South Dakota to respond to any emergency situations that may have arisen, according to the report.
That was apparently not enough for the White House, however, which sent TransCanada and others back to the drawing board in January 2012, citing environmental concerns.
To bypass obstacles created by special interest groups and the Environmental Protection Agency, a March 2012 amendment was introduced in the Senate that would have eliminated the need for a federal permit, while addressing environmentalists’ worries by placing more autonomy in Nebraska’s hands. After a vote, however, Democrats squashed the measure 56 to 42.
But it appears TransCanada may not be giving up just yet. According to its website, the company plans to re-apply for a Presidential Permit to be processed in an “expedited manner” by making use of ”the exhaustive record compiled over the past three plus years of regulatory review to allow for an in-service date of 2015.”
The statement continues:
TransCanada anticipates approval of the Presidential Permit application – which is required as the pipeline will cross the Canada/U.S. border – in the first quarter of 2013, after which construction will quickly begin. [...]  TransCanada continues to believe in the value of Keystone XL due to the overwhelming support the project has received from American and Canadian producers and U.S. refiners who signed 17 to 18 year contracts to ship over hundreds of thousands of barrels of oil per day to meet the needs of American consumers.
Given the obstacles faced to now, TransCanada still may have a long road to hoe.
The job factor
If allowed, Keystone would have brought a reported 830,000 barrels of crude oil per day from Alberta, Canada, to U.S. outposts and refineries on the Gulf Coast. According to TransCanada, the $7 billion project would have also created some 20,000 jobs in the United States.
“These are new, real U.S. jobs,” Russ Girling, TransCanada’s president and chief executive officer, said in a statement back in January.
Girling clarified that 13,000 construction jobs would be created immediately while another 7,000 would be generated in the manufacturing sector.
TransCanada also maintained that among those positions on offer would be one for an “environmental coordinator.” While the job description was not readily available, it seems based on the title, to be the kind of “green job” engineered to oversee that the pipeline’s production was in accordance with environmental standards.
A growing rift with Canada? 
TransCanada and its supporters, including Canadian Prime Minister Stephen Harper, have maintained that Keystone XL is vital to American livelihood. Yet, as The Blaze reported, in the wake of Obama’s political maneuvering, Harper deemed the U.S. an unreliable energy partner and now plans to expand his country’s crude export. The move will result in Canada eliminating the discount it once afforded the U.S. on its oil products, thus hitting drivers at the gas pump even harder.
Even longtime oilman T. Boone Pickens observed the alienation occurring between the two neighbors when he said that ”we work with the Canadians like they’re the enemy sometimes.” He added, “we tell them they can’t bring a Keystone pipeline to the United States…That’s 250 billion barrels of oil that the United States would capture for our use!”
The administration’s alleged reason for rejecting the application for the pipeline submitted by Calgary-based TransCanada was said to be based on a lack of time to study the proposal by a February 21 Congressional deadline. Yet, as we have pointed out, the pipeline was under review for no less than three years and was approved earlier. In addition, if environmental concerns were truly the catalyst for rejecting the pipeline, why then would the president seem comfortable with operating pollutant-emitting freight trains along thousands of miles of railroad through the United States? 
Warren Buffett’s Burlington Northern Railroad 
Did Nebraska Sen. Ben Nelson and Warren Buffett Help Obama Kill Keystone Pipeline to Benefit Burlington Northern Railroad?What prompted the president to turn the lights out on what critics argue would have been an environmentally-sound, job-boosting, oil-producing project that would benefit the nation and preserve the financially beneficial Canadian-U.S. oil relationship? What does President Obama have to gain by rejecting Keystone XL and who else stands to benefit from his decision?
It was previously reported on The Blaze that Warren Buffett’s Burlington Northern Santa Fe LLC railroad — a unit of Buffett’s Omaha, Nebraska based Berkshire Hathaway — would be among those poised to reap sizable gains by the administration’s decision to reject TransCanada’s oil pipeline permit. Berkshire Hathaway purchased a 22% (or, $34 billion) share of the 32,000 mile line in 2009, shortly after Obama was elected.
“Whatever people bring to us, we’re ready to haul,” Krista York-Wooley, a spokeswoman for Burlington Northern told Bloomberg. If Keystone XL “doesn’t happen, we’re here to haul.”
According to the analysis, the rail option, while more expensive, would minimize environmental impact. At the same time, however, it would also worsen greenhouse gas emissions.
Below, Glenn Beck delved into the Keystone pipeline and Buffett’s railroad.
Nebraska Senator Ben Nelson
When it comes to the Keystone oil pipeline and Buffett’s Burlington Northern, all roads seem to lead to Nebraska.
GBTV uncovered a startling connection between Berkshire Hathaway’s home-state and that state’s senator, Ben Nelson, who voted against the Keystone XL and lobbied that it be re-routed to avoid Nebraska. Ironically, the Democrat’s attempts to thwart the pipeline were done while he himself maintained his state would heartily welcome the jobs created from the Keystone project. While Nelson’s position then seems counterintuitive, add to it the fact that he is heavily invested in Buffett’s Berkshire Hathaway. From 2007 to 2012 Nelson contributed $27,000 to the company itself and according to a recent financial disclosure statement from 2008, he owned between $1.5 and $6 million of the company’s stock – his largest investment in any one company to date.
Did Nebraska Sen. Ben Nelson and Warren Buffett Help Obama Kill Keystone Pipeline to Benefit Burlington Northern Railroad?The pendulum seems to swing both ways, however. Buffett’s Burlington Northern Santa Fe PAC in turn contributed $5,000 to Senator Nelson’s Nebraska Leadership PAC and Berkshire Hathaway employees have reportedly long supported the senator, contributing at least $75,550 to the Nebraska Democrat over the course of his political career according to the Center for Responsive Politics.

Not coincidentally, the Nebraska senator penned an op-ed column on March 5, 2012 entitled “Behind Those High Gas Prices.” As you can imagine, he was quick to tell Nebraskans that the spike “has nothing to do with the Keystone Pipeline” and also “isn’t a result of domestic oil production.” Below is an excerpt from Nelson’s column:
First, the rapid rise isn’t a result of domestic oil production. We’re producing more oil in the U.S. now than we have since 2003. As a matter of fact, under the previous Administration domestic production of crude declined every year, whereas since 2009 domestic production has increased every year.
Second, this has nothing to do with the Keystone Pipeline. The price of oil is set on the World Market and is impacted by a host of factors – including unrest in oil producing nations. It isn’t a simple supply and demand pricing issue.
He went on to write the U.S. has in fact demonstrated “the lowest demand for gasoline in 15 years” but the price of oil “has still gone up.”
Helping to squash the Keystone pipeline clearly won’t help matters either.
Overhauling financial regulation
Another noteworthy incident unearthed by GBTV was in Nelson’s involvement in overhauling financial regulation. Among the considerations during a tentative deal to set restrictions on trading derivatives, was a substantial provision being lobbied for by Buffett that would have buffered his company from financial blows. The WSJ adds:
The provision, sought by Berkshire and pushed by Nebraska Sen. Ben Nelson in the Senate Agriculture Committee, would largely exempt existing derivatives contracts from the proposed rules. Previously, the legislation could have allowed regulators to require that companies such as Nebraska-based Berkshire put aside large sums to cover potential losses.
The article adds that the change “thus would aid Berkshire, which has a $63 billion derivatives portfolio, according to Barclays Capital.”
As GBTV discovered, Nelson has also engaged in a series of votes, including in favor of TARPfunds, that have benefited Buffett in some way.
Below, Beck explains Senator Nelson’s involvement.
A lucrative proposition
By removing the possibility of transporting oil via the Keystone pipeline, the Burlington Northern railroad has, some might argue, “conveniently” been able to fill the void, thus Senator Nelson and Berkshire Hathaway stand to reap substantial dividends. Likewise, Buffett ensured financial security and prosperity for his new railroad and will likely pay his Democratic benefactors in kind.

Can Our Government Pass Its Test?

We would like to know what you think and are posing this question.  Can the US government make the necessary cuts in spending to avoid a shut down of its services in December?  Another way of stating this is, will Congress and the President have the guts to make the tough decisions that will a) get the budget under control b) stop the ever-increasing debt c) cut inferior programs and policies that are no longer effective?
In other words, will Congress do its job?  

We doubt it and expect there will be a lot of grandstanding and chest beating with very little progress. These bums will not act until there is an absolute crisis and at that point in December, it won't be an emergency.

Additionally, if the Democrats win big this fall, there will be little movement as they will read the results as a condemnation of Republican actions in the House to cut spending and will want to wait until January to make their "necessary" tax increases. If the Republicans win, they will delay everything until the new Congress is seated to make changes to their way of thinking. 

So for these reasons, we doubt anything will occur in December.  What do you think?  We want to hear from you.

Conservative Tom

U.S. faces big tax, budget test at year end: Geithner

Fantasy Finance
WASHINGTON (Reuters) - The government will face a major test on whether it has the capacity to govern when it faces big tax and budget decisions at the end of the year, U.S. Treasury Secretary Timothy Geithner said on Wednesday.
Before 2013, the country will be forced to deal with the expiration of tax cuts that affect nearly all taxpayers, automatic budget cuts, as well as another debate over raising the country's debt limit.
"It will be a big test in Washington, a big test of the country to govern itself in how Washington deals with those challenges," Geithner said ahead of a meeting on Friday of finance ministers from the Group of 20, representing the world's leading industrialized and emerging market economies.
A protracted fight over how to rein in the country's trillion dollar plus deficits and raise the debt limit in 2011 forced the government to the brink of several shutdowns and stripped the country of its top credit rating.
The Treasury expects the country to hit the debt ceiling or the legal limit it is allowed to borrow before the end of the year and individual tax cuts enacted under former President George W. Bush - known as the Bush tax cuts - will expire December 31.
As well, $1.2 trillion in automatic budget cuts are set to kick in early January, which will force the Obama administration and Congress to deal with the country's fiscal problems.
"Hopefully we use it as an opportunity to make another significant step towards long term fiscal reform at that time," Geithner said.

Tuesday, April 17, 2012

All Government Is Free

Yes, of course all government is free, where have you been studying economics. All our money is the government's so it can do what it wants, right? If you have been paying any attention to the discussions in Washington, that seems to be the message.  All they need to do is spend a few trillions more dollars and all will be fine.  Unfortunately, that is far from reality.  Somehow millions become billions and then trillions.  Government never gets enough money, it always needs more.

Government is like the furnace that needs constant tending and fuel. It has an insatiable appetite and it never will be enough.

It is for that reason that we believe in a very small government, doing only those things that individuals cannot do for themselves or through organizations (charities)
that help provide for those temporary needs most people need sometime during their lives. Otherwise, government tries to be all things to all individuals which is an impossible task.

Examples of government inefficiency are  numerous but let us make a couple observations.  Those who work for all levels of government don't view the dollars as their own and therefore do not take care in shepherding them, rather they are careless, spendthrift and foolhardy with "some else's" money.  The recent million dollar Vegas party for the General Services Administration (GSA) (the government's bookkeeper and investigator) is a great example. Here is the organization that is supposed to make sure that the government is doing a good job spending our money and they irresponsibly spend significant dollars.  What a travesty. Heads should roll!

Additionally, have you ever seen a hard working government worker? Most come in at starting time, leave at their scheduled departure time and don't take work home.  Hey, they worked their 7 hours, what do you want?  If you want a good example of this attitude, go to your local court.  A case might be called for 8:30 and the Judge shows up at 9, if you are lucky. However, they might not show until 10 or 11.   If you doubt our statement, ask a lawyer who has to appear before one of these "Lords of the Manor."

Finally, the saying "close enough for government work" is really a true statement.  How many people are removed from Welfare rolls by the state? How many people have died and Social Security continues to pay for years in the future?  Recently, in Michigan, a woman won a $1 million lottery.  She took the money and continued to receive Welfare. Only after someone turned her into the news media did the agency decide to take it away. She now is being charged with Welfare fraud.  Had someone not acted, she would have continued to take the money--"because she deserved it and had bills to pay."  Where were the state workers who should have checked the list of lottery winners and compared that with recipients  of the largess of the state? Probably on lunch break.

We need to cut government (federal, state and local) employees (sans military) by one-half to two-thirds. We doubt that it will impact any services we receive.

Conservative Tom

Free Lunch Egalitarianism

Here we go again.
At the beginning of his presidency, Barack Obama argued that the country’s spiraling debt was largely the result of exploding health-care costs. That was true. He then said the cure for these exploding costs would be his health-care reform. That was not true.
It was obvious at the time that it could never be true. If government gives health insurance to 33 million uninsured, that costs. Costs a lot. There’s no free lunch.
Now we know. The Congressional Budget Office’s latest estimate is that Obamacare will add $1.76 trillion in federal expenditures through 2022. And, as one of the Medicare trustees has just made clear, if you don’t double count the $575 billion set aside for the Medicare trust fund, Obamacare adds to the already crushing national debt.
Three years later, we are back to smoke and mirrors. This time it’s not health care but the Buffett Rule, which would impose a minimum 30 percent effective tax rate on millionaires. Here is how Obama introduced it last September:
“Warren Buffett’s secretary shouldn’t pay a [higher] tax rate than Warren Buffett. … And that basic principle of fairness, if applied to our tax code, could raise enough money” to “stabilize our debt and deficits for the next decade. … This is not politics; this is math.”
OK. Let’s do the math. The Joint Committee on Taxation estimates this new tax would yield between $4 billion and $5 billion a year. If we collect the Buffett tax for the next 250 years — a span longer than the life of this republic — it would not cover the Obama deficitfor 2011 alone .
As an approach to our mountain of debt, the Buffett Rule is a farce. And yet Obama repeated the ridiculous claim again last week. “It will help us close our deficit.” Does he really think we’re that stupid?
Hence the fallback: The Buffett Rule is a first step in tax reform. On the contrary. It’s a substitute for tax reform, an evasion of tax reform. In three years, Obama hasn’t touched tax (or, for that matter, entitlement) reform, and clearly has no intention to. The Buffett Rule is nothing but a form of redistributionism that has vanishingly little to do with debt reduction and everything to do with re-election.
As such, it’s clever. It deftly channels the sentiment underlying Occupy Wall Street (original version, before its slovenly, whiny, aggressive weirdness made it politically toxic). It perfectly pits the 99 percent against the 1 percent. Indeed, it is OWS translated into legislation, something the actual occupiers never had the wit to come up with.
Buffett and Mitt Romney pay roughly 15 percent in taxes is that their income is principally capital gains. The Buffett Rule is, in fact, a disguised tax hike on capital gains. But Obama prefers to present it as just an alternative minimum tax because 50 years of economic history show that raising the capital gains tax backfires: It reduces federal revenues, while lowering the tax raises revenues.
No matter. Obama had famously said in 2008 that even if that’s the case, he’d still raise the capital gains tax — for the sake of fairness.
For Obama, fairness is the supreme social value. And fairness is what he is running on — although he is not prepared to come clean on its price. Or even acknowledge that there is a price. Instead, Obama throws in a free economic lunch for all. “This is not just about fairness,” he insisted on Wednesday. “This is also about growth.”
Growth? The United States has the highest corporate tax rate in the industrialized world. Now, in the middle of a historically weak recovery, Obama wants to raise our capital gains tax to the fourth highest. No better way to discourage investment — and the jobs and growth that come with it.
Three years ago, Obama promised universal health care that saves money. Today, he offers a capital gains tax hike that spurs economic growth. This is free-lunch egalitarianism.
The Buffett Rule redistributes deck chairs on the Titanic, ostensibly to make more available for those in steerage. Nice idea, but the iceberg cometh. The enterprise is an exercise in misdirection — a distraction not just from Obama’s dismal record on growth and unemployment but, more importantly, from his dereliction of duty in failing to this day to address the utterly predictable and devastating debt crisis ahead.

Would/Should Israel Take Sinai Back?

The answer is yes.  Israel should consider taking back Sinai as a buffer against a Muslim Brotherhood run Egypt. Will it is another question.  There will be some who think that it will send a negative message to the Arab Street (Obama and J Street) and then there others, like us, who think it makes good sense and that Israel MUST act in its best interests. Having the Sinai as a controlled space is a safe military option.

Where will the Israeli leaders end up on this topic, who knows. However, it is well worth considering and in light of the apparent domination of Egyptian politics by the Muslim Brotherhood, makes considerable sense.

What do you think?

Conservative Tom

Egypt's Suleiman: Israel may consider occupying Sinai

Roi Kais - YNet News,  April 15th, 2012

Egyptian presidential candidate Omar Suleiman addressed the relations between Egypt and Israel for the first time since he announced his candidacy earlier this month.
In an interview with Egyptian daily al-Youm al-Saba'a, Suleiman analyzed relations between the two neighboring countries in the wake of the Arab Spring and the ongoing terrorist activity originating from the Sinai Peninsula. “I'm fearful of the price Egypt will have to pay if Israel decides to reoccupy Sinai,” he said.
He called on the Muslim Brotherhood party, which is considered his political rivals, “to exercise caution in an effort to keep peace in the region.”
“I fear that Israel thinks Egypt has become one of its enemies,” he said referring to the close relations between Hamas and the Muslim Brotherhood and the current situation in Sinai.
“Israel regards the Sinai Peninsula as an unsecure area, and is lead by the notion that Egyptian territory can be used for rocket launching. Therefore, Israel may consider returning to secure borders,” he added.
Suleiman with PM Netanyahu (Photo: GPO)
Asked whether he plans to reoccupy Sinai, Suleiman replied: “It's possible that Israel will confront us and use its national security as an excuse to do so. Israelis are experts at presenting such excuses to the world.”
He further said that he is fearful of misleading signals that could lead to unwanted confrontations. “If the Israelis reenter Sinai, they won't be quick to leave it again. Egypt could pay a heavy price if such an event occurred,” he said.

According to Suleiman, “Egypt should continue tightening its relationship with Hamas but not at the expense of the country's national interests, regional security and peace that will all enable Egypt to further develop internally.”

Suleiman, appointed deputy president by Mubarak in his last days in power, entered the presidential race at the last moment, triggering both concern and heavy criticism from reformists who see him as a symbol of Mubarak's rule and a danger to democracy.

Tens of thousands of Egyptians packed into Cairo's Tahrir Square on Friday to protest against Suleiman's run for the presidency. Muslim Brotherhood supporters waved banners depicting the presidential candidate as an agent of Israel.

Meanwhile, the body overseeing Egypt's presidential election recently disqualified 10 candidates from the race, including Suleiman.
According to election rules, disqualified candidates have 48 hours to appeal the decision. The final list of candidates will be announced on April 26.
Suleiman told Egyptian media sources that the commission did not fully disqualify him but had told him that he had not presented the proper number of endorsements. Each candidate needed at least 30,000 endorsements, including at least 1,000 from each of the country's 15 provinces, to join the race.
In response to his “temporary” disqualification, Suleiman pledged to press ahead with his campaign out of respect to his supporter