Awful Return on Q-C Investment

On Sunday, The Dispatch/Argus ran a laudatory front-page article: "Q-C Cashes in." The lead to that article crows. "Stimulus put $164M into area." With that "$164M in spending, 191 jobs were created or retained" in the 17th Congressional District.

That means each of those jobs cost the American taxpayers $858,639! It looks to me, like you and I just got fleeced.

To help you make up your own mind, here are some figures.

-- There are about 310 million Americans.

-- As of 2010, the population of the Quad-Cities metropolitan area was 379,690.

-- Therefore, one of every 810 Americans live in Q-C Metro area.

In 2009, Congress (then controlled by the Democrats) passed at President Obama's request the $840 billion American Recovery and Reinvestment Act, commonly referred to as the ARRA, or as the Obama Stimulus Act.

So, if one out of every 810 Americans lives in the Q-C Metro area, and if the Q-C Metro area had received its proportionate share of stimulus funds -- one out of every 810 stimulus dollars -- we should have received $1,037,038,037. Instead we got a lousy $164,000,000! What happened to our other $873,000,000?

Again, if there are 380,000 people in the metro area, and if we received $164 million ARRA funds, we each got an average of $431. I don't recall getting my $431. Do you recall getting yours? Or did Washington decide somebody needed the money more than you or I did?

Of course, there is good news, as well as bad news. Washington didn't tax us to raise the $840 billion in ARRA funds.

Had Washington taxed all 310 million Americans equally, every American would have seen a new tax bill for $2,710. That's the good news! The bad news is that Washington borrowed the $840 billion, instead. So every American -- man, woman and child -- now owes an additional $2,710.

So the bottom line is this: for a $431 Washington handout that you and I didn't get, we each have been left with a bill for $2,710 -- which we did get!

So who got the $164 million? Those lucky people who the brilliant bureaucrats in Washington decided were worthier in all likelihood, than you or I.

Isn't "income redistribution" wonderful? The likelihood is that you didn't get a penny of stimulus money. And for that you -- and every member of your family -- each have been left with a debt of $2,710!

Of course, there are the "fortunate few" who Washington has deigned to enrich.

The owners of dilapidated Illinois Oil Co. building in Rock Island, and the Washington Square Apartments in Moline (or their successors in interest) have to be dancing in the streets. It's a wonderful thing to have your neighbors renovate your building at their expense. Those of us who have maintained our properties, it seems, have made a disqualifying mistake, for which we deserve to be punished -- by having our income redistributed.

So if these renovations are such "great investments," why weren't they undertaken by private sector investors with private funds? Or are the guys in Washington who gave us Solyndra the only ones smart enough to recognize a "great investment?"

My mother used to say "God helps those who help themselves."

Washington calls that old-fashioned, and says, "We'll help those that don't -- with your money!"
John Donald O'Shea of Moline is a retired circuit court judge.


Posted Online: Sept. 21, 2011, 3:10 pm - Quad-Cities Online

by John Donald O'Shea

Copyright 2011, John Donald O'Shea

Treasury's Savingsman: U.S. Should Take Own Advice

The greatest lessons about saving money hit us when we're kids, especially from nursery rhymes, like Simple Simon, who never had money.


Always spending, never saving.

Then there was the Old Lady who had to live in a shoe because she relied totally on Social Security. And of course Humpty Dumpty would have fared much better had he put aside a little cash for his long term health care.

Hey, good lessons to remember. Saving for your financial future is no fairy tale, because if you don't have a goose that lays the golden eggs, you better "Choose to Save."

While driving recently, I heard a public service announcement (PSA) from the U.S. Treasury, which seems to fit very well with what I had planned to say in this op-ed. When I went to the Internet to try to find the text, I found that it was one of the Treasury's "Choose to Save Public Service Announcements." (http://www.choosetosave.org/psaplayer/index.html)

What particularly struck me about the ad was that it was 100 percent out of phase with the insanely irresponsible deficit spending coming from Washington. It gave me at least an iota of hope that somebody in Washington understands that buying-on-time ("deficit spending") is incompatible with saving for a secure future. Indeed, the PSAs on the site sounded a lot like my father and mother.

The Great Depression taught my parents a number of lessons that they practiced for the rest of their lives, and taught their boys.

On many occasions, my dad said that the cause of the stock market crash was the "buying of stocks on margin." Before "Black Friday," a person could buy a stock by putting 10 percent "down," and owing the rest. It was a way of buying stock "on time."

People who bought on 10 percent margin, made fortunes — as long as stock prices rose, and as long as they were able to sell at the appreciated prices! But when the market precipitously dropped on Black Friday, and when margin calls went out for the other 90 percent, few people could come up with it. Those that couldn't, lost the 10 percent they had put "down," and found themselves liable for the other 90 percent.

From their Depression experiences, dad and mom formulated rules designed to allow them to survive next depression.

Rule No.1: Never buy on time.

Rule No. 2: If you can't pay cash for it, don't buy it! Wait until you can pay cash.

Rule No. 3: Never pay interest. If you have to spend money paying interest, you will have that much less money to spend on things you really want.

Dad and mom made one exception to their rule. When they bought a house after World War II, they took out a mortgage.

They made a judgment that they could, on dad's income, afford to pay that mortgage. But to protect themselves as far as possible, Dad bought mortgage insurance to insure the house would be paid for in the event of his death.

For all other purchases, including automobiles, my parents saved and paid cash.

Mom was proud to tell how she bought their first radio with pennies she had saved. Dad, being a businessman, understood that business expansions generally required borrowing. But borrowing, even for that, was never dad's first option.

He frequently said, "there are two ways to make money: earn more, or spend less.

Mom and dad both believed in "putting something away for a rainy day."

Having survived the Depression, mom and dad always operated on the theory that they wanted things to be better for their boys. They never would have asked us to pay for their home, their car or even their medical expenses.

Throughout my life, I have followed their advice. I have always found paying cash for something makes you think twice before you buy it. To this day, I always ask myself if I want it badly enough to deplete my savings. It is amazing how many "things" I haven't bought over the years because I felt that I would be better off not depleting my savings.

These are old-fashioned notions. I suppose that at least half the people in the country would reject them as antiquated. They follow a modern precept: "If you want it, buy it and pay for it later." The treasury seems to disagree:

Announcer. And now, another adventure with Savingsman!

Attractive Young Woman. (Shopping) Oh dear! I can't afford that!

Evil Credit Card Guy. Charge it! You can pay it off later

Savingsman. Not so fast Credit Card Guy.

Attractive Young Woman. Savingsman!

Savingsman. Don't let him entice you ma'am, Credit Card Guy can lead you to big trouble ... you need a savings plan!

Attractive Young Woman. You're right Savingsman!

Savingsman. Get this Ballpark Estimate worksheet at choosetosave.org. It will help you get started!

Attractive Young Woman. Gee, thanks Savingsman!


Posted Online: Sept. 13, 2011, 3:00 pm - Quad-Cities Online

by John Donald O'Shea

Copyright 2011, John Donald O'Shea

Constitution Is a Flexible, Living Document -- Within Limits!

The Constitution gives Congress explicit power to regulate commerce among the states. Every baby born in America will eventually use public transportation and the interstate highway system. Population increases require greater congressional expenditures to build and maintain those systems.

So to prevent increases in the population with the attendant costs to the public, would Vice President Joe Biden (recall his recent China trip) say that Congress has power to regulate commerce among the states to limit the number of children a family might be allowed to have to one or two? To require the use of contraception or abstinence?

When the Constitution was adopted, the governments of the several sovereign states were not abolished. But the very people who set up the states, decided that states were good at some things, and not very good at others. Those powers the states possessed, but were not very good at exercising, were taken away and vested in the new federal government.

The powers vested in Congress are generally known as "enumerated powers" because they are "enumerated" in Article I. That article has not been amended since the date it was adopted. The 18 enumerated powers include:

-- Power to lay and collect taxes ... to pay the debts and provide for the common defense and general welfare of the U.S.

-- To borrow money on the credit of the U. S.

-- To regulate commerce with foreign nations, and among the several states.

-- To establish a uniform rule of naturalization.

-- To coin money, and regulate the value thereof.

-- To establish post offices and post roads.

-- To punish piracies and felonies on the high seas.

-- To declare war.

-- To raise armies.

-- To provide and maintain a navy.

-- To make all laws which shall be necessary and proper for carrying into executing the foregoing powers.

There is no grant of power to Congress to establish a religion, regulate speech, or abolish the right to bear arms. But what if Congress, having enumerated powers, expanded them under the theory that the Constitution was a non-rigid, flexible, dynamic, living document, and under the theory that such an expansion was "necessary and proper" for carrying into execution one of its 17 other enumerated powers? What if Congress decided that pursuant to the power granted to it to "lay and collect taxes to provide for the general welfare," that it was "necessary and proper" that it should subsidize the Catholic faith over the Jewish faith?

What if Congress decided that the holy days of the disparate religions were burdening interstate commerce, and that it should establish one religion under its power to regulate commerce so as to remove the time lost by disparate holy days?

To make sure that sort of thing didn't happen, 10 Amendments, known as the Bill of Rights, were added to the Constitution in 1791.

The Bill of Rights was passed because the American people were afraid that even though Congress had only been given certain enumerated powers that, left to its own devices, it would, like every other government, seek to expand those powers in the name of necessity. The First Amendment contains an unequivocal statement that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof, or abridging freedom of speech or the press." The Second provides that "the right of the people to keep and bear Arms, shall not be infringed."

Most Americans are aware of at least some of the amendments. But few seem to be aware of the 10th.

"The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."

Nowhere is Congress given the power to say what marriage is, or what a state may prohibit as constituting, murder, burglary, or theft.

Nowhere is Congress given power to say whether a man and his wife my opt to use a contraceptive. As the states clearly had power to define marriage, and punish criminal offenses before the Constitution was enacted, and since no such power was delegated to Congress, these are powers "reserved to the states." And a married couples choice to employ or not to employ a contraceptive is similarly a question "reserved" either to the "states" or the "people." As a further guarantee, the 9th Amendment provides, "The enumeration in this Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people."

That means, the fact that Constitution expressly says that a man has a right to trial by jury does not mean that he does not also "retain" the right to share a contraceptive with his wife.

The Preamble states that a goal of the new Constitution was to "promote the general welfare." But if Congress can pass any law that it deems "promotes the general welfare," why bother to enumerate 18 specific powers? They become surplusage. And the Bill of Rights becomes a nullity.

Conservatives do not deny the Constitution is a dynamic, living document. But they believe it must be construed as the founding fathers intended it to be construed -- with the states and people exercising the "reserved powers" and with Congress exercising only those powers specifically granted to it by the Constitution -- which the people of the states decided could better be exercised by a federal government!

So, when you authorize the painter to paint your living room, is it also "necessary and proper," or for your "general welfare" for him to paint your car?


Posted Online: Sept. 07, 2011, 2:23 pm - Quad-Cities Online

by John Donald O'Shea

Copyright 2011, John Donald O'Shea