Greece, Hot Fudge Sundaes, Boehner/McConnell, and Junior-High Economics

hot fudge sundaeIn 1966 I was a junior high kid in small-town Montana when I got my first – and maybe most important – lesson in economics and personal finance.

That year was a whirlwind of change for me.  I had just left city life in the projects with my welfare mom to live with my dad, a hard-working small-business owner.  Everything was new – the small-town culture where people are accepting but demand responsibility; the freedom and fresh air walking through the woods and fishing in the beautiful mountain streams; the first exposure to the working world where one gets only what he earns; the little family luxuries like having clean clothes to wear and breakfast on the table every day.

But back to my economics lesson.

I didn’t know it at the time, but the crabby old guy who owned the local drug store was actually on a one-man mission to teach economic responsibility to the local youth.  Allen’s Drug Store featured an old-fashioned soda fountain, and old-man Allen served up a world-class hot fudge sundae:  whipped cream, nuts, and a cherry on top.  For a quarter!

Like most small-town kids at the time, I was doing odd jobs and making a buck here and there.   I also got an allowance of fifty cents per week, which seemed like a fortune to me.   A quarter for a hot fudge sundae at the drug store was well spent, and I had bought a few for cash before I learned from my older sister that Mr. Allen would actually let you “charge” the cost of a sundae, and you could pay him later.

I ran right down to Allen’s and ordered up my hot fudge sundae.  “Can I charge it?” I asked.  “Sure,” Mr. Allen said.  I felt like a big shot.

The next day I was back at the drug store, charging another sundae.  It just doesn’t get better than this!  And within another day or so I was back again.  And again.

One day Mr. Allen went to his little box of index cards, picked out mine, and saw that I owed him for a half-dozen sundaes.  “I’m afraid this is the last one, until you pay your bill,” he said.  I was a little bit ticked off, because I had already spent all my money on Mad magazines, baseball cards, and other important stuff.  But then I started thinking about the whole “charge account” thing, and it started to make sense.  Mr. Allen couldn’t just give me free sundaes forever.  And I couldn’t eat sundaes every day when I was only bringing in fifty cents a week.

So I went without sundaes for a while and saved enough money to pay my bill.  My sundae consumption went way down.  I found that they actually tasted a lot better on the rare occasion when I decided to buy one – for cash.

Thanks for the lesson, Mr. Allen.

Today the nation of Greece defaulted on its IMF loans.  Banks put limits on withdrawals.  Stock markets tumbled worldwide.  It’s not that Greece’s economic collapse is, on its own, that big a deal – their GDP is only about equal to that of Louisiana.  What really scares thoughtful people is that other European nations – and the United States, the world’s largest economy – are following the same path as the Greeks.

Even junior high kids can understand that spending more than one earns is a recipe for disaster.  Our Federal Reserve, and the European central banks, held interest rates to zero for many years so that our governments could borrow and spend (pandering for votes) to the point that repayment of the debt is metaphysically impossible.  In addition to the federal insolvency, local and state governments have promised pensions and benefits to their employees (again, pandering for votes and union support) that citizens will never be able to afford.

It is embarrassingly simple.   If we don’t elect conservative officials with at least junior-high level economic skills, and if we don’t allow them to restrict government growth and spending, there will be no more hot fudge sundaes.  Try telling that to your grandkids.

Boehner and McConnell have to go.  So do the many representatives whose sole interest is holding on to their positions and power. Our only hope is to support and grow the Freedom Caucus, Congress’ conservative wing and the only antidote to the liberal Republican leadership.  And we must elect a president who understands economic reality.  At least at the junior-high level.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side

Got to pay your dues
If you wanna sing the blues,
And you know it don’t come easy!

It Don’t Come Easy – Ringo Starr


A fun little romp with George and Ringo!

Pro Athletes, Show Some Respect!

Photo Credit: Kyle Terada-USA TODAY Sports

Photo Credit: Kyle Terada-USA TODAY Sports

I’m a big sports fan.  And a big patriot.

I know not everybody thinks it is necessary, or even appropriate, to ask thousands of fans to stand and honor the flag and our nation before a sporting event.  I have mixed emotions about it myself.   A while back I asked why US sports venues so frequently play the Canadian national anthem before an event in our country, yet you will never hear the Star Spangled Banner before a CFL (Canadian Football League) game even though many of the players (all of the best ones) are from the United States.

This week the Golden State Warriors beat the Cleveland Cavaliers in the NBA championship series.  Before each game – like every professional sports event in the United States –  there was the singing of our national anthem.  I really enjoyed this year’s NBA Finals anthem presentations.  Carlos Santana played a beautiful rendition on his PRS guitar, albeit patiently condoning his wife’s pathetic attempt to accompany him on drums. The two Metallica guitarists shredded a heavy-metal version of the SSB and it was surprisingly authentic, rich, patriotic and satisfying. Marlana VanHoose, a blind and palsied 19-year old singer captivated the audience with her powerful rendition of the national anthem.

Still, I am disappointed every time I attend or watch an NBA game when most of the players look down at their shoes, showing either indifference, disrespect, or perhaps contempt for the flag, our anthem, and the nation that made each of them fabulously wealthy.  Who knows what the motivation is – they may be making a political statement, or they may just be getting focused on the game ahead.  Regardless, would it be so hard to at least look up at the flag?

The photo above is a typical NBA pre-game presentation.  My review of a different photograph taken before game 5 showed two of the twelve Golden State Warriors, David Lee and Draymond Green, standing at attention during the national anthem.  A third, James Michael McAdoo, who was brought up from the D-league and did not even get on the floor during the finals, actually placed his hand over his heart.  The other nine players stared at the floor and shuffled.

Here are the guaranteed contracts of these nine players:

  • Klay Thompson – $72 million
  • Andrew Bogut – $36 million
  • Andre Igoudala – $35 million
  • Stephen Curry – $34 million
  • Shaun Livingston – $14 million
  • Harrison Barnes – $7 million
  • Mareese Speights – $4 million
  • Festus Ezeli – $3 million
  • Leandro Barbosa – $1.5 million

Yes, I have mixed emotions about the coerced patriotism at every major league sporting event.  I question whether it is sincere patriotism or pandering.  Especially after learning that NFL teams, despite the outrageous money players and owners make, actually charged taxpayers millions of dollars for the “privilege” of having our service branches perform flag ceremonies before games.

The decision whether to present a patriotic moment before a game is, to my thinking, up to the home team and the league.  If they wish to do so, based on honest intentions, I’m good with that.  If not, I have no complaint.

The NBA has chosen to have a patriotic ceremony before each game.  And it seems to me that the nine employees listed above, and the hundreds or thousands of other professional athletes who earn millions of dollars playing a game they love in front of people who pay their salaries and pay for their arenas with tax dollars, could at least show a little respect to the country to whom they owe their success.

James Michael McAdoo, you didn’t even get to touch the game ball in the finals.  But I salute you, above and beyond all the other NBA Champion Golden State Warriors.  By showing respect to our country, you are more than just a Warrior – you are a Patriot.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side

Find out what it means to me!
Take care, TCB!

Respect – Aretha Franklin

A young and slender Aretha belts it out!

And here is my very own cover!

First Obama Phones – Now Obama Web

smartphonesThis week the FCC will review and perhaps vote on a proposal to expand the “Lifeline” telephone subsidy program to include entitlements for broadband internet services for the poor.

The Lifeline program was authorized by Congress with good intentions in 1985.   It provided subsidies for land-line telephone service to the poor, on the theory that a telephone is necessary to maintain basic health and safety.  The program, funded by federally mandated surcharges on consumer telephone bills, flew under the radar until 2005 when it was expanded to include cell phone service.  The subsequent rapid growth and explosion of fraud and abuse in the program drew considerable attention as free cell phones, derisively dubbed “Obama Phones”, were widely distributed – even unscrupulously collected and resold – with little qualification or oversight.

The program cost $1.4 billion in 2014.

To test the veracity of reports that virtually anybody could apply for and receive an “Obama Phone”, I filled out an online application (honestly) and hit “enter”.  Four days later I had a new cell phone, complete with 250 minutes of cellular service per month and unlimited texts.  It’s mine to use, apparently forever, no questions asked.  And I don’t think anybody would consider me the slightest bit “needy”.

In 2012, pushed by congressional oversight, the FCC attempted to assert some discipline in the program.  While costs were somewhat reduced, the rampant fraud continues, according to FCC commissioner Michael O’Rielly.  He wants to see the Lifeline program cleaned up before any consideration is given to expanding the entitlement.  O’Rielly would:

  • Set a budget for the Lifeline program – it currently has no limits on spending
  • Disallow any increase in the reimbursement rate paid to providers for adding broadband services
  • Limit the services covered under the program
  • Offer subsidies to only those who really need it – a survey indicated 19 out of 20 Lifeline users would have their own smart phones even if the program didn’t exist
  • Require participants to have “skin in the game” – no more completely free phones

Senator David Vitter (R-LA) wrote a scorching letter to FCC chairman Tom Wheeler, calling the program, “. . . one of the most abused and fraud-ridden federal programs ever.”  He excoriated Wheeler for denying the Office of the Inspector General the authority to investigate.

After decades of relative obscurity, the FCC, under Wheeler, is grabbing headlines with regularity this year.  Their new “Net Neutrality” rules took effect last week, making internet service providers regulated utilities like phone companies, and preventing them from charging higher rates to high volume customers.  Congress has vowed to undo the new provisions and might even cut the FCC’s budget.

Some view the FCC’s move to expand the Lifeline program as a natural and timely adjustment to rapid change in communication technology.  Others say it is just one more entitlement – payback and pay-forward for the political support of a growing segment of government-dependent voters.

This article can be seen in its entirety at Watchdog Arena.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side

I’m free to choose what I please any old time
I’m free to choose what I please any old time
So hold me, love me, love me, hold me
I’m free any old time to get what I want, yes I am

I’m Free – the Rolling Stones

Here’s a nice and kind of obscure tune by the Stones – enjoy!

I’ll Give Your Message to the Congressman. Click!

image by

image by

It’s another crazy day today in Washington, DC as the President, Congress, and lobbyists wrestle for votes on the very contentious TPA (Trade Promotion Authority) bill.  The phones on Capitol Hill ring off the hook, while servers at Twitter and Facebook whiz and whirr, disseminating the enormous traffic in political opinion.

Right now the prevailing wisdom among those who are “into” politics and want to have an impact on policy is that volume rules. We are encouraged to call our congressmen, tweet our opinions, write to our editors, and make our voices heard.  Volume means more.  And louder.

I guess the thinking is if a congressman gets 1000 phone calls today in support of a bill, and 800 calls in opposition, he or she will carefully tally the messages and vote accordingly.  If that were the case, we would not need congressmen – an app on our smart phones could just ring up everybody in the country and ask if want the TPA or not.  Add ’em up.

Communicating with our elected officials is a vitally important responsibility in a democratic republic.  They need to know the will of their constituents in order to represent us.  Ultimately, we ask that they use the information they receive and their best judgment to make decisions that benefit the nation as a whole.

Unfortunately, a massive barrage of phone calls and e-mails to their 18-year old aides on the day of a vote is not going to accomplish anything.  In fact, most congressional aides who man the phones are instructed to not divulge anything.  If you call your representative’s office to ask for his or her position on a bill, the odds are very strong that you will hear this:

“The Congressman has not taken a firm position on that issue yet.  He is evaluating input from his constituents. I will relay your message to the Congressman.”  Click.

There are a number of reasons for the use of this tactic.  One, the 18-year old aide has no clue what you are talking about.  Two, the Congressman may not want to commit to anything, because his vote might yet be bought at the last minute by the Speaker or a well-heeled lobbyist.  Okay, that’s pretty cynical, but it’s a bad old world out there.

The only practical way to have a genuine impact on policy is to have an ongoing working relationship with our elected officials. The time to make one’s wishes known is long before the day of the vote.  A polite and thoughtful letter early in the process will be more influential and appreciated than a last second telephone demand.  Our attendance and participation at a congressman’s town hall meeting is very effective, and then when we do write a letter or make a call about an urgent matter, it will carry much more weight if the congressman actually knows us and trusts our sincerity and authenticity.   If we voted for and financially supported the congressman, all the better.  Whether we agree on an issue or not, it is important that our relationship is businesslike and honest.

I don’t think “volume” is the key to good communication and influence.  Our congressmen are pulled in a thousand directions every day.  Everybody wants a piece of them and just a minute of their time. Some members are more accessible than others – thankfully, mine is exceptional in that regard.  Some are corrupt and we need to do whatever it takes to get them out of office.  But most are honest and sincere. They are human beings, after all, and they will respond more readily to people they know and respect.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side
Call me!
Don’t be afraid, you can call me!
Maybe it’s late, but just call me!
Tell me, and I’ll be around.

Call Me – Chris Montez

Girls sure used to dance funny!

USDA Food Stamp Program Benefits Yemen

photo courtesy

photo courtesy

About 25 years ago my wife and I were on a vacation trip in Hot Springs, Arkansas.  We had just got out of our car on a downtown street near the post office when a wild-eyed, shaggy-haired young guy ran up to us.  “Hey!” he yelled.  “You guys wanna buy some food stamps?  50 cents on the dollar!”

We were so caught off-guard, all we could say was, “No thanks.”  He ran off to the next stranger on the street – “Hey!  You wanna buy some food stamps . . . ”

After we figured out what had happened, we realized we should have called the police.  But we were a couple of naive middle-class Americans, who, like most, never had the time or inclination to figure out ways to commit fraud.  It honestly never crossed my mind that one could sell his taxpayer-funded benefits at a discount, receive cash, and spend it on whatever floats his boat more than groceries for the kids.

Even then, before EBT (Electronic Benefit Transfer) cards, the fraud was painfully easy.  Food stamps were printed on paper and they were as good as cash. I could have easily saved 50% on my next grocery shopping trip.  And the “needy” young guy on the street could have landed a weekend supply of Ludes and Mary Jane, compliments of the taxpayers.  Neither of those outcomes were the intention of LBJ, or the legislators who passed his Food Stamp Act in 1964 and upgraded it several times since, or the taxpayers who write checks to the IRS every year.  Little did we know that the food stamp fraud problem was going to get worse – much worse – over time.

We all exchange frustration about being in the grocery checkout line behind somebody with a cart full of extravagant fare, paid with an EBT card.  We are alarmed when we hear that SNAP (Supplemental Nutritional Assistance Program) will cost over $84 billion in 2015.  We wonder why schools plan to feed kids during the summer months, as well as throughout the school year, when their families already presumably receive food stamp benefits.

photo by Tameka Moore

photo by Tameka Moore

This week a Birmingham, Alabama task force raided twelve convenience stores and arrested 17 suspects involved in an alleged food stamp fraud ring.  The convenience store owners had been buying EBT cards from their customers at 50 cents on the dollar, and using the cards to buy merchandise for resale, including steaks at Wal-Mart.  Worse yet, some of the Muslim store owners were accepting EBT cards in exchange for cash payments to individuals in

Yemen.  This was no small operation, as officials identified hundreds of thousands of dollars in fraudulent transactions.  And authorities only have the resources to deal with a tiny tip of this huge Alabama iceberg.  Food stamp fraud cases like this show an accelerating trend all over the country.

While it is somewhat reassuring that some fraud cases are being prosecuted, it is disheartening to know that we are not even scratching the surface.  Citizens question why our government agencies aggressively promote benefit programs regardless of whether recipients are legal citizens or not.  There is inadequate prevention and policing of the rampant fraud by both consumers and providers.  Our border and immigration policies invite throngs of third-world indigents who hold little hope of becoming contributors to the economy and land here fully expecting benefits.

A group of clear-headed conservative Congressmen have lined up behind Rep. Matt Salmon (R-AZ) to introduce the ‘SNAP Verify Act of 2015′ in hopes of putting the brakes on the food stamp fraud program.  The law would require EBT users to present photo ID cards when making purchases.

Unfortunately, until Democrats and less-conservative Republicans recognize the scope of the problem, and put some teeth into enforcement, food stamp fraud will only get worse.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side

It’s a cheating situation,
A stealing invitation
To take what’s not really ours
To make it through the midnight hours

A Cheating Situation – Moe Bandy



Is the U.N. Sending Muslim Refugees to Your Town?

Very few Americans are aware of the US Refugee Resettlement Program.  In compliance with a United Nations directive, the US government pays nine government contractors (six of them ostensibly church-related) handsome fees to arrange for drops of third-world refugees in cities and towns all over our country, without warning or gaining permission from local governments, who are then forced to provide education, medical care, and social services.  Ann Corcoran, founder of Refugee Resettlement Watch, has been waving the red flag for many years, trying to draw attention to what she says is a dangerous, secretive program:

In April residents of Spartanburg, SC, were alarmed to learn that their city was slated to receive about 60 of the 70,000 incoming refugees in the upcoming year, without any public approval or information about how they would be assimilated into the community.  Under pressure from his constituents, Congressman Trey Gowdy demanded answers from Secretary of State John Kerry:

Dear Secretary Kerry,

I write regarding the potential resettlement of refugees to the Spartanburg, South Carolina, area. It has been reported by media outlets, and confirmed by staff within your Department’s Bureau of Population, Refugees, and Migration (PRM), that a resettlement agency submitted a proposal to open an office in Spartanburg. In addition, it is my understanding that the U.S. Refugee Admissions Program (USRAP) approved the request to resettle a certain number of refugees in Spartanburg.

As the Member of the U.S. House of Representatives representing the Spartanburg area, I am deeply concerned about the lack of notice, information, and consultation afforded to me and my constituents about this issue . . .

Congressman Gowdy asked: Who authorized the resettlement and when?  How was the decision communicated to state and local officials?  What plans are in place to provide and fund food, housing, education and employment for the refugees?   The State Department sent a response, but it did not satisfy Congressman Gowdy, and he continues to press the issue.

Meanwhile, South Carolina governor Nikki Haley came out in support of the refugee resettlement program.  But she admits the lack of transparency has been a problem.

A main criticism of the resettlement program is inadequate screening of the refugees.  Recent news stories about resettled refugees report violent crime, abuse of women and children, refusal to assimilate, and connections to Muslim terrorists. Conservatives also point to the economic impacts – not only the cost of the program, but the seemingly clandestine way that taxpayer funds are diverted to pseudo-charitable agencies run by officials who draw huge salaries.

Since the USA has nothing to gain, and in fact incurs significant cost and risk, by immigrating foreigners from countries who are hostile to us and abhor our way of life, the resettlement program must be considered charity.  But by definition, charity is a voluntary act of giving.  The refugee resettlement program is yet one more instance of our government taking wealth from taxpaying citizens and extending charity without their consent – or even their knowledge.  Our government and news media must provide transparency on this program.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side

We got somethin’ we both know it, we don’t talk too much about it
Yeah, it ain’t no real big secret all the same, somehow we get around it
Listen it don’t really matter to me, baby
You believe what you want to believe
You see, you don’t have to live like a refugee

Refugee – Tom Petty

Just the Facts, Ma’am. Economic Facts.


“Just the facts, ma’am.” – Detective Joe Friday, Dragnet

Here are some economic facts that the mainstream media and the government don’t tell you!

No speech is worth a half million dollars.  In recent years Bill and Hillary Clinton have received some ridiculous amounts for speaking engagements – as much as $750,000 for one Bill Clinton speech in China.   I’m sorry – there is no person on Earth whose words are so precious that they command that kind of money.  The only reason anybody would give Bill or Hillary Clinton such a huge sum is with the expectation of some kind of political favor in return.

You will never again receive any meaningful interest for the money you have saved.  There are 18 trillion reasons why, according to Forbes.  The Federal Reserve has held interest rates to near-zero for over ten years now, enabling our government to borrow and spend sums that it will likely never be able to repay, with or without interest.  This has certainly done no favor for Americans who earned and saved money. Consider this:  if the interest rate on our $18 trillion national debt increased to the normal historical level of five percent, it would cost our government almost a trillion dollars a year – about a quarter our current annual budget!

Do you think anybody in Washington, DC will allow that to happen?  You might want to look for an investment alternative to that savings account or certificate of deposit.

No Congressman or Governor can become a multi-millionaire from only his or her salary.  Our US Representatives earn $174,000 per year, plus expenses.  The cost of living in Washington, DC is crushing, and some members sleep in their offices to avoid the hefty DC apartment rental rates.  But many legislators have enjoyed tremendous gains in net worth during their tenure as public servants.  The median net worth for members of Congress exceeds $1 million.  And while many public officials were wealthy before their elections, it seems that profit opportunities abound for those whose votes and influence can generate winners and losers in the private economy.  Former house leader Nancy Pelosi, for example, directed a billion dollars in subsidies to a light-rail company which was a big contributor to her campaigns and also listed her husband as a major investor.  Former Montana Governor Brian Schweitzer parlayed some insider information about a mining operation into a hefty sum.  Former senate majority leader Harry Reid reportedly retired as details of a number of financial scandals were about to surface.  Other examples of public officials striking it rich abound.

The Affordable Care Act is not making health care more affordable.  This year’s Milliman Medical Index, which tracks health care costs for employer-provided plans, shows an increase of 43% for employees and 32% for employers since the ACA took effect. A dramatic increase is expected in 2018 when the “Cadillac Tax” provision kicks in.  And while the total cost of health care by traditional measurement has not increased as rapidly as many ACA critics predicted, a hidden cost is the 21 new and higher taxes that were implemented as part of the ACA.  Medicare is now partially funded by transfers from the general fund, and that amount will increase in upcoming years.

Immigration is not a boon to our economy.  Due to lack of education and employable skills, immigrants – both legal and illegal -use welfimmigrant-welfare-use-4-11-f1are and public assistance programs at a much greater rate than native-born Americans.  71% of Hispanic immigrants with children received public benefits in 2009.

Contrary to President Obama’s contention, most successful wealthy Americans are not “lottery winners”, whose good fortunes are the result of dumb luck.  80% of millionaires are the first generation of their family to get wealthy. Most are self-employed, and have a spouse who helps them succeed financially.   My financially astute wife points out that she never met a wealthy person who set out to be rich.  They were so busy working and building their businesses that they didn’t have time for unprofitable activities.

The economy is not as rosy as we are told by the administration and the media.  The labor force participation rate remains at a 37-year low, and the average real wage (adjusted for inflation) has not increased much since the 1970s.   Many middle class Americans can no longer afford to take vacations without sacrificing something else.

Just the facts, ma’am.  Nothing but the facts.

this article can be seen in its entirety at Watchdog Arena.

Tom Balek – Rockin’ On the Right Side

Rockin' On the Right Side

Look into my eyes
Can’t you see they’re open wide
Would I lie to you baby
Would I lie to you

 Would I Lie to You? – the Eurythmics


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