GM has announced plans to finish a $5.5 billion buyback of stock currently owned by the U.S. Treasury ((The Wall Street Journal). The purchase is part of a larger plan to end government ownership of the auto giant within the next fifteen months.
Alas, the taxpayers are not coming out ahead on the deal. GM’s stock has languished since its initial public offering at $33 per share in 2010, and now trades in the mid $20’s. The buyback price of $27.50 represents a 7.9% premium, and bumped the price of the stock up to $27.18. The WSJ notes:
The Obama administration had been reluctant to sell its GM shares before the November election, in part because of the auto maker’s sagging stock price. It needed the stock to hit $52.39 a share to break even. Now it must sell its remaining shares at $69.72 to break even.
The skeptical mind might think at this point that breaking even is no longer on the table. Still, a deficit-plagued government can use the cash, and politicians would no doubt like to put behind them the resentment at the excesses of the Troubled Asset Relief Program. GM itself is anxious to cut the cord, as the nickname “Government Motors” has unquestionably damaged its brand. And then there is this nugget:
As part of the deal, the Treasury has immediately waived some limitations on the auto maker, such as use of private aircraft to transport executives. Mr. Ammann declined to say when or if GM will move to lease or purchase private aircraft. The inability to use private aircraft has been a sticking point with many GM executives.
As the French would say, the more things change, the more they stay the same.
In case you missed it, a D.C. federal appeals court judge ordered the Obama Administration to fulfill its promise of publishing a new rule that does not violate the plaintiffs’ (Belmont Abbey & Wheaton College) religious freedom. The government was also made to promise never to enforce the current rule which mandates contraception, abortion-inducing drugs, and sterilization against the plaintiffs or similar religious employers.
Religious schools claim ‘major victory’ after ruling on contraception mandate
Published December 19, 2012
Two religious-affiliated colleges claimed a “major victory” Tuesday after a federal appeals court ordered the Obama administration to verify that it is revising the so-called contraception mandate in ObamaCare.
The decision out of the D.C. Court of Appeals effectively reinstated a challenge that had been dismissed by lower courts. Wheaton College and Belmont Abbey College were arguing against the federal health care overhaul rule that requires employers to provide access to contraceptive care.
The Becket Fund for Religious Liberty, which has represented several plaintiffs challenging the rule, hailed the court decision.
“The D.C. Circuit has now made it clear that government promises and press conferences are not enough to protect religious freedom,” Kyle Duncan, general counsel for the Becket Fund, said in a statement. “The court is not going to let the government slide by on non-binding promises to fix the problem down the road.”
The court ruling did not overturn the contraception mandate. Rather, it effectively put the court case on hold while requiring the Obama administration to follow through on its pledge to revise the mandate as it pertains to religious-affiliated groups.
“We take that as a binding commitment,” the court said in its ruling Tuesday. The court ordered the administration to file status reports every 60 days on its progress toward issuing a new policy in the first quarter of 2013.
The contraception rule does include an exemption for religious organizations — but that exemption does not cover many religious-affiliated organizations like schools and charities.
Complaints about the narrowly tailored exemption prompted a stand-off between the Obama administration and religious groups earlier this year. As a compromise, Obama and Health and Human Services Secretary Kathleen Sebelius decided insurers — and not the religious-affiliated organizations themselves — would be required to offer contraceptive coverage directly, supposedly without cost-sharing.
But the Becket Fund points out that the administration “has not yet taken the steps necessary to make that promise legally binding.”
The court decision Tuesday would require the Department of Health and Human Services to follow through.
The case is one of several that have continued to wend their way through the system, even after the Supreme Court upheld most of the health care overhaul over the summer.
Meanwhile, other groups have expressed concern about what the mandate will mean for their own survival. One group, The Little Sisters of the Poor, told The Daily Caller that the mandate could be a “serious threat” to the group’s U.S. mission of 300 nuns.
The organization, as a Catholic group, opposes contraception, and the concern is that the fine that could be imposed for violating the rule would impose financial hardship. “We have no extra funding that would cover these fines,” Sister Constance Carolyn Veit, spokeswoman for the organization, told the Caller.
Coalition Calls for President Obama to Keep Gitmo Open — and Keep Its Detainees Confined There
(Washington, D.C.): The Coalition for Security, Liberty and the Law – a group of military, intelligence, and security policy professionals with substantial national security experience – has sent a letter to President Obama urging him not to veto the National Defense Authorization Act of 2013 (NDAA) over restrictions on the transfer of Guantanamo Bay detainees to the United States, and to instead let those restrictions stand.
The letter also notes that Guantanamo Bay is humane and uniquely secure, and that there is little evidence to suggest that the facility has played a significant role in the recruitment of terrorists to al Qaeda or affiliated organizations.
Signers of the letter (the full text of which can be found below)
Frank J. Gaffney, Jr., President and CEO of the Center for Security Policy, stated: “As President Obama has yet to withdraw from his misguided pledge to close the detention/interrogation facility at Guantanamo Bay, it is imperative that he hear from military and security experts who understand the risks to national security associated with keeping this pledge. The President should put national security before politics and allow the provisions of the FY 2013 National Defense Authorization Act prohibiting the transfer of Gitmo detainees into the United States to become law.”
About the Center for Security Policy
The Center for Security Policy is a non-profit, non-partisan national security organization that specializes in identifying policies, actions, and resource needs that are vital to American security and then ensures that such issues are the subject of both focused, principled examination and effective action by recognized policy experts, appropriate officials, opinion leaders, and the general public. For more information visit www.centerforsecuritypolicy.org.
Coalition for Security, Liberty and the Law
20 December, 2012
President Barack Obama
The White House
1600 Pennsylvania Ave, NW
Washington, D.C. 20500
Dear Mr. President:
As you are aware, the National Defense Authorization Act of Fiscal Year 2013 – the final text of which was agreed upon recently by House of Representatives and Senate Conferees, and will soon come to a vote before both bodies – contains a provision prohibiting the use of federal funds to transfer terrorist detainees from Guantanamo Bay to facilities inside the United States.
Our past experience as military, intelligence, and security policy professionals leads us to believe that the transfer of Guantanamo detainees into the United States would threaten national security and public safety. We therefore urge you not to veto the NDAA over this provision and instead allow it to stand.
Detainees transferred to U.S. prison facilities would turn those prisons – and nearby civilian populations – into terrorist targets. Based on past experience in Guantanamo, they would expose prison staff to unique threats, physical risks and legal liabilities. It is also likely that detainees, with help from counsel, would pressure prison officials to remove special security restrictions. If successful in such efforts, the detainees could have opportunities to radicalize the prison population – a risk previously noted by FBI Director Robert Mueller.
To the extent that detainees would receive criminal trials if transferred to the United States, such trials would entail granting due process and other rights that may force the government to choose between revealing classified evidence to secure a conviction in a U.S. court or dropping charges against dangerous terrorists.
Some have argued that Guantanamo remains a symbol of “torture”, and therefore a recruitment tool for terrorists that must be shut down. However, Guantanamo is not only a highly humane and – according to Attorney General Eric Holder – a “well-run, professional facility”, it is also uniquely secure in ways that cannot be replicated at detention facilities within the United States. Additionally, there is little evidence that Guantanamo has played a significant role in the recruitment of terrorists to al Qaeda or its affiliates.
For these reasons, we believe strongly that the detainees should not be transferred to any locale in the United States or its territories, and should instead be kept at Guantanamo Bay. The potential national and local security risks associated with transferring detainees to the United States greatly outweigh any perceived benefits for American foreign policy or national security if such closure were to take place.
Hon. Michael B. Mukasey, former Attorney General of the United States
R. James Woolsey, former Director of Central Intelligence
Adm. Jerome L. Johnson, USN (Ret.)
Adm. James “Ace” Lyons, USN (Ret.)
Lt. Gen. E.G. “Buck” Shuler, Jr., USAF (Ret.)
Brig. Gen. William A. Bloomer, USMC (Ret.)
Brig. Gen. William Weise, USMC (Ret.)
Tidal McCoy, former Acting Secretary of the Air Force
Andrew C. McCarthy, former Chief Assistant United States Attorney
Frank J. Gaffney, Jr., former Acting Assistant Secretary of Defense for International Security Policy
Debra Burlingame, 9/11 Families for a Safe and Strong America
Elaine Donnelly, 1992 Presidential Commission on the Assignment of Women in the Armed Services
ALEXANDRIA, VA – The following commentary by the Coalition to Reduce Spending’s Jonathan Bydlak and Corie Whalen appeared in Real Clear Policy. The piece highlights Milton Friedman’s warnings that increases in spending ultimately result in higher taxes.
The full text is provided below for your convenience:
By Jonathan Bydlak & Corie WhalenKeep your eye on one thing and one thing only: how much government is spending, because that’s the true tax … If you’re not paying for it in the form of explicit taxes, you’re paying for it indirectly in the form of inflation or in the form of borrowing. The thing you should keep your eye on is what government spends, and the real problem is to hold down government spending as a fraction of our income, and if you do that, you can stop worrying about the debt.
– Milton FriedmanAs the fiscal cliff approaches, many are asking whether Republicans should break their pledges and vote to raise taxes.These stories miss the point: Republicans have already voted many times to raise taxes.
As Friedman explained, the true burden of taxation is whatever government spends. Jerry Jordan, a former member of President Reagan’s Council of Economic Advisors, told us recently that Friedman would frequently remind Reagan and others during the early 1980s that reductions in marginal tax rates — which Friedman supported — were not real tax cuts if spending was not reduced.
It is time to remind Republicans that the same rules of economics still apply to today’s deficit spending. The debate over the “fiscal cliff” presents an opportunity to hammer home what is fundamentally flawed about Washington’s approach to funding government.
Let’s start by finally acknowledging that Republicans who have been complicit in deficit spending have repeatedly violated Grover Norquist’s “Taxpayer Protection Pledge.” While Norquist’s pledge has been effective politically, the policy goals of fiscal conservatives remain unfulfilled, because deficit spending is taxation.
The problem with focusing foremost on preventing new taxes is that borrowing and printing to finance government largesse causes even more pernicious economic distortions. While taxation is harmful in the here and now, manipulating interest rate markets alters incentives to invest and consume not only today, but in the future as well.
An opportunity exists to drive the public discussion toward a focus on the true cause of our nation’s fiscal problems: overspending. Only by putting our country on a sustainable fiscal path can we prevent the tax increases that adherents to Norquist’s pledge seek to avoid. This will require that elected officials commit to voting for budgets that are balanced, against new spending programs that are not offset, and against new borrowing that requires increasing the debt ceiling.
An unfortunate unintended consequence of Norquist’s pledge is that it has provided cover to those Republicans who wish to maintain the guise of fiscal responsibility while simultaneously raising the debt ceiling. Let’s be clear: voting not to raise taxes while also increasing deficit spending means we not only have to shoulder the high cost of government, we have to pay for it plus interest.
As Dustin Siggins and the Heritage Foundation’s William Beach recently noted, “[most people] forget about the impact of interest payments on future budgets.” According to their analysis, if interest rates rise to their historical average of 4 percent, interest payments “would jump by 90%” — or more — as the national debt increases.
Grover Norquist was right to focus on creating incentives to shrink government. As Friedman said in 1975, “I do not believe that the solution to our problem is simply to elect the right people. The important thing is to establish a political climate of opinion which will make it politically profitable for the wrong people to do the right thing.”
Ultimately, however, the “Taxpayer Protection Pledge” only addresses one aspect of an increasingly complicated problem. Because many politicians who have signed it continuously vote for more deficit spending, they have in effect violated the pledge. Fear of deficits was supposed to encourage spending restraint. But now, that very fear has been turned around to make conservatives more willing to support tax increases. It’s almost like Milton Friedman saw it coming.