Paul M. Jones

Well, OK, they paid back the part of their bailout that had the word "loan" in it. But they paid it back with other taxpayer money, not with money from business operations. What a bunch of liars. But it's Government Motors now; what should we have expected?

Uncle Sam gave GM $49.5 billion last summer in aid to finance its bankruptcy. (If it hadn't, the company, which couldn't raise this kind of money from private lenders, would have been forced into liquidation, its assets sold for scrap.) So when Mr. Whitacre publishes a column with the headline, "The GM Bailout: Paid Back in Full," most ordinary mortals unfamiliar with bailout minutia would assume that he is alluding to the entire $49.5 billion. That, however, is far from the case.

Because a loan of such a huge amount would have been politically controversial, the Obama administration handed GM only $6.7 billion as a pure loan. ...

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As it turns out, the Obama administration put $13.4 billion of the aid money as "working capital" in an escrow account when the company was in bankruptcy. The company is using this escrow money--government money--to pay back the government loan.

via Still Government Motors.

More links:

Like Shifting Your Credit Card Balance To Another Card

Lawmakers Accuse GM, Administration of Misleading Public Over Loan Repayment

Fun with Numbers: GM ‘Payback’ of Taxpayer Loans

UPDATE (Mon 303 May 2010): Another link: NYT: GM, Treasury lied about bailout repayment

In the United States we like to believe we are a capitalist society based on individual responsibility. But we are what we do. Not what we say we are. Not what we wish to be. But what we do. And what we do in the United States is make it easy to gamble with other people’s money--particularly borrowed money--by making sure that almost everybody who makes bad loans gets his money back anyway. The financial crisis of 2008 was a natural result of these perverse incentives. We must return to the natural incentives of profit and loss if we want to prevent future crises.

via Gambling with Other People's Money | Mercatus.

It is tempting and superficially agreeable for Americans to gloat about Europe’s troubles. After all, every time something goes wrong in American domestic or economic policy, European elites and journalists are quick to gloat and find fault. After listening to two years of stern and self righteous lectures about the ‘failure’ of the American capitalist model, many Americans who deal with the Europeans are quietly enjoying the spectacle of the smug Europeans writhing in helpless indecision and pain over the continent’s self-inflicted wounds.

But bad news for the EU is bad news for us too. Irritating as a strong EU can be, a weak and divided Europe is much worse. A peaceful, prosperous and geopolitically boring continent that exports tedious platitudes about global governance is a far better place than any other Europe we have seen in modern times and American national interests are in no way enhanced by economic and political instability in the Mediterranean -- to say nothing of Ukraine and Turkey.

Europe’s problems end up in the American in-box. The Napoleonic Wars convulsed American politics through the War of 1812. From World War One through the Yugoslav wars of the 1990’s, no great European crisis left us untouched.

It’s too soon to say where this latest euro-crisis is heading, but serious economic or political disturbances in Europe will soon affect us over here -- and not in a good way.

via Europe in Crisis - Walter Russell Mead's Blog - The American Interest.

But there's one thing he does hint at, though he doesn't quite come out and say it: bigger banks might be better for regulators. It may not be smart to put all your eggs in one basket . . . but it's probably a hell of a lot easier for a regulator to watch that basket. Plus, big banks provide nice lots of cushy jobs for regulators to retire into. Small banks don't have quite the same incentives (or payrolls). This may explain something important about what's happened in our banking system over the last few decades.

via Why Does Larry Summers Like Big Banks So Much? - Business - The Atlantic.

Central planning has two primary flaws, when compared with economic freedom: it misallocates resources, and it magnifies the impact of corruption. I could write a decent-sized book explaining both of those mechanisms, but because I’ve never been busier in my life than I have been these past few weeks, I’ll cut to the conclusion.

The endpoint of central planning, if not outright failure, is a much deeper and more intractable division of society into haves and have-nots. After promising a better world for everyone, the progressives will end up creating a society that is more polarized than ever.

via What the Tea Party Movement is Really About | The New Ledger.

America has made the mistake of letting the A student run things. It was A students who briefly took over the business world during the period of derivatives, credit swaps, and collateralized debt obligations. We’re still reeling from the effects. This is why good businessmen have always adhered to the maxim: “A students work for B students.” Or, as a businessman friend of mine put it, “B students work for C students--A students teach.”

It was a bunch of A students at the Defense Department who planned the syllabus for the Iraq war, and to hell with what happened to the Iraqi Class of ’03 after they’d graduated from Shock and Awe.

The U.S. tax code was written by A students. Every April 15 we have to pay somebody who got an A in accounting to keep ourselves from being sent to jail.

Now there’s health care reform--just the kind of thing that would earn an A on a term paper from that twerp of a grad student who teaches Econ 101.

via A Plague of ‘A’ Students | The Weekly Standard.

Via http://artsbeat.blogs.nytimes.com/2010/04/22/south-park-episode-is-altered-after-muslim-groups-warning/?hp we have this:

An episode of “South Park” that continued a story line involving the Prophet Muhammad was shown Wednesday night on Comedy Central with audio bleeps and image blocks reading “CENSORED” after a Muslim group warned the show’s creators that they could face violence for depicting that holy Islamic prophet. Revolution Muslim, a group based in New York, wrote on its Web site that the “South Park” creators Matt Stone and Trey Parker “will probably wind up like Theo Van Gogh” for an episode shown last week in which a character said to be the Prophet Muhammad was seen wearing a bear costume. Mr. Van Gogh was slain in Amsterdam in 2004 after making a film that discussed the abuse of Muslim women in some Islamic societies.

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On Thursday morning, a spokesman for Comedy Central confirmed that the network had added more bleeps to the episode than were in the cut delivered by South Park Studios, and that it was not giving permission for the episode to run on the studio’s Web site.

So we are now at the point where an organization based in New York can issue veiled threats against cartoonists, and the authors' publishers will censor their work.

Censor this, assholes:

Update: See also http://www.advicegoddess.com/archives/2010/04/22/muslims_threate.html and http://althouse.blogspot.com/2010/04/comedy-central-cowers-in-face-of-murder.html.

Update 2: Instapundit says: "Obviously, Christians -- and Sarah Palin fans, and lovers of My Mother The Car -- should take heed of this incentive system our modern media is creating. Don’t want things you treasure satirized? Just issue a “prediction” and -- voila! Meanwhile, note how entirely real radical Muslim threats and violence are treated as just part of the weather -- something you have to adapt to -- while nonexistent Tea Party violence is an existential threat to the Republic."

The essence of pretty code is that one can infer much about the code's structure from a glance, without completely reading it. I call this "visual parsing": discerning the flow and relative importance of code from its shape. Engineering such code requires a certain amount of artifice to transform otherwise working code into working, readable code, making the extra step to leave visual cues for the user, not the compiler.

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Code changes should blend in with the original style.

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Keep columns narrow. Just as with books and magazines, code should be narrow to focus the gaze.

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Two or more pieces of code that do the same or similar thing should be made to look the same. Nothing speeds the reader along better than seeing a pattern.

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Overcome Indentation: The left edge of the code defines its structure, while the right side holds the detail. You must fight indentation to safeguard this property. Code which moves too quickly from left to right (and back again) mixes major control flow with minor detail.

via Whitepaper: Seven Pillars of Pretty Code.

This fragility of tumescent government is what many otherwise thoughtful commentators fail to notice. They think that we can solve our problems with a value-added tax (VAT) or with a fiscal reform commission.

Instead, I believe that the problem is structural. American government will not be stable and sustainable until it is broken up and most of its functions are devolved, so that spending decisions are decentralized. A robust society would have more public goods delivered by the voluntary associations that Tocqueville noticed were characteristic of America. These associations are much more numerous and diverse than our governmental units.

via Size, Scope, and Fragility, Arnold Kling | EconLog | Library of Economics and Liberty.

The tax code has grown so complex that today most Americans hire someone to do their taxes.

For the money I pay my accountant, I could get a hundred massages. I could buy a fancy motorcycle. I could take a cruise ship to Venice and back.

Better yet, I could do some good in the world. I could pay for two Habitat for Humanity homes or help three kids escape government schools by paying their tuition at a good Catholic school.

What a shame that I pay my accountant instead.

via Lower and Simplify Taxes! - Reason Magazine.