Wednesday, August 21, 2019

NYT's Editor Looks In The Mirror. Is Student Debt The Taxpayer's Responsibility?


Baltimore is awesome:Click on"Baltimore isAwesome"(below)
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The New York Times's editorial leadership is looking inward and seems confused.

A free and objective press is important to our republic's survival and good health.

In the past,The New York Times set the pace and standard of excellence.  Today the New York Times has become out of touch, readership and  financials are in decline  and it's embrace of PC'ism has led it astray and out of touch.

What is worse it has become a shill for The Democrat Party.

The Editor recently stated it had focused entirely on Trump Collusion with Russia which proved a total waste of ink and now is singularly concentrating on the defeat of Trump.

The "Gray Lady" has faded and will have a problem returning to its former status. This is partly because newspapers are no longer our main news source having been replaced by technology and social media. Many of American's Icons have disappeared, ie. Eastman Kodak, Sears, Polaroid even IBM in a sense.
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It was only a matter of time before the government's entry into guaranteeing college and university tuition costs that the price of education would soar, employment of campus bureaucrats would explode and the tax payer would be on the hook  because politicians, like Pocahontas, would use it as a way to garner votes.  She is busy selling voters that a free lunch is there for the asking. (See 1 below.)
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Realistically speaking, what can America do for those who want to be free? (See 2 below.)
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These two op ed writers think as I do. (See 3 below.)
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Cliff May weighs in regarding Omar and Tlaib's efforts to create problems for Israel. (See 4 below.)
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Zito interviews Pompeo. (See5 below.)
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Leaving Friday for visit with old and dear Atlanta friends who have a mountain house on a beautiful lake.  Returning Monday.  Have a safe and great Labor Day.
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Dick
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1)

The Great Student-Loan Scam

By The Editorial Board

The magnitude of federal budget losses is becoming clearer.


Some economists are predicting a recession in the next year, but the New York Federal Reserve’s quarterly household debt survey last week showed few portents. What it did show is that more Americans are defaulting on their student loans, and that government budget gnomes have vastly underestimated the future taxpayer charge.


Defaults have fallen for most forms of consumer debt as the economic expansion continues. Mortgage delinquencies last quarter hit a historic low. But severely delinquent student loans have soared since 2012 and are now 35% of “severe derogatories”—more than credit cards (23%), auto loans (21%) and mortgages (11%).
About 10% of the $1.5 trillion federal student-loan portfolio is 30 days or more past due. Another 20% is in deferment or forbearance, and about 30% is in income-based repayment plans that allow most borrowers to cap monthly payments at 10% of discretionary income and discharge the remaining balance after 20 years or 10 for folks in “public service.”

Congress created these nifty plans in 2012 for new borrowers, but then the Obama Administration expanded them retroactively to reduce defaults, buy off millennial voters and disguise the cost of its student-loan takeover. This may be the biggest accounting fraud in history.

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Democrats in the 1990s created a public student-loan option to compete with subsidized private lenders. Then in 2010 they nationalized the market to help pay for Obama Care. The Congressional Budget Office at the time forecast that eliminating private lenders would save taxpayers $58 billion over 10 years. This estimate was pure fantasy, and now we’re seeing how much.
The government student-loan portfolio has since doubled while severely delinquent loans have spiked despite a good economy. Many borrowers in income-based repayment plans aren’t repaying principal, so their balances are growing as they accrue more interest. By 2012 a majority of new borrowers had bigger balances after two years of making payments.
Untruth in Government Accounting
Changes in Congressional Budget Office baseline projections for net outlays for student loans over 10 years.For example, the 2010 number is the projection from 2010-2020 and the 2011 number is for 2011-2021.Negative means net revenue loss, positive is 
Yet during the Obama years CBO scored student loans as a government profit center by underestimating the growth in income-based repayment plans. CBO has slowly scaled back its 10-year revenue projections for student loans to a $31.4 billion government cost in this year’s forecast from a $219 billion 10-year revenue gain in 2012.
The nearby chart tells the story. Using fair-market accounting that prevails in the private economy, CBO now projects a $306.7 billion cost to taxpayers over the next 10 years. The red ink will be far worse beyond that 10-year budget window.
Another non-surprise: The government is spending more to administer student loans than the Obama crowd forecast. In 2010 the government spent $800 million on “administrative costs,” which CBO projected would increase to $1.2 billion in 2019. The government’s overhead tab this year was $2.9 billion.
Income-based repayment plans have also encouraged schools to raise prices and enroll students who probably won’t earn enough to pay off their loans. Someone with a master’s degree in dance from New York University shoulders on average $96,000 in debt, according to government data. Imagine if the government created income-based repayment plans for mortgages.
Capping student-loan monthly payments has also enabled more borrowing since most lenders review a customer’s total monthly debt payments when underwriting loans. Americans who borrow more than they can repay typically default first on student loans. Cars and homes can be repossessed if borrowers don’t make payments. Past-due credit card bills incur late fees and hefty interest payments. Borrowers who default on student loans, on the other hand, are encouraged by loan servicers to enroll in income-based repayment plans.
As long as borrowers are making de minimis monthly payments on student loans, their credit scores won’t be hurt. The upshot is that student-loan borrowers collectively are paying down a mere 1% of their balance each year, according to a recent Bloomberg News analysis. At this rate the U.S. Treasury’s existing student-loan portfolio wouldn’t be repaid for 100 years.
But many loans will be written off long before then due to the Obama repayment plans. “We are running a big experiment here: No generation before has carried student debt burdens anything like what today’s students are carrying,” former Obama higher-education adviser James Kvaal told Bloomberg. “There will be substantial amounts of student debt that will never be repaid.” Now he tells us, though he should have done so in 2010.
All of this is worth keeping in mind as Democrats promise to save taxpayers billions by taking over other private industries and expanding the cradle-to-grave entitlement state.
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2) We Stand With Hong Kong

Sooner or later, the rest of the world will have to do what the protesters are doing—confront Beijing.

By Mitch McConnell

The Hong Kong crisis is something the world has seen time and again: authoritarian rulers seeking to repress the innate human desire for freedom, self-expression and self-government. The scenes remind us of Budapest in 1956 and the Prague Spring of 1968, of Tiananmen Square in 1989 and Moscow in recent weeks. The next chapter is unfolding today as the Chinese Communist Party terrorizes the people of Hong Kong.


An estimated two million Hong Kongers—about one-fourth of the population—are demonstrating for the freedoms and autonomy that have made their city a global success. They are protesting the government in Beijing and its determination, in violation of its promises, to chip away at those freedoms.
The protestors want their liberties preserved, the territory’s autonomy respected, and justice for those the security services have detained, brutalized or murdered. Contrary to Communist propaganda, this citizens’ uprising is no foreign conspiracy. If anything, the world’s leading democratic nations have been slow to respond. Only one capital is responsible for what is unfolding in Hong Kong: Beijing. The demonstrators are responding to its efforts to exert ever more influence and control over what is supposed to be an autonomous region.
It is crucial to recognize that the dynamics that led to this crisis didn’t begin in Hong Kong and won’t end there. The turmoil is the result of Beijing’s systematic ratcheting up of its domestic oppression and its pursuit of hegemony abroad.
Years ago, it was reasonable to think that China’s rapid development and integration into the global economy might lead it to embrace prevailing international rules, that success would give Beijing a stake in the systems that uphold peace and prosperity. Now it is clear the Communist Party wants to write its own rules and impose them on others.
For evidence of China’s hunger for power, consider the fate of its other supposedly autonomous regions. In Tibet, Beijing’s brutal response to unrest in 1959 drove tens of thousands into exile and killed tens of thousands more. In Xinjiang, a mostly Muslim province, the state has displaced ethnic Uighur minorities through population transfers and established an elaborate architecture of social and political surveillance, including ethnic prison camps. Xinjiang is no autonomous region; it is a modern gulag. In both cases, Beijing spent decades methodically tightening its grip.
Beijing has sought to write a similar story in Hong Kong, albeit more subtly. But Hong Kongers are not cut off from the truth by China’s “Great Firewall.” They recognized a bill to allow extradition to the mainland as a significant threat to their legal and political autonomy. So China’s leaders now face a choice. Will they intensify pressure on Hong Kong, gambling that the rest of the world will look the other way? Or will Beijing conclude that further repression in Hong Kong would bring further consequences?
China’s trading partners, including the U.S., should make it clear that any crackdown would have real and painful costs. I wrote the Hong Kong Policy Act of 1992, which extended special privileges to the region because of its unique status. This special access to the U.S. and other nations helped drive the investment and modernization that have enriched Hong Kong, and Beijing by extension. Beijing must know the Senate will reconsider that special relationship, among other steps, if Hong Kong’s autonomy is eroded.
I support extending and expanding the law’s reporting requirements to illuminate Beijing’s interference in Hong Kong. And the Senate will do more. I have asked Jim Risch, chairman of the Foreign Relations Committee, to examine Beijing’s actions in Hong Kong and its efforts to expand the Communist Party’s influence and surveillance across China and beyond. I am working with Lindsey Graham, chairman of the Appropriations Subcommittee for State and Foreign Operations, to fund democracy and human-rights programs across Asia. I will maintain our strong focus on rebuilding and modernizing the military, continuing the huge strides of the past 2½ years, so that our ability to project power and defend American interests keeps pace with this major competitor.
But it is not America’s task alone to address these threats. The world is awakening to China’s abusive and aggressive practices, from unfair trade actions to intellectual-property theft to offshore expansion. Now Hong Kong has plastered front pages with yet another cautionary tale about how the Chinese regime treats those within its envisioned sphere of influence and disregards international agreements that govern them.
Every trading nation and democracy that values individual liberty and privacy has a stake here. Their choice is not between the U.S. and China but between a free, fair international system and the internal oppression, surveillance and modern vassal system China seeks to impose.
The U.S., for its own interests, seeks international peace, a good relationship with China, and a mutually prosperous future for our peoples. Hong Kong is only one piece of the complex set of interests that makes up the U.S.-China relationship. But China’s treatment of the people of Hong Kong will shape how the U.S. approaches other key aspects of our relationship.
As Beijing grapples with growing domestic unrest and slowing economic growth, it should pause before threatening a key engine of its growth and provoking the international community. Beijing can step back from chaos to pursue freer and fairer trade and greater respect for sovereignty and human rights. These basic steps can ensure a more prosperous and peaceful future for all of our citizens.
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3) Recession
Fears Are Overblown



The yield curve is no longer a reliable predictor, and other economic indicators are strong.

By Andy Puzder and Jon Hartley


The yield curve is upside down, leading to worry about recession. Stocks declined last week after the 10-year Treasury yield fell below the two-year Treasury yield. Yet while an inversion of the yield curve has preceded all postwar recessions, not all inversions signal imminent recession. The curve was flat for most of the 1990s, and even inverted briefly in 1998, without a recession. Today, given the economy’s underlying strength, fears of immediate recession are overblown.
U.S. gross domestic product grew 2.1% in the second quarter, and the Atlanta Federal Reserve forecasts 2.2% annualized third-quarter growth. The generally accepted definition of a recession is two consecutive quarters of negative GDP growth. GDP consists of four components: consumption, government spending, net exports and business investment.Consumption looks strong. Through July, retail sales have increased this year, consumer confidence has rebounded, and productivity—output per hour worked—has experienced some of the largest increases in decades. When a recession occurs, weekly unemployment claims are first to tick up. They aren’t rising, and there are more openings than unemployed people. Given this labor-market strength, an increase in consumer spending—which accounted for 68% of GDP in 2018—is far likelier than a decrease.Government spending accounted for 18% of GDP in 2018 and grew 3% during the first half of 2019 amid growing deficits. Net exports reduced last year’s GDP by 3.3%, down to 3.1% so far this year.
That leaves business investment, which represented 18% of 2018’s GDP. Concerns about the impact of a trade war with China on costs and supply chains combined with slowing global growth have dampened business investment. It declined 0.6% (seasonally adjusted) in the second quarter despite a 2018 surge following the 2017 corporate tax cuts.
Yet the trade war has not as yet put the U.S. economy at risk. Any dramatic impact remains far off as the Trump administration announced a further delay—until December—on a tariff hike to 25% on $200 billion of Chinese imports. Even with reduced business investment, the data don’t signal a significant economic decline.
So should an inverted yield curve put us on recession alert? Maybe not. There’s reason to believe it is an unreliable recession indicator. The post-Great Recession era has seen unprecedented distortions in the Treasury market. The Fed’s trillion-dollar balance sheet following its long-term asset purchases, known as “quantitative easing,” has put downward pressure on the long end of the yield curve. Fed researchers estimate that quantitative easing may be pushing down the 10-year Treasury yield by as much as 0.7 percentage point in 2019.
In addition to quantitative easing, $16 trillion in sovereign bonds with a negative yield are weighing down longer-term Treasury yields, as even low-yield U.S. bonds are a more desirable option for foreign investors.
Moreover, the Treasury has elected to fund the rapidly increasing U.S. debt by issuing a high volume of short-term Treasury bills, putting significant upward pressure on the short end of the yield curve.
This combination of downward pressure on long-term rates and upward pressure on short-term rates is distorting the yield curve, wholly apart from the strength of the underlying economy, rendering it an unreliable harbinger of recession.
It’s also important to remember that there have been two primary causes of recessions in the postwar period: financial imbalances (like bubbles in the technology or housing market) and aggressively tight monetary policy. It’s hard to identify any major imbalances (apart perhaps from nonfinancial corporate debt), and the Fed is reducing rates.
At this point, without materially worsening data from the real economy, an inverted yield curve should not be causing the exaggerated reaction we’re seeing in the stock and bond markets. Someday we’ll have a recession, but not soon.
Mr. Puzder is a former CEO of CKE Restaurants and author of “The Capitalist Comeback: The Trump Boom and the Left’s Plot to Stop It.” Mr. Hartley is pursuing a master’s degree at Harvard’s Kennedy School.
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4)The anti-Israel lobby
Reps. Tlaib and Omar are on a mission to defame and de-legitimize the Jewish state 
I’m a stickler for sovereignty. Sovereign nations have borders and their leaders decide who gets to cross them. Excluding individuals who are hostile or even just objectionable is common practice. Among those who have not been permitted to come to America: Michael Ben Ari, a far-right Israeli legislator, and Narendra Modi, accused of doing too little to prevent anti-Muslim riots in 2002, and now India’s prime minister.

Unless Israel is to be held to a separate and unequal standard, its leaders must enjoy the same right, which they exercised by declining to welcome Ilhan Omar and Rashida Tlaib.

The dominant media narrative is that Benjamin Netanyahu excluded the two far-left congresswomen in deference to President Trump, who had tweeted that they “hate Israel & all Jewish people, & there is nothing that can be said or done to change their minds.” Perhaps that did influence the prime minister’s thinking, but other factors undoubtedly were weighed as well. Allow me to mention a few.

House Majority Leader Steny Hoyer invited Reps. Omar and Tlaib to join a bipartisan delegation that went to Israel and the West Bank earlier this month. They preferred not to accompany their colleagues.

Separately, the Israeli government granted a request by Rep. Tlaib to enter the West Bank to visit relatives, asking only that she not use the occasion to promote boycotts against Israel. She said no deal.

The itinerary for their trip was titled: “Delegation to Palestine.” That strikes me as erasing Israel from the map. When they landed at Tel Aviv’s Ben Gurion Airport, where did they think they would be?

They were planning to meet with individuals and groups directly tied to terrorism and anti-Semitism. Among them: Shawan Jabarin, identified by Israel’s Supreme Court as a senior member of the Popular Front for the Liberation of Palestine, a Marxist-Leninist organization responsible for airplane hijackings and suicide bombings, and designated as a terrorist entity by the U.S. Japan, Canada, Australia, and the European Union.

Organizing their visit was Miftah, an organization that in 2013 published an article alleging that Jews use Christian blood for their Passover matzahs – a very old and very sicklibel

Miftah also published “an American neo-Nazi treatise” called “Who Rules America: The Alien Grip on Our News and Entertainment Media must be Broken.” Apparently, to Ms. Tlaib and Ms. Omar, white supremacy in defense of Jew–hatred is no vice.

Reflect on this hypocrisy: While Ms. Tlaib and Ms. Omar support boycotting Israelis they profess outrage that Israelis might choose to boycott them.

More specifically, they support BDS (for boycott, divest and sanction). Considering that the Nazi slogan in the 1930s was, “Don’t buy from Jews,” how surprising is it that Israelis hear an echo in the BDS slogan, “Don’t buy from the Jewish state”?

Bill Maher called BDS a “bullshit purity test by people who want to appear ‘woke’ but actually slept through history class.” Demonstrating yet more hypocrisy, Ms. Tlaib responded by calling for a boycott of his television show.

The goal of BDS, as stated by its founder and leader, Omar Barghouti, is Israel’s extermination. “Definitely, most definitely we oppose a Jewish state in any part of Palestine,” he has said on video. “No Palestinian, rational Palestinian, not a sell-out Palestinian, will ever accept a Jewish state in Palestine.” 

Some BDS advocates quibble that they merely want Israelis to withdraw from the “occupied territories.” But after Israelis withdrew from Gaza -- which Israelis had seized from Egypt, not Palestinians, in the defensive war of 1967 -- Hamas took over, and began attacking Israelis with missiles, terrorist tunnels and incendiary kites. Hamas is candid about its intentions toward Israelis: They are genocidal.

Were Israel to withdraw from the West Bank without guarantees of peace and security, Hamas almost certainly would take power, and launch more attacks. Israelis would respond. Both Jews and Palestinians would be killed. BDS advocates such as Reps. Tlaib and Omar appear untroubled by that eventuality.

This, too, should not go unremarked: In Syria, more than half a million people have been slaughtered, and millions left homeless thanks to a war that continues to this day. The Sinai is occupied by Islamist terrorists targeting the government of Egypt. Yemen is a war-torn disaster. The suffering of the people of the West Bank is, objectively, less dire, and could be significantly relieved were their leaders to agree to peacefully coexist with Israel.

For all that, I do wonder if Mr. Netanyahu might have managed to beat the defamation and de-legitimization campaign that Ms. Omar and Ms. Tlaib planned to wage.

What if he had assigned them a security detail composed of Israelis whose parents had been rescued from Ethiopia and Sudan? (If you don’t know the heroic story behind the liberation of Africa’s black Jews watch “Red Sea Diving Resort” now available on Netflix.)

What if he had suggested they visit Sderot, one of the Israeli towns near Gaza where bomb shelters are in every children’s playground?

What if he had invited them to meet with prominent Israeli citizens – including Jews, Arabs, Muslims, Christians and Druze? Do the congresswomen deny that Israel’s minorities have rights denied to even the majorities in the Arab and Muslim nations of the Middle East?

Might this have led to less public relations damage for Israel than that which Ms. Tlaib and Ms. Omar have been able to inflict over the last few days? I don’t know. Israelis have never been adept at PR. What Israelis – and indeed the Jewish nation – have demonstrated instead: a talent for surviving, and even thriving, despite the hatred and violence directed at them by so many enemies over so many centuries.

Clifford D. May is founder and president of the Foundation for Defense of Democracies (FDD) and a columnist for the Washington Times
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5)
Mike Pompeo says no to Senate run in exclusive, wide-ranging interview

WASHINGTON-Mike Pompeo closed the door on any speculation he might run for the open Senate seat in Kansas next year. "I am going to stay here," he said in an exclusive interview with the Washington Examiner. "There's lots of people talking about it. The only one who's not talking about it is me."
Click here for the full story.
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