The John Batchelor Show

Tuesday 28 May 2013

Air Date: 
May 28, 2013

Illustration, above: Structural problems with the Bay Bridge, San Francisco.  See: Hour 3, Block B:  Jeff Bliss, The Bliss Index.


Co-host: Larry Kudlow, The Kudlow Report, CNBC; and Cumulus Media radio

Hour One

Tuesday  28 May  2013 / Hour 1, Block A: Larry Kudlow, in re: DOJ had to go judge-shopping – to three judges -  to get their Rosen werrants accepted; finally found Judge Royce Lamberth.*   David Axelrod threw Eric Holder under the bus.  "I don't think journalists should be investigated in case of a leak." Closing of the ranls by journalists of every stripe.  In the US, journalists are protected under the First Amendment.  Additionally, Holder may have lied before the Jusiciary Committee under oath saying he had not part in the Rosen affair – but he signed the documents. Justice often speaks with journos; here, Justice didn’t even bother to get in contact with Rosen.  DOJ says it sent a note to Fox but Fox can’t find it anywhere. This is an aggressive investigation; I don’t understand why Holder would do this, as he knew full well it'd lead to a huge controversy.

*"After his Justice Department fought so hard to keep the search warrant for James Rosen’s private e-mail account secret, going over the heads of two judges in the process, Holder should have felt "a creeping sense of personal remorse."

Documents have been unearthed showing that two judges had declared that the Justice Department was required to notify Rosen of the search warrant, but Ronald C. Machen, Jr., the U.S. Attorney who was investigating Stephen Jin-Woo Kim, the former State Department adviser accused of leaking classified information to Rosen, insisted that Rosen not be informed of the search and seizure of his emails." 

Tuesday  28 May  2013 / Hour 1, Block B:    John Tamny, Real Clear Markets, Forbes, and H C Wainwright advisor, in re: Bias is a human condition, and because it is, what happened at the IRS is not a scandal.  It's only natural that an entity funded by politicians would scrutinize organizations possessing a skeptical view of government.  The real scandal is that a nation founded on very limited government would empower the IRS to begin with.  It's a lot more than Lois Lerman – half a dozen others deeply involved; who was quarterbacking? Who at Treasury knew, and how abt Geithner? And how could the president's chief of staff wait to tell him? Hostory teaches us to explain everything right away [before it festers]. Cincinnati: of 26,000 EOS, all but 76 were approved; a policy decision was made in 2009, and not in Cincinnati.  Need as special investigation to solve what occurred in Washington. Jay Sekulow – was once an IRS lawyer -  has applications from his clients w signatures from pp in Washington.  To a person, Cincinnati people say they were very tightly managed by Washington . I want a prosecutor who can empanel a grand jury. Who were these people? As Laffer said about Clinton, the best thing about him is that he's distracted.  My problem with a flat tax is that it'd generate way too much revenue for Washington, I don’t want to account to the feds, and a sales tax would solve that. Why do we need 501(c)3s and 4s? Why can’t you give as much as you want to political candidates and then post it on the Internet?

Tuesday  28 May  2013 / Hour 1, Block C: .Richard A Epstein, Hoover Institution, Chicago Law, in re: High-End Health Plans Scale Back to Avoid ‘Cadillac Tax’  As part of the new health care law, companies that offer high-end health care plans to their employees will face a 40 percent tax in 2018, and many are scaling back some benefits.   Watching Obamacare Unravel  Defining Ideas (Hoover Institution). On Friday, May 10, President Obama ventured into Ohio to give a Mother’s Day defense of the sagging fortunes of his signal achievement, the misnamed Patient Protection and Affordable Care Act. The law, the President assures us, “is here to stay”—a comment that is best regarded as a threat and not a promise. His conclusion was not coincidental; support for the ACA has dropped from 42 percent to 35 percent between November 2012 and April 2013.  This recent drop in popularity is not a function of some detailed analysis of the ACA’s key provisions. Rather, the public seems to feel that the sheer complexity of the program makes it highly unlikely that it will be able to take effect in any form by its ostensible January 1, 2014 start date. The most obvious difficulty in implementation stems from . . . 

Former Senator Ben Nelson helped to craft the dreaded Obamacare and Dodd-Frank laws, now is CEO of the National Association of Insurance Commissioners (NAIC). Some actuaries claim that you can have a smaller plan, a provision htat permists smaller plans having some degree of choice.

No one knows what the call centers are supposed to explain, don’t even know what the nbenfit structure is supposed to look like. Not clear that anyone in the state plan will be eligible for __. Individual states have to get ermission from the feds for everything.  Convoy problem: whole system goes at the pace of the slowest ship.  Massive complication – urban, rural, every kind of population having different needs.  Labbor unions in full revolt: they’ll have to pay more to get less.  Many distoritions. John Goodman: If you look at the individual plans, they charge females and males exactly the same – but young females cost more [whereas older men cost more].  Young people won’t want to play.  Subsidies for families up to $90K PA. Young subsidize the old, and young men subsidize the young women. No one allowed to be refused coverage. Two simple adjustments would solve: wait three months for coverage for pre-existing conditions, and must sign on for at least a year. To hire 100,000 people, youcan;tpay htenm $50K PA – wil have to train htem, wind up paying thenm a great deal.  The neediest peopke will get lost between the call centr, wenbsite and all the [other paraphernalia]. The Vasa, blt by Swedish navy: the navy kept saying, We have to make this bigger and faster and with more guns, and adding more and more; when they finally launched it, it sailed 200 meters off the dock and sank because it was completely unstable. ObamaCare is the Vasa.

Tuesday  28 May  2013 / Hour 1, Block D: Larry Kudlow,  in re:

Hour Two

Tuesday  28 May  2013 / Hour 2, Block A:  Abheek Bhattacharya, Heard on the Street WSJ in Hong Kong,  and Patrick Chovanec, chief strategist at Silvercrest Asset Management ,in re:  people expected 10%growth for years on end – once you reach a certgsin point, an emerging economy can’t simply relot y on foreign technologies, have to institute refoerms. China is flooding the market with cresdit, can't sustain and unsustainable investment boom – that wd conrtribute to the world's problems. Indonesia, Australia, have to reevalute the prices they charge for raw materials.  India has a billion-plus consumers.  Bangladesh and Vietnam are cheap mfrs for the developed economie. The most recious asset tright now is a consuming population. C hina's workforce is ageing and shrinking; in long term, suggests that all of Asia has to adjust: China will not be the workhorse it was. India sees japan and China growing older, but has not invested in the right part of the supply chain. A mfr in Guangzhou can get stuff in and out swiftly, which India cannot now do.  US is a rare entity – it';s pulling its weight – remarkable for a country you would have written off ten yours ago in oil and fgas supply.

Tuesday  28 May  2013 / Hour 2, Block B:  Charles Pellegrino, author and explorer, in re: about the violin - which will likely go for up near a million dollars at auction - the ultimate realization of the thankless job: The widows of Titanic's band members were billed for the loss of the golden lapel tags and buttons on their husband's uniforms. The double survivors: approx 300 people survived the Hiroshima bomb; were taken on two trains to Nagasaki.  About 90% were killed in the second atomic bomb; 30 survived and witnessed both bombs. We lost the last one of these about three months ago. Kenshe Hirata revcovered his wife's bones from the hypercenter in Hiroshima, carried them to her parents's house in Nagasaki – and was shielded from the second bomb.  The bombs and the whole war are still very sensitive topics in Japan. During ht past three years, abt 300 people have come forward through major Japanese museums, in response to recent denials of radiation.

Abenomics: easing – spurs anticipatory gain ins stock mkt; fiscal part; and "Third Era" – structural reforms - ambitious program to open economy to trade, labor reform, et al.  Everyone around Asia speaks of Japan, it’s the big trade right now. Note that Koizumi actually pushed through soe srtuctrural reforms. LDP is the grand old party of Japan, so If Abe can pull this off it'll be a miracle  (like the PRI in Mexico, Congress in India.) families won't let anyone know their children were near Fukushima.

Tuesday  28 May  2013 / Hour 2, Block C:  .Patrick Chovanec, chief strategist at Silvercrest Asset Management, and Abheek Bhattacharya, Heard on the Street WSJ in Hong Kong, in re: gold: used to be a one-way trade up, now looks like one-way trade down.  Gold is a store of value, doesn't produce a return in and of itself.  People were afraid about the global economy and  the Planet of the Apes scenario – but that's subsided. One story that needs to be highlighted: this is a gold crash only anent Wall Stret, in and out ETFs, etc. However, Chinese and Indian househiolds bought gold in the spring.  When the Chinese economy gets wobbly, they run out and buy gold. Immed after the gold crash, 300 million tons of gold were purchased in China – bumped the price upo again (and then it receded).  It’s culturally seen as a store of value (not a theory of finance).  Middle-class Asian households need it; 38% of gold bought in China is in gold bars; another 40% in jewellery, huge chunks cast as a rat, for example. Metals in the Twenty-first Century: generallyneed metals, but two factors ("commodities supercycle"): China will slow down in its demand for metals; also, we don’t see the future of monetary easing. Once the prices got so high, people einvested in extra capacity, which now will bring the price down. Australians just realizing the Chinese investment boom is no longer – iron ore, copper, will ease off. Australians rode a windfall, but it's not the new normal.  Monetary easing led to asset inflation.  US selling oil and gas to Asia?  Japanese very excitied at prospect of buying US nat gas (Cheaper than from Australia); will change our domestic economy; Chinese mfr said that for 20 years wd always bld a new plant in China, but now will be in the US.  Surprise if the US becomes the world's gas station.

Tuesday  28 May  2013 / Hour 2, Block D:  Mark Schroeder, Stratfor,

Hour Three

Tuesday  28 May  2013 / Hour 3, Block A: Malcolm Hoenlein, Conference of Presidents, in re: Pres Abbas, and John Kerry's plan: "The granddaddy of all conflicts" – but by no means the central issue at present. Daily Beast: Pentago asked by WH to prepare a no-fly zone over Syria. The S300 missile from Russia. Hezbollah build-up; 5,00o in Syria, 5,000 more to come.   Today "rebels" capurtured tw UN indestructible? vehicles.  Lebanon pays the price fo r escalation.  Saad HNariri, former PM, spoke of ssectarian jcitement ansd attacked Nasrallah; hereafter a series of attqacks vs Hez installations. In every sensitive point in this area, incl a rocket fired into Israel, see a great intensification, escalation of potential costs on each front.  Iran: Jalili is "slavishly devoted" to the Supreeme Leader, and "a man of limited intellect." Velayati was childhood friend of a certin Special Advisor at the White House; one of these two will probably win the presidency in Iran.

Tuesday  28 May  2013 / Hour 3, Block B:  Jeff Bliss, The Bliss Index, in re: the Bay Bridge – one  going to Yerba Buena, coming in 2014? and one which goes to Treasure Island. During the earthquake, a portion of the bridge fell from the upper to the lower level. People still drive on the old span; Caltrans very nervous lest there be another quake. New will be a "self-anchoring" bridge, the only one in existence. Tie rods corroded by salt air.  Opening to be delayed.  New bridge: testing not yet complete on the 2306 fasteners on the bridge.  An engineer in a 17-page letter: Hydrogen was the culprit with the tie rods, but the metallurgist failed to address the basic conditions; possible that results were falsified.

Every day the old eastern span of the Bay Bridge remains in use is a day motorists face the risk of catastrophe, Caltrans engineers say.  Caltrans and the Metropolitan Transportation Commission must weigh that risk in deciding whether to delay the scheduled Labor Day weekend opening of the new eastern span while dealing with suspect steel rods – something . . .  [more]

Tuesday  28 May  2013 / Hour 3, Block C: Hopper: A Journey into the American Dream by Folsom, Tom  (1 of 2)  Denis Hopper just got his first big break, on TV; Harry Cohn says You'll have a huge career. Hopper was a clasically trained Shakespearean actor; Cohn mocked him, Hopper spoke rudely – and succeeded anyway.

Tuesday  28 May  2013 / Hour 3, Block D: Hopper: A Journey into the American Dream by Folsom, Tom  (2 of 2)

Hour Four

Tuesday  28 May  2013 / Hour 4, Block A: Rep Devin Nunes (CA-22), in re: odd balloting and election processes in California. Provisional ballots: absentee or late-filled-out votes: "vote-harvesting." 

Tuesday  28 May  2013 / Hour 4, Block B: Ramesh Ponnurru, Bloomberg/NRO, in re: Bloomberg View: Obama’s Dangerous Contempt for the Rule of Law  Whatever the investigation into misconduct at the Internal Revenue Service reveals, we already have all the evidence we need to understand President Barack Obama’s fundamental attitude toward the rule of law. That evidence is right there in the public record, and what it shows is indifference and contempt. The Constitution gives the president the power to appoint officials to fill vacancies when the Senate isn’t in session. In 2012, Obama made such “recess appointments” to the National Labor Relations Board and the Consumer Financial Protection Bureau -- even though the Senate had stayed in session precisely to keep him from doing so. [more]

Tuesday  28 May  2013 / Hour 4, Block C: Jed Babbin, NRO, in re: The Thursday speech was inevitable. Obama declared peace when there isn't any. The enemy remains undefeated and that means he gets a vote on when the war ends. The American Spectator : Obama Declares Peace  It was only last week that I posed the question of how long the war the terrorists are waging against us will continue. President Obama answered that question in his 23 May speech at the National Defense University. His answers should scare the hell out of you.  My question was posed in the context of the answer given by Assistant Secretary of Defense for Special Operations Michael Sheehan in a congressional hearing the week before my column appeared. His answer to the “how long” question was “I think it’s at least ten or twenty years.” Sheehan was clueless. And so is Obama. The president has proclaimed a lack of interest in victory, and like Sheehan, he cannot describe—as “outcome-based warfare” doctrine requires—what the world should look like when the war is over.

Tuesday  28 May  2013 / Hour 4, Block D: Hakim, in re:   The Peace Bridge (What Else?) Sets Off a Cuomo-Canada War  Gov. Andrew M. Cuomo’s handling of differences over the international bridge is giving the wider world a glimpse of how he often wields power.

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