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Not Giving the Best Worst Way To Ruin Economy By Charles Payne

"We can't expect our kids to do their best in places that are literally falling apart. This is America. Every kid deserves a great school — and we can give it to them."

-President Obama in Rose Garden yesterday pushing the American Jobs Act

So, we can't expect kids to do their best unless their schools have science labs, computers, and whiteboards. That stuff is nice to have, but to say we can't expect the best from our kids unless they're going to pristine-looking schools underscores the biggest problem with the nation today. There are too many excuses for failure. The notion here is kids in poorer schools should be forgiven for subpar grades even if it's more a function of subpar efforts on homework, subpar input from parents, subpar expectations in the community, and subpar use of tools for lesser results.

Don't get me wrong, I recently left the board of a charter school because of foot-dragging on a new building, but that's because the school shares a building with three other public schools. I wasn't worried about the physical structure as much as the mentality of children not in our school. This is classic victim pandering/creation that says everyone unemployed more than two years hasn't turned down a job considered beneath them or paying less than their benefits. Instead, everyone is a victim and should be coddled and pitied until they can get back on their feet.

I wonder if any of these great American writers went to schools with whiteboards and computers: Ernest Hemingway, John Steinbeck, Mark Twain, Tennessee Williams, Richard Wright, Maya Angelou, Edgar Allen Poe, William Faulkner, Herman Melville, Kurt Vonnegut, F. Scott Fitzgerald, or Walt Whitman. I know class size and snazzy electronic stuff helps, but to say we shouldn't expect great things from children unless they have that stuff is nuts. But, it's part and parcel of the narrative of fairness and it's supposed impact on our society, where subpar effort is expected, even considered noble. Instead of being a motivator, not having things is considered a good enough reason for not doing things.

This is absolutely backward thinking. I heard a commercial on the radio today for people on food stamps and WIC to get their free cell phone and 250 minutes of free air time. This is what some people consider social justice, but it's nothing more than another part of the victim trap that tells the recipient they deserve certain things simply because they have less than others while telling those that have even a modicum of success it's their role to pay up so others can get free cell phones. It's more a nail in the coffin of poor people in the sense their circumstances are made more comfortable and they believe others owe them something.

This victim syndrome seeks to snare more and more people into its net, hence the unyielding use of the word fair, and at the same time attempts to shame those that have the gall or audacity to pull themselves up by their own bootstraps. Of course we can expect our kids to do their best as their parents did without computers and their parents before them with fewer books and their parents before them who often learned by candlelight. What they all had in common was expectations to do their best. What they all had in common was a no excuses policy.

How do you look a ten year old kid in the face and say it's okay you are falling behind because you're school is old the desks are old and there are no computers?

Is this leadership? Is this how we fight back? Chinese kids are blowing American kids out of the water and it's not because they have better looking schools, as I'm sure they do not. They have a type of determination that is not only failing to be taught, but is being ridiculed, in America. I think every American kid should have a great school, but not having it should not be a cop out for not demanding they learn and excel. What the hell happened to the audacity of hope? There are parallel crises going on right now but the short and long-term are intertwined around things like spending and debt. The short and long-term challenges also revolve around education. Folks, we aren't prepared, and I can tell you right now telling kids it's okay not to be prepared will have disastrous results.

15 year old kids in Slovenia rank higher than American kids in math and science. We must demand our kids do their best and forget the pity party and victimization stuff.

Jobs Bill = Big Tax Bill

We knew it would come down to more taxes on those evil rich people, which is why Warren Buffett's name was invoked in that speech last Thursday. Of course, rich is a person making more than $200,000 or couples/families making $250,000 a year. It means small businesses that file as individuals. So, we are saying to them to not only hire people and raise wages but we are also hiking their tax bill, too? Brilliant stuff. It's all about politics and not economics. The tax hikes come mostly in the form of limiting itemized deductions and raising taxes on private equity firms. This is how to raise $467.0 billion over ten years:

$400 billion limit itemized deductions
$40 billion oil and gas tax loopholes
$18 billion adjust carried interest to regular rate
$3 billion on corporate jets
$6 billion misc.

It's really hard to believe anyone would think the transfer of money from successful people and small businesses to people that aren't working is going to give the economy a jolt that pulls it out of the ditch. This is another attempt at a good old fashioned money grab and vote grab.


A man is suing White Castle not because the food helped him grow to 300 pounds, but because he can't squeeze into the booths anymore.


This should be the poster for tort reform and the idea of victimization gone amok.

Yesterday's Session

Love the resolve of the market yesterday, but it's odd the final push came from rumors China is coming to the rescue in Europe. I think China has begun its move toward being the world's greatest superpower. It's buying all the gold it can get its hands on and in fact, Wikileaks documents outline how China believes America and the West have held down the price of gold to artificially bolster the value of the dollar. Those same memos hint that China wants as much gold as possible to eventually support the Yuan as the world's most important foreign reserve currency. Now, maybe, China is going to buy up enough Italian debt to help that nation get over the hump.

Today's Session

It's still all about Europe, where the morning has been filled with official statements and non-stop rumors. Angela Merkel made it clear the stakes are high and an "uncontrolled insolvency must be prevented" in Greece. In the meantime, there is an interesting thing happening with Best Buy (NYSE:BBY) shares this morning. The company reported earnings results that seem to be an unmitigated disaster. The shares dipped initially but are coming on strong into the open. A similar thing happened last week with Texas Instruments (NYSE:TXN). I wonder if these, coupled with intra-day rebounds, are signs the market is ready to stage a tradable rally.

I kind of think that's the message, that outside politics, stocks could trade much higher based on valuation.