Wednesday, January 20, 2016

Iowa Gov villifies Cruz

It is getting very real now.

Cruz is anti-subsidy and anti-mandate.  Subsidies warp the market.  Mandates divert product.  Iowa is a corn and soybean state.  Subsidies and mandates result in paying more for chicken, pork, beef.  We get fewer miles-per-gallon. We suffer the effects of debased currency as the give-aways are financed by running more debt.

The farmers have more money passing through their checking accounts but no more sticking around long enough to end up in savings.  The environment takes a beating as farmers are compelled to plow and plant right up to the center of the gravel road.

The middlemen and the suppliers of ag chemicals, seeds and equipment are making bank.  And so are the politicians who benefit from the suppliers' good fortune.

It really does not matter which state holds the primaries first.  Everybody has skin in some game.  Modern politicians cannot get elected without big money behind them.  Only people who can be bought can play the game at the higher levels.  Cruz threatens everybody's rice bowl.

And that is why he has a chance.

The Chrysler loan/rescue in the very early 1980s succeeded because it was "everybody in".  It did not matter if you had loaned a plant in rural Illinois $5000 to repaint the lines in the parking lot.  The deal was off until EVERYBODY agreed to the same hair cut.  As a bank president, you might drag your feet wondering why you should disadvantage your shareholders and customers.  You wondered until the president of Manufacturers Hanover called you up and reminded you that your bank could not function if you were frozen out of the credit markets.  Every once in a while even the best run banks need a few dollars to cover a shortfall until a deal goes through.

Cruz's theme is to peel all the subsidies and mandates away.  Cherry-picking is doomed to fail because it is business as usual; Picking winners and rewarding them, picking losers (typically industries that did not support your party according to the levy) and punishing them.  Nope.  Kill them all and let the market demand the ones that really make sense.  It is a very short list.  Perhaps some preventative health measures (neonatal, vaccinations) heavy infrastructure and the military.

The fact that Iowa Governor Terry Branstad considers Ted Cruz a disaster is evidence that Senator Cruz will not roll over and "deal".


  1. Aah, the Chrylser baliout. Chrysler was never going to fail, but the bailout was a huge bait-and-swtch to explain how important the company was to America. I should have bought Chrysler stock wthen it was selling for $3.00 per share. I'd be a multi-millionair now.

    But, Chrysler was never going to fail. The M1 Abrams, that coincidentally came on-line that year. I was on active duty at the time and our old M60 generation tanks were about worn out. We knew that the contract for M1 tanks was coming on-line.

    Chrysler did well, because everyone was on board, the unions took a huge hit, and Iacocca paid back all the money amd made Chrysler profitable again. The M1 tank contract played a big part in that.


    Ideologs carry a lot of baggage. He could be trouble.

  3. Yep, it's a question of who scares folks more... One that won't deal (Cruz), or one that doesn't need money (Trump). Either one upsets a whole bunch of applecarts!


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