Obamanomics Update: Economy Shrinks By 0.7% In First Quarter

“Welcome To The Contraction”: Q1 GDP Drops By 0.7%, Corporate Profits Crash – Zero Hedge

And you thought the preliminary 0.2% Q1 GDP print from last month was bad. Moments ago, just as we warned, the BEA released its latest, first, revision of Q1 GDP (pre second-seasonal adjustments of course), and we just got confirmation that for the third time in the past four years, the US economy suffered a quarterly contraction, with the Q1 GDP revised drastically from a 0.2% growth to a drop of -0.7%: the worst print since snow struck, so very unexpectedly, last winter.

.

.
Incidentally, there has not been a US “expansion” with three negative quarters in it in the past 60 years.

Worse, the breakdown shows that far from being a non-core slowdown, consumption rose just 1.8%, below the 2.0% expected, and contributed just 1.23% of the bottom line GDP number. This was the worst Personal Spending contribution since Q1 of last year, when revised GDP dropped by -2.11%.

.

.
What is disturbing is that as noted before, inventories contributed the biggest component of Q1 GDP growth, adding $106 billion in nominal “growth.” Without that contribution, annualized GDP would have been worse than -3%!

.

.
And worst of all, was the plunge in corporate profits. According to the report:

Profits from current production (corporate profits with inventory valuation adjustment (IVA) and capital consumption adjustment (CCAdj)) decreased $125.5 billion in the first quarter, compared with a decrease of $30.4 billion in the fourth.

Profits of domestic financial corporations decreased $2.6 billion in the first quarter, compared with a decrease of $12.5 billion in the fourth. Profits of domestic nonfinancial corporations decreased $100.4 billion, in contrast to an increase of $18.1 billion. The rest-of-the-world component of profits decreased $22.4 billion, compared with a decrease of $36.1 billion. This measure is calculated as the difference between receipts from the rest of the world and payments to the rest of the world. In the first quarter, receipts decreased $28.9 billion, and payments decreased $6.5 billion.

Or visually, here was the third largest corporate profit crash since the financial crisis:

.

.
In short: welcome to the recession, which however will soon be double seasonally adjusted into another flourishing, of only stiatistically, “recovery.”

.

.

Former U.S. Marine Organizes ‘Draw Muhammad’ Contest Outside Islamic Community Center In Phoenix

Phoenix Bikers Sponsor ‘Draw Muhammad’ Contest On Friday – Breitbart

.

.
On May 29, bikers in Pheonix, Arizona, are holding a “Draw Muhammad” contest outside the mosque at the Islamic Community Center of Phoenix, which is where the two gunmen who opened fire in Garland, Texas, allegedly attended.

Nadir Soofi and Elton Simpson drove from Phoenix to Garland and opened fire outside of the Curtis Culwell Center on May 3, while a Muhammad cartoon contest was being held. The two men were quickly killed by police working security at the event.

In the weeks since that event, numerous media pundits have criticized Pamela Geller for organizing the Muhammad cartoon contest to begin with. At what she described as her freedom of speech and expression, pundits recoiled and said she was asking for it by allegedly antagonizing Muslims.

For example, following the attack, The New York Times said Geller’s contest “was not really about free speech. It was an exercise in bigotry and hatred posing as a blow for freedom.” The paper tried to explain that those who see it otherwise are confusing “hate speech” with free speech.

Enter former Marine Jon Ritzheimer, who is organizing Friday’s “Draw Muhammad” contest in Phoenix.

According to Vocativ, Ritzheimer says his contest is an exercise in free speech and is being held, in part, to respond to the “liberals” who criticized those gathered in Texas with Geller instead of criticizing the two Islamic men who walked up to a cartoon contest and opened fire.

He put it this way:

This is not about race or any other side agenda that the Liberals are making it out to be. This is purely 100% a Freedom of Speech Rally. Stand Tall and show that we can PEACEFULLY protest our rights that are under attack. That is the sole cause for this Rally and Islam wants to silence us.

Ritzheimer is also asking all attendees to exercise their Second Amendment rights and bring firearms in case the expression of a First Amendment right “comes under the much anticipated attack.”

The group is meeting at Denny’s by the Islamic Community Center at 5 pm and plans to walk to the mosque itself at 6 and hold the contest right outside. The current president of the center is Usama Shami. He responded to Ritzheimer’s announcement by saying, “Everyone has a right to be a bigot. Everyone has a right to be racist.”

.

.

Leftist Incompetence Update: Unfinished Prison Costs Detroit $1.2 Million Per Month

Liberals Built This: Unfinished Prison Costs Detroit $1.2 Million Per Month – Weasel Zippers

.

.
This is liberal control.

Via Fox News:

A prison in downtown Detroit that was deemed too expensive to complete is now a construction site frozen in time that still costs cash-strapped local taxpayers more than $1 million a month.

It was supposed to be a state-of-art lockup in the heart of the Motor City, but four years after breaking ground, with construction costs totaling $150 million and no end in sight, the city pulled the plug on the project four years ago.

Now, the Wayne County Jail sits empty among the ruins of a bankrupt city, costing taxpayers upwards of $1.2 million in debt service and monthly upkeep costs for electricity, security, sump pumps – and even off-site storage for pre-fabricated jail cells that will never be used.

Keep reading

.

.

Federal Court Deals Blow To President Asshat’s Executive Amnesty Scheme

Federal Appeals Court Deals Blow To President Obama’s Amnesty – Washington Times

.

.
A federal appeals court upheld an injunction against President Obama’s new deportation in a ruling Tuesday that marks the second major legal setback for an administration that had insisted its actions were legal.

The U.S. Court of Appeals for the Fifth Circuit ruled in favor of Texas, which had sued to stop the amnesty, on all key points, finding that Mr. Obama’s amnesty likely broke the law governing how big policies are to be written.

“The public interest favors maintenance of the injunction,” the judges wrote in the majority opinion.

Mr. Obama had acted in November to try to grant tentative legal status and work permits to as many as 5 million illegal immigrants, saying he was tired of waiting for Congress to act.

The full amnesty, known as Deferred Action for Parental Accountability, or DAPA, had been scheduled to begin last week, while an earlier part had been slated to accept applications on Feb. 18. But just two days before that, Judge Andrew S. Hanen issued his injunction finding that Mr. Obama had broken the law.

Administration officials had criticized that ruling, and immigrant-rights advocates had called Judge Hanen an activist bent on punishing immigrants. But Tuesday’s ruling upholds his injunction, giving some vindication to the judge.

It also could mean Mr. Obama will have to appeal to the Supreme Court if he wants to implement his amnesty before the end of his term.

In the 2-1 decision, Judge Jerry E. Smith and Jennifer Elrod ruled in favor of Texas, finding that the state would suffer an injury from having to deliver services to the illegal immigrants granted legal status, and ruling that it was a major enough policy that the president should have sent it through the usual rule-making process.

“DAPA modifies substantive rights and interests – conferring lawful presence on 500,000 illegal aliens in Texas forces the state to choose between spending millions of dollars to subsidize driver’s licenses and changing its law,” the judges wrote.

Judge Stephen A. Higginson dissented from Tuesday’s ruling, saying he would have left the fight over immigration policy to the White House and Congress, saying Mr. Obama should have broad discretion to decide who gets deported and how he goes about that.

Just Higginson also said the fight was a political battle, not a legal one

“The political nature of this dispute is clear from the names on the briefs: hundreds of mayors, police chiefs, sheriffs, attorneys general, governors, and state legislators – not to mention 185 members of Congress, 15 states and the District of Columbia on the one hand, and 113 members of Congress and 26 states on the other,” he wrote.

.

.

Ready For Another Obamacare Price Hike? (David Catron)

Ready For Another Obamacare Price Hike? – David Catron

.
………..

.
In July of 2009, as the Obamacare debate was heating up, Gallup published a survey indicating that 83 percent of Americans wanted health care reform to make their health insurance more affordable. Now, more than five years after the President’s “signature domestic achievement” was passed, health insurance premiums are higher than ever. And it’s obvious that Obamacare is a major driver of the increase. The Wall Street Journal reports that insurers are proposing rate increases ranging from 25 to 51 percent for 2016. Why? “All of them cite high medical costs incurred by people newly enrolled under the Affordable Care Act.”

Obamacare apologists suggest different causes, of course. Jonathan Cohn writes, “One reason could be the normal and predictable competition among insurance plans jostling for market share.” Cohn’s grasp of economics is so tenuous that he doesn’t know insurers compete for market share by reducing premiums. He also connects the increases to anxiety about that bête noire of Obamacarians everywhere, King v. Burwell: “If the court rules in favor of the plaintiffs… millions will drop their coverage because they will no longer be able to afford it.” Cohn evidently thinks insurers will respond by making insurance even less affordable.

The real reason for the proposed increases is that insurers now have real data on real Obamacare enrollees rather than implausible projections from the Obama administration. And this new information makes it clear that they’ll lose their shirts if they sell coverage at anything resembling 2015 rates. Many young, healthy individuals have refused to buy pricy Obamacare coverage, leaving insurance carriers with sluggish premium streams out of which to pay the large dollar claims coming in from seriously ill patients willing to buy coverage regardless of cost. This dynamic has already caused a number of health insurers to incur huge losses.

Obviously, not even an evil insurance company can stay in business if it consistently loses large amounts of money. Earlier this month, Assurant Health announced that losses related to Obamacare are causing it to close its doors. Western Journalism reports, “The company and industry watchers blamed its losses directly on the impact of Obamacare… Assurant lost $63.7 million in 2014. The insurer raised its rates by 20 percent in 2015, in hopes of returning to profitability, but lost between $80 to $90 million during the first quarter of this year.” The company has been in business for 123 years and provides coverage for 1 million people.

Assurant is based in Wisconsin, but insurers all across the country are attempting to survive the same perverse incentives that finally undid that venerable company. The Journal lists proposed increases by companies offering plans through exchanges in Connecticut, Indiana, Maryland, Michigan, New Mexico, Oregon, Tennessee, Vermont, Virginia, and Washington state. And many of these companies are already losing huge amounts of money: “BlueCross BlueShield of Tennessee… lost $141 million from exchange-sold plans, stemming largely from a small number of sick enrollees.” It is asking for a 36.3 percent rate increase.

All of which suggests that the “premium stabilization” safeguards ostensibly meant to prevent Obamacare from sending the health insurance industry into a death spiral aren’t working. The “reinsurance program,” as Philip Klein explains at the Washington Examiner, “slaps fees on insurance policies and uses the revenue to funnel payments to insurers to compensate them for taking on individuals with a high-risk profile.” “Risk corridors” are a corporate redistribution scheme whereby the government uses the profits of some insurers to offset the losses of others. But, as Klein points out, both programs will be gone after 2016.

If disasters like Assurant and BlueCross BlueShield of Tennessee are occurring while these programs remain in place, what will happen when they’re gone? Well, we’ll have more insurers proposing hair-raising rate increases in order to avoid the fate of Assurant. But, not to worry, says Charles Gaba at HealthInsurance.org, upon whom the erstwhile “Citizen Cohn” rather desperately relies upon as the voice of reason: “These requested rate changes are being submitted to the state insurance commissioner’s office… and in most states either the commissioner or some other regulatory body has to either approve the requests or deny them.”

In other words, some state bureaucrat may simply deny the insurance company’s rate request and impose a more “appropriate” premium. This means that, in New Mexico, Health Care Service Corp. may get a mere 25 percent increase rather than the 51 percent it has proposed. In Tennessee, Blue Cross may get only 20 percent rather than the requested 36.3 percent increase. In Maryland, the state bureaucrats may decide that, instead of a 30.4 percent increase, Blue Shield may only get 18 percent. All of these outcomes have one thing in common: The rate goes up by double digits. That means you pay a higher premium no matter how it turns out.

In other words, in the best case scenario, the your health insurance premiums are going up. And this is not simply because Obamacare has been unable to accomplish the main thing most Americans wanted from health reform in first place – more affordable medical care. Barack Obama’s “signature domestic achievement” is actually making health care less affordable. Good job, Mr. President. Please use the rest of your term perfecting your chip shot.

.

.

Putrid Leftist Alan Grayson Tweets ‘F*** The Police’ Photo

Rep. Alan Grayson Tweets Photo With ‘F*** The Police’ Graffiti – Big Government

.

.
Rep. Alan Grayson (D-FL) posted a tweet saying he opposes the militarization of police forces. His message contained a profanity. A photo attached to the tweet showed police officers wearing gas masks and holding weapons, standing next to a mailbox with graffiti that said, “F*** The Police.”

.

.
As he considers a run for the U.S. Senate in 2016, Grayson is no stranger to controversy. He is currently engaged in battles with both the leadership of his party, who have thrown their support in the Senate race behind Rep. Patrick Murphy (D-FL), and with his estranged wife and mother of his five children, who he is seeking to cut off from his estimated $26 million fortune.

Earlier this month, Grayson launched a profanity-laden tirade at another Florida reporter, saying that his story was s “a whole ‘nother level of bullsh**” and asking him if he was “some kind of sh**ing robot” who went around “sh***ing on people.”

.

.