- The Washington Times - Friday, February 8, 2008

ANALYSIS/OPINION:

Beltway angst

In Tony Blankley’s Wednesday Op-Ed column, “The strange GOP nominating victory,” he says: “Conservatives, such as Rush Limbaugh, worry (with good cause) that this fluke of Republican history might permanently deflect the course of the party away from conservatism.”

I find this ironic, as Mr. Limbaugh’s enthusiastic support of President Bush for seven years has helped make it acceptable to be a “moderate” Republican candidate (some might say liberal). I see little difference between Sen. John McCain and Mr. Bush; in fact, Mr. McCain may be the more conservative of the two. At least Mr. McCain understands that “cutting taxes” while wildly increasing spending does not really “cut’ them but merely defers them to the next two generations (which do not even benefit directly from the current spending of those monies).

Also, I believe McCain better understands the axiom that “Moderation in warfare is imbecility,” a lesson lost on Mr. Bush until the surge. Mr. Limbaugh’s angst no doubt stems in part from his own feelings of guilt in helping bring this “victory” about.

DAVID M. CUNEO

Wilmington, Del.

Brighten the economic picture

Congress can’t stand by and watch the nation’s housing markets and the economy continue to unravel (“Senate plan will delay tax rebates,” Nation, Wednesday). As a home-builder from California and current president of the National Association of Home Builders, I can tell you that the situation is serious.

We need immediate action to restore the health of our economy, and the place to start is by stabilizing housing and consumer confidence.

Fannie Mae, the Federal Home Loan Mortgage Corp. (Freddie Mac), the Federal Housing Administration and our tax policies offer powerful means for transforming today’s increasingly bleak economic landscape, and now is the time to put them to work in the stimulus bill being considered on Capitol Hill.

Allowing Fannie and Freddie to purchase higher-priced loans would restore the flow of mortgage credit in high-priced housing markets.

To make this effective, their loan limits should be raised for two years instead of one, and this authority should be tied to full regulatory reform of these institutions. Modernizing FHA would restore affordable home financing for first-time and moderate-income home buyers.

The mortgage revenue bond program can be expanded to allow cash-strapped borrowers to refinance adjustable-rate mortgages before those loans explode in their faces when the loans are reset at much higher interest rates.

Also, allowing businesses to carry net operating losses for five years would allow the job-producing engine of our economy to weather the storm.

There are times when Americans must look to their government to lead the nation back on the path to prosperity and hope.

Today is one of those times, and Congress cannot afford to squander the opportunity to rekindle the strength of our economy.

BRIAN CATALDE

President

National Association of Home Builders

El Segundo, Calif.

Remember to remember

The Feb. 1 editorial “Obama on the record” clearly lays out Sen. Barack Obama’s disturbing position on abortion. While Mr. Obama has been described by his supporters as “charismatic,” “a unifier” and “visionary,” another euphemism “humanist” is being used to win over anti-abortion voters to his camp.

Of course, the humanist label hardly alters anything, but his apologists have used it in novel ways to sugar-coat his pro-abortion stance. If he turns out to be the Democratic candidate come November, his regrettable position on babies surviving botched late-term abortions and his 100 percent rating from the Illinois Planned Parenthood Council certainly will be factors to bear in mind when entering the voting booth.

TESSIE PASA

Gainesville, Va.

Smoking and insurance

A simple but better way to pay for health care is to stop giving smokers the free ride they receive when insurance rates are uniform and nonsmokers are forced to bear most of the $140 billion annual cost (“How to pay for health care,” Commentary, Monday).

Forcing smokers to pay their share through higher health insurance premiums would be much fairer, is lawful under governmental regulations and would provide a very strong additional incentive for them to quit and thereby substantially reduce the costs of health care.

JOHN F. BANZHAF III

Executive director and chief counsel

Action on Smoking and Health

Washington

A crude awakening

Clifford D. May argues that if only government would require that all vehicles sold be flexible-fuel vehicles and give tax breaks for buying them, all our problems would be solved (“Energetic economics,” Commentary, Sunday).

There is nothing wrong with Mr. May’s rosy scenario except that he gets his facts wrong, doesn’t understand the way markets work and is hopelessly naive about the effects his policy might have on countries such as Saudi Arabia.

Flexible-fuel vehicles are sold for just $100 more than gasoline-only models because automakers that sell them receive valuable credits they can use to comply with Corporate Average Fuel Economy standards.

Thus, flexible-fuel vehicles already are heavily subsidized, which is why there already are millions of them on the roads. However, few people fill them up with ethanol (E-85) because it costs more than gasoline, even with the 51 cents per gallon refundable tax credit.

Ethanol’s higher cost is not likely to change for the foreseeable future simply because of the large inputs of diesel, gasoline and nitrogen fertilizers that are required to produce ethanol.

As a result of anti-energy legislation enacted in 2005 and 2007, the federal government already mandates the use of alternative fuels.

Using more ethanol could, as Mr. May asserts, lead to a very slight decline over several decades in the global demand for crude oil and thereby lower prices a bit.

However, he is wrong to think that lower oil prices, whatever causes them, would particularly hurt Saudi Arabia or Iran. Those countries are the world’s lowest-cost producers. If oil prices drop back to 2000 levels, this will lower the profits of all producers, but it will devastate the high-cost producers in Canada, the United States and Mexico.

Finally, Mr. May states that his scenario would protect national security. The argument behind this claim is that countries such as Saudi Arabia would have less money to propagate radical Islamic ideas around the world.

However, spreading radical Islam is a priority, and an inexpensive one, for the Saudi government. It wa doing it when oil was $20 a barrel.

Will governments in the Middle East or Venezuela be friendlier to us when the price goes back to $20? If Arab fundamentalists or Hugo Chavez pose serious threats to our national security, we should confront those threats directly rather than through goofy roundabout policies that are almost certain to harm Americans more than our enemies.

MYRON EBELL

Director

Energy and global warming policy

Competitive Enterprise Institute

Washington

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