When a protectionist law is enacted and nearly a century later it is inhibiting a recovery from major ecological catastrophe, it's probably time to scrap it or at least temporarily waive it.
But instead a nearly century old provision known as the Jones Act of 1920 is wielding the wrath of unintended consequences. According to the Heritage Foundation, this protectionist measure was put in place to defend the American maritime industry, but is endangering far more jobs than it is protecting.
"The Jones Act, which is supposedly about protecting jobs, is actually killing jobs," Heritage co-authors James Dean and Claude Berube wrote in a June 8 The Foundry post. "The jobs of fishermen, people working in tourism and others who live along the Gulf Coast and earn a living there are being severely impacted. There are also additional private sector jobs which are NOT being created in the United States since the Jones Act effectively prices U.S. based companies out of the ability to be competitive on the competitive global market. As we strive to develop new technologies for a cleaner environment at sea, the Jones Act continues to hobble our own capabilities, sometimes with devastating results."
With the Dow Jones Industrial Average (DJIA) taking another tumble of 376 points on May 20, some investors are pointing to problems in Europe for the sell-off. However, there may be problems at home as well.
"Well, a couple of things," Santelli said. Well, first of all, if you look at the high-grades, they widened out with the high-yields widened out more today at levels today that are wider than the day of the flash crash. That's ‘a.' And ‘b,' you know Maria, we have a 1.2511 on the Euro. This is so much more than just focusing on the Euro."
The European Union and the International Monetary Fund to the rescue! The Dow Jones Industrial Average (DJIA) soars and investors breathe a sign of relief. But where's this $1 trillion in bailout funds for Greece coming from?
"On one thing, Rick - because you started the whole thing where you said, ‘Are you listening, President Obama?' about paying for your neighbor's mortgage," Kernen said. "Are you, could you really tell the American taxpayer, you can connect the dots between them and Greece? I mean are they paying for some lavish benefits in Greece right now?"
While international attention has been focused on Greece's debt crisis and the riots that have ensued over austerity measures, the possibility of the United States finding itself in the same situation is one to be considered a legitimate possibility says CNBC CME Group floor reporter Rick Santelli.
On CNBC's May 7 "Squawk Box," host Joe Kernen pointed out the fear of contagion spreading throughout the world economy has been a focus, but asked Santelli if anything could be discerned from the Greek situation that would apply to the American economy.
"Well, you remember the Christmas Carol?" Santelli said. "You know, Greece is our Ghost of the Future. It's a future that doesn't have to be -- but if we don't make some changes in the here and now, we will ultimately end up not quite like Greece but let me tell you something austerity is not a GDP enhancer and I think a lot of what's going on with the issues in Greece are a lot like upside down mortgages. They tend to keep re-defaulting. I think it's not even the medicine. Austerity in a lot of countries isn't going to help the global economy. And I think -- I don't know how realistic people are being about the possibilities that it's just going to be tougher to create GDP over the next several years."
A $787-billion stimulus. Liabilities of $356 billion for the TARP bailout on the federal government's balance sheet. And that's in addition to other unfunded liabilities from federal entitlements like ObamaCare, Medicare, and Social Security.
But that doesn't mean the U.S. is heading down the path toward socialism because they were one-time expenditures, according to CNBC senior economics reporter Steve Liesman.
On CNBC's "Squawk Box" April 29, as jobless claims for the week was being released on the floor of the CME Group in Chicago, co-host Joe Kernen asked for Liesman's opinion.
Does anyone remember when the liberal intellectuals decried populism coming from the likes of Glenn Beck and other conservatives that was aimed at the direction the country is going under the leadership of President Barack Obama and the Democratic-controlled Congress?
Apparently it is OK to cry foul on so-called populist rants when the mouthpieces tend to be right-of-center. But now, with Congress debating financial regulation, this sort of above-the-fray approach has gone by the wayside, at least for Slate.com. On Slate's Political Gabfest podcast for April 22, moderator John Dickerson asked his panel consisting of Slate editor David Plotz and Slate senior editor Emily Bazelon, if Wall Street banks had a responsibility to self-regulate and do what's right as opposed to solely relying on legislation to set the boundaries. That inspired an "impassioned" populist response from Plotz.
The media is still having trouble understanding the Tea Party movement and what it is protesting, even though its roots are clear.
On Feb. 19, 2009 during CNBC's "Squawk Box," Rick Santelli made his famous rant heard around the world, calling for a so-called tea party-style revolt. And that helped fuel the growth of a Tea Party movement that has resulted in more than 600 protests this April 15, 2010.
Santelli's call for protest wasn't about high taxes. Instead, it was a cry against the Obama administration's plan for a taxpayer-funded mortgage bailout. The very beginning of the tea parties was about bailouts and the growth of government.
But the Associated Press still seemed to miss the point about worries over an overspending government in an April 15 article by Calvin Woodward about the Tea Party rallies. In that report, Woodward defended Obama's tax policies.
"Lost in the rhetoric was that taxes have gone down under Obama," Woodward wrote. "Congress has cut individuals' federal taxes for this year by about $173 billion, leaving Americans with a lighter load despite nearly $29 billion in increases by states. Obama plans to increase taxes on the wealthy to help pay for his health care overhaul and other programs."
A little over a year ago, President Obama signed into law the $787-billion stimulus legislation that was supposed to prevent the unemployment rate from exceeding 8 percent. And although the unemployment has receded some from its high, it's still well North of 9 percent. So if that stimulus is given more time, will unemployment improve?
Last week's jobless claims numbers, showing a stagnant unemployment rate of 9.7 percent, didn't provide any reason for optimism. And on CNBC's April 12 "Squawk Box," host Joe Kernen asked CNBC CME Group floor reporter Rick Santelli if this economic indicator is going to be stubborn number, which would confirm a failure of Obamanomics.
"Rick, I wasn't here last week when that claims number came out. But if I could really just dig deep down into your view, do you think a year from now we're still going to be talking about a stubborn unemployment rate, Rick?" Kernen asked.
With summer driving season upon us, it's important to note that there's a traditional jump in gas prices. But will this seasonal adjustment benefit commodities, specifically oil and make the price of gasoline even higher? That could happen if those forms of energy lure investment from what seems to be an over-valued equities market, brought on by what some claim is cheap money.
On her April 5 program, "Closing Bell" host Maria Bartiromo asked CNBC's CME Group floor reporter Rick Santelli if a move higher in commodities was due to inflation. However, according to Santelli, it's not inflation but a move by investors out of a potentially over-valued equities market that will cause a rise in commodities.
"Well, you know, I don't like to link the two together," Santelli said. "I mean, many times you know, it is core [minus] food and energy. So I think throw all that away. I think the better question is, is that when people are afraid to put their money to work in treasuries, because rates may be going higher, maybe afraid that we are a little long in the tooth in the sugar-buzz rally of equities - boy, commodities is the place to be. Most of the good dollar trades probably already out there."
Green jobs to save the American economy? If you have listened to the various politicos on the left end of the spectrum, especially before and after the passage of the $787-billion stimulus package earlier, you would think that is the cure-all.
But so far it isn't working and there are other fundamental problems that lie ahead according to some energy market analysts, like much higher oil prices - despite the pledge by President Barack Obama to open up 160 million acres for future oil exploration and drilling. To avoid the price of $100-plus oil, CNBC's CME Group floor reporter suggested expediting the process, as was the case with ObamaCare and TARP.
"I think what you're hitting on is so important because the President of course talking about some of these jobs, but also talking about drilling," Santelli said on CNBC's April 1 broadcast of "Closing Bell." "You know, if the government was able to put forth health care and the government was able to do bailouts and TARP and stretch the rules, if they wanted to get jobs now and avoid the $100-plus oil you know that's coming they could drill quickly if they wanted to. And this is something that needs to be discussed, don't you think?"
With March unemployment data to be released April 2, some are anticipating what potentially lower jobless numbers will all mean for the financial markets and the economy as a whole. However, that data will come with the caveat that it will be misleading because it will include temporary jobs driven by hiring for the 2010 census.
On CNBC's March 29 "Squawk Box," CME floor reporter Rick Santelli was asked how to interpret the expected improvement. He warned it isn't the kind of job creation that is good for a sustained economic recovery.
"You know, I think it's fascinating," Santelli said. "Most experts would agree, the kind of job creation we're going to see is welcome but it isn't the kind we need in the big picture. But having said that, yes, I think that the markets will act in a way that will show a robustness if the number comes in a couple of hundred thousand and I think it's kind of silly."
"Ah, the sound of angry white guys wafting its way through the airwaves," Moore said. "Obviously that was a pivotal moment for that, but if you notice what he's railing against is he's blaming the whole mortgage crisis on the little guy who took out a mortgage he shouldn't have taken out, living beyond his means, having a home with too many bathrooms, when in fact - as my movie points out - the FBI of all people, have stated clearly through their own investigation that 80 percent of this mortgage crisis that we've gone through has been caused by the banks and lending institutions, by the fraud committed by the banks and the lending institutions - not by the person who's living beyond their means."
Back on Christmas Eve of 2009, Obama's Treasury Dept. said it would lift the limits on what the federal government could provide in "emergency aid" to Fannie Mae and Freddie Mac - without seeking Congressional permission.
Very few reporters noticed, except for The Washington Post's Zachary Goldfarb who reported the story on Christmas Day and CNBC CME Group reporter and tea party inspiration Rick Santelli, who later pleaded for the public to take notice. With that occurrence in mind, Santelli scoffed at Sen. Chris Dodd's, D-Conn., legislative proposal of financial system reform that did not include reforms on both Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE).
"You know, I can't believe, first of all - you said, may not be included. They are not going to be included," Santelli said on "Fast Money" March 12. "And I think to put a moniker of reform on something that doesn't include Freddie and Fannie is very disingenuous. And I think that to pass something - what I heard Mr. Dodd say, Sen. Dodd, was, you know, it's the 101st senator. In other words, you know, we'll pass anything we have to show that we're doing something, no matter if it's the right thing or not, you know, I'm not buying that again."
On Feb. 19, 2009, one year ago tomorrow, Rick Santelli lost his temper while reporting from the floor of the Chicago Mercantile Exchange. The CNBC reporter was angry about bailouts of businesses and homeowners.
His passionate free market rant spoke to many Americans equally distressed about the direction of the nation. The Tea Party movement was born.
Rick Santelli is the star of perhaps the most politically consequential online video, viral to the extreme, of the past year (right). On February 19, 2009 he let loose on the Obama administration's economic policies on CNBC's "Squawk Box", calling for a "tea party", and inspiring millions of Americans to speak out against what he and many others see as collectivist economics policies pursued by the President and Congress..
“That was spontaneous, absolutely,” he said in an interview with the Daily Caller. “It was also from the heart, and I had no idea of the direction it would take or the response it would get.”
Almost a year later, Santelli is widely seen as the godfather of a large political coalition that, according to some polls, rivals the two major parties in popularity. The Tea Party protesters staged 48 simultaneous protests on tax day last year, a rally on the lawn of the Capitol with hundreds of thousands, if not millions of attendees, and will hold its own convention this week, with Sarah Palin giving the keynote address.
As the old cliché goes, you don't use a sledgehammer to crack a nut, but according to Rick Santelli, that's exactly what it appears the Obama administration is doing terms of financial regulation and fiscal discipline.
On CNBC's Feb. 2 broadcast of "Fast Money," host Melissa Lee proposed that taxing the wealthy is not the path to "economic prosperity and fiscal stability." Santelli, the network's CME Group floor reporter, agreed.
"Well, you're right," Santelli said. "But I also think you're going to see when the Bush tax cuts expire, a lot of middle class write-offs and exemptions and various tax benefits will also fall by the wayside. Not the least of which to mention, I have so many friends that work for the financial industry. And they've learned from the government, even if you only make $25,000 to $125,000 a year, one firm says if you leave to go into another job or whatever, anything outside retirement, they're going to keep 10-to-20 percent of the stock they took from you following the government's directives."
It's curious to see people in the mainstream media try to make sense of the Tea Party movement. The New York Times, which once called the Tea Parties a psychological phenomenon rather than a political movement, has now changed its tune.
In the wake of the stunning upset by Scott Brown in the Jan. 19 Massachusetts special election to fill the seat vacated by Ted Kennedy's death, the Times is attempting a more analytical look at the so-called "tea party tiger." Specifically, the Times looked at some key figures in the movement, Sen. Jim DeMint, former Alaska Gov. Sarah Palin, Fox News host Glenn Beck and CNBC CME group reporter Rick Santelli.
CNBC ‘Squawk Box' co-host Joe Kernen told Santelli about the Times story on Jan. 25.
While much of the national media was focused on a Christmas Eve Senate vote to pass health care reform legislation, the Obama administration's Treasury Department was tending to other business that will have serious implications for the U.S. economy. But did anyone notice?
As Zachary Goldfarb reported for The Washington Post on Christmas Day, the Obama Treasury said it would lift the limits on what the federal government could provide in "emergency aid" to Fannie Mae and Freddie Mac - without seeking permission from Congress. That led CNBC CME Group floor reporter Rick Santelli to ask if anyone noticed and/or realized what was really at stake with this move during the Dec. 29 broadcast of "Squawk Box."
It's often said markets function better when there is gridlock in Washington, D.C. because there's less of a chance for government will interfere in the private sector, creating a sense of security. But in this day and time, that theory applies to the U.S. dollar as well.
On CNBC's Dec. 17 "Squawk Box," CNBC Chicago Mercantile Exchange reporter Rick Santelli debated what was causing the recent rise in the U.S. dollar. Santelli, the original inspiration for the tea party movement, squared off with Jim Iuorio, CNBC "OptionsAction" regular and CME trader, about the cause - a weakened European economy or the place in the calendar year.
"So Rick, is the bigger deal right now on the dollar move - the risk-aversion trade because of the end of the year or because of the problems in Europe?" Iuorio said. "Or is it a combination of both? Which is the bigger thing, do you think?"
But it is also something that some in the financial media are reluctant to support, especially judging from the tone of CNBC "The Call" co-host Trish Regan and comments CNBC senior economics reporter Steve Liesman. On the Nov. 20 broadcast of "The Call," CME Group reporter Rick Santelli made the case that Federal Reserve should be audited. He cited opposition to the Fed audit proposal from Sen. Judd Gregg, R-N.H., which was based on Congress' inability to be fiscally responsible.
"He said, ‘You know, there independence is important to protect the soundness of the dollar,'" Santelli said. "Has he read any papers lately or looked at any charts? Come on. Amen, amen that this process is happening. They're not taking away their independence to make a decision on interest rates. We need to know where the money is going. I remember when Ben Bernanke faced committees of elected officials and said, ‘We can't audit the Fed because then you might look unfavorably on some of the counterparties we deal with. That's like finding paraphernalia under your kids bed and then not asking where he got it."
One of the issues debated among a panel consisting of Dobbs, host Larry Kudlow, former Clinton Secretary of Labor Robert Reich and CNBC CME Group reporter Rick Santelli on Nov. 19 was the issue of wage stagnation - which Dobbs blamed on outsourcing, immigration policy and technological advancement.
"I believe that the issue of unemployment in this country and job creation fundamentally will have to be taken on as a matter of government policy," Dobbs said. "It will also have to be taken on as a matter of business leadership. As to the idea that wages have been stagnant in this country for 35 year, point of fact, we have to understand what the causes are."
"[I] think we're building a stairway to heaven in Dow prices on the back of paper and I think that, you know it seems kind of dire to me that 8 percent - 8,000, 9 percent - 9,000, 10.2 - 10,000," Santelli said. "I shudder to think where the unemployment rate is going to be at 11 and 12,000 in the Dow."
Now that the Obama administration is attempting to take a victory lap on the U.S. economic recovery, claiming the $787-billion stimulus passed earlier this year was what did the trick, despite a cost of $160,000 per 'stimulus' job, as ABC's Jake Tapper pointed out, it has come at the cost of the U.S. dollar.
Since then, the stock market has rebounded nicely. The Dow Jones Industrial Average (DJIA) is off a March low of 6,547 points, even topping the 10,000-mark recently. But what has caused this nearly 50-percent jump? According to CNBC's Larry Kudlow - loose monetary policy by the Federal Reserve, with low interest rates, has made it possible for the markets to rise, with the 'loose' money going into the market.
"The funny thing is, Steven, it has gone into stocks - I mean the stock market guys ... there's no real multiplier for the economy, right?" Kudlow said on his Oct. 30 CNBC program. "But it has gone into stocks and the stock market crowd wants to see the Fed to keep pouring the money in no matter what happens to the U.S. dollar."
Not everyone at the NBC Universal umbrella of networks got the gag order memo about the Sept. 12 march on Washington, D.C.
Rick Santelli, who has been a target of the Obama White House and is credited with being the inspiration for the 2009 tea party movement, spoke out about how the media ignored the march. But, a year after the fall of Lehman Brothers, he was making the larger point that the government's intervention to thwart a financial crisis had been an ineffectual and potentially dangerous maneuver at the expense of taxpayers.
"I think this one-year anniversary is great, but I think it's great for another reason," Santelli said on CNBC's Sept. 14 "Squawk Box." "I think someday we'll learn that we didn't need to do very much, that time heals all wounds and you don't have to go broke in the process."
It's been nearly seven months since CNBC reporter Rick Santelli took a stand against the Obama administration, which inspired the tea party movement - and the White House hasn't forgotten.
White House Press Secretary Robert Gibbs was asked by CNBC Washington correspondent John Harwood why the administration decided to go after Santelli after his Feb. 19 call for a metaphorical revolt over President Barack Obama's economic policies.
"Truthfully, one primary reason," Gibbs said in comments aired on CNBC's Sept. 4 "Squawk on the Street." "And that was - I thought the argument that he was making was both disingenuous and not based on the facts. It was clear that Rick was very passionate about the issue. And look, we have differing opinions from both sides of the political aisle. It was clear to me that the argument that he was making wasn't based on him having actually read our plan."
When in doubt blame conservatism, even when it comes to the struggles of a media outlet - and ignore the possibility that liberalism might be to blame.
Ever since Nielsen came out with the July numbers for CNBC that showed the network had suffered a 28 percent ratings decline over a year ago, some of the financial media intelligentsia have been eager to point to what they perceive are the right-leaning political shortcomings of the network as a possible reason.
According to Daniel Gross, the Moneybox columnist for Slate.com and a columnist for Newsweek (and a known proprietor of "teabag" double entendres), there's been a decline in interest in financial news since the markets haven't been as volatile. But Gross is also convinced there's a component of the network's "rightward, anti-Obama tilt," despite its efforts to placate the left.
Why is CNBC's Rick Santelli one of the few press members willing to point out when the emperor isn't wearing any clothes?
As you ponder that important question, consider how Santelli on Tuesday morning recognized how absurd Vice President Joe Biden's Sunday comments were concerning the Obama administration misreading how bad the economy was.
After all, as Santelli marvelously asked: "How many hundreds of times has the current administration talked about the worst recession in history? The worst time since the Depression?"
Should it be the role of the government to determine what amount of risk is appropriate in the private sector? President Barack Obama could have been interpreted as suggesting that much in comments he made about TARP repayments on June 9.
CNBC's Rick Santelli responded to those comments earlier in the day from Obama, "that those who seek reward do not take reckless risks." Santelli said on CNBC's "Power Lunch" that it's not the role of the government to make those judgments.
"It makes me a little nervous and some of the people on the floor express this - whether it was the end of the last administration or the current administration, you know to really understand what's wrong and what needs to be right - that statement's very un-American," Santelli said. "You know, why should the government think they know the magic blend of risk and reward? It's the government's role not to fall asleep at the switch, not to have products that are unregulated and to have speed limits."
With the federal government issuing massive amounts of debt and the Federal Reserve purchasing it in the name of keeping interest rates down, questions have arisen about impact on the U.S. dollar.
On June 2, CNBC's "Power Lunch," aired a clip of the network's chief economics reporter, Steve Liesman interviewing Secretary of the Treasury Timothy Geithner. Geithner claimed the Federal Reserve wasn't monetizing the debt the government was accruing. Following that clip, CNBC's Chicago Mercantile Exchange floor reporter Rick Santelli, famous for inspiring the anti-tax-and-spending tea parties, questioned Geithner's denial of debt monetization.
"Well, you know the first part of that question was economists are worried about quantitative easing - are we monetizing?" Santelli said. "And his answer was no, we have a strong independent central bank. Now the latter may be true but it certainly isn't an answer to the question and I put forth, and I'd like feedback everybody - that quantitative easing can't exist without the monetization process. We issue debt; we print the money to buy it. That is monetizing. I can't believe that was his answer."
For whatever reason, CNBC keeps lining up challengers to take on its Chicago Mercantile Exchange floor reporter Rick Santelli over his self-reliance, pro-taxpayer persona - whether it's Steve Liesman, Arianna Huffington or this time, Keith Boykin - editor of The Daily Voice, a CNBC contributor and a BET TV host.
ON CNBC's May 7 "The Call," Santelli took on Boykin in the program's "The Call of the Wild" segment. Boykin was armed with the usual anti-George W. Bush talking points to defend President Barack Obama and his policies.
"Look what he inherited first of all," Boykin said.
"He didn't inherit anything," Santelli said. "He ran for office, it was his choice."