Enable Wifi on Wandboard Quad Ubuntu 14.04

There are no clear instructions for enabling the Broadcom wifi chip in the Wandboard Quad. What follows is an aggregation of information stemming from the research I did to get the chip working on my board.

What I’ve learned

The Wandboard Quad uses the 4330 chip, unlike the other Wandboards that use the 4329 chip. I found some instructions for Debian and Ubuntu on the Wandboard, but between the different chips and firmware, it was difficult to piece together.

You have to download the nvram.txt file for the Broadcom chip separately. Why it is not included in the images, I don’t know.

Ubuntu 14.04 disk image

I have a Wandboard Quad purchased in Oct 2014. I am running this image:


from this Web site:


The bottom line is that it was far more stable than the image on the official Wandboard site.

Enabling the Broadcom Wifi chip

Once I cobbled together the info, it was actually a piece of cake. You have to download the nvram.txt for the 4330, and then make symbolic links to the proper files so they are found on boo. You also have to create a config file (wpa_supplicant.conf) with your ssid and password:

sudo wpa_passphrase myssid mypassprase > /etc/wpa_supplicant.conf
cd /lib/firmware/brcm
sudo wget https://github.com/Freescale/meta-fsl-arm-extra/blob/master/recipes-bsp/broadcom-nvram-config/files/wandboard/brcmfmac4330-sdio.txt
sudo ln -s bcm4330_nvram.txt brcmfmac-sdio.txt
sudo ln -s brcmfmac4330-sdio.bin brcmfmac-sdio.bin
sudo reboot

Configure your Wifi interface
Now just go to /etc/network, open your favorite editor, and edit the “interfaces” file:

sudo nano /etc/network/interfaces

Then configure the wlan0 interface like normal:

# wireless network interface
auto wlan0
iface wlan0 inet dhcp
wpa-conf /etc/wpa_supplicant.conf

You can test by entering:

sudo ifup wlan0

Letter to the FCC in regards to their Net Neutrality proposal

To the FCC,

Your new rules as written do not provide solid consumer protection or any guarantee of an open Internet. To the contrary, cable and telcos (ISPs) are duopolies or monopolies in most areas of the country and have already shown a propensity for charging ridiculous prices with onerous terms under one-sided contracts.

For example, I run a small business with 2 sites. Last winter Time-Warner Cable, with whom I have a business Internet account, called to tell me that they were lowering my bandwidth, doubling their prices, and requiring a one year contract. I had 48 hours to agree to these terms or my service would be disconnected. I half expected to see a leg-breaker with a baseball bat show up at my door. Time Warner is the only provider at this location, so I had no choice but to comply.

ISPs bemoan that use of services by providers such as Google, Amazon, and Netflix use too much bandwidth, but those companies aren’t getting a free ride. They pay millions of dollars a year for infrastructure and bandwidth. The consumers that use their services are likewise charged monthly per contracted level of bandwidth by the ISPs. Consumers are already getting short changed, as the ISPs do not provision for full use by all concurrently. For example, although I might pay for 30Mb/sec of bandwidth, as do my neighbors, if we all attempt to download large files at the same time we will find that the “pipe” that we share is not large enough to allow us the bandwidth for which we pay.

The ISPs claim that because consumers are using bandwidth to watch, for example, Netflix that Netflix must pay them as well. This is not only double dipping, it is actually using the fact that they oversell bandwidth to their customers as an excuse to lobby for payment for traffic priority by providers. This is outrageous.
The oft quoted “fast lane” is a canard. The ISPs aren’t going to invest in a separate “fast lane”. They are going to use Quality of Service bandwidth shaping to prioritize traffic if paid by a service provider, at the expense of other traffic. So if the same group of neighbors all try to download at the same time, but one is watching Netflix (and Netflix pays the ISP for priority), the movie watcher’s data stream will be unaffected. The others suffer.

If the FCC approves this plan as written it will be to the benefit of some of the largest corporations in the country, companies that rank annually at the bottom of customer satisfaction surveys, at the expense of consumers and small businesses.

The FCC should be going in exactly the opposite direction; endeavoring to encourage competition and discouraging price gouging.

Richard Bross

Move your Linux installation to a new Solid State Drive – even a smaller one

Solid State Drives (SSD) are all the rage these days – and for good reason. They are fast, silent, and have no mechanical parts to go wrong (although firmware bugs can and do bite people).
They are also horribly expensive. For this reason many people who take the plunge buy drives that are smaller than the mechanical drives that they are replacing. This can be a problem. If you are moving to a larger drive, Clonezilla or other imaging programs do a fine job, but moving to a smaller drive can be daunting. If you do a Google search there are articles all over the Web that will give you bits and pieces of advice. The following is a procedure that I know will work, because I just moved my installation from a 300GB hard drive to a 240GB Intel 520 SSD.
First things first – preparation
First of all, make sure that all your data will fit on your new drive. No article in existence can explain how to fit 400GB of data onto a 200GB drive. So check out how much space you are using and start housecleaning. Remember that you want to have some free working space as well.
Second, back up your drive. I said BACK UP YOUR DRIVE! Better yet, download a copy of Clonezilla and image it. Then you can recover from even the worst screwup by restoring the image. Clonezilla, learn it, love it, live it.
Finally, your /etc/fstab file should be using UUIDs instead of device ids to identify drives. Open /etc/fstab, and if you have entries that look like this:

/dev/sda2 / ext4 defaults,errors=remount-ro 0 1

instead of this:

UUID=ec9de201-c1f1-44d1-b398-5977188d4632 / ext4 defaults,errors=remount-ro 0 1

Then start Googling until you can boot with UUIDs. Although I won’t cover the difference between device designations and UUIDs in this article except to say that the reason for using UUIDs is that the device IDs and partition numbers on the new drive may not match the old ones, so fstab could be incorrect. Once you can boot with UUIDs, we are in a position to assign new drives the same UUIDs as the old drive had, ensuring that fstab will not have to be edited.
Create and copy your partitions
For this part you will need a Linux Live CD or USB flash drive. Hopefully, you already have one handy in case of emergency. Boot from the live CD or USB flash drive. Attach the old and the new drive to the system.
Ok, here we go.
To copy partitions:
1. Partition the new drive. If you have “/boot” and “/” partitions on the old drive, create them on the new drive.
2. Format the partitions with the same file systems as the old drive partitions.
3. Boot from a live CD or USB flash drive
4. Open a terminal
5. mount the partitions from both the old and the new drives (use “sudo blkid” to see the devices and partitions).
6. For each partition, run:
sudo cp -afv source_mount_point/. destination_mount_point
So for example:

sudo cp -afv /mnt/old_drive_boot/. /mnt/new_drive_boot

7. run “sudo blkid” and make note of the UUIDs of the old drive (open text editor and copy and paste from the terminal).
8. Unmount the old drive partitions (“sudo umount MOUNT_POINT”)
9. For each partition, set the GUID to match the ones on the old partitions:

sudo tune2fs -U UUID /dev/sdXX

10. Turn off your machine, remove the old drive and boot from the Live CD/USB again.
11. Follow the next section derived from http://zeasite.com/blog

Install GRUB2 to your new drive
1. In Terminal type

sudo fdisk -l (or "parted" and "list" if you are using GPT instead of MBR)

2. Mount the / partition drive

sudo mount /dev/sdXX /mnt

(example ‘sudo mount /dev/sda11 /mnt’ ,don’t miss the spaces.)
3. Only if you have a separate boot partition:

sudo mount /dev/sdYY /mnt/boot

4. Mount the virtual filesystems:

sudo mount --bind /dev /mnt/dev
sudo mount --bind /proc /mnt/proc
sudo mount --bind /sys /mnt/sys

5. To ensure that only the grub utilities from the LiveCD get executed, mount the /usr directory:

sudo mount --bind /usr/ /mnt/usr

6. Ok, now we can chroot onto the new drive.

sudo chroot /mnt

7. Ensure that there’s a /boot/grub/grub.cfg


8. Now reinstall Grub

grub-install /dev/sdX

(eg. grub-install /dev/sda – do not specify the partition number.
9. Verify the install

sudo grub-install --recheck /dev/sdX

10. Exit chroot : CTRL-D on keyboard (or “exit”)
11. Unmount virtual filesystems:

sudo umount /mnt/dev
sudo umount /mnt/proc
sudo umount /mnt/sys

12. If you mounted a separate /boot partition:

sudo umount /mnt/boot

13. Unmount the LiveCD’s /usr directory:

sudo umount /mnt/usr

14. Unmount last device:

sudo umount /mnt

15. Reboot.

sudo reboot

16. After you successfully reboot, make sure that you change fstab and other files to tweak your system for your new SSD:
Enjoy your new SSD!

How I Used a Pellet Stove and a Smart Fan to Eliminate Heating Oil Costs

Home heating costs in northern New England with fuel oil
In part 1 of this series we will look into the problem of energy costs in cold climates (in this case New Hampshire) and how a pellet stove can be used to reduce or eliminate that cost.

When most people around the country think of New Hampshire, the first thing they usually think is “cold and snow”. And from October until May that’s a pretty accurate picture. It gets really cold – and really expensive.
Over half of the homes in New Hampshire use heating oil to heat their homes, including us. My house is a bit over 3000sf. We are fully insulated and I have programmable thermostats in 4 zones. They are programmed with the following profiles:
Weekdays, 5am – 7am, 69 degF
Weekdays, 7am – 4pm, 64 degF
Weekdays, 4pm – 9:30pm, 69 degF
Weekdays, 9:30pm – 5am, 64 degF
Weekends, 6am – 10:30pm, 69 degF
Weekends, 10:30pm – 6am, 64 degF
Of course when the temperature outside is about 25 degF or less, the floor tends to be quite a bit cooler than the chest high height where the thermostats are mounted. This necessitates sweaters and long sleeves. Not horrible, and we’re sure not wasting energy. I also have a wood stove in the cellar that heats the floor. Although a bit of a pain, it greatly reduces our oil usage on frigid days.
In an effort to save more, we replaced our 18 year old furnace in 2007 (which burned efficiently but was “stupid”. A simple thermostat kept the water at a high set temperature for our forced hot water heat.) At a cost of around $8,000, we installed a Weil-McLain “smart” furnace. It has a control panel that sets the water temperature based on a combination of outside temperature and heating demand. We paid extra for an option that maintains a separate hot-water tank and heater for tap water. It cut our oil use by 30%. But it couldn’t control the price of oil. The result? Our 2010-2011 winter season oil bills totaled $3,373,49, or around $550/month for the late fall to early spring. Here’s a sampling of our oil cost for comparable periods in prior years:
2004-5 $2,285.47
2005-6 $3,861.05 (oil price spike)
2006-7 $2,920.91 (new “smart” furnace installed mid season)
2010-11 $3,373.49 (oil price spike).
As you can see, regardless of all the energy saving steps we have taken, we are still at the mercy of the volatile oil market. At the time that I write this residential home heating oil costs around $3.50/gal. We average about 200-300gal/month during the winter season, so I am looking at heating bills of $700-$1000/month during the 2011-12 season; $4000-$5000. I simply can’t afford that.
Here is a chart of oil prices from 2000-2010. If the chart went to 2011 you would see another spike up to 350 (cents).
I looked into every alternative energy technology I could think of; wind, solar; geothermal. They were all very expensive, achieved at best modest gains, were high maintenance, and the payback period varied from 15-30 years. As Dr. Evil would say; Riiiiiiight!
Enter the pellet stove
True innovations come in surprising forms. At first glance, you may think that a modern pellet stove is the result of the availability of super-cheap microcontrollers. They allow the stove to increase and decrease the fire based on a combination of air flow and pellet feed rate. They also control a fan that blows through heating tubes to blast hot air into the room. Cool. But if you think about it, the true genius was the person who decided to take wood waste and transform it into a medium that could be conveniently delivered, doesn’t require chopping and splitting, and allows the homeowner to load a hopper every other day. Try doing that with logs!
So after calling a number of vendors, I purchased a Regency Greenfire GFI55 insert for the fireplace in my living room from All Basics Stove Shop in Merrimack, NH. Short story; I love it. This stove is “smart” and runs great with a thermostat attached.
I connected a Lux TX500E, the same type of programmable thermostat that I use for my oil heat. This allows the pellet stove to fire up early in the morning and blast away for an hour, and then to lower itself to a comfortable temperature.
Pellets are about $200-$250/ton, which is 50 40lb bags. A bag will last from 24-48 hours depending on how much the stove runs.
Go to most homes where a pellet stove is installed and you see two common situations. Either they want to heat a lot of the house, so the room with the stove is 80+ degF and you want to take a swim. The other alternative is that the room with the pellet stove is the only comfortable place in the house.
And that points to the pellet stove’s biggest shortcoming as a whole house heating system; airflow.
Using a pellet stove as a home’s primary heat source
What I really wanted was a way to distribute the pellet stove’s intense heat throughout the house. Depending on your home’s floor plan, strategic placement of the stove is essential. You want to install it in a room that is close to the center of the house. As it happens, my house has a perfect floor plan for a pellet stove. It is a traditional New England home of a type know as a “hip roof colonial”. Basically it is a two story cube with a central stairwell. I installed the pellet stove in the living room and then put a pedestal fan (so the blades are 4 feet high) in the doorway to blow the hot air into the middle of the house. The air rises to the second story and spreads through most the whole house.
This is a Lasko 18″ 3 speed remote controlled fan for around $38 at Home Depot.
So the concept works, but now the fan either has to run 24×7 or you have to constantly control it with the remote control. I wanted “set it and forget it”.
Fully automated, the simple way
An easy way to automate a manual fan is to simply plug it into an outlet thermostat, like the Lux WIN100.
Warning; if you decide to use this method do not buy a remote controlled fan! When a remote controlled fan is unplugged and then plugged in, it won’t come on until the power button is pressed, useless for control by an outlet thermostat which cuts and restores power to the plug. Instead get a simple fan like this instead.
Ok, so now when the room heats up your outlet thermostat turns on the fan. This works quite well and is far more efficient than either heating the room to tropical temperatures or leaving a noisy fan running 24×7.
At this point we’ve achieved “efficient”, but what if we want super-efficient, fully automatic, and Web control? Geek alert! Read on.
The pellet stove has a microcontroller and a thermostat, why not the fan?
As mentioned above, I bought a 3 speed, remote controlled fan. It’s not like I had a choice. I went to 2 Home Depots, a Lowes, and a Wal-Mart and it was the only pedestal fan left at any of those stores.
Since I couldn’t use the outlet thermostat on a remote controlled fan, it looked like I was stuck. Nope. Being an inveterate tinkerer, about a year ago I asked my wife and daughter to buy me a microcontroller and network card to play with. For those of you who have never heard of “Arduino”, it is an open source, super cheap microcontroller with lots of variations and modules. I got a clone called a “Seeeduino” that costs $22. Arduinos have digital inputs and outputs as well as analog inputs. They can communicate with the world in a variety of ways. For more information, check out the project page.
My goal for this project was:

  • Turn the fan on and off when the room exceeded or fell below a set temperature.
  • Increase and decrease the fan speed in steps as the room temperature rises and falls to disperse the heat throughout the house.
  • Be able to override the controller without dealing with wall plugs.

The result is a tiny box that controls the fan via it’s remote control codes.
It has an embedded Web server and any household member can bring up the page and change the settings.
It can learn the fan remote control codes by simply pointing the remote at the controller, pressing a button, and then clicking either “Learn Power” or “Learn Speed”. As you can see, it has three temperature settings which correspond to fan speeds of Low, Medium, and High. When the temperature falls below “Low”, it turns the fan off.
The result is super efficient. The pellet stove thermostat is set to 77 degF early in the morning when the house is at its coldest. The fan slowly ramps up as the temperature in the living room increases and blasts hot air into the rest of the house. The thermostat then settles down to 68 at 7AM, which keeps the rest of the house at about 65. On weekends it is set for 74 during the day, which keeps the rest of the house at a comfy 70. In addition, my pellet use has been cut by around 30% as the fan works in perfect harmony with the stove to achieve peak efficiency.
I estimate that I will go through a ton of pellets (50 bags) an average of every 70 days throughout the heating season. That totals 3 tons, possibly a bit more. I buy clean burning pellets which are a little more expensive at $250/ton, so my cost will be between $750-$1000 for the entire season. The oil heat has never fired up since I completed this system. We keep the oil heat thermostats at 62 so they will kick on if we are away from home for an extended period of time or if the stove were to have a problem.
The pellet stove was $3500 installed. It will pay for itself in one heating season (with some pretty nice nights out to spare). Mission accomplished.
In future articles, I’ll describe the hardware components, how I built the controller, and also discuss the software that I wrote to run it.

Please tax me! Wealth vs. Income.

Please tax me! Wealth vs. Income.

For years, we have been hearing from Democrats that we should raise taxes on “the rich” and “millionaires and billionaires” to help offset the world record spending going on in Washington. Most readers are probably familiar with the tired arguments tossed around ad nauseum by the talking heads on television. One side posits that “the fortunate should pay their fair share”. The other side responds that the top 10% of taxpayers in the US pay 73% of income taxes collected. The left says that higher earners can afford an increase. The right responds that those higher earners are small businesses and job creators, and raising their taxes will depress hiring. Even multi-billionaires like Warren Buffet and Bill Gates have gotten into the act by advocating for higher taxes, saying that “people like them” can afford to pay more.

The problem with this debate is that no one ever challenges the initial premise that higher rates are targeted at “the rich”, which is usually defined as those with a family income of around $250,000 per year. Are these families “rich”? Are they “wealthy”? Do they warrant being lumped in with Warren Buffet or Bill Gates? (Ok, that’s a bit unfair; do they warrant being lumped in with your local entrepreneurial car dealer?).

No, they are not rich and they should not be categorized as such. Warren and Bill are being incredibly dishonest to suggest that they would somehow be affected by an increase in income tax rates of any size. True millionaires and billionaires have wealth, which is completely different from income. Warren and Bill each have $50 or $60 billion in assets; cash, stocks, bonds, investments, etc. None of their assets would be touched by higher income tax rates. If you have $60B dollars in the bank, what possible effect would it have on your lifestyle and your family even if the government took 100% of your income? On the other hand, if you are a cop and a schoolteacher in New York City with 3 kids and a family income of $300K, you have to pay your bills, save for retirement, and put those kids through college. That’s a monumental challenge, especially if you (like most people) started with nothing and are trying to build a nest-egg. Even if our sample family lived in Fargo, ND, it would be a big challenge to support the family, save $160,000 (after taxes) for each college bound child ($480,000), and also save for retirement. Federal, state, and local taxes, as well as Social Security and Medicare are already taking close to 40% ($120,000), leaving this family with $180,000 year. Nice income, but hardly one that allows a Bill Gates-type lifestyle. Furthermore, when our sample family sends their kids to college, they will find that because they have a good income and have been responsible enough to save, they don’t qualify for grants or low interest loans. They will have to pay 100% of the cost, helping to subsidize other students.

The next time I see billionaires on TV suggesting that they are willing to pay higher income taxes, I would love to be able to respond by proposing a tax that truly targets the rich. How about a wealth tax” on all assets over $1,000,000? Really, does anyone need more than a million dollars when so many are suffering? Once a family reaches millionaire status, everything else goes to the government. (BTW, confiscating 100% of the wealth of the 2010 Fortune 400 wealthiest wouldn’t even cover the deficit for a single year. Don’t take my word for it; here is an article from the World Socialist WebSite that puts that total at $1.37 trillion. Then what do we do next year?) That makes a lot more sense than taxing income, which is a tax on producers.

For anybody who thinks that I would truly suggest that the government confiscate somebody’s assets, it’s time to go home to Venezuela, Hugo. Oh, wait a minute. We do have a tax that confiscates a family’s wealth; the estate tax! Also, I can’t tell you how much enjoyment I get out of quoting the World Socialist WebSite to support a conservative position.

Americans are yearning for a leader

I, like many Americans, am sick and tired of politicians telling us what they think we want to hear, or echoing the latest polling data, or changing their message depending on which group they are talking to.

The great leaders in our past had strongly held beliefs. They might have changed those beliefs if warranted as new facts came to light (to not do so would be pigheaded and ignorant), but they did not change them to please the electorate.

If I were to “create” a leader for 2011, he or she would not give speeches to explain how government programs could be created or modified to help me. He would reaffirm the uniquely American principles of self-reliance, discipline, persistence, and courage. He would inspire us and remind us of our heritage.

In other words, he would kick us in the ass and say; “You’re Americans! Why the hell are you waiting for Washington to fix your problems for you? Get off of your collective asses and get to work! I’ll do my part by getting Washington off of your back.”

Or to put it more in terms of a political speech, it would go something like this:

“Americans are heroic because, unlike other societies, we believe in a system of government that forces us to fend for ourselves, risking failure and hardship in order to achieve our dreams. Other nations ask less of their citizens. They promise security and freedom from want, and in an attempt to fulfill this empty promise they stifle the few with the drive and intelligence to move society forward, those with the will to continue to strive for excellence and achievement in the face of ever-increasing regulatory and confiscatory barriers.  If Americans wish to be the nation of our forefathers, a nation of strivers and dreamers, we must be willing to accept failure as the inevitable companion to success. If we eliminate the potential for failure, if we short-circuit the relationship between risk and reward, then “success” no longer has any meaning and we become just another decaying society living on our past glories.”

I wait.

Why Conservatives Should Not Support Christine O’Donnell

Anyone who’s read one of my previous posts probably has me pegged; I was a staunch constitutional conservative with a libertarian bent long before the Tea Parties surfaced, as evidenced by this article from 2006, explaining why the Republican party was losing conservative support.
So based on her stated positions, I should be an ardent supporter of Delaware Republican Senate nominee Christine O’Donnell, correct? In a word, no.
For years conservatives have been bemoaning the lack of public concern for the character of political candidates, and Christine O’Donnell has very serious character issues.

  • She failed to pay federal income taxes, leading to a lien against her home and eventual foreclosure.
  • Although claiming to be a graduate of Farleigh Dickinson University, she failed to pay off her debts until last August, when she was finally awarded her degree 12 years after she finished classes.
  • At 41 years old, she doesn’t appear to have ever had a career of any sort other than running for the United States Senate (3 times in the last 5 years).
  • In 2005, she worked for a short time at the Intercollegiate Studies Institute, a conservative non-profit. She then filed a $6.9M lawsuit for “gender discrimination”, which she later dropped.
  • As reported in the Weekly Standard, the lawsuit alleged that she tried to take graduate level classes at Princeton and lost the potential for increased earnings when she lost her position. She later acknowledged that she never took any classes at Princeton.
  • Statements by a former campaign worker indicate that O’Donnell used campaign donations to pay personal bills. Although these are just allegations at this time, in light of her record they are eminently believable.

Of course there are also a number of mildly disturbing videos from her past in which she decries masturbation as a sin and admits to being involved with witchcraft (among other things). At best, like many young adults, O’Donnell may have been restless and searching to find her identity. The problem is that she doesn’t yet appear to have passed through that phase of her life.
Ms. O’Donnell was scheduled to appear on a number of Sunday morning political talk shows on September 19th but she canceled, giving “exhaustion” as a reason. Given the serious issues about her candidacy, she should have rested up and faced the music – but really, what could she say that would help? The salient fact is that she made commitments and then backed out as soon as it looked like the going would get rough.
Does it really matter if she is a conservative or a liberal, a Republican or a Democrat, endorsed by the Tea Party or supported by the Daily Kos? Given her personal history, would you hire her for any position? At the age of 41, she has shown no evidence of responsibility, trustworthiness, work ethic, persistence, veracity, or leadership. Which makes her, perhaps, the perfect model for a United States Senator in 2008, but this is 2010.
For those conservatives who say “Delaware Republicans have a right to select any candidate that they wish”, allow me to echo the conservative reply to the Ground Zero Mosque controversy; I am not questioning whether or not they have the right, I am questioning the wisdom of their choice.
One of the foremost principles of the Tea Parties, and one that I promulgated back in 2006 in the aforementioned article, is that party affiliation is a moot point if the candidate does not reflect the voter’s principles. This applies to Republicans and Democrats. But above all it should apply to candidates endorsed by the Tea Parties. The Tea Party movement is supposed to be based on an adherence to principle above all other considerations. Christine O’Donnell’s candidacy is the perfect opportunity for the Tea Party movement to prove that they’re willing to admit when they’ve made a mistake.

A Dangerous Precedent – Is This Still the United States?

Regardless of your politics, Health and Human Services Secretary Kathleen Sebelius’ September 9th letter to the health insurance lobby is chilling. Because a few health care companies had the temerity to attribute a portion of their rate increases to Obamacare, Sebelius has threatened that the federal government will go after them:
“There will be zero tolerance for this type of misinformation and unjustified rate increases. Simply stated, we will not stand idly by as insurers blame their premium hikes and increased profits on the requirement that they provide consumers with basic protections.”
She warned that companies that did not toe the administration line would not be able to participate in the insurance exchanges that will be formed in 2014 from those citizens forced to buy individual insurance. The exchanges are the only part of Obamacare that could offset some of the cost increases resulting from the requirements that health insurance companies cover preexisting conditions, cover young adults to the age of 26, and other expensive mandates.
This is no longer simple demagoguery; it is the overt use of government power to repress oppositional views. It is totalitarianism. This type of behavior is unacceptable and un-American whether you are a Democrat or Republican, a Liberal or a Conservative.
Sebelius’ assertion that attributing part of the rate increases to Obamacare is “misinformation and unjustified’ is simply that; an unfounded assertion. She has no evidence whatsoever to support her claim. The idea that forcing a health insurance company to accept customers with preexisting conditions will not have a cost is so economically clueless that it is frightening. But even if Sebelius were absolutely correct, under what law can the Federal government dictate to private companies what they can and cannot publicly state as their justification for a price increase? This is ground that is not covered by the SEC or the IRS. This is First Amendment repression – Hugo Chavez style.
If you are a Democrat or Liberal, you should be just as outraged by this precedent as anyone else. When the next Republican administration enters office, it could be a company or organization that you like that is next, not one that you hate.
Totalitarianism doesn’t happen overnight. It creeps up slowly, like the proverbial frog in the pot who doesn’t notice that the water is getting warmer until it is too late – it’s boiling.
Secured bondholder’s contracts are arbitrarily abrogated by government fiat (Chrysler), unions get the bulk of ownership of a public company (GM), preferred institutions get bailouts (the banks), preferred groups get government support (public employee unions). It starts with crony capitalism and it proceeds to threats. Where do we go from here?

Explanation: Why Raising Taxes Will Depress Job Growth

The debate is familiar to anyone who reads the news. Democrats want to allow the Bush tax cuts to expire. Republicans claim that raising taxes on high earners will depress job growth, since many high earners are actually small businesses (rather arbitrarily defined as a business with fewer than 500 employees). What no one ever seems to do is to take the time to explain why raising the top tax rate (on those making over $250K/year) would impact hiring.
The Obama administration’s entire focus seems to have been on huge corporations like GM, AIG, and Wall Street. Yet it is small business that creates most of the jobs in America. A study at the University of Maryland confirmed this well known fact yet again.
When someone structures a business, there are three tax systems that need to be considered; corporate income taxes, personal income taxes, and capital gains. Without oversimplifying too much:

  • Unincorporated small businesses include business expenses and income on their personal 1040 form (know as a Sole Proprietorship) using IRS form Schedule C to list their profit or loss. The result is taxed at personal income tax rates.
  • Businesses incorporate as either a Subchapter S corporation or a Subchapter C corporation. A Subchapter S corporation fills out a business tax return and all the profits (or losses) flow directly to the owner(s)’ personal 1040 tax returns. Subchapter S corporations are thus taxed at personal income tax rates.
  • Subchapter C corporations fill out a corporate tax return and are taxed at a different rate then personal income. The United States has one of the highest corporate tax rates in the Western world. For corporations making between $100K-$339K/year, the rate is 39%. It actually goes down to 35% for corporations making over about $18M/year. By way of comparison, corporate tax rates in Britain don’t exceed 30%. Mom and Pop businesses rarely file as Subchapter C corporations. On the other hand, businesses funded by investors are almost always required to incorporate as Subchapter C corporations.

Let’s try to work through how increasing tax rates on the “rich” can affect hiring (it would be much too complicated to list the bureaucratic hoops that a small business owner has to jump through, so we will just ignore that painful aspect for this example).
Sam owns a small business selling widgets. He employs 20 people. His gross revenue is $2,000,000 and his profit is $320,000. This is the amount that Sam would like to reinvest in his business. Sam pays himself a salary of $100,000, so his personal 1040 form (assuming that Sam’s business is either a Sole Proprietorship or a Subchapter S corporation) will show taxable income of $420,000. When rates go up, Sam will have about $8,500 less to invest in his business. That may make hiring his 21st employee unprofitable. If Sam’s business is three times as large, his revenue would be $6,000,000 and he would have 60 employees and a profit of $960,000. The additional tax would be close to $50,000, the cost of an additional hire. (In the real world, Sam would probably resist hiring his 50th employee, since expensive ObamaCare provisions immediately kick in at 50 employees. Better for a business to hold at 49 employees for as long as possible).
Now multiply Sam’s situation by the millions of small businesses across the United States. Every small business owner who wants to expand will face the same choices as Sam. Maybe Sam will hire an additional employee anyway. But with an uncertain economy, he is less likely to take the risk, especially since he will have a smaller capital reserve. The result could be millions of fewer jobs.
At the same time long term capital gains rates are due to rise from 15% to 20%. In addition, the ObamaCare plan adds a 4% capital gains surtax on the “rich”, bringing the rate to 24% for a total increase of 60%. How is this action designed to encourage venture capital firms to finance more new enterprises? In fact, it will certainly have the opposite effect and depress job growth even more.
The Obama team’s arguments for increasing taxes are twofold; for purposes of “fairness” and to close the huge federal deficit created by out of control spending. These arguments are specious on both economic and philosophical grounds. Under what ideology is it “unfair” for small business owners to keep their earnings? These people risk their family’s economic future on little more than a dream and hard work. They are not GM or AIG. If they fail, they alone pay the consequences. Yet if they succeed (in spite of government doing everything in their power to make it more and more complex and burdensome to start and run a business) government considers it unfair that they reap the fruits of their creativity, hard work, and guts.
In economic terms, money taken from small businesses to fund government does not create wealth. Only the private sector creates wealth. By increasing taxes on small businesses in tough economic times, government depresses risk taking and creativity, slowing economic activity and potentially reducing tax revenue.
The Obama team has decided to take more from surviving businesses rather than depending on broad economic growth to increase tax revenues. The result is that the entire pie will grow much more slowly. Over time, tax revenues will be lower than they would be if pro-growth policies stimulated economic activity.
Higher small business tax rates = less capital investment.
Higher capital gains tax rates = less capital investment.
More bureaucracy and higher costs (ObamaCare) = less capital investment.
Does this look like a jobs plan?

Global Warming – I’m Doing My Part

The debate about global warming has really got me nervous. What if fossil fuel usage is destroying the planet? What if CO2 emissions will result in New Hampshire having winters like Florida in 20 years (wait, is that bad?).
The EPA is worried, and that means I am really worried. Did you know that methane is 20 times more potent as a greenhouse gas than CO2? The EPA is so worried about methane that they’ve devoted millions of taxpayer dollars to the scientific investigation of cow farts. This study is required reading for any true worshiper of Gaia. There will be a test later, and you had better have your flatulent bovine stats straight, brother!
So what to do, what to do? Well, I’ve been evaluating the alternatives to fossil fuels. Ethanol is out. We tried producing 1% of our gasoline needs and food prices went through the roof. The whole country would have to be up to our ass in corn to make a dent, including L.A. and New York. And you know how those guys look down on farmers. Besides, it turns out that farmers were using a ton of gasoline to run their farm equipment to raise the stuff.
Solar? No way to store it for when we need it and it would require so much land we’d have to dodge solar panels with our electric cars. Besides, what would we do at night?
Wind power has potential, but first we have to convince the Kennedys to let us put some wind turbines off of Cape Cod.
Still, we absolutely have to move off of fossil fuels. Have you heard of “peak oil”? Environmentalists are telling us that oil is going to run out, so we’d better be prepared. They’ve been telling us this since the Carter administration, and sooner or later they’re going to be right.
So I’ve been thinking of what I can do on a personal level, and I’ve come up with a plan. I would encourage all of you to follow me. Ready? Here it is; buy a huge, gas guzzling SUV.
I know what you’re thinking; how will millions of Americans driving hulking SUVs help to save the environment? I’ve got it all worked out, so listen up.
Who is the most famous environmentalist of the 21st century? That’s right, Al Gore. Al won an Oscar for his movie, “An Inconvenient Truth”, that contained a bunch of inconveniently untrue “facts”. But it’s the thought that counts to Hollywood, and Al sometimes has one, so Al is a star. He’s also won a Nobel Peace Prize. Al’s focus on climate change, and generating income from the “crisis” (his net worth has increased from $1M in 2000 to the $100-$200M range today) obviously puts him in the company of Barack Obama (they thought that he had potential), Jimmy Carter (huh?), Yassir Arafat (I’m seeing a pattern here) . . . Ok, I guess I’ve made my point.
Anyway, Al hasn’t publicized his strategy, but his plan is apparent to even the most casual observer; use up all the oil available on Earth, thereby making all other alternatives cost competitive! It’s brilliant, when you think about it. And he’s right on top of it. Old Al has huge houses, a 4,000SFer in Nashville and a brand new 6,500SFer in Monticello, CA on the ocean (isn’t he supposed to be concerned about rising sea levels?).
Estimates are that the CA house has 20 times the carbon footprint of the typical American home. Not only that, but Al frequently takes a private jet to his speaking engagements about limiting carbon emissions. And he’s not the only one following this unique strategy. At the Copenhagen Climate Summit in December of 2009, there were 1200 limos and 140 private planes to transport the environmental elite to and from the conference.
So I say, let’s take our cue from the experts! Buy an Escalade, a Hummer, or a Range Rover! 8 mpg or bust! Let’s use up all the oil and those fascists on the right won’t have any choice! Then they’ll have to use solar or wind or bicycle power. Who cares how much we have to pay for energy? Do you?
Al and his friends sure don’t.

Random thoughts about just about everything