Have you noticed that many politicians who have trouble dealing with reality also seem to prefer fantasyland when dealing with budgets?

New York politicians have been living in political fantasyland for many years. Upper-income people living in New York City have faced the highest state and local income tax rates in the country (over 12 %). Recent studies show high-income earners are in mass flight from New York to friendlier tax environments.

The rational thing for New York politicians to do would be to cut tax rates to make New York more competitive; but no, they increased taxes on the top earners (many of whom continue to pack their bags).

The new Republican governor of Puerto Rico, Luis G. Fortuño, wants to entice them and other productive Americans to his island.  He is determined to provide tax advantages that no state can, even those with no state income tax.  It may be an offer you'll find hard to refuse.

To all outward appearances, the just-concluded Conservative Political Action Conference (CPAC) was a huge success. It was attended by a large, boisterous crowd, a substantial part of which was student-age - a promising indicator of the movement’s appeal to the coming generation. A number of luminaries, including several prospective presidential candidates, addressed enthusiastic audiences clearly invigorated by November’s successes at the polls.

CPAC’s apparent vigor, however, obscured the fact that the conservative movement is at a crossroads: Will it continue to be comprised of, and appeal to, all three elements of Ronald Reagan‘s winning coalition - fiscal discipline, traditional family and other social values, and a national security approach rooted in the philosophy of “peace through strength”? Or will it be reduced to a libertarian-dominated, small-government agenda that ignores or repudiates Reagan‘s conservative values and robust defense platform?

Upon the answer rests not only the future of this vital movement, but of America.

Fantasies aside, like Zero having a total mental breakdown and resigning, it's not clear how this week could have been realistically better.

The Gulf Oil Spill is rapidly becoming Zero's Katrina.  Democrat Senator Mary Landrieu and Democrat guru James Carville - both Louisianan - are just unloading on Zero for his insouciant incompetence.  The anger and contempt that lots of Democrats - Democrats - feel towards him now is growing.  Even Chrissie Tingle-leg Matthews is blasting him.

More and more Americans are realizing that the "damn hole" that needs to be plugged is the one between Zero's nose and chin, which gushes verbal pollution far more destructive to America than any oil spill.

Then there is Sestak-gate.  It is a complete win-win.  It torpedoes Sestak's chances to get elected, virtually handing Snarlin' Arlen's PA senate seat to Republican Pat Toomey. 

And, as Jack Kelly points out, most people will decide it's the Chicago Boys in the White House who are lying, not a Navy Admiral turned Congressman.  Thus it adds to growing public belief that the Zero Regime doesn't tell the truth and cannot be trusted.  Adding further is Republican insistence that Attorney General Holder appoint a special prosecutor to investigate what could be an impeachable offense by Zero.

Plus the economy continues to sink, the DOW is tanking, gold is rising and so is unemployment.  All of this is great news.  The worse things are, the worse things are going to be for the Dems in November.  Yep, the glass is more than half-full this week.

Public opinion polls show the performance rating of Congress at record low levels. Given that Congress and top administration officials are requiring pay cuts for those in the private sector whose companies have performed poorly, should not the same standard apply to those in government who have had a major responsibility for running the economy into the ground?

Don't presidents and members of Congress always claim credit when the economy is performing well?  So isn't it fair to blame them when the economy is in a mess?

Could it be that one reason Congress has performed so poorly is because, for 100 years, its members' compensation has been totally unrelated to their performance? (All wise observers know that one reason socialism fails is that workers are not rewarded for superior performance or penalized for performing badly.)

I do not claim to know what the "right" pay is for members of Congress, but I do know their present compensation system makes no sense. Such a system gives them no vested interest in protecting the rest of us from inflation or any interest in pro-growth economic policies.

Pakistan is a textbook example of a disaster of biblical proportions in the making. Its hyperactive nuclear expansion, weak central government, impoverished, radicalized population, and pro- Islamist military and intelligence arms are sources for major concern. That concern becomes all-out alarm in light of the Taliban/al-Qaida's control over anywhere from a quarter to a third of Pakistani territory and the widespread public support for them throughout the country.

Since taking office, the Obama administration has failed to conceive of a strategy for contending with the situation. One of the main obstacles to the formation of a coherent US strategy is the Obama administration's move to outlaw any discussion of the basic threats to US interests. Shortly after entering office, President Barack Obama banned the use of the term "War against terror," substituting it with the opaque term "overseas contingency operation."

Last April, Obama banned use of the terms "jihad," "Islamic terrorism" and "radical Islam" in US government documents.
Given that US officials are barred from using all the terms that are relevant for describing reality in places like Pakistan, it is obvious why the US cannot put together a strategy for contending with the challenges it faces there.

The Obama administration's decision to ban relevant language from the official US policy discourse was ideologically motivated. And in choosing ideology over reality, the Obama administration has induced a situation where rather than construct policies to deal with reality, at all levels, US officials have been charged with constructing policies to deny and ignore reality.

35,000 feet over the Caribbean.  Right after the Rendezvous, Rebel and I took off for Belize to attend an asset protection conference at which I was the keynote speaker.

It's Friday now and I'm on my way to look at other possible escape hatches in the Caribbean - and flights and connections in this area make it difficult to get the HFR and TTP Weekly Report out on schedule - so I hope you'll cut me some slack today.

You may have read on Drudge yesterday about how the Fascicrats snuck a Capital Controls Act into the Orwellian-named HIRE (Hiring Incentives to Restore Employment) HR 2847 bill that Zero has signed into law.

The Offset Provisions - Subtitle A-Foreign Account Tax Compliance section of 2847 directs banks to withhold 30% of money you want to wire overseas.  It's outrageously fascist-totalitarian and it was snuck into a bill supposedly about increasing employment with no one noticing.

It made Drudge because a CBS News stringer, Brian Brawdy, was at the Belize conference where it was discussed in analytical detail and wrote a story on it that got Drudge's attention.

This Capital Controls Act is only one of a score of Zero's efforts detailed at the conference all of which are designed not to increase jobs and prosperity, but to increase government control over our lives and steal as much money from us as the government thinks it can get away with.  The only bright spot is...

For at least a century, the Washington political class has been correctly known for creating more problems than solving existing ones. This tendency to enact destructive, rather than constructive, solutions for problems (most often created by government) has now gone into hyper-drive.

Many who see this situation often blame it on "excessive partisanship," where the real problem is caused by a bipartisan lust for power that breeds too much accommodation, rather than questioning and resistance to bad ideas.

The failure of either political party to get serious about reining in the growth of government has caused despair among small government conservatives, libertarians and others who believe in limited government. And this despair is contributing to the list of "destructive solutions" now infecting Washington.

Challenges in court to the constitutionality of Obamacare have exposed the broader agenda of those who are committed to the permanent expansion of government power which that legislation represents. The specific legal issues are almost irrelevant because Obamacare is so clearly outside the scope of limited, constitutional government. This has made it necessary for the advocates of unrestrained government power to either attack the U.S. Constitution itself or the very concept of constitutional limits on the tyranny of the majority or of a ruthless minority elite.

Some try to sidestep the attack on the Constitution by substituting a war on English. They claim to support the Constitution but deny that words have any objective meaning.

Need another example of what's at stake in November?  How about your 401(k) retirement savings? 

Via something called the Employee Benefits Security Administration, a group of fascisti within the Labor Department, the Dems are planning to seize your and everyone else's savings a lá Argentina to fund public union worker pensions. 

The way to prevent this is a Republican majority in the 112^th Congress.  If the Dems keep their majority, you will see millions of folks pulling all their money out of their 401(k)s, taking the penalty haircut, and putting it where government goons can't steal it.

All those millions need to remember this in November.

***
Now, how about something that will really tick you off?  This week, plans were announced to build a gigantic 13-story Moslem mosque near Ground Zero, the site of Islam's 9/11 attack on America.

Note it will be called "the Cordoba House."  What a telegraphic punch.  Cordoba was the capital of the Islamic Emirate of Al-Andalus (Andalusia) in Spain, seized by Moslem invaders from Africa in 711 and recaptured by Spanish Christians under Ferdinand III of Castille in 1236.  What better indication could there be of the Islamic intent to make America a Moslem Al-Andalus Emirate?

Is the current recession the worst since the Great Depression? Even though the president, many members of Congress and many journalists keep saying we are in the worst recession since the 1930s, it is an assertion that is premature, to say the least.

At the end of World War II, from 1945 to 1946, there was a very sharp drop in U.S. output (12.1 percent) as the war economy began its transition to a civilian economy.

The deepest and longest-lasting recession the United States has experienced since then began in 1980, when Jimmy Carter was president (the gross domestic product dropped 9.6 percent in the second quarter of that year) and did not end until fourth-quarter 1982, almost two years into the Reagan presidency.

As can be seen in the accompanying chart, both President Reagan and President Obama inherited an economy suffering from a year of no growth, along with rising unemployment.  Yet their approaches to the problem are polar opposites.

As the threats against Israel mount from all directions, the job of the IDF Chief of General Staff is becoming more challenging by the day.

First on the list of threats is Iran. While it is apparently true that the Stuxnet computer virus continues to wreak havoc on Iran's nuclear program, it is also true that Iran remains dedicated to moving forward, despite all obstacles.

Then there is Egypt. Iran's dictator-in-chief Ali Khamenei has spent the two weeks since the anti-regime protests began in Egypt bragging that the unrest shows Iran's star is rising. The "Islamic awakening" hearkened by the 1979 Iranian revolution is unfolding before our eyes, he says.

POLITICAL DEVELOPMENTS in Egypt, as well as the sabotage of the natural gas pipeline from Egypt to Israel at el-Arish, show that the southern front is active again after 30 years. The IDF needs to prepare for the possibility of a conventional war in the south and the north. It will have to relearn how to fight a war in the desert. New weapons systems will have to be developed and procured. Troops will have to receive expanded training.

In short, the ways the IDF thinks about war, plans for war, arms for war, trains for war and wages war are all going to have to change.

In light of these awesome challenges, the IDF's next chief of general staff will have to have the attitude of a revolutionary as he guides the IDF through massive change, and commands it in complex and perhaps existential battles.

Unfortunately, chances that such a commander will arise received a blow last week when Attorney General Yehuda Weinstein decided to force the government to cancel its decision to appoint Maj. Gen. Yoav Galant to replace outgoing Chief of Gen. Staff Lt. Gen. Gabi Ashkenazi next Tuesday.