Lieutenant Island Views : Commentary About Finance, Politics and Baseball


July 31, 2009
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Will return in September with more posts. Right now I need to work on my tan, reading and golf handicap (which is bad)

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Liberty University Bans College Democrats. So Much for Personal Liberty at Liberty!

May 24, 2009

Liberty University recently announced that it is banning the College Democratic Club from its campus. As has been reported, Liberty’s Vice President for Student Affairs, Mark Hine, advised the student group that the Democratic Party violated the University’s principles because it supports abortion, socialism and the agenda of gay, bisexual and transgender people. The basis for the ban is the non-binding Democratic Party Platform from the 2008 Presidential campaign.

Many registered Democrats and elected Democratic officials would dispute the decision on the basis of fact. For proof of this assertion, one only needs to examine the views of pro-life Senator Bob Casey or gay groups who are angry at President Obama for his failure to invalidate “Don’t ask don’t tell” in the US Military. They know first hand that the Democratic Platform is neither enforceable nor something that is universally supported by leading elected Democrats.

This action represents a dangerous step for an educational institution. Depending on one’s perspective, issues can range from the denial of free speech to jeopardizing the University’s not for profit status by directly engaging in partisan politics as opposed to taking positions on individual issues. Unlike a recent decision by Brigham Young University-Idaho to ban both the Democratic and Republican clubs in order to protect its tax exempt status and eliminate any potential charge of the institution supporting one or another political party, Liberty is singling out the Democrats as a group and taking no action against the Republican College Club.

The loss of tax exempt status could have a material adverse impact on Liberty’s economic condition. Loss of not for profit status would jeopardize funding from public and private programs for research, scholarships and other essentials. It could also hurt fundraising from contributors who would no longer be able to claim a tax deduction for their gifts.

As a self proclaimed “conservative” institution with strong supporters in segments of the Christian community, they should question whether a significant potential economic loss is worth any perceived benefit in denying the rights to free speech for what is likely to be an insignificant number of students at the school. Such an action to deny a liberty by a school named Liberty raises the specter of both losing moral standing and making its name synonymous with something new; hypocrisy.

Libertarians (as opposed to Liberty alumni) and civil libertarians alike should come to the defense of the Democratic Club at Liberty University. Likewise, the federal government should take action to revoke Liberty’s tax exempt status if it does not withdraw this edict. Regardless of one’s political affiliation, defense of freedom of expression is critical to the American way of life. It is what separates us from the radical theocratic thinking of our enemies in Al Queda.

Is George Will Un-American or Just an Insufferable Elitist?

April 16, 2009
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In an article/screed today, George Will decries Americans’ love affair with denim and blue jeans. He tells the story of Levi Strauss inventing jeans. He also indicates that, in his entire life, he has owned but one pair which he has only worn once to a party which required that everyone be in jeans. Doesn’t George know that wearing jeans is one thing that virtually all Americans can agree on? They are uniquely American. Created for our early economic development (use by those prospecting for gold), they now are owned by most men, women and children in the nation. Jeans are generally cheap, comfortable and non-determinative of class, social status, education level or other things. Jeans are truly non-discriminatory. Rich, Poor, Blacks, Whites, Native Americans, Asians, Blue Bloods and Immigrants all wear and enjoy jeans. Why does George have a problem. Is it in some way retaliatory for someone telling him that his use of bow ties is “European”? By his own admission, he has virtually no experience as a jeans wearer or owner. For such a Libertarian type of fellow, it is hypocritical to hear him foisting his anti-denim values on the rest of us. Perhaps he should avoid being an arbiter of good taste and focus on subjects for which he is capable of more inciteful and knowledgeable commentary. George, how about another good book on baseball?

Easter, Passover and Real American Values

April 10, 2009
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This weekend American Jews and Christians of various denominations will celebrate high holy days of their respective faiths. As they do so, they should also remember and give thanks to the wisdom our our nation’s founding fathers that they chose to distinguish our nation as one with a clear separation of religion from governmental law. One of the great principles of our nation is that individuals can be free to practice, or not practice, the religion of their choice. To those who would suggest otherwise, we would urge that they re-read their American history.

The attached cartoon and a copy of Thomas Jefferson’s word to Baptist ministers in Danbury, Ct. make clear the values of our founders and the author of the Decration of Independence.

Happy Easter and Happy Passover to all who celebrate. God bless America to everyone!!

Whither the Dollar?

March 24, 2009
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Whither the dollar? That is the question. As the attached article points out, the Chinese government is worried. If they are worried, we should be too! A cheaper dollar certainly debases their investment in dollar denominated securities, particularly the Treasury obligations which they already own. Equally significant, a cheaper dollar will likely force us to pay higher rates on the Treasuries which we will sell to finance the large stimulus package that will be unfolding in the coming months. The only silver lining is that China is as addicted to a high dollar as we are. As we are their largest market for all sorts of goods, and because their currency is basically pegged to ours, their income and purchasing power erodes as the dollar declines. One answer for them is to allow their currency to trade more freely like other currencies do. While it sounds reasonable, they know that freeing their currency to trade on a “market basis” is the proverbial slippery slope. It is a slope that they will find pock marked with speed bumps and other hidden dangers that they have, to date, assiduously avoided. This is a relationship that bears watching closely and must be handled with deft skills by the Obama administration

About author

Mr Thaler is currently the Managing Partner of Lieutenant Island Partners, an organization providing corporate finance advice and general consulting to corporations and not-for-profit organizations. Mr Thaler retired as Vice Chairman of Deutsche Bank Securities in early 2008. His background includes experience as an investment banker, senior manager, business builder, college professor, not for profit board chair and trustee. In his thirty plus years as an investment banker for Deutsche Bank and Lehman Brothers, he has been involved in numerous significant debt and equity financings, mergers & acquisitions, leverage buyouts, restructurings and cross border transactions. Of particular note, Mr Thaler has been one of the most active participants and strategic advisors to the homebuilding industry. In a period of significant turmoil and losses, he was one of the few active bankers to the industry who did not have either a loss or credit write down. He is currently advising several public builders on strategic matters and is an adjunct professor of finance at Morehouse College in Atlanta, Georgia. Though he lives in New York, he is a life long Red Sox fan!