The Republicans who voted against the Paulson plan may have been responding to their grass roots constituency who opposed the “bailout”. It is likely that their constituents do not understand that this is a liquidity crisis first and a bailout second and even then it is less of a bailout than a stabilization effort in a panicked market.
But it is also likely that they have very legitimate concerns about a huge amount being spent in a way that is in absolute conflict with their basic principles of governance, and being rushed to do so because of a crisis that few people understand.
The money is not being spent on bonuses and entertainment. It is being used to buy assets at very distressed prices. Some of the guarantees the Treasury is making are in exchange for preferred stock. Much of the $700 billion is likely to be recovered and a profit is even possible. The alternative is a credit crisis and a big chance of a 1929.
The Republicans should not be voting to allay the fears of a constituency that doesn’t understand the urgency or depth of the problem. Leadership in such a crisis requires you to act as you see fit even if it is not understood by your voters and even if it is not popular.
If all we needed was to poll the voters for solutions to such a crisis we could replace our leaders with 900 numbers and let them call in like voting on American Idol.
Tuesday, September 30, 2008
Salt into the Wound
from Kyle-Anne Shiver (see recommended sites)-
“After several days of rage from conservative activists regarding a provision in the bailout bill that would send some of the profits from the sale of distressed assets the goverment buys into an affordable housing trust fund, congressional negotiators have removed section 105(d) of the bailout proposal, according to aides on both side.”
Before striking this add-on, the $700 billion bailout package included a provision for roughly 20% of funds being set aside for low-income mortages of precisely the type that got us into this mess in the first place. The money would have been given to state and local governments to use at their own discretion, and the chief beneficiary of these type funds in the past has been ACORN. ACORN then plays hardball with lending institutions, threatening them with mass actions, angry protests, etc. if they don’t make it easy for those who can’t pay back to borrow money.
Republicans in Congress had called this provision in the bailout a deal-breaker. Thank the Good Lord someone is watching out for the taxpayers.
HKO comments- It is an absolute outrage that the same partisans who caused this crisis and ignored the warnings would try to perpetuate this crisis by hijacking the bailout to continue making the kind of loans that caused it. The have no shame.
“After several days of rage from conservative activists regarding a provision in the bailout bill that would send some of the profits from the sale of distressed assets the goverment buys into an affordable housing trust fund, congressional negotiators have removed section 105(d) of the bailout proposal, according to aides on both side.”
Before striking this add-on, the $700 billion bailout package included a provision for roughly 20% of funds being set aside for low-income mortages of precisely the type that got us into this mess in the first place. The money would have been given to state and local governments to use at their own discretion, and the chief beneficiary of these type funds in the past has been ACORN. ACORN then plays hardball with lending institutions, threatening them with mass actions, angry protests, etc. if they don’t make it easy for those who can’t pay back to borrow money.
Republicans in Congress had called this provision in the bailout a deal-breaker. Thank the Good Lord someone is watching out for the taxpayers.
HKO comments- It is an absolute outrage that the same partisans who caused this crisis and ignored the warnings would try to perpetuate this crisis by hijacking the bailout to continue making the kind of loans that caused it. The have no shame.
Economic Scapegoating
Obama’s search for an economic scapegoat either belies his utter economic ignorance or only seeks to manipulate the crisis for his political gain; a task the larger media is only too willing to assist.
His latest attempt is to blame Graham who pushed a deregulatory banking effort under the Clinton era (with strong Clinton and Democratic support). Conveniently Graham is an advisor to McCain.
Contrary to Obama’s ignorant rants, Graham’s reforms provided the backbone for the resolution of the current crisis, not its cause.
The 1999 Gramm-Leach-Bliley bank-deregulation bill eliminated the existing walls between financial institutions. Such diversified financial institutions have performed much better than most. Bank of America's acquisition of Merrill Lynch would not have been possible before Gramm’s deregulation. J.P. Morgan wouldn’t have taken over Bear Stearns, and Barclays Bank would not have been allowed to buy Lehman Brothers.
Goldman Sachs and Morgan Stanley have become traditional bank holding companies. Investment banking is dead. Would we prefer to force these two strong companies to remain in a model that no longer works?
In fact the sectors with the most regulations have performed the poorest. The unregulated world of hedge funds and private equity seems to be performing much better than the more regulated world of commercial and investment banking.
In fact the one area of regulation most controlled by Congress,the oversight of Fannie Mae was in fact the biggest disaster of all. Obama will find his own party's fingerprints all over this smoking gun.
His latest attempt is to blame Graham who pushed a deregulatory banking effort under the Clinton era (with strong Clinton and Democratic support). Conveniently Graham is an advisor to McCain.
Contrary to Obama’s ignorant rants, Graham’s reforms provided the backbone for the resolution of the current crisis, not its cause.
The 1999 Gramm-Leach-Bliley bank-deregulation bill eliminated the existing walls between financial institutions. Such diversified financial institutions have performed much better than most. Bank of America's acquisition of Merrill Lynch would not have been possible before Gramm’s deregulation. J.P. Morgan wouldn’t have taken over Bear Stearns, and Barclays Bank would not have been allowed to buy Lehman Brothers.
Goldman Sachs and Morgan Stanley have become traditional bank holding companies. Investment banking is dead. Would we prefer to force these two strong companies to remain in a model that no longer works?
In fact the sectors with the most regulations have performed the poorest. The unregulated world of hedge funds and private equity seems to be performing much better than the more regulated world of commercial and investment banking.
In fact the one area of regulation most controlled by Congress,the oversight of Fannie Mae was in fact the biggest disaster of all. Obama will find his own party's fingerprints all over this smoking gun.
Abortion Politics
Americans cherish their rights yet we understand these rights have limits. Freedom of religion does not permit polygamy or animal sacrifice. Freedom of speech does not include public obscenity or hate speech.
The right to bear arms does not allow the unlimited choice of weapons for anyone to carry anywhere they choose.
When certain rights fanatics push their rights too far it causes a backlash. I respect the second amendment, but they went too far when they tried (in the Georgia legislature) to over ride property rights by trying to allow concealed carry even on property that the private owner prohibited, and pushed to allow concealed carry in public airports.
Such extreme promotion of rights without restrictions diminishes respect for those rights.
I believe this has happened in the arena of abortion rights.
The court ruling in Roe vs, Wade established a woman’s right to choose an abortion in the first trimester. That ruling became the defining moment for a woman’s right to determine her own fate, and be freed from the control of a male dominated power structure.
It has remained in bitter conflict as those who believe in the humanity of the unborn challenge the woman’s right to have sole determination of it’s (or his or her) fate. It has become the defining issue of the religious right as well.
Yet when the first trimester rights were stretched to include “partial birth” abortions, many saw this as infanticide. Progress in neonatology has removed any doubt of the humanity of the fetus in the last few months. How can it be a human being the day after it is born and any less the day before?
The extreme pushed even further when they debated a bill to withhold medical treatment for babies that survived an abortion. The development of a commonly accepted right, even developed under bitter compromise, to the extreme endangered its support.
The political fact of abortion is that it is supported by the majority, but like any other right, not without limits.
John Zogby’s polls show that 75% of Americans believe abortion is morally wrong yet the overwhelming majority also believes the government should not interfere in a woman’s decision on this matter. The majority are more nuanced than the extremists on either side. They would support a woman’s right if her life was in danger as a result or in the case of rape, or if the child had serious medical problems. But generally they believe this is a private decision; a very serious decision, but still a private one.
Because the majority of women and men support a woman’s right to choose, I have always thought that the strong prolife position was a loser for the Republicans, yet both McCain and Palin have established very strong pro life positions, stronger than any Republican has in recent memory, and they are well ahead in the polls. How can this be?
There are several possible explanations:
1. The extreme push into partial birth abortions has alienated some of the support from the moderates.
2. The removal of the stigma of single motherhood has made an abortion less socially necessary. Single motherhood in some segments of our culture is a right of passage.
3. Widespread birth control has also reduced the need and demand.
4. The abortion rights issue is just relatively less important in light of security and economic issues. It is less of a litmus test issue.
5. Prolife families procreate more. NOW is breeding itself out of existence.
6. If the candidates were closer together on the bigger issues then this debate would become a more important issue of differentiation. But the candidates are so far apart on the critical issues, that this one is less important.
7. There is a broader opposition to abortion. It is no longer limited to extreme right wing evangelical groups. Black leaders have opposed the focus on abortion in black neighborhoods as a form of social genocide and orthodox Jews and Muslims also oppose it. Catholics and Hispanics who are largely Catholic also weigh to the pro life side.
Given the tremendous shift on the issue of the last generation, it will be interesting to see its impact on the election. We remain strongly divided, but it may have less influence that we would ordinarily expect.
The right to bear arms does not allow the unlimited choice of weapons for anyone to carry anywhere they choose.
When certain rights fanatics push their rights too far it causes a backlash. I respect the second amendment, but they went too far when they tried (in the Georgia legislature) to over ride property rights by trying to allow concealed carry even on property that the private owner prohibited, and pushed to allow concealed carry in public airports.
Such extreme promotion of rights without restrictions diminishes respect for those rights.
I believe this has happened in the arena of abortion rights.
The court ruling in Roe vs, Wade established a woman’s right to choose an abortion in the first trimester. That ruling became the defining moment for a woman’s right to determine her own fate, and be freed from the control of a male dominated power structure.
It has remained in bitter conflict as those who believe in the humanity of the unborn challenge the woman’s right to have sole determination of it’s (or his or her) fate. It has become the defining issue of the religious right as well.
Yet when the first trimester rights were stretched to include “partial birth” abortions, many saw this as infanticide. Progress in neonatology has removed any doubt of the humanity of the fetus in the last few months. How can it be a human being the day after it is born and any less the day before?
The extreme pushed even further when they debated a bill to withhold medical treatment for babies that survived an abortion. The development of a commonly accepted right, even developed under bitter compromise, to the extreme endangered its support.
The political fact of abortion is that it is supported by the majority, but like any other right, not without limits.
John Zogby’s polls show that 75% of Americans believe abortion is morally wrong yet the overwhelming majority also believes the government should not interfere in a woman’s decision on this matter. The majority are more nuanced than the extremists on either side. They would support a woman’s right if her life was in danger as a result or in the case of rape, or if the child had serious medical problems. But generally they believe this is a private decision; a very serious decision, but still a private one.
Because the majority of women and men support a woman’s right to choose, I have always thought that the strong prolife position was a loser for the Republicans, yet both McCain and Palin have established very strong pro life positions, stronger than any Republican has in recent memory, and they are well ahead in the polls. How can this be?
There are several possible explanations:
1. The extreme push into partial birth abortions has alienated some of the support from the moderates.
2. The removal of the stigma of single motherhood has made an abortion less socially necessary. Single motherhood in some segments of our culture is a right of passage.
3. Widespread birth control has also reduced the need and demand.
4. The abortion rights issue is just relatively less important in light of security and economic issues. It is less of a litmus test issue.
5. Prolife families procreate more. NOW is breeding itself out of existence.
6. If the candidates were closer together on the bigger issues then this debate would become a more important issue of differentiation. But the candidates are so far apart on the critical issues, that this one is less important.
7. There is a broader opposition to abortion. It is no longer limited to extreme right wing evangelical groups. Black leaders have opposed the focus on abortion in black neighborhoods as a form of social genocide and orthodox Jews and Muslims also oppose it. Catholics and Hispanics who are largely Catholic also weigh to the pro life side.
Given the tremendous shift on the issue of the last generation, it will be interesting to see its impact on the election. We remain strongly divided, but it may have less influence that we would ordinarily expect.
Monday, September 29, 2008
Out of Her League?
While I have been critical on the Couric and Gibson interviews with Sarah Palin, I can not ignore her awkwardness in many of her answers. Palin seems to have a short list of typical Republican talking points that she uses to answer any question regardless of its relevancy.
When asked to justify the $700 billion dollar bailout by Couric she rambled and went on tangents talking about cutting taxes, creating jobs and avoided any direct discussion of the most important issue on the table. If McCain had answered as she did we would have thought he had dimentia.
Tina Fey played Palin to the hilt on Saturday Night Live, mimicking this interview with a most uncomfortable accuracy.
Is Palin out of her league as Kathleen Parker at National Review writes? Should she be replaced at this critical point in the game before the vice presidential debates?
One with the understanding of these issues would be able to give answers that are brief and clear, and one certainly should have expected such a question. Hopefully the handlers will be able to coach her better and improve her performance.
While her awkwardness is disconcerting, our financial crisis was developed by leaders who were articulate, passionate, clear and disastrously wrong.
Judgment is more important than polish and her followers probably still respect her all American girl credentials. We would just feel much better if she could communicate them much better under fire. This is the age of YouTube and such a display is damaging.
When asked to justify the $700 billion dollar bailout by Couric she rambled and went on tangents talking about cutting taxes, creating jobs and avoided any direct discussion of the most important issue on the table. If McCain had answered as she did we would have thought he had dimentia.
Tina Fey played Palin to the hilt on Saturday Night Live, mimicking this interview with a most uncomfortable accuracy.
Is Palin out of her league as Kathleen Parker at National Review writes? Should she be replaced at this critical point in the game before the vice presidential debates?
One with the understanding of these issues would be able to give answers that are brief and clear, and one certainly should have expected such a question. Hopefully the handlers will be able to coach her better and improve her performance.
While her awkwardness is disconcerting, our financial crisis was developed by leaders who were articulate, passionate, clear and disastrously wrong.
Judgment is more important than polish and her followers probably still respect her all American girl credentials. We would just feel much better if she could communicate them much better under fire. This is the age of YouTube and such a display is damaging.
Sunday, September 28, 2008
Partisan Origins
Kyle-Anne Shiver’s blog has three videos on the Fannie Mae Crisis, and if anyone is uncertain on the origin these should clarify it tremendously. View all three at http://www.kyleanneshiver.com/
Also view this Fox News piece http://www.youtube.com/watch?v=cMnSp4qEXNM .
If the general public understood the origin then this crisis would be a boon to the Republican candidates and a total embarrassment to the Democrats. Yet just the opposite seems to be the case. I can not remember a problem of this magnitude that has had such partisan origins.
a few highlights
At the center of this financial crisis is Fannie Mae
Leveraging the crisis is the Community Reinvestment Act, originated under Carter and heavily pushed under Clinton
Bush, McCain, Alan Greenspan and other mostly Republican leaders have warned about the growth of Fannie Mae, its mismanagement, and the need for vigorous oversight as far back as 2001.
On almost strictly party lines the Democrats in Congress refused to acknowledge these serious warnings and voted against bills to restrict Fannie Mae.
Obama was second only to Christopher Dodd in the amount of financial contributions from Fannie Mae. Yet he was the most junior senator.
Some of the worst perpetrators of the Fannie Mae crime are Obama’s financial and housing advisors, such as Raines and Johnson.
The Other Failure
While I may be starting to sound like a broken record on the background of these major failures on Wall Street, there is a greater failure in our national media.
The frustration so many feel over this financial mess is directly related to how little they understand about it. While macro economic financial policy and regulation seems a bit heady to lead the evening news with, good reporters and journalists know how to make complicated stories discernable to the average readers.
The core of this problem is really very simple and most people are capable of understanding it.
Bu the larger media finds the stories of corporate greed in the tale of Enron much sexier than disclosing the fallacy of policies designed to put people in homes they could not afford. Not only did the news provide minimal coverage of the misdealing of Fannie Mae several years ago when it was uncovered, but they have failed to disclosed the true source of the problem today while we are on the precipice of a financial meltdown.
I was impressed to see a Fox News report on the true origin of this mess in the House and Senate Banking Committees and how warnings from Greenspan and others were ignored. Yes, there were a few stories in the Wall Street Journal and even in the New York Times but the stories are largely absent from most media outlets.
Yet we see plenty of clips of Pelosi and Obama blaming it all on Bush’s policies and government deregulation; mindless mantras, old fashioned scapegoating, and devoid of any truth. It is sort of like blaming the holocaust on the Jews.
The larger media has no problem running endless stories on the pending doom of global warming, which is still debatable and uncertain, but they have neglected to given any meaningful coverage of the greatest financial crisis in my lifetime in spite of clear reliable warnings from very reliable sources for nearly a decade.
The failure of the major media outlets to report this story accurately is as big a crime as what Congress, Fannie Mae and the Wall Street cohorts perpetuated on the American people.
The frustration so many feel over this financial mess is directly related to how little they understand about it. While macro economic financial policy and regulation seems a bit heady to lead the evening news with, good reporters and journalists know how to make complicated stories discernable to the average readers.
The core of this problem is really very simple and most people are capable of understanding it.
Bu the larger media finds the stories of corporate greed in the tale of Enron much sexier than disclosing the fallacy of policies designed to put people in homes they could not afford. Not only did the news provide minimal coverage of the misdealing of Fannie Mae several years ago when it was uncovered, but they have failed to disclosed the true source of the problem today while we are on the precipice of a financial meltdown.
I was impressed to see a Fox News report on the true origin of this mess in the House and Senate Banking Committees and how warnings from Greenspan and others were ignored. Yes, there were a few stories in the Wall Street Journal and even in the New York Times but the stories are largely absent from most media outlets.
Yet we see plenty of clips of Pelosi and Obama blaming it all on Bush’s policies and government deregulation; mindless mantras, old fashioned scapegoating, and devoid of any truth. It is sort of like blaming the holocaust on the Jews.
The larger media has no problem running endless stories on the pending doom of global warming, which is still debatable and uncertain, but they have neglected to given any meaningful coverage of the greatest financial crisis in my lifetime in spite of clear reliable warnings from very reliable sources for nearly a decade.
The failure of the major media outlets to report this story accurately is as big a crime as what Congress, Fannie Mae and the Wall Street cohorts perpetuated on the American people.
Saturday, September 27, 2008
Shame and Blame
At the crux of the credit crisis is the fact that bad loans were made to people to buy houses they could not afford. I blame the Congress for seeking to suspend sound banking practices to achieve the political goal of helping poor people finance a home. I blame the House Financial Services Committee Chaired by Barney Frank and the Senate Committee on Banking, Housing and Urban Affairs Chaired by Christopher Dodd for ignoring warnings of the malfeasance of Fannie Mae made years ago by special investigative counsels. This problem extends back long before the current Bush Administration.
I blame the OCC and other bank regulatory agencies for turning a blind eye or getting duped by executives. I blame executives who found a way to turn the political goal into a gravy train by creating financial instruments that no one understood. I blame the ratings agencies that gave credibility to securities and companies that clearly did not deserve it. I blame auditing practices of accounting firms that did not adapt to the new instruments and failed to uncover sloppy and fraudulent practices.
I blame the Boards of Directors of the financial companies who made large fees while failing to deliver the most basic requirements of financial stewardship. I blame the compensation committees who created such outrageous compensation incentives, that a bishop would be tempted to kick a hole in a stained glass window to reach for the lucre.
I could blame Greenspan for creating too much liquidity causing a boom in the housing market and I could blame Bernanke for tightening liquidity too much thus triggering the current credit squeeze and housing slump.
I blame the media for doing such a miserable job clarifying and covering this disaster in spite of many clear high level warnings, yet finding plenty of ink to cover questionable issues such as global warming.
But the core of the problem is the extravagant effort to put people in houses they could not afford. All the other blame delivered on that goal.
Yet the political leaders express their greatest concern over how to keep people from losing their homes. This concern is what caused the problem to begin with. The government as it so often does wanted to deliver a benefit that it did not want to pay for.
Many of these people should lose their homes. One report found that 70% of subprime borrowers lied about their income. They should lose their homes.
The borrower with a $50,000 income in a $500,000 home should lose his home and the lender should lose the decline in the home value. Shame and blame goes to both parties.
This crisis is a liquidity crisis and that should be the focus of the solution. Keeping people in homes thay can not afford is not the goal of the bailout. It is what eventually made the bailout so costly and necessary.
I blame the OCC and other bank regulatory agencies for turning a blind eye or getting duped by executives. I blame executives who found a way to turn the political goal into a gravy train by creating financial instruments that no one understood. I blame the ratings agencies that gave credibility to securities and companies that clearly did not deserve it. I blame auditing practices of accounting firms that did not adapt to the new instruments and failed to uncover sloppy and fraudulent practices.
I blame the Boards of Directors of the financial companies who made large fees while failing to deliver the most basic requirements of financial stewardship. I blame the compensation committees who created such outrageous compensation incentives, that a bishop would be tempted to kick a hole in a stained glass window to reach for the lucre.
I could blame Greenspan for creating too much liquidity causing a boom in the housing market and I could blame Bernanke for tightening liquidity too much thus triggering the current credit squeeze and housing slump.
I blame the media for doing such a miserable job clarifying and covering this disaster in spite of many clear high level warnings, yet finding plenty of ink to cover questionable issues such as global warming.
But the core of the problem is the extravagant effort to put people in houses they could not afford. All the other blame delivered on that goal.
Yet the political leaders express their greatest concern over how to keep people from losing their homes. This concern is what caused the problem to begin with. The government as it so often does wanted to deliver a benefit that it did not want to pay for.
Many of these people should lose their homes. One report found that 70% of subprime borrowers lied about their income. They should lose their homes.
The borrower with a $50,000 income in a $500,000 home should lose his home and the lender should lose the decline in the home value. Shame and blame goes to both parties.
This crisis is a liquidity crisis and that should be the focus of the solution. Keeping people in homes thay can not afford is not the goal of the bailout. It is what eventually made the bailout so costly and necessary.
Declining Property Values and Local Taxes
With the significant decline in property values that are certain to spill over into tax assessments, we can surely expect local millage rates to increase at a time when incomes are faltering.
A property tax payer would be wise to challenge his assesment if an objective appraisal would deliver a lower price.
It may in fact pay to have your home appraised ahead of time to be prepared to challenge your next tax valuation.
A property tax payer would be wise to challenge his assesment if an objective appraisal would deliver a lower price.
It may in fact pay to have your home appraised ahead of time to be prepared to challenge your next tax valuation.
Friday, September 26, 2008
The Road To Hell is Paved With Good Intentions
from the National Review Online
September 25, 2008 2:00 PM
The Tyranny of Good Intentions
Billing day.
By Alex Castellanos
Excerpts
And it’s Republicans who are bringing back the Era of Big Government. The New Deal set off a trend of higher taxes and more government that only got worse. Similarly, this generation will find it difficult to explain why the same paternal state we called upon to rescue Wall Street can’t bend down a little lower to provide government-paid health care, energy subsidies, and every imaginable social service.
So is this the time to pull our nation back from an economic precipice? Yes, for America cannot afford to play Russian roulette. If Congress votes down this bailout and our economy collapses, Americans will be at Washington’s door with torches and pitchforks. Remember when Republicans shut down the government? Imagine if Republicans shut down the economy. There is a liquidity crisis. Whether with loans or a bailout, our government must meet it.
Now, we must account for decisions made long ago. Washington’s dream was an America where every person could borrow enough money to buy a home. The Community Reinvestment Act, signed by President Carter and strengthened by Bill Clinton, encouraged bankers to loosen underwriting standards to “meet community needs.” Communities, of course, were not the ones obliged to pay the loans back.
As one former banker recently shared, “It is easy to recall sitting around bank board meetings in the last decade where it became a badge of honor for bankers to give loans to those who could not afford them. From that came lesser rates, larger loans and chicanery galore.” With this came the perverse incentives of sub-prime lending: loans without down payments, loans without equity, loans without verification of income or assets. New lenders like Countrywide lent money without tempering the risk with savings deposits.
It worked, as long as the value of the underlying asset, the American home, kept increasing: If a homeowner couldn’t pay the mortgage, he could sell the home for a profit. In 1997, Bear Stearns started securitizing these poisoned loans, packaging and reselling the tainted candy in large, Wall Street-sized containers. More Wall Street money chased risky loans and more speculative borrowers chased easy money.
September 25, 2008 2:00 PM
The Tyranny of Good Intentions
Billing day.
By Alex Castellanos
Excerpts
And it’s Republicans who are bringing back the Era of Big Government. The New Deal set off a trend of higher taxes and more government that only got worse. Similarly, this generation will find it difficult to explain why the same paternal state we called upon to rescue Wall Street can’t bend down a little lower to provide government-paid health care, energy subsidies, and every imaginable social service.
So is this the time to pull our nation back from an economic precipice? Yes, for America cannot afford to play Russian roulette. If Congress votes down this bailout and our economy collapses, Americans will be at Washington’s door with torches and pitchforks. Remember when Republicans shut down the government? Imagine if Republicans shut down the economy. There is a liquidity crisis. Whether with loans or a bailout, our government must meet it.
Now, we must account for decisions made long ago. Washington’s dream was an America where every person could borrow enough money to buy a home. The Community Reinvestment Act, signed by President Carter and strengthened by Bill Clinton, encouraged bankers to loosen underwriting standards to “meet community needs.” Communities, of course, were not the ones obliged to pay the loans back.
As one former banker recently shared, “It is easy to recall sitting around bank board meetings in the last decade where it became a badge of honor for bankers to give loans to those who could not afford them. From that came lesser rates, larger loans and chicanery galore.” With this came the perverse incentives of sub-prime lending: loans without down payments, loans without equity, loans without verification of income or assets. New lenders like Countrywide lent money without tempering the risk with savings deposits.
It worked, as long as the value of the underlying asset, the American home, kept increasing: If a homeowner couldn’t pay the mortgage, he could sell the home for a profit. In 1997, Bear Stearns started securitizing these poisoned loans, packaging and reselling the tainted candy in large, Wall Street-sized containers. More Wall Street money chased risky loans and more speculative borrowers chased easy money.
Thursday, September 25, 2008
The Bailout
Leaving Nashville and the wonderful Hermitage Hotel On Tuesday I lucked onto the Senate Banking Committee Hearing with Bernanke from the Fed, Paulson from Treasury and Cox from the SEC. The entire meeting was broadcast on Sirius from Bloomberg, uninterrupted for over three hours. I felt like I got a semester’s worth of economics.
The Senators from both parties asked penetrating questions about the bailout and the political blame game was largely absent; the stakes and the urgency were just too great.
Here were a few of the points I can remember. Expect a lot of paraphrasing.
The main purpose is to protect the taxpayer. Paulson kept returning to this focus. Many senators sought to protect the homeowners from foreclosure. Paulson commented that while this was regrettable, some home owners were in houses they could not afford and could not be protected. Some of the senators wanted steps taken to punish the executives and companies who caused the mess.
While Paulson was equally outraged over the unfairness of some of the previous compensation paid to executives who had failed, his focus remained on saving the taxpayer from further damage. Many of the senators questioned what could be done to either get back previously paid bonuses or how to keep large bonuses from being paid to executives of some of the failing firms. Paulson noted several instances where golden parachutes will not be permitted, board fees will not be paid and how many of the shareholders will not be made whole. Retrieving bonuses paid in previous years may be a tougher accomplishment, and will not likely happen, unless outright fraud can be proven in a court.
There were several questions about how the auction of the assets would be handled. Bernanke said it would be a reverse auction which some of the senators probably did not understand. Their concern was that the Treasury armed with $700 billion in a market with few other bidders would just pay too much.
Bernanke explained that the mortgages had two prices; the fire sale price and the hold to maturity price. The cause of the liquidity crisis was that the banks under current regulations had to mark their assets to market which is currently the fire sale price. This reduces their ability to lend money to borrowers and causes the liquidity crisis.
Many of these mortgages will be held to maturity and are worth more than the fire sale price. But the market is in a decline and some fo the instruments are complicated and the market for them is so thin that there appears to be no market for them. By providing a floor and a market the Treasury bailout gives the banks an opportunity to get the non performing assets off their balance sheets.
Chuck Schumer wanted to know why the bailout amount had to be so high. Why could they not get a portion of it now and ask Congress for more if it appeared to be working? Paulson said that this would be disastrous, that the market needed reassurance that this problem could be fixed and that the commitment was solid. There are many unknowns and he did not want them to surface urgently while the Congress was in recess.
The amount would not be spent all at once, but would be truncated. They would probably group asset classes together when they were bought. Schumer also questioned the need for an FDIC type vehicle funded by premiums paid by the largest institutions. While this could be a part of future reform, Paulson indicated it was not nor should be a part of the bailout.
Senator Bayh questioned why private equity should not be required to participate in the auction, even to a point of only 10%. Paulson said that the more restrictions and the less flexibility that was put on the auction the less the chance of its success.
In creating a market, the Treasury will be buying the mortgages and selling them on the market in some measured way, as it did during the Resolution Trust Corporation (RTC) unwinding of the assets of the S&L fiasco. While they would expect to get much of the money back and could possibly earn a profit on the bailout, this depended on the unfolding of the housing market that was still uncertain and such an outcome could not be guaranteed.
Bernanke, a student of financial disasters, noted that this instance was different than bailing out a bunch of failed companies. The purpose here was not to keep a bunch of companies alive that were too big to fail, but to assure liquidity to the market to prevent an overall economic collapse and widespread unemployment.
Paulson, contrary to published reports to the contrary, expected and welcomed Congressional oversight and transparency; but the current plan is only an outline and there are many details to be worked out on its execution. All three noted urgency and that any effort to ‘attach’ items, become too punitive, or reduce flexibility to respond could be disastrous.
The Senators from both parties asked penetrating questions about the bailout and the political blame game was largely absent; the stakes and the urgency were just too great.
Here were a few of the points I can remember. Expect a lot of paraphrasing.
The main purpose is to protect the taxpayer. Paulson kept returning to this focus. Many senators sought to protect the homeowners from foreclosure. Paulson commented that while this was regrettable, some home owners were in houses they could not afford and could not be protected. Some of the senators wanted steps taken to punish the executives and companies who caused the mess.
While Paulson was equally outraged over the unfairness of some of the previous compensation paid to executives who had failed, his focus remained on saving the taxpayer from further damage. Many of the senators questioned what could be done to either get back previously paid bonuses or how to keep large bonuses from being paid to executives of some of the failing firms. Paulson noted several instances where golden parachutes will not be permitted, board fees will not be paid and how many of the shareholders will not be made whole. Retrieving bonuses paid in previous years may be a tougher accomplishment, and will not likely happen, unless outright fraud can be proven in a court.
There were several questions about how the auction of the assets would be handled. Bernanke said it would be a reverse auction which some of the senators probably did not understand. Their concern was that the Treasury armed with $700 billion in a market with few other bidders would just pay too much.
Bernanke explained that the mortgages had two prices; the fire sale price and the hold to maturity price. The cause of the liquidity crisis was that the banks under current regulations had to mark their assets to market which is currently the fire sale price. This reduces their ability to lend money to borrowers and causes the liquidity crisis.
Many of these mortgages will be held to maturity and are worth more than the fire sale price. But the market is in a decline and some fo the instruments are complicated and the market for them is so thin that there appears to be no market for them. By providing a floor and a market the Treasury bailout gives the banks an opportunity to get the non performing assets off their balance sheets.
Chuck Schumer wanted to know why the bailout amount had to be so high. Why could they not get a portion of it now and ask Congress for more if it appeared to be working? Paulson said that this would be disastrous, that the market needed reassurance that this problem could be fixed and that the commitment was solid. There are many unknowns and he did not want them to surface urgently while the Congress was in recess.
The amount would not be spent all at once, but would be truncated. They would probably group asset classes together when they were bought. Schumer also questioned the need for an FDIC type vehicle funded by premiums paid by the largest institutions. While this could be a part of future reform, Paulson indicated it was not nor should be a part of the bailout.
Senator Bayh questioned why private equity should not be required to participate in the auction, even to a point of only 10%. Paulson said that the more restrictions and the less flexibility that was put on the auction the less the chance of its success.
In creating a market, the Treasury will be buying the mortgages and selling them on the market in some measured way, as it did during the Resolution Trust Corporation (RTC) unwinding of the assets of the S&L fiasco. While they would expect to get much of the money back and could possibly earn a profit on the bailout, this depended on the unfolding of the housing market that was still uncertain and such an outcome could not be guaranteed.
Bernanke, a student of financial disasters, noted that this instance was different than bailing out a bunch of failed companies. The purpose here was not to keep a bunch of companies alive that were too big to fail, but to assure liquidity to the market to prevent an overall economic collapse and widespread unemployment.
Paulson, contrary to published reports to the contrary, expected and welcomed Congressional oversight and transparency; but the current plan is only an outline and there are many details to be worked out on its execution. All three noted urgency and that any effort to ‘attach’ items, become too punitive, or reduce flexibility to respond could be disastrous.
Something for Nothing
from Jeff Jacoby at the Boston Globe
Seeing through Obamanomics
By Jeff Jacoby
Globe Columnist / September 14, 2008
Taxation is not generosity, it is confiscation at gunpoint. Does Obama not understand the difference?
Perhaps he doesn't. Eager though he may be to compel "neighborliness" in others, he has not been nearly so avid about demonstrating it himself. Barack and Michelle Obama's tax returns show that from 2000 through 2004, when their adjusted gross income averaged nearly a quarter of a million dollars a year, their annual charitable donations amounted to just $2,154 -- less than nine-tenths of 1 percent. Not until he entered the US Senate in 2005 and began to be spoken of as a presidential possibility did the Obamas' "neighborliness" become more evident. (In 2005-2007, they gave 5.5 percent of their income to charity.)
Obama claims his proposal would lower taxes for 95 percent of Americans, but well over 43 million tax returns, one-third of all those filed, already reflect an income tax liability of zero. In fact, Obama says, his plan would eliminate income taxes for an additional 10 million taxpayers.
What he is really proposing, therefore, is not tax relief but a bald transfer of cash -- $1,000 per family, he pledges -- from the wealthiest Americans to everyone else. In 1972, George McGovern advocated something similar -- a $1,000 "demogrant" for every US citizen. Just last year, Hillary Clinton suggested that the government start off every new baby with a $5,000 savings account. Voters didn't take the bait when McGovern and Clinton offered it. Here's betting they won't take it now.
Why not? Because you don't have to be rich to be skeptical when a candidate argues that the top 1 percent of taxpayers, who earn 22 percent of the income in this country but pay 40 percent of the income taxes, aren't being taxed enough. Nor do you have to be an economist to wonder about the grasp of a nominee who tells 95 percent of the public that they can have something for nothing. Obamanomics may look pretty at first glance. But voters are focusing more closely now, and they can see beyond the lipstick.
Seeing through Obamanomics
By Jeff Jacoby
Globe Columnist / September 14, 2008
Taxation is not generosity, it is confiscation at gunpoint. Does Obama not understand the difference?
Perhaps he doesn't. Eager though he may be to compel "neighborliness" in others, he has not been nearly so avid about demonstrating it himself. Barack and Michelle Obama's tax returns show that from 2000 through 2004, when their adjusted gross income averaged nearly a quarter of a million dollars a year, their annual charitable donations amounted to just $2,154 -- less than nine-tenths of 1 percent. Not until he entered the US Senate in 2005 and began to be spoken of as a presidential possibility did the Obamas' "neighborliness" become more evident. (In 2005-2007, they gave 5.5 percent of their income to charity.)
Obama claims his proposal would lower taxes for 95 percent of Americans, but well over 43 million tax returns, one-third of all those filed, already reflect an income tax liability of zero. In fact, Obama says, his plan would eliminate income taxes for an additional 10 million taxpayers.
What he is really proposing, therefore, is not tax relief but a bald transfer of cash -- $1,000 per family, he pledges -- from the wealthiest Americans to everyone else. In 1972, George McGovern advocated something similar -- a $1,000 "demogrant" for every US citizen. Just last year, Hillary Clinton suggested that the government start off every new baby with a $5,000 savings account. Voters didn't take the bait when McGovern and Clinton offered it. Here's betting they won't take it now.
Why not? Because you don't have to be rich to be skeptical when a candidate argues that the top 1 percent of taxpayers, who earn 22 percent of the income in this country but pay 40 percent of the income taxes, aren't being taxed enough. Nor do you have to be an economist to wonder about the grasp of a nominee who tells 95 percent of the public that they can have something for nothing. Obamanomics may look pretty at first glance. But voters are focusing more closely now, and they can see beyond the lipstick.
Wednesday, September 24, 2008
The Intersection of Wall Street and Main Street
by Henry Oliner
Today DayJet suspended its operation out of Macon, claiming it could not get the operating capital it needed.
Bill Heard closed all nine of its dealerships, including 4 in the Metro Atlanta area, unable to get GMAC financing.
For sure there may have been other business problems for these two enterprises, but unless the current Wall Street credit crisis is resolved, you can expect to see many such businesses close.
There are two critical points we must understand.
1. This is not a bailout of failing institutions, it is a liquidity crisis caused by several problems in addition to irresponsible management. It is a perfect storm of faulty regulations, bank rules, monetary instability, a real estate collapse, and various forms of management incompetence and fraud.
2. This is the intersection of Wall Street and Main Street. It is not an us or them choice. Without the needed liquidity there will be endless DayJets and Bill Heards closing. Small business will not be able to maintain their operating lines of credit and unemployment will soar.
I share many of the concerns of excessive pay and these should be controlled where possible, but the effort to restore liquidity rapidly is paramount. Save the system now, weed out the wrong doers later.
And yes, this is important enough to suspend the campaign for a week. McCain is where he should be; Obama is not..... yet.
Today DayJet suspended its operation out of Macon, claiming it could not get the operating capital it needed.
Bill Heard closed all nine of its dealerships, including 4 in the Metro Atlanta area, unable to get GMAC financing.
For sure there may have been other business problems for these two enterprises, but unless the current Wall Street credit crisis is resolved, you can expect to see many such businesses close.
There are two critical points we must understand.
1. This is not a bailout of failing institutions, it is a liquidity crisis caused by several problems in addition to irresponsible management. It is a perfect storm of faulty regulations, bank rules, monetary instability, a real estate collapse, and various forms of management incompetence and fraud.
2. This is the intersection of Wall Street and Main Street. It is not an us or them choice. Without the needed liquidity there will be endless DayJets and Bill Heards closing. Small business will not be able to maintain their operating lines of credit and unemployment will soar.
I share many of the concerns of excessive pay and these should be controlled where possible, but the effort to restore liquidity rapidly is paramount. Save the system now, weed out the wrong doers later.
And yes, this is important enough to suspend the campaign for a week. McCain is where he should be; Obama is not..... yet.
Another Prediction Fulfilled
On Monday September 15, the Dow dropped 504 points. Being the contrarian that I am I predicted on this blog at the end of that day that the week would end higher than it started.
On Tuesday it gained 141, on Wednesday it dropped a whopping 449, and then it finished up 410 on Thursday and up 368 on Friday.
While the Dow was down a mere 33 points, the S&P 500 ended up with a net gain of 62 points. The Dow was down a net of .31% and the S&P 500 was UP 5.23%.
I still call this prediction a victory, on par with my prediction in my blog on June 30 that the price of oil would drop to below $100 a barrel in six months. Last week it reached $98 a barrel before the recent rebound.
When big sudden moves are surrounded with fear and greed the contrarian bet is a sound one, even if it is not always correct.
On Tuesday it gained 141, on Wednesday it dropped a whopping 449, and then it finished up 410 on Thursday and up 368 on Friday.
While the Dow was down a mere 33 points, the S&P 500 ended up with a net gain of 62 points. The Dow was down a net of .31% and the S&P 500 was UP 5.23%.
I still call this prediction a victory, on par with my prediction in my blog on June 30 that the price of oil would drop to below $100 a barrel in six months. Last week it reached $98 a barrel before the recent rebound.
When big sudden moves are surrounded with fear and greed the contrarian bet is a sound one, even if it is not always correct.
401-K Nation
Zogby in his great book, “The Way We’ll Be” observes that how you categorize the voters can clarify the results of polling tremendously.
While the common media still clings to old perceptions of race and sex, people today think in terms of other groups.
In the 2004 election 61% of the voters who identified themselves as investors voted for Bush.
Whether they were a union member, young (18-29), women, Hispanic, middle income (50k-75k) or single; they were more likely to vote Republican if they identified themselves as investors.
2 in 5 of those who identified themselves as investors had portfolios of less than $50,000; 3 in 5 had portfolios of less than $100,000.
A majority of Americans (52%) identified themselves as investors in a Zogby poll in July , 2007- a number that has been steadily growing.
HKO Comments- Obama’s tax policy to raise taxes on dividends and capital gains attacks the new investor class. Obama is very conservatively invested in mostly fixed income which has been a smart place to be for the last year, but it may also distance himself from some of the concerns of the investor class.
His campaign would be smart to move beyond the old divisions of race and gender. Focus on how the voters see themselves.
While the common media still clings to old perceptions of race and sex, people today think in terms of other groups.
In the 2004 election 61% of the voters who identified themselves as investors voted for Bush.
Whether they were a union member, young (18-29), women, Hispanic, middle income (50k-75k) or single; they were more likely to vote Republican if they identified themselves as investors.
2 in 5 of those who identified themselves as investors had portfolios of less than $50,000; 3 in 5 had portfolios of less than $100,000.
A majority of Americans (52%) identified themselves as investors in a Zogby poll in July , 2007- a number that has been steadily growing.
HKO Comments- Obama’s tax policy to raise taxes on dividends and capital gains attacks the new investor class. Obama is very conservatively invested in mostly fixed income which has been a smart place to be for the last year, but it may also distance himself from some of the concerns of the investor class.
His campaign would be smart to move beyond the old divisions of race and gender. Focus on how the voters see themselves.
The Other Road to Hell
From John Zogby's "The Way We'll Be"
"The road to hell is paved with sterotypes. To cite one example, Christian conservatives, especially those under thirty, have moved far beyond their putative spokesmen on issues such as stem cell research, global warming, and health care. Meet people where they are, not where they used to be."
"Institution authority is all but dead and gone. Self reliance and self determination is on the rise."
"Since early 2006, Zogby International has been tracking the growing moderation among evangelicals and born-agains. It's a very real phenomenon."
"The road to hell is paved with sterotypes. To cite one example, Christian conservatives, especially those under thirty, have moved far beyond their putative spokesmen on issues such as stem cell research, global warming, and health care. Meet people where they are, not where they used to be."
"Institution authority is all but dead and gone. Self reliance and self determination is on the rise."
"Since early 2006, Zogby International has been tracking the growing moderation among evangelicals and born-agains. It's a very real phenomenon."
Tuesday, September 23, 2008
Buffets Rules for Boards
from Douglass Ott's "Yes and Not Yes" (see recommended sites)
A Failure of Corporate Governance
Published
by
Doug
on September 17, 2008
in Corporate Governance and Law. 1 Comment
Writing about the failed financial institutions, Carl Icahn feels “it is difficult to see how one could reach any conclusion other than that the boards of directors of a number of these imploded financial firms utterly failed to successfully implement some of their primary tasks - to oversee management and monitor and evaluate risk controls.”
I concur with Carl. The problem with these failed institutions was excessive risk-taking and excessive leverage. Each one of these failed institutions had boards of directors to watch over management, so what went wrong with these directors?
First there is the problem that these board members are most likely paid far too much for doing far too little. The board seat might even constitute a substantial portion of the board member’s total salary. With high compensation, it is little wonder that a director would not want to challenge management lest he or she be terminated and lose that easy money.
One idea I have to foster an environment in which a board of directors takes a more active role in monitoring a company is to codify Warren Buffett’s requirements for his BoD. Buffett’s rules are very simple and are designed to align the director’s interests with the shareholders: (1) the director must be a longtime shareholder, (2) a substantial shareholder, and (3) the must only receive minimal compensation.
Buffett’s easy rules for directors would be an excellent start and I think much preferable to more minute, detailed regulations that would continue to ratchet up costs of compliance with the SEC.
A Failure of Corporate Governance
Published
by
Doug
on September 17, 2008
in Corporate Governance and Law. 1 Comment
Writing about the failed financial institutions, Carl Icahn feels “it is difficult to see how one could reach any conclusion other than that the boards of directors of a number of these imploded financial firms utterly failed to successfully implement some of their primary tasks - to oversee management and monitor and evaluate risk controls.”
I concur with Carl. The problem with these failed institutions was excessive risk-taking and excessive leverage. Each one of these failed institutions had boards of directors to watch over management, so what went wrong with these directors?
First there is the problem that these board members are most likely paid far too much for doing far too little. The board seat might even constitute a substantial portion of the board member’s total salary. With high compensation, it is little wonder that a director would not want to challenge management lest he or she be terminated and lose that easy money.
One idea I have to foster an environment in which a board of directors takes a more active role in monitoring a company is to codify Warren Buffett’s requirements for his BoD. Buffett’s rules are very simple and are designed to align the director’s interests with the shareholders: (1) the director must be a longtime shareholder, (2) a substantial shareholder, and (3) the must only receive minimal compensation.
Buffett’s easy rules for directors would be an excellent start and I think much preferable to more minute, detailed regulations that would continue to ratchet up costs of compliance with the SEC.
Retail Politics
Pollster John Zogby’s new book, “The Way We’ll Be” is loaded with interesting insights to America’s voting and buying patterns.
“In 2004, when John Kerry lost the popular vote by only 3%, he lost among weekly Wal-Mart shoppers by a whopping 76% to 24%. Meanwhile those who told they “never” shop at Wal-Mart went just the opposite direction, voting 80% for Kerry and 18% for Bush.”
Paraphrased-
Conservatives prefer Wal-Mart, then Sears (57-16), JC Penny (50-21), Kohl’s (50-23), Boscov’s (53-26), and Kaufman’s (46-29).
Liberals prefer Filene’s (51-29), Bloomingdale’s (48-26), Macy’s (42-32), Neiman Marcus (39-30), and Target (39-36). (We hear about the "rich" Republicans, but it seems the Liberals prefer the high ticket retailers- maybe that is why the Republicans are rich.)
Zogby excluded Bass Pro Shop. I guess it was just too obvious.
“In 2004, when John Kerry lost the popular vote by only 3%, he lost among weekly Wal-Mart shoppers by a whopping 76% to 24%. Meanwhile those who told they “never” shop at Wal-Mart went just the opposite direction, voting 80% for Kerry and 18% for Bush.”
Paraphrased-
Conservatives prefer Wal-Mart, then Sears (57-16), JC Penny (50-21), Kohl’s (50-23), Boscov’s (53-26), and Kaufman’s (46-29).
Liberals prefer Filene’s (51-29), Bloomingdale’s (48-26), Macy’s (42-32), Neiman Marcus (39-30), and Target (39-36). (We hear about the "rich" Republicans, but it seems the Liberals prefer the high ticket retailers- maybe that is why the Republicans are rich.)
Zogby excluded Bass Pro Shop. I guess it was just too obvious.
Monday, September 22, 2008
Deadly Health Care Options
Another reason to be concerned about government controlled health care:
from American Thinker
September 14, 2008
Oregon's Suicidal Approach to Health Care
By Rita L. Marker
excerpt
Oregon seems to have found a surefire way to lower health care costs: Tell the patient you'll pay for drugs that will end her life, but not those that would extend her life. Here's how it works:
In May 2008, 64-year-old retired school bus driver Barbara Wagner received bad news from her doctor. She found out that her cancer, which had been in remission for two years, had returned. Then, she got some good news. Her doctor gave her a prescription that would likely slow the cancer's growth and extend her life. She was relieved by the news and also by the fact that she had health care coverage through the Oregon Health Plan.
It didn't take long for her hopes to be dashed.
Barbara Wagner was notified by letter that the Oregon Health Plan wouldn't cover her prescription. But the letter didn't leave it at that. It also notified her that, although it wouldn't cover her prescription, it would cover assisted suicide.
from American Thinker
September 14, 2008
Oregon's Suicidal Approach to Health Care
By Rita L. Marker
excerpt
Oregon seems to have found a surefire way to lower health care costs: Tell the patient you'll pay for drugs that will end her life, but not those that would extend her life. Here's how it works:
In May 2008, 64-year-old retired school bus driver Barbara Wagner received bad news from her doctor. She found out that her cancer, which had been in remission for two years, had returned. Then, she got some good news. Her doctor gave her a prescription that would likely slow the cancer's growth and extend her life. She was relieved by the news and also by the fact that she had health care coverage through the Oregon Health Plan.
It didn't take long for her hopes to be dashed.
Barbara Wagner was notified by letter that the Oregon Health Plan wouldn't cover her prescription. But the letter didn't leave it at that. It also notified her that, although it wouldn't cover her prescription, it would cover assisted suicide.
Sunday, September 21, 2008
Change on the Cheap
from Tax Prof Blog
Perhaps the Obama-Biden campaign needs a new slogan: "Change You Can Believe In (As Long As Someone Else Pays For It)"
Joe Biden today released ten years of his personal income tax returns, drawing further attention to the tax issues raised by Sarah Palin's tax problems associated with her per diem reimbursements while governor of Alaska.
I wonder, though, if the move might backfire because the returns show that the Bidens have been amazingly tight-fisted when it comes to their charitable giving. Despite income ranging from $210,432 - $321,379 over the ten-year period, the Bidens have given only $120 - $995 per year to charity, which amounts to 0.06% - 0.31% of their income:
It is jarring that a couple earning over $200,000 per year would give as little as $2 per week to charity. This giving compares very unfavorably to John McCain, whose tax returns show that he gave 27.3% - 28.6% of his income to charity in 2006-2007. During the same period, the Obamas' tax returns show that they gave 5.8% - 6.1% of their income to charity.
HKO- Comments- In Who Really Cares: The Surprising Truth About Compassionate Conservatism and Who Gives, Who Doesn't, and Why it Matters by Arthur Brooks, the author prints substantial research showing Conservatives are far more charitable than Democrats.
Perhaps the Obama-Biden campaign needs a new slogan: "Change You Can Believe In (As Long As Someone Else Pays For It)"
Joe Biden today released ten years of his personal income tax returns, drawing further attention to the tax issues raised by Sarah Palin's tax problems associated with her per diem reimbursements while governor of Alaska.
I wonder, though, if the move might backfire because the returns show that the Bidens have been amazingly tight-fisted when it comes to their charitable giving. Despite income ranging from $210,432 - $321,379 over the ten-year period, the Bidens have given only $120 - $995 per year to charity, which amounts to 0.06% - 0.31% of their income:
It is jarring that a couple earning over $200,000 per year would give as little as $2 per week to charity. This giving compares very unfavorably to John McCain, whose tax returns show that he gave 27.3% - 28.6% of his income to charity in 2006-2007. During the same period, the Obamas' tax returns show that they gave 5.8% - 6.1% of their income to charity.
HKO- Comments- In Who Really Cares: The Surprising Truth About Compassionate Conservatism and Who Gives, Who Doesn't, and Why it Matters by Arthur Brooks, the author prints substantial research showing Conservatives are far more charitable than Democrats.
Saturday, September 20, 2008
The Big Bust Bonus Bailout
I remember how in the laste 1980's Michael Milken 'earned' a $500 million dollar bonus and the following year his employer, old line brokerage house Drexel Burnham went out of business.
With the federal government having to bail out so many firms including most recently AIG, they should cap these obscene bonuses. Though the bonuses may seem small compared to the billions of dollars required to bail these firms out, the taxpayers should demand it.
I would like to see SEC approval of any bonus in excess of 5 million dollars in a single year. Of course this would not have covered Fannie Mae or Freddie Mac since Congress specifically exempted them from SEC oversight in favor of Congressional steering.
Such large bonuses should be required to be paid out over five or ten years and should be subject to recall if the firm falters. Such recipients of such largesse should be held accountable to for the long term performance of the firm, not the recent quarter or the recent year.
The detailed structure of these bailouts is above my pay grade, but I hope the government takes enough control that they can be repaid for their risk with interest over whatever period of time is necessary.
We don't want to encourage the government to take over mismananged or failing firms. But if it becomes necessary as it has, it should be painful enough to the management and the shareholders that they would want to avoid it at all costs.
Whatever good comes out of this period of severe financial turmoil I hope the age of obscene excecutive bonuses and the focus on short term results comes to an end.
With the federal government having to bail out so many firms including most recently AIG, they should cap these obscene bonuses. Though the bonuses may seem small compared to the billions of dollars required to bail these firms out, the taxpayers should demand it.
I would like to see SEC approval of any bonus in excess of 5 million dollars in a single year. Of course this would not have covered Fannie Mae or Freddie Mac since Congress specifically exempted them from SEC oversight in favor of Congressional steering.
Such large bonuses should be required to be paid out over five or ten years and should be subject to recall if the firm falters. Such recipients of such largesse should be held accountable to for the long term performance of the firm, not the recent quarter or the recent year.
The detailed structure of these bailouts is above my pay grade, but I hope the government takes enough control that they can be repaid for their risk with interest over whatever period of time is necessary.
We don't want to encourage the government to take over mismananged or failing firms. But if it becomes necessary as it has, it should be painful enough to the management and the shareholders that they would want to avoid it at all costs.
Whatever good comes out of this period of severe financial turmoil I hope the age of obscene excecutive bonuses and the focus on short term results comes to an end.
The Christaphobics
I find it interesting to see in the e-mails and blogs from the left how they attack Palin because of her controversial, radical, extremist church, yet they have no problem with Barak's 15 year relationship with Reverend Wright.
I do not agree with some of the stances from her church, but I am not concerned that she is about to restoke the flames of the Inquisition and declare all other faiths heretics.
I am not a Christian, but I am not a Christaphobic, which would be a fear of Christians or Christians who fearlessly and openly profess their faith.
Remember the disgust the media had with Bush during his first campaign when he replied, "Jesus Christ" to the question of who his greatest influence was?
I do not agree with some of the stances from her church, but I am not concerned that she is about to restoke the flames of the Inquisition and declare all other faiths heretics.
I am not a Christian, but I am not a Christaphobic, which would be a fear of Christians or Christians who fearlessly and openly profess their faith.
Remember the disgust the media had with Bush during his first campaign when he replied, "Jesus Christ" to the question of who his greatest influence was?
Friday, September 19, 2008
Obama's Fatal Flaw
Excellent article in Asia Times'
Sep 3, 2008
How Obama lost the election
By Spengler
excerpts
"[Obama's] recital of a long list of domestic promises could have been delivered by
any Democratic nominee from Walter Mondale to John Kerry. There was no theme music to the speech and really no phrase or sentence that is likely to linger in the memory of any listener. The thing I never expected did in fact occur: Al Gore, the famously wooden former vice president, gave a more lively and convincing speech than Obama did."
The longer the candidate spoke, and the more money he promised to spend on alternative energy, preschool education, universal health care, and other components of the Democratic pinata, the lower the party professionals slouched into their seats.
...rejecting Clinton in favor of the colorless, unpopular, tangle-tongued Washington perennial Joe Biden was a statement of weakness. McCain's selection was a statement of strength. America's voters will forgive many things in a politician, including sexual misconduct, but they will not forgive weakness.
That is why McCain will win in November, and by a landslide, barring some unforeseen event. Obama is the most talented and persuasive politician of his generation, the intellectual superior of all his competitors, but a fatally insecure personality. American voters are not intellectual, but they are shrewd, like animals. They can smell insecurity, and the convention stank of it.
Biden, who won 3% of the popular vote in the Democratic presidential primary in his home state of Delaware, and 1% or less in every other contest he entered, is ballot-box poison. Obama evidently chose him to assuage critics who point to his lack of foreign policy credentials. That was a deadly error, for by appearing to concede the critics' claim that he knows little about foreign policy, Obama raised questions about whether he is qualified to be president in the first place.
McCain doesn't have a tenth of Obama's synaptic fire-power, but he is a nasty old sailor who knows when to come about for a broadside. Given Obama's defensive, even wimpy selection of a running-mate, McCain's choice was obvious. He picked the available candidate most like himself: a maverick with impeccable reform credentials, a risk-seeking commercial fisherwoman and huntress married to a marathon snowmobile racer who carries a steelworkers union card.
The young Alaskan governor, to be sure, hasn't any business running for vice president of the United States with her thin resume. McCain and his people know this perfectly well, and that is precisely why they put her on the ticket. If Palin is unqualified to be vice president, all the less so is Obama qualified to be president.
Obama, in short, is long on brains and short on guts. A Shibboleth of American politics holds that different tactics are required to win the party primaries as opposed to the general election, that is, by pandering to fringe groups with disproportionate influence in the primaries.
No country's politics depends more openly on friendships than America's, yet Obama has not a single real friend, for he rose so fast that all his acquaintances become rungs on the ladder of his ascent. One human relationship crowds the others out of his life, his marriage to Michelle, a strong, assertive and very angry woman.
If Novak's report is accurate, then Michelle's anger will have lost the election for Obama,
Please read the entire article- it was so good that it was hard to condense and there is much I omitted.
Tips to my old college buddy, Bob Cain, for the tip.
Sep 3, 2008
How Obama lost the election
By Spengler
excerpts
"[Obama's] recital of a long list of domestic promises could have been delivered by
any Democratic nominee from Walter Mondale to John Kerry. There was no theme music to the speech and really no phrase or sentence that is likely to linger in the memory of any listener. The thing I never expected did in fact occur: Al Gore, the famously wooden former vice president, gave a more lively and convincing speech than Obama did."
The longer the candidate spoke, and the more money he promised to spend on alternative energy, preschool education, universal health care, and other components of the Democratic pinata, the lower the party professionals slouched into their seats.
...rejecting Clinton in favor of the colorless, unpopular, tangle-tongued Washington perennial Joe Biden was a statement of weakness. McCain's selection was a statement of strength. America's voters will forgive many things in a politician, including sexual misconduct, but they will not forgive weakness.
That is why McCain will win in November, and by a landslide, barring some unforeseen event. Obama is the most talented and persuasive politician of his generation, the intellectual superior of all his competitors, but a fatally insecure personality. American voters are not intellectual, but they are shrewd, like animals. They can smell insecurity, and the convention stank of it.
Biden, who won 3% of the popular vote in the Democratic presidential primary in his home state of Delaware, and 1% or less in every other contest he entered, is ballot-box poison. Obama evidently chose him to assuage critics who point to his lack of foreign policy credentials. That was a deadly error, for by appearing to concede the critics' claim that he knows little about foreign policy, Obama raised questions about whether he is qualified to be president in the first place.
McCain doesn't have a tenth of Obama's synaptic fire-power, but he is a nasty old sailor who knows when to come about for a broadside. Given Obama's defensive, even wimpy selection of a running-mate, McCain's choice was obvious. He picked the available candidate most like himself: a maverick with impeccable reform credentials, a risk-seeking commercial fisherwoman and huntress married to a marathon snowmobile racer who carries a steelworkers union card.
The young Alaskan governor, to be sure, hasn't any business running for vice president of the United States with her thin resume. McCain and his people know this perfectly well, and that is precisely why they put her on the ticket. If Palin is unqualified to be vice president, all the less so is Obama qualified to be president.
Obama, in short, is long on brains and short on guts. A Shibboleth of American politics holds that different tactics are required to win the party primaries as opposed to the general election, that is, by pandering to fringe groups with disproportionate influence in the primaries.
No country's politics depends more openly on friendships than America's, yet Obama has not a single real friend, for he rose so fast that all his acquaintances become rungs on the ladder of his ascent. One human relationship crowds the others out of his life, his marriage to Michelle, a strong, assertive and very angry woman.
If Novak's report is accurate, then Michelle's anger will have lost the election for Obama,
Please read the entire article- it was so good that it was hard to condense and there is much I omitted.
Tips to my old college buddy, Bob Cain, for the tip.
Thursday, September 18, 2008
YouTubing Obama
You Tubing the Campaign
On an interview with George Stephanopolis supposedly Obama admits to being a Muslim. He refers to his Muslim faith and George corrected him to mean his "Christian faith". See the video here.
In context it appears to be another gaffe. He is probably referring to the people who try to infer that he is a Muslim despite his denials. Still many people consider this a gaffe that they can not envision themselves making.
Yet in the world of YouTube this small segment has been viewed over 175,000 times, at a cost to the McCain Campaign of $ 0.
The Reverend Wright videos have been viewed over 300,000 times. Actually they have been viewed much more- three different videos have had hundreds of thousands of views.
YouTube is ripe with videos replayed from Hillary, Biden, Carter and Dodd about how Obama is not qualified. Biden and Hillary even praised McCain over Obama. They may have changed in Denver but the YouTubers play on.
One YouTube even replays Obama's own words about how he is unqualified.
All of this costs the McCain camp nothing and is independent of the main street media. Yes there are videos critical of McCain as well, but check the viewership. Analsysts will be absorbing this new phenomenon for years to come.
On an interview with George Stephanopolis supposedly Obama admits to being a Muslim. He refers to his Muslim faith and George corrected him to mean his "Christian faith". See the video here.
In context it appears to be another gaffe. He is probably referring to the people who try to infer that he is a Muslim despite his denials. Still many people consider this a gaffe that they can not envision themselves making.
Yet in the world of YouTube this small segment has been viewed over 175,000 times, at a cost to the McCain Campaign of $ 0.
The Reverend Wright videos have been viewed over 300,000 times. Actually they have been viewed much more- three different videos have had hundreds of thousands of views.
YouTube is ripe with videos replayed from Hillary, Biden, Carter and Dodd about how Obama is not qualified. Biden and Hillary even praised McCain over Obama. They may have changed in Denver but the YouTubers play on.
One YouTube even replays Obama's own words about how he is unqualified.
All of this costs the McCain camp nothing and is independent of the main street media. Yes there are videos critical of McCain as well, but check the viewership. Analsysts will be absorbing this new phenomenon for years to come.
Obama as Jesus
Master blogger Erick Erickson smacks the "Obama as Jesus" analogy at his "Confessions of a Political Junkie"-
exerpts
Being a partisan, I want to win this election. And I think you lefties have come upon a winning strategy to help us do it. The whole “Jesus is to Obama as Pontius Pilate is to Sarah Palin” analogy will do nothing but inflame the senses of the evangelical community, others who recognize the offensiveness of the statement, and the edge of voters needed to push John McCain toward victory.
To say that Christ is a community organizer demeans the Savior of mankind and denies Him for who He is. Saul Alinsky, the man who, to quote Wikipedia, “is often credited with laying the foundation for the grassroots political organizing that dominated the 1960s” dedicated his book that started the community organizer fad to Lucifer — “the very first radical.” Lucifer was a community organizer in he Alinsky model. Lucifer convinced Adam and Eve of a reality not quite real and caused the world’s problems.
That is what a community organizer does. He convinces people that a problem barely perceived is very real and incites the community to fix the problem — no matter that the problem may be nonexistent or, if existent, a small matter. That is why Alinsky dedicated his book to Lucifer.
exerpts
Being a partisan, I want to win this election. And I think you lefties have come upon a winning strategy to help us do it. The whole “Jesus is to Obama as Pontius Pilate is to Sarah Palin” analogy will do nothing but inflame the senses of the evangelical community, others who recognize the offensiveness of the statement, and the edge of voters needed to push John McCain toward victory.
To say that Christ is a community organizer demeans the Savior of mankind and denies Him for who He is. Saul Alinsky, the man who, to quote Wikipedia, “is often credited with laying the foundation for the grassroots political organizing that dominated the 1960s” dedicated his book that started the community organizer fad to Lucifer — “the very first radical.” Lucifer was a community organizer in he Alinsky model. Lucifer convinced Adam and Eve of a reality not quite real and caused the world’s problems.
That is what a community organizer does. He convinces people that a problem barely perceived is very real and incites the community to fix the problem — no matter that the problem may be nonexistent or, if existent, a small matter. That is why Alinsky dedicated his book to Lucifer.
Wednesday, September 17, 2008
The Junkie's Dilemma
by Henry Oliner
The history of Fannie Mae and Freddie Mac dates back to FDR and LBJ. Their mission was to provide mortgage loans to middle and lower income citizens. But like so many popular government programs (including health care) they want to provide more benefits than they are willing to pay for.
Mortgage lending like any other lending is relatively simple. You will loan based either on the value of the asset or based on the ability of the borrower to pay it back. To guard against the drop in the price of the asset, you will protect yourself by asking the borrower to put up a down payment. In the 1960’s and 70’s you generally expected to put down 20% of the price of the home in order to borrow the remaining 80%. You had to prove yourself a dependable income source with a good credit history and a good personal history from either education or job recommendation.
As housing prices grew the 20% down payment became onerous and the politicians wanted to help the poorer realize the American dream of home ownership. Down payments slipped to 10% or even less, often with a higher accompanying interest rate.
Under Reagan the interest on consumer loans such as credit cards was no longer deductable. People discovered, and banks pushed equity lines of credit. Simply borrow from the asset value of your home and pay off your credit cards with tax deductable interest.
Mortgage lenders started making loans of 100% or 110% or even 125% of the asset. This was the beginning of the end. When this many people believe that appreciation of homes is inevitable the top must be near. When home owners lost their jobs they would just walk away from the home and leave it to the bank. Having no equity they had nothing to lose. This was common in Houston during the oil bust of the 1980’s.
As local loans became commoditized, the security of the loan weakened considerably. Banks no longer kept the local loan on their books and profited from the cash flow of a quality loans of their own choosing that they owned; they were now paid fees to originate loans that were then sold and resold to Wall Street firms who marketed them as mortgage backed obligations.
The banks became distant from their loans, the fees became generous, and the quality suffered. Ridiculous incentives were paid to generate new loans with no penalty left for making poor loans. Short term pleasure for possible long term pain- the junkie’s dilemma.
To help people qualify for loans the financial institutions, with the blessings of the government regulators and oversight committees, invented ARMS, interest only, and then they just fudged appraisals and income qualifications. Creativity and rationalizations abounded to support popular delusions.
But at the core of this problem is that the government wanted to give something for nothing. By making loans available for people who could not afford them they ignored the long term risk, basically giving away risk coverage for free. This is like an insurance company offering you free insurance for your car and still expecting you to drive safe. Would you want to buy their shares?
The rest of the story is a story of fraud, cover up and politics designed to hide the basic and obvious truth. They distributed fashion awards (bonuses) to naked emperors.
The history of Fannie Mae and Freddie Mac dates back to FDR and LBJ. Their mission was to provide mortgage loans to middle and lower income citizens. But like so many popular government programs (including health care) they want to provide more benefits than they are willing to pay for.
Mortgage lending like any other lending is relatively simple. You will loan based either on the value of the asset or based on the ability of the borrower to pay it back. To guard against the drop in the price of the asset, you will protect yourself by asking the borrower to put up a down payment. In the 1960’s and 70’s you generally expected to put down 20% of the price of the home in order to borrow the remaining 80%. You had to prove yourself a dependable income source with a good credit history and a good personal history from either education or job recommendation.
As housing prices grew the 20% down payment became onerous and the politicians wanted to help the poorer realize the American dream of home ownership. Down payments slipped to 10% or even less, often with a higher accompanying interest rate.
Under Reagan the interest on consumer loans such as credit cards was no longer deductable. People discovered, and banks pushed equity lines of credit. Simply borrow from the asset value of your home and pay off your credit cards with tax deductable interest.
Mortgage lenders started making loans of 100% or 110% or even 125% of the asset. This was the beginning of the end. When this many people believe that appreciation of homes is inevitable the top must be near. When home owners lost their jobs they would just walk away from the home and leave it to the bank. Having no equity they had nothing to lose. This was common in Houston during the oil bust of the 1980’s.
As local loans became commoditized, the security of the loan weakened considerably. Banks no longer kept the local loan on their books and profited from the cash flow of a quality loans of their own choosing that they owned; they were now paid fees to originate loans that were then sold and resold to Wall Street firms who marketed them as mortgage backed obligations.
The banks became distant from their loans, the fees became generous, and the quality suffered. Ridiculous incentives were paid to generate new loans with no penalty left for making poor loans. Short term pleasure for possible long term pain- the junkie’s dilemma.
To help people qualify for loans the financial institutions, with the blessings of the government regulators and oversight committees, invented ARMS, interest only, and then they just fudged appraisals and income qualifications. Creativity and rationalizations abounded to support popular delusions.
But at the core of this problem is that the government wanted to give something for nothing. By making loans available for people who could not afford them they ignored the long term risk, basically giving away risk coverage for free. This is like an insurance company offering you free insurance for your car and still expecting you to drive safe. Would you want to buy their shares?
The rest of the story is a story of fraud, cover up and politics designed to hide the basic and obvious truth. They distributed fashion awards (bonuses) to naked emperors.
Diluting Hot Button Issues
According the popular web site and book, “Stuff White People Like”, one of the long listed items is “Irony”.
So here is my irony observation on this political contest. By picking a candidate, Obama, that is so far left, the Democratic Party has widened the range of topics that strongly differentiates the two parties. Because they are so different on so many issues no single issue carries dominating force.
As a result one of the issues that is most central to the left, abortion rights, has lost its weight. Most Americans are pro choice but it is both less of a litmus test issue, and less important than the economy and national security where there is a strong perceived difference in the candidates.
If the two candidates were both closer to the center, abortion rights would be more central to this campaign.
So here is my irony observation on this political contest. By picking a candidate, Obama, that is so far left, the Democratic Party has widened the range of topics that strongly differentiates the two parties. Because they are so different on so many issues no single issue carries dominating force.
As a result one of the issues that is most central to the left, abortion rights, has lost its weight. Most Americans are pro choice but it is both less of a litmus test issue, and less important than the economy and national security where there is a strong perceived difference in the candidates.
If the two candidates were both closer to the center, abortion rights would be more central to this campaign.
Higher Gas Prices Saves Lives
Apparently highway accidents are down because gas prices are high.
People are driving less, particularly the young and the elderly who are impacted most by higher fuel prices. These are also two groups with higher accident rates. Do the math.
People are driving less, particularly the young and the elderly who are impacted most by higher fuel prices. These are also two groups with higher accident rates. Do the math.
Voter Credit
By Henry Oliner
9/17/2008 4:16 AM
We are midway into a week of financial crisis, and the blogosphere writers seek the insights to explain it all. While this debacle has a long complicated history, the basics are really pretty simple.
The placement of these events 7 weeks before the most contentious presidential election in memory inevitably will have the candidates and their parties politicizing the bailouts. But campaign sound bites are not conducive to understanding such events.
But any attempts to blame the “other” party will backfire. There are plenty of Democratic fingerprints on this smoking gun. Why was Fannie Mae exempt from SEC oversight and subject only to Congressional oversight.... and who has controlled Congress for the last 2 years?
Republicans are not free from fault. Even the most ardent supporter of free markets has to wince and admit it does need adult supervision.
The independents who will decide this election disapprove of Bush’s performance, but they harbor even greater disapproval of Congress and the Media.
It does appear that the public is not a pawn of any media, and that they are not swayed by images. They seek clarity and understanding that is poorly served by campaign ads.
Obama’s staged event in Berlin and his extravagant stage props at Investco Field (maybe a bad time to use a facility named for an investment company) have not helped him in the polls; or if it did it was quickly undone by the Alaskan redneck lady with the lip gloss from a very, very plain stage.
The voters may be capable of understanding more than they are given credit for.
9/17/2008 4:16 AM
We are midway into a week of financial crisis, and the blogosphere writers seek the insights to explain it all. While this debacle has a long complicated history, the basics are really pretty simple.
The placement of these events 7 weeks before the most contentious presidential election in memory inevitably will have the candidates and their parties politicizing the bailouts. But campaign sound bites are not conducive to understanding such events.
But any attempts to blame the “other” party will backfire. There are plenty of Democratic fingerprints on this smoking gun. Why was Fannie Mae exempt from SEC oversight and subject only to Congressional oversight.... and who has controlled Congress for the last 2 years?
Republicans are not free from fault. Even the most ardent supporter of free markets has to wince and admit it does need adult supervision.
The independents who will decide this election disapprove of Bush’s performance, but they harbor even greater disapproval of Congress and the Media.
It does appear that the public is not a pawn of any media, and that they are not swayed by images. They seek clarity and understanding that is poorly served by campaign ads.
Obama’s staged event in Berlin and his extravagant stage props at Investco Field (maybe a bad time to use a facility named for an investment company) have not helped him in the polls; or if it did it was quickly undone by the Alaskan redneck lady with the lip gloss from a very, very plain stage.
The voters may be capable of understanding more than they are given credit for.
Tuesday, September 16, 2008
New Feminism
Sarah Palin has been referred to as a 'Republican Cyborg'- almost too perfect.
She is as real as a woman gets, yet she impresses with a sense of accomplishment and balance few people can imagine.
She is smart, powerful, friendly and feminine. She has a smile and a sense of humor. She could charm the hood off an Eskimo. Palin hunts, shoots, fishes, cooks, helps the kids with homework, and runs the largest state.
It is almost exhausting to even talk about her. What she is not is elitist, Ivy League educated, a lawyer, a community organizer, or self absorbed.
I have been concerned that her biggest liability is her strong pro life stand, but perhaps this is less of a liability than it used to be. Why?
Minorities have big families and sometimes resent abortion as a form of discrimination. Jesse Jackson has criticized the location of abortion clinics in black neighborhoods.
With contraception widely used and accepted, abortion is less of an issue. This may explain Palin's appeal to the 25 to 40 year old women. They would probably prefer a pro choice stand but it is less of a litmus test issue than it is to the older 'feminists'.
Catholic voters who were Democratic loyalists, especially amoung the northeast union members could tilt some significant electoral votes toward Palin. Her life style probably resonates with them. Some of them are uncomfortable with Obama, possibly for racial reasons, but more because of his elitism and his otherness. They have someone to run from and someone to run to.
Perhaps this is the result of a demographic shift of three decades of pro life women having more children than the pro choice women. Perhaps NOW's policies have eliminated their support base.
Has abortion become less of an election issue?
She is as real as a woman gets, yet she impresses with a sense of accomplishment and balance few people can imagine.
She is smart, powerful, friendly and feminine. She has a smile and a sense of humor. She could charm the hood off an Eskimo. Palin hunts, shoots, fishes, cooks, helps the kids with homework, and runs the largest state.
It is almost exhausting to even talk about her. What she is not is elitist, Ivy League educated, a lawyer, a community organizer, or self absorbed.
I have been concerned that her biggest liability is her strong pro life stand, but perhaps this is less of a liability than it used to be. Why?
Minorities have big families and sometimes resent abortion as a form of discrimination. Jesse Jackson has criticized the location of abortion clinics in black neighborhoods.
With contraception widely used and accepted, abortion is less of an issue. This may explain Palin's appeal to the 25 to 40 year old women. They would probably prefer a pro choice stand but it is less of a litmus test issue than it is to the older 'feminists'.
Catholic voters who were Democratic loyalists, especially amoung the northeast union members could tilt some significant electoral votes toward Palin. Her life style probably resonates with them. Some of them are uncomfortable with Obama, possibly for racial reasons, but more because of his elitism and his otherness. They have someone to run from and someone to run to.
Perhaps this is the result of a demographic shift of three decades of pro life women having more children than the pro choice women. Perhaps NOW's policies have eliminated their support base.
Has abortion become less of an election issue?
The Limits of Experts
"It seems that knowing a lot is simply not as helpful in making predictions about human behaviour as people tend to assume. Too much knowledge can actually trip you up, because it gets enlisted on behalf of your favorite hunches- or fears- instead of being evaluated objectively. Having mere facts at their disposal, experts are able to support their theories more ingeniously; they are more reluctant to change their minds, even when proven wrong. And finally, experts- no different than laymen-tend to grab onto facts that support their views and pass on those that don't."
from Mobs, Messiahs and Markets by William Bonner and Lila Rajiva
from Mobs, Messiahs and Markets by William Bonner and Lila Rajiva
Monday, September 15, 2008
Another Damn HKO Prediction
Lehman is bankrupt.
Merril Lynch is acquired.
The Dow is down 500 points.
I predict it will end the week higher than it started.
Merril Lynch is acquired.
The Dow is down 500 points.
I predict it will end the week higher than it started.
Money, Chewing Gum, and Elections
I like books that challenge conventional thinking beyond shallow left and right analogies. In this vein I recommend Nassim Taleb’s “Fooled by Randomness” and “The Black Swan”, Freakonomics by Steven D. Levitt and Stephen J. Dubner, and “The Tipping Point” by Malcolm Gladwell and even”Think” by Michale LeGault (which challenged Gladwell’s ‘Blink’).
I now add “Mobs, Messiahs and Markets” by William Bonner and Lila Rajiva to that special list of books that are thought provoking and enlightening. Kudos to the tip from Douglass Ott. (Yes and not Yes).
For example the authors challenge the conventional wisdom that we spend too much on elections and that money is too influential.
“It seem that Americans spend about a billion dollars on elections, all told, which is also what they spend annually on ..... chewing gum.”
“Levitt found that winners could have halved their spending and lost only 1% of the vote, while losers could have doubled their spending and gained only 1%. Who you are seems to have been more important than what you spend.”
“The belief – like many beliefs we hold as a group- is simply not as well founded as people think it is.”
I now add “Mobs, Messiahs and Markets” by William Bonner and Lila Rajiva to that special list of books that are thought provoking and enlightening. Kudos to the tip from Douglass Ott. (Yes and not Yes).
For example the authors challenge the conventional wisdom that we spend too much on elections and that money is too influential.
“It seem that Americans spend about a billion dollars on elections, all told, which is also what they spend annually on ..... chewing gum.”
“Levitt found that winners could have halved their spending and lost only 1% of the vote, while losers could have doubled their spending and gained only 1%. Who you are seems to have been more important than what you spend.”
“The belief – like many beliefs we hold as a group- is simply not as well founded as people think it is.”
Sunday, September 14, 2008
Democrats on the Defensive
"[Sarah] Palin's speech to the GOP National Convention on Wednesday has set it up so that the Republicans are now on offense and Democrats are on defense. And we don't do well on defense. Suddenly, Palin and John McCain are the mavericks and Barack Obama and Joe Biden are the status quo, in a year when you don't want to be seen as defending the status quo. From taxes to oil drilling, Democrats are now going to have to start explaining their positions" -- Willie Brown, former Mayor of San Francisco and former Speaker of California's State Assembly, writing in the San Francisco Chronicle.
from WSJ.com Political Diary
from WSJ.com Political Diary
The Emotional Factor in Risk
“for example, we consider having a gun in the house far more dangerous to children than say, a swimming pool, but in fact children die at the rate of 1 per 11,000 swimming pools, but only at the rate of 1 for more than a million guns. There is even a formula to express the emotional component of risk assessment:
Risk Equals Hazard Plus Outrage (or dread)
What it means is that people try to exaggerate high outrage risks like mad cow disease and terrorism, while tending to ignore low –outrage risks like kitchen infections, although these may in fact be far less dangerous”
From “Mobs, Messiahs and Markets” by William Bonner and Lila Rajiva
HKO comments – this also explains why we get little improvement in our lives from government meddling. The political payoff is far greater for taking action against dread and outrage than real risks. This is why there is no NRA for pool owners needed to protect their rights to risk their children’s lives in order to exercise (no pun intended) their right to swim.
Risk profiles change rapidly over time. How important was terrorsim in assessing risk on September 10, 2001 relative to a week later? How has the investment risk assesment of investing in Viet Nam or China changed in the last ten years?
This is why raising taxes and business costs is so risky. It changes the risk profile in ways that arrogant policy planners could never anticipate.
Risk Equals Hazard Plus Outrage (or dread)
What it means is that people try to exaggerate high outrage risks like mad cow disease and terrorism, while tending to ignore low –outrage risks like kitchen infections, although these may in fact be far less dangerous”
From “Mobs, Messiahs and Markets” by William Bonner and Lila Rajiva
HKO comments – this also explains why we get little improvement in our lives from government meddling. The political payoff is far greater for taking action against dread and outrage than real risks. This is why there is no NRA for pool owners needed to protect their rights to risk their children’s lives in order to exercise (no pun intended) their right to swim.
Risk profiles change rapidly over time. How important was terrorsim in assessing risk on September 10, 2001 relative to a week later? How has the investment risk assesment of investing in Viet Nam or China changed in the last ten years?
This is why raising taxes and business costs is so risky. It changes the risk profile in ways that arrogant policy planners could never anticipate.
Saturday, September 13, 2008
Who Are the Rich?
from The Wall Street Journal Online
If You Like Michigan's Economy, You'll Love Obama's
By PHIL GRAMM and MIKE SOLON
September 13, 2008; Page A13
excerpt
Mr. McCain will lower taxes. Mr. Obama will raise them, especially on small businesses. To understand why, you need to know something about the "infamous" top 1% of income tax filers: In order to avoid high corporate tax rates and the double taxation of dividends, small business owners have increasingly filed as individuals rather than corporations. When Democrats talk about soaking the rich, it isn't the Rockefellers they're talking about; it's the companies where most Americans work. Three out of four individual income tax filers in the top 1% are, in fact, small businesses.
In the name of taxing the rich, Mr. Obama would raise the marginal tax rates to over 50% on millions of small businesses that provide 75% of all new jobs in America. Investors and corporations will also pay higher taxes under the Obama program, but, as the Michigan-Ohio-Illinois experience painfully demonstrates, workers ultimately pay for higher taxes in lower wages and fewer jobs.
If You Like Michigan's Economy, You'll Love Obama's
By PHIL GRAMM and MIKE SOLON
September 13, 2008; Page A13
excerpt
Mr. McCain will lower taxes. Mr. Obama will raise them, especially on small businesses. To understand why, you need to know something about the "infamous" top 1% of income tax filers: In order to avoid high corporate tax rates and the double taxation of dividends, small business owners have increasingly filed as individuals rather than corporations. When Democrats talk about soaking the rich, it isn't the Rockefellers they're talking about; it's the companies where most Americans work. Three out of four individual income tax filers in the top 1% are, in fact, small businesses.
In the name of taxing the rich, Mr. Obama would raise the marginal tax rates to over 50% on millions of small businesses that provide 75% of all new jobs in America. Investors and corporations will also pay higher taxes under the Obama program, but, as the Michigan-Ohio-Illinois experience painfully demonstrates, workers ultimately pay for higher taxes in lower wages and fewer jobs.
Will Palin Attract Independents?
As we learn more about Ms. Palin it becomes interesting to figure out how she will affect this campaign.
I start with the simplistic notion that a third of the voters will vote Democrat no matter what, a third will vote Republican and a third are the independents who really impact this election and most elections.
The Republican brand is pretty tarnished right now and there be more loyal Democrats than Republicans, and the middle third may be a bit more in play than normal.
She clearly had a significant impact in coalescing the Republican faithful who had felt distant from the McCain nomination. But the real question is what kind of influence she will have on the independent middle third.
While certainly a strong, independent, and accomplished woman, she is probably too conservative for the core Democrats. She is a strong Pro Lifer and her relationship with an evangelical church will not woo very many Hillary supporters, certainly not the women.
Palin's stand on abortion is absolute heresy to the feminine left and they will scortch her like a traitor. Her other accomplishments will count for nothing to them.
But will her pro life stand alienate the independents? My guess is that it will, but will it out weigh the reluctance they have with Obama? Reverend Wright and Obama’s associates are still a liability. He is still rated the most liberal senator in Congress, and in most elections that would hurt his chances. This one may be different.
The pro Choice crowd has raised the fear of a return to back alley abortions for every Republican candidate since Nixon, but the courts including many judges appointed by Republicans, have continued to enforce the precedence of Roe Vs Wade. If McCain and Palin occupy the White House they will face a strongly Democratic House and Senate that will scrutinize any Supreme Court appointment on this major divisive issue. The chance of any change in the status of Roe VS Wade is small.
If Palin hedges her personal choice of anti abortion with a statement to recognize the legitimacy of Roe Vs Wade, she will alienate the strong Christian right support she has just ignited. If she stands firmly apposed to abortion rights, even in the case of rape, she risks alienating the independents that McCain so desperately needs.
It is about to get very interesting.
I start with the simplistic notion that a third of the voters will vote Democrat no matter what, a third will vote Republican and a third are the independents who really impact this election and most elections.
The Republican brand is pretty tarnished right now and there be more loyal Democrats than Republicans, and the middle third may be a bit more in play than normal.
She clearly had a significant impact in coalescing the Republican faithful who had felt distant from the McCain nomination. But the real question is what kind of influence she will have on the independent middle third.
While certainly a strong, independent, and accomplished woman, she is probably too conservative for the core Democrats. She is a strong Pro Lifer and her relationship with an evangelical church will not woo very many Hillary supporters, certainly not the women.
Palin's stand on abortion is absolute heresy to the feminine left and they will scortch her like a traitor. Her other accomplishments will count for nothing to them.
But will her pro life stand alienate the independents? My guess is that it will, but will it out weigh the reluctance they have with Obama? Reverend Wright and Obama’s associates are still a liability. He is still rated the most liberal senator in Congress, and in most elections that would hurt his chances. This one may be different.
The pro Choice crowd has raised the fear of a return to back alley abortions for every Republican candidate since Nixon, but the courts including many judges appointed by Republicans, have continued to enforce the precedence of Roe Vs Wade. If McCain and Palin occupy the White House they will face a strongly Democratic House and Senate that will scrutinize any Supreme Court appointment on this major divisive issue. The chance of any change in the status of Roe VS Wade is small.
If Palin hedges her personal choice of anti abortion with a statement to recognize the legitimacy of Roe Vs Wade, she will alienate the strong Christian right support she has just ignited. If she stands firmly apposed to abortion rights, even in the case of rape, she risks alienating the independents that McCain so desperately needs.
It is about to get very interesting.
Rhetoric and Reality
from National Review Online
September 12, 2008 8:30 AM
How Team Obama Pays Women
Pay equity for thee, but not for me.
By Deroy Murdock
excerpts
‘Now is the time to keep the promise of equal pay for an equal day’s work,” Democratic presidential nominee Barack Obama said August 28 in his convention acceptance speech. He told the crowd in Denver: “I want my daughters to have exactly the same opportunities as your sons.”
Obama’s campaign website is even more specific. Under the heading “Fighting for Pay Equity,” the women’s issues page laments that, “Despite decades of progress, women still make only 77 cents for every dollar a man makes. A recent study estimates it will take another 47 years for women to close the wage gap with men at Fortune 500 corporate offices. Barack Obama believes the government needs to take steps to better enforce the Equal Pay Act…”
Based on these calculations, Obama’s 28 male staffers divided among themselves total payroll expenditures of $1,523,120. Thus, Obama’s average male employee earned $54,397.
Obama’s 30 female employees split $1,354,580 among themselves, or $45,152, on average.
Why this disparity? One reason may be the underrepresentation of women among Obama’s highest-compensated employees. Of Obama’s five best-paid advisors, only one was a woman. Among his top 20, seven were women.
McCain’s 17 male staffers split $916,914, thus averaging $53,936. His 25 female employees divided $1,396,958 and averaged $55,878. On average, according to these data, women in John McCain’s office make $1.04 for every dollar a man makes. In fact, ceteris paribus, a typical female staffer could earn 21 cents more per dollar paid to her male counterpart — while adding $10,726 to her annual income — by leaving Barack Obama’s office and going to work for John McCain.
One explanation could be that women compose a majority of McCain’s highest-paid aides. Among his top-five best-compensated staffers, three are women. Of his 20-highest-salaried employees, 13 are women. The Republican presidential nominee relies on women — much more than men — for advice at the highest, and thus, best-paid levels.
Of all people, the Democratic standard bearer should understand that equal pay begins at home.
September 12, 2008 8:30 AM
How Team Obama Pays Women
Pay equity for thee, but not for me.
By Deroy Murdock
excerpts
‘Now is the time to keep the promise of equal pay for an equal day’s work,” Democratic presidential nominee Barack Obama said August 28 in his convention acceptance speech. He told the crowd in Denver: “I want my daughters to have exactly the same opportunities as your sons.”
Obama’s campaign website is even more specific. Under the heading “Fighting for Pay Equity,” the women’s issues page laments that, “Despite decades of progress, women still make only 77 cents for every dollar a man makes. A recent study estimates it will take another 47 years for women to close the wage gap with men at Fortune 500 corporate offices. Barack Obama believes the government needs to take steps to better enforce the Equal Pay Act…”
Based on these calculations, Obama’s 28 male staffers divided among themselves total payroll expenditures of $1,523,120. Thus, Obama’s average male employee earned $54,397.
Obama’s 30 female employees split $1,354,580 among themselves, or $45,152, on average.
Why this disparity? One reason may be the underrepresentation of women among Obama’s highest-compensated employees. Of Obama’s five best-paid advisors, only one was a woman. Among his top 20, seven were women.
McCain’s 17 male staffers split $916,914, thus averaging $53,936. His 25 female employees divided $1,396,958 and averaged $55,878. On average, according to these data, women in John McCain’s office make $1.04 for every dollar a man makes. In fact, ceteris paribus, a typical female staffer could earn 21 cents more per dollar paid to her male counterpart — while adding $10,726 to her annual income — by leaving Barack Obama’s office and going to work for John McCain.
One explanation could be that women compose a majority of McCain’s highest-paid aides. Among his top-five best-compensated staffers, three are women. Of his 20-highest-salaried employees, 13 are women. The Republican presidential nominee relies on women — much more than men — for advice at the highest, and thus, best-paid levels.
Of all people, the Democratic standard bearer should understand that equal pay begins at home.
Suicide Ads
Never try to kill someone who is busy committing suicide.
First Obama alienates even more women with the "lipstick on a pig" remark.
Then he alienates the seniors with the ads berating McCain's IT skills. Does anyone in his campaign realize how many seniors do not use computers, and how high a rate they vote?
Such ads will be laughingly embraced by the committed supporters, offensively rejected by his opponents, and likely counterproductive with the independents who will decide this election.
The worst in political advertising is when the writers waddle in the creative and the cool, seeking gold 'gotchas' while making more groups 'uncomfortable' voting for their candidate.
The most effective ads are not the most creative, but the ones who make the uncommitted a little more uncomfortable voting for the opposition. The McCain ad with Paris Hilton and Britany Spears, making fun of Obama's celebrity status, seemed intellectually vacuous, yet it was effective in turning Obama's celebrity against him.
It made the uncommitted a little more uncomfortable with him, while offending no large blocks other than his committed supporters.
One wonders if a Republican plant is not writing Obama's ads.
First Obama alienates even more women with the "lipstick on a pig" remark.
Then he alienates the seniors with the ads berating McCain's IT skills. Does anyone in his campaign realize how many seniors do not use computers, and how high a rate they vote?
Such ads will be laughingly embraced by the committed supporters, offensively rejected by his opponents, and likely counterproductive with the independents who will decide this election.
The worst in political advertising is when the writers waddle in the creative and the cool, seeking gold 'gotchas' while making more groups 'uncomfortable' voting for their candidate.
The most effective ads are not the most creative, but the ones who make the uncommitted a little more uncomfortable voting for the opposition. The McCain ad with Paris Hilton and Britany Spears, making fun of Obama's celebrity status, seemed intellectually vacuous, yet it was effective in turning Obama's celebrity against him.
It made the uncommitted a little more uncomfortable with him, while offending no large blocks other than his committed supporters.
One wonders if a Republican plant is not writing Obama's ads.
Friday, September 12, 2008
Vote Early
With the left energized by Obama's campaign and now Palin energizing the Republicans, you can expect this election to have a record turnout.
Conisder voting early. You can do this at your local board of election office.
Neither side wants voters to get disouraged by long lines.
Conisder voting early. You can do this at your local board of election office.
Neither side wants voters to get disouraged by long lines.
Underestimating Their Enemy
From American Thinker
September 11, 2008
Palin and the Left's Comprehension Gap
By Dave Smithee
Excerpts
For reasons above my pay grade since it seems to be doing them no favors, the democrats and media cling to and propagate theses curiously garish caricatures about conservatives that would be more at home in the works of Bosch than in any recognizable reality. And not just in private; but as par for the course in the national discussion. For example, Sarah Palin doesn't merely have 'flawed policies'. In the space of two weeks, we've discovered she's apparently a power-drunk loon, an anti-Semite, a hypocrite, an unfit mother, a religious fanatic, a redneck escapee from the set of Deliverance, a Nazi sympathizer, and an 18th-century secessionist. All she's missing is a mustache to twirl.
The reality that forever eludes our left-wing intelligentsia is simple. The bulk of conservatives are not sleeping on dirt floors. We are simply those who have thought beyond step one, and realized that the state is not, and cannot be, the answer. We realize that all of history up to our current disastrous experiments with statism, economic 'management', and the disastrous social welfare theories of whites that have been perpetrated on minorities, have proven that conservatism offers the optimal arrangement of social conditions under which individuals, families, communities, and nations thrive. Are there sexists and bigots among the conservative community? As surely as there are those on the left who believe mankind deserves wholesale slaughter for angering Gaia (Greek goddess of Earth), or lunatic professors willing to call slaughtered American civilians 'Little Eichmans'.
Unlikely, and the ignorance seems all the more entrenched for being entirely self-imposed. Their campaign against Palin will likely consist of the same failed attack strategies that have systematically lowered news coverage on her to the journalistic tenor of Sasquatch sightings. As Sun Tzu might guess, they have every reason to fear the outcome of this particular battle.
September 11, 2008
Palin and the Left's Comprehension Gap
By Dave Smithee
Excerpts
For reasons above my pay grade since it seems to be doing them no favors, the democrats and media cling to and propagate theses curiously garish caricatures about conservatives that would be more at home in the works of Bosch than in any recognizable reality. And not just in private; but as par for the course in the national discussion. For example, Sarah Palin doesn't merely have 'flawed policies'. In the space of two weeks, we've discovered she's apparently a power-drunk loon, an anti-Semite, a hypocrite, an unfit mother, a religious fanatic, a redneck escapee from the set of Deliverance, a Nazi sympathizer, and an 18th-century secessionist. All she's missing is a mustache to twirl.
The reality that forever eludes our left-wing intelligentsia is simple. The bulk of conservatives are not sleeping on dirt floors. We are simply those who have thought beyond step one, and realized that the state is not, and cannot be, the answer. We realize that all of history up to our current disastrous experiments with statism, economic 'management', and the disastrous social welfare theories of whites that have been perpetrated on minorities, have proven that conservatism offers the optimal arrangement of social conditions under which individuals, families, communities, and nations thrive. Are there sexists and bigots among the conservative community? As surely as there are those on the left who believe mankind deserves wholesale slaughter for angering Gaia (Greek goddess of Earth), or lunatic professors willing to call slaughtered American civilians 'Little Eichmans'.
Unlikely, and the ignorance seems all the more entrenched for being entirely self-imposed. Their campaign against Palin will likely consist of the same failed attack strategies that have systematically lowered news coverage on her to the journalistic tenor of Sasquatch sightings. As Sun Tzu might guess, they have every reason to fear the outcome of this particular battle.
Thursday, September 11, 2008
Withdrawal Odds
For the last few weeks Intrade has been trading a position that Sarah Palin would be withdraw as the VP candidate for Obama. They listed very low odds of about 6%.
The "Palin To Withdraw" position is no longer posted but there is a "Biden to Withdraw" position now listed with the same odds.
The "Palin To Withdraw" position is no longer posted but there is a "Biden to Withdraw" position now listed with the same odds.
The Obama Edge
People most often vote their pocket books and the current risk posture of our economy with rising unemployment and declining earning gives an edge to Obama. Even if the economy is not as bad an much of the press states, if the people see a softening economy they will want a change.
It was Clinton's focus on the economy that beat George H. Bush after his 90% approval rating immediately after the first Gulf War. Bush II cerainly has never enjoyed such a high approval rating.
The announcement of troops withdrawals from Iraq also gives Obama an edge. His weakness and inexperience on foreign affairs is much less of a liability if the people do not fear terrorism and war. As I have stated before our success in the war on terror gives an edge to Obama because it allows him to focus on the economy.
At this point in the campaign as many voters suffer the fatigue of incessant sniping from hyprocritical and cynical talking heads, the last laps will be decided by how much the candidates can engage the uncommitted emotionally.
Sarah Palin's contribution to the McCain ticket may be the way she connected with such strong emotions to the mothers, the women, the small towns, and other listeners. Obama is a good speaker but he does not connect as emotionally as Palin.
Whether she is good enough to help McCain overcome the edge the current state of affairs gives Obama remains to be seen. If McCain does not close the gap shortly after the convention, it will be hard to accomplish later.
It was Clinton's focus on the economy that beat George H. Bush after his 90% approval rating immediately after the first Gulf War. Bush II cerainly has never enjoyed such a high approval rating.
The announcement of troops withdrawals from Iraq also gives Obama an edge. His weakness and inexperience on foreign affairs is much less of a liability if the people do not fear terrorism and war. As I have stated before our success in the war on terror gives an edge to Obama because it allows him to focus on the economy.
At this point in the campaign as many voters suffer the fatigue of incessant sniping from hyprocritical and cynical talking heads, the last laps will be decided by how much the candidates can engage the uncommitted emotionally.
Sarah Palin's contribution to the McCain ticket may be the way she connected with such strong emotions to the mothers, the women, the small towns, and other listeners. Obama is a good speaker but he does not connect as emotionally as Palin.
Whether she is good enough to help McCain overcome the edge the current state of affairs gives Obama remains to be seen. If McCain does not close the gap shortly after the convention, it will be hard to accomplish later.
Seven Years
Seven years today without another terrorist attack.
Yet the president who delivered this result is vilified as one of our worst presidents.
Fickle, aren't we?
Yet the president who delivered this result is vilified as one of our worst presidents.
Fickle, aren't we?
Hanson on 9/11
from Victor Davis Hanson in
The National Review
The Other 9/11 Story
What has and hasn't happened in the seven years since September 11, 2001.
excerpts:
It would be cruel to relate by name all those prominent Americans — including politicians, think-tankers, pundits, and military analysts — who felt once, and vehemently so, that the rogue and genocidal regime of Saddam Hussein — in violation of UN accords and 1991 armistice agreements, and the object of 12 years of no-fly zones — was an impediment to the need to change the conditions that had fostered 9/11. Yet suffice it to say that, when Iraq went from a brilliant three-week victory to someone else’s flawed and bloody five-year occupation, almost no prior supporter of the need to remove Saddam could be found. It was not just that most changed their minds as the pulse of the battlefield changed; but rather that many prior supporters insidiously convinced themselves that in the now distant past they had never advocated such a supposedly preposterous war in the first place.
Seven years later, hundreds of billions of dollars have been expended; over 4,000 Americans have been lost in Iraq and Afghanistan; and America’s preexisting cultural wounds have had their thin scabs torn off by acrimony over warring abroad and security at home. And yet herein lies the greatest paradox of all that followed from September 11. If no one on September 12, 2001 thought it possible that the United States would not be hit again by a terrorist attack of similar magnitude, here we are still free from a major terrorist assault over 2,500 days later.
Bin Laden and Dr. Zawahiri are still hiding out in the caves of tribal Pakistan, in fear of daylight sorties by deadly American drones, but counting on safety from coalition ground attack through the auspices of their wink-and-nod — and nuclear — Islamic Pakistani hosts. The top cadres of al-Qaeda, nonetheless, are now either mostly dead, captured, or in hiding. When al-Qaeda now whines in its infomercials, the complaint is about Shiite Iran who supposedly helped the infidel Americans, not the Americans themselves who alone sent them to the caves of Pakistan and defeated them in, and routed them from, Iraq.
In response, polls reveal that Middle Eastern support for bin Laden, al-Qaeda, and the tactic of suicide bombing are at an all-time low. Constitutional governments remain in power in both Afghanistan and Iraq. Al-Qaeda has suffered a terrible material and public-relations defeat in the heart of the ancient caliphate.
The truth is, we chased al-Qaeda from Iraq and Afghanistan and it is now in lunatic fashion chasing Danish cartoonists, European novelists, and opera producers as it cuts the fingers off smokers, tries to cover up the genitalia of animals, and looks for the mentally ill to strap on suicide belts.
But in years to come it may well be said that the president kept us safe for years when none thought he could, and removed the two most odious regimes in the Middle East and replaced them with the two best — and confronted a confident and ascendant radical Islam and left it demoralized and discredited among its own host Arab and Muslim constituents.
In the present toxic environment, all of that is not to be spoken — but all that has nevertheless happened since September 11.
The National Review
The Other 9/11 Story
What has and hasn't happened in the seven years since September 11, 2001.
excerpts:
It would be cruel to relate by name all those prominent Americans — including politicians, think-tankers, pundits, and military analysts — who felt once, and vehemently so, that the rogue and genocidal regime of Saddam Hussein — in violation of UN accords and 1991 armistice agreements, and the object of 12 years of no-fly zones — was an impediment to the need to change the conditions that had fostered 9/11. Yet suffice it to say that, when Iraq went from a brilliant three-week victory to someone else’s flawed and bloody five-year occupation, almost no prior supporter of the need to remove Saddam could be found. It was not just that most changed their minds as the pulse of the battlefield changed; but rather that many prior supporters insidiously convinced themselves that in the now distant past they had never advocated such a supposedly preposterous war in the first place.
Seven years later, hundreds of billions of dollars have been expended; over 4,000 Americans have been lost in Iraq and Afghanistan; and America’s preexisting cultural wounds have had their thin scabs torn off by acrimony over warring abroad and security at home. And yet herein lies the greatest paradox of all that followed from September 11. If no one on September 12, 2001 thought it possible that the United States would not be hit again by a terrorist attack of similar magnitude, here we are still free from a major terrorist assault over 2,500 days later.
Bin Laden and Dr. Zawahiri are still hiding out in the caves of tribal Pakistan, in fear of daylight sorties by deadly American drones, but counting on safety from coalition ground attack through the auspices of their wink-and-nod — and nuclear — Islamic Pakistani hosts. The top cadres of al-Qaeda, nonetheless, are now either mostly dead, captured, or in hiding. When al-Qaeda now whines in its infomercials, the complaint is about Shiite Iran who supposedly helped the infidel Americans, not the Americans themselves who alone sent them to the caves of Pakistan and defeated them in, and routed them from, Iraq.
In response, polls reveal that Middle Eastern support for bin Laden, al-Qaeda, and the tactic of suicide bombing are at an all-time low. Constitutional governments remain in power in both Afghanistan and Iraq. Al-Qaeda has suffered a terrible material and public-relations defeat in the heart of the ancient caliphate.
The truth is, we chased al-Qaeda from Iraq and Afghanistan and it is now in lunatic fashion chasing Danish cartoonists, European novelists, and opera producers as it cuts the fingers off smokers, tries to cover up the genitalia of animals, and looks for the mentally ill to strap on suicide belts.
But in years to come it may well be said that the president kept us safe for years when none thought he could, and removed the two most odious regimes in the Middle East and replaced them with the two best — and confronted a confident and ascendant radical Islam and left it demoralized and discredited among its own host Arab and Muslim constituents.
In the present toxic environment, all of that is not to be spoken — but all that has nevertheless happened since September 11.
Wednesday, September 10, 2008
Intrade Catches Up
On 9/4/08 Intrade odds favored Obama significantly with 59.5% odds for Obama and 41.5% odds for McCain.
Today as of 7:51 PM they are about dead even with Obama at 49.4% and McCain at 49.3%.
The spread has narrowed from 18 to nearly zero in less than a week. Intrade has lagged the polls on this, with nearly every poll having McCain ahead , a distinct reversal from a few weeks ago.
Will it hold?
PS 9:40 PM McCain is ahead with 50% odds compared to Obama's 48.8% for the first time in this campaign.
Today as of 7:51 PM they are about dead even with Obama at 49.4% and McCain at 49.3%.
The spread has narrowed from 18 to nearly zero in less than a week. Intrade has lagged the polls on this, with nearly every poll having McCain ahead , a distinct reversal from a few weeks ago.
Will it hold?
PS 9:40 PM McCain is ahead with 50% odds compared to Obama's 48.8% for the first time in this campaign.
The Ultimate Cost of a Bailout
The bailout of Fannie Mae by the government is probably a necessary but bitter pill. All of this reminds me of the bailout of the S&L industry under George H. Bush.
Both of these problems were a long time in the making, and could be attributed to poor government fiscal and monetary policy, weak regulation, as well as greed and hubris in the financial industry. The financial industry like to believe they can make value appear out of thin air. Thirty year old mortgage bankers with private jets deluded themselves into thinking they had somehow earned them.
I believe these bailouts were inevitable, and wise in the long run. But they come at a severe cost. The taxpayers will be paying for these huge bailouts for years to come. These losses are here today because the regulators bowed to political pressure to allow ridiculous practices in the industry for way too many years.
While many blame greedy unfettered capitalism, Freddie and Fannie were government creations, government chartered, exempt from SEC regulation and subject to special Congressional oversight. The failure to supervise this entity lays directly in Congress's lap.
Freddie and Fannie had special priviledges endowed by Congress. They could borrow money cheaper than any private company, and they were tax exempt. It takes real hubris and neglect for them to screw up this advantage. Congressional favors were traded like cheap stocks.
Both of these problems were a long time in the making, and could be attributed to poor government fiscal and monetary policy, weak regulation, as well as greed and hubris in the financial industry. The financial industry like to believe they can make value appear out of thin air. Thirty year old mortgage bankers with private jets deluded themselves into thinking they had somehow earned them.
I believe these bailouts were inevitable, and wise in the long run. But they come at a severe cost. The taxpayers will be paying for these huge bailouts for years to come. These losses are here today because the regulators bowed to political pressure to allow ridiculous practices in the industry for way too many years.
While many blame greedy unfettered capitalism, Freddie and Fannie were government creations, government chartered, exempt from SEC regulation and subject to special Congressional oversight. The failure to supervise this entity lays directly in Congress's lap.
Freddie and Fannie had special priviledges endowed by Congress. They could borrow money cheaper than any private company, and they were tax exempt. It takes real hubris and neglect for them to screw up this advantage. Congressional favors were traded like cheap stocks.
Taxing Our Way to Prosperity
Why Taxes Matter:
You are analyzing a business opportunity that requires a $100,000 investment.
There is a 50% chance you will lose the investment, and there is a 50% chance you will double your investment. The potential return is :
-100,000 x 50% = -50,000
+200,000 x 50% = +100,000
The prorated risk return is $50,000 (the difference) or 50%.
Now let’s assume there is a tax on the gain of 20%
-100,000 x 50% = -50,000
+200,000 x 50% x 80% = +80,000
The prorated risk return is $30,000 (the difference) or 30%.
Now let’s assume some fool candidate wants to raise the taxes to 40%
-100,000 x 50% = -50,000
+200,000 x 50% x 60% = +60,000
The prorated risk return is $10,000 (the difference) or 10%.
Now you may think “Why should I risk $100,000 for a mere 10% when I can buy a secure bond, CD or even a mutual fund and get a similar return without the risk?”
The tax increase has just killed your incentive to invest. The additional tax on income has decreased the prorated risk profile, and reduced the rationality to take a risk. Job creation declines, tax revenues decline, unemployment increases.
This example is certainly overly simplified and there are lots of detailed differences between this and current reality; but it indicates how investors assess risk and how taxes affect the way they look at risk.
Bureaucrats believe they can fine tune the economy, and raise taxes without reducing the incentive to grow the economy. They are usually wrong for two important reasons:
The risk profile is constantly changing. Over seas opportunities, currency fluctuations, market booms and busts, interest rate changes, and industry dynamics constantly change the acceptable risk profiles. What was an acceptable risk profile last year may be totally unacceptable this year. No government policy or program is capable of understanding much less adjusting to such a change.
Secondly, risk profiles remain attached to human emotions. Terrorist attacks, stock market selloffs, and bank collapses strike fear into investors. A tax policy that may have had little impact on acceptable risk profiles for the last few years may suddenly have a severe adverse effect when the emotions of greed and fear are applied.
The recipe for growth remains:
Low taxes
Low regulation
Strong currency
Free trade
I believe Reagan said it best and true when he uttered,” You can not tax your way to prosperity.”
You are analyzing a business opportunity that requires a $100,000 investment.
There is a 50% chance you will lose the investment, and there is a 50% chance you will double your investment. The potential return is :
-100,000 x 50% = -50,000
+200,000 x 50% = +100,000
The prorated risk return is $50,000 (the difference) or 50%.
Now let’s assume there is a tax on the gain of 20%
-100,000 x 50% = -50,000
+200,000 x 50% x 80% = +80,000
The prorated risk return is $30,000 (the difference) or 30%.
Now let’s assume some fool candidate wants to raise the taxes to 40%
-100,000 x 50% = -50,000
+200,000 x 50% x 60% = +60,000
The prorated risk return is $10,000 (the difference) or 10%.
Now you may think “Why should I risk $100,000 for a mere 10% when I can buy a secure bond, CD or even a mutual fund and get a similar return without the risk?”
The tax increase has just killed your incentive to invest. The additional tax on income has decreased the prorated risk profile, and reduced the rationality to take a risk. Job creation declines, tax revenues decline, unemployment increases.
This example is certainly overly simplified and there are lots of detailed differences between this and current reality; but it indicates how investors assess risk and how taxes affect the way they look at risk.
Bureaucrats believe they can fine tune the economy, and raise taxes without reducing the incentive to grow the economy. They are usually wrong for two important reasons:
The risk profile is constantly changing. Over seas opportunities, currency fluctuations, market booms and busts, interest rate changes, and industry dynamics constantly change the acceptable risk profiles. What was an acceptable risk profile last year may be totally unacceptable this year. No government policy or program is capable of understanding much less adjusting to such a change.
Secondly, risk profiles remain attached to human emotions. Terrorist attacks, stock market selloffs, and bank collapses strike fear into investors. A tax policy that may have had little impact on acceptable risk profiles for the last few years may suddenly have a severe adverse effect when the emotions of greed and fear are applied.
The recipe for growth remains:
Low taxes
Low regulation
Strong currency
Free trade
I believe Reagan said it best and true when he uttered,” You can not tax your way to prosperity.”
The Smell of Blood
Perhaps the best explanation of why the Intrade betting spread does not completely confirm the McCain lead in the polls is because the betting people may be more focused on the electoral votes than the popular votes of the polls.
I may seem to be too focused on Intrade. Intrade will be much less accurate as a long term oracle than it would be as a short term prediction. The short term bets may come from some with insider knowledge.
Regardless, the spread has reduced sharply as McCain has risen in the polls. The timing of this reversal has been seen in previous campaigns.
One has to think that if McCain has jumped ahead after a period of a ridiculous fawning media worship of Obama and incredibly biased coverage, during a time when the Republican brand is as tarnished as it has been since Nixon, and after record fundraising from Obama supporters- then Obama should be worried, very worried.
Early in the campaign the Hillary nomination seemed inevitable. When she stumbled out of the gate after the Iowa primary the media started to pile on. Every gaffe was repeated (sniper fire in Bosnia) and every scowl was amplified. Obama's gaffes ( and there were many) were largely ignored.
The media descended on Hillary like a pack of starving wolves surrounding a wounded prey. Are they starting to smell blood in the Obama camp?
Expect to see more coverage of Obama's gaffes. Expect to see the media less likely to give him the benefit of a doubt.
I may seem to be too focused on Intrade. Intrade will be much less accurate as a long term oracle than it would be as a short term prediction. The short term bets may come from some with insider knowledge.
Regardless, the spread has reduced sharply as McCain has risen in the polls. The timing of this reversal has been seen in previous campaigns.
One has to think that if McCain has jumped ahead after a period of a ridiculous fawning media worship of Obama and incredibly biased coverage, during a time when the Republican brand is as tarnished as it has been since Nixon, and after record fundraising from Obama supporters- then Obama should be worried, very worried.
Early in the campaign the Hillary nomination seemed inevitable. When she stumbled out of the gate after the Iowa primary the media started to pile on. Every gaffe was repeated (sniper fire in Bosnia) and every scowl was amplified. Obama's gaffes ( and there were many) were largely ignored.
The media descended on Hillary like a pack of starving wolves surrounding a wounded prey. Are they starting to smell blood in the Obama camp?
Expect to see more coverage of Obama's gaffes. Expect to see the media less likely to give him the benefit of a doubt.
Tuesday, September 9, 2008
Oil is Elastic
From WSJ Political Diary 9/9/08
There are two explanations for the lower oil price. The dollar has been rising relative to other currencies and gold. The near 20% fall in gold from its $1,000 peak earlier this year has driven down the price of oil, just as the collapse of the dollar relative to gold from 2001-2007 explains about 90% of the rise in the oil price over that period.
The other reason oil prices are drifting downward is consumption of oil has fallen sharply. Energy Information Administration data show that demand in the first half of 2008 dropped by 800,000 barrels a day. This is the sharpest drop in 26 years. Demand for oil is proving to be more price elastic in the short and medium term than experts previously thought. We don't need costly government energy conservation programs when oil prices are high. Markets work in energy and if you don't believe that, go into a Hummer dealership if you can still find one.
There are two explanations for the lower oil price. The dollar has been rising relative to other currencies and gold. The near 20% fall in gold from its $1,000 peak earlier this year has driven down the price of oil, just as the collapse of the dollar relative to gold from 2001-2007 explains about 90% of the rise in the oil price over that period.
The other reason oil prices are drifting downward is consumption of oil has fallen sharply. Energy Information Administration data show that demand in the first half of 2008 dropped by 800,000 barrels a day. This is the sharpest drop in 26 years. Demand for oil is proving to be more price elastic in the short and medium term than experts previously thought. We don't need costly government energy conservation programs when oil prices are high. Markets work in energy and if you don't believe that, go into a Hummer dealership if you can still find one.
The Politics of Fannie Mae
From National Review Online
Politics and the Fannie Mae Piggie Bank
by Byron York
excerpts:
On May 23, 2006, as a jury in Houston deliberated the case against top Enron executives Kenneth Lay and Jeffrey Skilling, a little-known regulatory agency in Washington, the Office of Federal Housing Enterprise Oversight (OFHEO), released a study with the dryly bureaucratic title “Report of the Special Examination of Fannie Mae.” The document received far less attention than the news from Enron, but its conclusions were stunning. In meticulous detail, it outlined a culture of corruption at the Federal National Mortgage Association — better known as Fannie Mae — that rivals the most serious corporate scandals in recent years. In this case, however, the main players are Washington insiders — some of them prominent veterans of the Clinton administration — and the scandal’s effects could ripple through Congress for years.
Fannie Mae is the biggest single source of money for mortgages in the United States. From 1998 to 2004, the years covered by the OFHEO investigation, it was headed by former Clinton budget director Franklin Raines, whose top management team included former Clinton Justice Department official Jamie Gorelick, sometimes mentioned as a future attorney general in a Democratic administration. During that period, the report says, Raines and his team grossly overstated Fannie Mae’s earnings — to the tune of $10.6 billion — for the purpose of paying themselves big bonuses. “By deliberately and intentionally manipulating accounting to hit earnings targets,” the report says, “senior management maximized the bonuses and other executive compensation they received, at the expense of shareholders.”
But the OFHEO report suggests that none of that mattered to Raines, who had been a top official at Fannie Mae in the early 1990s before leaving to join the Clinton administration and then returning to Fannie Mae as chief executive in 1998. According to the report, Raines became obsessed with propping up Fannie Mae’s earnings per share, or EPS, even if he had to use creative accounting to make it happen. Raines set a series of increasingly higher EPS goals that, if met, would trigger bonuses for the executive team that far surpassed what they received in salary.
Even though his salary never topped $1 million, Raines’s total compensation shot from $6.48 million in 1998 to $8.52 million in 1999, to $13.89 million in 2000, to $18.86 million in 2001, to $18.20 million in 2002, to $24.15 million in 2003, all on the strength of EPS bonuses. Investigators found that of the $90.12 million Raines was paid in that six-year period, more than $52 million came from EPS bonuses.
Gorelick’s situation was similar. OFHEO found that she took home $26.46 million in the period from 1998 to 2002 (she left in that year, so she wasn’t there for the entire period under investigation). Of that figure, nearly $15 million came from EPS bonuses.
Of course, it wasn’t legit. “Fannie Mae reported extremely smooth profit growth and hit announced targets for earnings per share precisely each quarter,” the OFHEO report says. “Those achievements were illusions deliberately and systematically created by [Fannie Mae’s] senior management with the aid of inappropriate accounting and improper earnings management.”
In other words, they cooked the books. And to make matters worse, according to OFHEO, when regulators began to catch on to what was happening, Raines and his team then “sought to interfere” with the OFHEO investigation by trying to get Congress to start up a separate probe of OFHEO. Fannie Mae also lobbied Congress to cut OFHEO’s funds unless it got rid of the top official in charge of investigating Fannie Mae.
That didn’t work, and, as a result of the investigation, Fannie Mae has agreed to pay $400 million in penalties. The company is now under criminal investigation by the Justice Department, and will likely be in trouble with the Securities and Exchange Commission, too. And there probably won’t be much more talk about Gorelick as attorney general should a Democrat win the White House in 2008.
But there still is the matter of cleaning up Fannie Mae. Senator Sununu and his colleagues on the Senate banking committee have been trying for two years to win approval of a bill that would create a new regulatory body for Fannie Mae and give that body the authority to crack down on the company’s riskier practices.
But the bill has faced a lot of opposition, mostly from Democrats. When Raines was still at Fannie Mae (he was forced out in 2004), he tried, in Sununu’s words, “to slow-walk the process. Frank Raines decided they were stronger and better and smarter than everyone else, so they would push back.” Democrats allied themselves with Raines and said they worried that reform might harm Fannie Mae’s ability to provide mortgages to low- and middle-income homebuyers. Sununu’s bill was approved in the banking committee last year, but only on a straight party-line vote.
Politics and the Fannie Mae Piggie Bank
by Byron York
excerpts:
On May 23, 2006, as a jury in Houston deliberated the case against top Enron executives Kenneth Lay and Jeffrey Skilling, a little-known regulatory agency in Washington, the Office of Federal Housing Enterprise Oversight (OFHEO), released a study with the dryly bureaucratic title “Report of the Special Examination of Fannie Mae.” The document received far less attention than the news from Enron, but its conclusions were stunning. In meticulous detail, it outlined a culture of corruption at the Federal National Mortgage Association — better known as Fannie Mae — that rivals the most serious corporate scandals in recent years. In this case, however, the main players are Washington insiders — some of them prominent veterans of the Clinton administration — and the scandal’s effects could ripple through Congress for years.
Fannie Mae is the biggest single source of money for mortgages in the United States. From 1998 to 2004, the years covered by the OFHEO investigation, it was headed by former Clinton budget director Franklin Raines, whose top management team included former Clinton Justice Department official Jamie Gorelick, sometimes mentioned as a future attorney general in a Democratic administration. During that period, the report says, Raines and his team grossly overstated Fannie Mae’s earnings — to the tune of $10.6 billion — for the purpose of paying themselves big bonuses. “By deliberately and intentionally manipulating accounting to hit earnings targets,” the report says, “senior management maximized the bonuses and other executive compensation they received, at the expense of shareholders.”
But the OFHEO report suggests that none of that mattered to Raines, who had been a top official at Fannie Mae in the early 1990s before leaving to join the Clinton administration and then returning to Fannie Mae as chief executive in 1998. According to the report, Raines became obsessed with propping up Fannie Mae’s earnings per share, or EPS, even if he had to use creative accounting to make it happen. Raines set a series of increasingly higher EPS goals that, if met, would trigger bonuses for the executive team that far surpassed what they received in salary.
Even though his salary never topped $1 million, Raines’s total compensation shot from $6.48 million in 1998 to $8.52 million in 1999, to $13.89 million in 2000, to $18.86 million in 2001, to $18.20 million in 2002, to $24.15 million in 2003, all on the strength of EPS bonuses. Investigators found that of the $90.12 million Raines was paid in that six-year period, more than $52 million came from EPS bonuses.
Gorelick’s situation was similar. OFHEO found that she took home $26.46 million in the period from 1998 to 2002 (she left in that year, so she wasn’t there for the entire period under investigation). Of that figure, nearly $15 million came from EPS bonuses.
Of course, it wasn’t legit. “Fannie Mae reported extremely smooth profit growth and hit announced targets for earnings per share precisely each quarter,” the OFHEO report says. “Those achievements were illusions deliberately and systematically created by [Fannie Mae’s] senior management with the aid of inappropriate accounting and improper earnings management.”
In other words, they cooked the books. And to make matters worse, according to OFHEO, when regulators began to catch on to what was happening, Raines and his team then “sought to interfere” with the OFHEO investigation by trying to get Congress to start up a separate probe of OFHEO. Fannie Mae also lobbied Congress to cut OFHEO’s funds unless it got rid of the top official in charge of investigating Fannie Mae.
That didn’t work, and, as a result of the investigation, Fannie Mae has agreed to pay $400 million in penalties. The company is now under criminal investigation by the Justice Department, and will likely be in trouble with the Securities and Exchange Commission, too. And there probably won’t be much more talk about Gorelick as attorney general should a Democrat win the White House in 2008.
But there still is the matter of cleaning up Fannie Mae. Senator Sununu and his colleagues on the Senate banking committee have been trying for two years to win approval of a bill that would create a new regulatory body for Fannie Mae and give that body the authority to crack down on the company’s riskier practices.
But the bill has faced a lot of opposition, mostly from Democrats. When Raines was still at Fannie Mae (he was forced out in 2004), he tried, in Sununu’s words, “to slow-walk the process. Frank Raines decided they were stronger and better and smarter than everyone else, so they would push back.” Democrats allied themselves with Raines and said they worried that reform might harm Fannie Mae’s ability to provide mortgages to low- and middle-income homebuyers. Sununu’s bill was approved in the banking committee last year, but only on a straight party-line vote.
Another Word for Appeasement
from Israel Today
Monday, September 01, 2008
Israel Today Staff
Biden told Israel to accept nuclear Iran
US Senator and vice presidential hopeful Joe Biden reportedly told Israeli officials three years ago that sooner or later they would have to reconcile themselves to the reality of a nuclear-armed Iran.
Israel's Army Radio reported on the remarks, which Biden is said to have made to visiting Israeli officials in his capacity as chairman of the Senate Foreign Relations Committee.
According to the report, Biden reaffirmed to the Israelis his rejection of military action against Iran, but also admitted that diplomatic efforts to halt Iran's nuclear program had little or no chance of success. In essence, Biden resigned himself to the idea of a nuclear-armed Iran and told the Israelis that they, too, would have to accept that outcome.
Israeli security officials on Monday expressed concern over the remarks and saw them as further evidence that if Biden and his running mate, Senator Barack Obama, win the upcoming US presidential election, Iran's acquisition of nuclear weapons will be a foregone conclusion.
Israeli experts warn that it is only the real threat of force that stands a chance of convincing the mullahs and Iranian President Mahmoud Ahmadinejad to give up their nuclear ambitions.
HKO- tips to Bruce Tuchman. Diplomacy without a military option is another word for appeasement.
Monday, September 01, 2008
Israel Today Staff
Biden told Israel to accept nuclear Iran
US Senator and vice presidential hopeful Joe Biden reportedly told Israeli officials three years ago that sooner or later they would have to reconcile themselves to the reality of a nuclear-armed Iran.
Israel's Army Radio reported on the remarks, which Biden is said to have made to visiting Israeli officials in his capacity as chairman of the Senate Foreign Relations Committee.
According to the report, Biden reaffirmed to the Israelis his rejection of military action against Iran, but also admitted that diplomatic efforts to halt Iran's nuclear program had little or no chance of success. In essence, Biden resigned himself to the idea of a nuclear-armed Iran and told the Israelis that they, too, would have to accept that outcome.
Israeli security officials on Monday expressed concern over the remarks and saw them as further evidence that if Biden and his running mate, Senator Barack Obama, win the upcoming US presidential election, Iran's acquisition of nuclear weapons will be a foregone conclusion.
Israeli experts warn that it is only the real threat of force that stands a chance of convincing the mullahs and Iranian President Mahmoud Ahmadinejad to give up their nuclear ambitions.
HKO- tips to Bruce Tuchman. Diplomacy without a military option is another word for appeasement.
Monday, September 8, 2008
When Does a Bad Idea Become Good?
Obama apparently admitted in shrouded and obfuscated language that raising taxes on the wealthy when the economy was possibly slipping into recession may not be wise.
In a George Stephanopolis interview he hedged the wisdom of his previous tax policy. Couched in his words is the idea that tax increases hurts job growth and tax revenues. If it is a bad idea when the economy is weak, why does it become a good idea if the economy strengthens?
Is it because Obama is more concerned with income redistribution than economic growth? Is it because he is now down in the polls and he realizes that historically, candidates promising to raise taxes rarely win? Or did he finally read a freshman economics text book and learn that raising tax rates often reduces absolute tax revenues, hurting his funding for his expansive governement projects?
It is time for both candidates to stop playing football with taxes. We need a consistent tax policy, not one that changes every adminsitration. And it is time to attack the real culprit, the government debt and government spending.
In a George Stephanopolis interview he hedged the wisdom of his previous tax policy. Couched in his words is the idea that tax increases hurts job growth and tax revenues. If it is a bad idea when the economy is weak, why does it become a good idea if the economy strengthens?
Is it because Obama is more concerned with income redistribution than economic growth? Is it because he is now down in the polls and he realizes that historically, candidates promising to raise taxes rarely win? Or did he finally read a freshman economics text book and learn that raising tax rates often reduces absolute tax revenues, hurting his funding for his expansive governement projects?
It is time for both candidates to stop playing football with taxes. We need a consistent tax policy, not one that changes every adminsitration. And it is time to attack the real culprit, the government debt and government spending.
Removing Olberman
MSNBC has been taking heat for its obviously left wing bias and has removed Olberman and Matthews as news anchors.
To be honest I did not even realize that they were the anchors of an actual news show. This shows you how much I rely on the TV for news. I thought they were editorialists or on air columnists. If they were the anchors of an actual news show then their bias was totally unnacceptable.
There is a no difference between an Ann Coulter and an Al Franken, a Keith Olberman and a Rush Limbaugh, or Bill Mayer and Sean Hannity. They are all noted biased columnists. Their view are noted and they hammer for their side. None of them should have a place as a news anchor. Frankly, I prefer Dennis Miller and Jon Stewart to all of them.
When MSNBC announced Palin as McCain's pick with the subtitle "How many houses does she add to the McCain Campaign" this is not news but very biased commentary. It is good that they are correcting their coverage.
The real bias is just picking the stories to cover as much as their obvious reaction to the stories. While fawning over Obama's unmemorable but well delivered speech, Olberman's commented on Palin's electrifying speech that it was "OK if you like that sort of thing".
I wonder what this bias must have cost them in ratings or advertising to make such a change.
To be honest I did not even realize that they were the anchors of an actual news show. This shows you how much I rely on the TV for news. I thought they were editorialists or on air columnists. If they were the anchors of an actual news show then their bias was totally unnacceptable.
There is a no difference between an Ann Coulter and an Al Franken, a Keith Olberman and a Rush Limbaugh, or Bill Mayer and Sean Hannity. They are all noted biased columnists. Their view are noted and they hammer for their side. None of them should have a place as a news anchor. Frankly, I prefer Dennis Miller and Jon Stewart to all of them.
When MSNBC announced Palin as McCain's pick with the subtitle "How many houses does she add to the McCain Campaign" this is not news but very biased commentary. It is good that they are correcting their coverage.
The real bias is just picking the stories to cover as much as their obvious reaction to the stories. While fawning over Obama's unmemorable but well delivered speech, Olberman's commented on Palin's electrifying speech that it was "OK if you like that sort of thing".
I wonder what this bias must have cost them in ratings or advertising to make such a change.
Sunday, September 7, 2008
McCain Leads in the Polls
McCain is ahead on the Zogby poll 49.7 to Obama 45.9.
McCain is ahead on the Gallup Poll as of today; 48 to Obama 45.
McCain and Obama are tied at Rasmussen 46 to 46.
Yet Obama still has a spread at Intrade of 56.2 to 43.7 which has narrowed considerable since before McCain's acceptance.
What gives? Am I placing too much significance on Intrade? They were certainly out of the loop on the Palin choice until the last minute.
McCain is ahead on the Gallup Poll as of today; 48 to Obama 45.
McCain and Obama are tied at Rasmussen 46 to 46.
Yet Obama still has a spread at Intrade of 56.2 to 43.7 which has narrowed considerable since before McCain's acceptance.
What gives? Am I placing too much significance on Intrade? They were certainly out of the loop on the Palin choice until the last minute.
The Obama McCain Intrade Spread.
In a few days the polls will tell us how much of a kick the Republican GOP convention gives McCain and Palin. I hav ebeen watching the odds on Intrade.
Before McCain's speech (Ok but not nearly as electric as Palin) Obama had been pretty steady at about 60% odds favorite to McCain's 40% odds. It oscillated very little over the preceeding weeks even after Obama's speech. On 9/4/08 the respective odds were 59.5 vs 41.5, a spread of 18. The next morning the odds changed to 56.3% and 44% respectively with a spread of 12.3, a significant change and improvement for McCain overnight.
Later that day the odds spread a little back to 57.8 and 42.2; a 15.6 spread.
Truthfully, I don't know if this is significant or not. We will know if this trend continues next week. Intrade is certainly not a flawless measure but it is an interesting balance to the polls.
Before McCain's speech (Ok but not nearly as electric as Palin) Obama had been pretty steady at about 60% odds favorite to McCain's 40% odds. It oscillated very little over the preceeding weeks even after Obama's speech. On 9/4/08 the respective odds were 59.5 vs 41.5, a spread of 18. The next morning the odds changed to 56.3% and 44% respectively with a spread of 12.3, a significant change and improvement for McCain overnight.
Later that day the odds spread a little back to 57.8 and 42.2; a 15.6 spread.
Truthfully, I don't know if this is significant or not. We will know if this trend continues next week. Intrade is certainly not a flawless measure but it is an interesting balance to the polls.
Steyn on Palin
from the Corner on National Review Online
by Mark Steyn
First, Governor Palin is not merely, as Jay describes her, "all-American", but hyper-American. What other country in the developed world produces beauty queens who hunt caribou and serve up a terrific moose stew? As an immigrant, I'm not saying I came to the United States purely to meet chicks like that, but it was certainly high on my list of priorities. And for the gun-totin' Miss Wasilla then to go on to become Governor while having five kids makes it an even more uniquely American story. Next to her resume, a guy who's done nothing but serve in the phony-baloney job of "community organizer" and write multiple autobiographies looks like just another creepily self-absorbed lifelong member of the full-time political class that infests every advanced democracy.
Second, it can't be in Senator Obama's interest for the punditocracy to spends its time arguing about whether the Republicans' vice-presidential pick is "even more" inexperienced than the Democrats' presidential one.
Third, real people don't define "experience" as appearing on unwatched Sunday-morning talk shows every week for 35 years and having been around long enough to have got both the War on Terror and the Cold War wrong. (On the first point, at the Gun Owners of New Hampshire dinner in the 2000 campaign, I remember Orrin Hatch telling me sadly that he was stunned to discover how few Granite State voters knew who he was.) Sarah Palin and Barack Obama are more or less the same age, but Governor Palin has run a state and a town and a commercial fishing operation, whereas (to reprise a famous line on the Rev Jackson) Senator Obama ain't run nothin' but his mouth. She's done the stuff he's merely a poseur about. Post-partisan? She took on her own party's corrupt political culture directly while Obama was sucking up to Wright and Ayers and being just another get-along Chicago machine pol (see his campaign's thuggish attempt to throttle Stanley Kurtz and Milt Rosenberg on WGN the other night).
Fourth, Governor Palin has what the British Labour Party politician Denis Healy likes to call a "hinterland" - a life beyond politics. Whenever Senator Obama attempts anything non-political (such as bowling), he comes over like a visiting dignitary to a foreign country getting shanghaied into some impenetrable local folk ritual. Sarah Palin isn't just on the right side of the issues intellectually. She won't need the usual stage-managed "hunting" trip to reassure gun owners: she's lived the Second Amendment all her life. Likewise, on abortion, we're often told it's easy to be against it in principle but what if you were a woman facing a difficult birth or a handicapped child? Been there, done that.
Fifth, she complicates all the laziest Democrat pieties. Energy? Unlike Biden and Obama, she's been to ANWR and, like most Alaskans, supports drilling there.
tips to Douglass Ott
by Mark Steyn
First, Governor Palin is not merely, as Jay describes her, "all-American", but hyper-American. What other country in the developed world produces beauty queens who hunt caribou and serve up a terrific moose stew? As an immigrant, I'm not saying I came to the United States purely to meet chicks like that, but it was certainly high on my list of priorities. And for the gun-totin' Miss Wasilla then to go on to become Governor while having five kids makes it an even more uniquely American story. Next to her resume, a guy who's done nothing but serve in the phony-baloney job of "community organizer" and write multiple autobiographies looks like just another creepily self-absorbed lifelong member of the full-time political class that infests every advanced democracy.
Second, it can't be in Senator Obama's interest for the punditocracy to spends its time arguing about whether the Republicans' vice-presidential pick is "even more" inexperienced than the Democrats' presidential one.
Third, real people don't define "experience" as appearing on unwatched Sunday-morning talk shows every week for 35 years and having been around long enough to have got both the War on Terror and the Cold War wrong. (On the first point, at the Gun Owners of New Hampshire dinner in the 2000 campaign, I remember Orrin Hatch telling me sadly that he was stunned to discover how few Granite State voters knew who he was.) Sarah Palin and Barack Obama are more or less the same age, but Governor Palin has run a state and a town and a commercial fishing operation, whereas (to reprise a famous line on the Rev Jackson) Senator Obama ain't run nothin' but his mouth. She's done the stuff he's merely a poseur about. Post-partisan? She took on her own party's corrupt political culture directly while Obama was sucking up to Wright and Ayers and being just another get-along Chicago machine pol (see his campaign's thuggish attempt to throttle Stanley Kurtz and Milt Rosenberg on WGN the other night).
Fourth, Governor Palin has what the British Labour Party politician Denis Healy likes to call a "hinterland" - a life beyond politics. Whenever Senator Obama attempts anything non-political (such as bowling), he comes over like a visiting dignitary to a foreign country getting shanghaied into some impenetrable local folk ritual. Sarah Palin isn't just on the right side of the issues intellectually. She won't need the usual stage-managed "hunting" trip to reassure gun owners: she's lived the Second Amendment all her life. Likewise, on abortion, we're often told it's easy to be against it in principle but what if you were a woman facing a difficult birth or a handicapped child? Been there, done that.
Fifth, she complicates all the laziest Democrat pieties. Energy? Unlike Biden and Obama, she's been to ANWR and, like most Alaskans, supports drilling there.
tips to Douglass Ott
Saturday, September 6, 2008
CEO Pay and Performance
"If you put $10,000 into the stocks of companies with the highest paid CEO's of the previous year , from January 1991 to December of 2004, you would have ended up with only $8,079 while the same money invested into the S&P 500 would have yielded $48,350- that is, six times as much." from Mobs, Messiahs, and Markets by William Bonner and Lila Rajova
HKO comments- I contend that CEO and executive pay in this country is obscene. The boards and compensation committees do not represent the best interests of the shareholders. I do not believe the solution lies in government interference in corporate governance. The solution lies in better shareholder participation and empowerment.
I have no problem with the wealth of executives who gain from owning the shares of the companies they run. Stock option programs are too short term focused. Executives should be forced to hold their shares for five years or longer.
The best companies are not run by the highest paid.
HKO comments- I contend that CEO and executive pay in this country is obscene. The boards and compensation committees do not represent the best interests of the shareholders. I do not believe the solution lies in government interference in corporate governance. The solution lies in better shareholder participation and empowerment.
I have no problem with the wealth of executives who gain from owning the shares of the companies they run. Stock option programs are too short term focused. Executives should be forced to hold their shares for five years or longer.
The best companies are not run by the highest paid.
Friday, September 5, 2008
Vetting Palin
So Sarah Palin did not sell the state plane on E-bay. She listed it but ended up selling through a dealer. Did she say she "sold it on E-Bay" or did she say she "put it on E-Bay"? And then John McCain said she got a profit. The state bought the plane for $2.7 million. She put it on E-Bay for $2.5 million. The dealer sold it for $2.1 million. What was the depreciated price or the book value? If that was lower than $2.1 million then she did sell it for more than book and it was a profit.
Did she try to ban evolution in the schools? No. Just a rumor.
Did she support a Nazi sympathyzer? She wore a Pat Buchanan button when he visited, but she supported Steve Forbes (my favorite candidate) in the 2000 election, not Buchanan. Another false rumor.
Did she fire a town librarian and try to ban books in the library? May be some truth to this. She was pressured to hire the librarian back and did, and said the book banning comment was taken out of context. ???
She attended 6 colleges in 6 years? Appears to be true. So what?
She voted against the bridge to nowhere, but she originally supported it? OK.
And there are a bunch of pictures of her as a young hottie. I like the one in a very high hemmed leather tight skirt and spiked heals. The one in an American flag bikini with a rifle is a digitally synthesized fraud. I don't know which ones are real.
Palin was sprung on us without a lot of public vetting so we are getting a lot of it now. Some of it is legitimate. We know she is pro Life. Will she try to overturn Roe Vs Wade? To many voters this is a deciding litmus test issue. How tolerant is she of gay lifestyles?
Did she try to ban evolution in the schools? No. Just a rumor.
Did she support a Nazi sympathyzer? She wore a Pat Buchanan button when he visited, but she supported Steve Forbes (my favorite candidate) in the 2000 election, not Buchanan. Another false rumor.
Did she fire a town librarian and try to ban books in the library? May be some truth to this. She was pressured to hire the librarian back and did, and said the book banning comment was taken out of context. ???
She attended 6 colleges in 6 years? Appears to be true. So what?
She voted against the bridge to nowhere, but she originally supported it? OK.
And there are a bunch of pictures of her as a young hottie. I like the one in a very high hemmed leather tight skirt and spiked heals. The one in an American flag bikini with a rifle is a digitally synthesized fraud. I don't know which ones are real.
Palin was sprung on us without a lot of public vetting so we are getting a lot of it now. Some of it is legitimate. We know she is pro Life. Will she try to overturn Roe Vs Wade? To many voters this is a deciding litmus test issue. How tolerant is she of gay lifestyles?
My guess is that she is a woman of action and decision, and that she may likely have made some regrettable decisions. Anyone with leadership experience has, especially when they start in leadership positions so young.
But there seems to be a lot of half truths and deliberate misinformation. We need to learn about her, but be very skeptical about what you read. I have chastised a lot of the lies distributed about Obama. We should be equally intollerant of lies about Palin. Lover her or leave her- base it on the truth, and hopefully something more important than much of the tripe I have been reading.Duration is not Experience
Much has been said about experience in the campaign. It is important but not as much as 1. governing principles and 2. character.
I would oppose any candidate regardless of experience if they believed in subdueing individual rights, big government solutions, and divisive redistributionist economic policies.
Their character is important. Where are their roots and life experiences. Who are their associates? Are they competent and trustworthy?
What they have done is more important than how many years they have been doing it.
There is a big difference between 10 years experience and 1 year's experience 10 times.
I would oppose any candidate regardless of experience if they believed in subdueing individual rights, big government solutions, and divisive redistributionist economic policies.
Their character is important. Where are their roots and life experiences. Who are their associates? Are they competent and trustworthy?
What they have done is more important than how many years they have been doing it.
There is a big difference between 10 years experience and 1 year's experience 10 times.
The Price of Rat Meat
Election News Fatigue? Here are a a few stories you may have missed:
Modesto - A 33-year-old man who tried cutting off his arm inside a busy Denny's restaurant because he believed it would save his life was arrested Friday night, according to Modesto police. According to Sgt. Brian Findlen, Michael Lasiter, 33, of Modesto had been injecting cocaine in a nearby motel when he thought he had injected air into his veins, which can lead to death. Findlen said the man believed that if he cut off his arm, he could save himself from dying.
Australia - A pastor who inspired hundreds of thousands of people with his fight against terminal cancer has admitted he faked his illness to hide an addiction to porn. Police are now investigating disgraced pastor Michael Guglielmucci over the collection of public donations to his cancer cause. The alarm is understood to have been raised by the Hillsong Church in Sydney which revealed the pastor's hoax in an email. His deception was so great his wife quit work to care for him, he forced himseld to vomit regularly at night and even lost his hair to fool his family and the public about the extent of his illness.
Cambodia - The price of rat meat has quadrupled in Cambodia this year as inflation has put other meat beyond the reach of poor people, officials said on Wednesday. With consumer price inflation at 37 percent according to the latest central bank estimate, demand has pushed a kilogram of rat meat up to around 5,000 riel (69 pence) from 1,200 riel last year.Spicy field rat dishes with garlic thrown in have become particularly popular at a time when beef costs 20,000 riel a kg.
California - Electric and hybrid vehicles may be good for the environment, but a California lawmaker says they're bad news for the blind. State Sen. Alan Lowenthal, a Long Beach Democrat, is pushing a bill aimed at ensuring that the vehicles make enough noise to be heard by the blind and visually impaired when they're about to cross a street.
from Nutty News
Modesto - A 33-year-old man who tried cutting off his arm inside a busy Denny's restaurant because he believed it would save his life was arrested Friday night, according to Modesto police. According to Sgt. Brian Findlen, Michael Lasiter, 33, of Modesto had been injecting cocaine in a nearby motel when he thought he had injected air into his veins, which can lead to death. Findlen said the man believed that if he cut off his arm, he could save himself from dying.
Australia - A pastor who inspired hundreds of thousands of people with his fight against terminal cancer has admitted he faked his illness to hide an addiction to porn. Police are now investigating disgraced pastor Michael Guglielmucci over the collection of public donations to his cancer cause. The alarm is understood to have been raised by the Hillsong Church in Sydney which revealed the pastor's hoax in an email. His deception was so great his wife quit work to care for him, he forced himseld to vomit regularly at night and even lost his hair to fool his family and the public about the extent of his illness.
Cambodia - The price of rat meat has quadrupled in Cambodia this year as inflation has put other meat beyond the reach of poor people, officials said on Wednesday. With consumer price inflation at 37 percent according to the latest central bank estimate, demand has pushed a kilogram of rat meat up to around 5,000 riel (69 pence) from 1,200 riel last year.Spicy field rat dishes with garlic thrown in have become particularly popular at a time when beef costs 20,000 riel a kg.
California - Electric and hybrid vehicles may be good for the environment, but a California lawmaker says they're bad news for the blind. State Sen. Alan Lowenthal, a Long Beach Democrat, is pushing a bill aimed at ensuring that the vehicles make enough noise to be heard by the blind and visually impaired when they're about to cross a street.
from Nutty News
Thursday, September 4, 2008
Running Away
On the drive to Indiana I heard a radio commentator state that a survey found that 8% of white voters will vote against Obama ONLY because he is black and 20% of black voters will vote for Obama ONLY because is black.
I am suspect of such polls, because they say so little. Does this mean that black voters are more racist than white voters? How did the polls isolate the race factor from other factors such as policy? Would the same 8% have voted against Hillary because she was a woman? I suspect that these 'racist' oriented voters would have voted for the same party regardless of the race of the candidate.
Likewise I do not understand how a Hillary supporter will now vote for McCain JUST because he now has a woman on the ticket. Palin is about as politically opposite from Hillary as you can get.
Perhaps the critically important middle third that has a mixed bag of viewpoints will make the switch. These people are likely economically conservative and personally liberal. They acknowledge that evil must be fought but may disagree on how. They realize that power must be restrained whether it is in the hands of the government or the private sector. They are pro choice but it is not the litmus test issue it is for many on the left.
Personally I do not think that disaffected Hillary voters are going towards Palin and McCain; I think they are running away from Obama. I also think a lot of Obama's supporters were running away from Hillary.
I am suspect of such polls, because they say so little. Does this mean that black voters are more racist than white voters? How did the polls isolate the race factor from other factors such as policy? Would the same 8% have voted against Hillary because she was a woman? I suspect that these 'racist' oriented voters would have voted for the same party regardless of the race of the candidate.
Likewise I do not understand how a Hillary supporter will now vote for McCain JUST because he now has a woman on the ticket. Palin is about as politically opposite from Hillary as you can get.
Perhaps the critically important middle third that has a mixed bag of viewpoints will make the switch. These people are likely economically conservative and personally liberal. They acknowledge that evil must be fought but may disagree on how. They realize that power must be restrained whether it is in the hands of the government or the private sector. They are pro choice but it is not the litmus test issue it is for many on the left.
Personally I do not think that disaffected Hillary voters are going towards Palin and McCain; I think they are running away from Obama. I also think a lot of Obama's supporters were running away from Hillary.
A Force to Be Reckoned With
She comes from a working class background, sports union membership, has fought corrupt Republicans in her state government. She is successful and powerful in her own right, smart, and poised.
If she was pro choice, Sarah Palin would have made an ideal Democrat nominee.
But for her stand on this one litmus test issue, Palin would be the epitome of the role model for the modern woman. Her pro life stand makes her a target for political heresy subject to the kind of viciousness usually reserved for black heretics who dare to be called Republican.
She is tough and fearless. She had no problem turning criticisms into points of attack. "..being mayor of a small town is sort of like being a 'community organizer', except you have real responsibilities."
It is interesting that they compare her experience to Obama, not Biden. She speaks better than Obama; her presentation had more memorable lines and metaphors. She spoke clearly and flawlessly and supposedly with a broken teleprompter. It must infuriate some to a rabid froth that this Alaskan hic can out speak the Ivey League savior, and without the lavish Hollywood props.
Historically VP candidates do not have much impact, and that may or may not be the case here. Rather than placating the opposition, Palin energizes the base. Palin stands for something, and will thus be a force to be reckoned with.
If she was pro choice, Sarah Palin would have made an ideal Democrat nominee.
But for her stand on this one litmus test issue, Palin would be the epitome of the role model for the modern woman. Her pro life stand makes her a target for political heresy subject to the kind of viciousness usually reserved for black heretics who dare to be called Republican.
She is tough and fearless. She had no problem turning criticisms into points of attack. "..being mayor of a small town is sort of like being a 'community organizer', except you have real responsibilities."
It is interesting that they compare her experience to Obama, not Biden. She speaks better than Obama; her presentation had more memorable lines and metaphors. She spoke clearly and flawlessly and supposedly with a broken teleprompter. It must infuriate some to a rabid froth that this Alaskan hic can out speak the Ivey League savior, and without the lavish Hollywood props.
Historically VP candidates do not have much impact, and that may or may not be the case here. Rather than placating the opposition, Palin energizes the base. Palin stands for something, and will thus be a force to be reckoned with.
Wednesday, September 3, 2008
The Need for Misery
from American Thinker
August 29, 2008, 0:00 a.m.
Economy of Words
Dude, where's my recession?
By Jonah Goldberg
excerpts
Some 94 percent of Americans polled by Harris Interactive this month said they were satisfied with the lives they lead. Gallup reports that only 9 percent of Americans are dissatisfied with their jobs and only 13 percent are dissatisfied with their job security. The unemployment rate is at a five-year high of 5.7 percent, but it wasn't long ago when that was considered close to full employment.“
Ladies and gentlemen,” mourned Sen. Biden, the “American dream feels like it's slowly slipping away. I've never seen a time when Washington has watched so many people get knocked down without doing anything to help them get back up.”
Quick question: Was this the same Washington that oversaw the largest expansion of entitlements (aka the prescription-drug benefit) since the Great Society? Was this the Washington that recently started doling out $168 billion in stimulus checks?
Biden's keen ability to hear only awful news is symptomatic of a Democratic Party that isn't merely eager to return to the White House, but desperate to launch a new New Deal. The mind-set is on display in almost every speech.
Sen. Hillary Clinton decried the policy of “giving windfall profits” to oil companies. She seems to believe that all of the money, everywhere, is the government's, and your profits are a gift. Windfall profits are defined as too big a gift from government. Montana Gov. Brian Schweitzer, borrowing a line from Obama, complained that John McCain wants to give “$4 billion in tax breaks for Big Oil?”
No. McCain wants to lower the corporate tax rate to make us more competitive with our rivals. Yes, oil companies are included — but by this logic (as my colleague Ramesh Ponnuru notes), Obama's middle-class tax cut will be a tax break for hookers and serial killers.
The greatest irony is that the one area where the Democrats are right about American pain — high gas prices — is the one area where they're most reluctant to do anything substantial. Why? Because global warming appears to be their best shot at finding a major crisis to justify a new New Deal.
The bad news for the throngs in Denver is that Americans aren't as miserable as the Democrats need them to be.
August 29, 2008, 0:00 a.m.
Economy of Words
Dude, where's my recession?
By Jonah Goldberg
excerpts
Some 94 percent of Americans polled by Harris Interactive this month said they were satisfied with the lives they lead. Gallup reports that only 9 percent of Americans are dissatisfied with their jobs and only 13 percent are dissatisfied with their job security. The unemployment rate is at a five-year high of 5.7 percent, but it wasn't long ago when that was considered close to full employment.“
Ladies and gentlemen,” mourned Sen. Biden, the “American dream feels like it's slowly slipping away. I've never seen a time when Washington has watched so many people get knocked down without doing anything to help them get back up.”
Quick question: Was this the same Washington that oversaw the largest expansion of entitlements (aka the prescription-drug benefit) since the Great Society? Was this the Washington that recently started doling out $168 billion in stimulus checks?
Biden's keen ability to hear only awful news is symptomatic of a Democratic Party that isn't merely eager to return to the White House, but desperate to launch a new New Deal. The mind-set is on display in almost every speech.
Sen. Hillary Clinton decried the policy of “giving windfall profits” to oil companies. She seems to believe that all of the money, everywhere, is the government's, and your profits are a gift. Windfall profits are defined as too big a gift from government. Montana Gov. Brian Schweitzer, borrowing a line from Obama, complained that John McCain wants to give “$4 billion in tax breaks for Big Oil?”
No. McCain wants to lower the corporate tax rate to make us more competitive with our rivals. Yes, oil companies are included — but by this logic (as my colleague Ramesh Ponnuru notes), Obama's middle-class tax cut will be a tax break for hookers and serial killers.
The greatest irony is that the one area where the Democrats are right about American pain — high gas prices — is the one area where they're most reluctant to do anything substantial. Why? Because global warming appears to be their best shot at finding a major crisis to justify a new New Deal.
The bad news for the throngs in Denver is that Americans aren't as miserable as the Democrats need them to be.
Tuesday, September 2, 2008
Life Imitates Politics
The Obamaniks blasted McCain for issuing an ad comparing Obama's celebrity status to Britney Spears and Paris Hilton. Kudos to Paris for having some fun with the ad by posing in a bikini and delivering a cogent energy policy.
The right wingers had a field day on the opulent facade used for Obama's acceptance speech. A 'facade' many said was the perfect backdrop for the candidate with no experience and real substance to be president.
The stage was designed by Bobby Allen of RDA Entertainment who also designed the stage set for .... Britney Spears.
Some campaigns just write themselves.
The right wingers had a field day on the opulent facade used for Obama's acceptance speech. A 'facade' many said was the perfect backdrop for the candidate with no experience and real substance to be president.
The stage was designed by Bobby Allen of RDA Entertainment who also designed the stage set for .... Britney Spears.
Some campaigns just write themselves.
Monday, September 1, 2008
Obama and Unions
Less than 12% o the workforce are union members. Yet 25% of the Democrats at the convention were union members or married to union members. It is another way the Democrats are disconnected from the voters.
Hillary's speech made several nods to the union vote. The party stands against right to work states, meaning that a worker can choose not to join a union even if it is a union shop. The party also calls for the abolition of the secret ballot during a union election. This allows the union to know who voted for it and against it in order to intimidate the voting worker.
The unions are known to use physical intimidation to gain power. They certainly did years ago when they tried to unionize my workforce. Other than lies and threats they had nothing to offer.
Once a union is voted in the worker gives a portion of his salary to union dues. By eliminating the secret ballot they can more easily intimidate workers to vote the union in, and by eliminating the right to work option they can force workers to give the unions more money; money used to support their favorite political candidates which are overwhelmingly Democrat.
It is the most naked and shameless political power play and it is totally supported by Obama and the Democratic Party.
from the WSJ Political Diary:
Democrats and the Non-secret Ballot
DENVER -- Democrats narrowly avoided a major embarrassment before holding their abbreviated roll call of the states here on Wednesday night.
Politico.com reported that the Obama campaign was seriously considering letting delegates vote by secret ballot, the better to avoid intimidation and fear of reprisal from local party bosses. But the plan -- which was pushed on the Obama camp by supporters of Hillary Clinton -- was suddenly dropped when it was realized that a key plank of the Democratic Party platform backs a so-called "card check" provision being added to the nation's labor laws. Card check would effectively strip workers of the protection of secret ballots in union elections. Business groups and former Democratic presidential nominee George McGovern oppose the measure on the grounds that it exposes workers to harassment and intimidation.
That was precisely the concern of Democratic delegates who wanted to cast a secret ballot vote on the convention floor. The Obama campaign thought seriously about accommodating them until it realized how such a naked contradiction to the party's stance on union balloting might look to voters and the media.
Hillary's speech made several nods to the union vote. The party stands against right to work states, meaning that a worker can choose not to join a union even if it is a union shop. The party also calls for the abolition of the secret ballot during a union election. This allows the union to know who voted for it and against it in order to intimidate the voting worker.
The unions are known to use physical intimidation to gain power. They certainly did years ago when they tried to unionize my workforce. Other than lies and threats they had nothing to offer.
Once a union is voted in the worker gives a portion of his salary to union dues. By eliminating the secret ballot they can more easily intimidate workers to vote the union in, and by eliminating the right to work option they can force workers to give the unions more money; money used to support their favorite political candidates which are overwhelmingly Democrat.
It is the most naked and shameless political power play and it is totally supported by Obama and the Democratic Party.
from the WSJ Political Diary:
Democrats and the Non-secret Ballot
DENVER -- Democrats narrowly avoided a major embarrassment before holding their abbreviated roll call of the states here on Wednesday night.
Politico.com reported that the Obama campaign was seriously considering letting delegates vote by secret ballot, the better to avoid intimidation and fear of reprisal from local party bosses. But the plan -- which was pushed on the Obama camp by supporters of Hillary Clinton -- was suddenly dropped when it was realized that a key plank of the Democratic Party platform backs a so-called "card check" provision being added to the nation's labor laws. Card check would effectively strip workers of the protection of secret ballots in union elections. Business groups and former Democratic presidential nominee George McGovern oppose the measure on the grounds that it exposes workers to harassment and intimidation.
That was precisely the concern of Democratic delegates who wanted to cast a secret ballot vote on the convention floor. The Obama campaign thought seriously about accommodating them until it realized how such a naked contradiction to the party's stance on union balloting might look to voters and the media.
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