Tip Of The Iceberg

I've spent a few days catching up with the Bernard Madoff story (as well as the smaller but no less spectacular Marc Dreier tale of woe). I have a couple of thoughts and observations to make.

 

First, this is just the beginning. As with all things financial, the first shock is never the last, as things like this ripple through the interconnected financial world. Look at how the "contained" (to use Henry Paulson's term) subprime mortgage meltdown took over the entire commercial banking system.

 

Before we go much further, I need to do a quick primer on what Madoff and Dreier did. It involves a term you might have heard called a "hedge fund". A hedge fund is nothing more than a pool of money that places sophisticated bets on individual companies and/or stock indices. Usually, because the chance for profit is much higher, they will bet against a company or market by "shorting" the stock or borrowing shares from someone with the promise to pay for them later, turning around and selling them, then buying other shares back when the price drops and "paying" back the original loan. There are other, even more complex arrangements that hedge funds engage in, like derivatives and leverage, and I might cover those in later articles.

 

There are plenty of complications to short selling, not least of which is the possibility of unlimited losses: if the shares never go down below the "sales" price, the borrower can't earn any return. The upside is, it's about the only way to make money in a down market. 

 

Hedge funds, therefore, spend an extraordinary amount of time looking for companies that are about to fail in some respect: revenues off, profits down, dividends cancelled. Obviously, they try to do this before the rest of the market finds out.

 

Hedge funds are also exempt from the very tight oversight rules of the SEC that apply to brokerages by dint of the fact that one has to be a "qualifed" or "accredited" investor (the rules are a bit complex, but suffice it to say to be either of these, you gotta have bucks). These are in effect private, invitation-only investments, and the investors are expected to have some financial sophistication, as evidenced by the fact they have $1 million or more.  

 

As the Madoff case shows, not so much.

 

While the grunt work of a hedge fund relies on quantitative analysis (number crunching), the marketing work of a hedge fund relies primarily on the qualitative properties of the fund manager.

 

Which leads me to observation number two: there's no accounting for greed. By all accounts, Madoff should have been a successful manager. He was a chairman of the NASDAQ, which means he had an awful lot of success investing, and had credentials and contacts out the wazoo.

 

Time will tell us how he failed so miserably, but the clear lesson from Madoff's point of view is, he got greedy.

 

You see, fund managers are generally entitled to a percentage take of the profits (normally 20%) as well as a percentage of the assets in play (usually 1%) to cover administrative expenses (salaries, normally). Obviously, the higher the nut, the larger the percentage take is in real dollars. If you manage actual assets of $15 billion, as Madoff did, but can leverage these to three or four times their size, as Madoff did, you can claim $50 billion in assets and ignore the liabilities, because hey, they're going to be paid back! On paper, you've just earned $7 billion in bonuses and can claim $500 million in expenses.

 

Not bad, eh? So you can understand why Madoff didn't just toss the keys on the desk when his investments went sour.

Which brings me to point number three: there's no accounting for greed. (What?)

 

How he sold these stakes in his fund is simple: he dummied up numbers, attracted the right kind of attention and was able to practically hand out stakes in his fund. He all but promised a 12% return each year, allowing people to fill in the "promise" bit on their own. So long as he was able to expand his investment pool, the sky was the limit in terms of how much money he would control but also how long he could pay out 12% returns. 

 

This is why hedge funds are run on the rule that the investors have to have sophistication, because the opportuinity to bilk people is too juicy. You're supposed to know to ask questions, the right questions. Apparently, enough people didn't, dazzled by doubling their money eveery six years. 

 

Clearly, the SEC, which has nominal oversight over hedge funds, gave Madoff a pass, which brings me to point number four: too often, we are led by authority and don't question it. We saw it after Obama took the nomination, the number of liberals who creid foul as Obama correctly shifted to more centrist positions. We see it in the Madoff case. Hey, the guy was chairman of NASDAQ just ahead of the tech boom! 

 

Point number five (and echoing point number one) is that hedge funds have already been responsible for the collapse of Bear Stearns, Lehman Brothers, and Fannie Mae and Freddie Mac. Indeed, some speculation has it that hedge funds are responsible for the year long collapse of the global stock market.

 

Now, take that bit of information and add this bit of information: in America alone, hedge funds control 3/4's of a trillion dollars in assets. That's roughly half of the assets under management worldwide.

 

Put it this way: hedge funds as a nation would rank 8th, just ahead of Spain and just behind Germany.

 

Suddenly, you see that Madoff is peanuts, the tip of the iceberg, the first crack in the veneer of ice over the abyss. We're a long way from bailing out this boat.

Twelve Days of Christmas Music Blogging

Luciano Pavarotti - O Holy Night

Godspeed, signore.

Shoes For Industry! Shoes For The Dead!

Despite the igominy of suffering the worst insult an Iraqi can afford, short of shooting him, George W. Bush managed to steal some of Obama's thunder and theme today, and showed that he is still going to either extricate his legacy or go down whining:

The most recent draft stipulates that American forces will withdraw from Iraqi cities by June 2009 and from the country by the end of 2011, and contains amendments made by the Americans in response to Iraqi demands made last month.

"The deliberations are continuing in the cabinet in order to ascertain the scope of the amendments that have been added in order to reach a clear agreement and to see if it is acceptable to parliament," Safaldin al-Safi said. "The American response contained many positive elements, but at the same time it contained clauses that require more discussion," the head of Iraq's parliamentary affairs committee said in a statement Tuesday.

Many would say that this is Bush trying to steal Obama's thunder, and I'm sure there's some element to it. After all, Obama ran directly against the Bush invasion record, a point magnified by Senator John McCain's famous comment that Obama should have run against Bush in 2004 if he felt that strongly about it.

 

The November election was a clear and direct repudiation of Bush's tactics over the past 8 years and the wrong-headed decision to invade Iraq in the first place. That has to sting any man, but a man like Bush, whose entire Presidency seems to have been predicated on the "Look what I can do, Daddy!" tactics of a four year old, it must be a very deeply felt rebuke.

 

Which is why I'm not convinced this is entirely the attempt on Bush's part to leave a "Fuck You" card on the Oval Office desk.

 

I think Bush, a young man, is facing up to decades of trying to repair not his image, but his self-esteem. It hit that deeply.

 

In recent interviews that I've watched, Bush seems more introspective, more appreciative of the fact that he made a mess of things-- even if he'll deny the majesty of his bungles and blunders. I attribute this to the November 4 slap in the face. Rightly or wrongly placed as Bush's surrogate, had McCain made it close-- a tight race in the electoral college or the popular vote-- Bush would walk away with his head held high and his self-perceived dignity intact.

 

But that didn't happen, did it? And despite some of the right wing's most egregious fanbois claiming that Bush is still loved and cherished, well, let's just say that the parties who love and cherish him are not the kind of people I'd invite to dinner.

 

It is on this landscape that Bush surveys the damage he has done to American credibility and economic and military strength, and tries to repair the damage he has wrought.

 

If that is the case, if indeed Bush walks away from the past eight years a man broken of his hubris and braggadoccio, then this tiny baby step, too little and far too late, should be credited to him. A nip in his hide against the huge hole he has left in the flesh of humanity.

 

And if it is not the case, then it should be credited to Obama for forcing Bush's hand. We will not know, but history will be the final arbiter of that judgement.

 

I'm a liberal, and compassionate, and willing to believe the best in a man no matter how badly he's behaved. I'd like to believe Bush has learned his lesson.

Twelve Days of Christmas Music Blogging

David Bowie & Bing Crosby - Little Drummer Boy/Peace On Earth

Arguably the weirdest collaboration ever staged. Bing looks a little uncomfortable at times.

From the Thumbper Files

I haz a sadd to riport dat Socks, fourmr Wite Haus prez-cat an' Buddy ovrloard, iz cloz to a meting wit CeilingCat. He'z berry admrbl fur hiz gud werks an' luvbl naychrs.

Twelve Days of Christmas Music Blogging

Bob Marley - Christmas Reggae

Nobody Asked Me, But...

1) Irony of ironies, the contractor who is being held accountable for the fire at the Deutsche Bank building that killed two firefighters in 2007 is the John Galt company. Yet another nail in Ayn Rand's coffin.

2) Notice who is the general opposition to the bailout: Republicans from Southern states. Why? Simple: Who benefits from the bankruptcy of GM and the reorganization? The south. How? Right-to-work states which are openly hostile to unions. GM, Ford, and Chrysler would be free to move their operations down south and save gobs of money on union salaries. Disgraceful!

3) Santa Kitty is going to leave coal in his litterbox!

4) Not pretty. Not at all.

5) I think this may be a dead cat bounce.

6) How many of you skipped this year's shot?

7) Either this guy is a lousy kisser or a great one, I'm not sure.

8) This is one of the more bizarre "terrorists" around. Not deadly, yet, but more of a nuisance. Yet, he or she always manages to show up at the oddest places.

9) This is one of my greatest fears when I am performing.

10) Free trip to London? Plus a Fish Slapping Dance? AWRIGHT!

So How Bad Is It, Really?

This bad:

 

In the market equivalent of shoveling cash under the mattress, hordes of buyers were so eager on Tuesday to park money in the world's safest investment, United States government debt, that they agreed to accept a zero percent rate of return.

The news sent a sobering signal: in these troubled economic times, when people have lost vast amounts on stocks, bonds and real estate, making an investment that offers security but no gain is tantamount to coming out ahead. This extremely cautious approach reflects concerns that a global recession could deepen next year, and continue to jeopardize all types of investments.

A quick finance lesson for those of you who didn't attend B-school. Interest is essentially the cost of borrowing money (there's a lot more and that's very simplistic, but I digress). If you borrow $100 from me, that's $100 I don't have. I charge you $2 interest, because I can make at least that much in another investment.

 

Let's assume inflation is a factor, for a second, and inflation would eat up $1 of the $100. I still come out ahead. Presumably, you being a rational person, use the $100 to make a quick $3 or more. You come out ahead.

 

If I lend you the money at zero interest, it means that I lose money over time. I don't recapture that $1 that inflation has eaten up. I effectively get $99 for lending you $100. Under what scenario does this arrangement work.

 

When inflation is a negative, or economic growth is contracting.

 

So in other words, the global financial markets have factored in the entire world economy. They've taken into account China, and India and Russia. And they've decided that, for the next thirty days (which includes the last two weeks of Christmas shopping), the economy is going to go south like nobody's business. They're not worried about making money: they're worried about losing more money than they already have.

 

Too, some global investors are scared enough that the Treaasury auctioned off some 3-month notes for zer percent, meaning those pessimists believe things won't get better before next Spring.

 

Personally, I would have taken zero on 12 month notes.

 

It's a very weird world out there. The dollar, which had hit some recent historic lows against the euro and pound, is suddenly the place to invest, primarily because oil prices, tied to the dollar, have collapsed, making dollars more freely available on the market. You'd think this would be good news to stock markets, but you'd be wrong.

 

The dollar being strong and the US Treasury being able to float zero interest debt actually caused the market to drop. My guess is this is mopre pyschological than economic: I see this as the last stand of the American government. For too long, we've lived on borrowed money, buoyed only be the fact that we've been able to see the private sector, similarly buoyed, scratch out some economic growth in this decade.

 

Despite Bush's tax cuts, which have done nothing for the real economy and only helped speed up the shuffling of paper in the fantasy economy.

 

The bailouts of so many businesses in so many key economic sectors (wait till the airlines start lobbying) has Wall Street worried, and rightly so.

 

When does the spigot turn off? What companies will be left standing when the music stops and the chairs are full? What happens when Uncle Sam himself turns empty pockets inside out?

Whoa!

Well, I figured there would be some fallout from the whole Illinois corruption thing, going back to the Rezko trial, but this?

Gov. Rod Blagojevich and his chief of staff, John Harris, were arrested today by FBI agents on federal corruption charges.

 

Blagojevich and Harris were accused of a wide-ranging criminal conspiracy that included Blagojevich conspiring to sell or trade the Senate seat left vacant by President-elect Barack Obama in exchange for financial benefits for the governor and his wife. The governor was also accused of obtaining campaign contributions in exchange for other official actions.

 

Blagojevich was taken into federal custody at his North Side home this morning.

Ouch. Naturally, Obama's sainthood is tarnished just a little by this revelation, but it doesn't touch him beyond that, as far as anyone is saying. Too, it would have to take a mistake of monumental proportions for this to somehow get tied back to Obama. I suspect he was purposely left completely out of the loop in any way, shape or form. At worst, someone lower-level in his campaign organization will take a fall for even discussing Obama's noninvolvement.

 

However, it is unlikely that Obama became such a powerful force in Illinois politics without having to dip his hand into this barrel of slime at some point, and that will likely come back to haunt him.

 

Blagojevich is a particularly unctious little creep, judging by the various investigations that he is or has been the subject of, but Illinois has a long history of people like this, from former governor George Ryan to the infamous Daley machine. It's not pretty.

 

It's possible that Obama's fast rise was predicated on keeping him out of the muck in this machine, much like Harry Truman managed to win the Presidency despite being a member of the Pendergast machine of the 40s and 50s in Missouri. Truman had a few brow-raising favors traded with Pendergast, but much of the dirty work seemed to take place around him but avoiding him directly.

 

Or he avoiding it.

 

Either way, the rest is history, and one can hope that the same can be said for Obama.

 

The difference, of course, is the Republican party today plays a far nastier and unctious game themselves and it's not out of the question that this shadow will hang over and hamper the Obama first term almost as much as the Lewinski affair nearly defined the Clinton legacy.

Point Of Posting Order

I'm still working out the shortcomings of being forced by circumstance to post to Simply Left Behind via e-mail.

 

For example, in this morning's post, I had to post the same thing twice since for some reason, Blogger decided to truncate the original post at the quote from Hildebrand.

 

There were links and everything!

 

I copied it to a new e-mail, posted it again and then deleted the original post. Unfortunately, the links and formatting did not copy over. I will fix these tonight.

 

Please bear with me as I try to figure out a better way and please accept my apologies for the confusion. It was a really good post, and I hate that it was confounded by slopping editing on my part.

Horrors!

Goodness gracious! A politician allowed the delusional to maintain their delusions just long enough to get him elected!

I could go on and on. The point I'm making here is that our new president, the Congress and all Americans must come together to solve these problems. This is not a time for the left wing of our Party to draw conclusions about the Cabinet and White House appointments that President-Elect Obama is making. Some believe the appointments generally aren't progressive enough. Having worked with former Senator Obama for the last two years, I can tell you, that isn't the way he thinks and it's not likely the way he will lead. The problems I mentioned above and the many I didn't, suggest that our president surround himself with the most qualified people to address these challenges. After all, he was elected to be the president of all the people - not just those on the left.
As a liberal member of our Party, I hope and expect our new president to address those issues that will benefit the vast majority of Americans first and foremost. That's his job. Over time, there will be many, many issues that come before him. But first let's get our economy moving, bring our troops home safely, fix health care, end climate change and restore our place in the world. What a great president Barack Obama will be if he can work with Congress and the American people to make great strides in these very difficult times.

 

While I respect the voices on the far far left....sheesh, and all this time I thought I was the wild-eyed idealist who wanted sparkle ponies for the poor and edible rainbows...Hildebrand's got it right: We are Democrats. We are not Republicans who will lead by ignoring the larger issues of the nation for the sake of focusing down narrowly.
 
We tried that for six of the past eight years and look where it got us. We should, as Jesus teaches, turn the other cheek, and welcome our rivals, enemies, loyal opposition, into the fold to help us guide this nation forward.
 
No one in this country, with the possible exception of me, has all the right answers at his fingertips, cross-referenced and readily vetted. If the other side has answers, like we had under Bush, then we ought to know about them and take them seriously into consideration, if such ideas warrant serious consideration.
 
And if not, we're free to ignore them on merit, but let it never be said that we ignored them out of spite.
 
Too, with all the frou-frouing over Obama's Cabinet appointments and advisors, the left loses sight of the single most important fact of all:
 
That's President Barack Obama.
 
Had any of the panty-wetters pondered the possibility that President Obama has chosen these people to counterweight his own more liberal tendencies? After all, what's the point in having "yes men" all around you? What do you learn that you didn't know already? And hasn't the past eight years proven how dangerous it is to have an intellectually uncurious mind occupying the Oval Office?
 
I doubt it, based on what I'm reading, which seems to be some Bizarro-world warping of reality. It's almost as if these folks expected Barack Obama to somehow morph into a Dennis Kucinich/Bernie Sanders clone, replete with left-wing policies, and now they're claiming that Obama isn't listening enough to them.
 
So really, fellow libs, to echo Hildebrand (by way of Hamsher): STFU.

Nobody Asked Me, But...

1) I guess Ileanna punk'd herself.

2) Senator Chris Matthews. It sounds about as appealing as sock soup.

3) There may be more to come from India.

4) Zimbabwe really is falling apart.

5) Last month, it hurt to be a retailer.

6) Maybe we should ask for a recount for McCain after all? "Change" means "think different," Mr President-Elect.

7) Shhhhhhhhhhhhhh! You'll wake the neighbors!

8) I may move to Australia just to run for office!

9) The worst hotel in the world.

10) This historical figure would hate Sarah Palin.

Another Day Older And Deeper In Debt

It really does feel like toting sixteen tons, this past year.

 

My thanks to Katrina for noting that, indeed, today is my birthday. I got the greatest birthday present I could have imagined..well, almost but it was very close...precisely a month ago:

So thank you all for that.

 

It's been an odd year, to put it very mildly: skin cancer, plastic surgery, a crazed mother, MRSA, an economic collapse, an election, and 2009 has already thrown down its marker to try to top this past year.

 

It's not going to be pretty, not for all of us, not for the world, and not for me personally. That's not to say all news is bad, of course. We did elect Barack Obama, which tells me people across the country are waking up after the Bush years and realizing we just threw a party we could neither afford nor could keep away from the punch bowl. Now comes the hangover, but in hangovers can come some good, like making a note not to do that again.

 

And we won't. For a while. I hope the next time we do something this stupid, I will have shuffled off the mortal coil. It seems pretty certain that will be the case. I recall growing up with stories of the Depression, so the generation after mine probably skipped those stories and now they'll have their own to tell their children and grandchildren. Figure at least a half century before we allow human avarice to overcome our sense of mortality.

 

Most news, good or bad, is an illusion. As the saying goes, it's never as good or bad as it seems. In all good news, there are the seeds of its own demise, likewise in bad news the seeds of new hope. All births result in death. All deaths, in births.

 

Forgive me. I'm a bit melancholy at the moment, but as I face a few facts-- I have more days behind me than in front, we have elected a President who is younger than me for the first time-- I'm struck by how lingering and looming my mortality is, and how little I truly have accomplished.

 

I've not finished writing a book yet...started a dozen or so and even have one outlined to completion, but never finished one. I've not run for public office to truly try to help people who need it. I could, but I won't because I have too many skeletons.

 

I feel underappreciated.

 

Not by you guys, no way. Not even by the trolls who fester and pop up every so often here and in other places online. My "family" here is wonderful, and I love you all for that.

 

I feel underappreciated by myself. At my very core is this interior monologue that's saying to me "you can do better, so why won't you?"

 

Indeed, why not? To quote RFK: "Some people see things as they are and say why? I dream things that never were and say why not?"

 

I dream the dream. I ask the question. Yet I find myself lacking the strength to carry out the answer.

 

Funny thing about it is, I'm a hypercompetitive person. I was the kid on the other team you never wanted to play against, because I would find a way to beat you for my team's sake. I was the goalie who could lose his mask and glove and risk breaking his wrist to catch a puck, or the quarterback who limped out on a bad knee or broken toe, all of which I've done and all of which I'm paying the price for now. So why not for me?

 

Enough introspection. Where's my fucking cake????

Happy Birthday, Actor212!

May you be Healthier, Wealthier, and Wiser!
Or at Least Two Out of Three.
=^..^=

Hump Day Comedy Blogging

Hump Day Comedy Blogging

Controlling cat is controlling

Worse Than Anticipated

There are some eye-opening tidbits in the latest private sector jobs report:

NEW YORK (CNNMoney.com) -- The U.S. economy shed a quarter-million private-sector jobs in November, according to a payroll processor's report that was worse than economists expected.

Non-farm private employment fell by 250,000 jobs from the previous month on a seasonally adjusted basis, according to the ADP National Employment Report.

The report was expected to show a decline of 200,000 jobs in November, according to a consensus of economist projections compiled by Briefing.com.

The goods-producing sector lost 158,000 jobs last month, its 24th consecutive month of decline, according to the report. This includes 118,000 positions in manufacturing and 44,000 construction jobs.

The service industry shed 92,000 jobs, its second month of losses since the ADP reports began tracking employment in 2002.  

So you can see, this recession has been a long time coming and very slow to develop, like a really really bad flu. And it will take a long time to work its way through the system.

 

It's very unusual for a jobs report to be 25% understated from predictions, in either direction. These folks usually have a pretty good idea what's going on in the marketplace. My suspicion is a lot of business-owners just tossed the keys on the bank manager's desk and said, "Here, you deal with this."

 

It's not a whole lot different walking away from a business than it is walking away from a house, to be sure.

 

Note too that for seven years, the service sector has added jobs every month except one (have to look that up), until last month. And keep in mind that this is just ahead of the Christmas season, when retailers normally hire both temps and permanent workers. The fourth quarter is when retailers justify their 2009 budgets.

This report differs from the "official" jobs report, because it ignores government jobs. When Bush expanded the Department of Homeland Security, in effect, he created a mask for the really horrendous employment numbers of the manufacturing sector of private industry, banking heavily on the snapshot reporting of not only the network news organizations, but of the business channels as well.

 

After all, when was the last time you heard Brian or Katie or Charlie say anything more than "The jobs report came out today and the unemployment rate is..."?

 

Possibly someone on CNBC (forget FOX Business News) will invite a contrarian on to discuss the numbers who will point out that private sector hiring is lagging. Maybe. And that's usually in the middle of the day when everyone is watching the ticker.

 

So when someone tells you this recession is a product of the subprime meltdown and the credit crisis, keep this article in mind. This thing has been a long time coming and is developing very slowly, and will take a long time to work its way thru the belly of the beast.

The Blind Leading The Blonde

I don't normally point a finger at right wing nutcases, since we on the left have our own set to deal with, but, while the overt point regarding Barack Obama's election is made, the undercurrent of nastiness from this odious little creep is rather fragrant:

Talking with correspondent John Yang, who was covering the Obama side of the story, Witt conceded that while "you certainly can't expect things to change on a dime overnight....There had been such a global outpouring of affection, respect, hope, with the new administration coming in, that precisely these kinds of attacks, it was thought — at least hoped — would be dampered down. But in this case it looks like Barack Obama is getting a preview of things to come."

 

It almost seems like a parody of liberals' blind worship of Obama to actually expect that The One's election would mean terrorists hanging up their bomb belts, peace around the world, lions lying down with lambs, and so forth. For his part, Yang delicately pointed out the more valid concern that "the enemies of the United States, those who don't care for the United States no matter who's leading it, would try and test the United States" during the transition from Bush to Obama.

True, Witt made a really dumb statement, the kind of statement one makes when one has dead air to fill and a dead head to fill it with. And I mean no disrespect by "dead head". We all hit a point in our lives when for various reasons, we can't come up with a cogent way of phrasing something.

 

But Noyes is annoying in assuming that Witt is a "liberal" just because she works for MSNBC, which admittedly has a more liberal bend than FOX News or even the Volkischer Beobachter of Hitler, which I think is slightly more liberal than Hannity.

 

Indeed, one can make a strong case that in fact Witt is a right-winger and making this comment in a subtly sarcastic tone.

 

More likely, one can make the truer case, which is that Witt is an idiot. An idiot who swallows right wing talking points whole.

 

Something I suspect Noyes wishes she would do more often, but I digress.

 

I can imagine Rush Limbaugh sneering this whole meme, almost word for word: "[Now, friends] you certainly can't expect things to change on a dime overnight....There had been such a global outpouring of affection, respect, hope, with the new administration coming in, that precisely these kinds of attacks, it was thought — at least hoped — would be dampered down. But in this case it looks like Barack Obama is getting a preview of things to come."

 

Which given Witt's track record sounds more like what she intended that what Noyes is spewing out his ass.

An Emotional Choice

If this story is true, then I will never vote for Hillary Clinton for Senator again:

WASHINGTON - Hillary Clinton passed on becoming boss of the superpowerful Senate Appropriations Committee to pursue the more prestigious secretary of state job with President-elect Barack Obama, the Daily News has learned.

As chairwoman of the panel that controls the nation's purse strings, Clinton could have pumped billions in federal dollars into the Empire State.

Instead, as Obama continues to piece together his cabinet, Clinton is poised to become the third female secretary of state, following Madeleine Albright and Condoleezza Rice.

Of course, I make that threat tongue-in-cheek.

This offer was made in part because, as the article goes on to state, Sen. Edward Kennedy did not want Hillary on his health care taask force.

 

I guess his ego was a bit too large to fit in the same room as Hillary's.

 

Not to begrudge Kennedy a thing. I would have done the same thing if nearly all of my adult life I had been pursuing an agenda on a signature piece of legislation, and after all, this is likely his last turn as the Liberal Lion of the Senate. Why share the spotlight?

 

Hillary's celebrity would have, of course, both assisted the cause and distracted attention from the legislation. That might not be a bad thing in a nation that may not quite be ready for national health care.

 

It is interesting that Hillary would turn down a chance to skip way ahead of the crowd in the Senate in order to re-plow ground that's been turned over twice already. I think I know why.

 

She intends to be the Secretary of State credited with ending the Israeli-Palestinian conflict, and bringing peace to that corner of the Middle East. By extension, she could end terrorism as we in America know it.

 

Let's face facts: she has a certified ace in the hole in husband President Clinton here. He has credibility amongst both the Israelis and Palestinians and her own "cred amongst Jews" is very high. After nearly eight years of intense and delicate negotiations, Bill Clinton set the bar for peace in the Middle East at an attainable level with the Camp David talks with Ehud Barak, who paid a hefty price for not bringing home an accord with Arafat (I won't get into a discussion of the finer points of the talks, other than to say that Arafat was handed the world on a platter and decided he'd rather check out the buffet first).

 

So certainly Hillary Clinton could make a mark, an indelible mark, on the history of the world and in the same motion, tweak the noses of folks who thought she wouldn't be an effective president because she couldn't bring about change.

 

So, Appropriations is a powerful post and in that seat, she could have effectively assisted New York state in overcoming what is amounting to "Ground Zero" of the Bush Depression. She could have been any one of a number of senators who have held that seat (most recently, Sen. Robert Byrd and disgraced Sen. Ted Stevens) and brought home so much pork, she contracted trichinosis.

 

Or she could wave goodbye to all that, and move on to bigger and better things.

 

Now does anyone doubt Hillary's reasons for wanting to be SoS?

Friday Kitten Blogging

Hai, mah peeps!

Dadby gawt hesseff a noo bideo camra, so I thought I wud plai wif et.

Diss es me, waten foah hem to coem hoem.

Friday Music Blogging

Steely Dan - Black Friday

OK, obvious choice, but Walter Becker was graduated from my alma mater.

Nobody Asked Me, But...

1) She deserved this. She deserved a lot more. Somehow, I think karma is about to prove to Lori Drew that it's the bigger bitch.

2) In a phrase: Not Good.

3) Were you at WalMart at 5 AM? Kohls at 4? Then you helped write this article.

4) It seems as if Europe might be immune to this recession. But that's because they've had actual leadership during it all.

5) I haven't heard the entire album yet, but maybe Axl should not have rushed it to the stores...you know, take a little more time, overproduce it a little bit more, stuff a few more guitar solos in it, maybe include a free puppy with every purchase...

6) In other Chinese Democracy news...

7) Question: Why not Bill? He's going to have an awful lot of time on his hands the next four years...

8) They take mugshots for loitering in LA????

9) And let's not forget the latest terror group: nudists. "I swear officer, I really WAS just happy to see her!"

10) In California, this would be illegal.

For Thanksgiving

We're often asked to reflect on this day, set apart to acknowledge whatever bounty we've gotten in the past year's harvest, and give thanks for our blessings.

This year, it's been pretty tough to come up with much.

First, let's thank America for waking up to what's happened to this nation in the past eight years and having the guts and determination to do something about it. And so long as we're thanking America, let's thank her for not tumbling into the abyss in the past eight years. Despite our loss of freedoms and respect, she has managed to provide us a bulwark from tyranny beyond that which Bush & Co. have managed to steal.

After all, we aren't forced to keep our two-way televisions on 24 hours a day. There's something to be thankful for there.

We should be thankful that America isn't going thru what is happening in Mumbai and if that means some petty minded bigot of low expectations wants to grab the credit for Bush, so be it. I disagree, of course: Bush has only inflamed a situation, and the only reason we haven't been attacked has been logistical. They *want* to attack us and want to, badly.

It has just been dumb luck they haven't bothered to try very hard. As I said, we should be thankful that George Bush didn't buck history and become the first President to have TWO Al Qaeda attacks on his watch, but it seems small beer to be lowering the bar that far.

So long as we're thanking Bush, I want to thank him for the past eight years, which have served as a reminder to the American people that we aren't that far evolved from the muck and mire that most nations have to live under. We aren't that superior, because our system only works really well when we put smart people in places of power. I'll have a post in January that details this more.

When we put venal, petty, partisan, short-fingered vulgarians in charge, we suddenly turn into a banana republic without the umbrella drinks.

We must thank Barack Obama, for making us see the possible again. Politics has been called "the art of the possible," so now let us pray that President-designate Obama (the electoral college doesn't meet for a few weeks) is a true artist.

Too, let us thank Hillary Clinton for pushing thru the glass ceiling that made Obama's candidacy and election less likely. 18 million cracks later, and we see a black man and a white woman standing as examples to our children that say "Yes, you can".

I want to thank John McCain, too, but I'm not sure for what. For selecting Sarah Palin and in one step rendering the Republican party irrelevant for decades? Possibly, but I think it's important to have two strong parties. Just look at the past eight years to see what happens when one party can dominate the other.

I guess, finally, we thank everyone in our lives who has helped us get to this day, alive and able.

And from me, thank you for reading this drivel on a daily basis.

Namaste

As a New Yorker, my thoughts and prayers are with my brothers and sisters in Mumbai tonight.

It shouldn't happen to anyone, and when the dust settles, I hope the bastards are bought to justice. For now, heal.

के रूप में एक नई यॉर्कर, मेरे विचार और प्रार्थना मेरे भाई और मुंबई आज रात में बहनों के साथ कर रहे हैं.

यह किसी को भी, और नहीं होना चाहिए जब धूल, सुलझेगी मैं
इस कमीनों न्याय करने के लिए खरीदा जाता है उम्मीद है. अभी के लिए, चंगा.

A Tale Told By Idiots

[I]t is a tale
Told by an idiot, full of sound and fury,
Signifying nothing. - Macbeth, Act 5, Sc. 5

 

So, the latest desperate attempt by the anti-Obama forces focuses its depleting energy on....Hillary Clinton:

If President-elect Barack Obama nominates Hillary Clinton to be secretary of state, many legal scholars believe it would be the former law professor's first violation of the Constitution as president.

Why? Because the Constitution forbids the appointment of members of Congress to administration jobs if the salary of the job they'd take was raised while they were in Congress. (Article I, Section 6: "No Senator or Representative shall, during the Time for which he was elected, be appointed to any civil office ... the Emoluments whereof shall have been encreased during such time."  Emoluments meaning salaries and benefits.)

True enough, the language is clear. And yet, this is one of those clauses of the Constitution that seems quaint, antiquated, and woefully out of touch like, say, the Second Amendment. Indeed, as Pete Williams points out, this clause has been violated repeatedly over the past century. William Howard Taft named Sen. Philander Knox, Nixon named Sen. William Saxbe, Carter named Sen. Edmund Muskie, and Clinton named Sen. Lloyd Bentsen.

 

The solution was to roll back the pay hikes in order to fulfill the spirit of the clause.

 

Now, we're not talking about a massive raise here. It was a cost of living adjustment and one could make the case that, indeed, emoluments were not raised at all, merely restored to their 1990s level. However, a case could be made that any Senator who sat in this past Congress would forever be barred from serving as Secretary of State or any other Cabinet post.

 

It seems pretty clear this clause was designed to prevent a quid pro quo situation.

 

But, noooooooooooooooooooooo, that's not how the insane wing of America wants to play this! An example:

"Is Hillary Clinton Unconstitutional?" In a word, Yes -- or, to be more precise, a Secretary of State Hillary Clinton would be unconstitutional.

Torture? Constitutional.

 

Patriot Act? Constitutional.

 

Abandoning habeas corpus? Constitutional (until the SCOTUS overrules it).

 

A Senator taking a personal paycut (given that Hillary would have to seriously cut back on her speaking commitments and Bill would have to stop advising foreign governments)? UNconstitutional.

 

Idiots.

Feeding The Hydra

In mythology, of course, the Hydra of Lerna was a many-headed beast who devoured cattle and killed men with its poison breath. If one lopped off one of its head, two grew back in its place. It took Hercules and his cousin to kill the monster.

 

In politics, the Hydra is comprised of that faction of Progressive Blogtopia (© Skippy The Bush Kangaroo) that simply cannot stand the Clintons.

 

Exhibit A is presented courtesy of Taylor Marsh. This particular head's name? Arianna Huffington:

But given the palace intrigue that always accompanies the Clintons, James may be too genteel. Consider: in the two Times stories examining the "Clinton-Obama détente," we hear from "confidants of Mrs. Clinton," "former Clinton administration officials...who admire Mrs. Clinton," "a longtime friend," "a former aide," "two advisors to Mrs. Clinton," "a longtime friend of the Clintons who broke with them," "one Clinton advisor," "lawyers on both sides," "people close to the vetting," "close aides to Mrs. Clinton," "her confidants, who insisted on anonymity," "a close associate of Mrs. Clinton," and "one Democrat who is close to both Mr. Obama and Mrs. Clinton."

So by taking in Hillary, Obama is getting more than just Hillary -- and more than just Hillary and Bill -- he's getting the entire Royal Court of the House of Clinton, complete with chancellors, chamberlains, and a court-jester or two.

The "royal court" construct is particularly juice coming from a woman of means whose political career began and ended by being the "beard" of a Republican senatorial candidate. Presumably, this gives her a certain leg up in experiencing the royal court, but a careful analysis of her history suggests she has deep and mixed feelings about the Clintons, despite her conversion to progressivism.

 

In short, she hates Bill and Hillary, but she's worked hard to supress those feelings.

 

Unfortunately, as Marsh points out, Arianna can't hide them completely.

There is no evidence, you know, the kind that comes with an actual name, to prove Hillary Clinton and her closest circle, which at this point is rather small, has added to the drama the media covering her has spun out of control.

It's not surprising that people are buying into the soap opera construct. It's just disappointing when there's no proof that any of this is coming from HRC's side or Obama's either.

There is no doubt that the most qualified person who ran for President in 2008 was Hillary Clinton. Who has been closer to the Oval Office than a First Lady? Who has seen first hand the inner workings of policy?

 

Did the Clinton's establish a court? Of course they did. Will Obama establish a court? Of course he will.

 

But, as Peter Beinart (via Marsh) points out, this is a good thing, to mix a little of the Clintons into the Obamas:

For the first time in four decades, a Democratic administration is going to hit the ground running rather than fall on its face because it will be staffed by people who know how the federal government works. That's change all right—the kind we can believe in.

Moreover, as Time Magazine notes, Obama doesn't have much time to get on-the-job training:

But not since Franklin D. Roosevelt took office in the midst of the Depression has a new President faced a set of challenges quite as formidable as those that await Obama. That's why Obama has been quicker off the blocks in setting up his government than any of his recent predecessors were, particularly Bill Clinton, who did not announce a single major appointment until mid-December. As the President-elect put it in his first radio address, "We don't have a moment to lose."

So it's not only that he's availing himself of a fairly professional, talented crew of people who are experienced in precisely how to run a White House, he's also not got the luxury of vetting a million people who might be equally qualified, who might benearly as adept, but who might run into trouble in the confirmation process.

 

You may not realize it, but there are 300 posts in the White House that must be confirmed by the Senate. Granted, Obama has a friendly Senate awaiting him in January, but the confirmation process demands bipartisan participation (amen to that) which means Republicans will be lying in wait for anything, and I do mean anything, they can take a pound of flesh from Obama's hide.

 

Remember the Clinton Attorney General appointment? It was nearly "three strikes and you're out," what with Zoe Baird and Kimba Wood. Could you imagine the uproar if Obama gets hit on such a vital appointment, twice?

 

The Bush administration touted that "the adults are taking over," even if they quickly whined about missing W keys on the computers (which should have been our first clue). Obama does not intend to make that mistake again. It's nice to see the adults truly are  taking over. Hopefully, Obama can kill the Hydra as well. Or at least make it grow the hell up.

An Interesting Test

It should be interesting to see the market reactions today to this:

An economic stimulus package that President-elect Barack Obama is expected to announce Monday will not likely have a major impact on manufacturing until the end of 2009 or later, an analyst said Monday.

Obama is rolling out a plan that will require congressional cooperation even before he is inaugurated Jan. 20. His plan is likely to exceed the $175 billion he proposed during the campaign and would include an infusion of money for infrastructure projects, new environmental technologies and tax cuts for low- and middle-income taxpayers. It will not call for tax hikes for the wealthy.

Analyst Ann Duignan of JPMorgan said in a note to investors that machinery companies such as Caterpillar Inc., CNH Global, Deere & Co. and other manufacturers would not begin to feel an impact from federal spending until 2010.

(emphasis added)

 

Given that the market has basically spit up the Bush recovery scheme like a cat with a poisoned furball, Obama's plan should see some welcome positive reaction in the market place. Which I'm sort of hoping for because I started buying stock again on Friday. It will be hard to segregate the reaction to Obama's plan from the reaction to the Citigroup bailout, but my suspicion is stocks will reach pretty high, other things being equal.

 

Curious thing about Citigroup: they are the largest bank in the United States (at least, they were before all this merging started in the wake of the Bear Stearns debacle), and had just received a $6 billion capital infusion from the House of Saud, and, indirectly, the bin Laden family. They seemed poised for a commanding position in the banking community.

 

And now we're finding out they were already $300 billion in the tank in subprime mortgages alone, which we have agreed to guaranty.

 

Looking back now, the market mechanisms made this situation nearly unavoidable: subprime mortgages were making money hand over fist, and the repackaging of mortgages into derivative securities (sorry for the jargon, folks) made it a double-dip scoop of ice cream on top of the slice of pie.

 

The first Ponzis in were earning money hand over fist each quarter: Countrywide, Ditech, all those guys who advertised relentlessly on the TV, were making earnings that dazzled even the most suspicious bankers, who are generally thought to be sober fellows. Realistic bankers who wanted to sit on the sidelines, and make money the old fashioned way (ripping off widows and orphans), felt enormous pressure from the shareholders and market analysts to jump in with both feet into what was clearly a lucrative business.

 

It became a self-feeding cycle: banks would lend money, people would mortgage their homes, banks would then scrape for even more money to lend to borrowers who were slightly less credit worthy and the erosion of the credit markets began. This was all fine so long as the historical axiom that housing prices always rose, long term, was in effect.

 

Here's the problem: the way loans were structured, it was in the homeowner's best interest to move every five years or so. The mortgage models were based on thirty year ownership. Over the long term, yes, homes were a really good investment. But not so much in the short term.

 

You'd borrow on an adjustable rate mortgage with a teaser intro rate AND interest-only payments for the first five years. Before the end of five years, you'd sell this home, buy a new one on a brand spanking new five year adjustable mortgage with a teaser rate and interest-only payments and use the proceeds to pay off your old mortgage.

 

Once housing prices peaked and began to slide, now people were being asked to pony up significant amounts of principal to pay off the shortfall in the sales proceeds, thus taking dramatic amounts of money out of both the mortgage market as well as the consumer market.

 

Citibank is heavily involved in both markets. I suppose $6 billion was just a bandaid on an amputation.

Johnny, We Hardly Knew Ye

Imagine for a moment, a five year old boy. He is terribly skinny, has blonde hair cut short. He is in his first grade class. His teacher, Miss McCaffery, is a tall, willowy woman, fragile to even look at.

The class has just returned from lunch and is beginning preparation for art class. The ceilings are high in his room, which is in a schoolbuilding built just about thirty years earlier, in a time when education was considered holy, and schools looked like cathedrals. A place of training for a world about to change dramatically.

The boy puts on his apron, carefully tying the laces behind him since he still really hasn't mastered shoelaces even. The apron is blue, flecked with dots of tempra paints, the paint of choice for schools worldwide. One by one, in rows, the class is called to the back of the room to get a tray of paints and paintbrushes.

In another universe, on another earth, the boy will paint a masterpiece that will begin a long career in art.

In this universe, the PA system clicks on as the boy returns to his desk along the aisle by the coat rack.

"Teachers, students...we've just learned that President John Kennedy has been shot today in Dallas. We have called your parents and are making arrangements to have them come pick you up, boys and girls. For those who's parents we cannot reach, we will remain open until 3."

The benumbed boy, the budding artist, drops his tray. His masterpiece lies on the floor in its component splatters.

Next, the principal places the mic near the radio (or TV) to broadcast Walter Cronkite's voice to the school, describing what is happening.

The rest of the afternoon is a blur. He remembers finding his sister in the schoolyard. They come together and she hugs him, even if he is too young to fully comprehend what is happening. He remembers walking home past Sloan's Supermarket, his mom holding his hand for the first time since his daily trips to the skating rink in kindergarten. His sister's sobs still ring in his ears to this day. She never cried!

He spent that weekend and that Monday glued to the television set.

Little did I know how that event would twine and intersect my life in so many ways, but that's a different post.

I saw Oswald shot, live. But the most harrowing image of the weekend for me was the symbolic horse, Black Jack, the soldier's boots placed backwards in the stirrups.

Black Jack represented the fallen commander. There was a moment in the funeral procession when Black Jack bridled and in that moment, an electric horse could summon the feelings of a nation. His reluctance to move forward with the procession echoed our own disbelief that someone so young and vital could be cut down so summarily.

It was then, that moment, that I truly began to understand what was happening. And it terrified me.

Nobody Asked Me, But...

1) I've followed hockey most of my life. I like to think of myself as fairly knowledgable about both the sport and the business. I can name the backup goaltender for the Calgary Flames (McElhinney), and I try to keep up with trends in hockey. I never, ever, got wind of the fact that Hockey Night In Canada has a simulcast in Punjabi.

2) Of course, I wish Michael Mukasey all the best, even if he's one of them.

3) Al Franken seems to be closing on Norm Coleman in the Minnesota Senate race, but I suspect this one lands in the courts before Franken takes a seat.

4) Ladies and gentlemen, I give you The Bush Legacy.

BONUS SCHADENFREUDE:

5) Y'know, I'd be all for letting the automakers fail, but for the fact that one of the few remaining viable unions is the UAW, and the thing we need more of, not fewer, is unions. A bankruptcy would void the latest contract and allow the automakers to walk away from pension and health care obligations. People worked their entire lives for the promise of a comfortable and healthy retirement.

6) Remember how the right wing went nuts when a few intrepid folks investigated Joe The Plumber? Wonder how loud they'll be this time...

7) How sad is the state of health care in America when this is legitimized? Nothing against either India or its doctors, but come on!

8) I have to wonder about how panicked people are when Citibank, who hasn't asked for a dime of bailout money...yet...and has deep pocketed investors in Saudi Arabia has to sink to this level to raise its stock price.

9) Oh Canada!?!?!?!?! Sorry, I disagree with this. Take two, buy two, and maybe the national insurance should pick up the second one if it's disability-related.

10) Where there's ice, there's water, and where there's water, there's life.

11) NOTE: NOT for the faint of heart. Ignore Palin. Watch the background about a minute in:

Clowns To The Left Of Me, Jokers To The Right

I've been noticing a disturbing trend arising on the left, practically ever since Barack Obama received the nomination of the Democratic party:

Antiwar groups and other liberal activists are increasingly concerned at signs that Barack Obama's national security team will be dominated by appointees who favored the Iraq invasion and hold hawkish views on other important foreign policy issues.

The activists are uneasy not only about signs that both Sen. Hillary Rodham Clinton (D-N.Y.) and Defense Secretary Robert M. Gates could be in the Obama Cabinet, but at reports suggesting that several other short-list candidates for top security posts backed the decision to go to war.

"Obama ran his campaign around the idea the war was not legitimate, but it sends a very different message when you bring in people who supported the war from the beginning," said Kelly Dougherty, executive director of the 54-chapter Iraq Veterans Against the War.

To quote Captain Jack Sparrow when accused of cheating, "Pirate."

"Politician."

What makes this whinging particularly annoying are a few facts:

1) No one is really giving a good goddamn about the war anymore. It has become so little of an issue that the right wing warhawks, the guys who really want this war, are unilaterally declaring it is over.

Not that it matters much, of course, what a bunch of Cheeto-stained cowards who couldn't get up off their asses and pick up a gun and fight say, but the sentiment is appreciated by those of us who thought long ago the invasion was a horrible idea.

2) It's the economy, stupid.

And I'm not talking about just the stock market tanking or the housing meltdown or the impending depression that's sitting on top of Christmas like a fat bully.

Barack Obama sees what I see, and let me tell you, it's terrifying me.

I see 600 million angry young single Chinese men who don't have brides because of China's ill-conceived (pun intended) population control policies. I see 600 million angry young single Chinese men out of work for long stretches of time.

I see a half-billion starving people on the subcontinent of India and Pakistan, ripe fodder for Al Qaeda.

I see hundreds of millions of starving and angry Africans.

I see interest rates in Argentina of 30-50%.

In short, I see a lot of suffering and a lot of anger. Even change we can believe in only goes so far.

I'm not suggesting. I'm not hinting. I won't be as coy with this as I was with my stagflation predictions: we will be at war within the decade. History insists, and we are doomed to fail if we do not take this lesson to heart.

And since Barack Obama stands a very good chance of being President when that occurs, he needs to have a check on his ego around. He needs people around who are going to stand up and give him prudent counsel when war-like situations arise and help him determine which fights are worth going after and which we can avoid.

No one wants war, except a true warmonger. To call Hillary Clinton or Bob Gates, who has been surprisingly vocal in his assessments of the mess in Iraq, "warmongers" is hardly fair or accurate.

This is the hand we are dealt. The only alternative is to fold, and if we fold on this issue, Democrats may as well fold on everything else, because Republicans will run the show for millennia.

Remembrances

This weekend will be filled with memories and rememberances, and it all started this morning.

New York City's Triborough Bridge will officially be renamed the Robert F. Kennedy Bridge in a dedication ceremony Wednesday.

 

The New York senator was assassinated in 1968 while campaigning for the Democratic presidential nomination.

 

Speakers at the morning ceremony are expected to include former President Bill Clinton, Governor David Paterson and Mayor Michael Bloomberg. Kennedy's widow, Ethel, is also expected to attend.

 

The bridge will be the first major public work dedicated to Robert Kennedy in the state he represented from 1965-1968 in the U.S. Senate.

 

The ceremony is being held a day before what would have been Robert Kennedy's 83rd birthday.

 I was a bit too young to really have known the John Kennedy era, apart from sensing the excitement of people around me that this young vital war hero was our President and that things were about to change.

 

Who could have known?

 

When Robert Kennedy ran in 1968, I was a bit more aware of the world around me, being the bright little boy that I was. I knew that LBJ, as courageous a man as ever sat in the White House for what he did when he saw the world around him treating human beings like second class citizens, had serious problems in this war he had entangled the nation in.

 

RFK seemed to be the embodiment of everything his brother's legacy would destine him to be: young, powerful, opinionated, intelligent, and dedicated to making the world a better place. His signature quotation, taken from George Bernard Shaw was, "There are those that look at things the way they are, and ask why? I dream of things that never were, and ask why not?"

 

It is RFK that I have to thank for being as world-aware and as politically-motivated as I am. If all he had done for me was to spark my intellectual curiousity and gotten a ten year old to go out and campaign for the Democratic ticket that year, it would have been enough.

 

My family owes a far greater debt to Robert Kennedy, one that he earned posthumously. You see, in his family's spirit of giving back to the community, a family affected by the tragedy of what was then called "mental retardation," RFK's legacy was to help those in need get a leg up in life.

 

His foundation helped my brother, handicapped by a bout of meningitis in his early childhood, find a job, a job he has kept these thirty-odd years and will retire from shortly.

 

I often think of that day that my mother got the call from his employer, offering the job. I think of it particularly when I engage some conservative about welfare or some right-winger about personal responsibility. I think of the alternative, of how my brother could easily have sat around the house collecting Social Security for the rest of his life, a burden to society and to my family.

 

Instead, RFK in his wisdom found a way to reach beyond his years to present an opportunity to him. RFK would have done the same in his public life had he lived, I have no doubt.

 

And I have no doubt that happy moment has shaped how I perceive the world and what society owes to the least among us: a chance. As a progressive, I want all people to have that chance to grow and be something, to do something, to have something.

 

I don't mouth platitudes of "ownership society" and then ram a mortgage down someone's throat like it was a gift. Instead, I see government's role as one that seeks opportunities and seeks people in need and marries them to each other. If that means that government has to take responsibility until that opportunity presents itself, so be it.

 

It's the Christian thing to do.

 

It has been said of RFK, "Bobby, we hardly knew ye," and that is true, but for what little knowing we've had, we are a better people.

Goldberrrrrrrrrrrrrrrrrrrrrrg!

No, not the cute-as-a-button goaltender from the Mighty Ducks movies or the ultraboring automatonic wrestler of the mid-90s, but the effluent afterbirth discharge from the thighs of Lucianne "Linda Tripp's Lover" Goldberg.

 

I speak, of course, about Fudgie the Whale, Jonah Goldberg.

 

In today's episode of the Adventures of Goldberrrrrrrrrrrg, we find wrong-thinking Jonah turning history on its neck again:

On Sunday night, President-elect Barack Obama told CBS' "60 Minutes" that Franklin D. Roosevelt would be a model of sorts for him. "What you see in FDR that I hope my team can emulate is not always getting it right, but projecting a sense of confidence, and a willingness to try things. And experiment in order to get people working again."

 

This is a problematic standard. What do you want in a surgeon? One who "gets it right" or who projects "a sense of confidence?" Ditto accountants, defense lawyers, mechanics and bomb-disposal technicians: Cocky and self-assured, or gets it right?

 

Uh, hm, Jonah? FDR got it right: "We have nothing to fear but fear itself," AND fixing the damned planet! That's not a bad model to emulate ahead of what is likely to be an even worse depression than that great one that FDR fixed-- with the help of a world war, of course, an action we hope Obama can avoid.

 

What should have been looked at with a wary eye as a game run by men with a "sense of confidence" (emphasis on the "con") were the Reagan and Bush tax cuts. Indeed, the so-called and appropriately named "Laffer Curve" was a load of bollocks that its main salesman, David Stockman, later disavowed as having little relation to reality.

 

In point of fact, Bush's triple-whammy tax cuts in 2001 through 2003 took that long to show even the slightest upward tick in gross domestic product. Worse, wages and wealth declined during the first Bush administration and only in 2005 did they return to levels seen in the late 1990s.

 

You know, under that real economist, Bill Clinton.

 

Growth during the Bush administration...well, it would be polite to call it "anemic," and "pathetic" would be more accurate.

  

Which leads one to suspect that, in point of fact, if there is any validity to the Laffer Curve, it's likely that tax rates are TOO low now. Empirical evidence suggests that the Reagan and Bush tax cuts together created more harm to the economic stability of the nation, and to the long-term economic prospects of its citizenry, than the Clinton tax hike.

 

Presumably, a restoration by Barack Obama of the Clintonian level of tax rates could restore some of the balance in the economy. Even Stockman, back in 1981, pointed out that it is the imbalances between spending and receipts that wreaked all sorts of havoc in the 1980s and the same Republican greed in the 2000s has us on the brink of the greatest economic emergency in world history, worse even than the Black Death or Great Depression combined.

 

Period.

 

By raising tax rates (and possibly sacrificing some easy money on the part of the uberwealthy, but hey, Lucianne can afford a couple fewer virgins to suck the blood of), Obama restores at least a little bit of the "pay as you go" philosophy that a nation should and must operate on. For too long, the rich among us have treated the US Treasury as a credit card that our kids will pay off, but nature has a funny habit of balancing the books at inconvenient times, like now.

 

Argue if you must about the current administration's Keystone Kops attitude towards the sudden Congressional generosity, fostered in the spirit of trying to save a few homes. That's a fair debate to have, that Paulson should stick to his lasts, or he shouldn't, but he should make a decision.

 

But don't try to preempt an Obama administration plan to, once again, as FDR did, as JFK did, as William Jefferson Clinton did and as Barack Hussein Obama must, clean up after a Republican abortion of an economic program.

Hill's To Climb

The scuttlebutt over the weekend was that Hilalry Clinton has been offered and accepted the nomination for Secretary of State:

If President-elect Barack Obama selects Hillary Clinton as his secretary of state, she will oversee many of the U.S. government's foreign aid programs, potentially turning the couple into an overwhelming force in global aid, say some leaders in the philanthropic community.

"It boosts her stature, it boosts the work of the Clinton Global Initiative, it boosts the whole concept of American partnerships making a real difference on the global level," said Steve Gunderson, president of the Council on Foundations and a former Republican congressman.

[...]The choice of Clinton would present other potential problems for Obama. He would be investing his fortunes not only with his former rival for the presidency but also in an outsize figure on the global scene who has been conducting a kind of privately financed foreign policy all his own since leaving office. Obama and the former president have also continued to share a somewhat strained relationship since the end of the Democratic nominating contest.

The vetting has apparently begun with a request for the Clintons' financial disclosure for the past five years.

 

It's an interesting strategy for reasons that the WaPo only began to scratch into. Yes, the Clinton name carries enormous weight overseas, possibly more weight than a President-elect or even first term President Obama could carry. And Bill Clinton, "Greatest. President. Ever." is a larger-than-life figure, especially in the wake of the small-minded petty tinplated dictator with delusions of grandeur currently occupying the Oval Office.

 

This is both a boon and a detriment to Obama's foreign policy, unless Obama has de facto decided that Clinton's course was the best of his choices, as spare as those choices must be. Indeed, that the other name bandied about seriously on the short list was Bill Richardson seems to indicate Obama's mindset is to turn the clock back nine years on foreign policy.

 

Amen, this blogger says. And it would shut Bill up for the next eight years, even tho he had been reluctant to criticize the Bush policies out of an old boy's network sense.

 

But there are political advantages to Obama's choice of Hillary. For one thing, should things go poorly in the first Obama administration, it would be a little hard for her to run in a challenge in 2012, a la Ted Kennedy in 1980, thus weakening an Obama re-election campaign before it ever got off the ground. She'd be part of the process that came to the decisions that Obama makes, thus negating her ability to challenge as an outsider.

 

Hillary's extensive bipartisan efforts in the Senate would also serve as a conduit for foreign policy initiatives that will be vital in an Obama administration, since this economic meltdown will undoubtedly require an international effort to solve, which means it will require diplomatic efforts to secure peace in order to implement it and that means the Senate will be involved.

 

There's a far larger, and admittedly, more disturbing political aspect to this suggestion: choosing Hillary would give Obama political cover to remain in Iraq for far longer than his sixteen month time frame. I'm not suggesting that he will do that, but merely pointing out that if the situation is more dire than he had suggested during the campaign (or if the current uneasy peace blows up in his face), having Hillary around as a "I told you so" outlet would give him a forecful and credible voice to hang a hat on. Obama would avoid some of the mud thrown at him for sticking it out.

 

Stick around, this could be an interesting winter.

*AHEM*

Nominations begin November 3rd.

I don't expect to win, but I wouldn't mind making it to the finals to defend my title. Please click the link below and nominate me and then go check out the other categories and see who you can name.

Suggested nominating categories:

- Best Blog
- Best Political Blog
- Best Liberal Blog
- Best Blog 5000-7501 (no, I haven't grown much in the past year).

Oh, and I'd consider it a personal favor if you named Miss Cellania in the humour and best blog categories.

Nobody Asked Me, But...

1) Someone explain to me why this mother is on TV, instead of in jail for child neglect? 

 

2) We call this "beating a dead President to death." Oswald. Gun. Window. Nuff said.

 

3) Remind me, who was mayor of Wasilla, Alaska, again?

 

4) NEWSFLASH: Conservative talk radio exploits fear. And terror. No wait, they're THREE chief weapons are...

 

5) Want to visit anciet Rome? Google it.

 

6) I may have to start attending church again.

 

7) This week's episode of Rednecks Gone Wild!

 

8) Why is Bush holding this summit? I mean, the summit needs to be held, but why can't the President be there instead?

 

9) Ground control to Major Dick.

 

10) Man kills wife...from beyond the grave!

 

11) How big is the shitpile? This big.

So How Bad Will It Get?

This item caught my attention this morning and made me do a little thinking:

The Chancellor [Alistair Darling, Britain's Chancellor of the Exchequer] signalled that Britain will suffer a short, sharp recession, claiming that it would bounce back into growth in 2010.

OK, make the jokes now. I'll wait....

 

I've been asked a lot lately what would I do with spare cash I might have lying around or investments I might want to swap out of stocks. Needless to say, none of this should be construed as professional investment advice, as your mileage may vary and your levels of acceptable risk may differ from mine.

 

For now, I tell friends, if you have time, then buy a CD. Don't even think about putting your money in anything until one of two things happens:

1.  The market bottoms out.
2.  January 21, 2009.

I believe the market bottom is approaching. My personal target is somewhere between 7,500 and 7,000. That's when I will begin buying stocks again, broad-based recession resistant stocks, like say food or healthcare, and probably index fund shares. I think it will bottom out next month.

 

OK, moving on, back to the article. I agree with Chancellor Darling and disagree. I believe things will be very tough into next year, and possibly beyond, but that by 2010, things will begin an uptick.

 

The nature of that uptick is in doubt, however, and here is where the chancellor and I disagree. Well, likely. Keep in mind that he is forced to operate in an environment that I am not. He speaks for a government, and has to base his statements on the available evidence. I'm free to make allowances that things will be different.

 

For example, I'm convinced that some form of stagflation will occur: stagflation is a moment in time when prices go up, but GDP fizzles for whatever reason.

 

We suffered stagflation in the late 70s because of the oil crunches. There, OPEC kept the screws on oil supply tightly, thus draining our economy of money. This meant that inflation went through the roof, but also, there was less money available here to lend which forced interest rates higher, which meant little economic activity for the increase in prices.

 

The question becomes, how bad will it be? New York City will be ground zero for the Bush Depression. That's two calamities he's been directly responsible for in eight years. You begin to think he doesn't like us very much.

 

Yesterday, in New York City, Monster.com held a job fair. On a Wednesday in the middle of the day, two thousand lined up to interview with two dozen companies. Each had an average of two jobs available. Most had only one. You have better odds reading the want ads.

 

The New Jersey Nets are offering free tickets to the unemployed. Just send in your resume. Maybe you'll get a job.

 

Landmark restaurants, open for decades, close without warning in Harlem.

 

And as I mentioned yesterday, the state and city have both announced harsh cutbacks in services in anticipation of the twin blows of a busted stock market and bonuses being withheld for brokers and other securities company employees.

 

As New York City goes, in this crisis, so goes the nation, since this crisis is based in the very industry that makes New York the money capital of the country, if not the world. The ripples will spread far and wide, up and down the coasts and eventually into the heartland.

 

And even into other nations that depends on us.

 

It will be harsh, make no mistake about it. And with the current administration diddling their dicks over how best to bail us out in the short time left to them (miracles do happen, but I won't hold my breath), it will clearly be left to the Obama administration to clean things up. They can stop the bleeding.

 

My worry is, that may be the easy part.