Saturday, November 29, 2008

All You Need To Know Right There

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Austan Goolsbee is slated to become Barack Obama's chief of staff at the Economic Recovery Advisory Board. Mr. Goolsbee is a respected economist, but in this particular situation, may not be the best choice, considering his views on the lending practices that got us into this mess.
Thus, Goolsbee was delighted that political and regulatory tools were being used to get those uncredit worthy into new homes. The private sector was not thinking far enough ahead, and that's what the government needed to get them to do, Goolsbee said.
OK. Well, we did that. How'd that work out for us? And by "us", I mean, all of us who aren't Austan Goolsbee. for him, it appears to have worked out fine. His reward for advocating the policies that led us into this mess appears to be increased power and responsibility.

That's all you need to know about how government works right there.

Tuesday, November 25, 2008

The Shock Never Ends

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Obama Chief of Staff Hopes to Exploit the Economic Crisis to Expand the Growth of Government:

In earlier posts (e.g. - here and here) I have emphasized the risk that the combination of economic crisis and unified Democratic control of Congress and the White House would lead to a vast expansion of government. It looks like key Obama advisers and congressional Democrats are thinking along the same lines. As Obama Chief of Staff Rahm Emanuel puts it, the crisis is "an opportunity to do things you could not do before . . . You never want a serious crisis to go to waste." The WSJ article from which the quote comes makes clear that the "things" Emanuel has in mind are government policies that "pick winners" by subsidizing particular industries on a massive scale - as Congress is already doing with the finance industry, auto industry and others (HT: David Boaz).

an enormous transfer of resources from taxpayers and wealth-producing industries to interest groups with political leverage.

Monday, November 24, 2008


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The bottom line is it may take a generation to determine what sort of
failure or success there was in Iraq.

Not even.

The war was a massive net gain for the U.S.

1. We now have the first Arab democracy and the first Arab free press, which
show the rest of the region what’s possible if you’re willing to fight and
change your hidebound way of doing things.

2. The Shi’ites now govern a country, which gives hope to the oppressed
Shi’ites all over the region and therefore alleviates simmering sectarian

3. Al Qaeda is totally discredited.

4. We’ve created a de facto Sunni Arab alliance against Iran.

5. The U.S. is much more involved and influential now than it was under

6. The U.S. and its military have utterly destroyed our image in the middle
east as paper tigers that can’t take casualties.

7. The U.S. military is now the most combat-hardened force on the planet,
able to fight both conventional wars and asymmetrical wars. This experience will
sustain us for decades.


And of course since most people aren't capable of abstract thought they also don't stop to consider what the likely outcomes were if we continued to let the Oil For Food scandal destroy the sanctions regime against Iraq. There were such sunny options as another Iran-Iraq war or a WMD armed Iran-Iraq alliance against Israel among others...

A Most Unhappy Man

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I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world. No longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.
- Woodrow Wilson (shortly after signing the Federal Reserve Act into law)

All OTangled Up In Clinton

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Late in Clinton’s tenure, the White House put forth a document celebrating
“Historic Economic Growth” during the administration and pointing to the policy
accomplishments it deemed responsible for this growth. Among the achievements on
Clinton’s list were “Modernizing for the New Economy through Technology and
Consensus Deregulation.” That’s right, a Clinton White House document credited
part of the administration’s success to that now dreaded d-word,

Everything in those passages is true. All that’s missing is credit to the GOP-controlled Congress elected in 1994 for passing most of the policies that led to the prosperity. But the Clinton administration, whatever its personal and policy flaws, should indeed be praised for signing and advocating this deregulation. These bipartisan financial policies, however, were the very same policies that Obama, running mate Sen. Joe Biden (D-Del.) and other Democrats attacked during the campaign.

 blog it

Sunday, November 23, 2008

I Don't Think So

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I am convinced that someone possessing a hard science degree from Harvard or our other elite academic institution is worthy of respect. They are often the very best in the entire world. But this is not necessarily true of those who acquired a softer credential from the very same universities! These latter individuals are usually idiots. Those who are truly gifted will be the exception to the rule. This is why I ridicule the naive people who made a big deal about Barack Obama’s Harvard Law degree. Let’s not forget that it is the graduates from our so-called best universities, like Frank and Rains, who are mostly responsible for our current economic crisis. They are not only politically correct—but also lacking in wisdom and plain old common sense. By all rights, anyone who obtained a liberal arts degree form a Ivy League school should perhaps be deeply ashamed. We may even have the moral right to question their integrity. Am I exaggerating? I don’t think so.

They Were Wrong

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Subprime mortgages are a problem but they are not the cause of the collapse. The collapse was caused by an OPEC generated precipitous rise in oil prices. Subprime mortgage buyers could no longer pay their mortgages because too much of their pay check had to go to pay for gasoline. Yes, I know, gas prices have since declined but not before Humpty Dumpty, the American consumer, was broken.

All subprime loans did was to encourage poor people to join the national
spending spree.

Indeed, when Oil rich nations decided to squeeze the American consumer by not only raising oil prices but also by ending or lowering their investment in the American financial markets, they assumed that there were enough new consumers in Asia to replace the American ones. In other word, they assumed that the collapse of the US economy would not lead to the collapse of the global economy, most especially, the Asian one.

They were wrong.

Two Legs Good?

Given all that, are we now suddenly—in 1984-fashion—around late January either
to be told all that was not quite so, or will we simply hear no more about how
these Bush legacies have ruined America—or what exactly is the party line to be?
There is still such a thing, after all, as Google.

The point is that
somewhere around early to mid-2007 ABC, NBC, CBS, MSNBC, CNN, the New York
Times, the Washington Post, NPR, Newsweek, Time, etc. chose to become—in the
manner that they selected, emphasized, and presented their news stories—a
quasi-official Obama media, or at least a quasi-official
what-they-thought-Obama-was news media. Chris Matthews' asinine statement about
his investment in the success of the Obama administration was merely a crude
summation of the creed of the more sober and judicious.

I don't really
think they can now pull off an Animal-Farm-like 'two-legs were bad', 'now
two-legs good' complete turn-about just because they've taken over the manor.