The auto bailout failed cloture in the Senate last night, 52-35. The Dems needed four votes to pass this thing.
The tally is here. They got 10 Republicans, which should put them at 61. Three Dems (Baucus, Lincoln, Tester) voted no. They lost a vote when the junior Senator from Illinois resigned in anticipation of his next office. (Wasn't that a little earlier than strictly necessary? Are we sure that gentleman a far-sighted genius strategist, as widely advertised and agreed?) Kennedy might be too sick to vote, but the Senate has all sorts of collegial gimmicks (vote pairing, etc) for such things (and that's not a bad thing).
I'm surprised the Republicans had the nerve to stop this, and the skill to make UAW intransigence the morning headline. Well played, Senator Corker, Senator McConnell, Senator Shelby.
Plan B is an Administration drawdown on the TARP.
Plan C? The Dems claim there is none, outside bankruptcy. But I think the next Congress is seated on 4 January, before the Inauguration. (It was in 2005.) That Congress will seat 7 additional Senators, and would be able to pass this same legislation that very day. Are we to understand that GM can't get its suppliers and creditors to stretch them three weeks? I'm sure the Congressional Democrats don't want to start the next Congress by bailing a core constituency, but I don't see why the President should concern himself with that.
Friday, December 12, 2008
Tuesday, November 11, 2008
Congratulations
I stopped posting because there just wasn't much left to say leading up to the election. Toward the end I saw a glimmer of hope for McCain's campaign, but didn't imagine it more than putting the best face on things. Those hopes proved illusory.
Congratulations to the Obama supporters, who certainly worked hard for this. The election of a black man to the American presidency is a great human moment, an enormous testament to the power of free people to correct the errors of their history.
I hope that all my concerns about an Obama presidency prove false. God bless Barack Obama, President-elect of the United States of America.
Congratulations to the Obama supporters, who certainly worked hard for this. The election of a black man to the American presidency is a great human moment, an enormous testament to the power of free people to correct the errors of their history.
I hope that all my concerns about an Obama presidency prove false. God bless Barack Obama, President-elect of the United States of America.
Wednesday, October 22, 2008
The Grade on JFK's Testing
"It will not be six months before the world tests Barack Obama like they did John Kennedy. The world is looking. We're about to elect a brilliant 47-year-old senator president of the United States of America. Remember I said it standing here if you don't remember anything else I said. Watch, we're gonna have an international crisis, a generated crisis, to test the mettle of this guy."
-- Joe Biden in Seattle, Washington, on Sunday 10/19/2008
The Bay of Pigs crisis was not "generated" by some outside actor. It was an American initiative, an "invasion" of Cuba by Cuban partisans recruited, trained and funded by the CIA. The project was doomed in concept, poorly planned and executed, and belatedly undercut by JFK's cancellation of the American air support promised in the original plan.
The effort was launched under Kennedy's go-ahead. He lacked the experience to properly review the plan, and the confidence to overrule the career national security experts who recommended it.
JFK did better as he went on. His Berlin speech is famous, and the Cuban Missile Crisis is regarded as a triumph. But careful analysis of the missile crisis suggests that the rewards weren't worth the risks, and that our success was due in part to luck and Russian prudence. In Viet Nam his policy was a muddle of contradictory goals and beliefs that the stage for a disaster.
This mixed record came at a moment of national consensus on the strategy and tactics of containing Soviet Russia. Kennedy was largely an implementer of a Cold War architecture established by a bipartisan collection of "wise men" led by Truman and Eisenhower. We don't currently have such a consensus response to Islamist terror, and the development of that consensus is among our chief foreign policy problems.
Biden invokes Kennedy to suggest that Obama's brilliance will provide foreign policy successes similar to Kennedy's. We ought to consider whether it will provide similar risks, and ask how lucky we're feeling.
-- Joe Biden in Seattle, Washington, on Sunday 10/19/2008
The Bay of Pigs crisis was not "generated" by some outside actor. It was an American initiative, an "invasion" of Cuba by Cuban partisans recruited, trained and funded by the CIA. The project was doomed in concept, poorly planned and executed, and belatedly undercut by JFK's cancellation of the American air support promised in the original plan.
The effort was launched under Kennedy's go-ahead. He lacked the experience to properly review the plan, and the confidence to overrule the career national security experts who recommended it.
JFK did better as he went on. His Berlin speech is famous, and the Cuban Missile Crisis is regarded as a triumph. But careful analysis of the missile crisis suggests that the rewards weren't worth the risks, and that our success was due in part to luck and Russian prudence. In Viet Nam his policy was a muddle of contradictory goals and beliefs that the stage for a disaster.
This mixed record came at a moment of national consensus on the strategy and tactics of containing Soviet Russia. Kennedy was largely an implementer of a Cold War architecture established by a bipartisan collection of "wise men" led by Truman and Eisenhower. We don't currently have such a consensus response to Islamist terror, and the development of that consensus is among our chief foreign policy problems.
Biden invokes Kennedy to suggest that Obama's brilliance will provide foreign policy successes similar to Kennedy's. We ought to consider whether it will provide similar risks, and ask how lucky we're feeling.
Wednesday, October 15, 2008
No Galt
Dr. Helen wonders if we should go Galt. I left the following monster comment, because I'm a hack without manners or style:
The coming government will be more "progressive" than its citizens.
-- The left-liberals took over the Democratic party.
-- The Democrats are winning because the Republicans were unprincipled spenders who ignored their duties.
-- Even the good ones hardly understand their principles -- if McCain will pay off overextended borrowers, well, the improvement over Obama is marginal at best.
-- The press don't understand either, and look for conventional wisdom that can be safely repeated.
And still McCain was winning on character before the bailout demonstrated executive and legislative incompetence. We might know the Democrats can be worse, but the less alert probably find it hard to imagine.
A Galt Strike attacks a _society_ that insists on taking. Ours is a free working society inherited from immigrants, whose government is momentarily seized by political entrepreneurs. The solution is to take back those institutions, starting with a Republican party. The electorate will choose self-reliance and freedom, but it has to be offered truly and fairly.
And a Galt Strike imagines that a reasonable government emerges naturally, as people learn their lesson. It won't. Abuse of power is the most natural human instinct. _Every_ democracy is vulnerable to politicians adapting moral arguments to justify expansion of their powers. The true principles of the civil rights movement are as subject to political misappropriation as the medieval Church.
A free society requires constant resistance against status accumulation by political entrepreneurs, and vigilance against their innovations. And yet government must still adapt to real changes in technology, demographics and trade, and society must still reject any real errors conserved in its institutions. Government isn't easy, and while its principles maybe "natural", their actual enactment isn't.
It's not enough for the Galts to produce economically. They have to produce politically, too.
The coming government will be more "progressive" than its citizens.
-- The left-liberals took over the Democratic party.
-- The Democrats are winning because the Republicans were unprincipled spenders who ignored their duties.
-- Even the good ones hardly understand their principles -- if McCain will pay off overextended borrowers, well, the improvement over Obama is marginal at best.
-- The press don't understand either, and look for conventional wisdom that can be safely repeated.
And still McCain was winning on character before the bailout demonstrated executive and legislative incompetence. We might know the Democrats can be worse, but the less alert probably find it hard to imagine.
A Galt Strike attacks a _society_ that insists on taking. Ours is a free working society inherited from immigrants, whose government is momentarily seized by political entrepreneurs. The solution is to take back those institutions, starting with a Republican party. The electorate will choose self-reliance and freedom, but it has to be offered truly and fairly.
And a Galt Strike imagines that a reasonable government emerges naturally, as people learn their lesson. It won't. Abuse of power is the most natural human instinct. _Every_ democracy is vulnerable to politicians adapting moral arguments to justify expansion of their powers. The true principles of the civil rights movement are as subject to political misappropriation as the medieval Church.
A free society requires constant resistance against status accumulation by political entrepreneurs, and vigilance against their innovations. And yet government must still adapt to real changes in technology, demographics and trade, and society must still reject any real errors conserved in its institutions. Government isn't easy, and while its principles maybe "natural", their actual enactment isn't.
It's not enough for the Galts to produce economically. They have to produce politically, too.
Friday, October 10, 2008
Ayers, The Issue
Candidate McCain's focus on Candidate Obama and Professor Ayers is an odd thing.
It seems unlikely to affect the election, which nows seems entirely determined by reactions to the markets. McCain's understanding of the situation is better only in that he assigns important responsibility to the GSEs, worse in that he has been kind of flailing around and that his latest mortgage proposal is a flat-out bailout of reckless behavior. Neither candidate understands the banking markets, or the measures required to minimize the damage to them, or the limitations on the help such stabilization provides the larger economy. Before this, McCain could argue that Obama isn't ready for the Presidency. Now it seems that neither of them are ready to handle our financial problems -- so Obama's relative callowness is remarkably diminished. It's obvious that a Republican Administration has fumbled the past month badly, and that they are clearly associated with many of the regulatory problems leading up to this. The Democrats bear important responsibility too, but that is far less clear. So the crisis has minimized Obama's relative weaknesses, and reminded voters of Republican incompetence. They are going to their initial instinct to vote against the Republican.
So raising the Ayers relationship and the background questions is unlikely to matter much, and it is likely to agitate the political debate. On the other hand, they are legitimate questions that the press should have addressed a year ago. It hardly seems irresponsible to notice the absence of scrutiny before we elect the guy. Then again, if McCain was going to raise those issues, shouldn't have done so when there was time to discuss them? But it looked like he wouldn't need to, so why get everybody all worked up?
The background questions capsulize the larger situation: our elites have departed so far from factual, reasoned discussion, and neglected the fundamental issues so completely, that we now find ourselves without any good choices. No choice leads toward any solution. We're just wandering around here.
It seems unlikely to affect the election, which nows seems entirely determined by reactions to the markets. McCain's understanding of the situation is better only in that he assigns important responsibility to the GSEs, worse in that he has been kind of flailing around and that his latest mortgage proposal is a flat-out bailout of reckless behavior. Neither candidate understands the banking markets, or the measures required to minimize the damage to them, or the limitations on the help such stabilization provides the larger economy. Before this, McCain could argue that Obama isn't ready for the Presidency. Now it seems that neither of them are ready to handle our financial problems -- so Obama's relative callowness is remarkably diminished. It's obvious that a Republican Administration has fumbled the past month badly, and that they are clearly associated with many of the regulatory problems leading up to this. The Democrats bear important responsibility too, but that is far less clear. So the crisis has minimized Obama's relative weaknesses, and reminded voters of Republican incompetence. They are going to their initial instinct to vote against the Republican.
So raising the Ayers relationship and the background questions is unlikely to matter much, and it is likely to agitate the political debate. On the other hand, they are legitimate questions that the press should have addressed a year ago. It hardly seems irresponsible to notice the absence of scrutiny before we elect the guy. Then again, if McCain was going to raise those issues, shouldn't have done so when there was time to discuss them? But it looked like he wouldn't need to, so why get everybody all worked up?
The background questions capsulize the larger situation: our elites have departed so far from factual, reasoned discussion, and neglected the fundamental issues so completely, that we now find ourselves without any good choices. No choice leads toward any solution. We're just wandering around here.
Thursday, October 9, 2008
Meltdown
"The government would buy the existing troubled loans at face value -- absorbing the haircut itself -- and the Federal Housing Administration would issue a new, federally guaranteed 30-year fixed-rate loan, based on the property's present value, at a "manageable" interest rate, the McCain camp said."
WSJ, 10/9/2007
The idea is based on Martin Feldstein's proposal, which would lend homeowners with negative equity 20% of their principal at government rates on their personal credit. This would give them an incentive to keep the house, and reduce their interest payments, without reducing their total debt. I'm not sure it's a great idea, and I wonder how aggressively politicians would enforce those personal notes, but it doesn't give the homeowners a pass on overextending themselves.
McCain would. Homeowners here get government funded forgiveness of excess debt. I haven't seen any suggestion that the government would get a position in any capital appreciation of the house. This might reduce foreclosures and thus downward pressure on housing prices. But that pressure is only temporary anyway -- the long term value of mortgages is driven by the long-term value of the house, and that is driven by real estate economics which are temporarily distorted by the foreclosures. We don't know the "right" level for housing prices, and probably won't for a while -- if they go lower still, are we going fund a second round of principal reductions?
I can't support this. It's a huge incentive to irresponsible financial behavior, added to existing government incentives in health care and disaster relief, and sets an ominous precedent for handling coming problems with retirement savings. Even if it did help with the current situation, we still might well be better off suffering a recession than telling people the government will bail out their stupid decisions. And I certainly don't want to do this without a lot more thought McCain has given this, and a lot less suspicion of political motivation.
McCain is really reaching here. Some of this is panic, some pandering. I don't think he understands economics sufficiently to understand the moral hazard problems of this, or how they differ from those in the proposals of Feldstein and others. But whether its errors come from ignorance or ambition, I can't agree to something this bad.
WSJ, 10/9/2007
The idea is based on Martin Feldstein's proposal, which would lend homeowners with negative equity 20% of their principal at government rates on their personal credit. This would give them an incentive to keep the house, and reduce their interest payments, without reducing their total debt. I'm not sure it's a great idea, and I wonder how aggressively politicians would enforce those personal notes, but it doesn't give the homeowners a pass on overextending themselves.
McCain would. Homeowners here get government funded forgiveness of excess debt. I haven't seen any suggestion that the government would get a position in any capital appreciation of the house. This might reduce foreclosures and thus downward pressure on housing prices. But that pressure is only temporary anyway -- the long term value of mortgages is driven by the long-term value of the house, and that is driven by real estate economics which are temporarily distorted by the foreclosures. We don't know the "right" level for housing prices, and probably won't for a while -- if they go lower still, are we going fund a second round of principal reductions?
I can't support this. It's a huge incentive to irresponsible financial behavior, added to existing government incentives in health care and disaster relief, and sets an ominous precedent for handling coming problems with retirement savings. Even if it did help with the current situation, we still might well be better off suffering a recession than telling people the government will bail out their stupid decisions. And I certainly don't want to do this without a lot more thought McCain has given this, and a lot less suspicion of political motivation.
McCain is really reaching here. Some of this is panic, some pandering. I don't think he understands economics sufficiently to understand the moral hazard problems of this, or how they differ from those in the proposals of Feldstein and others. But whether its errors come from ignorance or ambition, I can't agree to something this bad.
Too Busy, Too Foolish
"But health insurance is complicated and scary; most people don't have the time or expertise necessary to make wise choices. They rely on their employers to make sure they're getting a good deal — and to fight for them if the insurance companies try to cheat them. And with many employers slouching away from that responsibility, the public seems ready to turn to the government for protection. "
-- Joe Klein, Time 10/9/2008
I can't imagine a better description of the welfare state's infantilization of the public. If people won't take responsibility for their own health, just exactly are they responsible for? A person who won't take care of themselves has no one to blame but themself when they are told what to do and what to think.
And I'd add that health care's unavoidable complications are compounded by regulatory requirements like the Mental Health Parity Act that Congress just added, in an afterthought, to the bailout bill.
And just what exactly is someone to do if the government doesn't make wise choices for them, or refuses to fight for them? What alternatives will they have, what resources can they bring to bear?
A healthy society raises people who take the time to take of themselves, and can develop the expertise they need to do so. We should help those few that could never manage for themselves (though it's necessary to add that our moral responsibility doesn't imply their political right). That's what conservatism ought to be about. It's failing because our "conservative" politicians are too interested in incumbency to take on a tough case.
And I'm afraid that McCain, with his proposal to write down overextended borrowers on the federal dime, is hardly more principled.
-- Joe Klein, Time 10/9/2008
I can't imagine a better description of the welfare state's infantilization of the public. If people won't take responsibility for their own health, just exactly are they responsible for? A person who won't take care of themselves has no one to blame but themself when they are told what to do and what to think.
And I'd add that health care's unavoidable complications are compounded by regulatory requirements like the Mental Health Parity Act that Congress just added, in an afterthought, to the bailout bill.
And just what exactly is someone to do if the government doesn't make wise choices for them, or refuses to fight for them? What alternatives will they have, what resources can they bring to bear?
A healthy society raises people who take the time to take of themselves, and can develop the expertise they need to do so. We should help those few that could never manage for themselves (though it's necessary to add that our moral responsibility doesn't imply their political right). That's what conservatism ought to be about. It's failing because our "conservative" politicians are too interested in incumbency to take on a tough case.
And I'm afraid that McCain, with his proposal to write down overextended borrowers on the federal dime, is hardly more principled.
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