Pray For Injuries

I've read some of the transcripts from last night's "debate" in Iowa.

First off, how awful are American political debates?  Are there any redeeming value to them, beyond a candidates ability to speak talking points and pander?

Second, Huntsman showed again why he's the darling of all Burkean conservatives and why he will never win the nomination.

Third, when Ron Paul is the most reasonable person on stage, you have a problem.

Fourth, Bachmann is really in it to win it.  She beat the crap out of Pawlenty, which admittedly is a "world's tallest dwarf" type of distinction.  Pawlenty really is as milquetoast as he appears to be.  Romney was mostly invisible and the major moments were Bachmann's.

Fifth, it would have been nice to see Perry in that group, just because you want to start winnowing at some point.  We all know the following candidates are toast: McCotter, Gingrich, Roemer, Santorum, Johnson and probably Huntsman and Cain.  Pawlenty is in the toaster.  Paul's acolytes will fight to the bitter end, so he can stay.

But it would be much more illuminating to see a debate between Bachmann, Romney, Paul and Perry with maybe Hunstman in there as a voice of sanity.  Right now there is no inducement to stand apart.

Good example: when asked whether they would support a deficit reduction deal that was 16 parts cuts to 1 part revenue they all declined.  Every one of them.  Let that sink in.

It would be fun to see a guy like Hunstman become the Eisenhower Republican In The Room and start talking in terms of what we once considered conservatism.  Just to "heighten the contradictions".  As it is, everyone on that stage is trying to out Teatard each other.

The only thing going for them is few people are paying attention right now.

Feel The Perry-neum!

Didja hear?  Didja hear?  ZOMG!  

So, my tout for the GOP 2012 nomination appears to be getting into the race.

Rick Perry is - by most accounts - a perfect GOP candidate.  He is impossibly rugged looking but with immaculate hair.  Seriously, that hair is something else.  He is a gun nut who goes jogging with a pistol, because...

He talked idly about secession.  He has a state so mired in red ink from cutting taxes that its schools are so far at the bottom of the barrel they are looking for a new barrel.  Oh, and he's a Christianist - though maybe less nutty than Bachmann.

If Perry succeeds in becoming the anti-Romney, and the rumored skeletons in his closet don't come out before the convention, then I think he's the nominee.  And I think - barring the unforeseen - he loses.

Note About Britain

Why have I not used Banksy images before?

I have just recently started reading BooMan Tribune.  Great stuff.  I think this is right on:
http://www.boomantribune.com/story/2011/8/10/114513/417

When FDR was President, someone asked a Socialist (Norman Thomas?) if FDR had carried the Socialist agenda.  The Socialist replied, "Yes, on a stretcher."

The New Deal and the Great Society were deals with the poor and working class to avoid their drift into Socialism.  They were a Halfway Covenant to prevent the appeal of the Radical Left.

But once those programs - the ones that provide a meager hope for a decent life - are stripped away and all you are left with is despair, poverty and the filthy rich, then you will get civil unrest.  You got it in the 1930s and 1960s.  And you will get it again.

The Right and the Rich had better be careful for what they wish for.

Close, But No Kewpie Doll

So it looks like the struggle to flip the Wisconsin Senate is over.  Barring actual malfeasance as opposed to alleged malfeasance up in Waukesha County, the Dems will come up one seat short.  They managed to flip two of the three they needed, but couldn't quite close the deal.

I imagine tomorrow this will be seen as a 66% victory, ousting GOP state senators from GOP leaning districts.  And it will be right to see it that way.

Hooray.

Of course, it's also right to see ACA, last December's budget deal and this summer's debt ceiling deal as 66% victories, too.  Democrats got a lot done, despite a hostile environment.

Except Wisconsin is an example of people power and progressive values and Obama is a sellout.

Just keep that straight when you're assessing progressive victories.

Not quite getting what we wanted in Wisconsin: Valiant effort.

Not quite getting what we wanted in Washington: Sell out.

The Wisdom Of Markets

One of the hallmarks of anti-regulatory politics is that we don't need Big Gubmint looking over our shoulder and playing nanny, because the markets will sort out things like pollution and worker safety.

I've watched the markets a bit the last week.

Can we stop pretending there is ANYTHING rational about them?

A Plausible Thought

Why has the downgrading of American debt led to a massive sell-off of stocks and a flight to....US Treasuries?

Could it be that a lot of people had shorted the market in anticipation of default and were looking to recoup their shorts?

Certainly seems possible to me.

How About Some Good News?

The guys over at Bonddad's Blog have been SPOT ON in their economic predictions this year.  They predicted slowing growth in Q1 and Q2.  They were right.  They are now predicting better growth through the rest of the year.

Austrian economics - as mentioned below - believes that everything eventually evens out, even if it's painful in the meantime.  Barring another shock - and I don't really call the market sell-off a shock - we should continued growth, because eventually things do return to normal.  Or at least get better.

The S&P thing is clearly spooking the sheep-who-think-themselves-wolves on Wall Street, but it's spooking them into buying US T-bills apparently, so who the hell knows.

This feels more like a correction to slow growth than it does the S&P downgrade.  Having said that, a lot of people are attacking S&P.  I would have preferred we did that in 2009.

Of course, I wish we'd held a lot of people accountable back in 2009.

I Got Nothing

The imminent collapse of America and the Western World notwithstanding, I don't have a lot to say today.

Except I am leaning more than ever on the Hawes Postulate: "The world is always ending."

In the 19th century we had some really nasty depressions that the government did nothing to cure until they finally ran their course.

We are all Austrians now.  Or Mayans.  We'll find out soon enough.

Downgraded

Yeah, it's not funny anymore.

So, Standard and Poors downgraded US debt.  Fitch and Moody did not.  I'm not sure what this does to long term borrowing.  No one is.

First of all, the fact that they made a $2T error in their first report, admitted it and STILL downgraded US bonds, suggests, as many have noted, that this is not about levels of US debt to GDP or our capacity to pay it off.

Rather S&P has made a statement about our political situation.  I think Daniel Gross explains it well here.

The GOP brinksmanship on the debt ceiling created an artificial crisis that had an unsatisfactory resolution.  S&P basically said, "If you can't reach a comprehensive debt agreement with default hanging over your head, then you can't reach any debt agreement."  While there was some "both sides do it", the put a lot of the onus on the faction within the US government that will neither consider new revenues nor worry about actual default.

Put another way, the GOP insistence on taking the nation's credit hostage and then failing to agree on anything real, means that our political system is broken.

Well, no kidding.

Part of the problem with all this is that because S&P made essentially a political statement, then it can be ignored, because we operate in a current culture where objective truths are denied repeatedly as being "just politics".

Another problem is that S&P hardly has covered themselves in glory the past few years.  They missed the real estate bubble and then screwed up the math on the US debt downgrade.

Ideally, worries about the US's ability to honor its debts would come from the bond market itself, not a self-anointed ratings agency, which clearly has an axe to grind.

Once again, the decision to wed the debt ceiling to debt reduction has proved disastrous for everyone involved (whether they wished to be involved in the first place or not).

The proper time and place to have the discussion on long term debt is during the budgeting process, not the debt ceiling.  But since the GOP won't actually produce a budget that has the cuts they want, we are back to hostage taking.

In short, I'd say S&P is wrong for all the right reasons.

The Tea Party, Our Galtian Overlords And The Market

Gee, I wonder if this might be a problem?

So, the Tea Party/GOP/Randian Supergeniuses have all been forcing the conversation to be about the national debt.  Why?  Because the markets demanded it!

Well, we now know that was a lot of organic, bovine-originating fertilizer.

THE problem, the single biggest problem, has always been the weak employment situation.  Demand can eventually be self-creating.  But the Obama economic team underestimated the length and depth of the recession.  I think it's true that they could have gotten no more stimulus through congress in 2009, but they could have prioritized a job program in 2010 before the election.  And they are guilty of acquiescing to the focus on debt rather than employment.

But it wasn't the Obama administration that nearly forced the country into default in order to slash spending.  It wasn't the Obama administration that spent January through June working hard to end funding for Planned Parenthood rather than create a jobs program.

Today's unemployment report was "meh" rather than "WTF!", so maybe some confidence returns to the markets.  Maybe.

Recessions caused by a financial crisis tend to be lingering and painful.  But they do end.  The painful depression under Martin Van Buren - caused by the killing of the Bank of the United States and the specie circular - lasted almost 6 years without ANY attempt at government stimulus, but it did end.  The various depressions of the Gilded Age did end eventually without government action.

This is Hayek's position, essentially.  Keynes's response is that "in the long run we're all dead" and we should work to ameliorate economic hard times.

But just as Nixon famously said, "I'm a Keynesian now" in response to his economic hard times, Washington (and by association Obama) has said, "I'm an Austrian now".

That has to change.

I see no way to actually get a jobs program through this House.  But Obama needs to start talking about a new CCC or a new WPA.  He needs to talk about directly hiring Americans to do jobs that need doing: cleaning brown sites, fixing roads and bridges, creating a modern power grid.  He needs to make the House GOP become the obstacle to this.

It worked for Harry Truman, and Obama has more latent reservoirs of goodwill and charisma than Harry Truman ever did.

Obama had the perfect temperament for 2008 - calm, measured, unifying.  Unlike Clinton he came with no personal baggage.  He was a tabula rasa.  That was the secret of his success and his curse.

He has to be more combative this time around, and it doesn't wear well on him.  Luckily, Mitt Romney is not a great standard bearer in a weak economy.  His hedge fund is a prime example of the downsize and outsource school of American economics.  And the lunatic fringe candidates of Bachmann and Perry seem doomed by their association with the Tea Party.

But Obama needs to (and I can't recall how many times I've written this) find that inner populist, that inner Harry Truman.  He needs to unleash the Krakken the whupass on the Tea Party for obstructing a jobs program.

I think one reason he hasn't is because he doesn't want to spook the markets with negative talk.

Well, the markets are spooked by the data.  He doesn't need to hold back anymore.  Say, "Things are bad, and I have a plan to put a million Americans to work in a new CCC."  And then when the GOP blocks it, they are the bad guys.

I don't understand why this is hard to see.

Our Broken System

Fantasy versus reality.

http://www.theatlantic.com/politics/archive/2011/08/on-rules-and-norms-four-reasons-to-regret-this-moment/243082/

James Fallow's article above talks about how our system is broken.  There are the rules of Congress and there are the "rules" of Congress.  For Congress to function, the "rules" are more important than the rules.

For instance, filibusters should be reserved for "big deals" not every procedural vote and nominee.  The debt limit should always be raised.  You campaign from the flanks and govern from the center.

Newt Gingrich began the process of undermining these "norms" as Fallows calls them.  It has now reached the point where minorities in the Senate and minorities of the majority in the House can effectively destroy the legislative process.

The clear solution is institutional reform.  But reforming Congress would undermine the power of those who are already powerful in Congress.  It would also create the problem of Congress actually doing things, which is a real problem in some Congresses.

Ultimately, Congress depends on men and women of goodwill, but differing opinions, coming together and compromising on policy for the good of the country.  We don't have that right now for a lot of reasons.

Remember Kerry's famous "gaffe" about how he was for the bill before he was against it?  That is perfectly legitimate considering how bills change in the process of passing them.  But it sounds terrible, and that's more important in our current politics than any accuracy that might be attendant. It is more important to be consistent than thoughtful.

There are some common sense reforms that a new (and hopefully better) Congress should look at.  Limits on filibusters of executive branch appointments and district level judgeships.  Getting rid of the debt ceiling as a requirement for congressional action. There are probably other things.

But first and foremost, you need a better class of congressmen.

Wilson and Obama

Yeah, that's Obama on the right.  I said it.

I'm a third of the way through John Milton Cooper's hefty biography of Woodrow Wilson, and the jacket cover talks a bit about how Obama - as a "professorial" type of politician - might learn some things from Wilson.

So far, the similarities are mostly superficial.  The main difference I've seen, is that while both men are both pragmatists and a type of opportunist, Wilson had difficulty accepting loss and rejection.  Obama seems fine with not only half a loaf, but the end pieces.

Wilson simply didn't believe in compromise when he was invested in a fight.  As president of Princeton, he sank his administration over fights about the placement of the graduate college and his "Quad Plan" to get rid of Princeton's eating clubs.

Another difference is that Wilson as governor enjoyed a magnificent first year in office.  After that, he was stalemated by Republicans who wanted to undermine his presidential ambitions and conservative, machine Democrats who wanted to undermine his presidential ambitions.

Obama had a remarkable first two years in office legislatively (as Wilson did in the White House, but I haven't gotten that far) and then has been stymied by those whose main priority is "insuring that Obama is a one term president."  Wilson's second term was dominated by the second most catastrophic war in history.  Let's hope any similarities end there.

If there is one thing that Obama could learn from Wilson is that Wilson understood the power of educating the electorate.  Unlike any president before him - even Teddy Roosevelt - Wilson believed in appealing to the sovereign people.  He saw the President as prime minister more than chief magistrate, which was the way every president since Washington had seen the job.

Obama is a thoughtful, eloquent speaker who can take complex ideas and make them understandable.  But he needs to cut through the clutter of Casey Anthony and Shark Week and all the other distractions of our media saturated world and explain why, for instance, he keeps agreeing to legislation that he doesn't agree with.

John Cole says that unless the GOP nominates Bachmann or Perry or any wingnut, Obama will lose.  I'm not sure. My own theory is that unpopular Republican governors in Ohio, Michigan and Florida will have a huge impact on this election.

But Romney came out against the debt deal.  In the past, the debt deal was an opportunity for grandstanding. Obama certainly did that in his own past.  But this time was different.  This was the first time that we've really been up against default by design rather than accident.

To me, failure to accept a deal that staved off economic catastrophe shows a fundamental inability to accept the shit sandwich aspect of governing.

But unless Obama makes that case, he will be in trouble.

He needs to look, not to Wilson, but to Harry Truman as his model for 2012.

He needs to give'em hell.

Compromise

Well, the reviews are in for the debt deal.  In some ways, the reviews are analogous to the The Smurfs Movie.

Like the Smurfs, no one with any taste or discretion likes it.  Like the Smurfs, it might actually play well in the short term "box office."

This deal pleases no one.  It doesn't cut government enough for the Teatards, and it cuts it too much for liberals.

It doesn't do enough for long term deficits for the Concord Coalition, and it doesn't do enough for unemployment for anyone who cares about that.  Which ought to be most everyone.

Policy wonks don't like the mismatch of needs - unemployment - with policy - deficit reduction.

No one is happy.

You know, compromise.

Combine the fact that it looks like DC finally got its act together and Gabby Gifford showing up to vote, and my guess there is a bit of a bounce, a sigh of relief from those "independent" voters we all care so much about.

The only way this doesn't become a godawful, terrible, no good deal is if you can elect Democrats back into control of all three branches of the Executive and Legislative branches so that we can make productive - as opposed to destructive - changes in our tax code, our spending and our economic development.

This episode SHOULD cement the GOP's reputation as putting ideology above country, but who knows.

UPDATE: Roy Edroso has a different take on Smurfs.  See the comments for more fun.

To Everyone Who Hates The Debt Deal

Elect a Democratic House, Senate and President in 2012 and maybe we can have a sane effort, balanced between revenues and cuts to some programs - like farm subsidies, to balance the budget.

If you want sane policy, the negotiations have to be between Democrats and Blue Dogs, not Democrats and Tea Partiers.

Idiocy For The Win

Well,  we might just avoid default.

We shall do it by passing a terrible law that guys important programs in the middle of a recession.  We shall likely make the recession worse.

What I don't understand is how Obama is going to run against these cuts.  I think he has to, if he's going to win over the voters who are going to get screwed by this.  I also don't understand how we are going to stimulate the economy back into positive growth without federal intervention.

I'm not angry because the GOP "won".  I'm angry because sane economic policy lost.

Of course, the House will probably reject it since it doesn't outlaw abortion or require Obama to carry his birth certificate with him at all times, so whatever.