Pass the frakin’ health care bill already!

27. February 2010 by Rich Gardner.

A set of heavy-hitter economists who disagree about secondary matters on the health care bill are nevertheless unanimous. They want the health care bill passed, they want it passed by majority vote (i.e., by the reconciliation process) and they want it passed now!!! Jes’ git ‘er done fer gawsh sakes!

The above-cited piece is also a very welcome sight to see because the economists grasp what misses so many media people, that Republicans simply don’t support doing anything. This was a very clear lesson from the Blair House meeting. It’s not at all surprising that Rupert Murdoch properties like Fox News and the Wall Street Journal were oblivious to that message, but it’s irritating to see CNN be so clueless and unhelpful to their readers and viewers. Not surprisingly, right-wing blogger Jonah Goldberg complained about President Obama getting visibly tired and snappish towards what Goldberg hears described as mere “talking points,” but it’s interesting that Goldberg never describes what these “talking points” were. My suspicion  is that the “Let’s start over with a blank sheet of paper” one was one that particularly irritated Obama.

Update: A new poll shows that a problem that was apparent during Ronald Reagan’s 1980 campaign for President is still very much with us. The Republican budget-cutters say the Federal Budget is too large and must be cut. “Okay, what precisely do ya wanna cut?” “Um, well, erm, uh, something!” Foreign aid, a perennial favorite, still makes up less than 1% of the budget and goes very heavily towards Israel (And Egypt, which in turn serves Israeli interests) anyway, Welfare (Which Clinton cut very heavily) and interestingly, the “War on Terror,” which I guess is seen as a way to pay off foreign countries. Nothing else comes in at over 10% approval.

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Defend the stimulus!

17. February 2010 by Rich Gardner.

Seriously, Rachel Maddow is doing a great job attacking Republican hypocrisy for on the one hand, attacking last February’s stimulus as ineffective and, on the other hand, trying to get more stimulus money for their states. But the Democratic Party has to do its part.  The Democratic Party, the President and all of the Senators and Representatives, have to strongly and forthrightly, without apology, defend the stimulus. The can’t go scrambling around trying to find a different name for the successful bill (Naming it the “jobs” bill as opposed to just saying “stimilus II”). The ONLY reason that the word “stimulus” is unpopular is because of Republican propaganda, period! We need pushback, not retreat!

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Interesting view on cause of housing crisis

16. February 2010 by Rich Gardner.

Interesting piece traces the housing crisis to Goldman Sachs, the corporation that profited so handsomely from the TARP bailout (The CEO of Goldman Sachs ran off with a $9 million bonus for all his “savvy” banking “skills”).

Perhaps the Goldman gang’s best claim to savvy was in buying up hundreds of billions of dollars of mortgages and packaging them into mortgage backed securities, and more complex derivative instruments, and selling them all over the world. Blankfein and Goldman earned tens of billions of dollars on these deals. The great trick was that many of the loans put into these securities were issued by banks filling in phony information so that borrowers could get loans that they would not be able to repay. But this was not Goldman’s concern. They made money on the packaging and the selling of the securities.

(snip)

This triumvirate somehow managed to convince Congress that we would have a second Great Depression if it didn’t cough up the money [$700 billion] immediately with no conditions [Paulson’s famous one-page proposal]. At that point Goldman, Morgan Stanley, Citigroup, and most of the other major banks were staring at bankruptcy. While this cascade of bank failures would have been bad news for the economy, there was no plausible scenario in which it would have led to a second Great Depression.

Oh, and Goldman Sachs also apparently hacked an online poll asking if perhaps the country shouldn’t charge a $0.05 tax on financial transactions. Goldman Sachs declared that they were shocked, shocked I tell you, and that “Yeah, I think they’re going to join O.J. Simpson in looking for the perpetrators!”

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Hysteria over the deficit

5. February 2010 by Rich Gardner.

To me — and I’m not alone in this — the sudden outbreak of deficit hysteria brings back memories of the groupthink that took hold during the run-up to the Iraq war. Now, as then, dubious allegations, not backed by hard evidence, are being reported as if they have been established beyond a shadow of a doubt. Now, as then, much of the political and media establishments have bought into the notion that we must take drastic action quickly, even though there hasn’t been any new information to justify this sudden urgency. Now, as then, those who challenge the prevailing narrative, no matter how strong their case and no matter how solid their background, are being marginalized.

Paul Krugman - Fiscal Scare Tactics

Oh, and here’s a good piece on how the housing bubble got started in the first place.  Right-wingers are not wrong to say that Fannie Mae & Freddie Mac and other liberal institutions are part of the problem that led to the bubble, but they’re wrong to say that they’re the only reasons. The bubble was a broad-based one that had more complex causes.

Update: What are the real problems that America should be working on?  Excellent column by Bob Herbert of the NY Times:

We don’t hear a lot that is serious about the sorry state of the nation’s infrastructure or the trade policies that crippled so many American industries or our inability (or unwillingness) to compete effectively with China when it comes to the new world of energy for the 21st century or our abject failure to provide a quality public education for the next generation of American workers, scientists, artists and entrepreneurs.

Much more at the link.

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A proposal concerning spending

1. February 2010 by Rich Gardner.

Speaker of the House Nancy Pelosi (D-CA) has pointed out that President Barack Obama’s plan for freezing spending in certain categories improperly exempts all of the militarism budget from any cuts whatsoever. I mean, seriously now, does any sentient human being truly believe that all of the $549 billion the military intends to spend during 2011 is justified? That absolutely none of that is waste? The first two paragraphs of a July 2009 Wall Street Journal story tell a disturbing tale:

When John McCain was shot down over Hanoi in 1967, he was flying an A4 Skyhawk. That jet cost $860,000.

Inflation has risen by 700% since then. So Mr. McCain’s A4 cost $6.1 million in 2008 dollars. Applying a generous factor of three for technological improvements, the price for a 2008 Navy F18 fighter should be about $18 million. Instead, we are paying about $90 million for each new fighter. As a result, the Navy cannot buy sufficient numbers. This is disarmament without a treaty.

Probably the most egregiously wasteful program in the entire Pentagon is Missile Defense. In October 2006, the INS (Israeli Naval Ship) Hanit was hit by missile supplied by Iran and fired by Hezbollah. Even if the ship had been taken completely by surprise, it was an extremely advanced warship with an allegedly working missile-defense system. The system, in a real-time surprise problem, was useless in protecting the Israeli ship.

On 9/11, the Pentagon was protected by a missile defense system that cost $130 billion and was allegedly capable of shooting down a missile about the size of an oil drum traveling at over 6000 mph. It was defeated by a Boeing 757 (Wingspan: 124 ft, height: 44 ft, length: 178 ft) traveling at about 600 mph. The failure of that system was so blatant, the article I’ve linked to makes the case for a conspiracy, usually called a “911Truth” theory.

The Clinton Administration tested a missile defense system five times, finally saying the heck with it, “when the ‘bullet’ and booster rocket stages didn’t separate.”

In December 2004,

Pentagon officials could not immediately explain the reason for the failure. They said some kind of anomaly prompted the automatic shutdown of the launch sequence just 23 seconds before the interceptor was due to take off from the Marshall Islands in the Pacific. Plans had called for the interceptor to soar into space and knock down a mock warhead fired from Kodiak Island in Alaska about 16 minutes earlier.

And very sensibly, President Obama had to choose between a missile defense system based in Poland and the Czech Republic versus a better relationship with Russia, which was getting agitated at the potentially-aggressive system being based so close to their border.

It’s long past time America came to its senses and canceled this complete and utter waste of money. There are many other programs equally deserving of cancellation, but this program would be a very good place to start economizing.

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Are corporations, now allowed more influence on elections, owned by foreigners?

31. January 2010 by Rich Gardner.

It’s not at all clear how much ownership foreigners actually have over US corporations. So many stocks change hands so quickly, the true picture of who owns what shares of what companies is only current as of 2005.  Who has gained ownership of US corporations since then? The picture is so very complex, we can’t say with any certainty, meaning that if corporations run with the US Supreme Court decision (PDF) that says they can give unlimited amounts to candidates for public office, then that money could be coming from Russia, Venezuela, China, etc.

We should be aware, however, that  election campaigns are awash in corporate campaign cash anyway. It probably is a good idea to limit corporate camapign cash, but it’s unlikely that we can get a well-crafted, effective law to do that anytime soon.

And, yes, Politi-Fact  is generally a good fact-checking site, but they badly blew their assessment of the Citizen’s United case here.

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Bernanke re-appointed

31. January 2010 by Rich Gardner.

Federal Reserve Chairman Ben Bernanke is re-appointed with a 70-30 vote. Here’s a pro-Bernanke piece that  explains a lot about what the Fed Chairman does. But overall, it was a horrible decision, as it’s highly unlikely we’ll get a decent recovery with Bernanke in charge of the Fed. Of course, Bernanke’s re-appointment was sold with a lot of: “Aaugh! Shriek! We’re all gonna die unless we do exactly as the bankers say!1!!” “Second, the focus of his bailout was to return Wall Street to health while leaving the rest of the country reeling.” The TARP bail-out helped the really high-income people while doing little or nothing for the rest of us.

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Bernanke’s confirmation, quite properly, is in trouble

24. January 2010 by Rich Gardner.

Federal Reserve Chairman Ben Bernanke’s confirmation is in trouble, and rightly so. Seems the Chairman prioritizes inflation-fighting above tackling a 10% unemployment rate. In his own words, he pointed out that “…the longer-run inflation expectations of households and businesses have remained very stable over recent years,” in other words, inflation’s really not a problem. It’s not that Bernanke thinks there’s nothing he can do, it’s that there’s nothing he thinks he should do. It’s not a matter of can’t, it’s a matter of won’t. As long as the problem was just the historical matter of how he handled the housing bubble, he was probably okay for a second term. Now, however, there are serious doubts about his suitability to continue in the job.

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Fun with numbers - an economics dispute

15. January 2010 by Rich Gardner.

This letter was posted on the Inky’s letters page:

That was some plan

So, former Alaska Gov. Sarah Palin believed her selection as Sen. John McCain’s running mate was “God’s plan” (as revealed by a McCain political strategist). Perhaps it was the plan to illustrate her simple intellect, the inability to grasp the root causes of international conflicts, or offer workable solutions to domestic problems that allowed for a crushing presidential defeat.

All of the cute winks, “gotchas,” and other homespun homilies added up to a failed plan, be it God’s or the McCain campaign’s.

Gene Muccolini
Eastampton Twp.
gnmucc@aol.com
In response to which:

Thoughtful&concernedvoter

Wow. Gene Muccolini probably thinks BHO is more qualified to be President than Sarah Palin was to be Vice-President. What arrogance. Perhaps Muccolini has been asleep for the past year. Obama makes idiotic utternaces, bows before foreign leaders, engages in so-called “smart diplomacy” that has yielded nothing, not made the US any stronger or more secure from terrorism, and has engaged in a domestic policy agenda that has tripled the deficit and crushed job-creation prospects. What a wasted LTE, Gino.

[Yeah, I love the title this guy gives himself. Gee, full of ourselves much?!?!]

Fro 75

Hey Gene, why don’t you challenge Mrs. Palin to a debate? I am sure with your highly superior intellect you would clean her clock. I feel much more secure knowing that you and the president have such a firm grasp on complex situatiuons and workable solutions. What a numbskull…

A fellow progressive and then I responded to their response thusly:

Lori T.

Fro 75 - no one has to debate Palin, she was cut to shreds already by Katie Couric. Even the people in charge of “advising” her have come forward to talk about what an idiot she is…and she bailed on her Governorship, so that shows how dedicated she is as well. You have the right to disagree with others but calling others names is a low-brow way to get your point across. There is no doubt in my mind that Clarence Thomas was and is a total womanizer - my opinion. Do you think education level or what school you attend has anything to do with being a morally bereft person? If you equate those two, then no person who went to a GOOD school would ever break the law or cheat on their spouse. I don’t need a doctorate to be a decent, moral person.

rich2506

TCV and Fro 75 might wish to watch the video of Glenn Beck’s interview of Sarah Palin. Dude, even BECK thought her answer to his “What’s your favorite Founding Father?” was hopelessly sophomoric. Sorry, but Palin’s opinion as to economics, that tax cuts are the magical answer to all problems, puts her in my estimation as a complete lightweight, hopelessly unsuited to ever be anything more than a Fox News personality.

[This can be seen here]

Well, the right-wingers didn’t take too kindly to my comment on Palin’s economic knowledge:

RonaReagan

Hey rich2506 seems like you’re questiong the effectiveness of tax cuts while calling Palin a lightweight. Maybe you should research the impact of the 2003 tax cuts on government revenues. Hint: revenues increased significantly. Hard to believe, but it looks like Sarah knows something you don’t.

Thoughtful&concernedvoter

Rich - if you want to debate the impact of tax cuts read what Christina Romer (one of BHO’s key economists) wrote on the subject before she joined the Administration. She wrote that they had a higher multiplier effect than gov’t spending.

I made a response much earlier, but it didn’t post. This later one posted fine:

rich2506

Christina Romers paper is interesting, but she’s speaking of tax cuts minus any counter-cyclical effect, i.e., it’s irrelevant to our discussion here as countering the cycle is what Obama’s economic policies have been all about. Forbes http://bit.ly/6OJ7V4 points out that the effect of different policies is $0.99 for every dollar of tax cuts versus $1.57 for every dollar of spending, meaning the economy loses a penny for every dollar in tax cuts and gains 57 cents for every dollar in spending. Not only did Bush’s tax cuts not pay for themselves, they cost America $2.11 trillion in lost tax revenue http://bit.ly/qll37. Paul Krugman tracked Bush’s tax cuts and the unemployment numbers http://bit.ly/8koXm5. Guess what? Yup, there was absolutely no correlation. The tax cuts did zip to help the economy.

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Is the Fed able to identify housing bubbles?

10. January 2010 by Rich Gardner.

Paul Krugman brings up a very troubling point. The Federal Reserve apparently doesn’t have the theoretical tools needed to have identified the housing bubble. Krugman explains the distinction between “Flatland” and the “Zoned Zone,” showing that one type of land use was vulnerable to bubbles and the other wasn’t. He produces a chart comparing Los Angeles (A Zoned Zone because it has no room to expand, therefore a rise in demand for houses leads only to higher prices) and Atlanta (Flatland because it can just keep expanding in response to increased demand for housing) and demonstrates that Los Angeles had a bubble that began in late 2001 and started collapsing in early 2007. The Fed Chairman Ben Bernanke was using charts that didn’t recognize any distinction between Flatland and the Zoned Zone, therefore, he was incapable of recognizing either that a bubble had formed or that it was collapsing.

So I dunno, seems Dean Baker’s constant amazement that no one appears to have recognized the housing bubble may have some reason for it other than just incomprehensible, blind stupidity. Not that “We were using the wrong chart” is much of an excuse for losing several trillion dollars in housing wealth.

Krugman also shows another chart demonstrating that those who blame Fannie/Freddie/Community Reinvestment for the housing bubble or those blaming general predatory lending are both missing the larger picture. The housing bubble was a broad-based phenomenon.

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