Saturday, September 27, 2008

 

Balin’ on Palin?

Hard to believe that Katie Couric – of all people – would turn out to be the one to deliver what might be mortal blows to Sarah Palin.

However, given what several Republicans and conservatives – onetime supporters of Palin are saying after the Couric interview –
that appears to be the case. Most notably:

Kathleen Parker at
Townhall.

Kathryn Jean Lopez at
National Review Online (admittedly the most sympathetic to Palin).

Rich Lowry,
also at NRO.

Rod Dreher at
Beliefnet.com.

Ross Douthat at
The Atlantic. In fairness, Ross also links to a surprisingly sympathetic New Republic post that puts the blame at the McCain campaign handlers for “overcoaching” her.

It is also pretty significant that John McCain had so little confidence in the woman he called his “maverick partner” during the debate – that he didn’t even want her available as a surrogate to help provide post-debate spin. Some “partner.” On the other hand, Joe Biden had significant time on both CNN and Fox News (my hotel didn’t carry MSNBC).

Whether the problem is Palin herself or the McCain team’s “control freak” management, the effect is the same – a nomination that seems to have backfired on the candidate.

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Friday, September 26, 2008

 

What you Gawkin' At?

I'm live-blogging the debate at Gawker.

UPDATE (10:50): Generally, I liked this debate. It had some good back and forth. Moderator Jim Lehrer just let them run. The debate kinda played AGAINST type. McCain was much stronger than expected on the economy and spending. He landed several haymakers on Obama's earmarks and on the costs of Obama's proposals. On the other hand, Obama came across as very knowledgeable on foreign policy. He went toe-to-toe with McCain over Iraq and its connection to Afghanistan. After five years in Iraq, more Americans may be willing to accept Obama's analysis than McCain's -- despite the success of the surge. Obama's best line may have been, "John, you seem to think the war began in 2007."

Given the last week, McCain, in particular came across as well-prepped. He was smart to start off with the nod toward Teddy Kennedy; he started off a little on the low-energy side, but he got much better as the evening went on. Obama seemed more passionate and aggressive (not too much) than he has in past debates.

Obama was more deferential to McCain than the reverse ("John is right..."). McCain was good in stressing his experience, however, he often used the phrase (or something similar) of the "many, many years" he has voted or worked on various issues. That, unfortunately, tends to bring up the age issue, which he doesn't need.

McCain was very good in listing the various differences he has had with George W. Bush. But, Obama came across as both "normal" (not "exotic") and well-versed in the issues. He didn't seem like a rookie, but thoughtful and poised.

I would score the debate a draw on command of issues, but a slight edge to Obama on atmospherics.

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Open Thread

Thread on, thread on.

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Thursday, September 25, 2008

 

Deja Voodoo Times Three

1) With words like "panic", "danger," "anxiety," and "crisis" has there ever been such a downbeat address delivered by a president? Well, one does come to mind.

2) John McCain abruptly threatening to pull out of a debate? Hmmm...

3) John McCain flying in late in sensitive bipartisan negotiations? Uh-oh.

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Wednesday, September 24, 2008

 

Come Bail Away With Me, Love

I appreciate Bickerstaff's assessment of the bailout -- straight and to the point. I readily admit to not being a finance person -- or any sort of expert on the economy. I know where I stand on it philosophically -- with my libertarian friends who are aghast at the idea of a $700 billion taxpayer-financed credit transfer.

Furthermore, Paulson and Co. were incredibly arrogant to go to Congress with a three-page paper that essentially said, "Give us $700 billion; trust us to spend it wisely" -- and then put the onus on Congress to "pass it quickly." Just from a political strategy standpoint, that's pretty dumb. It's even stupider when, according to a White House spokesman, the plan had been in the works for some time:

“It shouldn’t take much analysis to remember what happened last week, which was a very serious freeze-up in our credit markets,” Fratto said. “Our financial markets right now do not need uncertainty, they need increased certainty as to how this rescue plan is going to go forward — and that they can be sure that there is a plan to go forward — and that will begin the correction in our financial markets.”

Fratto insisted that the plan was not slapped together and had been drawn up as a contingency over previous months and weeks by administration officials. He acknowledged lawmakers were getting only days to peruse it, but he said this should be enough.

So, after being worked on as a contingency for months and weeks, a three page outline is the best the administration can do for a $700 billion bill? No wonder folks compare this to the PATRIOT Act which was a cobbling together of long-standing various intel agencies' wish-list items, but 9/11 produced the catalytic energy to get through measures that otherwise wouldn't have passed ideological muster from either the right or the left. Similarities such as this caused even Dick Cheney to get his hat handed to him by House Republicans on Tuesday.

In any event, one of the better substantive pieces I've found that outlines the need for skepticism over the bailout is by David Cay Johnston, a former New York Times tax policy writer. Johnston's questions are very straightforward, raising doubts that those on both the left and the right can find agreement:


The Administration has scared the markets and some key legislative leaders, but it has not laid out a coherent, specific and compelling need for this enormous proposal, which is the equivalent of a one-time 55 percent income tax surcharge. (Instead the money will be borrowed, so ask from whom and how this much can be raised so quickly if the credit markets are nearly seized up with fear.)

Ask this question -- are the credit markets really about to seize up?

If they are then lots of business owners should be eager to tell how their bank is calling their 90-day revolving loans, rejecting new loans and demanding more cash on deposit. I called businessmen I know yesterday and not one of them reported such problems. Indeed, Citibank offered yesterday to lend me tens of thousands of dollars on my signature at 2.99 percent, well below the nearly 5 percent inflation rate. That offer came after I said no last week to a 4.99 percent loan.

If the problem is toxic mortgages then how come they are still being offered all over the Internet? On the main page AOL generates for me there is an ad for a 1.9% loan (which means you pay that interest rate and the rest of the interest is added to your balance due.) Why oh why or why would taxpayers be bailing out banks that are continuing to sell these toxic loans?How does the proposal help Joe and Mary Sixpack who can afford their current monthly payment, but not the increased interest rate that has been or soon will take effect? Every day bankers work out loans with customers -- so why are taxpayers being asked to act when banks are largely on strike, refusing to negotiate revised deals with many loan customers?
Of course, there is the political component to take into account. Thomas Edsall notes Patrick Ruffini's call for a conservative revolt against what will be a Bush-congressional Democrats deal. Edsall likens it to Bill Kristol's torpedoing of the Clinton health-care plan in 1993. Actually, he's three years off. If anything, Ruffini's suggestion more resembles Newt Gingrich's breaking with George H.W. Bush in 1990 when "41"'s lips moved to agree to a deficit-reduction fueled by a tax hike. It' s not surprising that Gingrich is urging Republicans to reject the bailout now. Fresh from a clear victory over the Democrats on the issue of off-shore drillng -- led by Gingrich's online petition -- the congressional GOP may be more than willing to go along with the Ruffini-Gingrich strategy.

But what if? What if the ideologically (from both the far right and far left perspective) and politically correct position happens to be the wrong one? The Bush I tax hike didn't wreck the economy.

If Congress gets the bailout wrong -- i.e. doesn't authorize it -- the consequences could be trulyhat requires immediate action.
catastrophic. I was leaning toward being against it until I read two pieces by right/libertarian leaning peole whom I respect. Jim Manzi, who's written for National Review, the American Spectator and other outlets, makes a strong case for why this is an emergency t

Now consider the current situation on Monday morning. If “we” (i.e., the political leadership of the U.S.) go back on this commitment, then the loss of confidence will be even worse than it was last week. We are already trying to work around some of the inevitable inconsistencies that will be present in such an emergency action. As one example, consider that a federal guarantee for money market fund accounts means that they are suddenly much, much safer. Hence, Treasury has had to modify this guarantee over the weekend to apply only to pre-existing money market fund balances to prevent a massive flow of funds that could destabilize traditional commercial banks.

This is pure ad hoc economic management by government officials. It is a Hayekian nightmare on several levels, and as I said previously, its ideological consequences are likely to be substantial, long-lasting and negative. I can make the arguments as loudly as anyone, and I believe them, that the causes of this problem that can be laid at the feet of government are ill-advised market interventions and poor regulation, rather than insufficient controls on the market. The best long-term solutions, in my view, all involve less government intervention. It will be important to make these arguments. But the patient has been hit by a car, and is lying on the ground bleeding. It’s all well and good to discuss how irresponsible he was to wander drunk into the street, how we should better design our traffic control systems, and so on. But first we need to stabilize the patient and stop the blood loss.

Over at The Atlantic, Megan McArdle discusses how close the markets came to a catclysm last week -- which may have only been averted by Paulson stepping forward to present his bailout plan.

Finally, Steve Pearlstein in The Washington Post has had a series of columns that make the case earlier bailouts and this one in particular, can actually make money for the taxpayer over time.

I remain a skeptic -- particularly given that hardly anything has gone as "planned" in this administration (when it bothers to "plan" at all).

Alas, however, I think the current situation is too precarious to be playing political games. It's enough that George W. Bush has destroyed any real sense that Republicanism or conservatism means small government (though, ironically, in taking over the finacial industry, the Bushies may prevent Barack Obama from taking over the health care industry). Even though the roots of this crisis predate this president, the complete collapse of the U.S. economy would be a mark on his legacy that would have tragic results for all of us.

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Tuesday, September 23, 2008

 

Why The Bail Out Is Dubious

By Isaac Bickerstaff

Frankly, I could expound upon the holes of what Treasury has proposed, but it really is summed up from Treasury's spokesperson cited below. When asked how Treasury arrived at the $700 billion number:

"It's not based upon any data point," a Treasury Spokeswoman told Forbes.com Tuesday. " We just wanted to choose a really large number."

Ah, life on the Potomac at its best. At least Social Security accounts weren't privatized to invest in these troubling markets.

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Obama-Biden Debate Scheduled...

Following Biden's chastising Obama campaign for its ad attacking McCain's lack of computer skills. Oh, and Biden and Obama disagreed on the AIG bailout too.

In fairness, McCain also disagreed about the AIG bailout -- with himself.

One of these presidential tickets will actually win folks.

Be afraid. Be very afraid.

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Sunday, September 21, 2008

 

Cuomo For SEC? WTF?

Last week was hardly John McCain's finest moment when, deciding that the Securities and Exchange Commission bore major responsibility for the Wall Street madness, he essentially called for SEC Chairman Chris Cox to be fired.

(Perhaps it was my imagination, but it seemed like the day after McCain called for Cox's head, President Bush went out of his way to lump Cox, Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke as a tight troika dispatched to get the financial markets back in order. It seemed like there was a message being sent that Bush wasn't signaling blame for any single one of them.)

On "60 Minutes" tonight, McCain amended that by saying that, yes, he recognized that, technically, after nomination by the president and confirmation by the Senate, the head of the SEC can't be "fired" by the president who appointed him in the first place. However, he asserted, "When I'm president, if I want somebody to resign, they resign."

So, correspondent Scott Pelley asks, who would McCain replace Cox with. The response: "This may sound a little unusual, but, I've admired Andrew Cuomo. I think he's someone who could restore some credibility, lend some bipartisanship to this effort."

Pelley points out that Cuomo "served in the Cabinet of Bill Clinton." McCain responds, "Yes, and he did a good job and he has respect and he has prestige."

Huh? Is McCain serious? Now, don't get me wrong. Cuomo, currently New York state attorney general, is a smart Democrat, and moderate in many ways. However, there's a strong case to be made that, as Clinton's HUD secretary, many Cuomo decisions actually may have exacerbated the mortgage meltdown that is at the heart of the current financial industry crisis.

In fact, the best case for that was made, in of all places, the Village Voice. Author Wayne Barrett is an ideological journalist (as, is, of course, the publication for which he writes), but in this case, that very bias gives more strength to the argument that Barret makes in tying the Cuomo-led HUD's decision to push Fannie Mae and Freddie Mac into the subprime mortgage markets:

Andrew Cuomo, the youngest Housing and Urban Development secretary in history, made a series of decisions between 1997 and 2001 that gave birth to the country's current crisis. He took actions that—in combination with many other factors—helped plunge Fannie and Freddie into the subprime markets without putting in place the means to monitor their increasingly risky investments. He turned the Federal Housing Administration mortgage program into a sweetheart lender with sky-high loan ceilings and no money down, and he legalized what a federal judge has branded "kickbacks" to brokers that have fueled the sale of overpriced and unsupportable loans. Three to four million families are now facing foreclosure, and Cuomo is one of the reasons why.

What he did is important—not just because of what it tells us about how we got in this hole, but because of what it says about New York's attorney general, who has been trying for months to don a white hat in the subprime scandal, pursuing cases against banks, appraisers, brokers, rating agencies, and multitrillion-dollar, quasi-public Fannie and Freddie.

It all starts, as the headlines of recent weeks do, with these two giant banks. But in the hubbub about their bailout, few have noticed that the only federal agency with the power to regulate what Cuomo has called "the gods of Washington" was HUD. Congress granted that power in 1992, so there were only four pre-crisis secretaries at the notoriously political agency that had the ability to rein in Fannie and Freddie: ex–Texas mayor Henry Cisneros and Bush confidante Alfonso Jackson, who were driven from office by criminal investigations; Mel Martinez, who left to chase a U.S. Senate seat in Florida; and Cuomo, who used the agency as a launching pad for his disastrous 2002 gubernatorial candidacy.

With that many pols at the helm, it's no wonder that most analysts have portrayed Fannie and Freddie as if they were unregulated renegades, and rarely mentioned HUD in the ongoing finger-pointing exercise that has ranged, appropriately enough, from Wall Street to Alan Greenspan. But the near-collapse of these dual pillars in recent weeks is rooted in the HUD junkyard, where every Cuomo decision discussed here was later ratified by his Bush successors.

And that's not an accident: Perhaps the only domestic issue George Bush and Bill Clinton were in complete agreement about was maximizing home ownership, each trying to lay claim to a record percentage of homeowners, and both describing their efforts as a boon to blacks and Hispanics. HUD, Fannie, and Freddie were their instruments, and, as is now apparent, the more unsavory the means, the greater the growth. But, as Paul Krugman noted in the Times recently, "homeownership isn't for everyone," adding that as many as 10 million of the new buyers are stuck now with negative home equity—meaning that with falling house prices, their mortgages exceed the value of their homes. So many others have gone through foreclosure that there's been a net loss in home ownership since 1998.

Read the whole piece: Making allowances for Barrett's ideological leanings, the article is well-reported.

Now, John McCain might not know all the intricacies of the financial crisis, but, of all the possible individuals out there to consider to head the Securities & Exchange Commission, the first person that comes to McCain's mind is Andrew Cuomo?

Oh, and considering Andrew Cuomo as possible head of the SEC in a McCain administration is also problematic given that, last week, McCain's campaign launched two ads linking Obama's relationship to two former Fannie Mae executives -- Franklin Raines and Jim Johnson!

Ye gods.

UPDATE: Welcome, Instapundit and Politico readers! To underscore the point made above, the most troubling aspect of McCain's Cuomo reference isn't merely the glib nod toward "bipartisanship" and Washington-focused "respect." Instead, it's that McCain didn't seem to consider the HUD-Fannie/Freddie connection. Sure, he might not know the specific details of what Cuomo may have done in the late-'90s. But, you have to know that HUD has basic oversight of those agencies. Consider: HUD -- beginning in the Clinton-Cuomo era and continuing into the Bush years -- may have been far more culpable in creating the conditions for the current crisis than anything the SEC has done under Chris Cox. But McCain is suggesting replacing Cox with Cuomo. Unbelievable. No wonder George Will said Sunday (before the "60 Minutes" piece aired), "John McCain showed his personality this week, and it made some of us fearful."

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End of The Cathedral

After an 85-year career, Yankee Stadium packs it in tonight.  Tom Verducci has a wonderful Sports Illustrated essay on the history of the venerable edifice.  The New York Post editorial page says goodbye as well (check out the previously-unrevealed bit of trivia connectding Pope visits and Yankee postseason appearances).

Thanks for the memories, old girl.   





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