Category Archives: Pols and Pundits

Anne Applebaum on Ted Kennedy

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Robert Bork’s America,” Kennedy declared, “is a land in which women would be forced into back-alley abortions, blacks would sit at segregated lunch counters, rogue police could break down citizens’ doors in midnight raids, schoolchildren could not be taught about evolution, writers and artists could be censored at the whim of the government, and the doors of the federal courts would be shut on the fingers of millions of citizens.”

That image – the women in the back alleys, the doors shutting on the citizens’ fingers – was powerful enough to prevent Bork from winning Senate approval. It is thus not unfair to say that the vitriol that has surrounded Supreme Court nominations ever since is one of Kennedy’s legacies, too….”

— Anne Applebaum in The Telegraph.

My Comment

Ms. Applebaum nails it. The “borking” of not just Supreme Court nominations but of political figures in general goes back to this sad episode in media history.

The Kennedys are American royalty, like the Bushes. So on an occasion like this, it’s probably not appropriate for an outsider to say more. Anyway, I was glad to see that conservatives, even rather shrill ones like Michelle Malkin, have been restrained enough and allowed Ted Kennedy’s family a few days of solemnity and sympathy, before discussing his political or personal flaws.

George Kennan on the Realities Behind US Foreign Policy (Links added)

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I have been meaning to post the surrounding text of the famous passage in which George F. Kennan, a noted Sovietologist, cold warrior, and advocate of realpolitik, expressed his view that US policy in the post-war years should be unsentimental in its attitude toward Asia. As director of the State Department’s Policy Planning Staff from 1947 to 1950 (under George Marshall and Dean Acheson), Kennan was one of the principal architects of US post-war strategy and the formulator of the policy of long-term “containment” of the Soviet Union. So the piece makes for interesting reading today, especially in light of the following:

*the destruction of Asian savings by the US government-generated debt & dollar tsunami
*the rise in food prices in Asia
* the ongoing rush by Asian governments (along with everyone else) to buy up world farmland
* the potential for global water-wars in the immediate future.

KENNAN:

II. Far East

“We are deceiving ourselves and others when we pretend to have the answers to the problems which agitate many of these Asiatic peoples.

Furthermore, we have about 50% of the world’s wealth but only 6.3% of its population. This disparity is particularly great as between ourselves and the peoples of Asia. In this situation, we cannot fail to be the object of envy and resentment. Our real task in the coming period is to devise a pattern of relationships which will permit us to maintain this position of disparity without positive detriment to our national security. To do so, we will have to dispense with all sentimentality and day-dreaming; and our attention will have to be concentrated everywhere on our immediate national objectives. We need not deceive ourselves that we can afford today the luxury of altruism and world-benefaction.

For these reasons, we must observe great restraint in our attitude toward the Far Eastern areas. The peoples of Asia and of the Pacific area are going to go ahead, whatever we do, with the development of their political forms and mutual interrelationships in their own way. This process cannot be a liberal or peaceful one. The greatest of the Asiatic peoples-the Chinese and the Indians-have not yet even made a beginning at the solution of the basic demographic problem involved in the relationship between their food supply and their birth rate. Until they find some solution to this problem, further hunger, distress, and violence are inevitable. …..

…In the face of this situation we would be better off to dispense now with a number of the concepts which have underlined our thinking with regard to the Far East. We should dispense with the aspiration to “be liked” or to be regarded as the repository of a high-minded international altruism. We should stop putting ourselves in the position of being our brothers’ keeper and refrain from offering moral and ideological advice. We should cease to talk about vague and — for the Far East — unreal objectives such as human rights, the raising of the living standards, and democratization. The day is not far off when we are going to have to deal in straight power concepts. The less we are then hampered by idealistic slogans, the better……”

— George F. Kennan, Policy Planning Study 23 (PPS23), Foreign Relations of the United States (FRUS), 1948

[From Russell Wvong’s website, via
Gilles D’Aymery in a piece on the improper use of this quote by Noam Chomsky and others atSwans Commentary.

Government Conspiracy Theory Blames Hybrid Mortgages for Depression

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Tom di Lorenzo at Lew Rockwell blog has this:

“Following Alan Greenspan’s pathetic “don’t blame me” speeches and books, various Fed branches have parroted his view that the Greenspan Depression we are in was caused by thrifty Orientals whose savings drove down interest rates.  So imagine my surprise upon receiving a hard copy of a Dallas Fed publicaton entitled “Taming the Credit Cycle by Limiting High-Risk Lending” and reading that “The present troubles emerged to a large extent from the growing use of hybrid adjustable-rate mortgages . . .”   Huh?  What happened to The New Yellow Peril?

There is no mention at all — not one word — of the role of Fed monetary policy in creating the housing bubble. The culprits, say these self-serving excuse makers (the author is Jeffrey W. Gunther), are “lightly regulated institutions” that are in need of the Fed’s “disciplining force.”

My Conment

Mr. di Lorenzo can relax –  this new tack does nothing to exonerate Greenspan. Look at this USA Today piece from early 2004, when housing was already showing bubbl-y tendencies:

“He [Greenspan] said a Fed study suggested many homeowners could have saved tens of thousands of dollars in the last decade if they had ARMs. Those savings would not have been realized, however, had interest rates shot up.

“American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage,” Greenspan said.”

Read through the whole piece and it’s  clear that American house buyers actually “preferred the stability” of the traditional fixed rate mortgages. In other words, it was only a concerted PR effort by Greenspan & Co. that changed people’s tastes in this.

Let that put an end to any moralizing of this issue.  Yes – rampant consumerism and debt binging exacerbated the problem. But the problem wasn’t caused by some moral defect in American consumers. It was caused by policies deliberately pushed by the federal government in the hope that the consumer would succumb. The chairman of the Federal Reserve thus acted no differently from any confidence man or grifter who spots a mark (a naive, uninformed person easy to manipulate), then sets about winning the mark’s confidence before baiting the trap….

You can see the chairman’s own words to the national association of credit unions on February 23, 2004. (Skip down to the last 2-3 paragraphs to catch the gist)

And now, just like any con man, the Fed chairman too blames his victims.

They had it coming to them...


Roubini, the Insider

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Robert Wenzel over at Economic Policy Journal points out that the new head of the Commodity Futures Trading Commission is Gary Gensler, who spent 18 years at Goldman Sachs as co-head of finance.

He also  has a nice hat-tip to me for spotting Roubini’s insider status first. Well, I did spot it first, but it wasn’t hard to do.  His bio on wiki has the links. You’d just need to think of looking at it. What are the chances that policy wonks who go to the same schools, attend the same conferences, live in the same neighborhood and work at the same places are going to to be “independent”?

From Wenzel:

More and more the picture that is emerging of Roubini is that of a major insider. Writes The New Republic: He has a

…swelling portfolio of clients–the World Bank, IMF, 50 central banks,and 30-odd finance ministries among them….”

Judged by the Elitest of Elites

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I knew the Supreme Court of the US was weighted heavily in favor of the elite products of high-powered law schools, high-powered federal work experience, and high-powered theories.

But this chart of the make-up of the Supreme Court in recent years at the New York Times (May 2, 2009) was still something of a stunner to me.

One hundred percent of SC justices are former federal judges.

How many now are state judges? Nil.

How many now are private lawyers? Nil.

How many now are elected officials? Nil.

How many now are government lawyers? Nil.

How many now are law professors? Nil.

As Adam Liptak, the SC correspondent at The Times, justifiably complains,

“None of the justices have held elective office. All but one attended law school at Harvard or Yale. And the only three justices in American history who never worked in private practice are on the current court..”

But then Liptak holds up as a model, David Souter, a former attorney-general of the State of New Hampshire.

This, as trial lawyer Norm Pattis points out, is like depending on a sprinter to win a marathon.

“When is the last time a lawyer who made his living from fees earned
representing ordinary working people sat on the Supreme Court?”

But the question could be asked of many more government insitutions.

When was the last time the SEC was staffed with officials from small banks and  thrifts?

When was the last time a mayor from a small-town made it to the White House?

We talk about localism a lot. But in practice we’re heavily prejudiced against it.

A small-town resume, we presume, is fit only for small-towns.

There are a lot of reasons for this but I’ll focus on a couple that strike me at once (and I’ve blogged on them recently):

(1) It used to be that education fitted you to exercise judgment. These days we avoid judgment altogether, confusing it with judgmentalism.

In the absence of the ability to judge (and any common standard to judge by), we become victims of public relations and marketing. When no one can agree on substance, image becomes everything.

Brands rule. Harvard and Yale are the best known national brands, so we outfit our justices in them.

(2) Increasing specialization means that fewer people feel capable of pronouncing judgment about something, even if they felt it was permissble to. They look instead to experts to make their choices for them. The media, which has a disproportionate effect on nearly every choice made,  tends to focus on experts who come from the same educational and socio-economic background. The circle of the elite thus tends to get smaller and clubbier with every year.

Jack Kemp Dies Of Cancer

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Jack Kemp, former Congressman and star quarter-back, George Bush Senior’s housing secretary and Bob Dole’s running mate, noted “compassionate conservative,” good-natured supply-sider and defender of Reagonomics, died of cancer today.

Kemp seemed to me to be one of the truly genial and sincere figures in politics. Here’s a characteristic quote:

“Pro football gave me a good perspective. When I entered the political arena, I had already been booed, cheered, cut, sold, traded, and hung in effigy.”

And a quick bio from Yahoo News.

“Kemp was born in California to Christian Scientist parents. He worked on the loading docks of his father’s trucking company as a boy before majoring in physical education at Occidental College, where he led the nation’s small colleges in passing.

He became a Presbyterian after marrying his college sweetheart, Joanne Main. The couple had four children, including two sons who played professional football. He joined with a son and son-in-law to form a Washington strategic consulting firm, Kemp Partners, after leaving office.

Through his political life, Kemp’s positions spanned the social spectrum: He opposed abortion and supported school prayer, yet appealed to liberals with his outreach toward minorities and compassion for the poor. He pushed for immigration reform to include a guest-worker program and status for the illegal immigrants already here….”

In January this year, around the time Kemp’s cancer was diagnosed, The American Conservative ran a long piece on his contributions.

The Am Con piece notes that Kemp would send his children out into the world everyday with three words:

“Be a leader.”

The rest of us might find them worth remembering too.

R.I.P. Jack Kemp.
(More later)

Paul Volcker Praises the Grace of Government

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The Bureau of Economic Analysis released the Q1 ’09 GDP numbers.

The annual rate of decline came in at the expected 6.1%  (a decline of 6.3% in real GDP).

Calculated Risk has an optimistic assessment of the Q1 numbers.

The optimistic case rests on the following:

  • Declining residential investment contributed more to the GDP slump in Q1’09 than in Q4 ’08 and will likely come to an end by Q2’09, in keeping with its role as a leading indicator of recession.
  • Simultaneously, the contributions of lagging indicators (like unemployment, declining investment in equipment & software, and declining non-residential investment) have increased.
  • The over-weighting of lagging indicators in the decline of GDP signals the end of recession.
  • Real personal consumption expenditure (PCE) was up in positive territory (2.2%) in Q1’09, where it was negative (4.3%) in Q4’08.

Mish Shedlock is less optimistic. He says that the Q1 ’09 rise in PCE is either an outlier  or temporary, and will be followed by another dip in 2010-11 and more trough for a few years.

Meanwhile, former Fed chairman Paul Volcker, head of Barack Obama’s economic team, thinks the economy is “leveling off,” according to this Bloomberg report.

Highlights of what Volcker is reported to have said:

  • Bernanke is “doing a great job”
  • the economy is functioning “by the grace of government intervention”
  • a strong recovery is “going to take a while”
  • “systemically important institutions” are going to be kept afloat
  • the expansion of the Fed’s balance sheet to more than $2.2 trillion as of last week will likely lead to inflationary problems in 2-3 years, but not immediately
  • Glass-Steagall (repealed in 1999) isn’t likely to be resuscitated but proprietary trading and commercial banking activity should be kept apart (Lila: how?)
  • no regulation of hedge funds is likely but in the case of those that get too big capital requirements and a cap on leverage might be imposed (Lila: this is vague and opens the door to selective regulation)
  • regulation of executive compensation isn’t likely but there could be a “quid pro quo” for federal aid. It would have to be a “culture of exchange” with Wall Street (Lila: more weasel words that allow for selective regulation).

Altogether, I thought Volcker’s comments were evasive, inadequate, and temporizing.

Tom Woods On Wealth Creation

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Nice finale to Tom Woods’ piece at Taki Magazine, putting an end to some superstitions about labor and wealth:

“Leaving aside the odd view that only manual laborers engage in “work,” all the brawn in the world could never have produced a steam engine or a Pentium processor. Only when informed by the knowledge of inventors and supplied with the capital saved by capitalists can the average laborer produce the tiniest fraction of what he is today accustomed to producing. The central ingredient in a laborer’s physical productivity is the equipment and machinery at his disposal. There is nothing natural or inevitable about the availability of this productivity-enhancing capital equipment.  It comes from the wicked capitalists’ abstention from consumption, and the allocation of the unconsumed resources in capital investment. This process is the only way the general standard of living can possibly rise.  Hartmann thinks it’s just swell to tax it.

The increases in the productivity of labor that additional capital makes possible, by increasing the overall amount of output and thereby increasing the ratio of consumers’ goods to the supply of labor, make prices lower relative to wage rates and thereby raise real wages.  That’s why, in order to earn the money necessary to acquire a wide range of necessities, far fewer labor hours are necessary today than in the past—say, 1950 or 1900. Thanks to capital investment, which is what businesses engage in when their profits aren’t seized from them, our economy is far more physically productive than it used to be, and therefore consumer goods exist in far greater abundance and are correspondingly less dear than before……

Hartmann’s argument runs, in effect: “Citizen, you need to be looted in order to stabilize the system [a nonsensical idea Hartmann came across in the popular Keynesianism that forms the entirety of his economic knowledge].  Let us hear no more anti-social talk about your so-called rights. All hail The System!  Wherever would we be without the stabilizing power of violence!”

As for the nonsense about FDR’s New Deal “stabilizing us”—and the perverse argument that our economy will never be stable unless the people are violently expropriated—check out economist Robert P. Murphy’s new book The Politically Incorrect Guide to the Great Depression and the New Deal.  Its playful title notwithstanding, this book mercilessly bludgeons thoughtless clichés like this.

At least the mafia has the decency not to put such transparently phony claims over on you. They’re honest: we’re taking your money because we have power, and you don’t.

What it all boils down to is this: one side of our political spectrum favors the central planning of Iraq, while the other favors the central planning of Americans. We can only hope for the continued growth of a third side, one that rejects as unworthy of a free people all the superstitious nonsense about the magical powers of our overlords, whether that power is exercised at home or abroad.”

Gold Above 940

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Wow. Bernanke opens his mouth and the dollar sinks to 84.5.

Can’t he read a RED STOP sign?

And this weird thing here: I saw a  piece on bond yields and when I looked it up on yahoo, it’d been removed.

/cnnm/090318/031809_credit_market.html http://news.yahoo.com/s/ynews/ynews_bs262‘

Here’s  the URL for the original site:

CMWire – The Capital Markets Newswire

But when I looked through Capital Markets wire just now I couldn’t find it.

Here’s a copy of  the google search result for the piece:

Mar 18, 2009 … Yields plummeted by the widest margin since 1987. … 14:41 AIG chief asks execs to return bonuses» CNN.com. AIG chief Edward Liddy told lawmakers ….. (

Corrects the headline to reflect that Treasury yields plunged). …
cmwire.com/ – 39 minutes ago – Similar pages –

(http://www.google.com/search?hl=en&q=yields+plunge+1987+cnn&btnG=Google+Search&aq=f&oq=)

Update:

OK – I found the piece. It’s by Deborah Levine and I found it at Market Watch.

I think the original wire report on CMWire and Yahoo might have been taken off to make the headline look less alarming, so that the reference to 1987 didn’t spook stock investors – the media’s target patsies.

You can see that the article now reads – “Treasury prices soared Wednesday, sending yields plummeting….”

The powers that be want to keep the poor Dow’s chin up at least for today before the big bad short sellers come out in droves…

“Treasury prices soared Wednesday, sending yields plummeting by the largest amount since 1987 after the Federal Reserve surprised bond investors by saying it would buy $300 billion in longer-term Treasury securities over the next six months.”

http://www.marketwatch.com/news/story/treasurys-soar-after-fed-says/story.aspx?guid={7DB91E8A-FD87-4BD4-9296-3C6EA402C920}&tool=1&dist=bigcharts&

Meanwhile here are the details at Bloomberg  on the FOMC decision:

” This Wednesday, the Federal Open Market Committee of the United States’ Federal Reserve made a unanimous decision to keep the Fed Funds rate unchanged at the 0.25% to 0% range. The rate decision was not a surprise for a good number of investors since the Federal Reserve stated clearly on its last FOMC statement that “economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time”. Even so, today’s FOMC statement sounded a bit more dovish than expected, not reflecting the positive performance of the U.S. stock, bond and credit markets over the last two weeks. The Federal Reserve said “it sees some risk that inflation could persist for a time below rates that best foster economic growth and price stability in the longer term”. In addition,  “to help improve conditions in private credit markets, the Committee decided to purchase up to $300 billion of longer-term Treasury securities over the next six months.” So once gain, the Fed said it will employ all available tools to promote the resumption of sustainable economic growth and this makes us believe that the Fed will continue to purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets. In other words, the Fed will use quantitative easing. Currency traders reacted very negatively to the FOMC statement driving the U.S. dollar lower against the world’s most heavily traded currencies.”

 Comment:

What are they doing? Blowing smoke in everyone’s eyes pretending they see deflation in store in order to throw everyone off the inflationary scent?  Hoping meanwhile that gold doesn’t pop up too much and give the game away before they finish the next mighty round of mortgage hot potato? (Most plausible scenario).

Or, are they really terrified of having so destroyed the capital base of the economy that they think something, anything (maybe another financial instrument’s been discovered we haven’t heard about)  has to be done. And since all they have is a printing press., well why not use it? Off with the heads of the middle class, the thrifty, the savers, those who have no debt, the creditors!  (Also plausible, though probably only if combined with the theory above).

There’s a third option, but I’ll explore that in another post.

And why is Bill Gross pumping this whole business to the public?

“You want to continue to buy what the government will buy,” Pimco’s Bill Gross told CNBC.

From now on, it will be Pimpco to me. Sorry.

Bernie’s Web: Madoff Fraud Hits $64.8b, Includes Family, Say Prosecutors

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Turns out that Bernie Madoff’s fraud took clients for more than what investigators originally claimed – $50 billion. Latest count is $64.8 billion  and it’s not clear that that’s the end. (Correction: I read that wrong. $64.8 is the figure alleged by prosecutors. Others say the statements are inflated and the actual losses might be less).

The new reports show things to be different from the picture the media originally gave us.

Now it looks as if Madoff didn’t promise just middling returns of 7-10% to everyone (which would imply that the scheme was believable and not on its face suspect).  The truth is he lured many people with promises of an incredible 46.5% returns that he claimed he generated through a technique called “split strike conversion” – a technique that was demonstrably incapable of providing such returns consistently.  In other words, fund managers, investors and regulators who had been doing their due diligence, would have known without difficulty that he was lyng through his teeth.

Now, this isn’t the first time this angle of the story has been reported, but it’s the first time the media has been willing to admit that Madoff’s scheme was an outrageous, flagrant fraud that went on for decades under the noses of the very people now writing the stories about it in righteous indignation (the New York Post, in this case). Regulators were told repeatedly by reliable people that Madoff was running a Ponzi scheme. Where were they?

Why do I bring all this up? To lay to rest the idea that more regulation (presumably by the same bunch of corrupt, incompetent, treacherous hacks in DC and New York) is going to help things.

More interesting details from the Post article:

* Contrary to early reports, the Madoff family and an inner circle of Madoff friends seem to be deeply involved with money laundered through “an English bank.”

* Wife Ruth is now “an object of investigation.”

* It seems that low-level employees were hired to create the appearance of a trading operation, with money even being moved from New York to Europe and back to bolster that impression (shades of Enron’s Potemkin office).

Obama Tanks the Dow

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More here

Comment:

Going further,  the Deal Journal gives the President some tips on how to make nice to the market and stop being Obummer.

The budget numbers are out, and they aren’t pretty, projecting a $1.75 million deficit for the year and including a provision to auction off permits to exceed carbon emission caps (frankly, this sounds like the sale of indulgences by popes during the Middle Ages – only now, we’re all so much more enlightened...).  This might tank the Dow even more,…

Especially if it also takes a look at  GM’s horrible numbers (a $9.6 bn Q4 loss and a decline in its cash position from the previous quarter of $2.2 bn ($16.2 bn to $14 bn).  And let’s see what London’s FTSE will do now that Royal Bank of Scotland has announced the biggest annual corporate loss in UK history ($34.2bn/24.1 bn BP)

Obama Declares Day of Reckoning…

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“Bluntly declaring that the “day of reckoning has arrived” after years of financial irresponsibility, President Barack Obama told Americans on Tuesday night that “we will rebuild, we will recover and the United States of America will emerge stronger than before.”

Comment:

Hmm……some of that reckoning talk sounds suspiciously like the language that Nina Totenberg as well as some NY Times writers were using a while back….shortly after NPR cited “Mobs, Messiahs, and Markets”…..shortly after we sent them the book……..

(Coauthor of said opus is the principle writer and creator of the Daily Reckoning....a newsletter very familiar to Beltway and non Beltway critics of empire as well as libertarians of all stripes, left and right….)

Meanwhile, here’s another headline that caught my eye for a different reason:

“Can Obama Save the Planet?” asks Robert Roy Britt at MSN.

Quite a mandate.  Not only is the president going to “fix the economy” (as though the economy were some wretched stray in need of neutering), heal racial tensions, win the “war on terror,” – now he’s going to save the planet too. Last time I looked a certain rabbi had that job…

Erk.  How do journalists come up with this stuff?

Alan Keyes Denounces Obama As Abomination

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Alan  Keyes, the conservative who lost to Obama in the 2004 Illinois Senator’s race, is back again with a fiery denunciation of the new President as a “radical communist” and “abomination” who “isn’t even a natural born citizen” and once (presumably when he was young) even supported setting aside babies who escape abortion for killing (?).

Inflammatory stuff….or speaking truth to power…. depending on what you think of Keyes.  Obviously, Fox loves him since they’ve been giving him a lot of air time on this, and the video is making a stir.

What is a “natural-born citizen”? It’s a citizen who meets one of  the legal criteria to be considered, by right of birth, a US citizen”. It’s not simply where you were born.  If you were born on foreign soil, you would still be a natural born citizen if at least one of your parents was a citizen who had lived in America for at least 5 years. Obama Senior was a Kenyan citizen. Obama’s mother was a natural born US citizen, although I’ve seen questions raised about that too.

There are also doubts if the marriage was a valid one under US law. Furthermore, Obama’s mother soon divorced his father and went on to marry another foreign national, with whom she moved to Indonesia.

The L. A. Times has a summary of the birth-certificate controversy, and here’s another at Salon, both of them from a critical point of view. I actually thought the issue had been laid to rest last year, but apparently not. Keyes and other members of the Independent party  filed suit  on November 13, 2008 (I was out of the country then, so I guess I missed it):  Keyes v Bowen, Superior Court, Sacramento, 34-2008-80000096-cu-wm-gds.

Previous suits on this issue have been dismissed because the plaintiffs lacked “standing” – which is the legal requirement that a matter brought to the courts have some specific, concrete effect on the person bringing the suit. You can see why. Otherwise, people would be cluttering up the courts with cases filed on theoretical grounds. Keyes, a former presidential candidate, does have standing, although that might be affected by the fact that the election is now over.

Alan Keyes is a very passionate proponent of the traditional Catholic position on abortion, and from that view point nothing he said was really untoward, although some of his facts are still in question on the birth certificate issue and his “fire and brimstone” delivery will strike many people as either over the top, hilarious, or both.  I also do think the word “abomination” was inflammatory and unnecessary. “Abomination” coming from an arch-conservative and statist carries Biblical overtones and will resonate with people who read Revelations (of John of Patmos, at the end of the Gospel) literally. Many of them will think of the “abomination of desolation” and  the “false messiah” (Obama is incessantly dubbed a  ‘messiah’ both by admirers and detractors) who precedes the Anti-Christ.

On second thoughts, though, I’m not sure  critics have a right to question the language on this tape, since it was the Obama camp itself that went out of its way to play up the ‘messiah’ angle. They probably figured that if religious rhetoric worked for Bush, why not lure away some of Bush’s religious following by cloaking their establishment front man, Obama, in dressed-up “preacher talk.”

A lot of Obama’s rhetoric is simply PR, as my post “Wake Up and Smell the PR” (over the weekend), alleges, and so what can I say? Live by PR, die by PR……

And, what if Keyes prevails? Then we get President Biden:

20th Amendment, Clause 3:“3. If, at the time fixed for the beginning of the term of the President, the President elect shall have died, the Vice President elect shall become President. If a President shall not have been chosen before the time fixed for the beginning of his term, or if the President elect shall have failed to qualify, then the Vice President elect shall act as President until a President shall have qualified; and the Congress may by law provide for the case wherein neither a President elect nor a Vice President elect shall have qualified, declaring who shall then act as President, or the manner in which one who is to act shall be selected, and such person shall act accordingly until a President or Vice President shall have qualified.”

Here’s more on Obama’s birth certificate and some of the facts surrounding his Kenyan father’s citizenship (Kenya was part of the British empire at the time). Obama Jr.’s Kenyan citizenship would have expired in 1982, in the absence of any renunciation of US citizenship on his part. More from the same website on some of the groups behind the promotion of the citizenship issue. I’m not sure that the website actually gives any evidence that’s incontrovertible, though, beyond a replication of a photocopy of the birth certificate (?).

Most of the debunking seems to be of the order – ‘he says it’s a dirty tactic, so it’s not true’.…or, ‘look who’s behind the issue.’

He says, she says is not evidence.  Its doesn’t go to the substance of the charges.

Other thoughts:

1. Wouldn’t a birth certificate be a minimum requirement for a candidate and wouldn’t intelligence have checked that out long before anyone was even under serious consideration for presidency? It would be incredible if it weren’t  so, given that even rather lowly jobs these days require quite a bit of a background check.

2. Why is the certificate number blacked out?

3. Are the type and seal authentic?

4. What about the categorization of the child father as African?

5. Why not just release the original and put an end to the issue?

More:

*Philip Berg (no relation to Nicholas Berg who was beheaded in Iraq), a 9-11 truther (not sure which of the many 9-11 groups that is), is one of the people who’d earlier filed suit. Berg also filed a RICO suit against Bush et. al. over 9-11.

*The eligibility issues was previously raised for Mitt Romney’s father George, who ran for president in 1968. The ruling was that he was eligible since his parents were US citizens, even though he (George Romney) was born in Mexico where they were missionaries. In 1964 another challenge was defeated when it was decided that Barry Goldwater, who was born in Arizona before it was a state, was eligible.

Propaganda Nation: Obama As Marketer-in-Chief

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 Every so often, plain-speaking slips through…. even on the pages of the New York Times. Here’s a quote on the Geithner plan:

“As a whole then, the plan takes important steps in the right direction, but it is unclear in critical aspects. We do not know whether this is because the Treasury cannot afford to be too clear, or whether it is because the Treasury still has little idea about what to do. The coming days will tell.

Finally, the plan will need public and political support to be credible. This means that bankers and existing investors should not be seen as benefiting at the expense of the taxpayer, and that all the government investment should start paying off in the not-too-distant future. While the Treasury has resisted the urge to ceremonially sacrifice the bankers, this makes it even more imperative that President Obama’s political skills be used to sell the plan.”

Diamond, Kashyap and Rajan on the Geithner Plan, Freakonomics blog, NY Times, February 12, 2009

(The emphasis at the end of the excerpt is mine. The blog on which this post appeared is run by Steven D. Levitt, co-author of the best-selling, Freakonomics;  the economists who are guest posting are University of Chicago Professors, Douglas Diamond and Anil Kashyap, and IMF economist, Raghuram Rajan)

Time Magazine Hits The Kleptocrats….And Misses

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If you ever wanted to see propaganda in action, check Time magazine’s list of the 25 people responsible for the financial collapse upon us:

“Twenty Five People To Blame For the Financial Crisis.”

Comment:

Where to begin?

For starters: I’m not a fan of “Top 40s” listings except for the Top Forties, i.e., for popular trends, celeb fashion faux, Red Book girlie advice and such like. At ostensibly news-heavy publications (then again, perhaps that’s rather an ambitious term for a coffee-table glossy like Time) you’d  expect at least a pretense at deep thinking. Apparently not….

Second:  Why 25? There’s so much blame to go around that you either make a list of hundreds (how about the Misfortune Five Hundred?)  or whittle it down to the Big Ten…

Third:  We expected Bob Rubin to be given a free pass, since the media has always had a peculiar love affair with this slippery guy, and we expected the knee-jerk over-emphasis on Republicans, but George Bush is more responsible than Alan Greenspan (Fed Chairman under Clinton and Bush) ??

Whatever you think about Bush, there’s one thing quite clear – the man was not an intellectual powerhouse…nor was he a  shrewd tactician.

Do you really think he was anything more than a mouthpiece…..and probably a fairly sincere mouthpiece…when it came to economic and financial issues?

Now, before I venture any further analysis, I want some honest reader response here. Since I am being brave and taking the personal and financial hits that go with public bloggery, you dear readers, must do your part as good citizens and raise your hands (and voices) in public. Tell me what you think this list means and how and why it was cooked up.

And here I give you an original rajivanation:

Not with silence and stealth are republics defended –  but so they are lost

Terror Wars: Mumbai Attacks Not About Kashmir

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KABUL: Indian Foreign Minister Pranab Mukherjee said on Thursday international community should not link 26/11 attacks on Mumbai to the Kashmir dispute.

Addressing a joint press conference with his Afghan counterpart Rangeen Dadfar Spanta, Mukherjee said the international community has to take Mumbai attacks as a part of global terrorism,

Apparently referring to the recent statement made by the British Foreign Secretary David Miliband on Kashmir suggesting terror attacks in south Asia would stop with the resolution of the Kashmir dispute, Mukherjee said: These attacks (on Mumbai) are not related to Jammu and Kashmir and are a part of global terrorism.”

More at The Jang News, Pakistan.

Comment:

What’s with Miliband? Whence this common-sense approach so conspicuously absent from that little unpleasantness in Mesopotamia this past – what is it? – half a decade?

Oh, I see. The Brits don’t want the Wogs* to step out of their carefully allotted place in the terror theater.  Can’t have Gunga-Din getting a piece of the global terror racket. No, let the regional empires stick to the regional market. And let the Anglo-American Empire collect on the global terror trade – where you get the best prices and the highest return on your money.

*Westernized Oriental Gentlemen

New Blinds On The Old Broken Window

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The colorful face of empire:

“With a black first family in the White House and a diverse group of appointees and Cabinet nominees, the all-white dinner party feels all wrong. Certain hosts are suddenly grappling with a new reality: They need some black friends. Overnight, black politicians, lawyers and journalists are hot properties, receiving engraved invitations from people they never got invitations from before. (emphasis mine)

“This article, trumpeting the latest blend of powerbrokers, is about as far from the mark of what the real problem is as you can get without entering a vegetative state.  As if we’re supposed to be all Woo Hoo! because the percentage of beltway players that could use a tan has gone down.  Please…

See, the issue here isn’t what the people with influence look like.  Their overwhelming whiteness has been historical coincidence due to previous factors, which is being dealt with already.  No, the issue is this: as long as the same ideas and the same worldview are in charge, nothing will change, no matter how loudly the mainstream press cheers.  If accepting the status quo is the price of admission then functionally we’ve not moved, and are merely sticking new blinds on a broken window….”

Read the rest of the post by libertarian blogger, Psychopolitik

Comment:

 Now, tell me why you never hear this slant from most of the African American community’s representatives in the media? Instead, you get the voices of the “welfare establishment” – those who think the community must always look to Washington to address its problems. Less frequently, you hear the voices of conservatives, but they also think you need to have someone with a gun and a slogan as some kind of prop for their religious views.

You hear someone with libertarian or antistate views rarely.

 But then, of course,  why would you, with a media mostly beholden to the gun-makers correction: weapons industry and the sloganeers?

Update:Rereading this, I find it sounds as if I am opposed to gun ownership. I am not. I meant the weapons industry, as in weapons of war.

I’m all for responsible gun ownership and nurse unending dreams of  that handy revolver I’ll have some day, hidden snugly in a hip pocket….

 

 

Ken Wilber On the Dangers of Magical Thinking

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A welcome antidote to the magical thinking of many New Age gurus from writer Ken Wilber:

“The New Thought schools, of which Christian Science is the most famous, mistake the correct notion “Godhead creates all,” with the notion, “Since I am one with God, I create all.”

This position makes two mistakes, I believe, which both Emerson and Thoreau would have strongly disagreed with. One, that God is an intervening parent for the universe, instead of its impartial Reality or Suchness or Condition. And two, that your ego is one with that parent God, and therefore can intervene and order the universe around. I have found no support for that notion in the mystical traditions at all.

Advocates of the new age themselves claim that they are basing this idea on the principle of karma, which says that your present life circumstances are the results of thought and actions from a previous lifetime. According to Hinduism and Buddhism, that is partially true. But even if it were totally true, which it isn’t, the newagers have, I believe, overlooked one crucial fact: According to these traditions, your present circumstances are the results of thoughts and actions from a previous life, and your present thoughts and actions will affect, not your present life, but your next life, you next incarnation. The Buddhists say that in your present life you are simply reading a book that you wrote in the previous life, and what you are doing now will not come to fruition until your next life. In neither case does your present thought create your present reality.

Now I personally don’t happen to believe that particular view of karma. It’s a rather primitive notion subsequently refined (and largely abandoned) by the higher schools of Buddhism, where it was recognized that not everything that happens to you is the result of your own past actions. …

And so where does that notion itself come from? Here I am going to part ways with Treya and spin out my own pet theories on the people that hold these beliefs. I am not going to relate compassionately to the suffering these notions cause. I am going to try to pigeonhole them, categorize them, spin theories about them, because I think the ideas are dangerous and need to be pigeonholed, if for no other reason than to prevent further suffering. And my comments are not addressed to the large number of people who believe these ideas in a rather innocent and naive and harmless way. I have in mind more the national leaders of this movement, individuals who give seminars on creating your own reality; who give workshops that teach, for example, that cancer is caused solely by resentment, who teach that poverty is your own doing and oppression something you brought on yourself. These are perhaps well-intentioned but nonetheless dangerous people, who in my opinion, because they divert attention away from the real levels – physical, environmental, legal, moral, and socio-economic, for example – where so much work desperately needs to be done.

In my opinion, these beliefs – particularly the belief that you create your own reality – are level two beliefs. They have all the hallmarks of the infantile and magical worldview of the narcissistic personality disorder, including grandiosity, omnipotence, and narcissism. The idea that thoughts don’t influence reality but create reality is the direct result, in my opinion, of the incomplete differentiation of the ego boundary that so defines level two. Thoughts and objects aren’t clearly separated, and thus to manipulate the thought is to omnipotently and magically manipulate the object.

I believe that the hyper-individualistic culture in America, which reached its zenith in the “me decade”, fostered regression to magical and narcissistic levels. I believe (with Robert Bellah and Dick Anthony) that the breakdown of more socially cohesive structures turned individuals back on their own resources, and this also helped reactivate narcissistic tendencies. And I believe, with clinical psychologists, that lurking right beneath the surface of narcissism is rage, particularly but not solely expressed in the belief: “I don’t want to hurt you, I love you; but disagree with me and you will get an illness that will kill you. Agree with me, agree that you can create your own reality, and you will get better, you will live.” This has no basis in the world’s great mystical traditions; it has it basis in narcissistic and borderline pathology….”

Comment:

I posted this quote just after the quote I posted from Deepak Chopra, one of the most popular dispensers of New Age thought. I think it provides a corrective to some aspects of that thought. It’s not that I dislike Chopra or his brand of popular Hinduism. I don’t….at least, what I’ve read of it, which isn’t all that much. I think it has its uses. And apparently, millions of people agree with me on that. I also don’t think his comments about terrorism to CNN in November – which provoked a sharp reaction from Dorothy Rabinowitz of the Wall Street Journal – are as off-base as she writes. They aren’t. He probably knows more about terrorism in India than she does.

But there is a tendency in a lot of New Age thought – one that gets amplified by the narcissism and consumerism of mass culture – to relate everything to the “inner” world of the self (the model of the self as “inside” and apart from its relation to the material world… and to others… is itself problematic). This tendency to dismiss logic, rationality, and the sheer materiality of life; to refuse harsh emotions, physical facts, and the intractability of things – this is problematic.

I’ve written elsewhere on the dangers of magical thinking. Here, for example, is a piece I did on Ward Churchill’s description of 9-11 as “roosting chickens.” It’s an interesting read, today, after the latest wave of terrorism in Mumbai.

In any case, here is the rest of Wilber’s critique in “Grace and Grit.”

(Note: I only know one book of Wilber’s – “Spectrum of Consciousness.” I thought its synthesis of elements from different religions tended to gloss over differences, in an effort to systematize, although it was fairly interesting and useful in other respects. It’s actually been some time since I read it, though, so perhaps I am doing it an injustice. It’s not the kind of thing I like to read any more. I prefer books that are more experiential, biological, and/or psychological.

Right now, in fact, I read a lot of peak performance literature.

 

 

ObamcCain: The Politics of Pose

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“Will anyone ask the Democratic candidate how he feels about stoking up a replication of the Iraq disaster, with a possible war between nuclear Pakistan and nuclear India as lagniappe? The dawn of an Obama administration is now scheduled, on the candidate’s pledges, to see escalation of a doomed and pointless war in Afghanistan and perhaps also termination of Karzai, now square in Uncle Sam’s sights as a failure and probably scheduled for assassination. There’s the heritage of JFK and Vietnam for you. It’s back to 1963.

Asked if Russia was evil, just like the Soviet Union in Ronald Reagan’s eyes, Obama said yes, McCain “maybe”. Trade? Latin America? Africa? Europe? Nothing from either man, though they both agreed that they would flout the UN at will.

Of the two performances, Obama’s was the more appalling since he is meant to be the candidate of change and new ideas. He has no detectable commitment to change and no new ideas. Neither does McCain. Yet the post-debate panelists mostly claimed the Town Hall Meeting an absorbing affair, rich in content. We have one more debate, in which McCain will have another chance to reduce Obama’s commanding lead, something he failed to do last night, even though it now seems Sarah Palin did slow McCain’s slump with her performance last week. McCain and Palin are trying to get traction by slurring Obama for association with Bill Ayers, a leader of the the bomb-throwing antiwar Weathermen in the 60s. Obama was eight when they threw the bombs. It doesn’t seem a productive line of attack for McCain and Palin, particularly when many Americans wouldn’t mind blowing up Wall St themselves….”

Alexander Cockburn in Counterpunch.

Barry Dyke On the Corruption of Bank-owned Life Insurance

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“Barry Dyke, a New Hampshire investment adviser who has studied BOLI, said other banks will likely face losses. “It’s a much bigger issue,” he said.

Bank-owned life insurance had been seen as a safe place for banks to invest their capital but it’s grown increasingly risky, said Dyke, president of Castle Asset Management LLC. “What has happened is banks took a really good thing and corrupted the purpose,” he said.

The insurance writedowns is one of a number of missteps that has plagued Wachovai in recent weeks. It reached a $144 million settlement with regulators over its ties to telemarketers and has said it expects a $1 billion charge in the second quarter because of the accounting of controversial leasing tax shelters.”

More at the Charlotte Observer, from our friend Barry Dyke, whose “Pirates of Manhattan” is selling like hot-dogs at a ball game just off his own website, with no big-time New York agent, no big-time New York publishing house, no big web seller like Amazon, no big bookstore chain like Borders, or anything else but his own lung power on local radio shows. Way to go, Barry.

Econ-job: US food prices to rise sharply…just as more mortgage payments shoot up…(revised)

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According to the Financial Times,

“When William Lapp, of US-based consultancy Advanced Economic Solutions, took the podium at the annual US Department of Agriculture conference, the sentiment was already bullish for agricultural commodities boosted by demand from the biofuels industry and emerging countries.

He added a twist – that rising agricultural raw material prices would translate this year into sharply higher food inflation.

Comment:

Read further down in the Financial Times piece and you will note that the IMF, on the other hand, appears not to believe that the developing world will decouple from the US. If there is no decoupling, it says, then a US recession will cause global growth to slow and push down food prices.

The question boils down to whether you believe what an interventionist economist at the IMF says or what the market (the commodity market) says….

For one answer, read Bill Engdahl’s piece on the financial tsunami coming our way and how complex, Nobel prize-winning economic theories and models are the problem behind, not the solution to, the present crisis.

Why?

Because they are houses built on the sand of specious notions. Notions of a perfectly rational “economic man” and of a perfectly Gaussian “efficient market.”

“As hundreds of thousands of Americans over the coming months find their monthly mortgage payments dramatically reset according to their Adjustable Rate Mortgage terms, another $690 billion in home mortgage debt will become prime candidates for default. That in turn will lead to a snowball effect in terms of job losses, credit card defaults and another wave of securitization crisis in the huge market for securitized credit card debt. The remarkable thing about this crisis is that so much of the sinews of the entire American financial system were tied in to it. There has never been a crisis of this magnitude in American history.

At the end of February the Financial Times of London revealed that US banks had “quietly” borrowed $50 billion in funds from a special new Fed credit facility to ease their cash crisis. Losses at all the major banks from Citigroup to J.P.Morgan Chase to most other major US bank groups continued to mount as the economy sank deeper into a recession that clearly would turn in coming months into a genuine depression. No Presidential candidate had dared utter a serious word about their proposals to deal with what was becoming the greatest financial and economic meltdown in American history.”

More by Bill Engdahl at Oilgeopolitics.net.

Update:

I might have been a bit naive in the piece above. I was rightly curious about the IMF economist’s motives in telling us that food prices would go down in the future, when the grocery shelves say the opposite.

But I was a bit trusting about the first quote.

So here’s a bit of belated digging.

Who is Bill Lapp and this consultancy Advanced Economic Solutions?

Lapp is a former VP of research at Con-Agra. A little googling reveals that just in 2007, ConAgra settled with the SEC over various financial improprieties.

He also seems to show up at Harvard run bashes for agribusinesses, says Hal Hamilton of the Sustainability Institute. And seems to like cheering on Monsanto’s attempts to shove biotech down the mouths of unwilling Europeans as Adam Smith in action….a curiously fundamentalist interpretation of The Wealth of Nations that, as Hamilton points out, would probably have left old Adam speechless.

The website of the Kansas City Board of Agriculture had this:

“Lapp, who has been appointed to his first two-year term, has more than 25 years of experience in analyzing and forecasting economic conditions and commodity markets. He recently formed Advanced Economic Solutions, which provides economic and commodity analysis to agri-business and food companies. Prior to that, he was the vice president of economic research for ConAgra Foods. Lapp currently serves on numerous boards, including the Kansas City Federal Reserve Board’s Center for the Study of Rural America, the Farm Foundation, and the Food and Agriculture Committee of the Omaha Chamber of Commerce. Lapp is a member of USDA National Agricultural Statistics Service Advisory Board and participates on the Harvard Business Industrial Economists’ Round-Table.”

And here we find Bill Lapp saying about what he said up above....only he’s saying it in s 2004.

Since 2002, the value of the dollar has dropped 25% while commodity costs have risen 46%. In fact, according to the CRB Index, commodity costs earlier this year were at their highest level since 1984.

The result was that in the year between April 2003 and April 2004, soymeal prices rose 92%, cheese 90%, soy oil 54% and chicken breast meat 47%, just a few of the more dramatic price jumps.

The good news? April seems to have been the peak for this escalation. Since then, many (though not all) commodities— especially grains and dairy products,but not proteins—have seen price declines, some quite sharp. This is due, Lapp indicated, to a stabilization of the dollar and a slowdown in the Chinese economy. Over this period, cheese prices have fallen 33%, corn 24% and soymeal 23%. However, protein prices remained high through mid-June thanks to continued high demand driven by the low-carb diet fad, along with constrained domestic supplies and a ban on Canadian beef imports.

What about the future? If that could be predicted with certainty, there would be no futures market in commodities. However, the best guess, according to Lapp, is that moderation in price will continue through the end of the year, perhaps extending even to protein after Labor Day and the end of the peak summer season. A continued economic lull in China would also reduce demand from that market, lessening pressure on global supplies.”

Here is Lapp in December on the rate of inflation in US food prices over the next five years:

“During the next five years, food inflation is forecast to increase by an average of 7.5 percent, well above the 2.3 percent average of the past 10 years.

“The US experienced a similar period of rising commodity prices and food inflation in the 1970s. Commodity prices doubled … this ultimately resulted in food inflation from 1972 to 1981 averaging 8.2 percent,” the study said.

Traditionally, the food industry — processors, grocery stores, restaurants, and others — absorbed the cost of higher commodity prices within its operating margins as the rise was temporary given the competitiveness of retailers.

But times are changing, said Lapp, who is a consultant to the food and agricultural industries….”

And here’s Lapp in this piece telling the consumer that he can – and should – pay higher prices.

“Lapp, the former leading economist for ConAgra, told Brownfield bread prices rose over 10% in 2007 and are likely to do at least that again this year. He added other food prices will also head higher as food manufacturers increasingly pass on the costs of high commodities to consumers. The good news, Lapp said, is that most U.S. consumers can afford to pay up, even if they won’t have much choice in the matter.

“I think consumers are more prepared than we realize to accept higher prices on food and I think that’s part of our future,” Lapp predicted. “It’s largely been set in stone for us already.”

Hillary’s Chinese cookbook….

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Joe Sestak is on “Tucker Carlson” defending Hillary Clinton’s performance in the Democrat debate, and later, her explanation on CNN about what she meant when she referred to “the old boy’s club” when she was at Wellesley.

Sestak says she’s doing no more than what John Kennedy did, when he said he was running not to be a Catholic president, but to be a president who happened to be Catholic. Sestak points out that since most Democrats are women, she ought to run as a woman. A smart and very capable woman, he adds, listing his encounters with her over the years.

What were those? Apparently, she asked him about China’s naval strength and how it might pose a threat to the US in the future.

Wow, one smart chick, was the reaction you were supposed to have.

Wow, indeed. Because, the Clinton-as- old-China-hand is a true enough meme — after a fashion. I mean China hand-outs. Think Norman Hsu, the apparel executive, who raised a good bit over $1 million for La Clinton’s campaign, making him one of the top 20 Democratic fund-raisers in the country.

Note, Hsu’s hedge-fund buddies like Stephen Schwartzman (of Blackstone group) are no different from Barack Obama’s hedge-fund buddies (Paul Tudor Jones and Orin Kramer). Hedge fund managers, we strive to remind ourselves, are also God’s creatures and every bit as deserving of representation as you or I. And if they swear that they have had nothing in return for their munificence, far be it from us to snicker (at least, not too much). We too have received a pay check (albeit several orders of magnitude smaller) from the well-heeled and have we shaped our mouth after our moolah..nein, gentle reader, so why not believe the same of Ms. Clinton?

Still….still..

Here’s what sticks in our craw: Sestak seems to be a bit of a China-hand himself:

To wit:

“Sestak is an ex-Navy admiral who served as Director of Defense Policy on the Clinton National Security Council from 1995 to 1997. Sestak often served in positions that required expertise in weapons and space technology. Sestak served in the G.W. Bush administration as Deputy Chief of Naval Operations Warfare Requirements and Programs In fact, Sestak wrote a detailed report on Navy Space Policy Implementation in May 2005 before retiring from the service.

Despite his vocal campaign today, Sestak served in the Clinton White House as the “silent” watchdog over U.S. Defense policy. The reason why I can legitimately call Sestak the “silent” watchdog is because at no time during the various Clinton scandals did Sestak raise any alarm.

For example, the admiral did nothing to stop Chinese espionage from obtaining a vast array of American military technology. Sestak prides himself as being a patriot and an expert in military space technology, yet the records show that he remained silent when encrypted satellite communications systems, missile nose cone designs, and radiation-hardened chip technology were virtually given to the Chinese army….”

Of course, this comes courtesy of NewsMax,

perhaps a tad Clintonphobic?

More on this to come.

Meanwhile, there are delicious rumors about hired claques at the Democrat debate. That’s the lowdown about the surprising booing that greeted both Obama and Edwards when they accused Clinton of being a Beltway insider (hardly a shocking revelation).

And CNN reveals that a college student who expected to ask Clinton about Yucca mountain was instead steered to ask her about her preference in jewelry.