Tuesday, March 31, 2009

Obama and Notre Dame

President Obama has agreed to serve as commencement speaker at Notre Dame's graduation in the Spring, where he will also receive an honorary degree (as is customary). The President's notable support of abortion rights has caused quite an uproar, with many in the Catholic community calling for Notre Dame to rescind its invitation.

President Obama is quite clearly pro-abortion, and that places him squarely on the other side of the question from the teaching of the Catholic Church. Notre Dame is ostensibly a Catholic University, and many see his speaking at graduation as a ceremonial "thumbing of the nose" at the church's pro-life teachings.

I disagree. While Notre Dame is a Catholic University, it is also an American University...and as such, it is a place where freedom of speech should be particularly well-protected (although conservatives on modern campuses sometimes don't receive this benefit). Mr. Obama is the freely elected leader of this nation, and while his views on abortion are inconsistent with the church's teachings, his obvious concern for social justice and human rights place him squarely in the mainstream of modern, liberal Catholic theology.

It is an honor for any University to have the President deliver the commencement address, even one with whom many might disagree.

What Happened to Tom Cruise?

I just watched the last 40 minutes of Jerry Maguire, Tom Cruise's 1996 hit that also starred Renee Zellwegger in what I think was her first big role (and she was fetching!). You cannot watch this movie and NOT like Tom Cruise. He did not appear to be acting...not in the least. I guess some would say that is truly great acting.

The Color of Money....Days of Thunder...A Few Good Men...Mission Impossible....The Firm....Magnolia....the 1990's BELONGED to Tom Cruise. He made hit after hit, he was a real live movie star, and he looked like a decent guy to have a beer with.

Along came the Scientology, the Oprah appearance, the Matt Lauer interview, the Brooke Shields criticism--the turn of the century was not good for Tom Cruise. He's a cartoon character now, a puffed up version of a comic book character control freak.

I wonder if he'll ever be able to return to a regular guy who makes great movies?

Monday, March 30, 2009

UVA Basketball Has A New Coach



UVA has apparently hired Tony Bennett (I know, I know) to be its new men's basketball coach.

I've never heard of the man. He's been at Washington State for three seasons--in the first two he took his team to the NCAA's, this year he was 16-13 and a first round loser in the NIT.

Where did the rumors of Tubby Smith and Jeff Capel come from, I wonder? Are UVA hoops fans that delusional to think that a program that has won exactly one ACC tournament in its history (1976--Ralph Sampson never won an ACC tournament title) can really compete for coaches at that level?

To say I'm a little let-down is an understatement.

GM and Chrysler Get Bad News

Looks like the Obama Administration is administering tough medicine to the two most ailing car manufacturers, giving GM and Chrysler 60 and 30 days respectively to get their acts in order. Additionally, GM's CEO is out, reportedly at the behest of the Obama Administration. A couple of things about this.

1. The Dow will drop 500 points today as skittish investors see additional signs of the Apocalypse. Institutional investors saw this coming and have already priced this into their outlooks. The steep drop to occur today will be earned back within two weeks.

2. Unlike some, I don't see the forcing out of GM's CEO as evidence of nationalization/socialization. I think the Obama Administration has a fundamental interest in seeing that the money taxpayers have paid into this corporation is well spent on a company headed in the right direction....and if that isn't the case, making the CEO and the GM Board aware of that fact is part of their duty. As a matter of fact, I see what appears to be Obama's "letting them fail" policy as reinforcing the power of creative destruction inherent in capitalism.

On the whole, I think Obama's playing this one right.

Sunday, March 29, 2009

The Final Four

UNC vs Villanova
Michigan State vs. UConn


Here are the bold predictions made on the site. Dan and Sam Shapiro both 0-4 in their final four.

Proud of the People of Fargo

A fine example of how community's are supposed to act in the face of natural disaster. Bully for you, Fargo. You betch'ya.

Saturday, March 28, 2009

Maureen Dowd Remains Ridiculous

Could someone please read this and then make a case for this woman having a column in the New York Times? She is beyond trite.

Charter Schools in DC

Charter schools in DC educate 36% of the students there and fill important gaps in a school system struggling to turn around years of benign neglect. Yet the education establishment, DC Public Schools (DCPS) and the teachers union all look at them as somehow antithetical to the mission of public education. DC's school age population has declined year after year, forcing authorities to close neighborhood schools that were severely under-utilized. Many charter schools popped up looking to take over the schools (or purchase them for reasonable prices), but the Mayor and DCPS decided to sell the buildings instead at market price--something few charters are prepared to do. Now the Mayor and DCPS are looking to change the formula for which charters are funded, a formula that would deal a blow to the desire of many charters to build capital accounts that would enable them to build or buy schools. It is time for the city to recognize its charters as vital parts of its public eduction mission and fund them accordingly.

Japan Takes Aim at North Korea's Missile

Looks like the North Koreans are moving ahead with their plans to launch a "satellite" atop a Taepo-dong 2 ballistic missile. This story describes something I've mentioned here before, a scenario in which the Japanese act to shoot down the missile, rather than the US.

The US and Japan have cooperated heavily in recent history to create an architecture of weapons, sensors and information that would enable forces from either nation to destroy ballistic missiles. Take a look at the two destroyers in the picture accompanying the story--you'll see the telltale signs of the SPY radar, heart and soul of the AEGIS Weapons System. What you can't see is the sophisticated network of communications systems that make up an information grid into which those destroyers plug, in order to gain fire control quality tracks.

I can see a scenario developing that goes something like this...depending on the trajectory of the missile, Japanese Maritime Self-Defense Forces (JMSDF) and US Navy forces are arrayed in such a manner as to give each nation's forces an engagement opportunity on the missile. JMSDF forces will be the primary shooters, with US in backup. The trajectory of the missile is very important, as it (and the position of the allied forces) will determine the number of engagement opportunities. The difficulty here is in the "kill assessment" process--that is, will there be sufficient time (and kinematics) to support a subsequent engagement if the initial shooter is unsuccessful? Ultimately, such a coordinated response might require interceptors from both nations to be in flight simultaneously, with the back up missiles command destructed in the event the primary missiles are successful.

You can be sure very smart people at the highest levels of the JMSDF and the US Navy are working hard to create a concept of operations (CONOPS) for this kind of thing...that is, if our governments have the will to carry it out.

Obama and Afghanistan

The President announced his new strategy in Afghanistan yesterday, and it is one that Republicans and conservatives can support. Clearly benefiting from the breathing space afforded by the successful surge in Iraq, Mr. Obama seeks now to ramp up our efforts in Afghanistan on all fronts. With rhetoric sounding a lot like that of the previous occupant of the Oval Office, the President is very much moving in the direction upon which he campaigned, treating Afghanistan (rather than Iraq) as the central front of the war on terror (whoops, overseas contingency operation).

Good and smart people disagree on this strategy. Many believe it is time to stop the bleeding in Afghanistan and slowly disengage. That may prove to be the case, but I don't think it is the case now. Given our efforts in Iraq and the strains placed on our land forces, Afghanistan never got the kind of attention it deserved.

It is now put up or shut up time in the Democratic Party. We all endured the poetic waxings of Obama, Pelosi, Reid et al about the goodness and importance of the war in Afghanistan, mainly as a way of trying to force President Bush into retreat on Iraq. He did not, and Iraq is making a go of it even as we begin a controlled withdrawl. Now we get to see the truth (or not) behind the elevation of Afghanistan in the councils of Democratic war and policy making. Was it simply to look strong and attack a Republican President? Or did they really mean it? How will the Moveon.org crowd react to their President actually taking the Commander-in-Chief role seriously? The fractious nature of the Democratic Party will be on display for all to see.

Friday, March 27, 2009

Charitable Giving, Liberals, and Conservatives.

Joel Berg is a community activist in New York who runs "The New York City Coalition Against Hunger", and he's written an Op-Ed in this morning's Washington Post in which he accuses large charities and conservatives of "hyperventilating" about the damage that will be done to charities by reducing the charitable giving deduction on the wealthiest Americans. Putting aside for a moment the fact that much of the "hyperventilating" has come from the Democratic chairmen of the Congressional committees charged with writing tax law, I generally tend to agree with Mr. Berg. I don't think lowering the value of the deduction will matter to the overwhelming majority of wealthy people, and I find the tie of "deductibility" to one's tax bracket to be odd. That said, Mr. Berg and I arrive at our common views through very, very different processes.

The plain truth of the matter is that in ceteris paribus, conservatives give more than liberals to charity. Here's a story of one of the many such studies available, and I pulled it from that the propaganda organ of the RNC known as the New York Times. Where Berg goes off the tracks in his argument is in equating charity and government spending. Charity is the free and uncoerced donation of money to an organization devoted to functions and causes. Government spending is the redistribution of money removed from its bearers at the point of a gun (you think that is too dramatic? Try tax evasion; I guarantee the federal marshals who come for you will be armed). Berg's argument is supported by the likelihood that much of his funding COMES from the government (he's coy on this, citing only that he gets MORE of his private funding from middle class people than from wealthy--it would be interesting to see where ALL his revenue comes from--methinks there are a butt-ton of government funds coming in)rather than from charitable giving. Plain truth is, his "competition" gets more of its money from private funding--the competition being largely church groups.

Berg's support for raising taxes on the rich flows from the central idea that what he is doing is a proper function of government, and that the rich aren't paying their fair share. Besides, in his opinion, charitable giving is inefficient and benefits places rich people like anyway. My support for eliminating a portion of this benefit to wealthy Americans arises from a sense that the wealthy in America will keep giving anyway, and eliminating any difference in the level of deduction for anyone kind enough to donate to charity is simply the right thing to do. Berg just doesn't like the competition.

A Cautionary Tale: Uncle Sam on Your Board

Here's an interesting little story about the dangers of government/business (or in this case, government/government sponsored entity) "cooperation". It seems that last year's intercession by the Feds in the operations of Freddie Mac (and the Feds pouring of billions into the mix to prop Freddie up) has resulted in a situation in which management of the company (Freddie) wanted to complain to the regulator (SEC) about the role that the federal government was having in potentially holding Freddie back from profitability.

You see, the instrument of Federal control of Freddie (the Federal Housing Finance Agency) and the Obama Administration have made Freddie an essential part of the "Homeowner Affordable and Stability Plan" (I know, weird name). By forcing Freddie to "re-do" mortgages, Freddie sees a loss of $30B that has to be reported in its books. Fannie's management sought to disclose this fully in its annual report; folks at FHFP wanted them to water down the language so that it didn't appear that the Obama Plan was contributing to further losses at Freddie. Freddie threatened to go to the SEC and report the whole shooting match. They all settled on sufficiently watered down language.

What's going on here? For one thing, the weirdly private/weirdly public status of Freddie Mac (and Fannie Mae for that matter)--even before the Bush Administration intervened--was always a thumb on the scale where risk was concerned for Wall Street. In the back of investors' minds was a sense that the government would never let these guys fail, so whatever they are doing must be legit and the risk must not be too high. We know that wasn't the case. Secondly, the relationship between the Feds and the big federally sponsored mortgage corporations is even FURTHER muddied now that the feds intervened. You can't run a corporation that seeks to maximize shareholder value (which after all, is the purpose of corporations) that is also being run as an instrument of public policy.

What's to be done? One of two things. End the charade of the GSE's being looked at in any way as "private". Completely nationalize them and make them solely responsible to the federal government for executing a national policy of increased homeownership. OR--set them free. Cut all government ties. Completely privatize them and let them go see if the market will support the kinds of products they sell. At this point, I would support nationalizing them completely. We've had our dance with the silliness of homeownership as a birthright, and the ridiculous ends to which government, Wall Street and the public went in that pursuit have become manifest. If increasing home-ownership remains a government pursuit, it ought to fund that in its annual plan in and among all the other competing national priorities.

Thursday, March 26, 2009

The Bottom is in The Rear-View Mirror

Dow closed at 7925 today. Housing is coming back...from the dead. Retail sales in Jan and Feb were better than expected. I'm calling a bottom (actually, the bottom was about three weeks ago). Not saying we won't give some of this back in the weeks/months to come, but I believe the general trend is up. If you haven't already done so, it's time to get back in.

So the question is, why? What is it that is beginning to bring the economy back? I have a few thoughts:

1. Fast, concerted action by both the Bush Administration and the Obama Administration. This crisis was taken seriously by very serious people, and though there was a lot of confidence lost in the markets, investors overall seem satisfied that the people in charge recognized that there were serious problems.

2. Superb monetary policy by the Fed. Bernancke is one of the adults in DC, and he has been stellar. Encouraging liquidity has kept us afloat.

3. The stimulus. Although none of the money has gone out the door, there is an awful lot of money on the way out....and that has been priced in. I would suggest that if the President came out and said, "you know, I've looked at the economy and I think we should NOT spend $300B of the stimulus package and instead apply it to deficit relief" the markets would love it. All that borrowing is going to act as a brake on liquidity when the private sector actually begins needing it to fund expansion.

So....what are you buying?

Democrats and Taxes, Part 26

EJ Dionne, reliable lefty editorial writer for the Washington Post, has a column in this morning's paper extolling the virtues of the President's plans to raise taxes on wealthy Americans and to limit the value of charitable deductions for those same people. Dionne starts out with this proposition: "The debate on the budget is phony, the howling on deficits a charade. Few politicians want to acknowledge that if you really are concerned about long-term deficits, you have to support tax increases.". Perhaps. But what about controlling spending? Have we so thoroughly given up on entitlement reform and reining in the span of government that we must now all agree that the only way to deficit control is the raising of taxes? Or how about that old favorite, growing the economy! Yep. A growing economy provides the government with additional revenue for its operations. Should government arrest its own growth as the economy grows, deficits will naturally fall.

Dionne's insistence on raising taxes follows the Obama Party Line--that we must punish wealthy and successful Americans, that we must "share the wealth". Dionne puts it this way: "He's right that a large share of any increase should hit those who enjoyed the biggest income gains over the past decade." Yes, and they also were the ones who created jobs and wealth. But this is inconvenient to the narrative.

But here's a surprise for you...I don't mind the reduction in charitable contribution deductions. The wealthy folks I know who are big givers are definitely aware of that their contributions are tax deductible, but I would wager to say that very few of them care whether it is at 28% or 35%. They give because they can, and the tax deduction is icing on the cake.

Just for the sake of argument, let's do a thought experiment. Let's assume Dionne is right, that there simply is no way to close the deficit and expanding debt without raising taxes. What would a tax increase that I could support look like? Here goes:

1. Taxes would be raised on NO ONE until US GDP expanded for three consecutive quarters. Obama's continued rattling about "cutting taxes for 95% of working Americans" doesn't obscure the fact that his increases on the top earners cause more money to flow into the federal system and less into goods and services (total revenue). Raising taxes ON ANYONE in a recession is simply illogical and as was shown convincingly during the Depression, only lengthens economic misery.

2. Implement the cut in charitable deductions as planned.

3. Phase in a ten-year implementation of an elimination of the mortgage interest deduction, forever ending the protected status of a dangerously oversubscribed to portion of American investment portfolios. Take 90% of the benefit (to the government) and return it to taxpayers in the form of lower interest and capital gains tax rates.

4. Implement the tax increase on wealthy Americans as planned. Additionally, create a "Minimum Tax Liability" of 1%, thereby eliminating the HUGE portion of workers in our society who do not pay income taxes (estimates between 38% and 42%). The President (and his supporters) points often to payroll taxes paid by these people as evidence of the silliness of the "they don't pay taxes" charge. But let's be honest here--the payroll taxes they pay are fed into programs from which they will someday directly and individually benefit; in most cases, the total amount of that benefit (given increasing life expectancy) will dwarf what they ever paid in. Those without income tax liability are paying NOTHING toward national defense, veterans benefits, the space program, stem-cell research, early childhood education, green energy research or federally-funded student loans. Every single working American should have a stake in this country's future, and 1% is not too much to ask for that.

So there you have it. Am I advocating this approach? Has the CW lost his mind and suddenly decided that higher taxes are a good thing? Nope. I simply want to be on record as providing policy inputs for Democrats to ignore when the subject comes up.

Wednesday, March 25, 2009

Site Update

Our little experiment in conservative banter is a little over nine months old now, and it seems to be a going concern. In that time, we've had 8,444 different people (or IP addresses, more appropriately) visit from 95 different countries and all 50 states. Greenland has yet to provide a reader, a glaring fact when viewing readership against the backdrop of a Mercator projection of the globe. Sub-Saharan Africa is also notably unrepresented.

Don't forget to take the time to click on my sponsor blocks to see what they have to offer! There are a variety of sponsors keyed to the content on the site (Google picks them), and every time you click, it turns to money in my pocket! Stimulate MY economy!

An AIG Executive Votes With His Feet

I figured that this would happen; no, I'm being a little dishonest. I hoped this would happen. I wrote earlier about a dream sequence I had in which the Brahmin of Wall Street just packed up and quit, leaving to Tim Geithner and his Treasury Department bureaucrats the job of cleaning up the global financial crisis without their help. By this action (and the concomitant fall of the financial system) they would show class envious Americans who value their skills and talents not at all, just how wrong they were.

In an action not far removed from this dream sequence, Jake DeSantis, Executive Vice President of AIG's Financial Products Division has quit, and his letter of resignation points to his boss's lack of support in front of Congressional lynch mobs seeking to vilify DeSantis and his fellow workers. Coming up through the commodities arm of AIG, DeSantis had no play in the parts of AIG that were bringing the company down...a key graph follows:

"The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity — directly as well as indirectly with the rest of the taxpayers."

So a guy who did the right things, played by the rules, worked hard and then came into the failure part of the business to help save it--is now quitting. Jake DeSantis seems like a pretty good guy, and he seems like the kind of guy I want at AIG helping them get out of their own way. Instead, he'll now go to a company that isn't in trouble, and he'll help them get ever bigger and richer. C'est la vie, right?

Tuesday, March 24, 2009

The President's News Conference

Scroll down a bit to read the comments from tonight's live-blog of the President's news conference. I think he was better tonight than in the last one (shorter answers), but still too long.

We had an Anonymous (or Anonymi?) participating, which always makes it fun. I made a comment at one point that Obama was growing more human and beatable every day. This person cited Obama's poll numbers and indicated that I was misinformed, as I must have been following "Fox" polls. I did some looking, and found (non-Fox) polls that had George W Bush's popularity at this point in his first term HIGHER than President Obama's. I also found some polls that had Obama's slightly higher than Bush's.

But let's remember where each started, shall we? George Bush ascended to the Presidency after the most bitterly contested Presidential election in history. Barack Obama won a landslide. Yet they are now neck and neck (in comparison). Anyone who thinks these two months have been good ones for Barack Obama simply isn't paying close attention.

Senate Lays Down Its Pitchforks---For Now....

Responding to the cool response from the Obama Administration to the House effort to vindictively target/tax the AIG bonuses, the Senate appears to be slow-rolling the effort to lynch the AIG execs. This is good news, and it represents to some extent, the wisdom of the founders in creating two bodies in the legislature. One--the House--directly elected by the people every two years--is more responsive to the people, both the better and the lesser angels of their nature. The Senate--originally appointed to six year terms by the state legislatures--is there to temper the passions of the people so that wise policies might be adopted. Though the Senate today appears more like a House with longer terms (due to direct election), it is carrying out its envisioned function on this matter.

Red (Meat) Scare!

Terrible news of my impending demise here. I am generally prone to ignoring studies such as this one, as it seems that food studies take on a ping-pong like quality after a while (a glass of wine a day is good, a glass of wine a day is bad). That said, the SIZE and duration of this study has me taking notice.

I am a fan of red meat. Steak of any cut. Lamb chops. Pork chops, ribs, sausage. The Atkins Diet was MADE for me! But it seems that my chosen style of eating will counteract the more monk-like aspects of my life (non-smoker, non-drinker) and drive me to an early grave.

The good news is I love chicken, turkey and fish. Plus, living on the Eastern Shore gives me access to heavenly crab concoctions all summer long (as long as the crabs last!).

Obama Moves on Toxic Debt

Most of you have already seen Wall Street's euphoric reaction to the Obama Administration's FINALLY acting to attack toxic debt on financial industry balance sheets. This has been a long time coming (too long), but it represents one of the first true actions of the Obama Administration to attack what could ultimately be the single most difficult impediment to overcome in our economic recovery.

One significant argument in favor of this plan is that Paul Krugman hates it...thinks it just isn't quite socialist enough.

Live Blog the President's News Conference Tonight!

The President will hold a televised news conference tonight at 8PM, and we'll live-blog it here on the CW.

Sunday, March 22, 2009

#1 UVA 16---#7 Johns Hopkins--15---Men's Lacrosse

...and the UVA baseball team is #7 in the country....and the men's tennis team is #1. Springtime seems to be good for the Hoos....

Amateur Hour at the White House

I, like many others, was impressed by President-elect Obama's energy, efficiency and wisdom as he began to assemble his team in the two-and-a-half months after his election. While I clearly differed with most of them ideologically, I believed them to be competent and experienced.

Now two months into the administration, I believe the early promise of efficiency and effectiveness is not being lived up to, and I believe most of the wounds are self-inflicted. Additionally, the more things stumble along, the more I come to regard Chief of Staff Rahm Emanuel as proving himself not quite up to the job.

Issue 1--Staffing the Administration. Although it has been great fun to sass the Democrats on their perceived inability to pay income taxes as being the reason they are not able to fill key positions, I think the real problem is less nefarious than that. By making the elimination of lobbyist influence in Washington a higher administration goal than staffing it with qualified people, the President has effectively cut himself off from literally thousands of decent, hard-working, and expert voices to help guide policy. This policy is so misguided in its formulation and its application that even the registered lobbyists of non-profit organizations are finding it difficult to make it through the administration's vetting process. Furthermore, draconian restrictions on what potential administration figures can do AFTER their service is keeping others from serving. As popular as it is to demonize people who make a lot of money in America, many of them choose to put aside their high earnings and serve in government for periods of time. What makes this decision possible (they have mortgages and college tuitions to pay, too) is the knowledge that after their term in government, they can safely return to their lives and careers--and earning status. Obama's rigidity and attempts at purity are proving to be HUGE stumbling blocks to getting his administration off the ground. He needs all the help he can get from the most talented people available, and these people are being excluded.

Issue 2--Rahm Emanuel. Someone's got to make the trains run on time at the White House, and that person is Rahm Emanuel. Yes, it is early in the administration, and yes, mistakes will be made. But it is Emanuel's job to fix them, and it is his job to create an atmosphere of efficiency and competence. At this point, Emanuel is taking his lumps. The White House's treatment of British Prime Minister Gordon Brown, the lack of emphasis on filling Treasury Secretary Geithner's understaff, the non-sensical trial balloon to force wounded war veterans' private insurance to reimburse the VA for their care--even the President's appearance on Jay Leno--these mis-steps (Obama should probably not have been there in the first place) demonstrate a White House that is not yet up to speed and a Chief of Staff with great challenges ahead of him. It may be some time before the pliant lapdogs of the Washington Press Corps begin to raise questions about his performance, both out of loyalty to the man they elected and fear of reprisal. But the time will come.

Saturday, March 21, 2009

Sorry About This--Another Mortgage Rant

I know--I'm beginning to sound like a broken record. But THIS is simply outrageous. Clinical psychologist and "life coach" Monica Banks Greene bought her Largo, MD house three years ago for $440K and it is now worth $390K. She'd like to refinance, but under the rules put forward by the Obama Administration in its effort to help our most protected class--homeowners--she hasn't enough equity in her home and she is too "upside down" to qualify for federally sponsored refinancing. Here's how the WaPost put it:

"That borrower, Monica Banks Greene, was ecstatic when she heard of the administration's effort to make refinancing possible for as many as 5 million households with little or no equity in their homes. The plan targets borrowers such as Greene who are on time with their payments yet cannot refinance because their home values have plummeted.

But Greene remains stuck in her old loan. Only borrowers who are no more than 5 percent underwater on their loans qualify for the program. Greene owes more than that. She bought her Largo house three years ago for $440,000. It's now worth about $390,000."


Here are Ms. Greene's words: "I make decent money. I have great credit, and yet I still can't qualify," said Greene, a clinical psychologist and life coach. "Now, I'm waiting again for a plan that works for people like me."

You want a plan, Ms. Greene? Here's one. Keep paying your mortgage on time out of your "decent" salary and shut the hell up. Oh, here's another plan--pay more each month toward your mortgage than is due and build equity--thereby getting yourself in a position in which a bank looks at you as a good risk (i.e. you've got skin in the game). Then, refinance. That she even considers it the government's job to create some kind of benefit for her bespeaks the deepening dependency state in which we find ourselves. That our government considers people like Ms. Greene (but who have more equity in their homes) worthy of help is also a travesty. Instead of worrying about how to help people refinance loans they freely entered into under terms they can presumably afford, we should be increasing the penalties--civil, criminal, and social--affixed to people who feel they can walk away from situations like Ms. Greene's. I want to be fair--she's not threatening to walk--but she represents an entire ideology that leads inescapably to that decision.

CBO Projects Higher Deficits

The non-partisan Congressional Budget Office has released a study of the President's budget blueprint and found that his overly optimistic growth projections coupled with vastly increased spending will accelerate our budget deficit--and our national debt.

Republicans will of course, make a lot of noise about this--and I suppose that given the perverse way in which Washington works, it is our time to do so. But a rational look backward will reveal that 1) Republicans haven't been shy about running deficits to prime the economy and 2) Republicans haven't been shy about vastly increasing spending.

Let's look at two recent recessions--Reagan's, and the George W. Bush's. Both took on higher deficits in a time of economic contraction, and both helped lead the country to higher growth. What is different about President Obama's approach is HOW he's creating deficits. Whereas Reagan and Bush drove them with tax cuts and moderate growth of government (too much under Bush for my taste), Obama is driving them with piss ant tax cuts to people who don't pay taxes and massive government spending increases in support of significant change in the relationship of the government to the governed. Reagan and Bush fought economic downturn by putting more money in people's pockets to spend--Obama is fighting economic downturn by taking more money out of the consumer pool (higher overall taxes driving higher revenue) and spending it on his agenda. So--Republicans shouldn't be bitching about deficits right now, as deficit spending is THE way to go--they should continue to bitch about WHAT IT IS THAT DRIVE the deficits...useless initiatives designed to grow the reach of government with little or no stimulative value.

Secondly, Republicans have feet of clay when it comes to increasing government spending. Witness again, Reagan and GWB. Both seemed to claim that government should be smaller and less intrusive, and both grew the size of government through increased spending. There's no doubt about it, both of these Republican presidents GREW government. Where Republicans have a story here though is WHY Republicans grew government. In Reagan's case, much of it was driven by defense spending---part of a "spend the Russians into oblivion strategy" that called upon America's greatest weapon--its productivity--to convince them of the utter futility of their ideology. Bush grew government (at least at first) in an effort to combat another existential threat--nihilistic Islamic fundamentalism, a brand of which conducted attacks on home soil. Bush's efforts to bring order to the chaos of Homeland Defense and Intelligence--in addition to the choice of going to war in Iraq--have undoubtedly contributed to a doubling of the national debt in his 8 years. Some of Bush's choices (prescription drug benefit, for example) strike me as "Obamanian", but all in all, he drove spending up in order to protect the country.

What existential threats do we see President Obama responding too? Well, there's the civilization killer of non-digitized medical records (sorry GG, can't resist). There's the great national shame of college students actually having to take on debt to finance their education. And there is the near terminal problem of homeowners being upside-down in their mortgages. Yes, I know I'm being flip, and I know there are legitimate problems to which the Administration is responding in a positive manner (energy policy, for instance, is somewhere I'm largely aligned with the President). But the Administration's ADD is ridiculously and recklessly threatening to obviate any real benefit that would accrue to the things it is doing right (transportation, energy, SOME of the actions to arrest the mortgage issue).

Bottom line here: Republicans have used deficits to the country's advantage, and so should this President. His choices of how to get there however, defy logic, and it is here where we Republicans need to highlight our policy differences.

Friday, March 20, 2009

Taliban Justice for Bleeding Heart Journo

Hat tip to big brother Tom on this one....a delicious little story.

Seems Beverly Giesbrecht, a Canadian journalist with clear liberal leanings, found the world's response to 9-11 so disheartening that she changed her name to "Khadija Abdul Qahaar" and converted to Islam. Her new journalistic mission was to give voice to coverage of the Islamic world not provided in Western media.

Last summer she decided it would be a good idea to travel to Waziristan to cover the war in Afghanistan. Once there, the Taliban decided it would be a good idea to kidnap her. They are threatening to behead her if Canada doesn't come up with $2M.

As a human being, I hope she is released unharmed. But if she is, I fear we'll be treated to the standard liberal tripe about how the West has pushed the Taliban to such extremes.

Bonuses, Rank Populism, Class Warfare

The House's move yesterday to tax at a rate of 90%, bonuses (in excess of $125,000) paid to employees of firms who have taken government money as part of the bailout continues our slide into a dangerous level of class warfare fueled by populism, and our elected officials are doing nothing to stop it.

Very few people feel that large bonuses paid to executives in the financial industry are warranted; even fewer feel that they ought to be paid out of the taxpayers pockets. There are questions of the sustainability and appropriateness of the modern Wall Street compensation structure, and they ought to be asked and answered. This however, is not that time.

The more I read about the bonuses at AIG, the more convinced I am that very few of the folks who guided the Financial Services arm down the toilet are still working there. Hired since are a group of people--experts in the securities industry--who are unraveling some of the most difficult financial transactions there are. AIG's continued solvency is something the Federal Government OBVIOUSLY feels is important. Let's face it, the Secretary of the Treasury had Chris Dodd insert the language he did in the stimulus bill EXACTLY because Geithner understands the way Wall Streeters are compensated and exactly how mobile their skills are. Read this story about the scene inside AIG as their CEO testified--working there are a group of people who've largely come in SINCE the trouble, who are looking at this and saying "is it worth my time to work here anymore?". These folks can pack up and leave, selling themselves elsewhere on Wall Street where the government isn't acting like a petulant child and the compensation levels are commensurate with their skills and input.

Should Wall Street review its compensation structure? You bet. Should short term bonuses be the overwhelming chunk of compensation, seemingly undercutting a long term approach? Nope. But at some point, we've got to get ourselves around the fact that WE ARE IN TROUBLE, and WE NEED TO CONCENTRATE ON HOW TO GET OUT OF IT. Going back and passing vindictive taxes aimed at particular people will not contribute a lick to getting us out of this problem. If anything, it will exacerbate it. The President and those in Congress screaming for the scalps of these guys would do much better if they came up with a real plan to remove the toxic debt from the banks balance sheets--rather than bitching about how the folks are being paid who are working to get them out of the mess.

America doesn't want to hear it, but there is similarity in the compensation of Wall Street execs and those paid to our sports stars....they just seem to hold Wall Street in higher contempt. We see LeBron James, and we think, "well, I can't do that, and neither can most people I know--so he's worth it, and better yet, I'll pay to see him do it." Guess what? You and your friends can't do what those folks at AIG are working to do EITHER. People working in the financial industry there are the PROS, the ones who worked hard in grad school, churned out 80hour weeks at trading desks in their 20's, the people at the very top of their professions. That they make a lot of money strikes people as odd, or irresponsible. Strikes me as proper and logical. How that money is paid to them (bonuses) seems illogical, but the sums don't bother me a bit.

But the country is hurting, we blame Wall Street (couldn't be us, our addiction to debt, our inability to budget?--or Congress for goodness sake), and we want scalps. So the mob has assembled and it is marching to Connecticut.

Obama, Leno, and the Special Olympics

There's news out of President Obama's appearance on Jay Leno's show last night. Apparently, the President compared his bowling skills to what one might see at the Special Olympics. I learned of this story not through the Corner on NRO, and there is some talk over there about how he's lucky he's not a Republican, about how insensitive the remark was, yada, yada, yada.

Bottom line for me? It was kinda funny. And I surely don't want our side of the aisle to become the shrill, unfunny bunch of scolds that we all know the liberals have become over the years.

I think back to Monty Python's "Village Idiot Olympics"....a remarkably funny bit that clearly made fun of the mentally handicapped (or was it just making fun of the British? I digress.) I imagine such a bit if done today in the USA would be universally excoriated. I imagine that I'd just laugh.

C'mon Conservatives...laugh when things are funny!

Thursday, March 19, 2009

ADM Stavridis to SACEUR


Secretary of Defense Robert Gates has nominated ADM Jim Stavridis--currently serving as Commander of the US Southern Command (SOUTHCOM)--to be the next Supreme Allied Commmander, Europe (SACEUR). Jim will be the first Navy officer to serve in this role, and it is an inspired choice. I realize this will set my friends of the other services fires ablaze, but having Navy Officers as Chairman of the Joint Chiefs, SACEUR, PACOM, and Special Operations Command is a particularly good thing for the United States of America....

I've known Jim Stavridis for sixteen years and consider him a good friend. We met while he was a Commander working in the Pentagon and I was working as a Flag Lieutenant to a Three-star Admiral. A prolific writer, Stavridis had by that time been published in the PROCEEDINGS of the US Naval Institute several times, and his name was pretty well known to surface warriors. I stopped by his office one day as I passed by---just dropped in--and introduced myself. That one meeting was enough to solidify a friendship that has been of great personal and professional benefit to me.

What I haven't told you though, is that there are probably a thousand guys just like me--people who Jim Stavridis has taken the time know and collect. There simply is no more accessible flag officer, no one who takes the personal and professional development of the people he mentors more seriously or who does it better. In sixteen years, I have never heard him utter an ungracious word about another human being; nor have I heard one uttered about him.

Shortly after meeting him, Jim headed off to his first command--the USS BARRY (DDG 52). While there, the ship earned the Battenburg Cup--the award for the best unit (ship or squadron) in the Navy. The diary he kept there has recently been turned into a book that serves as a wonderful view inside the mind of a great captain. I kept a diary of my command also, thinking someday I might do the same thing...but it would almost certainly fall short of this wonderful effort of Jim's.

When he was serving on the staff of the Secretary of the Navy, the CNO was looking for a speechwriter. He had apparently interviewed a bunch of people, and hadn't been too impressed---so he asked Stavridis who it should be---and Stavridis tossed him my name. I got the job. Ten years later, when the CNO and the Navy's Deputy CNO for Strategy decided that they wanted to write a 21st Century Maritime Strategy--they asked Stavridis who should lead the effort and write it--Stavridis gave them my name, I got the job.

No matter how busy he was or who he was working for, Jim always had the time to sit down and have a cup of coffee. I was astounded at his memory and his capacity. My own family was unable to keep up with my dating life yet he always seemed to remember who it was I was dating--or who I recently had been dating. The true test of his capacity came when he was a three-star and he was selected as Secretary Rumsfeld's military assistant. I can honestly say that I'd never seen Jim so tired and run-down as I did while he was in that job--I always assumed that it was just the grind of working for Rumsfeld. Little did I know that it was more likely the fact that he was writing another book and learning Spanish in preparation for his appointment to SOUTHCOM. The last time I saw him was a year and a half ago during a Strategy Conference in Miami--hosted by him and his staff. He looked years younger, energized by his command role, the relationships he was making in Latin America, and the ties he was re-establishing in his home state of Florida.

Jim Stavridis is a national treasure, a true warrior-philosopher, statesman-poet. The United States could not ask for a better man at the helm of NATO's military operations, and Europe could not ask for a better American to represent our country.

Wednesday, March 18, 2009

Final Four Predictions

Ok, here's mine:

Memphis
Michigan State
Duke
UNC

UNC Champions.

What are your picks?

Obama and the VA Hornet's Nest

It seems the President and his people are considering a move to bill veterans' private insurance companies for continuing treatment of combat-related injuries---and oh my, what a hornet's nest they've walked into. Just wait until you see the veterans groups PR machine spool up and begin to criticize this proposal....they will wave the bloody shirt and make the President sorry he ever brought this one up.

I applaud the President for having the courage to consider taking on entitlement spending; I question his selection of initial targets. As we continue to prosecute two wars and his lapdog media presses for the "right" to cover the return of remains to military airbases, it seems odd that he would then begin to levy additional expenses on those who have been wounded in those wars.

As I've written here before, Veterans benefits are incredibly generous (and I am a willing beneficiary thereof), and I see reform here as a reasonable goal for a government seeking to control costs.

AIG, Bonuses, Populism and Recovery

I've been quiet about the AIG bonus kerfuffle while the media and the Congress fan the flames of righteous indignation, mostly because I while I found the whole dustup moderately interesting, I really didn't see it growing to this level. Now that it has, I suppose it is time for me to weigh in.

First, I think the whole thing stinks. I think it is execrable that a company that is getting so much money from the Feds (well, not really--getting it and passing it along to the banks it insured), a symbol of all that has gone wrong with the financial sector--would be paying out hefty bonuses at this point in time. The politics of it stink, the optics stink, and the message it sends stinks. I wish this hadn't happened, I wish this weren't a story, and I wish we were spending more time talking about the $2 Trillion that is getting spent elsewhere than the $170 million going to these bonuses. I think the American people have a right to question this, I think they are right to be angry.

That said, I find the "remedies" all worse than the "illness". As has been reported, it was Senate Banking guru Chris Dodd who inserted the language that protected bonuses agreed upon before February 11, 2009. So not only do we have the contractual obligations of the corporation who agreed to the bonuses, but also the protection of legislation passed by the US Congress. Dodd's all of a sudden religion on this subject is inconsistent with his legislative actions.

Next, I come back to an argument I've made here before--that what is required to steer us out of this mess are smart, incentivized people doing the very best they can to unwind these complex derivatives in order to eventually eliminate the bad debt from the books of the banks and other lending institutions. That they are paid bonuses to do so seems perverse given that in some instances, it was the actions of these very same people who helped get us where we are. But at the end of the day, we really do need these people, their skills, their experience and their wisdom to get us through this. If the Congress goes ahead with boneheaded schemes like special taxes on the bonuses of executives of companies who take government money (I've seen as high as 100% of bonuses above $100K), they'll simply drive smart, hard-working people from jobs in companies that desperately need the help to others who are doing much better. As far as I can see, there's no upside in denuding these troubled institutions of the people who will help them through this period--except perhaps quieting an angry mob, one that will only get louder when the system does indeed collapse under the weight of its own incompetence. All the talk of the folks at AIG being replaceable by out of work investment bankers and financial types seriously and irresponsibly undervalues the specialization required in this industry. A psychiatrist is an MD, but you don't go to one for a hip replacement.

I do think though, that the industry has to be a lot more judicious in actually targeting people for bonuses who are meeting performance goals. Although I have no inside information, I would speculate that there were just a few more pigs at the AIG bonus trough than were warranted.

UPDATE: Not that it really matters, but it appears Ruth Marcus agrees with me.

Tuesday, March 17, 2009

A Short on Shorting

I've expressed in this blog several times in the past a sense of unease about the concept of "shorting" a security; that is, essentially betting that a stock will decline in value and making a profit from that bet. In this useful article, the concept of shorting a stock is discussed, as are the benefits and drawbacks to the process. It is well worth the read in order to come away with a better sense of exactly what is at stake as regulators consider modifications to trading rules with respect to shorting.

Here's my take...I think shorting in the age of the internet is a generally bad thing. Information can be shared in an instant, including false and misleading information. Shorting creates a feeding frenzy that then acquires a momentum all its own. The re-imposition of the "uptick" rule (that says a subsequent short transaction may not be made until the stock price has risen risen) will not solve this problem, but it sure can help in slowing down the momentum of the frenzy once it begins.

One of the primary reasons put forward by supporters of shorting is that it allows investors to "express their skepticism" about a stock. I guess I thought that's what selling it was all about....

Please, if there are financial whizzes reading in...weigh in with your thoughts on shorting.

An Earmark Unmasked

I found this story to be insightful with respect to the ongoing debate about earmarks. As many of you know, I'm not a critic of earmarks...I defend them in many cases. My theory is that the "adds" process in the Federal budget is a relatively efficient way for the Congress to 1) exercise the power of the purse and 2) ensure that government revenue is spread around the country in as efficient a manner as possible. Some say that if the projects were "worthy", they'd have been funded in the budget submitted to the Congress by the Executive Department responsible...I don't have such a high level of confidence in the Teutonic efficiency of our Federal Departments, and so I don't mind the step in the process (yes, it really is just part of the process) that gives legislators the opportunity to add in projects they believe to be particularly worthy.

$767B for "stimulus"? $650B for "health care"? These are the things that get me excited about waste, over-reach and the remaking of our compact with the Federal government. $1M to help the people of Utah with a tough pest problem strikes me as a damn fine way to spend taxpayer money.

Sunday, March 15, 2009

Thoughts While Traveling (Part II)

2. Hemingway, Old Key West, Cuba. I was in this enormous fishing store the other day, and there in the middle was the fishing yacht PILAR, made famous in Hemingway's "The Old Man and the Sea". It had become a minor Hemingway museum, with lots of pictures, posters, portraits and the like festooning what was still (it was a 76 year old boat) a beautiful vessel. Looking at all those pictures of Papa, I envied him...that he got to experience Key West and Havana in the 30's/40's/and 50's--places that are now mere remnants of their former coolness. Kitschy and done up, the Florida Keys stretch out before you as a monument to the strip mall, spliced together with thin bridges and state parks. Havana may still have some of the old charm, but my sense is that 60 years of Communism has taken some of the bloom off the rose.

Where are the "way cool" places today, places where 50 years from now people will be saying "I wish I experienced that?". If I knew where some of them were, I'd visit them now. I'm not looking for "cool" as in "popular" or "pretentious"--I'm thinking about it in terms of uniqueness and stylishness, places where there is a vibe that seemingly belongs to that place and that place alone. If any of you have any suggestions, I'd love to hear them.

3. On my failings as a father, sort of
. Many of you know that the Kitten has two little girls, one 9 and one 7. Their Dad died when they were both under 2, and I guess at this point, I'm about as close to a father as they've ever had...though that isn't saying much, as I've found yet another thing that I really don't think I'm too good at. I grew up in a family with four brothers and a sister--we basically had someone to play with ALL the time---and that person was almost NEVER Mom or Dad. They just didn't DO that (at least not to my memory--though my family is free to chime in). Mom and Dad raised us--they occasionally did things with us, but the bottom line around our house was that the kids occupied themselves, and that complaints about being bored were met with statements like "read a book", something that I took them up with quite a bit. I now find myself utterly unprepared for a society in which it appears to me that most people expect that I am to be the playmate of these two lovely girls. I know I don't rise on the Kitten's list when i tell them "play with your sister" or worse yet, say "absolutely" when they ask if they can watch TV. I have no model for this role, I have no sense of how its done--worse yet, I'm not sure I have any desire for it. I couldn't WAIT to grow up when I was a kid (ask my brothers). I started drinking coffee when I was 8. I watched the Republican National Convention coverage on TV when I was 7. Plain truth is, I wasn't too thrilled with life as a kid when I was one--there was SO MUCH MORE out there for adults....and now that I am an adult, doing "kid" things now is even less thrilling.

Was in the Keys this weekend with two great families, each with a modern day giant of a Dad at the helm (I had huge Woody Allen like bouts of patrimonial inadequacy). The ladies left us to go shopping about midday today, and the three of us found ourselves sitting around a table enjoying a conversation. Toward the end of the conversation, one of the guys says to the two of us, "well, we probably ought to go and find something for the kids to do--they're awfully quiet up there--I'll bet they are watching TV." The wheels began to turn in my brain immediately. I said none of this aloud (of course--I'm not a Dad--I have no standing), but I thought, "Wait a minute--there are six children here between the ages of 5-9. I have a feeling that if properly motivated, they'll entertain themselves in fine form." I was enjoying this moment of adult conversation, and I couldn't see why it wouldn't go on for a good bit more of time. But this is not the way of modern fatherhood. The modern father sees television as much as an evil as his spouse does. The modern father creates treasure hunts, organizes games, builds forts....and the like. I'm sure my Dad did this stuff--but what made it special is that he RARELY did it. He was busy doing DAD things. Are there "DAD" things anymore?

Thoughts While Traveling

Hello all. I come to you this evening from the Admiral's Club at the Miami Airport. This is American Airlines' pay to play lounge, and it is really quite nice. Just had a killer bowl of chicken soup at the bar and a chicken Caesar wrap that was very tasty. I now have 90 or so minutes of sterile luxury to share with you, so I thought I'd share a few comments while traveling.

1. First of all--the reaction to the Jon Stewart post was more than I'd anticipated. Although most of the folks who read this are on the right side of the spectrum, I have a few longtime friends on the other side of the spectrum who look in now and then and provide me with their own commentary, either in person or through the blog. Apparently, I went just a little bit too far by criticizing Jon Stewart, and one of them seems to have signed off of the blog. I consider this unfortunate, because reading through the protest, he or she is clearly intelligent and has a lot to add here. But as is often the case when folks reach their limit, I think this person did a lot of piling on of their own biases and really didn't stay on top of what I was saying. That said, their response was very influential in getting me to think again about my post. Lots to address in it, but as far as I can tell, the argument is 1) Jim Cramer (and apparently all of CNBC) is an un-indicted co-conspirator in whatever criminal gallery is being assembled of those most responsible for the economic crisis we are in. 2) He made a lot of predictions that turned out to be wrong 3) Jon Stewart is a comedian and no one really thinks his show is anything but comedy and satire 4) whereas Cramer has a higher obligation to his viewers and 5) Stewart is right in what he's saying 6) Stewart is an equal opportunity satirist and therefore 6) I'm shooting the messenger.

The more I read this poster's words, the more I began to think that he or she had a point-or more properly, lots of points. More than any post since I started the blog, this one came closest to having me say that I just plain screwed it up and that what I wrote was wrong. Yes, Stewart does lampoon the Obama administration. Yes, he is just the messenger. Yest, Cramer made a lot of wrong predictions, some of them frighteningly wrong. I very nearly got to the point where I conceded....and then I simply couldn't.

Yes--Cramer got things wrong sometimes. But did he get things right? Has he made correct calls? Has he said things on his show that ultimately did come true? Not stuff like "the sun will come up tomorrow", but analysis that showed he knew what he was talking about and that his advice was worth listening to? I watch Cramer about as much as I watch Stewart--in both cases, the answer is once in a while. I find Cramer entertaining and I find his analysis often coherent and insightful. But at the end of the day, HE'S STILL GUESSING about most of the predictions he makes. This again, is the nature if investing.

Next--the timing can't be argued away. Stewart never lifted a finger against either of these two guys on CNBC---until they skewered the President. You can talk all you want about how much Stewart goes after people on both sides of the fence...but how often does he go after people who are going after political figures? Is criticism of politicians solely the purview of the Daily Show? How often in the past has he chosen to go after--in the manner he is here--ANYONE even remotely on the other side of the equation from a Republican or a Conservative? The point I'm trying to make here is that it is NOT IMPORTANT for THIS criticism of Stewart that he may be right about the things he's calling Cramer on (which he appears to be, as he has loads of video evidence----but wait---no video evidence of when Cramer got things right?). What is important is that he has chosen a SIDE here, and I think that his choice belies a clear policy/political preference that most of us on this side of the aisle have always believed he had.

The worst counter-criticism of all is that Stewart is an entertainer who does politics, and Cramer is doing really important stuff in an entertaining way---ergo, Cramer has a higher responsibility. I'm pretty sure Stewart CRUSHES Cramer in ratings, and I'm positive that Stewart dispenses with a lot of "news" on his show (in his own style)--so where is HIS responsibility? Did he have ANY responsibility whatsoever before he started his vendetta against Jim Cramer to check into how successful he's been? How many "good" calls he had made? No. It didn't matter. He had an ax to grind and he had a platform to grind it from.

So at the end of this over longish post, I find myself at a cross-roads...just as content as I was the minute I first published the post that it was worthy of comment, and also a little disappointed that someone who disagreed with me in such a thoughtful manner has decided not to visit the blog anymore. There you have it.

Friday, March 13, 2009

Advice to President Obama--US Attorneys? Fire Them All

President Obama is trying to figure out what to do with the US Attorneys spread out across the land. You see, the job of US Attorney has become increasingly MORE political (hard to believe, considering it is a political appointment). President Clinton fired them all in one day after taking office, and President Bush got rid of most of them. Then, President Bush fired a number of those he appointed, raising their hackles and those of many observers, including Democrats who saw the firings as blatantly political.

Here's the deal. The US Attorneys are the point persons to execute the legal priorities of the Administration in office. That's why the President hires them, that's why he fires them. When Bush fired the group (that got him in hot water), he did not have to put forward ANY reason--at all. They serve at the pleasure of the President. Now--if they were fired to interfere in ongoing prosecutions, that is illegal and should be prosecuted. But if he fired them because the were not pursuing indictments in cases he wanted pursued...well then that's plenty more than he needs.

As for President Obama...I recommend firing the lot of them and putting your people in, including re-hiring those you'd like to stay. You'll get criticized by opportunistic political opponents, but all you'd have to do is dredge up the statements of many of them in support of Bush's firings in order to justify your own. The President--no matter how much I disagree with him or his legal priorities--deserves to have HIS TEAM out there. And we should not raise it as an issue when he does start firing them.

Jon Stewart's in the Obama Tank

Jon Stewart is a funny guy and he has a funny show. But his recent rage against the CNBC machine is beginning to confirm something I've suspected all along in his show...that while he's happy to lampoon politicians of any party, he's particularly happy to mess with Republicans. A couple of CNBC guys begin to talk about the transfer of wealth and the destruction of wealth underway thus far in the Obama Administration, and Stewart becomes an attack dog for the Administration.

What strikes me as particularly ironic in this is Stewart's criticism of Jim Cramer for putting entertainment ahead of journalism. Funny, I seem to run across a whole lot of people who seem to have formed their opinions about news events and politics from what they see Stewart spouting on his 30 minutes per night--and I don't see Stewart owning up to putting entertainment ahead of journalism.

Slim Pickens

I, the Kitten and her kittens are lounging in the Florida Keys, so things could be light for a few days. I'll try and work on my work ethic while I'm here.

Thursday, March 12, 2009

Another Fawning Article on an Obama Administration Figure--Twofer Here--He Used to be a Reporter!

This is ridiculous. Twenty-year veteran of Time Magazine Jay Carney--now Communications Director for the Vice President--is cloyingly interviewed by the Post today. One of the questions.... "How is life on the other side?" Other side? Are you kidding me?

Was he in the tank for Obama before he took the job...of course not. Just ask his wife, ABC news reporter Claire Shipman. I'm sure you'll get the truth from her.

France to Re-join NATO

Here's some good news--France has decided to rejoin NATO as a full member (they pulled out in a fit of Gaullist pique in the 60's, remaining in the political structure, absenting themselves from the military). Sarkozy is proving to be an able statesman, recognizing that being "outside" the fence actually gave the French LESS influence than being on the inside. Of course, some will spin this as yet again more evidence of the world warming up to the Obamanation, but Sarkozy has been working this issue for his entire term.

WaPost Hit Job on South Carolina Governor

The Washington Post this morning performs a superb hit-job on South Carolina Governor Mark Sanford, the gist of the story being "this right wing ideologue fought the stimulus bill, and now he's trying to refuse to take the money--even while his state suffers worse than almost any other under the weight of the recession." Sanford is thought by many to be a contender for the 2012 Republican Presidential nomination so his actions have particular significance, especially to the echo chamber that is the fawning Obamedia. Perhaps my words will be just as skewed in the opposite direction, as I am a huge fan of Sanford's. But then again, I don't portray myself as balanced.

With respect to the stimulus, Sanford raised many of the same questions about the level of spending and the targets of the spending that Republicans and moderate Democrats raised. He is the Chairman of the Republican Governors Association, and so served as a rallying point for the 17 of 22 Republican Governors who did not support the stimulus.

What interests me is that Amy Goldstein did not seek to address WHY Governor Sanford would try to turn this money down (actually, he wants to use it to retire state debt; barring that, he'll try to turn it down). Clearly the only reason is that he is an evil ideologue intent on scoring political points with his base--because there can be no other logical reason. But what if there were? What if the $700M came with strings attached to it, strings that changed the formula and standards against which people in the State of South Carolina became eligible for unemployment? For example, part-time workers becoming eligible for unemployment? At some point, the federal money would go away, leaving South Carolina with the bill to fund a level of benefits that were not contemplated by the Governor or its legislature.

Some say Sanford is being hypocritical, crowing against the stimulus and then taking 90% of it for his people. I see no inconsistency here; there was a legitimate policy debate going on, and his voice was a strong one in opposition. The bill passed, and his citizens tax dollars are going to pay for it--so they should also benefit.

Goldstein casually refers to a "spat" the Governor had with the State's Economic Security Commission, as if his refusal of the money is somehow related to a personal vendetta. Again, even cursory research into the "spat" would have revealed considerable evidence of shabby/non-existent record-keeping and a thoroughly unprofessionally run bureau of state government that was not held accountable (under South Carolina's archaic state constitution) to anyone. She might have found that the State Economic Security Commissioner asked the Governor to request $146M in aid from the feds in early January of 2009, only to come back 3 weeks later and ask for $316M--all from the head of a state agency REFUSING to undergo a state directed audit of its operations.

It would be interesting for Ms. Goldstein and the Washington Post to head up to, oh, say--Michigan--and see if they could scare up one or two people out of work, community service organizations straining under the weight of the increased need, folks who had to turn to community food banks. Don't hold your breath though, because the Governor of Michigan is an Obama supporter, a Democratic Party darling, and a big fan of the stimulus (and the automaker bailout) because SHE CARES.

Tuesday, March 10, 2009

CW Video #3--On Personal Responsibility

A few thoughts on the moral crisis within the mortgage crisis. If you'd like to watch the Youtube Version (with some graphics here and there) go here. video

Obama and Stem Cells

Well, the horse is out of the barn. Instead of the moral clarity of the Bush approach to federally funded fetal stem cell research, we get the manufactured mumbo-jumbo of the guy who wants it all. This article is particularly insightful when it comes to the holes President Obama has created through which to drive giant research trucks. The President's full-throated condemnation of "cloning for reproductive purposes" contains the "depends what the meaning of "is" is" phrase for this young administration. Cloning for reproduction--bad. What about cloning for research? What about cloning for the creation of additional stem cell lines? This is left unaddressed, and that's the way the President wants it. In one fell swoop, the President has issued payback to the snake-oil salesmen in the fetal stem cell research world AND the pro-choice crowd. A political two-fer for a morally dubious President.

Obama to Slow World Trade

Not content to deal our own economy savage blows by larding social program costs on top of the effort to grow our way out of the recession, the Obama Administration now seeks to "fix" a fraying world trade system. How? Well by requiring more strings! Labor rules, global warming provisions, you know--the kind of stuff that really helps the deal get done...

Now is not the time to be throwing roadblocks up in the way of American business as it tries to sell its goods and services overseas. All of this "well intentioned" trade talk serves only to disadvantage our products in the global marketplace.

Video Update

Made a decent video last night, then a series of technical gremlins struck. I don't think it will get posted until Wednesday evening.

Sunday, March 8, 2009

Obama To Open Up Relations With Cuba

If true, this story is good news. The Cuban exile community in Florida has held our foreign policy captive long enough on this issue, and I'm glad the President is rethinking our approach.

I'll visit as soon as I possibly can. And smoke a beautiful Cohiba.....

Yucca Mountain Hop--Obama and The Nuclear Waste Storage Issue

Nuclear power produces a tad less than 20% of our nation's electricity, and there has been no new construction on a nuclear power plant in the US since the late 1970's. Two things keep the US from moving toward what many consider (me among them) to be a no-brainer solution to at least PART of our coming energy nightmare--the storage of nuclear waste, and the availability of capital for the considerable costs associated with building a nuclear power plant (once built, nuclear is a comparatively cheap source of energy.

The capital problem will begin to solve itself when the current financial crisis abates. Additionally, the Obama Administration missed a golden opportunity to guarantee the creation of thousands of high paying jobs in the nuclear power industry by not standing behind nuclear construction in its stimulus package. Interestingly enough, the President's proposed "Cap and Trade" system for penalizing greenhouse gas producers will go a long way to changing the economics of nuclear power, making coal and natural gas comparatively more expensive when the costs of carbon mitigation are factored in (nuclear is carbon-neutral).

More troubling however is the nuclear waste issue. This one should have been solved a decade ago, when the Yucca Mountain Repository was to be opened. We're now $7B into the construction of the nation's planned long term repository for spent nuclear fuel, and the President just de-funded it in his latest budget blueprint. Why? Because as a candidate for President, he pandered to the people of Nevada and their charlatan of a Senator (Reid) by supporting a closure of Yucca Mountain--all the while continuing to hedge on nuclear energy because of the problems with long-term storage. The recently turned Democrat voters of Nevada feel "unsafe" with the storage of spent nuclear fuel thousands of feet below the earth's surface, high above the water table, in one of the country's most geologically stable locations--while the rest of the country sucks it up as spent fuel accumulates in local storage on the grounds of the 104 operating reactors distributed throughout the country (near actual population centers, as opposed to 2 hrs from Vegas in the middle of nowhere).

Adding to this problem is the fact that what we call "waste" the French call "fuel". Why? Because the French re-process their uranium several times over and re-use it in their reactors (creating "waste" at the end of the process that is far less in mass than what we have to store, and far less radioactive). We do not do this, mostly out of a fear of "do as I say, not as I do"--because we don't want others to re-process--as re-processing has the potential to create weapons grade plutonium proliferation issues.

We should immediately consider a program of fuel reprocessing in this country--maintaining safeguards and leading the world in counter-proliferation. And we should put Yucca Mountain on the path to opening within the next ten years.

Given that the country's electrical demands will sky-rocket in the coming years, we will need to build out the country's electrical infrastructure--including additional generating capacity. Nuclear is a big part of that equation, and we'll never get there as long as the President and the majority leader close their ears to the truth.

Where Obama's Getting It Right: High-Speed Rail

There's a good story in this morning's paper about the Obama Administration's push for increased high speed rail coverage, especially the prominence of such projects in the President's recently released stimulus package. I am an unabashed supporter of increased high speed rail, both to move people and to make the movement of commerce across state lines even more efficient. The promotion of interstate commerce is one of the things the federal government is supposed to do, and beefing up this element of our nation's transportation infrastructure is a good move.

It was a lot of fun to make fun of Harry Reid for slipping $8B into the stimulus package for a high-speed rail line from LA to Las Vegas--but I can't get excited about a plan that makes sense to me, and that could spur the development of other lines like it in the rest of the country.

My interest in rail is two-fold. I believe we can move people far more efficiently in the Northeast corridor using high speed rail than by air--especially given the Northeast's bad winter weather. Secondly, we can move even more freight with greater efficiency if passenger and rail systems don't have to vie for the same track and rights of way.

The Obama Administration has this right, and we should be with them on it--especially making sure that the Federal Railroad Administration distributes the money in a way that makes sense to best leverage the advantages of rail.

Another Federal Housing Mess

We've all become familiar with Fannie Mae and Freddie Mac--and their place among those who contributed to our current financial crisis. Now let's take a look at the Federal Housing Administration (FHA), shall we? Seems once Fannie and Freddie got into way-big trouble, the FHA stepped up to fill the no money-down, low-income federally-backed mortgage business (like Fannie and Freddie, the FHA does not make mortgages, it buys them).

Now it seems the default rate at FHA is on the rise fueled in part by a lack of oversight by the agency and the rise of mortgage brokers who are either unfamiliar with or blatantly not following the agency's rules--problems that are clearly inter-related. Of interest here is the large number of loans that are being defaulted upon without even a single payment being made, which industry experts indicate is a sign of fraud or misrepresentation somewhere along the line.

One would think the FHA would be particularly sensitive to the qualifications of potential home-buyers in this time, and that its inspectors would look askance at applications from homebuyers who trip the "likely to default" alarms.

This problem isn't going to work itself out until we dismiss the growing notion that homeownership is a human right, and that everyone ought to own a house. People who live day in and day out one or two paychecks away from financial crisis ought not be homeowners. Renting is not dishonor.

Saturday, March 7, 2009

Half of All 2008 Mortgage Defaults in 35 Counties

Here's an interesting story from USA Today, demonstrating that over 50% of the 2008 mortgage defaults occurred in 35 counties in these United States. THIRTY-FIVE COUNTIES! Don't TELL me this mortgage crisis is a nationwide problem, a "could I be next" kind of thing. The facts just don't support it. I wish they had provided the names of those 35 counties--because I would have spent the entire night working to determine how those counties allocated their presidential votes in 2008 and what the prevailing political conditions are there. I'd be willing to bet there is a statistically significant correlation between the likelihood of a county showing up in the top 35 and the propensity to vote Democratic--just as I'd be willing to bet that at an individual level, those who defaulted on their mortgages were more likely to vote Democrat.

Some Articles Worth Reading

Here, here, here.

"Card Check" Made Simple

I've had a few conversations with friends who ask me what the big deal with Democrat pushed/Union based "Card Check" legislation, misnamed "The Employee Free Choice Act". Besides tripping the Democrat pushed/Union based algorithm in my internal processor, there are real and important reasons why this legislation is a dog. Ned Rice does a better job of explaining why than I ever could.

Friday, March 6, 2009

Who is John Galt? Tigerhawk!

Stop what you are doing...right now. Put aside 10 minutes and watch this video. You want truth told to power? Here it is.

Obama Rocks the Teleprompter

Finally, our President's absolute reliance on the teleprompter is getting coverage. Of course, Presidents of recent vintage have all used the teleprompter...but almost exclusively for major addresses. Our Orator-in-Chief uses them for virtually every televised speech he gives. Of course he's a gifted speaker--doesn't hurt when he's reading the words from a screen! We've all seen how much less impressive he is on his feet (the debates did quite a bit to humanize him), with all the "ums" and "uhs".

Let's face it...Barack Obama is an uncommonly smart guy, and he's a great politician. But he's scripted, he's stiff and even his "personality" is written into the speeches.

The more we see of him, the more human he becomes. And it is not confidence inspiring.

It's the Economy, Stupid.

Ah, the Clinton years....seems like so long ago...remember them? There was I believe, posted on the wall of their campaign style "war room" a sign reminding them to concentrate on fixing the economy..."It's the Economy, Stupid" is what it said. I have a feeling this sign went up AFTER their Hillary-care debacle early in the first term, but I can't be sure. What I can say, is that it is a slogan worth resurrecting by the Obama Administration.

Yesterday, the President held the his latest team building session, this time on Health Care Reform. Summoning doctors, insurers, politicians, business, labor--all the usual suspects, for a day of talk, talk, jaw, jaw on health care reform. The President is further attempting to create a $654B health care slush fund, something whose details will of course, be fleshed out later.

Republicans are amiable dunces in this whole process. They head on over to the White House, they participate in the focus groups, they stand and praise the President for getting them all together to talk....and then they will be ignored. When actual legislation hits the street, it will be noxious and over-reaching, and Republicans will cry "we weren't part of the process"....and then the Administration will roll the video of Republicans at the White House...part of the process.

It is time for the Obama Administration to stop treating the economic crisis as anything but job one, or even worse, an opportunity to ram home policy initiatives that have little or nothing to do with moving the economy forward. Liberals cried "horror" when Rush Limbaugh hoped out loud that Obama would fail....and folks like me said that we disagreed, that we hoped the President succeeded. As I watch this process play out, I still want the President to succeed--and I know that diluting his efforts on things other than economic recovery is a surer path to failure--something we all don't want.

Oh and by the way, we still haven't figured out a way to deal with the bad debt on the Wall Street books--the single biggest impediment to recovery that there is.

UPDATE: Read THIS Krauthammer editorial from this morning's paper....he says it all so much better than I can...

Private Money to the Rescue?

Story here about ideas being generated that would entice Private Equity and Hedge Funds to part with some of their money to invest in government backed securities--with the government mitigating some of the risk. Necessity is the mother of invention, and we're starting to see a lot of stories like this, novel ideas about how to un-gum the credit markets and get capital flowing again. I remain hopeful that we will figure something out.

Thursday, March 5, 2009

Guantanamo: An Interesting Solution

So, we've got a problem in Guantanamo. See, there's a little prison there full of characters that we can't convict in civilian courts (probably) but who we know are bad actors that we don't want let loose on the world again. Problem is, no one else wants them either.

Guantanamo is also a Naval Base, but it hasn't been used for that purpose for years--prior to its new life as a prison base, it was where we lodge Haitian boat people who tried to get to the US by sea. That we have a perpetual lease there really sticks in the Cuban's craw.

Had dinner with a good friend last night, a guy who wasn't born here in the states and so isn't burdened with logic traps that a native born might have. He said, "hey--why not just give the Cubans Guantanamo back--but they have to keep all the prisoners?"

Brilliance; pure brilliance. Secretary Clinton, are you reading?

Christine O'Donnell Running for Senate in Delaware


I attended a fundraiser this evening for Christine O'Donnell (here shown in a video from the Democratic primaries), Republican candidate for the Senate in the 2010 special election necessitated by Joe Biden's election to the Vice Presidency. Unable to simply appoint his own son to his seat (son Bo was headed to Iraq on Army duty), Joe was able to have the pliant governor appoint a pliant caretaker (Ted Kaufman) to the seat. Kaufman has already pledged not to run in 10

The scene at the fundraiser made me think of what it must be like in Iowa and New Hampshire for Presidential candidates, early on in the primary season. There were about 20 folks there and we all had a chance to meet and chat with the candidate. She then gave a short presentation on her recent Senate race with Joe Biden (he ran for both VP and Senator) and why she feels this seat is winnable. Her likely opponent will be Bo Biden, and the theme of Dynastic Politics is sure to be raised in this race.

Christine is genuine, smart, and upbeat. She's starting early, aiming to build a war chest so that she will become attractive to the RNC, PAC's, and the Republican Senatorial Campaign Committee...who can then bring in substantial resources. Establishment Republicans need to take notice; this seat is in play, and she is a viable candidate. Best of all, she can win without breaking the bank---something the Republicans will need as they defend a number of seats in 2010.

Iowahawk: Quite Simply, the Funniest Man on the Web

Exhibit A.

"Underwater" Mortgages; Someone Please Tell Me Why I Should Care?

Yet another in an endless series of stories bemoaning the existence of poor mortgage holders whose house is worth less than they owe on it. Wow! 8.3 Million headed to 10 Miliion--that's really too bad. But please, someone tell me why this is a meaningful statistic?

Some portion of these people are trying to sell their houses so they can move. I see their issue.

Some portion of these people got Macdaddy subprime's with ARM's that are now expiring into straight interest mortgages that they can't afford--and they can't re-finance because of the lower appraised value of the house. I see this issue (but have little time for it).

And some people (the bulk of this number, I would imagine) are simply unlucky enough to have purchased when they did at the price they did (we call this "risk"). They are not moving or planning to move, they are simply in an unfortunate situation. I have absolutely no time for these people (heard a lady on the radio the other day whining about her "interest only mortgage on a house now worth $50,000 less; it is just UNFAIR." Unfair? To whom?

But guess what? My Thrift Savings Plan is "underwater". So is my IRA. As a matter of fact, a goodly portion of my portfolio is worth less than I paid for it. Is anyone riding to my aid? Are there bailouts in the offing for me? Of course not--because the thought is absurd. All investments carry risk, including houses.

Wednesday, March 4, 2009

Bush Justice Department Memos

The Obama Justice Department has recently been releasing secret memorandums produced in the early days of the war on terror, memos that the Bush Administration had distanced itself from as the war became more routinely enmeshed in the national consciousness.

Although I have not read all the memos in question, what is generally reported is their expansive view of the power of the presidency to prosecute the war on terror, primarily derived of the Commander-in-Chief authority. One in particular has raised the "oh my" level of alarm from those who a) view Presidential power with a jaundiced eye and/or b) view George Bush's exercise of Presidential power with a jaundiced eye. Most--if not all--of the memos were penned by the liberal legal community's Darth Maul...aka John Yoo...a brilliant legal scholar with a definite idea of the constitutional prerogatives of the President.

Let's look at one of these memos in detail, shall we? Here is how CNN reported it:

"Among the documents from the Justice Department's Office of Legal Counsel (OLC) is a 2001 memo declaring that in terrorism cases the military may conduct searches in the United States without a warrant if approved by the president. We conclude that the president has ample constitutional and statutory authority to deploy the military against international or foreign terrorists operating within the United States," wrote John Yoo, then a deputy assistant attorney general. "We further believe that the use of such military force generally is consistent with constitutional standards, and that it need not follow the exact procedures that govern law enforcement operations."

That this opinion has raised eyebrows is to me, beyond Bush Derangement Syndrome. What this memo--in a meticulously researched, concisely written and superbly reasoned manner--asserts is that the President's Constitutional authority as Commander-in-Chief is not a power confined to wartime operations in other people's backyards. Invasion from the sea and land was a distinct possibility in a young nation when the Constitution was written, and the founders clearly wished to invest the executive with the vigor and authority needed defend the nation---even on its own soil. Many of the drafters of the document were indeed still drawing breath when the British sailed up the Potomac in and burned the White House. There was then and there is now a distinction made between the conduct of war and the conduct of law enforcement. The Constitution is purposeful in its protection of individual rights and liberties with respect to civil and criminal law, just as it is purposeful in granting to the President extreme and virtually limitless authority as Commander-in-Chief. Read the memo--the citations from the Federalist Papers give great insight into what the founders expected of the executive with respect to his war-making authority.

But you say, the war on terror isn't "really" a war. And besides, the Constitution and the Congress never meant for this to mean US troops operating inside the US. This is nonsense, as even a cursory reading of the Joint Resolution of September 14, 2001 reveals. Even if the Congress had not passed the Joint Resolution, the President's authority as Commander-in-Chief was then and is now sufficient to authorize him to use the armed forces to protect the nation when it is under attack.

Bottom line here? The Press, Democrats and some hearty libertarians want us to believe that the Bush Administration illegally expanded the authority of the President, and that all due haste must be made to return the office to its pre-9/11 boundaries. Nothing could be further from the truth. President Bush exercised powers he had all along, powers that I would dearly like for President Obama to guard jealously should he ever find recourse to them.

Elected Judges

An interesting case was argued before the Supreme Court yesterday, one involving the question of when a judge--in this case, an elected judge--should recuse him/herself from a case involving a campaign contributor. As usual, the liberals and the conservatives of the court took to opposite sides of the issue and Anthony Kennedy straddled the muddled middle.

Here's my view: I think the concept of popularly electing judges is a bad one--at any level. While appointed judges at some level of abstraction are beholden to those who appoint them (far less so with lifetime appointments), popular will with respect to judicial appointments should be exercised in a representative manner through city councils and state legislatures. Judges should serve for life or for fixed terms (subject to re-appointment). Popular elections expose jurists to all sorts of charges of conflict of interest (as we see from this case before the Supremes) and in general, turn service on the bench into just another elected office, rather than the position of great trust that it should be.

Tuesday, March 3, 2009

One of the Joys of Living in Metro DC

After work tonight, I stopped by the American Enterprise Institute to listen to a panel discussion on What William F. Buckley, Jr. Can Teach Today's Conservatives. The panel--Ramesh Ponnuru of The National Review, Charles Kesler of the Claremont Review of Books, and Chris Demuth of AEI, was superbly moderated by Arthur Brooks of AEI.

It was 90 minutes well-spent, with all three panelists offering first hand stories from their friendships with WFB and advice on how to move forward with the Conservative movement.

I need to do more of this stuff. There were about forty people there, including Bill Kristol, Kate O'Beirne (what a strikingly tall and attractive woman), Michael Barone and Steven Hayward. I chatted up Bill Kristol and Ramesh on the Blog, and because we had to give our "affiliations" when we asked a question, I of course proclaimed myself a blogger (Ramesh nodded knowingly when I mentioned The Conservative Wahoo--perhaps he's read it!)
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