Friday, December 30, 2011

Happy New Year?

A week ago a bank in the building my wife works in posted a sign "We will be closed for the winter holiday". Now their sign reads, "We will be closed for New Year's Day". If naming Christmas is unacceptable in today's multicultural world then why is New Years acceptable? It is not the Chinese new year nor the Jewish new year nor the Islamic new year. They all have their own calendars and numbering systems.

Until recently we expressed the date as AD for "amno domini" which is Latin for "year of our lord" based on a calculation of when Christ was born. Dates less than zero were "BC" for Before Christ. This has been relabeled "common era" so tomorrow night we will celebrate the start of 2012 CE.

The modern calendar has a lot of the same heritage as Christmas. The date for each came from Roman holidays. It and the Catholic Church are the two main Roman institutions continuing in the modern world. The current calendar was created by Pope Gregory XIII. Because it was seen as a Catholic calendar it was not adopted for centuries by protestant countries (England adopted the Gregorian calendar in the 18th century, Russia and Greece in the 20th century).

The Gregorian calendar is the most accurate in general use which is why it is the unofficial standard for the world but it is still tied to Christianity and Europe. You would think that it would be just as culturally insensitive as Christmas which is celebrated in many non-Christian countries (China and Japan to name two).

Maybe I shouldn't be pointing this out. I could start a war on New Years.

Thursday, December 29, 2011

Waiting for Reagan

Republicans still seem to be waiting for the next Reagan to appear. It isn't going to happen this election. Politicians like Reagan appear rarely - once in one or two generations and it takes far more than wanting to be Reagan to actually accomplish it. Barack Obama proved this. He expected to be a transitional president like Reagan or FDR. At best he has been an LBJ, creating an expensive new entitlement while polarizing the country.

If there is a new Reagan on the horizon he is probably a first-term governor of a large state. I can think of a half-dozen likely candidates but none of them have the experience or accomplishments for a presidential run. That is 4-8 years off.

In the meantime, I'd like to point out how hard it might be to recognize the next Reagan. The original one did not have a cake-walk to the White House.

California was a bit of a national joke while Reagan was governor. The idea of an actor running a state seemed preposterous. He was not really taken seriously until he bought airtime and addressed the nation during his run in 1976. He lost. The party was not going to force a sitting president out of office, even if he was unelected (Ford became Vice-President after Agnew resigned and President after Nixon resigned. 1976 was his first time on a national ballot). The high point for Reagan came at the Republican convention when he was nominated. A few minutes were set aside for a demonstration by his supporters. It exceeded the time allotted by an hour. Reagan's supporters were dedicated even if his candidacy was doomed.

Reagan's 1976 run caused some hard feelings. Ford dying believing that he would have won the election if Reagan had supported him.

While Reagan did win the nomination in 1980, George H. W. Bush made him work for it. Many Republicans worried that Reagan was too conservative and preferred the more moderate Bush. Plus the Ford supporters were still angry about 1976.

Polls taken during the Summer showed that voters were dissatisfied with both candidates. A theoretical challenger polled higher than either Reagan or Carter. John Anderson took advantage of that and ran as an independent. Anderson was the last liberal Republican and hoped to capture the dissatisfied voters. He probably did not affect the election - even if everyone who voted for Anderson had voted for Carter, Reagan still would have won.

The final polls before the election showed Reagan and Carter tied with a large block still undecided. Voters were still dissatisfied with both candidates. Several political cartoons that ran the day of the election showed the voters flipping coins to decide who to vote for.

It turned out that most of the undecided voters broke for Reagan. This was unusual. Undecideds usually break for the incumbent. Reagan always had a large percentage of closet voters - people who would not admit to voting for him, even to a stranger taking a poll.

Reagan had deep coattails and the Republicans took the Senate. This did not last. The economy entered a double-dip recession and unemployment hit a post-depression high. In 1982 the Democrats ran against Reagan and made huge gains in Congress and in state governments. The only Republican to challenge an incumbent Democrat and win was John Kasich and he was aided by redistricting.

The reason we remember Reagan so fondly is that he was able to work with a Democrat-controlled Congress and still pass a conservative agenda. Also, unlike the current recovery, the recovery in 1983 was robust. Unemployment was still high in 1984 but it was dropping fast and people felt good about their country and its future. Reagan also realigned the electoral map. The south went from being a stronghold for conservative Democrats to one for Republicans. Reagan was not able to reverse the growth of government but he slowed it.

None of the current group of candidates is likely to be able to match Reagan's successes. Even Reagan could not. There are no tools left to use. Taxes have already been cut, interest rates lowered and the deficit run up to unsustainable levels. Massive deregulation might help but it is hard to believe that Romney or Gingrich would want to shrink government enough to help and Ron Paul has no chance of winning (or getting anything passed if he won).

That leaves that group of governors. Several are charismatic and dedicated to reshaping government. One of them might be able to take up where Reagan left off. But they need a success on the state level to run on.

In the meantime we need to settle for the most electable candidate to prevent the Obama administration from permanently messing up the economy.

Tuesday, December 27, 2011

Our Non-functional Congress

The mess surrounding the payroll tax cut (technically a Social Security tax holiday) shows once and for all that Congress is dysfunctional. The Democrats' great triumph was to kick the can down the road - and not very far. The extension that was passes was just long enough for Congress to go on break and start bickering again. A two month extension will not stimulate the economy. Neither will a ten month extension beyond that. The amount of the cut (around $20/week) is too small to do any real stimulating.

The tax cut was originally sold as an economic stimulus but the economy continued to languish so it should have been allowed to expire. Yes, that would have raised taxes on most workers but consider the consequences of continuing it. This tax funds Social Security. Cutting it turned a small surplus into a deficit. The country cannot stop writing Social Security checks so the Treasury has to make up the difference by borrowing so this tax cut adds to the deficit.

The Democrats' solution to this was to make up the difference by taxing millionaires. That would probably be the first step in turning Social Security from a self-funded entitlement (albeit, one with a demographic time bomb) into an income transfer from the rich to the elderly.

There is the source of the deadlocks. The Democrats want to reshape tax policy to redistribute income. The Republicans simply want to raise the money needed to run government. The Democrats see the growing divide between the rich and poor as a problem that needs an immediate solution. The Republicans see government policy as an impediment to growth which will benefit everyone.

In addition to genuine disagreements about the role of government, the Democrats have decided that the path to success at the polls is to allow the Republicans to offer solutions for Medicare, Medicaid, and Social Security. Once the Republicans' plans are on the table, the Democrats can pretend that there is no problem and accuse the Republicans of trying to end these programs. The Democrats' insistence that the Republicans are trying to end Medicare was labeled the "Lie of the year" by Politifact. Politifact points out that the Democrats would be on solid ground if they said that the Republicans were trying to privatize Medicare. Instead, the Democrats use the description "end", accompanied by video of a Republican literally throwing an old woman over a cliff.

According to the book Confidence Men, the Obama administration began health care reform with the intention of controlling costs. After switching their focus to insurance reform, their plan for controlling costs evolved. It now consists of doing nothing as long as possible in the hope that the eventual imminent disaster will break the deadlock.

So, how did we end up at this point?

Congress has always been divided but for most of the 20th century both parties had liberal and conservative members.That changed in the late 1970s. Ronald Reagan established a new Republican coalition of conservatives, Christian fundamentalists (including anti-abortion activists), and libertarians. The party ejected liberals and welcomed conservative Democrats, especially ones from the south who felt that the Democratic Party had left them behind.

The Democrats controlled the House for generations. With the retirement of Speaker Tip O'Neall, the Democrats began using parliamentary tricks to stop Republicans from offering amendments. This lead to a more confrontational Republican party. Newt Gingrich won the position of Minority Whip by promising to be more aggressive. He lived up to this, going so far as to undercut President George H. W. Bush's tax compromise (to this day, Bush still thinks of Gingrich as a "bomb thrower").

In 1992 the Democrats won the Presidency and both houses of Congress. New Democratic members of the House were asked to swear that they would not work with the Republicans. Two years later the Republicans won control of both houses of Congress with Newt as Speaker.

While President Clinton took the "third way" as a moderate, the liberal wing of the Democrats fumed. Enough of them defected to Ralph Nader's 3rd party run in 2000 to elect George W. Bush.

Just as Clinton was a center-left Democrat, Bush was a center-right Republican. The Left fumed over such things as the war in Iraq and the Patriot Act. The fact that the Democrats did nothing to end these when they retook Congress in 2006 just made the Left more angry.

Just as eight years of Clinton's center-left policies revitalized the far left, eight years of Bush's center-right (plus a couple of months of Obama's far left government) revitalized the far right. Moderates from both parties have been targeted by their own party. The most prominent of these was Joe Lieberman whose lifetime voting records was 90% liberal but was pro-Iraq war.

Which brings us to today. Neither party allows moderates to chair powerful committees. Thanks to Gingrich, the Republicans are against any tax increases. The Democrats are against any changes that do not raise the tax rate paid by the rich. During the Super-committee meetings the Republicans offered a package that would have lowered the marginal tax rates while eliminating deductions with the result of raising revenue. The Democrats rejected this and anything else that did not include $1 trillion in new taxes on the rich.

Neither side has any room left for negotiation and, with an election approaching, each is afraid of making any serious proposals.

So, where does that leave us? At best, Congress will be deadlocked until the next election. Possibly one side of the other will win big enough to crush the opposition. The other possibility is that a less-polarizing Republican will win and be able to work with the Democrats. President Obama has already shown that he has no desire to work with the Republicans so a status-quo election would result in 2-4 more years of deadlock while the country's financial problems continue to grow.

Friday, December 23, 2011

The Economics of Scrooge

Slate recently published an article entitled "What I like about Scrooge" by Steven E. Landsburg. It offers up various of Scrooge's pre-redemption traits as admirable and worthy of emulation. If this article is to be believed, the spirits of Christmas did Scrooge and the world a disservice by reforming Scrooge. He was a better man as a miser.

Landsburg lays out his case:

Here's what I like about Ebenezer Scrooge: His meager lodgings were dark because darkness is cheap, and barely heated because coal is not free. His dinner was gruel, which he prepared himself. Scrooge paid no man to wait on him.

Scrooge has been called ungenerous. I say that's a bum rap. What could be more generous than keeping your lamps unlit and your plate unfilled, leaving more fuel for others to burn and more food for others to eat? Who is a more benevolent neighbor than the man who employs no servants, freeing them to wait on someone else?

We can see from this that Landsburg views the world as a zero-sum system. There is a fixed amount of everything and the only way that anyone can have more is if someone else has less. He expands on this:

Oh, it might be slightly more complicated than that. Maybe when Scrooge demands less coal for his fire, less coal ends up being mined. But that's fine, too. Instead of digging coal for Scrooge, some would-be miner is now free to perform some other service for himself or someone else.

{...} In this whole world, there is nobody more generous than the miser—the man who could deplete the world's resources but chooses not to. The only difference between miserliness and philanthropy is that the philanthropist serves a favored few while the miser spreads his largess far and wide.

All of this puts Landsburg at odds with leading economic theory. The whole idea of economic stimulus is that money, once earned, is spent again. The speed that people earn and spend money determines economic growth. When this slows then the economy contracts causing a recession or a depression. For the last four years, economic policy has been centered on encouraging people to spend more money. Economists devote their careers to calculating how to get the most benefit from spending. While they disagree on how money should be spent, they are unanimous that taking money out of circulation is the worst thing that can happen.

Landsburg even gives examples of this. His hypothetical coal miner could have made more money if Scrooge expanded the market. Instead he either has to look for alternate sources of income or just live without (which Landsburg would probably applaud). One wonders if Landsburg would appreciate the freedom of selling fewer articles?

Ironically, Scrooge's income depends on people behaving differently than Scrooge himself. Dickens never specifies what Scrooge does. He is often portrayed as a money lender but Dickens describes his business as being in a warehouse and Scrooge is familiar with the exchanges. Possibly he is a speculator, buying and selling commodities for a profit. Regardless, his income depends on demand for something - money, commodities, etc.

It should also be pointed out that Scrooge's behavior goes beyond simple miserliness. If Scrooge was solely interested in money then he would never pass up a free meal at his nephew's expense. A better explanation is that Scrooge was punishing himself for choices made in his youth. It was only after facing those choices and the eventual resolution that he comes out of his shell and becomes a friend to his nephew and employee.

So why did Landsburg write such an article? Possibly he is a devoted follower of Al Gore and sincerely wants everyone to live like Scrooge in an effort to conserve the planet's resources (a sacrifice that Gore himself is unwilling to make). More likely this was just an attempt to fit Slate's format of justifying counter-intuitive titles.

Merry Christmas

Tuesday, December 20, 2011

War on Christmas or on Christians?

A few years ago many (most) large retailers stopped using the word "Christmas". Instead they simply suggested that you might want to buy presents for some unnamed occasion. Even Christmas trees were relabeled "holiday trees" or "family trees". A search for Christmas merchandise on Walmart's web site helpfully corrected suggested "did you mean Holiday?". This was labeled the War on Christmas and pressure was put on retailers to go back to referring to December 25th as Christmas instead of the Winter Holiday.

This year I have seen a number of people on the left insist that there never was a war on Christmas. It was all an invention by Fox News. People who avoided the word "Christmas" only did it out of sensitivity to the many non-Christians among us who might feel oppressed by hearing the name of an important Christian holiday.

In prior years some of the more honest on the left have said that they have no problem with Christians celebrating Christmas as long as they do it in their own homes.

A recent column by Linda Chavez put this in perspective. Strangely, the column had nothing to do with Christmas. It was about the reaction to football player Tim Tebow who is known for praying in public. Chavez quotes Connecticut Rabbi Joshua Hammerman who wrote in Jewish Week:

If Tebow wins the Super Bowl, against all odds, it will buoy his faithful, and emboldened faithful can do insane things, like burning mosques, bashing gays and indiscriminately banishing immigrants.

I had forgotten that the left thinks like this.

Here is the background on Hammerman's column. Sometime in the last few decades a group of intellectuals decided that Christianity is an intolerant and destructive religion and, if left unchecked, it will inevitably lead to another Holocaust. Accordingly, public expressions of Christianity must be suppressed. Further, politicians with strong religious beliefs are to be feared.

Once you know that the left thinks this way then the war on Christmas and the attacks on Tebow are easily understood.

The strange thing about this belief is how strongly it is rooted in the left's consciousness. It colors their views of everything else.

The TV show All American Muslims is an example. This shows on TLC and is designed to convince Americans that Muslims are just like everyone else. Since a show about normal people doing normal things is boring, the ratings for the show are dismal. Sponsors have dropped the show which has caused an uproar from the left (which does not watch the show, either).

But here's the thing - world-wide, there is much more violence being done in the name of Islam than Christ but it is ingrained into the left that only Christianity is violent. That world-view leaves them unable to see anyone else as violent or intolerant. Any attempts to point out flaws in Islam or elsewhere are taken as examples of Christian intolerance.

Which leaves us with a group that actually is trying to suppress any public mention of Christianity including Christmas. Right now they are failing so their fallback solution is to insist that this was never more than an invention by Fox News. But every now and then someone lets their real feeling slip in public.

Thursday, December 15, 2011


A big recent political issue has been the XP pipeline. If this is ever approved, it will bring oil from Canadian tar sands to Texas for refining. Environmentalists have made several objections to the pipeline but most of them are hollow. The most commonly heard objection is the consequences of a leak. What is not mentioned is how many pipelines already carry crude oil and refined gasoline across the country. This would be one of many and would not represent a new hazard.

The real objection comes from James Hansen of NASA's Jet Propulsion Laboratory and the father of global warming theory. His followers want to keep this resource untapped forever. This will not happen. Canada has made it clear that China will take the oil if we do not.

The arguments in favor of the pipeline are that it will create jobs and that it would reduce the US's reliance on oil from dictatorships. Some supporters have taken to calling the pipeline "ethical oil".

All that is needed to start work is an ok from the White House.

Rather than offend either constituency, President Obama has put the decision off until after the election. This allows him to convince both camps that he will eventually side with them.

The House of Representatives has talked about forcing the issue by tying the approval to an extension in the Social Security Payroll Tax cuts. President Obama has indicated that he would veto such a bill. This gives you a clear idea of the President's priorities.

A similar controversy has erupted around fracking (injecting water and chemicals at high pressure into a well to increase production). This has been used for decades in shallow gas and oil wells. New technology makes it possible to drill into deposits far deeper than before. When combined with fracking, this opens up huge quantities of gas and oil.

Again, the main arguments against fracking are weak, especially since it is not new. Few people admit it but the real objection is, again, to ever recovering a hydrocarbon-based fuel and is driven by fears of global warming.

The White House has stayed out of this controversy but many Democrats have jumped on board with calls for an indefinite moratorium on fracking.

During his run in 2008, Obama said that he wanted to see energy prices increase. The easiest way of doing this is to cut the US off from domestic (or near-domestic) sources of energy. Imported energy is always more expensive.

But Obama has an election to win so he can't come out and say this. But, he and the Democratic leadership cannot hide their actions. If allowed, America will resume being an exporter of gas and refined oil (but still an importer of crude oil). The Democratic leadership is trying to keep this from happening.

Wednesday, December 07, 2011

Pearl Harbor 70 years later

Pearl Harbor changed my life. In fact, without it I would never have been born.

My father was the son of a Missouri farmer living in St. Lewis when the attack happened. He enlisted the next day and volunteered to be a fighter pilot. In the US military, you had to be an officer to be a pilot so they sent the pilot volunteers to college for an intensive degree program. My father was sent to Macalester in Minnesota. While he was there he met my mother who was also a student there.

As the war progressed, the Army (The Air Force was still the Army Air Corps) decided that it had more pilots than it needed. My father's medical status was reevaluated according to new standards and he was transferred out of pilot training and sent to California to be trained as a radio operator and waist gunner. My mother accompanied him and they were married there.

My father survived the war without injury despite a close call when his plane was hit by anti-aircraft fire and had to ditch at an emergency air strip.

After the war, my father used the GI Bill to finish the degree he started in the military and to become a physician. He wanted to practice in a small city and saw an advertizement for Zanesville, Ohio in a medical journal. It was just what he was looking for and they moved there in 1952. I was born a couple of years later.

So, a chain of events that began with the bombing of Pearl Harbor led to my birth.

I am not unique in this. The entire Baby Boom generation is a result of the disruption of WWII that began with Pearl Harbor. The war and the GI Bill probably did more than any other event to change America from an agrarian nation to an urban one.

It is hard to say what the world would be like if the Japanese had not attacked 70 years ago. FDR wanted to enter the war against Hitler but most of the nation was strongly isolationist. Japan was the closer enemy but Hitler was the greater threat. If Japan had not attacked us when it did, we might have entered the war too late. We might have ended up with a Europe dominated by Germany and the USSR or even just the USSR.

Considering the alternatives, Japan might have done us a favor by forcing us into the war. Not that this excuses the attack. It was an act of incomprehensible savagery and because of Pearl Harbor, the US embraced the war instead of being dragged into it.

Monday, December 05, 2011

Obama and Social Security

President Obama is trying to make incremental changes in Social Security that will eventually change it in fundamental ways. It started last year in the deal over extending the Bush tax cuts. Part of the deal included a cut in the "payroll tax". This is the term that the Obama administration uses for the tax that funds Social Security.

FDR's grand bargain worked like this - everyone who works pays into Social Security* and everyone can collect when they retire based on what they paid into the system. This gives the impression that Social Security is a retirement account which accounts for a lot of its popularity. Retirees feel that they earned their benefits by paying into the system their entire working life.

Social Security is actually a pay as you go system. For most of its existence it has run a surplus which is immediately lent to the general fund at interest and spent. Demographics say that soon, Social Security will start running a deficit and have to redeem the loans. Eventually it will run out of money and only be able to cover 70-some percent of its expenses.

By cutting the payroll tax, Obama pushed Social Security into deficit years early. It has survived the year by redeeming its loans (known as special bonds).

The payroll tax cut has not helped the economy much. Like the Making Work Pay Act, it's effect on the average paycheck is small enough to go unnoticed. Regardless, the Obama administration is making two efforts. One is to extend the tax cut and offset it with a surcharge on the rich (this time defined as people making at least $1,000,000 instead of $200,000). The other effort is the jobs bill. This would provide further cuts to Social Security and would cut the employer's share as well. This did not name any off-setting taxes but the bill calls for a tax increase on the wealthy.

If Obama is reelected and especially if he gets a Democratic majority in Congress then I expect to see this trend continue - shifting Social Security taxes from lower-wage workers to the rich. The reason for this is that many liberals consider the Social Security tax to be regressive. It is the same rate for everyone and it is only paid on the first $200,000. Anyone who makes more that that amount will pay a smaller portion of his income in Social Security taxes.

The outcome of this will be to remake Social Security into an income transfer system taking money from the rich and giving it to retirees. It will break FDR's grand bargain. The good news for conservatives is that this will make Social Security easier to reform. The current argument that "I paid into it so I earned my benefits," will be eliminated as it is turned into welfare for the elderly.

A change of this magnitude should be openly discussed instead of hidden behind the euphemism "payroll tax cuts".

* Note - under FDR's original system a lot of people including government and farm did not pay into the system. It was later expanded to include almost everyone although government workers still have their own retirement systems.

Wednesday, November 30, 2011

Newt? Really?

I never took Gingrich's candidacy seriously. Why should I? Some of his top staff members quit because they felt that he was not taking his campaign seriously. But he suddenly vaulted to near-front-runner status as the current anti-Romney.

What are you thinking, people?

Newt's main qualification is that he was speaker of the house for a while. He wasn't particularly successful and was forced out by his fellow Republicans. While he was speaker the government shut down twice. The rumor at the time was that Newt shut down government because he wasn't given special seating on Air Force One. This was false but the fact that the Clinton administration managed to tar him with it shows how easily he can be out-maneuvered.

Newt has so much baggage that he needs a porter. Romney switched positions on abortion. Newt switched on nearly everything. He supported a federal mandate on health care while Obama was still a community organizer. He made a joint statement with Nancy Pelosi about the hazards of global warming.

Newt's personal life makes Bill Clinton look like a boy scout. Clinton strayed repeatedly but he never left his wife. If Edwards and Cain have been disqualified from running because of their affairs, how can anyone support Newt? Electing him brings back the possibility of a new presidential affair. A lot of social conservatives will stay home or vote for Obama rather than endorse Newt's infidelities.

Newt has worse baggage. He has earned millions as a lobbyist for recipients of federal bailouts.

Newt describes himself as a historian although he left academia rather than publish original research. That makes him a guy who got a history degree by reading the books published by actual historians.

Newt has a long history of shooting from the hip. This often gets him into trouble. It would be better if he was not in a position of importance.

Tuesday, November 29, 2011

Climategate 2

A new set of emails from climatologists has been released. Like the Climategate emails from two years ago, there are no smoking guns but there is confirmation of what many skeptics believe. I admit that I have not dug through the archives so I am only going from the nuggets that others have found. From those, it is possible to make some conclusions:

1) The scientists who advocate action to stop global warming are sincere in their beliefs. They really do believe that catastrophic warming is going on.

2) They are under a lot of pressure from politicians who want simple yes-or-no answers. Politicians are trying to sell the public on drastic change that will affect the lives of everyone. They need to be able to say confidently, "The consequences of not taking action are worse than the actions needed to stop climate change."

3) The actual science is not as sure as the climatologists are claiming. Data sets that don't match expectations are dropped and figures are massaged. Some of this is because of political pressure and some of it is because they are true believers. If results come up "wrong" then there must be something wrong with the readings, not the underlying data. I remember doing the same thing in high school physics but we knew that our test equipment was unreliable.

4) The system as it currently exists prods scientists into being true believers. True believers find it easy to get grants. This makes it profitable to be a true believer. At the same time, there is some worry about what will happen if they are wrong.

5) The true believers questions the motives of skeptics. There is one email speculating on "undiscovered ties" between a noted skeptic and big oil. To the true believers, the truth is so obvious that skeptics must be ignoring it for money.

6) Because #5, climatologists are very reluctant to allow outside review of their work. Both sets of climategate emails contain discussions on how to get around Freedom of Information requests. Many climatologists refuse to let people they consider paid hit men to review their work. There is probably a  large amount of defensiveness, also since they know that they have fudged some of their figures.

In summary, we have an insular group who know that they are exaggerating their findings and refuse to let their work be reviewed.

Tuesday, November 22, 2011

Super-committee failure - who won?

As part of last Summer's debt ceiling extension bill, a super-committee was supposed to identify $1.3 trillion in deficit reductions by Thanksgiving. They didn't.

A lot of finger-pointing is going on about which side is to blame. The Democrats insist that the Republicans were trying to use the super-committee as a way to cut taxes. Republicans respond by pointing out that they made a serious offer which included $300 billion in new taxes. Democrats rejected this as too small. They also objected because it would have locked most of the Bush tax cuts in place permanently. The Democrats' best offer was for $1 trillion in tax increases accompanied by $1 trillion in spending cuts and $300 billion in new stimulus spending. The two sides started making progress a couple of weeks ago then collapsed after details were leaked.

So, who won?

Progressives are sure that they have. In fact, they are pretty unanimous in declaring victory. The reason for this was that, at times, the super-committee had talked about "going big" and fixing out of control entitlements (Social Security, Medicare, and Medicaid). The automatic cuts triggered by the super-committee's failure will leave those programs untouched.

President Obama also seems to be a winner. He kept the committee at arm's length. His main contribution was a sternly worded statement that they needed to produce some results and a threat to veto anything that didn't include tax increases. By keeping his distance, Obama wanted to look like the grown-up when compared with Congress's squabbling children.

The failure also helps Obama's message. He is already saying that the failure is due to too many Republicans in Congress who are unwilling to compromise. What he really means is that there are too many Republicans in Congress. We will be hearing that message for the next 11.5 months.

This is part of a larger pattern of avoidance for political gain. Everyone knows that the deficit and the entitlements are major problems but the Democrats refuse to address them. It has been a year since Paul Ryan issued the Republican suggestion for reforming Medicare. The Democrats promised a counter-proposal but never issued one. Instead they ran ads showing Paul Ryan shoving a grandmother over a cliff.

The Democrats know that no matter what reforms they suggest, a large number of people will see decreased benefits. Rather than risk losing the support of those people, the Democrats prefer to ignore the problems and criticize the Republican efforts to be responsible.

The failure of the budget deal means automatic cuts but those will not happen until after the next election. Most parts of Obamacare will not go into effect until the next election. The XP Pipeline decision has been put off until after the next election.

So, the winners are the people who want to put off tackling real problems as long as possible 

Thursday, November 17, 2011

So long to the Occupation

OWS overstayed their welcome by a few weeks. A month ago they were getting good press. The liberal commentators loved it. "OWS is twice as popular as the Tea Party" they bragged. But the mainstream press got tired of writing about the 99%. Then came a few weeks of stories about violence and filth. Public opinion changed.

A month ago the Occupiers were new while the Tea Party was more than two and a half years old. Remember that the Tea Party was fairly popular its first year. OWS's popularity fell off much faster. A recent poll asked: Do you have a higher opinion of the Occupy Wall Street movement or the Tea Party movement?
Occupy: 37% (-3)
Tea Party: 43% (+3)
That's not a good basis for a new party to match the Tea Party.

And that assumes that a real organization could be built on the OWS. There are inherent problems with that. One is that many of them believe that having leaders is wrong because everyone's views are equally valid. That is also why they use the jazz hands (known as up-sparkles) instead of cheering or applauding. Cheers and applause might drown out someone.

Another problem is that the basis of the OWS is that the government has been hopelessly corrupted by the 1%. The 99% are powerless so forming a political party is a waste of time.

Of course, some Occupiers are trying to create a party which has started a split in the movement, weakening it further.

The various Occupiers should have broken camp when asked. That way they could have kept up their narrative. Instead they resisted and tarnished their movement.

"Somehow, we lost the high ground, we lost the narrative," said Kalle Lasn, co-founder of Adbusters which organized the OWS. "Tactically, the moment was right to declare victory, have a big global party and come back swinging next spring."

OWS overplayed it cards. Conservatives should breath a sign of relief that the movement is pulling itself down.

Wednesday, November 16, 2011

The End of the Occupation

Earl Tuesday morning New York police broke up the OWS camp. Other camps have been broken up in the last few days. Michael Moore sees this as a coordinated action, possibly overseen by President Obama himself. I see it as the natural course of events.

Two factors converged to end the camps. The first was the increasing violence and health risk of the camps. In New York they had an ailment known as "Zuccotti cough". Drug-resistant tuberculosis is becoming associated with the camps, caught from the homeless who moved in with them. Drug use is common. The camps are becoming known for rapes and body counts. With all of this going on, it is hard for a mayor to condone the camps.

The second factor is that all of these problems made the mainstream news. Most sites began lumping all of the OWS coverage into a daily roundup that was seldom sympathetic to the movement. Without public support the camps were vulnerable.

Keep in mind that there is no free speech issue here. Someone cannot take public land and insist that the land it forfeit in the interests of free speech. The Occupiers planned on making their camps as permanent as possible. The light, nylon tents were to be replaced with heavier military tents for the winter. Possibly by spring they would be building solid structures.

Also, camping in public spaces is not a recognized part of speech. It was invented for this event. The Occupiers can still assemble in the parks, the just cannot camp.

Friday, November 11, 2011

OWS's biggest victim

The Occupy Wall Street movement has been protesting for a couple of months now. Their message (the main one) is that the government is controlled by the richest 1%. They also spent a lot of time complaining about student debt and capitalism. So, who have the hurt the worst? President Barack Obama.

The damage done to Obama is on several levels. OWS has gotten a lot of press. At first it was completely favorable and the movement had a high approval rating in the polls. At that point President Obama, Vice-President Biden, Nancy Pelosi, and other Democrats gave OWS their approval. As time has gone on, the various Occupiers have had violent confrontations with the police and their approval rating has dropped. It is too late for the Democrats to disown them. The movement is still popular with the far left crowd and any politician distancing himself from OWS will offend them. But the swing voters will react the opposite way. A politician who approved of the Occupiers will be tarnished in their eyes.

Obama has been engaging in mild class warfare since his inauguration but OWS has stolen his thunder on that. Obama wants to raise taxes on the rich by 4%. OWS wants to confiscate their money. This may help Obama with the moderates but it still makes him look weak.

Currently, when Obama isn't in Europe insulting the heads of France or Israel, Obama is on the campaign trail running against the rich. He is trying desperately to get his jobs bill passed. The trouble is that the press is bored with this and quit giving it any coverage. Instead the are covering the Occupiers. The worst thing that can happen to a politician is to be ignored, especially when that politician is on the campaign trail. This is where OWS hurts Obama the most.

The one thing that could hurt Obama even more is if OWS starts protesting politicians along with the Wall Street. OWS hates the bailouts and crony capitalism that defines the Obama economic team. The OWS is convinced that the government is being run for the benefit of the 1% and Obama is the head of the government. At some point they might decide that he is a big part of the problem.

Thursday, November 10, 2011

Culture Wars 2011

Getting an early start on the culture wars...

Wisconsin governor Scott Walker sent out a press release about the lighting of the annual Christmas Tree. This has the easily offended in an uproar. It seems that Walker is the first governor since 1985 to call a decorated evergreen a "Christmas Tree" instead of a "holiday tree".

To put this in perspective, this week also had news reports about the National Christmas Tree starting its journey to the White House where President Obama will light it.

So, Walker is playing to an extremist theocratic base and Obama is not, even though both are lighting official Christmas Trees. Obama is the 5th US president to light a Christmas Tree since Wisconsin decided that the term was too inflammatory.

I don't know about Wisconsin, but Ohio started calling its tree a holiday tree after the KKK sued to be allowed to erect a cross on the statehouse grounds. Being the KKK, it was not a religious cross. Instead it was white with epithets on it. That should have been enough to disqualify it. Instead Ohio dropped all references to Christmas. Apparently they believe that no one will realize that it is a Christmas Tree if we call it a holiday tree. It had nothing to do with other religions.

I am sure that some religious minorities will be offended by Walker's action, not because he did anything wrong but because they have been told that they should be offended. Here is an example:

The Madison-based Freedom From Religion Foundation has opposed the term Christmas tree, saying it offends nonreligious people and amounts to a government endorsement of Christianity.

The president of that group, Annie Laurie Gaylor, called Walker's decision rude and insensitive to non-Christians.

"The reason that it was turned into a holiday tree was to avoid this connotation that the governor chooses one religion over another," she said. "It's essentially a discourtesy by the governor to announce that. He intends that to be a slight and a snub to non-Christians, otherwise he would not do it."

The vast majority of America celebrates Christmas. A greater number of people celebrate Christmas than are Christians. No other religion decorates a tree in December. At the same time, decorated trees are not part of Christian doctrine. For Gaylor to say that it is alright to erect a Christmas Tree as long as we call it something else and that giving it its proper name endorses Christianity is hypocritical and downright silly.

Since people seems to accept Obama using the term, I can only assume that this is faux outrage by people who suffer from Walker Derangement Syndrome.

Tuesday, November 08, 2011

Occupy and the Libertarians

Hard-core Libertarians tended to hate President Bush. This is not surprising since he was a big-government Republican. He waged two wars, increased the rate of spending, passed a Medicare drug benefit, and the Patriot Act. Many Libertarians saw McCain as worse than Bush and decided that Obama was the lesser of two evils. They hoped that Obama was a pragmatic centrist who only talked liberal while winning the nomination. They figured that they could make common cause with the Democrats over social issues. They even came up with a name for this fusion: Liberaltarians.

 That didn't work out so well. Obama continued Bush's war strategies, increased spending beyond Bush's records, passed his own expansion of health care, and renewed the Patriot Act. It turned out that the Democrats looked down their noses at Libertarians, even when they had issues in common.

These Libertarians are at it again. Now they are suggesting making common cause with the Occupy movement. They reason that both groups are against bail-outs and crony capitalism. The disconnect is the proposed solutions. Libertarians see this as an example of a government grown too powerful and would try to cut it back. The Occupiers want an expanded government and an end to capitalism. Trying to reconcile the two movements is impossible. They may start at the same place but they are diametrically opposed on what to o about it.

The real issue here is Libertarians who want to be cool. In 2008, it was cool to support Obama so they invented reasons to do so. Now the Occupiers seem cool so they want to hang out with them. It appears that just being a Libertarian isn't enough. At the same time, the Tea Party isn't cool enough for them. The same people who want to embrace an anti-capitalism movement sneer at a grass-roots, limited government movement.

Enough is enough. It is ok to stop being a Libertarian. Go ahead and convert. But don't try to convince us that you are still a Libertarian. Any Libertarian who hangs out with the Occupiers is a Libertarian In Name Only.

Monday, November 07, 2011

The Strange World of Robert Reich

When the Greek Prime Minister announced a referendum on the debt plan, Robert Reich cheered. What matter if the world economy crashed? At least the people would get a say. And the evil bankers who were going to forgive 50% of the Greek debt would be foiled from their dastardly plot. He then went on to complain about the American bailouts and the TARP. His complaint was that Bush, and later Obama, said that it had to be paid and Congress voted the money. The people had no say.

Reich ignores that fact that there is no provision for a referendum in the Constitution. Funny thing about that since he swore to uphold the Constitution when he was sworn in as Secretary of Labor under the Clinton administration.

But that's small potatoes compared to his recent explanation for the Great Recession. Most people see it as a result of the housing bubble bursting and taking a couple of trillion of national wealth with it. But in Reich's version the problem is that the rich have stolen all of our money so that there is nothing left for the rest of us to spend.

He also strongly opposes any attempt at introducing fiscal sanity, anywhere. The Greeks borrowed so much money that they cannot make interest payments on the loans. Spain is close to that point and the US will be there in less than a decade at current trends. The rich just don't have enough money to make up the difference. The only serious solution to this is to cut spending.

Reich does not see this. He sees the need for more government redistribution and spending. He even marched with the Oakland occupiers as they closed down one of the nation's busiest ports - an action sure to hurt the average worker.

Friday, November 04, 2011

OWS and the WTO Riots

When the Occupy Wall Street protest began it was fairly popular. It had a strong message with the "I am the 99%" campaign. It looked quirky with the human microphones, jazz hands, communal dining and charging stations.

Things took a darker turn with the Oakland protests. The movement closed down the nation's fifth largest port. The protest quickly degenerated into a riot. Even Men's Warehouse which had a sign in their window announcing their support for the movement had their window broken and anti-capitalism graffiti scrawled on their building.

OWS is beginning to look like the protest movement of 1999-2001. This started in Seattle in 1999 when the World Trade Organization met there. At least 40,000 anti-globalism and anti-capitalism protestors showed up and trashed the city. Over the next year and a half meetings of the WTO, the International Monetary Fund (IMF) and the G8 were met with similar protests. The leaders of the movement made it clear that they were against these entities and intended to trash any city that allowed them to meet.

The terrorist attacks of 9/11 brought this movement to an end.

Now the seem to be back in a new form. OWS has its own set of issues but there is a strong overlap with the Seattle issues. Both are protests against world trade and capitalism with environmental and pro-union groups thrown in. In the wake of the 2007 economic crisis and bail-outs, OWS has different priorities but that is inevitable after a decade.

Public support for OWS has fallen. When they started they were twice as popular as the Tea Party. To put this in perspective, when the Tea Party was that new it had similar poll numbers but it took a couple of years for these to drop. In New York, public support for OWS is down to 44% with 50% wanting the government to end the protests now.

If OWS continues to degenerate into violence then it will totally discredit itself before it has time to become a political force.

Wednesday, November 02, 2011

OWS and the Homeless

The Occupy movement is having to come to terms with the homeless. The Occupy camps is a draw for the homeless with free food and the promise of less crime than normal homeless camps (there have been reports of theft and violent crime including rape at the Occupy camps). At the same time, the homeless add numbers to the camps which is important as winter approaches.

But, there are problems. The homeless are not part of the movement. They are just opportunists. They may add numbers but they dilute the message. If the homeless begin to outnumber the Occupiers then the movement will lose credibility.

Many homeless have mental problems or engage in substance abuse (which is why they are homeless in the first place). They may also be contributing to crime in the camps, especially theft.

There is a poor fit between the Occupiers and the homeless. The Occupiers may not be the 1% but, with their smart phones and other gear, they are not in the bottom 50%, either. At minimum, they aspire to be in the top 10%.

There is also a disconnect between the protesters goals and the homeless. OWS is all about income redistribution but they do not seem ready to redistribute their own wealth to those with nothing. This is a dilemma. Any attempt at pushing the homeless out of the camps makes a mockery of their redistributionist demands. "Tax the rich and give it to us!" is not an inspiring message.

Tuesday, November 01, 2011

Cain and the Sexually Threatening Black Male

Twenty years ago Clarence Thomas seemed headed for certain confirmation as a Supreme Court justice. Anti-abortion activists were upset since they were certain that Roe v Wade would be appealed and Thomas would vote to overturn it. Something had to be done to stop his confirmation.

Acting on behalf of the NOW and other women's groups, Senators Kennedy and Metzenbaum leaked secret testimony from the judiciary panel. It seemed that a former employee of Thomas's had made accusations of sexual harassment. The committee had dismissed them. There was no corroborative evidence and the employee had felt comfortable enough working with Thomas to follow him to a different job. Never the less, the accusations were leaked and, in an unprecedented action, the witness was brought back to testify before the entire Senate (an the nation on TV). When Thomas's turn came he called it a "high tech lynching".

Thomas was qualified to be on the court so this was an attempt to "Bork" him. The term comes from a prior confirmation battle. As with Thomas, the goal was to keep a qualified candidate off of the bench because of his expected vote on abortion. In Robert Bork's case, he was unfairly portrayed as being outside the mainstream.

Thomas was a victim of a decades old stereotype that black men should be feared because they have a stronger sex drive. In the racist South, black men were often lynched on the slightest hint that they might have touched a white woman.

Nearly a decade later, President Clinton had sex with a young intern in the White House. Conservatives wanted to know where the outrage was? Feminists admitted that the outrage over Thomas had all been show. One feminist leader was quoted as sayign that she would be willing to give oral sex to Clinton for keeping abortion legal.

But, the Thomas accusations dramatically changed the definition of sexual harassment. Previously it meant a supervisor pressuring a subordinate for sex using threats of being fired or offers of promotion. After the Thomas confirmation, it meant anything that could make an employee uncomfortable. Some women complained about men engaging in locker-room behavior in their presence. Other women complained about men stopping this behavior when the women got close. There was no clear-cut standard for behavior.

That is the period that Herman Cain is accused of harassing women. The fact that the restaurant association he worked for paid settlements means little. With a complete lack of standards, accusations were impossible to fight. All accusations were treated as valid. The only standard was that a woman felt uncomfortable. The fact that she filed a complaint was proof that she felt uncomfortable. It appears that in Cain's case, the complaints were filed and settled without him even being aware.

Which brings us back to the image of the sexually threatening black male being used against a conservative. If this sort of accusation had been brought against Barack Obama, the accusers would have been labeled racists. As with Clarence Thomas, the goal is not to enlighten, it is to disqualify by any means.

Friday, October 28, 2011

We are the 98%?

In today's column, Eugene Robinson is writing about the income gap between the top 1% and everyone else:

Three decades of trickle-down economic theory, see-no-evil deregulation and tax-cutting fervor have led to massive redistribution. Another word for what's been happening might be theft.

Pretty strong words. The thing is, entry into the top 1% is fairly low. $400,000 qualifies you. I don't know how much Mr. Robinson makes but you would think that a nationally syndicated columnist and Pulitzer Prize winner would pull down at least that much.

So, Mr. Robinson, what made you decide to start stealing from the 99%?

Then there is Michael Moore who insists that he is not one of the 1%. He seems to be saying that the studios do not allow him to make any money. Moore's last movie (Capitalism) grossed $34 million. The one before that (Sicko) grossed $69 million and only cost $9 million to make. His top-grossing movie, Fahrenheit 9/11 grossed $222 million on a budget of $6 million. In addition to that, he has written some best-sellers. Moore lives in a multi-million dollar condo on Central Park. His kids attend an exclusive private school. According to IMDB, he travels by chauffered limo. In what world is he not part of the rich?

I won't even go into the Hollywood stars who express support for the Occupy movement. Or the multimillionaires at Apple who sell OWS their expensive toys.

It is possible that these people really don't see themselves as being rich. More likely, they distinguish between deserved and undeserved wealth. Or they distinguish by attitude. Wealth is ok as long as you support redistribution. The big question is if they support having their own money redistributed? Since Michael Moore insists that he is not in the 1% and talks about how little money he gets, I am betting that he does not want to see the government take most of it away.

Let us not forget the bottom 1%. The cooks at OWS got tired of preparing food for the homeless - the people who have no money - and decided to have a few days of brown rice. Presumably the protestors will go buy their meals at the restaurants while using the rest rooms there. How's this for a new slogan for OWS: "99% of the population controls 100% of the money. Screw the homeless. I am the 99%."

So we have the 98% who want the top 1%'s money but don't want to share with the bottom 1%. Plus people who are in the top 1% but still seem envious of the top 0.1%.

Tuesday, October 25, 2011

Global Warming Settled?

Global Warming is finally settled science. At least that's what Eugene Robinson says.

For the clueless or cynical diehards who deny global warming, it's getting awfully cold out there.

The latest icy blast of reality comes from an eminent scientist whom the climate-change skeptics once lauded as one of their own. Richard Muller, a respected physicist at the University of California, Berkeley, used to dismiss alarmist climate research as being "polluted by political and activist frenzy." Frustrated at what he considered shoddy science, Muller launched his own comprehensive study to set the record straight. Instead, the record set him straight.

[...] The Berkeley group's research even confirms the infamous "hockey stick" graph — showing a sharp recent temperature rise — that Muller once snarkily called "the poster child of the global warming community." Muller's new graph isn't just similar, it's identical.

What Muller and the Berkeley Group did was to examine the data from as many weather stations as possible. They found that 2/3s of them show significant warming while only 1/3 show cooling. They parsed the data different ways, limiting themselves to weather stations classified as good, ones classified as bad, ones in rural areas, ones in urban areas. Their results consistently showed warming (except on those 33% that showed cooling).

So, is the argument over? It is for Robinson who wants to use this study to bash Republicans. For the rest of us, there are still many issues.

While it is represented as matching the IPCC's data, the Berkeley data does not. It shows two degrees of warming where the IPCC only found .5 degree. Muller dismisses this as inconsequential. His team did not study ocean temperatures and he is sure that is where the

The study seems to be presented in such a way as to emphasize the warming. It talks about warming since the 1950s but their own chart shows nearly a full degree difference between the 1930s and the 1950s. By starting at a low point, the amount of warming shown is exaggerated.

Robinson is wrong when he says that this confirms the Hockey stick. Again, Berkeley's charts show highs were within historic levels through 1980. Berkeley's charts begin at 1800 (with the invention of the thermometer) while the Hockey Stick was an attempt to chart historic temperatures going back 1,000 years. That extra 800 years is important since it contains a historic warm period. Without knowing how warm it was without the effects of carbon dioxide we have no way of evaluating current temperatures.

Muller does not mention the Hockey Stick in his column nor does the Berkeley web site mention it. Robinson got that reference from a Green blogger at the New York Times. If you look at Berkeley's chart and the Hockey Stick from 1800 on, you find that the two do not match very well.

The biggest issue is that the Berkeley study was limited to examining temperature readings. It did not assess theories about its cause or the limits to warming. Even the IPCC admitted that some of the warming was caused by the sun and other natural sources. That is why estimates of early temperatures are so important and so contentious. Physics say that there is a limit on the amount of hat that CO2 can trap. Global warming theory says that by the time we reach that limit, enough additional water vapor will be in the atmosphere to cause additional warming. Since this part is entirely theoretical, it is also contentious.

The Berkeley data also confirms that warming has slowed or stopped over the last few years. This is too small a period to make projections from, but so is 60 years.

The well-informed skeptic does not deny that warming has happened over the last two centuries. Prior to the Greenhouse theory orthodox climatology said that there was a Medieval warm period followed by a cold period known as the Little Ice Age which ended in the 19th century. The skeptic says that the warming since then is mainly the start of a natural warm period. Muller and his team have published nothing that confirms or disproves this.

Monday, October 24, 2011

The Occupiers and the Loss of Neutral Space

What happened to the idea of neutral space - places that we all occupy that are free of politics?

Over the weekend I went to a comic book and media convention. During a Q&A session with an actor, someone asked him what sign he would hold at an Occupy event. Another person identified himself as a member of the Green Party and asked what the actor thought about Republican cuts to PBS? Several other people were wearing anti- SB5 buttons (SB5 is the Ohio bill that strips union of some of their power).

Naturally, no one asked any conservative or libertarian questions or identified themselves as such. This is ironic at a comic book convention since superheroes have a very libertarian view of government. Regardless, this seems out of place.

I feel the same way when politics enter comic books themselves. A couple of years ago a black comic book character made a disparaging remark about a Tea Party rally.

Part of our social contract should include a clause that regular people can go about their regular lives without being involved in politics. There has always been some bending of this since yard signs are a traditional campaign tactic. But public spaces, places owned by the people should not be used to reflect the views of a subset. This is also true for public spaces that the public needs to use but are privately owned.

But, the purpose of the Occupy movement is to occupy public spaces. Granted the park they are occupying in New York is private but their drums carry beyond the park limits. In other cities the Occupiers have set up camp on public space.

This didn't start with the Occupiers in September. Union protestors in Madison Wisconsin spent weeks camped in the state house.

The point is to bombard people with the Occupiers' message 24 hours a day. This gives the impression that the Occupy movement is larger than it really is.

This is not totally one-sided. Two years ago the Tea Party took their protests to town hall meetings. The difference is that town hall meetings are meant to be political.

A return to civility would be nice but I don't expect it. With a failing economy and the need for long-term changes to entitlements, I expect things to keep getting worse.

Thursday, October 20, 2011

Occupy and Obama - Where's the Outrage?

The Occupy movement and it's related 99% movement insist that the government is working for the interests of Wall Street and the top 1% at the expense of the rest of us. So, why aren't they protesting against President Obama and the Democrats? Obama is a captive of big money and special interests. Consider:

In 2008 he became the first candidate since federal matching funds were introduced to forgo them. The reason was the he could raise (and spend) more money than the limits mandated by matching funds. He has already announced that he will do this again in 2012 and plans to raise an unheard-of $1 billion. A significant portion of that comes from Wall Street. In 2008, Obama took more money from Wall Street than any candidate ever before. For the 2012 campaign, he has received more Wall Street money than all of the Republicans combined. In 2008 Obama claimed that most of his money came from small donors but fact-checkers ruled this false. Most of his money came from a few big sources.

Obama's effort to manage the economy amount to a modern form of "trickle-down". Although the TARP was passed under Bush, Obama was deeply involved and half of the money was spent during his administration. Other programs such as the Quantitative Easing and QE2 were designed to push interest rates to historic lows in the hope that the big banks would increase lending. There has been little demand for this low-interest money outside of Wall Street so the banks and investment houses have used the money to enrich themselves. That is why corporate profits and especially Wall Street profits have been at record highs while the rest of the country is in recession.

The administration's answer to restoring confidence in the banks was to "stress test" them. The requirements for the stress test were lowered several times and were more concerned with giving banks a seal of approval rather than actually certifying their soundness.

Unions are a form of big business and major contributors to the Democrats in general and Obama in specific. At the same time, they represent a small (and shrinking) portion of the population. Despite this, more than half of the stimulus was targeted at unions, especially public service unions.

Obama's signature accomplishment was Obamacare. This started out as health care reform but ended up being health insurance reform. Obama but deals with pharmaceuticals, doctors, and hospitals to leave them alone if they supported his bill. Insurance got its own deal with mandatory coverage. This will allow insurance companies to cover such things as pre-existing conditions while increasing profitability. Insurance companies stayed quiet during the debate because they knew they would come out ahead if it passed.

Obama's second attempt at a signature accomplishment was increased control of previously unregulated markets. This passed Congress with bipartisan support but was gutted in committee by Barney Frank. Frank also has an ethically-challenged relationship with Fanni Mae and Freddie Mac.

So where are the anti-Obama signs?

Obama's rhetoric may have something to do with this. He talks about "fat cats" and taxing millionaires and billionaires but his actions are at odds with his speeches. People may be judging him based on his teleprompter rather than his actions.

Or it may be that the Occupy movement is heavily astroturfed and that Obama supporters are suppressing anti-Obama sentiment.

On the other hand, the fact that these people are gathering and protesting shows dissatisfaction with the current government and the Democrats control the White House and a branch of Congress. 

Thursday, October 13, 2011

OWS and It's Cheerleaders

The Occupy Movement continues to resist making any real demands. This is in contrast with their vow that they will keep protesting "as long as it takes". How will they know when they have accomplished their goals if they don't have any? Actually, there are some strong indications of what they want. They have settled on the "99%" message, that the system only benefits the 1% richest. The implication is that the government should confiscate the 1%'s ill-gotten gains and distribute them to the other 99% in the form of government jobs and forgiveness of student loans.

To sum it up, they see the problem as corrupt government and the solution as more government. Obviously that will not work and the organizers know it. So what they really want goes deeper.

Katrina vanden Heuvel, publisher of The Nation, explains their problem this way:

The protesters in the nascent movement have been criticized for being too decentralized and lacking a clear list of demands. But they are bearing witness to the corruption of our politics; if they made demands to those in power, it would suggest those in power could do something about it. This contradicts what is, perhaps, their most compelling point: that our institutions and politicians serve the top 1 percent, not the other 99.

Pretty strong words - there is no point in making demands because the system is too corrupt to be reformed. Others have been saying similar things. A few pundits have suggested that OWS is the progressive answer to the Tea Party but more have compared it to the Arab Spring. Keep in mind that the Arab Spring is not a reform movement, it is a revolutionary one. Thomas Friedman is sure that some sort of major world-wide shift is happening, he just isn't sure if it is threat-based or opportunity-based. Either way, he sees the current system as broken.

OWS has always had a revolutionary element. Its organizers include organizations devoted to socialism or communism and it has always been a movement against capitalism. Before its numbers swelled, it was hard to photograph them without getting a "socialism now" or "kill the rich" sign in the picture. More recently, some affiliated protests have begun calling for violent revolution.

So, OWS is calling for revolution and many pundits are cheering it on.

What these cheerleaders don't seem to understand is that they are part of the 1%. Membership starts somewhere around $400,000/year which includes all of the news anchors and every actor you have heard of. Michael Moore is supposed to be worth $50 million. Keith Olbermann signed a multi-million dollar contract with Al Gore's Current TV. Nancy Pelosi has endorsed the movement which is doubly strange since she is independently wealthy and a leader in the corrupt system that they want fixed.

I don't for a moment believe that OWS will be able to foment an actual revolution and before they contemplate it they should remember that our armed forces now have ten years experience in suppressing an insurgency.

OWS may turn into a movement like the 1960s and early 1970s. The hippies didn't bring about world peace but the civil rights protestors did make some real progress.

The Democrats shouldn't be too excited about a push for financial reform. In 2008 they got more Wall Street money than the Republicans got. The Obama strategy for reviving the economy has consisted mainly of pushing money at Wall Street in the hopes that it would trickle down to the rest of us. They don't call it that but that's what the TARP, the quantitative easings, and the other programs were set up to do. This cheap money isn't effective. It allows bankers to take loans at 1% and use the money to buy treasury bonds which pay 3%.

Even modest reform will hurt one of the Democrats' bases and will be a repudiation of the Obama administration's financial policies.

So, why is the left cheering this movement on?

Monday, October 10, 2011

Occupy Atlanta

Watch the clip from Occupy Atlanta here. There is no explanation but I think that the speakers keep pausing every few words while the crowd repeats was was said as a form of PA system. Still, it reminds me of this clip from Life of Brian.

Much of it seems like a bad parody of a leftist group. The organizer cautions people that applause is bad because it might drown someone out so they have to use jazz hands and they take a "temperature check" (not a vote) on statements that have been made. Then there is the statement that the whole point is that no one should be worth more than anyone else. I wonder if they ever watched this Monty Python Sketch? Regardless, they managed to tell a sympathetic congressman that he isn't important enough to be given any of their time (although the amount of time they spent debating it was probably longer than Congressman Lewis would have spoken). They even cheered the fact that they had proven that a Congressman is no better than any of them.

Friday, October 07, 2011

Obama and Occupy Wall Street

Democrats are hoping that they can join with the Occupy Wall Street (OWS) people and turn them into a left-wing Tea Party. This will be tough.

One big problem is that the Democrats in general and President Obama in particular have been co-opted by Wall Street. Democrats receive slightly more campaign contribution from Wall Street than Republicans do. Obama go a lot more than McCain. Obama also had several Wall Street insiders in the White House. According to Confidence Men, most of Obama's economic efforts were focused on keeping up confidence in Wall Street. That is why his finance reform ended up being toothless and promoting "too big to fail" instead of ending it.

OWS is calling for redistribution of wealth. While Obama talks the talk on this, the most that he has actually proposed is restoring the Clinton tax rates on a select part of the population. This will not cause the redistribution that OWS is demanding. I doubt that his December, 2010 deal that extends the Bush tax cuts won Obama any points with this crowd.

The biggest problem for the Democrats is that OWS has a lot of scary people. 9/11 Truther Van Jones is an organizer and International ANSWER has a strong presence. They are a subsidiary of the American Communist Party.

This is why OWS refuses to allow an official list of demands. They will lose America as soon as people find out how radical this crowd is. Many people have released unofficial demands. These not only demand an end to war and racial discrimination, they also call for forgiveness of all debt. That sounds nice until you realize that it would wreck the world's economy.

I'm sure that the OWS organizers are hoping that they can force Obama to the left. Groups like MoveON and the Daily KOS moved Kerry in 2004 but they have done as much as they can. Obama's own on-line organization made these obsolete in 2008. In order to move the Democrats to the left in 2012, they are taking to the streets.

This puts Obama in a bind. If he moves to the left he will lose independents. If he doesn't then he loses liberals. This worked for the Republicans in 2010 but the Tea Party is moderate compared to OWS. The Tea Party called for fiscal restraint after trillions were spent on bail-outs and stimulus. OWS is calling for unlimited spending.

If the economy was doing better then this would not be an issue but Obama needs every vote that he can get. Forcing him to choose between radicals and moderates will hurt him.

Thursday, October 06, 2011

Roe v Wade and the Thomas confirmation

20 years ago the confirmation hearings were being held for Clarence Thomas. His confirmation seemed assured until one of his assistants was called to testify. She told about him using coarse language and making the workplace unfriendly. Thomas was confirmed anyway but suddenly sexual harassment was the hot national topic. Ironically, sexual harassment was not the real issue in the confirmation hearing. Abortion was.

40 years ago abortion was slowly gaining acceptance. New York and Florida had legalized it and a teen-age girl "in trouble" might suddenly visit an aunt in one of those states. Had things been left alone the country probably would have come to terms with abortion or allowed it on a state-by-state basis.

Then, in 1973, the Supreme Court decided the issue nationwide in the case Roe v Wade. In order to justify their decision, they found a previously undiscovered right to privacy between a woman and her doctor. She might go into the office pregnant and come out without carrying a child but whatever happened during her visit was between her and her doctor.

Problem solved. No more national debate.

Except forcing a decision like this on people forced a counter-action. The Right to Life movement was born. They had two lines of attack. One was to amend the Constitution. The other was to pack the Supreme Court and try to have Roe v Wade overturned. The battle lines were drawn.

Changing the Constitution was always a long-shot and the likelihood of that happening have gotten even more remote. That left the Supreme Court as the battleground.

Since the 1980s, every Supreme Court nominee has been scrutinized for how he would vote on Roe v Wade. This peaked with the nomination of Robert Bork. Bork had a brilliant legal mind and was a obvious candidate for the Supreme Court. But, abortion-supporters worried that he was too brilliant. Since his views are fairly conservative, they feared that he would use his brilliance to convince other court members to vote against abortion. So, they did everything possible to discredit him. The irony is that he represented the winning side on Roe v Wade and much of the final opinion was copied from him. He had a vested interest in upholding Roe v Wade. It didn't matter. The campaign against him was so fierce that it led to a new verb - to be "Borked".

Since then conservative presidents have tended to choose blank slate candidates in order to give their detractors less ammunition. Thomas was an example of this. He had spent most of his career as an administrator rather than a judge.

Thomas's biggest asset was his sterling character. So that was where they attacked him.

The judiciary panel had already heard Anita Hill's complaints but they did not find her credible. If Thomas was so abusive then why did she change jobs to follow him?

But the NOW was sure that Thomas would be a vote against Roe v Wade so they wanted him stopped. So Ted Kennedy and Howard Metzenbaum started circulating rumors that something had come up in the private hearings that needed to be heard in public. The Senate broke its own confidentiality rules and had Hill testify. It didn't stop Thomas's confirmation but the following year was the "year of the woman" when a record number of women ran and were elected to office.

Several years later it came out that Bill Clinton had as president had gone far beyond anything that Thomas was alleged to have done. Where was the outrage? There was none. The NOW admitted that the outrage against Thomas had been manufactured. In fact, one NOW leader offered to give oral sex to Clinton for keeping abortion legal.

Wednesday, October 05, 2011

The Boston Tea Party and Occupy Wall Street

Think Progress has a piece showing that Occupy Wall Street is closer to the original Boston Tea Party than today's Tea Party. This is a rather silly statement. I will address their point but first I will go over the background.

After the French and Indian War, England decided to take more active control of the American colonies. It also decided to recover the costs of defending the colonies. This led to a series of unpopular acts. One of them was the Townshend Act. Prior to this, colonial governors were paid by the colonies. The Townshend Act changed this, paying the governors directly by the British government. It also established a duty to pay for these salaries.

The colonists objected to this change, mainly because it was imposed on them by Parliament. The colonists, led by the Whig Party, argued that Parliament only had the authority to tax people who could vote for it. Since the colonists could not vote for Parliament members, taxes levied on the colonies should be passed by the colonial government. Note - the Whig Party lasted until the mid-19th century when it combined with the Abolitionists to form the Republican Party.

While this was going on, the East India Company was having problems. It held a monopoly on tea sold in England but Parliament had raised tea taxes. This caused a drop in demand for tea (and an increase in smuggling). The East India Company was importing tea faster than they could sell it and had warehouses full of it.

In order to help the East India Company out, Parliament gave them a monopoly on selling tea to the Colonies. Because they eliminated the middleman, they could undersell smugglers while still paying the Townshend Duties. The East India Company ,in turn, contracted with agents who wold have local monopolies on tea sales. Tea ships were dispatched to New York, Philadelphia, Boston, and Charleston.

Because the tea still had the tax, the ships were turned back everywhere except Boston where the governor's sons were the agents who could sell the tea. Unwilling to see the tea sold with the tax, a band of patriots dressed as indians and threw the tea into the harbor.

For a longer account, see Wikipedia. Now, onto Think Progress's points. Their original post has explanations for these points:

1.) The Original Boston Tea Party Was A Civil Disobedience Action Against A Private Corporation.

2.) The Original Boston Tea Party Feared That Corporate Greed Would Destroy America

3.) The Original Boston Tea Party Believed Government Necessary To Protect Against Corporate Excess.

4.) The Original Boston Tea Party Was Sparked By A Corporate Tax Cut For A British Corporation.

5.) The Original Boston Tea Party Wanted A Stronger Democracy.

My response:

1) The Boston Tea Party was a protest against parliament in general and the Townshend Act in particular. There was also fear that granting a monopoly for tea to the East India Company would lead to other monopolies being granted. This was still a protest against Parliament's expanding powers.

2) The Boston Tea Party was a tax protest. If they had worried about corporate greed then they would have allowed the taxed tea to be sold since it was priced lower than smuggled tea.

3) The Boston Tea Party had nothing to do with corporate excess. It was a protest against Parliament.

4) The Boston Tea Party was sparked by crony capitalism. The whole deal was put together to help the East India Company. The East India Company did not pay taxes on the tea. The taxes were a sales tax paid by the consumer.

5) I'm going to agree with the last point, that the Sons of Liberty were for a stronger democracy, but not in the way that Occupy Wall Street means. The Sons of Liberty felt that they could only be taxed by legislatures that they voted for. Occupy Wall Street organizers have rejected voting as a tool of democracy and now insist that protests are "participatory democracy".

A few other points should be offered. It is ignorant to say that "the Original Boston Tea Party wanted...". The Boston Tea Party was an event, not a party. The participants were the Sons of Liberty. The correct usage would be "The Sons of Liberty wanted...".

The modern corporation had not evolved yet. The East India Company was closer to a partnership than a corporation. There were also government monopolies which simply do not exist today. Modern corporations just do not relate to any 18th century body.

The biggest problem with Think Progress's list how disingenuous it is. Every one of their points misstates history. It says a lot about the (lack of) quality of how American history is taught that they can get away with such an egregious misrepresentation of history. It says even more that employees of the New York Times were passing this along.

Tuesday, October 04, 2011

Occupy Wall Street vs the Tea Party

Yesterday I pointed out the things that the OWS (Occupy Wall Street) and Tea Party have in common - they both hate the cronyism between Wall Street and the government. Their differences are illuminating.

The Tea Party formed pretty spontaneously. It got its start when a commentator on CNBC suggested that people throw a new tea party in response to the government's most recent bail-outs. In retrospect, the spark that started the Tea Party didn't amount to anything. President Obama had announced a new program to help mortgage-holders who were having trouble making their payments. The outrage came from people who resisted getting so deeply into debt and felt that their tax money (plus debt accumulated) was going to subsidize bad judgement. The irony is that the mortgage-bailout program was a total flop.

The left assumed that the Tea Party was somehow an example of AstroTurfing (creating a centrally-managed campaign disguised as a grass-roots movement). They were wrong. The Tea Party was a real, wide-spread movement as shown by its success in the 2008 elections.

One of the hallmarks of the Tea Party is how orderly it has been. It has been a matter of pride for organizers that protests do not break any laws and that the protestors pick up after themselves. Politically it is a form of populist libertarianism, strongly influenced by the writings of Ayn Rand.

OWS has very different roots. It was planned weeks in advance by a group created for this purpose - October 2011 (O-2011 for short). O-2011 is affiliated with numerous other groups including Intentional ANSWER and Code Pink. Politically it represents the hard left and many of its affiliates are outright socialists. During the first couple of weeks of the protest signs saying "socialism now" or similar were common.

Where the Tea Party prides itself on following the law, the OWS had 700 arrests over the weekend. Police have been forced to use pepper spray (with video showing that they were provoked).

The OWS movement is part of a series of long-term protests set up by activists who have rejected democracy. It started in Wisconsin and Ohio in protest of union-busting legislation. Not surprisingly, several labor unions have expressed support for the OWS. All of this is influenced by the Arab Spring protests.

O-2011 is trying to be a throwback to the glory days of the 1960s and early 1970s when mass protests were common. Of course, those were mainly for racial equality or against the Viet Nam war (or both). One giveaway is the symbol used by O-2011 - a black fist with the Earth superimposed on it. This fist was a frequent symbol of resistance during 1960s protests and continues to be used by socialists. In fact, the black fist has its own Wikipedia entry.

One common thread I heard during the protests of the Winter and Spring was that they represented "democracy" and that lawmakers who acted contrary to the protestors were somehow anti-democratic. O-2011's web site explains this:

Democracy is a simple idea. It means "the people rule." The promise of the United States is democracy. The reality is that corporate elites rule. The contradiction between the promise and reality of America has produced a movement to make the promise the new reality.

We believe it our birthright to directly participate in power. Elections were always a poor substitute for participatory democracy. And elections delegate power from the people to a tiny elite easily browbeaten or bought off by major corporations. Most Americans intuitively know this.

So, to this movement, elections and elected representatives no longer matter. All that matters is who can put people in the street.

The OWS protestors have pledged to remain as long as it takes. This looks like it will be a long wait since the movement purposely kept its goals vague.

Monday, October 03, 2011

The Tea party and Occupy Wall Street

It's hard to have much sympathy for the Occupy Wall Street movement. They were originally organized by socialists (really) and most of the protesters have no idea what their goals are. Some are for an end to war or to inequality. Many of them are against college debt (theirs). The main thing that they have in common is that they are fed up with Wall Street.

Some of their grievances overlap with the Tea Party. Both groups are upset with the billions in bailouts and the tight relationship between President Obama and Wall Street.

After reading the book Confidence Men, I'm tempted to join in the protest. early on the Obama administration adopted two mantras - "Do no harm" and "Be Sweden, not Japan". The second was inspired by a column by Paul Krugman contrasting the ways that Sweden and Japan responded to fiscal emergencies. Sweden emerged quickly while Japan struggled through what is known as the "lost decade".

Unfortunately, being Sweden meant taking actions that would upset Wall Street and that ran into the primary mantra, "Do no harm." Obama's advisers convinced him that the road to prosperity lay in propping up the banks until things resumed their pre-crash status. The fact that the banks were engaging in risky behavior and are resuming the same practices was given a pass. Trying to do any serious reform would undermine the confidence in Wall Street and it would collapse into a new Great Depression.

The title of the book refers to the belief that confidence in Wall Street is paramount.

So Wall Street got multi-billion dollar bailouts and resumed multi-million dollar bonuses while the rest of the country stagnates.

While many in the Occupy Wall Street movement still support Obama, the movement itself could cause him as much trouble as the Tea Party. It is largely comprised of disappointed progressives. They had been silent for the first couple of years of Obama's administration because they expected that the most liberal president in decades would pursue a more progressive agenda.

The last thing that Obama needs now is a challenge from the Left. Many people blame Ted Kennedy for weakening Carter by entering the 1980s primaries. This overlooks the widespread discontent with Carter that allowed Kennedy to capture around a quarter of the primary votes. Even if Kennedy had not run, that discontent would still have been present.

The Tea Party is still going strong on the right and now Obama is being attacked from the left. It is hard to imagine the Wall Street Occupiers voting for a Republican but it is easy to imagine them staying home or voting for a 3rd party candidate. With both groups tapping into general outrage over the bailouts, this would be a line of attack for a Republican challenger to use to take the White House.

Thursday, September 29, 2011


Our modern world is built on debt. Instead of saving up for big purchases, we borrow the money and pay them off over time. On the individual level it's how we buy our houses, cars, and fancy electronics. It is also how our cities and states build roads and bridges. Our businesses borrow money in order to expand. In general there is nothing wrong with debt.

Unless you start borrowing to meet operating expenses. That's where the world is right now and why the economy is not going to recover quickly, no matter what the politicians do.

Forty years ago people managed their debt better. General credit cards were rare. Most cards were tied to individual stores or chains. You had a gas card for the brand of gas that you bought and a card for the department store you went to. Sears and Penny's had their own cards. All of these were reviewed regularly to be sure that you didn't get too deep in debt (this was for the card-holder's protection). Banks had Christmas clubs where you put in a set deposit every payday for a year in order to have a set amount of cash for holiday spending (this is one reason that the Christmas buying season didn't start until Thanksgiving - people didn't have their Christmas shopping money before then).

Since then we have had an explosion of debt. Prior to the tax simplification in of 1986, interest could be deducted from your income tax. After that, only interest on your primary residence was deductible which caused a rise in mortgage-backed debt.

Short-term consumer debt (credit cards) always charged a rate higher than inflation but legal cap on interest was raised in the late-1970s to keep up with the high-inflation of the time. This was never lowered even though inflation has been negligible for more than a decade. That means that banks make huge profits on credit cards which gives them an incentive to offer ever-increasing amounts of credit.

In 1993, the economy was given a boost when long-term interest rates were lowered. That allowed people to refinance their homes at a lower rate and spend the difference. Banks could make a nice profit by refinancing loans then selling the loans. Starting in the late-1990s, programs to increase minority home ownership caused the standards for granting mortgages to be reduced or nearly eliminated. Previously you had to put up a 20% down-payment and show that the mortgage would be less than 1/3 of your monthly expenses. Those requirements were waived. Interest rates continued to drop fueling more refinancing. At the same time the lower standards caused a bubble in real estate values.

Banks figured out ways to combine mortgages into a new type of financial instrument. The idea was that real estate values might drop in one area but would keep increasing in general and the default rate on loans was fairly constant. If you combined mortgages from across the country into a single instrument and tossed in some mortgage insurance equal to the expected default rate then you had an investment that was nearly a sure thing. Given the low interest rates for business loans, fortunes could be made by taking out a loan to buy these instruments.

Complex mathematical models were created to evaluate the risk of these investments but they assumed a steady market. Besides, the rating agencies such as Standard & Poor made a fortune by rating these investments as safe.

So consumers borrowed which caused the big investment banks to borrow. There was so much money to be made that anyone who questioned the basis for this new economy was fired.

While consumer and corporate debt exploded, countries did a lot of borrowing of their own. As part of the progressive movement, most countries established an implied social contract which said that their government would help the poorest and provide free or discounted medical care and retirement. This was accompanied by an explosive growth in government. Compared with Europe, the US was a piker in this. Many European countries provide free medical care, university education, and child care along with generous vacation. The stability of this was always questionable because of Europe's low birth rate.

The problem is that, even with high taxes, there was not enough money to pay for all of this so Europe borrowed heavily. The US did a lot of borrowing of its own but hid a lot of it in the Social Security Trust Fund. Since this is money that the government owes to itself, it is not usually counted in the national debt but it has to be repaid, regardless.

When Bill Clinton became president he was shocked to find that the biggest single item in the budget was payments on the national debt. Working with a Republican Congress, Clinton managed to turn the deficit into a mild surplus (not counting the Social Security Trust Fund which continued to grow). Between the collapse of the Internet Bubble, the recession of 2001, and the terrorist attacks on 9/11/2001, and general spending by the Bush administration, the US budget went back into deficit. Payments on the national debt actually decreased as the Treasury took advantage of lower interest rates to refinance its own debt.

But you cannot keep running the world on debt forever. Rising demand in China caused an increase in the price of raw materials. In order to head off inflation, the Federal Reserve raised interest rates. This caused people with variable rate mortgages to default on their loans. This, in turn put enough newly foreclosed houses on the market to pop the real estate bubble. House prices started going down instead of up and a quarter of the country found that they owed more on their house than it was worth. The default rate went up again.

Suddenly the mortgage-backed financial instruments were not a sure thing any longer. Banks found that assets that had been worth billions were suddenly worthless. This led to a credit-crisis.

Between the sudden tightening of credit and the failure of the housing market, the economy went into a steep recession. This led to a drop in tax revenues which made the deficit much worse. The government's response was to try to stimulate the economy with new spending which made the recession worse.

Over in Europe, it turned out that many people had invested in Icelandic banks which went under leaving the Iceland government on the hook for more assets than the country was worth. Ireland had suffered its own real estate bubble. Spain had wasted billions on green energy initiatives that turned out to cost two jobs for every new job created. Portugal and Greece had been borrowing heavily just to finance lavish public benefits. With the world in recession, nations world-wide saw tax revenues drop and most of Europe found itself being squeezed.

Greece needs help just to pay operating expenses and still meet payments on its national debt. With a default a distinct possibility, no one wants to buy their bonds. Their only hope to remain solvent is for the rest of the Euro-zone to either give or loan them money.

Even though Europe is reaching limits on how much it can borrow, citizens are rioting in the streets. They want their promised services and refuse to believe that there is not enough money to pay for them. The same thing is happening in the US although not on the same scale, yet.

The long-term problem is that the debt-based economy was unsustainable. Period. Once you reach the position that Greece is in, you cannot keep borrowing because no one will give you loans.

The US will be in this position in a decade. By that time entitlements and interest on the national debt will take up the entire budget. There will not be any money left for anything. No roads. No education. Nothing.

Currently the left is calling for increased spending in order to try to restart the economy. "Yes," they say, "We will have to deal with long-term debt eventually but first we have to get past this short-term problem." This approach is just making things worse. a few days ago the White House pointed to a prominent, independent economist who said that the President's jobs program would reduce unemployment by as much as a million people. The proviso is that this boost would be for one-year only and after that it would be a drag on the economy.

The problem is that we cannot put things back like they were. People are more wary of debt and the banks that survived are much more wary. You can't reinflate a bubble economy. At the same time, the long-term problems have to be addressed soon and they will take more than taxing the rich.

It is true that austerity budgets will cause short-term pain. The only payoff will be the lack of an international collapse a decade or more in the future. Many politicians see this as an opportunity. They will accuse the responsible side of wanting to throw grandmother off a cliff. They insist that the social contract is more important than fiscal realities. If all else fails, their back-up plan is to pay their debts through high inflation. All of this will be disastrous but the disaster will take place in the future.