our comedian-in-chief

CBS captures a couple great quotes in this article.

"[T]here is no* country on earth that would tolerate missiles raining down on its citizens from outside its borders..."

"So if we're serious about wanting to resolve this situation and create a genuine peace process, it starts with no* more missiles being fired..."

* whereby "no" excludes places that the Obama Administration and partnering governments like to bomb.

back to where it started

(P) One of the reasons I did not support then Senator Obama in the Democratic primaries was his embrace of the Establishment way of thinking with regard to using American power to force sovereign nations to obey edicts from Washington. This kind of power projection not only makes us less safe as it incentivizes the very foes we are supposedly fighting to oppose us more directly, but moreover, it undermines our position of leadership by wounding the most important levers of our credibility. The true greatness of the American century was in our persuasion of nations to voluntarily join us, aligning economic, legal, environment, and human rights policies with our own, sometimes literally rebuilding countries in our own image.

In particular, the Senator spelled out his obeisance in a Foreign Affairs article in the summer of 2007. [Unfortunately, it is behind a paywall - funny that you have to pay for the privilege of accessing Conventional Wisdom. It's like they don't really want you to know what the DC crowd are thinking. But you can go to your local Elite University and find publications like Foreign Affairs easily enough, assuming the University Police don't taze you out of the library first.]

While broadly embracing that fun phrase The American Way of War (such as, for example, never actually using that little three letter word), Obama's article singled out one country in particular for action - Iran.

Five years later, we basically have confirmation that President Obama personally authorized war against Iran. Specifically, he instructed the development and release of a malicious computer program that targeted uranium enrichment equipment in the country. This worm, Stuxnet*, accidentally became public a few years ago - apparently the Obama Administration originally thought they could do this and keep it secret forever - and so the guess was that the Israelis and/or Americans were involved. This weekend, the Corporate Media paid homage to what Glenn Greenwald brilliantly calls Obama the Warrior as that guess became more like a sure thing.

So here we are. We can have legitimate policy disputes about the drug war or financial bailouts or warrantless spying or Race to the Top or many of the other Administration policies that I adamantly oppose. But we now have The Paper of Record openly explaining that the President of the United States committed an act of war against a sovereign country. How can anyone who opposed the major policies of the Bush Administration support the reelection of President Obama? How about anyone who believes in basic principles like the Constitution or national sovereignty?

That's going to be a sticky line of thought the next few months.

* Incidentally, Stuxnet in particular demonstrates the law of unintended consequences and how this type of behavior is a direct threat to our national security. Of course there are going to be computer programming errors in a project that complex. That's how this stuff works. Furthermore, Stuxnet is an extremely dangerous worm because it actually destroys the hardware it operates. That hardware isn't some Iranian bomb - it's equipment manufactured by Siemens that is used all over the world for producing nuclear power. We have now proven to every foreign government, organized crime operation, and terrorist group the possibility and effectiveness of damaging control equipment. It's a good thing our own country doesn't depend on any computer systems to keep our infrastructure running!

small potatoes

This post attempts to organize some thoughts regarding where we are headed. It's fun when there is a clear vision, but perhaps the most important times for reflection are when things are muddier. Basically, if we can identify unsustainable trends, we can identify sources of change. While the catch is anticipating what exactly that change will be, having some semblance of the terrain is useful.

One of the analytical approaches that interests me is where the tendency toward optimism/pessimism intersects awareness of reality vs. fiction. There is a lot of emphasis in our culture on the first dimension, almost as if being optimistic is more important than being right. Visually, it puts the emphasis like this, on the vertical columns.


However, an attempt to rationally understand the world around us needs to compensate for that natural cognitive fallibility by emphasizing the horizontal.


Truth requires an ability to interpret events both optimistically and pessimistically, to have a vision of what could be yet also a sense of what might go wrong.

With a couple decades of general wage stagnation providing the context for several years of very specific economic hardship and dislocation, the strategy of the governing coalition of interests in the US appears both clear and consistent. Outside of the national security nexus (GWOT, drug war, deportation, etc.) neither the Bush nor Obama Administrations are particularly hostile toward or directly targeting 'average' Americans. The 'not Hitler' meme was one of the better ones that Jon Stewart and Stephen Colbert encouraged at the Rally to Restore Sanity and/or Fear. Metal Chris captured this one:



In other words, it is not so much that individual political leaders act maliciously toward the citizenry so much as they don't care about us. Apathy is the key descriptor; we are simply irrelevant. All of the energy in government is devoted to marshaling whatever resources are necessary to save the Big Fish. What we are left with is the crumbs; small potatoes, so to speak. You can almost see the political class psyching themselves up to sell the latest batch of small potatoes for the masses as something of remotely similar importance to the efforts to save the Masters of the Universe. The transparency that Vice President Biden accidentally showed at the health care press conference, for example, revealed so much.


It's not that Bush's Medicare 'Modernization' or Obama's HCR 'most important reform since FDR nevermind that Medicare thingy in the 60s' are Terrible Legislation that will Destroy America. It's not that Bush was an Idiot or Obama is a Kenyan Muslim Fascist. It's not that abortion and gay rights renders America ungovernable and/or on a path of moral decay and damnation.

Rather, that's not where the action is. Two successive presidents, from two different parties, pushed massively complicated bills that purported to make the healthcare system significantly better. Yet they didn't actually solve the problem of expensive healthcare that causes preventable deaths.

I learned to hone in on that tactic of over-selling and under-delivering as a teenager, and it has proven to be one of the most insightful observations in comparing words and deeds. It's the 'let your yes be yes and no be no' philosophy: either government should do something (such as guarantee quality healthcare for all citizens) or it shouldn't. Both are legitimate beliefs. So is I don't know/let me think about it/it's not important to me. But to pick bits and pieces from both is to give away that neither belief is sincerely held; rather, they are merely justifications for acting upon an unrelated set of beliefs (like the belief that government should protect the economic interests of the wealthy).

Clarity has been particularly revealed with the financial crisis because we now have so much data upon which to draw. It's a simple statement of fact to observe that the Obama Administration supports the use of law enforcement resources to arrest hundreds of thousands of people every year, from illegal drug users to illegal residents to illegal assemblers. Yet one specific group of criminals stand in stark contrast to this massive deployment of police and prisons: politically connected financial crooks. There are literally more baseball players in legal trouble for testimony given before Congress related to steroid usage than there are top corporate executives and board members in legal trouble for all financial crimes combined. The current Secretary of the Treasury was literally head of the New York Federal Reserve when the proverbial bile was impacting the proverbial turbine. The ongoing effort to enter into a mortgage settlement is designed to give the Too Big To Fail financial firms immunity from liability in court - that's the point, that's what a settlement is - a settling of claims of unlawful behavior outside of court.

The preceding paragraph is neither pessimistic nor partisan. It's simply recognizing where we are at. The past and current Presidents of the United States think cocaine users, whistleblowers, protesters, and immigrants should be treated like murderers while financial fraudsters should be treated like people who don't pay a parking meter.

This is beyond specific policy debates or even broad ideological contests. We are now in the realm of questioning, of bringing to light, the core foundations of the American experiment, in all of its grandiose, exciting, and dangerous forms.

Is the Constitution the foundational pillar of secular governance, or do we now look to something else? Is there a rule of law, or a rule by men? Do we want to participate in a peaceful world order, or do we want to instill an American world order? Our basic systems of property and finance and law are quite literally crumbling around us. It's not pessimistic to point this out, to consider the implications. It's responsible.

We know housing prices got out of control. We know higher education costs got out of control. We know healthcare costs got out of control. If actual solutions to these kinds of problems are not going to be forthcoming, that is important to know, to understand what it really means. If you're a Big Fish, you play things very differently, but for areas of American life that depend upon the broad 'middle class', there are only two outcomes. Either public policy ultimately changes and we start encouraging wage growth again (either directly through employment policies or indirectly through additional transfer payments like universal unemployment insurance), or the asset classes dependent upon wages will simply wither away.

This has to happen*.

Either $20,000 - $30,000 a year has to become what it is elsewhere in the world - a comfortable living - or millennials in aggregate looking for jobs have to have a way to earn much more than that in entry level positions. Xers have to have broadly accessible means of earning promotions and switching careers. Baby boomers need to be able to easily replace lost jobs and find part-time income in retirement.

We have utilized credit to bring forward as much consumption as possible. The distant future is finite, too. And the near-future was spent in the past.

Household formation has slowed. New home sales are at record low levels. Record numbers of Americans do not participate in the healthcare system. The percentage of Americans employed has dropped precipitously. Millennials are even ditching things like cable and phones. Student loans - financial commitments undertaken by minors deemed incompetent to buy a Bud Light - can't be discharged in bankruptcy, ever.

Any asset that depends upon middle class wages, any industry that sells to those last marginal dollars of disposable income, will simply shrivel up to a much smaller core.

That's what I don't follow about some of the more intense hyperinflation perspectives. Massive increases in broad pricing measures ultimately requires the government to get money into the pockets of 'normal' people somehow. But that's not the bailout mechanism this time around. The most well connected players are seeing such socialism, but the general citizenry confronts a dearth of capital. I wonder if our 'capitalist' system can handle such misallocation of resources on such a grand scale.

But what I don't wonder is that it is a misallocation. Undermining the rule of law causes many more problems than it solves.

*It is becoming increasingly difficult to get simple, accurate information. The Consumer Price Index, for example, is so watered down and altered that it's not even clear why it's a good measure. A KC strip steak from grass fed open range cattle simply is not substitutable with a breast from a tightly caged, anti-biotically stuffed, corn-fed melange of chickens. Our political process helpfully focuses attention on the relatively small amount of trinkets from places like China and India when the bulk of American household expenses go to much more mundane domestic sources like housing, healthcare, higher education, food, transportation, and so forth. I keep anal financial records, so I thought it interesting to look at a few specific items of my own. By my various calculations, I had a stretch of rental increases that amount to an annualized rate of 4.8%, tuition and fees at Wash U increased by 5%, the cost of an entry level car increased 6%, health insurance increased 12.6%, and food increased 14.7%. The drawback of course is that by being specific, it's unique to me and just anecdotal. But comparing that against the average annual increase in household income over the past decade - 1.6% - it's obvious to see something has to give.

shorter sotu 2012

War is Bipartisan. Yippeee! Look, I used an exclamation point, so it's optimistic!

I was looking at a USA Today questionnaire about the presidential race, and it does a great job of (unwittingly) capturing the impending irrelevance of the presidential election. My first-place match gave my answer in 3 out of 11 categories.

Oh, and my number 2 guy has already quit the race. I know virtually nothing about him. My number 3, well, she also is a quitter, and perhaps personally responsible for the great northern migration south. Obama didn't even rank in the top three.

This is like the opposite of 2000. It's shaping up to be the least important election of our time*. But the match game is fun, go check it out.


*Not that it's worth anything, but I remain unchanged in my opinion that this is still Obama's election to lose. Have you seen the GOP clowns? It's a bizarre world when Ron Paul can have so much fun annoying the establishments of both political parties. How is it that he, not the Democratic candidates, is the one inspiring productions like this?



By the way, check out the screen shot. OFA has money to buy airtime on obscure Ron Paul You Tube videos. That says about everything you need to know about our electoral system.



P.S. - Check out the You Tube video now. It's been taken down for copyright infringement!

government by dow 2011

So at work we were discussing some investment things, and it was mentioned that the stock market was down over 4 percent today. That's in one day.

I checked Yahoo Finance just now and yep, it's pretty bad.





'Government by Dow' has been a fun turn of phrase over the past few years, capturing government's capture of the common good by a much narrower set of interests on Wall Street. But when even Wall Street hates your policies, maybe it's time to rethink. Or at least ask, what is going on?

The day the 'grand bargain' a/k/a debt deal a/k/a CYA for cutting popular programs passed the House, the Dow fell from 12144 to 12132. Then on Tuesday, when it passed the Senate and Obama signed it into law, the Dow closed at 11867. Today, the Dow closed at 11384.

In chart form, the past five days look like this:



Wheeeeeeeeeeeeeee.

Enjoy the ride.

But, I know, whocouldanode that idiotic public policy is bad? Or maybe the efficient markets theory is wrong, and The Market isn't right that the debt deal is awful.

Wait, what's that about unstoppable force hitting immovable object again?

in defense of delta

I've been helping prepare some info at work for a press conference tomorrow on our HVRP program, so I've got veterans on the mind. I checked YahooFinance when I got home, and a story about Delta charging soldiers bag fees naturally caught my attention.

On first glance, it appears pretty outrageous that a big company would tack on fees to members of our armed forces for checked luggage on a flight from DC to Atlanta.

But the thing is, as hard a critic as I am of failures in corporate governance, it's important to observe when the policy under scrutiny isn't actually that terrible. Delta (and the other major airlines) actually have quite friendly policies toward off duty members of our armed forces using domestic, civilian transportation networks. Relevant to this story, Delta doesn't charge any bag fees to checked luggage until the fourth bag, even though they do charge bag fees to other customers on the same routes. Southwest Airlines thinks this is such a huge issue that they've invented an entire television advertising campaign highlighting their policy that 'bags fly free'.

What this demonstrates is one specific example of the economic costs of militarism. There are the direct costs shown on the federal budget, which are astronomical. But then there are the indirect costs on the civilian economy which are even larger. It costs money to fly four bags from DC to Atlanta. It costs money to train soldiers on their return to the US from overseas deployments, on what they should expect right down to the logistical details of how to return home (the military reimburses bag fees). Somebody has to pay for all this.

It's right to be angry.

But in this case, don't be angry at Delta. The problem is DC. When you have Presidents and Congresses that are too deceitful and cowardly to fully account for all of the costs of war, those costs don't simply disappear. They're just externalized onto private actors, from the soldiers themselves to their family members and community to the various actors they encounter in the civilian economy.

And of course, if we weren't deploying troops overseas in Afghanistan, there wouldn't be any troops needing to carry four bags back from Kabul in the first place.

welcome to the other america

(PR) Uh oh, I'm ranting about politics...

I obviously haven't been paying much attention because I didn't realize the Clinton blowjob of the early 21st century was an ongoing matter. But apparently, former Senator, Vice Presidential nominee, and Presidential candidate John Edwards has been under an actual, real-life, full blown Department of Justice criminal investigation because he did something absolutely no politician ever does, try to portray a false public narrative about himself that doesn't match his actual nature.

I mean, thank goodness our political leaders (and heck, our business leaders, too, for that matter) are such paragons of virtue and family values.

But what intrigues me most is that the Obama Administration isn't happy with the Usual Punishment* for Being Caught: expulsion from the club (publicly). They actually want a felony conviction.

Quick, name the 10 most important people the Obama Administration has prosecuted.

Okay, I'll give you multiple choice:

a. George Bush
b. Dick Cheney
c. Condoleeza Rice
d. Donald Rumsfeld
e. Alberto Gonzalez
f. ...uh, this might take awhile...

It's almost comical. I only met John Edwards once (I was a pretty big fan back in 2007 of his candidacy). He struck me in person to actually be a lot like his reputation: he felt like a rich, sleezy used car salesman. I don't invite used car salesmen to my birthday parties. I don't go to movies with them. But you know what, I bought my car from one. They serve a purpose. Where the purpose overlaps with your purpose, they are valuable partners.

I ain't lookin' for a saint; and heck, even saints are sinners.

John Edwards made his cheesy sloganeering about poverty. Even today, you can say the phrase two Americas and largely evoke a pretty coherent narrative that Edwards was telling. Now, he's living the two Americas. The problem with our two-tiered justice system isn't that people down on their luck don't break the law. The problem is when the full weight of the law is selectively administered.

If I knew him well enough to call him John, I'd be in position to talk about how his life has completely fallen apart. I'd wonder what Cate, his eldest daughter the same age as me, is going through. But I don't know the family, and like any other family with moral, and now legal, complications, their challenges are for them to face, to decide how they want to come out the other end. His sin is against his wife, his kids, his family, his faith.

What I do know is that this has a chance to remind us what the rule of law means. It means no one is above it. All are equal under it. Technicalities are all the law is. Create exceptions, and what you've got is two Americas.

* of course, even being caught doesn't necessarily do it. Heck, people as varied as Rush Limbaugh and Tim Geithner have broken the law. And no one in the world avails themselves of more drugs and prostitutes than Manhattan and DC.

further down the rabbit hole

I've had a wide range of reactions to a Supreme Court ruling this week. The Court overturned a decision by Kentucky's Supreme Court that had determined that police busting down a door without a warrant violated the 4th amendment.

I mean, obviously, that's unconstitutional. You have to create an entire theory of Constitutional Law out of thin air to justify something as ridiculous as that. The text is clear. The intent is clear. The application to modern times is clear.

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated

Because the issue is so straightforward, there's really nothing of substance to add to the background at places like NORML's blog.

But two thoughts I will share for intertube posterity.

First, an issue like this is a good reminder to make sure you know what you believe. Times change, social acceptabilities change, do you know what you believe is right and wrong, or do you float with the wind? If you're an American citizen, is the Constitution your basis of political economy, or do you hold some other idea as being more important?

Second, I think this fits into a broader theme of the shifting sands of power as more and more Americans alive today have grown up without a connection to, or even understanding of, the politics of fear and hate and divisiveness that have characterized so much of our myopic focus on wedge issues at the expense of things that really matter. Like many systems of power that are crumbling, it is doubling down on what worked in the past instead of seeking to maintain leadership in the transition to the future.

It's not just the Fed that has some problems, shall we say, with the concept of exigent circumstances.

last call

(P) It's been 21 years since economic sanctions started killing Iraqis in 1990.

18 years since the 1993 World Trade Center bombing.

13 years since the 1998 African embassy bombings.

11 years since the 2000 bombing of the USS Cole.

10 years since the 2001 World Trade Center and Pentagon bombings and the invasion of Afghanistan.

8 years since the 2003 invasion of Iraq.

5 years since Saddam Hussein was killed in 2006.

And now, the White House is set to report the death of Osama bin Laden.

If we don't bring our troops home now from foreign military occupations, we'll be doing this forever.

Forever.

Well, as long as empires last.

Which tends to be shorter than forever.

comedy news network

CNN claims that, "Secretary of Defense Robert Gates is credited with trimming military spending and using a firm hand on tough decisions."

Ha!

pundit4sale

(P) Something that has fascinated me for several years now is how easily some Democratic pundits seem to shift their principles based upon how the wind blows from party leaders. In the short term, it does provide them significant cover in that it is difficult to discern whether they're bought off or honestly believe what they're blathering. But over time, the only value added Dems bring to the equation is inhabiting the reality-based world, in being interested in doing what works.

It's utter nonsense like this spewed by Matthew Yglesias last week - on a Think Progress blog, no less - that starts warranting comparisons to folks like Rush Limbaugh and Bill O'Reilly and Michelle Malkin. Yglesias is actively proposing that powerful people should be above the law. That's a direct assault on the Constitution, not to mention a market-based economy.

So here's the question. Is Yglesias bought and paid for, knowing that the rule of law is a good thing but being willing to shill for criminals nonetheless? Or does he honestly believe that poor people should go to prison for petty crimes while the rich and powerful should maintain their liberty no matter how heinous the consequences of their actions?

I'm obviously a little partial to the Heartland, but the one-two transpartisan punch of Bill Black at UMKC and Tom Hoenig at the KCFRB over the past couple years has been much more interesting than most of the 'liberal' commentary from Inside the Beltway about how we need to Protect the Financial Fraudsters for the Good of us All.

I eagerly anticipate wittiness from Yglesias in favor of the rule of law. Oh wait, just look to the Bush years.

Like this commentary on Attorney General Mukasey.
Or this one on Bush lawbreaking more generally.

Black's response is worth reading in full. And here is the underlying New York Times article from Gretchen Morgenson and Louise Story that set off Yglesias' defense of our rotten system. By the way, how's that for turnabout? The corporate media runs a big story highlighting a major problem, and the 'liberal' blogger Yglesias defends the status quo!

This is also a good place to tie in some commentary from Barry Ritholtz about another NYT article - yes, that's two positive references from me regarding the Times in the same post! Even as the overall US prison population has exploded, the Bush and Obama Justice Departments radically reduced annual referrals of white collar crimes for prosecution. You know, despite the mid-90s having no systemic domestic financial collapse, while a decade plus later, we confront Armageddon that Requires us to Give Rich People Money.

let me see if i have this right

(P) Over the past couple years, Democratic President Barack Obama has argued that the deficit is a serious problem of an urgent nature. To address the presented problem, the Administration has created a fiscal responsibility commission and advocated various approaches like tax cuts, wage freezes, health insurance exchanges, increased out of pocket costs, and so forth. However, the President's budgets haven't actually proposed that revenue equal expenses. After all, the tax cuts, bank bailouts, and military spending have all increased the deficit.

Republican Representative Paul Ryan has also argued that the deficit is a serious problem of an urgent nature. To address the presented problem, he has proposed a budget that advocates various policy options like tax cuts, wage freezes, health insurance exchanges, increased out of pocket costs, and so forth. However, Representative Ryan's budget doesn't actually show how revenue will equal expenses. After all, an actual budget shows not just how much revenue and expenses are projected, but also, what those sources of revenue and expenses are planned to be.

So, uh, what's this about Moments of Truth and Serious Debate and whatnot?

It sounds like we're not even talking about solutions to the purported problem, let alone exchanging ideas about different kinds of solutions.

up is down, black is white

donuts are healthy, Pizza Hut isn't greasy...

...the Bush tax cuts are now the Obama tax cuts(?!?)...

and the US government is effectively at war with a website for doing precisely what the US government has theoretically, supposedly, like, claimed to support

"Information has never been so free," declared Clinton. "Even in authoritarian countries, information networks are helping people discover new facts and making governments more accountable."

Read it and weep, Wikileaks. You took the Executive Branch of the United States at its word.

Ha! Joke's on you.



Now if only a certain college football team with the Spartans as their mascot were also getting royally screwed, there would be a great tie-in...

Oh wait!

quick reminder - Obama's in town tonight

(P) I'm helping out with my Clayton kiddies tonight, but if you've got nothing else to do, Obama and McCaskill are scheduled to put on a fundraiser at the Renaissance Grand at 6:30. You can get SRO tickets for just $25. I assume many of the local politicians will be there.

Alderwoman Triplett's link-through page at Act Blue is here.

Proceeds go to the Show Me State Victory Fund, which I believe is basically McCaskill's 2012 re-election fund.

reproductive (non)healthcare

(P) This isn't about whether you should get an abortion or not. That's a touchy, complicated, messy personal question.

This is about how Democrats are stupid. That's something we can probably all agree on.

When you look at demographics, who votes for Democrats? Well, it ain't richer pro-life men. It's less affluent pro-choice women.

And can you think of anything stupider than telling your base that a common medical procedure isn't part of the healthcare debate? That's pretty much what the Stupak-Pitts amendment does, singling out funding to abortion services in health insurance plans (nevermind that the 1970s-era Hyde Amendment already prevents federal funding from being used for abortion services). Rules on excluding Viagra and Cialis apparently didn't pass the profit test.

'Reproductive justice', 'women's health', 'a woman's fundamental right to choose', 'affordable health care': these are core slogans that get Democrats elected.

This is like if the GOP came into office and decided to increase taxes on the wealthy. That'd get them real far with their base.

Just a refresher, this was Obama on the campaign trail:

Chicago, IL | January 22, 2008

Chicago, IL -- Senator Barack Obama today released the following statement on the 35th anniversary of the Roe v. Wade decision.

"Thirty-five years after the Supreme Court decided Roe v. Wade, it's never been more important to protect a woman's right to choose. Last year, the Supreme Court decided by a vote of 5-4 to uphold the Federal Abortion Ban, and in doing so undermined an important principle of Roe v. Wade: that we must always protect women's health. With one more vacancy on the Supreme Court, we could be looking at a majority hostile to a women's fundamental right to choose for the first time since Roe v. Wade. The next president may be asked to nominate that Supreme Court justice. That is what is at stake in this election.

"Throughout my career, I've been a consistent and strong supporter of reproductive justice, and have consistently had a 100% pro-choice rating with Planned Parenthood and NARAL Pro-Choice America.

"When South Dakota passed a law banning all abortions in a direct effort to have Roe overruled, I was the only candidate for President to raise money to help the citizens of South Dakota repeal that law. When anti-choice protesters blocked the opening of an Illinois Planned Parenthood clinic in a community where affordable health care is in short supply, I was the only candidate for President who spoke out against it. And I will continue to defend this right by passing the Freedom of Choice Act as president.

And on ABC this week:

"I laid out a very simple principle, which is this is a health care bill, not an abortion bill," Obama said. "And we're not looking to change what is the principle that has been in place for a very long time, which is federal dollars are not used to subsidize abortions."

Saying the bill cannot change the status quo regarding the ban on federally funded abortions, the president said, "There are strong feelings on both sides" about an amendment passed Saturday and added to the legislation, "and what that tells me is that there needs to be some more work before we get to the point where we're not changing the status quo."

The comedy really just writes itself. God bless Rahm Emanuel. He probably thinks this is what constitutes 11 dimensional chess. And it's a good thing Pelosi kept impeachment off the table so there was room for this political masterstroke of genius.

the ppip roulette table

(P) Exciting news on the bailout front, we have some more details to chew on regarding the Public-Private Investment Program (ie, the Geithner plan). Essentially, the plan is for government to subsidize the purchase of assets owned by banks.

The plan is neither new nor much of a program. In fact, what was revealed is more like a slow leak of what's been leaking for weeks now about what exactly Geithner, Summers, and other economic voices in the Obama Administration have in mind. What's notable, to be blunt, is the continued lack of transparency about what exactly the ultimate goal is and how exactly the program will get there. It is also hard not to look at the evolution of this idea as being to become purposefully more convoluted and opaque as to make it increasingly difficult for citizens to understand what's going on; the program seems unnecessarily complex precisely for the purpose of masking what it does, and masking what could be done instead.

Before going on, let me add one caveat, and that is that this is easily remedied. Lack of transparency can be very easily addressed by being transparent. This has the additional benefit of being politically sensible as well as letting us analyze the policy outcomes.

But to understand the concept, we don't need to know exactly who will be allowed to buy assets or exactly how the subsidy will work or exactly what the strategic plan is two or three or five steps down the road. And to be honest, that's not where my interest or expertise lies. There are detailed explorations of this that are floating around places like naked capitalism and calculated risk from people who actually are experts about various economic topics.

What I think is helpful is a comparison to an activity that most people can understand. Essentially, the Geithner plan works like a roulette table. There are an equal number of red and black numbers, plus two green ones. [Interesting side note, the American table has two green numbers. The European roulette tables only have one, so the house odds in American casinos are basically twice those of similar European operations. That's a pretty good indicator of how Americans and Europeans differ on a whole range of issues related to risk and corporate control.]

One way to bet is to bet on a color. So say you put $1 down on black. If it comes up black, the house pays you a dollar. If it comes up red, you pay the house a dollar. This is roughly a coin toss, but the 'roughly' is how the casino makes money. Every once in a while, a little over 5% of the time, neither red nor black come up, because two of the numbers are green.

So if you think of this simple bet in expected-value terms, you would expect to earn a dollar about half the time on black, lose a dollar about half the time on red, and lose a dollar every once in awhile on green. In other words, your roulette bet is worth less than a dollar because you expect to lose a dollar more frequently than you expect to gain a dollar. The way that casinos get you to pay a price of one dollar for something that is worth less than one dollar is simple: they appeal to something other than rational, expected-value calculations. They make it fun to gamble. They promise the potential of a big gain. They convince your friends to bring you along on their excursions. Etc.

How does this relate? The core element of plan Geithner is the pricing mechanism. Geithner and Summers are making a very important bet, and like any bet, it's risky. The risk itself is what is costly. The bet is that the various asset-backed securities are priced incorrectly. PPIP is founded on the belief that these assets are priced artificially low; that their 'real' value is higher than current markets are pricing them. The plan is to have government pay private actors to bid on these assets. When the government subsidy is added to the market price, the purchase price will increase.

Here's the problem. On the roulette table, everybody agrees how many black, red, and green numbers exist. Markets, however, do not agree with Treasury and Fed officials about the ratio of black to red to green. Markets are currently pricing assets much lower than banks hold them on their balance sheets. Market prices suggest there are a lot of red numbers and not very many black ones; in other words, the odds of losing money on your black bet aren't close to a coin toss any more. Instead of an expected value of close to one dollar, your expected value has now dropped substantially, perhaps to 40 or even 30 cents on the dollar.

The logical question of a plan designed to leverage private investment is what the Treasury and Fed officials think they know that the very private actors they are relying upon don't know. Hence the need for transparency, for without it, this plan looks like a pretty straightforward transfer of taxpayer money to the banks, just as if the casino decided to remove half the black numbers from the wheel after you had already placed your bet.

it's finally here

Some people have been waiting all weekend for this! And some have been waiting for months. Some of us have spent the last 8 years in anticipation of today.

And of course, some folks have been waiting for this moment all their lives.

It is good to have things to anticipate. It is also good for those moments to arrive.

We approach today from a variety of angles, of perspectives, of needs, of hopes, of places, but we come to this place united, indivisible, seeking liberty and justice for all.

one more day

That's all I'm going to say. After like two years of this, tomorrow is it.

One more day!

well scratch that

I guess hope will have to wait another day. What a pathetic sellout. Naturally, Clinton and Obama couldn't go on record for the cloture vote.

I've thought of a fun challenge. Try to draft a bill that is so blatantly authoritarian and so blatantly a sell-out to corporate demands that the Democratic leadership would enforce party unity in opposition to it.

people are pissed

(P) And it's a good thing! Nevermind what the candidate of change says. It looks like there has been such massive contempt for the outright corruption and unconstitutionality of the FISA changes from Americans of all political stripes that we might have succeeded again in delaying two very simple, very bad ideas: broad warrantless searches by a government that wouldn't even have to make its reports public, and broad legal immunity for corporations that knowingly broke the law, repeatedly, over a number of years.

There's not much more to add about Senator Obama's stance. He's wrong on the issue, he knows he's wrong on the issue, he knows we know he's wrong on the issue, and he knows we know he has purposefully altered his stance from back when Senator Dodd, former Senator Edwards, Senator Clinton, and others were competing with him for the nomination. Either his campaign staff didn't show up for work this week, they think voters are stupid, or they actually favor the unitary executive/corporate authoritarian worldview permeating this bill. None are particularly appealing options to explore from the campaign of the de facto, barring-more-election-theft next president.

So let's talk about the good that is happening. For example, Senator Dodd continues to impress on this issue, proving that a good strategy and being right can produce results. And Senator Feingold continues to prove that one's stature is strengthened, not weakened, by taking strong positions among constituents in a state that's not solidly Democratic like New York, California-or Illinois (apparently 'centrists' and 'moderates' and 'independents', not to mention leftists and libertarians, like leaders who don't sell out to corporate criminals on basic matters of rights and accountability). And Senator Reid came out (was forced?) to publicly announce he wouldn't support the bill. Even Speaker Pelosi, after ramming the bill through the House, was forced to publicly acknowledge that perhaps spending some time debating the bill (in the Senate) would be a good thing after all.

Who knows, maybe we'll get more speeches like this one from Senator Dodd from other Democrats in the future, on this issue or something else. Click on the link, it's worth listening to. Perhaps the most exciting and refreshing speech since Edwards' talk at the winter DNC meeting last year (warning: it's a tad longer than that speech).

Of course, Senator Obama, it is never too late to change your stance to the right one. Abandon the language of fear and deception, the very rejection of which you are basing your campaign on. Americans know national security is important. We also know this bill has nothing to do with national security. Give us the benefit of the doubt; trust us to handle the Constitution the way you trusted us regarding your pastor. You just might be pleasantly surprised.