We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
I ... do not think that anger improves any argument ever, or that the intensity of anger influences the morality or justice of an argument. The merits of an argument are quite independent of the emotion with which the argument is conveyed. Finally, it is the job of elected leaders in any serious country to dampen anger rather than accelerate it. To the extent our politicians (of either party) are exploiting or promoting anger rather than calming people they are doing their constituents and their country a great disservice. The exploitation of anger is the specialty of demagogues and dictators, and is not worthy of American leaders. Not even members of the House of Representatives.
As a share of GDP, CBO says this means spending will hit an astounding 28.5% in fiscal 2009, which ends this September, and still be at 25.5% next year, staying at close to 23% to 24% of the economy for the next decade. As CBO dryly notes, this is "above the average of 20.7 percent over the past 40 years." Even CBO's estimate is conservative because it assumes that most of the spending in the stimulus bill will be temporary, though Democrats are already planning to make much of it a permanent part of the budget baseline.
The trouble with all this off-prompter stuff — the Special Olympics joke, the whining about everyone in Washington being a Simon Cowell wannabe — is that the glimpses of the unscripted Obama are disquieting in what they reveal.
All terrific press for Orion, except that Obama kept pronouncing the company's name wrong, calling it OAR-ee-on.
Unbelievable. Orion is one of the best-known constellations, mostly because it actually looks like its namesake. So evidently we have to add astronomy to history and economics as subjects of which Obama is remarkably ignorant. I'm beginning to fear that our President has below-average knowledge of the world. Not for a President, but for a middle-aged American.
To what extent is his self-confidence and reputation for brains justified? Or is he just another slick and shallow narcissistic pol?
Fascinating story. From Kimball re AIG bonuses and the CDSs:
...Epstein explains, for more than a decade some 400 traders in a London-based subsidiary of AIG have managed $1.6 trillion in derivative contracts for the company. It’s an interesting story:
In 1998, this tiny group got into the newly-created credit default swap business when JP Morgan Chase came to it with a proposition to transform debt on its books into security packages that could be sold off its books. To make these bank debt packages salable to other institutions, they needed credible insurance against default to get Triple-A rating. So the AIG financial product group, seeing no risk of default, sold it in the form of credit default swaps. Soon afterwards, with the support of Treasury Secretary Lawrence Summers (now President’s Obama’s economic advisor), the Commodity Futures Modernization Act was passed, which excluded credit default swaps from being considered a “security” under the jurisdiction of the SEC or any other government agency. This act allowed these swaps to be deployed on a massive scale to convert all kinds of debt, including even subprime mortgages and car loans, into triple A securities and turned AIG’s arm, now headed by Joseph J. Cassano, an aggressive Brooklyn-born alumni of Drexel’s back office operations, into a multi-billion dollar profit center for the insurance behemoth. Even though the unit’s 400 or so traders constituted less than one-third of one percent of AIG’s loyal employees, it produced close to twenty percent of its total operating profits. While Cassano kept the list of his counterparties in the credit default swaps a closely held secret, he bragged at a conference in 2007 that they included a global swath of “investment banks, pension funds, endowments, foundations, insurance companies, hedge funds, money managers, high-net-worth individuals, municipalities and sovereigns and supranationals.” By 2006, his group was raking in nearly $4 billion in profits, and, as is the tradition in the derivative game, he and his traders got a rich cut of the loot, which on average amounted to roughly $1.1 million a trader.
So far, so good, right? No complaints then. These guys were coining money and a lot of people got rich, spent their money, and made a lot of people happy.
But into every life a little rain must fall. Epstein continues:
With the collapse in 2008 of the debt AIG was insuring, came such massive losses that Cassano resigned, and AIG, unable to post collateral, faced bankruptcy. At this point in September 2008, the US government rescued AIG, pouring in $173 billion of tax payers’ money. Even so, there remained a $1.6 trillion in potential liabilities that could be triggered by thousands of the credit default swap contracts, many of which would not expire until 2012. To prevent hundreds of billions of losses, these custom-designed contracts had to be continually watched, and, if necessary hedged, by traders who understood each one’s particular vulnerability.
So what would you do if you were Obama, Maxine Waters, or some other moralistic scold? Deplore the bonuses? Easy to do, but at what cost?
All those complex contracts: who was going to deal with them?
To perform this critical task, the remaining 370 or so remaining traders in the group wanted the same sort of guaranteed compensation in the form of retention bonuses as had in their two year contracts. The situation for AIG, and the US government that now owned 80 percent of it, was not unlike the one in Mario Puzo’s Godfather in which an offer is made that cannot be refused. In this case, even without a bloody horse head under the blankets, AIG and its federal overseers could not risk falling into a $1.6 trillion black hole by turning down the demands of the traders in the financial product group. It was not that these traders had such unique skills in managing derivative contracts that they could not be replaced by other people but that they knew the business’ crucial secrets, including the identities of he counterparties to the credit default swaps and the vulnerabilities in their positions. The implicit threat: they could use the secrets to which they were privy to trade against AIG’s positions as it attempted to unload its $1.6 trillion dollar portfolio.
Maybe, all things considered, AIG did the right thing, the prudent thing, the fiscally responsible thing?
Under these circumstances, rather than risking immense losses from having their secret book compromised, AIG paid to keep its traders from defecting. Their compensation, when approved by the Fed and Treasury, would amount to about $500,000 a trader a year ( less than half what they had been getting in 2008.) The staff at the NY Fed, while Timothy Geithner was still its head, in fact helped negotiate the terms for these retention bonuses. When Geithner moved on to become Treasury Secretary in January 2009, he presumably understood how financially dangerous it could be to do otherwise, since he intervened with the Senate Banking Committee Chairman in February to get a provision dropped from a bill that would have prevented AIG (and other recipients of federal money) from paying such huge bonuses. In fairness to Geithner, the alternative to making these pay-offs might have proven a thousand times more costly to AIG, and its defacto owner, the US Government.
Moralistic outrage can be a delicious emotion. But it is worth making sure that you have the right target before going to town with it.
So this London group sold the insurance (CDS) based on a low-risk prediction, predicted wrong, and left us looking at such vast and disruptive counterparty risk that something had to be done. The bankruptcy of AIG was not a reasonable or responsible option. Apparently making CDSs "non-securities" made the whole mess possible, but I understand why the Clinton admin did that at the time: they did not anticipate that it would make it possible to put lipstick on pigs, and that one could run out of lipstick.
It's all about the unintended and unexpected consequences of financial legislation. Even the smart Larry Summers was the biggest supporter of CDSs, and tons of supposedly savvy folks wanted to get into the CDS market for speculation, hedging, or arbitrage. Wiki has a good description of the CDS markets.
...the New York Daily News editorializes: Congressional Democrats’ bonus witch hunt will sink N.Y. “The tax plan approved by the House as revenge against a handful of obscenely greedy AIG executives would slam tens of thousands in the financial industry, many of them New Yorkers, who have nothing to do with AIG or any other wrongdoing. And that would be just start of the collateral damage. The levies are so draconian that major banks that took bailout money are threatening to give it back - defeating the purpose of jump-starting the economy with an influx of cash.”
The Tea Party in CT was 7 times larger than the ACORN busload of (probably paid)protesters from Hartford. Who got the MSM coverage?
As I mentioned during the presidential campaign, Mr. Obama was seriously unqualified for the job of president. He had no practical experience in running anything, except political campaigns; but worse, his background was one-dimensional.
All his life, from childhood through university through "community organizing" and Chicago wardheel politics, through Sunday mornings listening to the Rev. Jeremiah Wright, to the left side of Democrat caucuses in Springfield and Washington, he has been surrounded almost exclusively by extremely liberal people, and moreover, by people who are quick and clever but intellectually narrow.
He is a free soul, but he is also the product of environments in which even moderately conservative ideas are never considered; but where people on the further reaches of the left are automatically welcomed as "avant-garde." His whole idea of where the middle might be, is well to the left of where the average American might think it is. To a man like Obama, as he has let slip on too many occasions when away from his teleprompter, "Middle America" is not something to be compromised with, but rather, something that must be manipulated, because it is stupid. And the proof that it can be manipulated, is that he is the president today.
It is at this point that the phenomenon known as "too clever by half" sets in.
How can being a Lefty be avant garde in 2009? It's so passe now.
...there is a risk to the U.S. system with more people relying on entitlements. "Well, they become an interest group," Mr. Becker says. "The more you have dependence on the government, the stronger the interest group of people who want to maintain it. That's one reason why it is so hard to get any major reform in reducing government spending in Scandinavia and it is increasingly so in the United States. The government is spending -- at the federal, state and local level -- a third of GDP, and that share will go up now. The higher it is the more people who are directly or indirectly dependent on the government. I am worried about that. The basic theory of interest-group politics says that they will have more influence and their influence will be to try to maintain this, and it will be hard to go back."
No kidding. Everybody loves a free all-you-can-eat buffet.
“I feel utterly powerless to do anything about the fellow in the Oval Office who combines infantile leftism and adolescent grandiosity in roughly equal measures. It seems to me that every day he is responsible for assaults on the freedom and well being of the American people. I can't keep up and I can't stand to pay attention.
“His aim seems to be to reduce us to government dependents. His inattention to rehabilitation of the financial system in lieu of vastly expanding the size and scope of the government is a dead giveaway, as is his lack of concern over the vast destruction of wealth his policies are working (and will continue to work).
“Perhaps most depressing to me is the manifestation of his adolescent grandiosity in his stewardship of foreign policy and national security. He doesn't understand that the government of Iran is intent on acquiring nuclear weapons it can put to evil purposes. He thinks he can sweet-talk them out of achieving this objective.”
“Why are Americans hesitant, bewildered after the arrival of the Messiah?
“Not for the reason our President attests about high unemployment or shaky GDP or the lack of national health care. We simply are ashamed of our profligacy; we don’t trust those who should be trusted; we put up with the crass and honor the mediocre and ugly; and we fight and bicker over the distribution, never over a share in the creation.
Hope and change, indeed.”
Both Johnson and Hanson, in effect, point at frustration at both external events and at our own behaviors.They are correct.And, for me, they are incorrect.Depression comes from frustration with non-attainment of unrealistic objectives and inadequate actions to overcome.
I’m not depressed.Mostly because I’m a glass-half-full type, with the life experience that with difficulty and pain has seen and been shown that it is.
Depression implies a fixation upon the perceived negative forces at work, with a tendency toward paralysis of action to change them or our self.These are unconstructive and self-defeating attitudes and behaviors.
Avoidance of or ending depressed feelings and behavior comes from attitudinal resilience and from engaging in efficacious actions.
No doubt, we’re in a mess, both of our own making and by others, and many in our political and societal elite are making it worse, with potential dire consequences.Still, one must recognize the resilient strengths we have.Forty-eight percent did not vote for Obama, despite a perfect-storm in his favor, and current polling shows him losing support, and even his allied media are having to take some notice of his excesses and lackings.The US is emerging from this economic calamity relatively stronger than other countries.The positive trend-line in Iraq, Afghanistan, and elsewhere that was hard-earned under Bush has not been abandoned by Obama, though it may become weakened.Ordinary Americans are buckling down in their personal affairs and continuing to achieve for themselves, society, and our futures.
Scott Johnson, however, seems to recognize the negative feedback felt by being ignored and powerless to be efficacious.Those who’ve argued long and hard for greater sanity do not feel recognized with success or able to measurably change that.Are they heading to a new version of tuning out?I don’t think so. But, what is needed instead is even more diligence and exertion, particularly in new ways – sane ways -- of engaging themselves and others.
Many are working at that.Real change takes a while, in fits and starts, through trial and error, but relies ultimately upon faith in oneself, in one’s beliefs, in the decency and sanity of others, and thus in outcomes.
I’m not Pollyanna, but even prefer that to a depressed hole.So I’m not depressed, but energized. I know it works.
It's ACORN that is running those AIG bus tours in CT - meaning that this is being done on our nickel (ACORN was given $2 billion in the stimulus). Remarkably, Conyers plans probe of ACORN.
The Global Warming Three are on thin ice. This was pure publicity stunt posing as "science." Amusingly, it was too cold for them. Gotta love this quote:
The idea is that the expedition should take regular radar fixes on the ice thickness, to be fed into a computer model in California run by Professor Wieslaw Maslowski, whose team, according to the BBC, “is well known for producing results that show much faster ice-loss than other modelling teams”.
The video to Iran is the latest catastrophe. Mr. Obama simply does not understand how his "olive branch" will be received, not only by the mullahs in Iran itself, but wherever else on the surface of the planet the United States has enemies. It "reads" -- to people who do not share anything like America's aspirations -- as an unambiguous confession of weakness. He has moved the American position towards Iran from offensive to defensive, for no defensible reason.
I have a special needs child. He looks like you’d imagine a special needs child looks when he throws a ball. He looks like you’d imagine a special needs child looks when he catches a ball. He looks like you’d imagine a special needs child looks when he runs. He looks like you’d imagine a special needs child looks when he bowls. He rode the short bus for a while.
Sounds hilarious doesn’t it? You know, running, throwing, bowling awkwardly because of muscle imbalances and fear of falling and fear of being hit by the ball. What’s amazing is that his Little League teammates haven’t laughed or poked fun. Not. Once. They have managed to show more class, patience, empathy and charity than the President of the United States, but that’s turning out to be no big feat.
Some banks took the bailout money as a favor to the Feds to put more capital out there. Luskin:
No one seems to care that the 90% tax will apply to all banks that have accepted federal money, not just to AIG. That includes banks like Wells Fargo, who told Treasury secretary Henry Paulson that they didn't even want the money when the Troubled Asset Relief Program (TARP) was enacted last October. Reluctantly, Wells took the money at Paulson's urging, as did other healthy banks such as JPMorgan. Now virtually every employee of every one of them faces a 90% tax on their bonuses.
This administration really is Clown Central. You thought last month’s grotesque budget was bad. It turns out that the projected deficits are now $2.3 trillion worse than the estimate made just last month. Incredible.
Our MSM has already been a voluntary mouthpiece for the Left and an apologist for the Dem party for many years. How much more so would it be if they were financially beholden to the givernment?
Reform of health care, environmental policy, education, energy, banking, regulation — every nook and cranny of the U.S. economy has been put on alert for major change. Expansion of government spending, plunging the U.S. into unprecedented deficits, is without parallel. In economic policy, through regulation and control of energy output, financial services and monetary expansion, the U.S. government has embarked on a fundamental reshaping of America. It is designed, in short, to bring on the end of America.
Seems to me that many people are more worried about what's going on in the Federal gummint than about the economy.
This week's shameful display by politicians in Washington to beat their breasts and demonize AIG has revealed even more clearly why we shouldn't want those very same politicians to be running our economy, health care industry, education system, and energy policy. Michael Gerson perfectly captures that display of self-satisfied hypocrisy.
In turbulent times, it's good to know some things never change. After a week in which President Obama thanked himself for inviting him to the White House, compared AIG executives to suicide bombers, and did the first Presidential retard joke on national TV, I was impressed to find that Slate is bravely keeping up its Bushism Of The Day feature.
Most Americans, unlike Europeans, are emotionally mature enought to be willing to see that government is not run by their betters, but by cowardly morons - often by cowardly moronic narcissists who could never handle a real, demanding job in which their added value could be measured.
The widespread recognition of that is one thing that distinguishes America from nations with monarchic, dictatorial, and dependency traditions.
Hope springs eternal from the human breast, though, doesn't it? Even from those who know better.
I have felt disgusted and embarassed by our federal government and the administration over the past few weeks. We posted earlier today that these people could not run a successful candy shop, much less the government. But they have not shown that they can even run their own lives honestly and effectively. That's why I want them as far as possible from my medical care, my investments, my business, and my pocketbook - and from everything else in my life. Please - do me no favors.
Three posts that captured some of my feelings today:
I deplore this confiscatory tax aimed at whoever Congress is mad at today. Right now it's AIG and Fannie Mae; later it will be Merrill and Citibank, and eventually it will be defense contractors, profiteering oil executives, or whomever the Congressional Dems single out as their whipping boy du jour.
And of course, rolling this ex post tax out at the same time the Fed and Treasury are trying to encourage private investors to partner up with the government to get the credit markets moving again is insane. What investor needs the likely aggravation to follow? Who needs to be hauled in front of Barney Frank a year from now in order to be blasted as a profiteer who exploited our national crisis for his own profit, which Barney will then tax back? Who will be daft enough to come out of retirement as Liddy did to endure the abuse Liddy took?
"Responding to the anger about bonuses paid to AIG traders, the House approved a bill Thursday that would impose a punitive 90% tax on bonuses paid by American International Group Inc and other financial companies that receive federal help. The vote was 328-93. The bill would apply to bonuses of people making more than $250,000 a year, and would apply only to payments from companies getting more than $5 billion from the federal government."
From James Madison:
"Bills of attainder, ex post facto laws, and laws impairing the obligations of contracts, are contrary to the first principles of the social compact, and to every principle of sound legislation. ... The sober people of America are weary of the fluctuating policy which has directed the public councils. They have seen with regret and indignation that sudden changes and legislative interferences, in cases affecting personal rights, become jobs in the hands of enterprising and influential speculators, and snares to the more-industrious and less-informed part of the community."
Sober people are in short supply nowadays, ain't they?
That's what Jim Hansen is calling for. Glad we didn't give them a dictatorship when they wanted us to fight global cooling 15 years ago...or every other time in history when the experts have been wrong.
Hansen, like Gore, has obviously not been taking his medicine.
Shep gets it (h/t, Anchoress). It's good to hear the truth from the MSM instead of pure flacking and brown-nosing. Makes me think more highly of Shep Smith:
Shining Path Maoists embrace Capitalism. And shame on Amherst College: I guess they are the new Maoists. How come Lefties refuse to discuss ideas? All you get from them are insults, ad hominems, and censorship.
Of course this is all a sham, today’s TV show for the rubes and morons to keep them riled up and to distract attention from The Great Train Robbery that really deserves universal opprobrium (and perhaps also to distract attention from genuine executive incompetence). AIG’s bonuses were only about 5% of what was paid by Merrill Lynch, for example. But AIG is Villain of the Day and so today we watch while AIG is thrown to the lions. Who gets eaten by the lions on tomorrow’s TV show?
Obama is an interesting character. His professorial approach and failings as an executive are paired with an apparently effective political strategy, at least as of this moment. Always have a clear enemy, always attack, and have a clear political aim. We wonder just how long the American people will let themselves be distracted by this endless cavalcade of villains being paraded before them to serve the purposes of the administration and congress.
Experiment with Lesbianism. Why not? I can relate: women are appealing.
Keeping Christians out of the UK. Right thing to do. You never know when those Christian wackos might decide to blow people up in buildings and subways.
The U.S. government mandates fuel-economy standards that force Detroit to make cars Americans don't want to drive. When Detroit loses money on those cars, Washington throws taxpayer dollars at its mistake, and the car makers demand a tax increase that would prod Americans to buy the unpopular cars that Washington mandates. As for what the American consumer or taxpayer wants -- or can afford in today's economy -- who cares? Welcome to government-run energy policy.
...we have a Movement -- this is their term, not mine -- organized by, and loyal to, a sitting President. Pledge canvassers, armed with your name, will ask you to pledge loyalty to the President too. A president whose term has already become a permanent campaign, is signing up ground forces in a mass organization pledged to personal loyalty to their Leader.
Does anyone know of any historical precedents for this in the United States?
On Social Security, he said "changes will be necessary" to the nation's retirement program. He emphasized, however, that the single most important thing the U.S. could do to put itself on a firm financial footing is to reform health care.
Pure baloney. There is no linkage there, unless they just repeat it often enough somebody might buy it.
More on the bonuses from the Financial Post. “To use a current cliche, frequently deployed to humiliate bankers and CEOs: He doesn’t get it. Barack Obama, that is. He just doesn’t get it, and nor do millions of others who are following the U. S. President on his long destructive march against bankers and corporate executives for their alleged ‘recklessness and greed.’ . . . The leading government-created disaster behind the financial crisis is U. S. housing policy and the multi-trillion dollar securitized mortgage market created by the U. S.-government backed mortgage agencies known as Fannie Mae and Freddie Mac. In comments in 2007, Mr. Bernanke reported that the two agencies, with $5.2-trillion in mortgage obligations, posed a systemic risk."
The MSM 
Obama 
“
It's 
Battle lines drawn on health care. 
Photo: 
From today's 
Shining Path Maoists