The Senescent Man

Fast forward to the last four months of the Bush Administration, and the Panic of 2008. The economy was already in a downturn, and had been for some months. We all got a stimulus check, a return of our tax money, earlier in 2008. So we already knew things were going downhill.

Then banks that were "too big to fail" started to fail. We learned they were "too big to allow to fail"--or so we were told. How many billions of dollars were authorized or appropriated to rescue failing banks? Was it $700 billion? I think the earlier stimulus bill was about $300 billion, so that put us at a trillion dollars, spent or authorized, to prop up an ailing economy.

Of course, we weren't through yet. Bail-out of the United Auto Workers at General Motors and Chrysler was to come, a paltry $20 billion or so. Then there's the next stimulus package, passed in the early days of the Obama administration. There's no telling where that ended up. No one read the bill in any of its several versions. $800 billion is the best guess, but it might be a hundred more.

So we are up to about $2 trillion dollars of spending, give or take a couple of hundred billion, either already done or fixin' to be done, to keep our economy from going into a depression. We, the Baby Boomers in control of Congress, the Baby Boomers who are running the corporations, the Baby Boomers who are filling the majority of places in the work force and beginning to creep to retirement age (the oldest of our group are already there) have done this. Where did we get the money? Did we have it, stashed in a failing bank? Was it buried in a field? Of course, no. We manufactured it out of thin air. We are either going to print it or borrow it. Borrowing we are familiar with, since we've done so much of it over the years. Printing money is kind of new, but we are willing to try it. Call it "Instant Money".

And, typical of the Baby Boomers, the Candy Store Generation, we are not looking far enough ahead to think about how we will pay the bill for debt service when it comes due. We'll no doubt piddle around with it over the next ten years, but really the bill will be paid by the next generation, the Gen X-ers as they are called, or maybe even the ones after them, Generation Y. One of these groups will eventually take real steps to fix everything. That will be when the bills come due and the taxes need to be raised to pay them and they will stand up and say "had enough." Had enough of borrowing. Had enough of confiscatory taxation. Had enough of these lame-brained Baby Boomer schemes to continuously live off other people's money. And they will be called the "Had Enough" Generation.

I don't know if I'll live to see the Had Enough Generation clean up the mess the Candy Store Generation has made. It's a good sized mess. Candy wrappers everywhere. Failing social programs. Failing retirement programs (i.e. Social Security, which we wouldn't fix for our children so long as it still worked for us). Expansion of rights based on prosperity not on what God gave us. Unrealistic expectations suddenly crashing down around us. A debt amassed that no reasonable bank would loan proportionately to any corporation or individual. We've sure made a mess that we're leaving the Had Enough-ers to clean up.

I guess "The Greatest Generation" didn't teach us too good.

Labels: Candy Store Generation, Had Enough Generation, The Panic of 2008

This from Commentary's Jennifer Rubin:

Perhaps the most intriguing and least easy to categorize speech at CPAC came from Newt Gingrich. It was the most partisan of assaults and the least pro-Republican in advocacy. It was the most raucous and the most sober. And it was not clear whether it was the opening of a presidential campaign, a political movement, or just a graduate course on political science.

First a word about tone and presentation. It is an art to give a speech to a large room packed with supporters and not talk in “speech” voice with awkward phrasing, trite lines and predictable timing. Gingrich has a well-modulated voice and the ability to deliver biting sarcasm without a sneer. He spoke in conversational language and in quiet tones and held the room in the palm of his hand.

But he didn’t start that way — entering from the back of a jammed room like a candidate, or perhaps the president entering the House of Representatives. Ah, I thought, this is the presidential campaign starter. But maybe not.

He was relentless in attacking the president, Nancy Pelosi (whom he teased mercilessly about popping up to applaud the president’s speech before he completed the applause lines) and the Obama administration. He began by excoriating Eric Holder for his comments that Americans were “cowards” and declared that he “welcomed the opportunity to have a dialogue with you about cowardice anytime and any place.” He then suggested Detroit where they could chat about failed government, failed bureaucracy and failed schools.  He declared that we “should be committed to liberating the people of Detroit.

But his sharpest criticism was reserved for liberals and the president. Reading from the New York Times, which declared that the new budget “sweeps away Reagan’s ideas,” he mused that the Times certainly hoped so and had suffered great disappointments –the Soviet Union disappears, private industry thrives, big government fails and they lost readership. He deadpanned :”It was great 25 years.”

His ire was mostly directed at the Obama budget, which he says is an effort to “create a European model.” And his language was harsh. ”The administration thinks we’re just plain dumb,” he said. ”A bill with 8,000 earmarks doesn’t count? I was looking for change I can believe in. I wonder how dumb they think we are, that they think we wouldn’t notice 8,000 earmarks.” And on tax policy he noted that Obama is “not going to raise taxes on anyone making less than $250, 000–unless they use electricity.” Or other fuels.

But the heart of a speech was call to make the  2010 and 2012 elections “the most consequential in U.S. history. ” He declared, “Every person who didn’t read the stimulus —  everyone of them deserves to be defeated.” But this was not a Republican call to arms per se — indeed, this is where it got interesting. In his vision, Obama is part of the “failed Bush-Obama” policies of big government, lots of bureaucracy and high taxes. That’s the political or intellectual exercise he is engaging in and asking others to engage in — Obama is the past ( already!) and part of the failure of big government.  Gingrich’s movement, by contrast, is the low tax, anti-bureaucracy, pro-jobs “American party.”

Unlike Ronald Reagan, Gingrich isn’t per se calling Democrats and Independents to join the Republican party. No, he’s is calling for a “tripartite” movement to oppose the failed Obama/Bush regime. A true third party? Or a stealth presidential campaign? It wasn’t clear.

Gingrich was in top form today. However, it is not altogether clear, other than throwing out the Democratic Congressional majority, what he is up to. And perhaps he hasn’t quite decided himself.

I think he has decided and knows just what he's doing.

Labels: 2012 Election, Age of Obama, Bailouts, Economic Cycles, The Panic of 2008

Today, for the seventh time in my career, I survived a corporate layoff (actually the 8th if you include the 1975 episode, but those were transfers to avoid layoffs). Today we went from a firm of 140 or so people to a firm of 105 people, plus or minus a couple. I will have another 10 percent pay cut (after the 10 percent pay cut I took last April), the three upper managers are taking another 15 percent pay cut after the 30 percent cut they took last April.

These cuts are deep. A couple of single moms are now gone. A couple of promising non-professional-level staff are gone. Our CFO will have to pick up her accountant's tools again. I will have to be more involved in projects and try to bill time, rather than being 100 percent overhead.

I have news for my senators and congressmen, for Pelosi and Reid, and for Barrack: The stimulus package you all are mindlessly shepherding through a glazed-over Congress is not going to work. It is pork, pure and simple. It is money for every failed plan from the last six decades.

What we need now is tax relief, not in 2009 but in 2008. Immediately Congress should pass a tax cut retroactive to January 1, 2008. Every tax bracket, every income level, corporate and personal. Cut rates, increment brackets. Index exemptions. That will put money back in people's hands in a jolt, and do more than all these programs.

How can this be done retroactively? Especially after all the tax packets for 2008 have been mailed? Easy: Clinton rammed a retroactive tax increase through Congress in 1993, so the precedent has been set. Just do it, and let the bloated bureaucrat bags at the IRS figure out how best to disseminate the information.

Labels: Bailouts, The Panic of 2008

I am getting so sick of people blaming the current financial situation on Bush. He is no more responsible for this than Clinton was for the minor recession Bush inherited, or the elder Bush was for the recession in the latter years of his term, or even than Carter was for the multiple economic problems during his term.

Economic booms and the following panics/depressions/recessions/slowdowns--call them what you will--happen mainly because of demographics. This fact was explained in Harry S. Dent’s book The Great Boom Ahead. This book explained how the rise and fall of birth rate throughout American history coincided very nicely with economic cycles 45 years later. Dent attributed this to the fact that a family reaches it's peak spending years about when the parents reach 45, or maybe 47 for a generation that began their families a little later. At that point, families break up and new families start. New families don’t yet have the buying power their parents have, and so spend less. Since consumer spending accounts for at least two-thirds (if not three-fourths) of the economy, by tracking the number of births, you can track the number of 45-47 year olds, and you can tell when your economic peaks and valleys will be. That is Dent’s theory. Other factors may drive the severity, or hasten or delay the event, but demographics is the main driver.

In The Great Boom Ahead, Dent showed charts of birth rates, and the peak of the baby boomers happened in 1961. Using 47 as the peak spending year for a generation that tended to marry later, he showed that 2008 was a possible start of an economic downturn, a severe one, that would last until 2016, corresponding to 47 years after the uptick in births when the youngest wave of boomers began having children.

Could all this be true? Consider the severe depression we had in 1973-74. The Arab oil embargo and corresponding spike in gasoline prices probably had something to do with that. But 45 years before that was 1928, right before the start of the Great Depression, before dads and moms might have decided they couldn’t afford to have more kids, and at the end of a lesser baby boom that followed World War 1. What about the 1980-82 recession? Forty-five years before was 1935, the darkest part of the Depression, when the birth rate was fairly low.

I'd need charts in front of me to do more correlation, but Dent has convinced me. Now, I know that he fell out of favor in the '00 decade, when he tried to apply his theories of economic booms and busts to specific target amounts for stock indices. Shame on him for not sticking to what he knew best. Events have turned out to prove him correct on his basic assessments.

Since birth data is available in the USA only since 1911, that can't be used to assess the cause of the Great Depression. Or can it? If data isn't available, at least we know history and can speculate with some reasonable accuracy what events did to the birth rate. The Wall Street collapse was in 1929, the depression began probably in 1930. Count back 45 years before 1930 and you have 1885--twenty years after the end of the Civil War, and probably at the peak of the baby boom that surely must have happened after that war ended, the war that had the highest percentage of our population off on the battlefield. The Civil War boomers, if I may call them that, probably had their peak birth rate around 1885; I bet this was followed by a number of years, perhaps as long as a decade, of reduced birth rate, until their children began having a lot of children. Hence the number of 45 year olds must have greatly diminished around 1930. And voila, a depression that last a decade, ending as much from the increasing number of adults approaching age 45 as the outbreak of war, and less to do with New Deal meddling, possibly even overcoming New Deal meddling.

So, the current economic situation is not due to anything George Bush did or did not do. It is due to the end of peak spending by the largest wave of Baby Boomers. And it is right on schedule. Look for the USA to climb out of it around 2016, again right on schedule. And all the tinkering that GWB has fallen into, and that Paulson is wrecking with relish, and that Obama plans to expand with glee, will have no positive impact.

Labels: Economic Cycles, The Panic of 2008

Taken from today's WSJ, and put in table form to make review and decision making easier.

 

	Both	McCain	Obama
Short Term Economic Relief		Sen. McCain proposes cutting the capital-gains rate on stock held for more than a year to 7.5%. He also would increase the amount of stock loss that is deductible against ordinary income from $3,000 to $15,000, and would tax withdrawals by seniors from IRAs and 401(k)s no more than 10%.	Sen. Obama proposes a $1,000 Emergency Energy Rebate to families ($500 for individuals) and penalty-free withdrawals of 15% from 401(k)s and IRAs up to $10,000. He also wants to temporarily suspend minimum distribution requirements for retirement accounts.
Income Taxes		Sen. McCain wants to permanently extend all 2001 and 2003 Bush tax cuts, raise the personal exemption for each dependent from $3,500 gradually over several years to $7,000 and keep the top tax rate at 35%, leaving "upper-income taxpayers" with "the most to gain under McCain's plan," according to a report by Deloitte Tax. The nonpartisan Urban-Brookings Tax Policy Center estimates that the top 1% would see a tax cut of more than $125,000.	Sen. Obama favors tax cuts for middle-class workers and tax increases for top earners -- families that make more than $250,000 and individuals making more than $200,000 a year. He wants to extend most of the 2001 and 2003 Bush tax cuts, but raise the top two marginal rates to 36% and 39.6%.  Sen. Obama wants to eliminate taxes on seniors making less than $50,000 a year and to provide a "Making Work Pay" tax credit of 6.2% of the first $8,100 in wages (about $500) for individuals earning less than $75,000 a year. Outside analysts estimate that the top 1% of wage earners would see an average tax increase of $19,000.
Estate Taxes and AMT	Both candidates support extending the Alternative Minimum Tax's 2007 "patch" exemption levels and index for inflation, and changing the federal estate-tax law to make the $2 million per-person exemption ($3.5 million next year) portable or transferable from one spouse to another.	Sen. McCain has proposed a 15% estate tax (down from the current 45%) on roughly 0.2% of estates, those valued at more than $5 million per person. A $5 million estate would pay nothing under this plan, Deloitte Tax notes.	Sen. Obama wants to freeze the 2009 estate-tax structure, which taxes roughly 0.3% of estates -- those valued above $3.5 million per person -- at a top rate of 45%. According to Deloitte Tax, a $5 million estate would pay a tax of $675,000 under this plan.
Health Care		Sen. McCain wants to replace the current income-tax exemption for health-insurance premiums paid by employers with a refundable tax credit of $5,000 per family ($2,500 for individuals). Any unused credit could be deposited into a Health Savings Account. His Guaranteed Access Plan (GAP) would allow people denied coverage to obtain insurance through state-run high-risk pools administered by private insurers, according to a report issued by the Joint Center for Political Economic Studies. Sen. McCain wants to allow people to purchase insurance across state lines, which could reduce the effectiveness of state regulations.  Under this plan, premium payments for families would increase by about $379 and direct payments for health services by about $105. "This would be more than offset by a net increase in tax subsidies of $1,570" and wage gains resulting from employer savings, the Lewin Group says.  The Lewin Group projects that the McCain plan would reduce the number of uninsured by 21.1 million people.	Sen. Obama proposes income-related subsidies for health insurance through a new national exchange, along with expanded access to Medicaid and the State Children's Health Insurance Program, and mandatory care for children. He would require employers that don't offer health coverage to contribute a percentage of payroll toward the national plan, with small businesses being exempt (and eligible for refundable tax credits on 50% of premiums).  Under this plan, premium payments for families would fall by about $185 and direct payments for health services by $253. The Lewin Group projects the Obama plan would reduce the number of uninsured by 26.6 million people in 2010, from 48.9 million.
Investments	Both candidates offer plans to support small businesses, but they offer different strategies for capital gains, dividends and retirement savings that will affect investors.	Sen. McCain calls for maintaining the 15% top tax rate on dividends and long-term capital gains.	Sen. Obama wants to eliminate all capital-gains taxes on start-ups and small businesses but raise the top long-term capital-gains rate on securities and qualified dividends from 15% to 20% for families making more than $250,000 a year ($200,000 for individuals). He wants to tax carried interest as ordinary income.
Retirement & Social Security	Both candidates have moved to temporarily suspend the requirement that people over age 70½ tap their retirement accounts, but neither candidate has offered a substantial long-term plan to overhaul the way Americans save for retirement.	Sen. McCain favors privatizing Social Security in programs that allow younger workers to place a portion of their payroll taxes into personal accounts invested in the market.	Sen. Obama wants to institute a 2% to 4% payroll tax on incomes above $250,000, split between employer and employee. It would take effect in 10 years or more. He also proposes a retirement-security plan to automatically enroll workers in a workplace pension plan.  Employers that don't offer a retirement plan would be required to enroll employees in a direct-deposit individual retirement account. Sen. Obama also proposes a saver's credit to match 50% of the first $1,000 of savings for families earning less than $75,000.
Source: WSJ

Labels: 2008 Election, The Panic of 2008

From the WSJ

People always underestimate how bad things can get. So advised a guy who made millions as a short seller in the 1980s. His insight certainly is borne out in the continuing market selloff -- and one reason is the incentive for political actions that actually make things worse.

BARACK OBAMA

Raymond Moley, a New Dealer who ended up dissenting from the Roosevelt administration, voiced a well-founded fear that FDR and his brain trust were more interested in exploiting the crisis to expand their political majorities and centralize power than in getting the economy growing again. David Kennedy, the Yale historian, forthrightly addressed these considerations in his book "Freedom from Fear." Amity Shlaes, in her recent "The Forgotten Man," pushed the analysis further. Sadly, these are brave exceptions, because arguing about the FDR legacy is tantamount to taking sides in current political contests. Ben Bernanke has learned the monetary lessons of the Great Depression, but the political class is largely ignorant of how the disaster was prolonged by tax and regulatory policy out of Washington.

Our next president is likely to be a guy with some book learning and all the life lessons you can gain from three terms in the Illinois state senate. He's already besieged by excited advocates of a "New" New Deal, a vast expansion of federal responsibility to assuage the supposed insecurity of the Middle Class. Except there's a problem: Washington over the past 70 years has not surrendered the Middle Class to the law of the jungle but already made it dependent on government for retirement income and health care for fully a quarter of the average person's adult life. Without any change in policy or bold new initiatives, we will soon have European-like levels of taxes and government spending to meet these commitments. We don't have a crisis of insufficient government as (arguably) we did in the 1930s. We have a crisis of too much government -- an insight likely to be lost on anyone afflicted with indiscriminate FDR idolatry. Forced selling by hedge funds undoubtedly plays a role, but the market cannot but be discounting the likely outcome of the presidential election: An Obama landslide that would sweep from the table any nonstale vision of a path to the future based on privatization, personal savings and curing the third-party-payer illness of our health care system.

Labels: 2008 Election, The Panic of 2008

From Forbes:

Thomas Cooley 10.15.08

What's the difference between a financial crisis and a Depression?

At least initially, the symptoms appear similar. Banks won't lend to one another, even overnight. Strong and respected businesses cannot borrow short-term money in the commercial paper market even though their default rates are negligible. The banking systems in many countries have ceased functioning and required major government intervention. It is like a patient experiencing multiple organ failure because the basic circulatory system has gone kaput. Despite urgent measures, the patient appears unresponsive.

Yes, it's that bad ... but is it the beginning of another Great Depression?

That question has been posed repeatedly--and often feverishly--over the past several weeks. The answer--and I don't mean to be theatrical--is "No ... but ..." So first, let's talk about the "no," and then we'll come back to the "but."

The current situation in the U.S. economy is not even slightly good. The financial crisis is global, and real. Nevertheless, the impact on the "real" U.S. economy is not yet dire. To date, more than 700,000 jobs have been lost, and we can expect more, but some perspective is in order.

The losses to date represent less than .5% of the work force. In the relatively mild recession of 2001 to 2002, job losses equaled about 1% of the work force. In the much more severe recession of 1981 to 1982, job losses totaled nearly 3% of the labor force--six times today's figure. And in the (truly) Great Depression--invoked, now, with an alarmist frequency--job losses between 1929 and the trough in 1933 were 21% of the labor force; and by 1939, total employment remained 13% below 1929 levels.

Output in the Eurozone economies, as well as Britain, Japan and others, is shrinking; but measured output in the U.S. has yet to decline in the current slowdown. I believe it will shrink, but in the Great Depression, real output shrank by 38% between 1929 and 1933 and remained well below trend for a decade.

Evidently, we are a long way from a Great Depression.

Now, given the amount of hand wringing that is going on, some of you will assume that I'm channeling Mr. Micawber, one of literature's most hapless optimists. The situation is serious, and something has to be done. Unlike Mr. Micawber, I don't expect that "something will turn up."

Rather, I want to ask the more important question: What do we know about the road that leads from a financial crisis to a severe and prolonged downturn--and how can we avoid it?

The American Great Depression of the 1930s is the most familiar--and most studied--economic collapse, but it is important to know that it is not the only one. Other countries suffered prolonged downturns in the 1930s, and many, including Japan, Mexico, Chile, Argentina, Brazil, New Zealand, Switzerland and Finland have experienced prolonged episodes of below-trend output in the period since the Great Depression.

The book Great Depressions of the Twentieth Century, edited by Timothy Kehoe and Edward C. Prescott, contains studies of depressions in 14 countries. Harold Cole and Lee Ohanian have done the most in-depth recent research on the American Great Depression, as well as the long decline in the U.K. economy. There is also a terrific book by Amity Shlaes, The Forgotten Man, which reexamines the roots of the Depression.

With all of this scholarship, what do we know about why depressions--whether in upper, or lower, case--occur?

Not surprisingly, there isn't one story that fits all of them, but there's a common theme that emerges: It is that unwise policy choices made in the throes of a crisis exacerbate and prolong the real downturn associated with the crisis. In particular, government policies that affect productivity and hours of work are most often responsible for throttling economic growth.

That this was true in our Great Depression is now clear. While earlier historians focused attention on the failures of monetary policy, and on the distortions caused by the Hawley-Smoot tariffs, evidence now points more strongly to policies that tried to keep wages artificially high (under Hoover and then Roosevelt) and to cartelize industry (under Roosevelt).

OK, now here's the "but" part: Policies matter. Roosevelt was viewed as a great activist leader during the Depression. In fact, he was a great experimenter, willing to try one thing, then another, to turn the country around. The result was an economic downturn that lasted for many years longer than it might have.

For many decades following the Great Depression, conventional historians viewed the crash as a failure caused by laissez-faire policies, rampant speculation and the incompetence of people like Hoover and Andrew Mellon. They attributed the subsequent recovery to the inspired leadership of Roosevelt and to the role of the government in directing economic activity. We are beginning to hear these rumblings again, along with rhetoric that is hostile to trade, globalization and immigration, not to mention a mounting distrust of markets.

These are easy populist positions to adopt, but they are dangerous and false--even dangerously false--because policies matter. They matter deeply, and once adopted, it is extremely hard for the country to change course. Can the current leadership in Washington right the ship enough to forestall a head-long rush into a catastrophic storm? This writer is optimistic--guardedly--that good sense will prevail. But he is not, as yet, a Micawber.

Thomas F. Cooley, the Paganelli-Bull professor of economics and Richard R. West dean of the NYU-Stern School of Business, is a weekly columnist for Forbes.com.

Labels: The Panic of 2008

Bill Kristol had a good idea which he expressed in his regular column at the NY Times:

It’s time for John McCain to fire his campaign.

He has nothing to lose. His campaign is totally overmatched by Obama’s. The Obama team is well organized, flush with resources, and the candidate and the campaign are in sync. The McCain campaign, once merely problematic, is now close to being out-and-out dysfunctional. Its combination of strategic incoherence and operational incompetence has become toxic. If the race continues over the next three weeks to be a conventional one, McCain is doomed.

He may be anyway. Bush is unpopular. The media is hostile. The financial meltdown has made things tougher. Maybe the situation is hopeless — and if it is, then nothing McCain or his campaign does matters.

But I’m not convinced by such claims of inevitability. McCain isn’t Bush. The media isn’t all-powerful. And the economic crisis still presents an opportunity to show leadership.

Best part comes at the end,...

McCain should stop unveiling gimmicky proposals every couple of days that pretend to deal with the financial crisis. He should tell the truth — we’re in uncharted waters, no one is certain what to do, and no one knows what the situation will be on Jan. 20, 2009. But what we do know is that we could use someone as president who’s shown in his career the kind of sound judgment and strong leadership we’ll need to make it through the crisis.

McCain can make the substantive case for his broadly centrist conservatism. He can explain that our enemies won’t take a vacation because the markets are down, and that it’s not unimportant that he’s ready to be commander in chief. He can remind voters that even in a recession, the president appoints federal judges — and that his judges won’t legislate from the bench.

And he can point out that there’s going to be a Democratic Congress. He can suggest that surely we’d prefer a president who would check that Congress where necessary and work with it where possible, instead of having an inexperienced Democratic president joined at the hip with an all-too-experienced Democratic Congress, leading us, unfettered and unchecked, back to 1970s-style liberalism.

At Wednesday night’s debate at Hofstra, McCain might want to volunteer a mild mea culpa about the extent to which the presidential race has degenerated into a shouting match. And then he can pledge to the voters that the last three weeks will feature a contest worthy of this moment in our history.

He’d enjoy it. And he might even win it.

But Kristol should have added, "if, that is, he is ready, willing and able to adjust his campaign radically to such an approach, and still that doesn't guarantee a victory, it just might give him a better shot."

Labels: 2008 Election, Terrorism, The Panic of 2008

In a post this morning in the Corner at National Review Kathryn Jean Lopez said, "Americans should be taking a second look. Will they? Wake up, America. Good morning. There's still an election going on. Contrary to Obama-Pelosi-Reid posturing, it ain't over yet."

I wish I could agree, and in fact there are another, what? 25 days or so? But on today's Meet the Press, I witnessed rare agreement between guests (conservative) Paul Gigot of the WSJ, (liberal) John Harwood of the NYT, Ted Koppel of Discovery Channel and Erin Burnett of CNBC.

What were they in agreement on?

(1) That the economy and the current financial crisis / panic has completely eclipsed all other issues in the minds and hearts of the average voter.  And who can blame them for concern for their jobs, keeping their homes, and being able to afford retirement with their 401K's dropping to half their value in the last 10 days?

(2) That the McCain campaign is uncomfortable moving the strategy of his campaign from one of "experience and character" to "the economy," an issue about which he admitted early on of not being the brightest light in the tree, and an issue he has proven to be spastic at best and incomprehensible at worst. McCain has jerked around with various approaches and strategies, many of which seem and are contradictory as he has attempted to maneuver through the recent change in climate.

(3) That neither candidate has really offered any substantive policy or major construct that would begin to address the current cataclysm. And let me stress that: neither have done so. When Harwood was confronted with the question of what substantive initiative has Obama offered, his answer was that Obama, with McCain, voted for the "rescue" package in the Senate.  Apart from that, not really very much of anything else.

(4) Nonetheless that Obama is still the ONE perceived by voters as the best to handle the economic crisis.

Not withstanding, these observations are valid even though Obama has no record indicating he'd even have the character to have a chance to deal effectively with a crisis. He didn't even deliver on a promise to cut taxes in Illinois.  I don't know about you all, but his meager record doesn't build my confidence in him, but voters are so emotional right now, they want to flip the card over, not really knowing what's on the other side. This is the real tragedy, that voters are jumping on the Obama bandwagon, not knowing from whence it came, and really where it will take them, except if the voter does its homework - which it is too distracted to do - they would see that Obama's meager record of non-action (some say he wasn't even good at community organizing, whatever that means), his radical socialistic leanings, all of these indicators are apt to take them in a disastrous direction, but I think that's where we're going.  Like it or not.  It's too late to wake up. 

It is no longer morning in America.  We've awakened to the beginnings of a long night, and one that will linger and be exacerbated by unknown, unproven leadership with clear indications that it will have at least anti-free-market values, accompanied with a veto proof liberal congress, and a gradually left swinging Supreme Court peppered with new judges who will read new interpretations to social issues like gay marriage and assisted suicide. Welcome to the coming long and rainy night.

Labels: 2008 Election, The Panic of 2008

I think McCain's "I'm a maverick with a history of bi-partisanship" is getting really old and tired.  Why isn't he angry?  Why doesn't he emote and feel for the people.  The question (below) could have been knocked out of the park.

Labels: 2008 Election, The Panic of 2008

I don't see what energy independence has to do with the immediate crisis, and I don't understand why McCain is bringing that up now.

McCain is also bringing attention to his failed tactic of suspending his campaign to go to Washington, and since that time, everything has gone even further into the hand basket.

Whoever coached McCain missed all the choice preparation we've been sharing up to now.

Bill Bennett on CNN said the candidates should explain concisely to the American people what they believe has happened, and then, with empathy, explain how they will get us out of it.  So far, only Obama is doing the explaining.  What is McCain thinking?

Labels: 2008 Election, The Panic of 2008

I'm quickly coming to the cold realization that the Panic of 2008 is hurting McCain simply because he is a Republican, and it is probably all over but the crying for the McCain - Palin ticket, but here is one idea from David Gelernter at the Weekly Standard that could possibly keep hope alive - I could hear him say these words, it would be like him to say them:

What McCain Needs to Say

McCain might break through the media fortress that protects independents from the truth if he'd repeat a small packet of information word-for-word at the end of every single speech. Soon crowds would anticipate these words and reporters would know them by heart, and they'd start making an impression on the country. Here are mine; but whatever words he chooses, he must start hammering home some simple truths right now.

1. Mr. Obama is the most liberal senator in Washington.

2. Like other liberal presidents, he'd load the Supreme Court with the most liberal judges he could find.

3. Like other liberal presidents, he'd spend tax dollars like they were going out of style--when the economy must have a steady, experienced, pork-hating hand at the wheel.

4. Like other liberal senators, Mr. Obama was prepared to surrender to terrorists in Iraq.

5. Like other liberal senators, he is the wrong man to protect your children against Russia, Iran, North Korea and al Qaeda in dangerous times.

6. I fought for responsible regulation of the mortgage merchants when the Democrats were against it. I don't just talk, I act.

7. My closest Senate colleague is a Democrat, Joe Lieberman. I don't just talk bipartisanship, I act.

8. I picked Sarah Palin because our country needs young leaders who don't just talk; who act.

9. I'll do what I know is right, no matter what China or Germany or the U.N. thinks. You can't protect this nation by talking. You have to act.

10. Don't judge me as a politician or speech-maker. Judge me as a man who is more than talk. I would lay down my life for this country.

Labels: 2008 Election, The Panic of 2008

Obama has a new TV ad, new to me at least, that implies that McCain will reward businesses with tax breaks as they malevolently move jobs from the homeland to low cost countries. The implication is that it is wise and just to give tax breaks to us middle class folk directly instead - something about which I am incredulous coming from a tax and spend liberal.

Where does one begin disassembling the knot of snakes in something like this ad, a big fib that only takes 10 seconds or less to state, and repeat over and over in network television ads? And as an old Russian proverb states, "repetition is the mother of propaganda."

First of all, businesses, large and small, are being driven to low cost countries because of the enticement of low cost labor, but even more compellingly, through tax incentives from those low cost countries who draw them to come and commit to their country with jobs and cash - and over the past half dozen years or so, American businesses were pulled into that. Raising US taxes on such businesses is not going to dissuade them from seeking cost control, but what it will do is cause such business to lose their competitive edge in a global economy, and ultimately result in their decline. And when businesses like these decline, it will mean a further loss of middle class jobs.

What we should do to provide incentives to US businesses to encourage the movement of jobs back to the US is to provide them with tax incentives to reverse the trend - which is the very thing Obama demagogues against. And even that wouldn't be enough in a world economy, but it is better than letting the whole house of cards to fall in a time of declining equity values, affecting people's pensions and personal savings.

Is this economic wisdom? Is this economic leadership? The pundits tell us the it is "still the economy, stupid," and I would agree that declining 401 K values, bankrupted banks and the sudden fall of huge 100 year old financial giants tends to center the mind on this subject, but I hope the American people are wise enough to differentiate economic demagoguery from economic wisdom.

Voters may like Obama's calm demeanor and cleaver articulation, but what of his ideas? Are they right? Are they workable? Are they practical? And what has history taught us about them?

The Hillary Clinton campaign determined a way to differentiate between her more substantive approach to Obama's in the closing days of the Democratic primary. She started to close the gap, particularly in the big industrial states like Pennsylvania. The McCain campaign would be wise to step on the same gas pedal. Instead they're yapping about Obama's relationship to Ayers. I don't think the people care about these things right now.

Follow the Money.

Labels: 2008 Election, The Panic of 2008