Friday, April 27, 2012

Last Call

The Great Shrill One rises from the depths of reason to infect the Austerians with his beard-tentacles of sanity and common sense and tells a little bedtime story about a fairy (rent asunder by his self-same beard-tentacles, no doubt.)

Critics warned from the beginning that austerity in the face of depression would only make that depression worse. But the “austerians” insisted that the reverse would happen. Why? Confidence! “Confidence-inspiring policies will foster and not hamper economic recovery,” declared Jean-Claude Trichet, the former president of the European Central Bank — a claim echoed by Republicans in Congress here. Or as I put it way back when, the idea was that the confidence fairy would come in and reward policy makers for their fiscal virtue.
The good news is that many influential people are finally admitting that the confidence fairy was a myth. The bad news is that despite this admission there seems to be little prospect of a near-term course change either in Europe or here in America, where we never fully embraced the doctrine, but have, nonetheless, had de facto austerity in the form of huge spending and employment cuts at the state and local level.
So, about that doctrine: appeals to the wonders of confidence are something Herbert Hoover would have found completely familiar — and faith in the confidence fairy has worked out about as well for modern Europe as it did for Hoover’s America. All around Europe’s periphery, from Spain to Latvia, austerity policies have produced Depression-level slumps and Depression-level unemployment; the confidence fairy is nowhere to be seen, not even in Britain, whose turn to austerity two years ago was greeted with loud hosannas by policy elites on both sides of the Atlantic.

And with Spain and now Britain's Q1 GDP numbers showing big fat recession signs (and a healthy chunk of the Eurozone following suit at this point) the notion that "austerity is the answer because it creates certainty and confidence!" is about as dead now as Sarkozy's chances in France's upcoming elections.  Poor little Confidence Fairy didn't have a chance, you know.  You didn't clap loudly enough, Europe.  (Austerity can only be failed...)

Never forget of course that for the last several years, the "serious" people have been telling us that we had to follow suit or face economic ruin.  US GDP numbers for Q1 came out this morning at 2.2% growth, and while that's down from 4Q 2011's 3.0%, it's still better than what Europe's austerity cultists are feeding upon right now.  Our own zombie-eyed granny starvers (thanks, Chuck) have told us for years now that this was necessary if not vital to our survival, and failure to do so would mean another financial crash.  Meanwhile, the actual application of throttling the spender of last resort in several European countries has -- surprise! -- led to a double-dip recession with no end in sight and even more cuts called for.  We need more of the same stuff that not only isn't working, it's causing more problems.  That never happens with conservatives and economics.

Yet, we face the same exact calls here from Republicans and more than a few Democrats.  They're hoping you don't pay any attention to the fact that what they've said we have to do has been tried and is currently failing miserably in Europe.  Mighty Krugthulhu has of course been saying this for a while now, and all but ignored in the halls of power.  It's looking like that particular era may be coming to an end and none too soon.  Maybe those steely gray beard-tentacles of his can latch on to a few heads and extract the Stupid while he's at it.

What a fairy tale that would make.  Ia! Ia!

Nationally Lampooned Vacations

Conservatives continue to attack Michelle Obama as proxy to her husband, this time over the idea that in a bad economy, the Obama family shouldn't dare go anywhere lest they draw the ire of swing state voters in Republican focus groups.

“They view everything through their own personal situation and if they can’t afford to do it, they can’t enjoy it, they don’t like Obama using their tax dollars to benefit himself,” said pollster John McLaughlin. “In this case, they see him as out of touch. While they are struggling he’s not sharing in that struggle and he’s basically doing what they can’t do on their tax dollars,” added the GOP pollster.

He and several other top-tier Republican pollsters, organized by Resurgent Republic, traveled to 11 battleground states to host focus groups of independent and swing voters, mostly Democrats, who voted for President Obama in 2008 but who are now on the fence.

McLaughlin handled blue collar and Catholic voters in Pittsburgh on April 3 and Cleveland on March 20. He found that they are very depressed about the economy and feel that their tax dollars are being sucked up by both the rich and those living on government assistance.

During the focus group discussions about debt and spending cuts, many in his group volunteered criticism of the presidential vacations as something that should be cut. Among the lines McLaughlin wrote down was one from a Democratic woman who said, “Michelle Obama spends $1 million to take the kids to Hawaii,” and another who said, “President Obama was the only president to take so many trips.”

The theme, said McLaughlin, is that the first family “is out of touch” with working class voters.

What the focus groups are really proving is that the FOX News style propaganda attacks on our "uppity" First Family who should "know their place" and not be so "lazy" and "go on vacation so much" are working with the intended target, at least to some extent.  The First Lady in particular has been savaged for spending "millions" on pricey vacations and top-shelf fashions, all supposedly on the taxpayer dime.

There are two things wrong with it.  One, the costs include security for the First Family, and given the unalloyed hatred these assholes have for the Obamas, I'd say that security is pretty necessary, possibly more necessary that with any other residents of the White House before them.  Second of all, President Obama and Michelle Obama have still taken far less vacations than the Bush family preceding them.  Laura Bush took yearly trips to Yosemite National Park with family friends and Secret Service protection.  The total cost of just the White House trips to the Bush ranch in Crawford, Texas?  Some $20 million for just the plane costs.

President Bush took 149 trips to Camp David, 77 visits to his Crawford ranch, and 11 trips to his father's Kennebunkport mansion. Since Air Force One reportedly cost $56,800 per hour to operate in 2004 (which Bush used to get to Crawford), and the plane can travel up to 630 miles per hour, it cost at least $259,657 to get the 2,880 miles to Crawford and back, each time Bush went, or roughly $20 million dollars just for taking the plane on the Crawford trips alone. Add in the cost of putting up Secret Service and other staff for the ranch trips, as well as the Kennebunkport and Camp David trips, and you get, well, a lot. 

That's okay, because it's not like Bush crashed our economy or anything while he was busy clearing brush.  There's one big difference in Presidential history when it comes to the Obama family, and that's what these Republican pollsters are pushing among working-class Democrats, trying to get them to abandon the President for being too "elitist" and instead vote for the guy worth a quarter-billion dollars with the multiple vacation homes and cars...or not vote at all.

But don't you dare bring the issue of race into it.

Chart Of The Day

From Ezra Klein, who puts the austerity hysteria to rest:

The yellow line is America.  The red line, the UK, has been stagnant since David Cameron's government game to power in 2010 and appears now to be permanently stuck at 2006 levels.  the entire Eurozone too appears to be heading into stagnation if not outright recession.  Both economies said austerity was the answer.  Both economies are now stuck below their January 2008 peaks where the US and its stimulus package has -- surprise!  Gotten us ahead of the curve and now above where we were in 2008. 

If we had listerend to the GOP and cut spending massively like they demand we do, we would be in the same recessionary boat as Europe.  Period.  If they get into power in 2012, they will do to our economy what conservatives in the UK and the Eurozone did to theirs.  As it is, please note that our economy did stagnate in late '10/early '11 for a couple months there as the new GOP House took power and we ended stimulus spending programs rather than continue them (which was politically impossible).  The President then turned to other methods to boost the economy and you see the curve upwards during the end of last year as things resumed improving despite the GOP trying to sink the economy.

Any questions?

This Is Personal

President Obama wrapped up his two-day tour of college campuses today at the University of Iowa, again calling on Congress to extend a low interest program for student loans.
"This is personal," Obama said while discussing the value of a college education. "This is the heart of who we are."
The president, who said he and wife Michelle just paid off their own student loans a mere eight years ago, also told a friendly crowd of students that "we've got to make college more affordable for more people."
Obama is working hard to bring young people on board.  He wants them to know that an education should be attainable, and not just for the top 10% of whatever dividing line that might prevent higher education.  It's not about money, it's about investing time and energy into being better people, and better citizens.  More education leads to better ideas, better worker, enlightened minds that hatch brilliant ideas.

He is also bringing a new generation into politics.  Young adults are impressionable, and by lending a sense of urgency that is relevant to them, Obama is bringing in young people who will likely take more of an interest in their country.  He isn't promising all of our dreams will come true, just that we should be able to access the tools to make them a reality.

And on the other side we have... Mitt Romney.  The rich boy who thinks it's snobbery for Obama to want education accessible to everyone who wants it.  The guy who thinks women are breeders whose medical choices are up for legislation.  The guy who says he's hip to women's needs because his wife says so.

Talk about no contest.

Saving Truman

This is one instance in which sad puppy eyes really come in handy. A four-year-old Golden Retriever, "Truman," was rescued by Los Angeles Sheriff Department's (LASD) volunteer deputies Sunday. The dog was suffering from dehydration and cut paws while hiking Switzer Falls with his owner, according to the station's press release.
The Crescenta Valley Sheriff’s Station received a call at about 6:30 p.m. Sunday and assigned reserve deputies from the LASD Montrose Search and Rescue Team to the mission.
Rescuers hiked deep into the Angeles National Forest, placed Truman on a gurney and wheeled the poor guy all the way to his owner’s vehicle.
It just made me smile when I read this.  I've gone through incredible lengths (and more than one bribe) to help animals who are in pain.  Though they don't tell just how his paws became injured, whether it was from the terrain or one specific thing, but the response and the caring shows that good folks do good things.

Thanks, guys.  I needed that.

Cleaning Up A Very Old Mess

Spencer Ackerman over at Wired's Danger Room reports on the Pentagon cleaning house on how it trains our armed forces to deal with Islam.  It's no longer the enemy and treating all Muslims as potential terrorists was never going to work.  Some ten years on in our Endless War, we finally get that fact.

The chairman of the Joint Chiefs of Staff on Tuesday ordered the entire U.S. military to scour its training material to ensure it doesn’t contain anti-Islamic content, Danger Room has learned. The order came after the Pentagon suspended a course for senior officers that was found to contain derogatory material about Islam.

The extraordinary order by General Martin Dempsey, the highest-ranking military officer in the U.S. armed forces, was prompted by content in a course titled “Perspectives on Islam and Islamic Radicalism” that was presented as an elective at the Joint Forces Staff College in Norfolk, Virginia. The course instructed captains, commanders, lieutenant colonels and colonels from across all four armed services that “Islam had already declared war on the West,” said Lt. Gen. George Flynn, Dempsey’s deputy for training and education.

“It was inflammatory,” Flynn told Danger Room on Tuesday. “We said, ‘Wait a second, that’s really not what we’re talking about.’ That is not how we view this problem or the challenges we have in the world today.”

The strong response by the Pentagon brass illustrates growing sensitivity around the issue since Danger Room’s investigation of anti-Islam material in the FBI’s counterterrorism training last September. That story sparked strong condemnation of the training material from the U.S. Attorney General on down, and prompted the White House to order a review of U.S. counterterrorism training last October.

Despite that White House order, the “Perspectives” course, taught since 2004, not only evaded review, but had defenders in the Joint Forces Staff College that taught it.

I may not agree with everything Ackerman believes about the Obama administration's domestic policy, but he's been the most solid foreign policy, military, and national security beat reporter out there for some time, so when he delivers an article of this magnitude, it's worth your time to go read the whole thing.

As far as the Pentagon goes?  About damned time.  Reversing a decade of "raghead sunzabitches" as DoD policy always had to be a vital step towards our evolution in dealing with the Middle East.  Good for General Dempsey.  That's a strong message, and one that needs to be reinforced at every opportunity.

Home, Home I'm Deranged, Part 29

The bottom in the housing market has been called for later this year by Zillow.  Don't believe it for a second.

Online real estate marketplace Zillow said home values rose 0.5 percent in March from February, the largest monthly increase since May 2006 when the housing recession began.

Zillow’s report describing the first quarter follows two other reports about the housing market released on Tuesday.

The Standard & Poor’s/Case-Shiller home-price index showed average home prices tumbled to their lowest level in nearly a decade, after prices dropped in February from January in 16 of the 20 cities it tracks.

A separate report from the Commerce Department indicated new home sales fell last month by the most in more than a year to a seasonally adjusted annual rate of 328,000 units.  That followed a 7.3 percent increase in February.

“I think the variety of data points of housing market we’re getting this week all point to a slowly healing housing market,” Stan Humphries, Zillow’s chief economist, said. “We think of it as a bottoming process, as opposed to the bottom being a discrete point in time.”

Humphries said the “bottoming process is well under way and is made up of new home sales that have reached bottom and are starting to rebound a bit.”

The Zillow Home Value Forecast shows that national home values will fall 0.4 percent over the next 12 months, suggesting that U.S. home values could reach bottom in late 2012.


What nobody is factoring in (because it's an election year) is, as I've been saying for three years plus now, that the logjam of foreclosures still has to break before the housing market can hit bottom.  Foreclosure numbers are the only things that matter right now.  And those foreclosures are back on the rise.

Rising foreclosures are weighing on the U.S. housing market, reducing prices and keeping new-home sales weak.

Foreclosed homes are usually sold at steep discounts, thereby lowering average prices. And by expanding the supply of low-priced previously occupied homes, foreclosures tend to limit demand for new homes.

Some economists expect foreclosures to keep prices under pressure this year, even though they think sales of previously occupied homes will rise.

Banks are stepping up foreclosures in about half the states. The increase comes after state officials settled a dispute in February with five of the biggest mortgage lenders over foreclosure abuses.

"Foreclosures, excess supply and weak demand will drive home prices ... down at least another 5 percent," said Patrick Newport, an economist at IHS Global Insight.

Five percent?  More like 10% or 15%.  We still have a long way to go on housing prices, folks.  We'll see prices fall more sharply as those foreclosures stalled from last year's Foreclosuregate mess start to be processed en masse and they're free and clear to do so now that the settlement is done.  Expect the banks to rapidly pick up the pace of foreclosures this summer and fall.  Housing prices?  Look out below!


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