Last Call

Well, you know what Kentucky?  I want to know something.

There's three weeks left until the election, and I'd like somebody to answer me here:  how is cutting jobs right now going to help the economy?

Just up the road here at Northern Kentucky University, Rand Paul and Jack Conway had a debate this evening, and Rand Paul basically spent the time telling everyone how he was going to cut jobs, cut programs, cut salaries, cut oversight, cut cut cut cut cut.

Democrats have frequently challenged Republicans to name spending cuts to match their slash-the-deficit rhetoric, and one of the first questions of the debate challenged Paul and Conway to name three specific ways they would cut spending if elected. Paul said he supported a balanced-budget amendment, a "compromise from Republicans and Democrats that the entire budget is open" -- meaning all programs are on the table for potential cuts -- repealing the unspent TARP and stimulus funds, and eliminating waste from earmarks.

Conway countered that Paul's solutions "won't help us in the short term," pointing out that passing a balanced-budget amendment could take years. "We have to get about the business of actually balancing budgets," said Conway. "Now here's an area where Rand Paul talks the talk, but he hasn't walked the walk." Conway said he would allow Medicare to purchase in bulk, work to close "offshore tax loopholes and special interest provisions" that allow corporations to ship jobs overseas, and institute pay-as-you-go rules.

The questioner then challenged Paul to be more specific about what cuts are needed to help balance the budget. Paul pointed to $200 billion leftover in the TARP fund and $100 billion in the stimulus. He said that he would make "private workers and federal workers' salaries comparable. We currently pay twice as much to federal workers as we pay to private workers. ... That saves $47 billion a year. Let's also shrink the federal workforce." (The federal government, however, has argued that its employees make "on average 22 percent less than workers in similar private-sector jobs.")

Funny how that works.  Paul lied out of both sides of his mouth tonight, and he never did explain how cutting jobs and salaries will help the economy, he just took it as a given.  Not a whole lot of people in the crowd were exactly eager to back Paul up on that.

Basically for the entire night, Rand Paul mentioned things he was going to cut.  Not once did he mention anything he was going to do to actually help Kentuckians.

This race has gotten closer and closer the more people find out that Rand Paul's idea of a federal government that works is a federal government incapable of actually doing anything.

Dear America:

Time's Mark Halperin has found a 50% discount sale on apocalypse cloaks and "The End Is Nigh!" signage and wants to share with the Village cool kids.

But Obama has exacerbated his political problems not just by failing to enact policies that would have actually turned the economy around, but also by authorizing a series of tactical moves intended to demonize Republicans and distract from the problems at hand. He has wasted time lambasting his foes when he should have been putting forth his agenda in a clear, optimistic fashion, defending the benefits of his key decisions during the past two years (health care and the Troubled Asset Relief Program, for example) and explaining what he would do with a re-elected Democratic majority to spur growth.

Throughout the year, we have been treated to Obama-led attacks on George W. Bush and Dick Cheney, Rush Limbaugh, Congressman Joe Barton (for his odd apology to BP), John Boehner (for seeking the speakership — or was it something about an ant?) and Fox News (for everything). Suitable Democratic targets in some cases, perhaps, but not worth the time of a busy Commander in Chief. In the past few days, we have witnessed the spectacle of the President himself and his top advisers wading into allegations that Republicans are attempting to buy the election using foreign money laundered through the Chamber of Commerce, combining with Karl Rove and his wealthy backers to fund a flood of negative television commercials. Not only is this issue convoluted and far-fetched, but it also distracts from the issues voters care about, frustrating political insiders and alienating struggling citizens (not that many are following such an offbeat story line). Feinting and gibing can't obscure those job numbers.

Those poor, poor white, straight, baby boomer male Republicans in Washington.  Nobody will defend their right to call Obama a Muslim terrorist threat to our nation.  Nobody will defend their right to repeated block attempted solutions by the administration.  Nobody will defend their right to e-mail pictures of the President as an African tribal with doctor with a bone through his nose.  Nobody except the brave, fearless Mark Halperin.

 

Such a horrific history of repression these put-upon American heroes have had, braving this President's monstrous requests to debate his opponents on live television, his barbaric calls for bipartisan compromise, and his inhuman penchant for negotiation and diplomacy.  It borders on madness, and thank god for Mark Halperin for finally standing up for these folks in the Beltway press.  Lord knows their history in America has been that of overwhelming political helplessness.  Only 43 Presidents...and then along came this Obama person with his agenda to help people.

 

But it was an agenda that would hurt the wealthiest among us in this recession, and such intolerable cruelty of raising the marginal rate to 39.6% to those making millions a year should never be countenanced in American history.  Honestly if only Barack Obama would do everything the Republicans ask of him as quickly as possible, he would go down as the least hated Democrat in the White House since Bill Clinton, and perhaps he won't be impeached for his unforgivable crime of not being a Republican.

Maybe.

Zandar's Thought Of The Day

Winger logic:

Global warming is a hoax because science can't prove everything and you have to allow for other theories and question it.

Evolution is unproven because there are too many variables and it doesn't explain everything about life on Earth and you must question it.

Peak oil theory is a hoax because there's plenty of oil on Earth and it's a renewable resource and you have to question the science.

If a hybrid car gets in a fatal accident, it's undeniable that these cars are unsafe and the science proves it!

(On the other hand, the science proves the mileage on the new Chevy Volt? There's not much doubt there that the car doesn't live anywhere near up to GM's claims.)

Also, everything's Obama's fault.

What The Bush Years Brought

Two depressing reminders of what the Bush years have done to the country.  First, a drop in ranking in per capita wealth:

As if we needed more warnings that the US is rapidly losing its position as the world's superpower and wealth aggregator, is the following chart from Credit Suisse, which ranks the top 10 countries in the world in terms of average wealth per adult. While the US was #1 10 years ago, due to an abysmal growth rate of only 23%, by far the lowest of all the ranked countries, the US has now dropped from first to seventh, falling behind such countries as Sweden and France. At the top - such perennially voted "top places to live" as Switzerland and Norway.

Second, our life expectancy ranking has also dropped.

Just to underscore the rapidity of the decline, as recently as 1999, the U.S. was ranked by the World Health Organization as 24th in life expectancy.  It's now 49th.  There are other similarly potent indicators.  In 2009, the National Center for Health Statistics ranked the U.S. in 30th place in global infant mortality rates.  Out of 20 "rich countries" measured by UNICEF, the U.S. ranks 19th in "child well-being."  Out of 33 nations measured by the OECD, the U.S. ranks 27th for student math literacy and 22nd for student science literacy.  In 2009, the World Economic Forum ranked 133 nations in terms of "soundness" of their banks, and the U.S. was ranked in 108th place, just behind Tanzania and just ahead of Venezuela.

Other countries are smarter, healthier, and better equipped to handle the 21st century.  But we do lead the world in two respects still:  number of people in prison (both total and per 100,000 citizens) and number of guns supplied to the world.

On second thought, maybe a country full of stupid, heavily-armed prisoners makes us uniquely qualified for where the 21st century is heading.

Epic 8-Bit Theater Win

Hollerado's "Americanarama".  Canadian band, from what I understand, and these guys just won at least six or seven internets with this "Human 8-bit Video".

Squee, and EPIC WIN.

The Haunted Manchin

Pop quiz, folks.  Which Senate candidate said the following on FOX on Sunday?

"The president's plan -- 'Obamacare,' as it's been called -- is far too reaching. It's overreaching. It needs to have a lot of it repealed.  If you can't fix that, repeal the whole thing."

Sharron Angle?   Ken Buck?  Rand Paul?  Marco Rubio?  Surely it's one of the Tea Party faithful, yes?

Nope.  If you said West Virginia Democrat Joe Manchin, take a drink.

The harsh take on President Obama's signature legislative achievement this Congress is just the latest effort by Manchin to distance himself from establishment Democrats. Last week, the governor of coal-heavy West Virginia said that Obama was "dead wrong" on climate policy and for supporting cap-and-trade legislation.

Raese's campaign charges Manchin with sending mixed messages on healthcare.

The GOP candidate's campaign flagged an appearance Manchin made over the weekend on Fox News in which Manchin said he "supported health reform," and that he still does -- at least in concept.

Manchin said he supports health reform as a matter of concept, and called on both parties to rally around reforms on which they agree.

Right, because what we really need to do is completely refight the health care reform argument.  Repeal and replace.  Amazing.

Look, I understand Joe Manchin is a popular Democratic governor running for the Senate for Robert Byrd's seat in the heart of coal country and has to pull a Jay Rockefeller on cap and trade, but I'm becoming increasingly convinced that Manchin running to the right of conservative Dems like Ben Nelson is one of the main reasons why he's gone from a shoo-in two months ago to increasingly behind in the polls.  Running dead against Obama on FOX on healthcare to the right of basically every Democrat in the Senate right now simply isn't going to get you elected.

People instead looking for the Republican candidate will elect the Republican, not Manchin.  And I don't see how he can pull this off, either.

Shame, too.   John Raese will be even worse than Manchin and he's got tons of his own problems too.  Just another depressing reminder that not all wingnuts are Republicans.

Turn On The Lights, Watch The Roaches Scatter, Part 16

Unbelievably, there may be a major hitch that that all but inevitable national foreclosure freeze...the Obama administration itself.

The Obama administration does not support a nationwide moratorium on foreclosures at this time, Federal Housing Administration Commissioner David Stevens said Sunday in an e-mail response to questions.

"We believe freezing foreclosures for all banks in all states, whether we have reason to believe them to be in error or not, is simply not the prudent step to take in this fragile housing market," he said.

With approximately one in four homes sold in the second quarter in foreclosure, administration officials worry that a moratorium could have a significant impact on the economic recovery.

"While we understand the eagerness to make sure that no American is foreclosed upon in error, we must be careful not to over-reach and apply a remedy that will make the underlying problem of foreclosures worse," he added. 

I don't think the White House's opposition is going to matter in the least given the massive liability the banks are facing right now, but Wall Street's growing opposition to this will.  Even Yves Smith is pissed off at this one.

So we are back to Wall Street calling the shots, the very same Wall Street that invokes the “give us what we demand or we’ll shoot the economy” demand whenever its pet interests are threatened. Here the securitization industry was colossally irresponsible in its conduct, and has created a mess that will be monstrously difficult to remedy….and we’re supposed to plow onward in business as usual mode?

And notice the false dichotomy: the banks who screwed up yet again (and will need to be recapitalized again, trust me, foreclosure moratorium or not, there is a tsunami of litigation on the horizon that will bury servicers and the major trustees on securitizations) versus “Congressional leaders who are playing politics.” Huh? And it FURTHER, and falsely implies that those evil Congressmen are the reason banks have imposed moratoriums. Erm, it has to do with the fact that filing an improper affidavit is a very serious matter, and the banks have to straighten that out (at a bare minimum, as we stress here repeatedly, the affidavits are merely the presenting problem, not the fundamental failing).

And we further get another lie, that it’s the foreclosure freezes imposed by banks, and the prospect of more at the state level, that might affect REO sales. That’s another Big Lie; the most pressing impediment, and it’s not getting better any time soon, is title insurers withdrawing from foreclosure sales from banks that have admitted to having affidavit problems. Other title insurers are reported to be writing qualified policies on foreclosure sales.

In other words, this is exactly the line the Wall Street banks want the White House to take.  We're right back in the exact situation we were in October 2008:  banks telling the people who make the decisions that if the banks themselves have to fall on their swords for their own malfeasance, the economy is toast, so we have to give them more money now!

The problem is not doing so this time will still wreck the economy, and given the legal liability these banks are facing, what the White House thinks about the foreclosure freeze doesn't matter in the larger scheme of things.

Exciting New Horizons In Obama Derangement Syndrome

Now featuring a fresh look at false equivalency paradigms as the wingers are having trouble deciding what a book tossed at Obama's head and streaker running by the President's rally in Philly yesterday really means, that Americans are on the edge of revolt after being unlawfully occupied by liberals and that there weren't any shoes handy to toss at History's Greatest Monster, or that the liberal media is unforgivably corrupt for not reporting on the Book-Chucking Heard 'Round The World.

The real issue of course is that the argument I've been making about security needing to be airtight around this President in particular may have some merit, yes?

Just saying that if somebody can throw a book at the President's head, there's a lot of other things that might be tossed at the man.

Somebody might want to look into that.   Meanwhile, the false equivalency that this is Obama's "Iraqi shoe tosser" moment makes about as much sense as every bad weather event in America being Obama's Katrina, or every Democrat that fails to win an election as Obama's Waterloo, or every time Obama loses gracefully to his daughter Malia at checkers, it's Obama's Frodo throwing the One Ring into the fires of Mount Doom or whatever this goofballs are thinking this week remains just as annoying idiotic as ever.

The QE2 Sets Sail Soon

You didn't have to go any further than figuring out the Dow crossed 11k again despite our lousy economy to know that irrational exuberance is in the air.

Following Friday’s disappointing jobs report, market participants are now virtually certain that the Federal Reserve will announce that it will resume buying assets at the conclusion of its November meeting and do so in a sizeable way, according to an exclusive CNBC Fed Survey.

Nearly 93 percent of the 70 respondents, including economists, fund managers and traders, believe the Fed will boost the size of its portfolio, up from 69 percent in the survey two weeks ago. 

Of those who expect the Fed to move, 86 percent look for an announcement in November, up from 38 percent in the last survey. Market participants forecast that the Fed will announce plans to purchase $500 billion in assets at the conclusion of the upcoming meeting, the first time the question has been asked. 

Despite the $500 billion average, expectations for the November announcement span a range from $100 billion to as high as $1.5 trillion. But the larger numbers are outliers, with 83 percent of respondents saying they expect the Fed to announce incremental targets for its portfolio size on a monthly or quarterly basis, rather than a single, so-called “shock and awe” strategy as it did in 2009. 

The market's expecting more Fed divine intervention and in a big, big way.  Long-time readers have seen me discuss the inflation-deflation-hyperinflation cycle before, and this may be the event that triggers the beginning of that third stage, especially since we're in a biflation area now where commodities and basic staples like food and gas are rising in price, while durable finished goods like TVs and cars are dropping.

The market is definitely expecting the Fed to become the biggest holder of US treasuries in a couple of weeks.  What that's going to do to the market, I'm not 100% sure.  What I do know is that it's going to be impressive, and not in a good way.

The market is now pricing in a lot of Fed intervention, perhaps trillions of it.  Dropping another money nuke on the dollar like that may cause a hell of a chain reaction.

The Kroog Versus The Paradox Of Myth

The myth of Obama's "massive increase in federal government", that is.  The reality is much more sobering as Paul Krugman points out (emphasis mine):

Consider, in particular, one fact that might surprise you: The total number of government workers in America has been falling, not rising, under Mr. Obama. A small increase in federal employment was swamped by sharp declines at the state and local level — most notably, by layoffs of schoolteachers. Total government payrolls have fallen by more than 350,000 since January 2009.

Now, direct employment isn’t a perfect measure of the government’s size, since the government also employs workers indirectly when it buys goods and services from the private sector. And government purchases of goods and services have gone up. But adjusted for inflation, they rose only 3 percent over the last two years — a pace slower than that of the previous two years, and slower than the economy’s normal rate of growth.


So as I said, the big government expansion everyone talks about never happened. This fact, however, raises two questions. First, we know that Congress enacted a stimulus bill in early 2009; why didn’t that translate into a big rise in government spending? Second, if the expansion never happened, why does everyone think it did?

Part of the answer to the first question is that the stimulus wasn’t actually all that big compared with the size of the economy. Furthermore, it wasn’t mainly focused on increasing government spending. Of the roughly $600 billion cost of the Recovery Act in 2009 and 2010, more than 40 percent came from tax cuts, while another large chunk consisted of aid to state and local governments. Only the remainder involved direct federal spending.

And federal aid to state and local governments wasn’t enough to make up for plunging tax receipts in the face of the economic slump. So states and cities, which can’t run large deficits, were forced into drastic spending cuts, more than offsetting the modest increase at the federal level. 

And that's why the stimulus didn't work as nearly as well as it should have.  As a matter of fact, all it did was prolong the prevention of massive job losses at the local and state government level, losses we're now beginning to see.  September's increase of 64,000 private sector jobs was more than offset by the loss of over 100,000 local and state government employees last month.  That's been going on for quite some time now.  Yes, this year the country has created hundreds of thousands of private sector jobs, but they have been countered by the loss of teachers, police, firefighters, clerks, administrators, engineers, drivers, public defenders, you name it.   That's why we've been treading water for the last 8 months on the unemployment rate.

Obama has presided over the largest number of government job cuts in decades, folks.  And the pain is just beginning.

Slime And Punishment

There's been a lot of deserved frustration with the Obama administration and Democrats in general by LGBT activists, as 21 months after the President took office, the military's Don't Ask, Don't Tell policy and the federal Defense of Marriage Act still exist, thanks in no small part to what some believe is Obama's reticence to take executive action on equality.  There are definitely those who wish to punish the President and the Democrats in a few weeks as a result of less than speedy action on the issue, particularly in reversing Bush's executive orders.

To those who wish to do so, allow me to interject some perspective this morning on what the alternative to the Democrats will be.

The Republican candidate for governor, Carl P. Paladino, told a gathering in Williamsburg, Brooklyn, on Sunday that children should not be “brainwashed” into thinking that homosexuality was acceptable, and criticized his opponent, Attorney General Andrew M. Cuomo, for marching in a gay pride parade earlier this year.

Addressing Orthodox Jewish leaders, Mr. Paladino described his opposition to same-sex marriage.

“I just think my children and your children would be much better off and much more successful getting married and raising a family, and I don’t want them brainwashed into thinking that homosexuality is an equally valid and successful option — it isn’t,” he said, reading from a prepared address, according to a video of the event.

And then, to applause at Congregation Shaarei Chaim, he said: “I didn’t march in the gay parade this year — the gay pride parade this year. My opponent did, and that’s not the example we should be showing our children.” Newsday.com reported that Mr. Paladino’s prepared text had included the sentence: “There is nothing to be proud of in being a dysfunctional homosexual.” But Mr. Paladino omitted the sentence in his speech. 

As slow as the Democrats may be proceeding forward on equality and civil rights, they are proceeding forwards.   The Republicans will most certainly not.  Something to keep in mind for those who wish to withhold their votes this year to punish the Democrats over their lack of winning the battle yet.

StupidiNews, Columbus Day Edition!

• The wife of Nobel Peace prize-winning Chinese dissident Liu Xiaobo remains under house arrest as he remains in prison.
• Polls in California show Prop 19, legalizing pot, faces a close battle.
• As US forces leave Baghdad, Iraqi security forces are struggling to keep the peace in an increasingly difficult situation.
• The G-20 is increasingly turning to the IMF to settle a massive international currency dispute resulting from weakness in the US dollar.
• Ubuntu version 10.10, codenamed Maverick Meerkat, is the latest revision to the increasingly popular Linux operating system.