Lessons from the 2010 Election

So there seem to be, in absence of detailed exit poll data, certain things that we CAN take away from this debacle.

First, to misquote Gordon Gekko, obstructionism WORKS. Obstructionism is GOOD. The American people voted in the Dems in 2006 and in 2008 to enact real, positive change. The Republicans made damned sure that wouldn't happen by posing a united front in the Senate. The Dems tried, over and over again, to try to pin the Senate's failure to enact cloture on the Republicans. It never stuck. It was never GOING to stick; the press was too busy focusing on horse races, and the public doesn't give a damn. They'll blame whomever is in power.

That also goes for the Republicans' negotiation tactics. Playing at being convincible when talking with the President and Congressional leadership, extracting concession after concession with no concession in turn, and then walking away at the end worked SPECTACULARLY well for the Republicans. It might not have if they ended up getting blamed for the resulting legislation, but they never, ever did. Part of that was due to Obama's own overly-concession-prone negotiation style, and the Dems' inability to create and stick to a message. But I think a lot of it is just the simple fact of politics, and something the Dems should remember going forward when they work to frustrate the Republican house.

Second, Citizens United paid off BIG for the Republicans. I don't think there's any doubt about that. Dems were yelling that they were getting HAMMERED with corporatist advertising in State after State. Obama tried to tie the ads to big money; but, again, the public was simply not in the mood for justifications or excuses. It's only going to get worse; I think that 2012 may be the first election that is basically bought-and-paid-for if things go badly.

Third, I also think that the teabaggers paid off for the Republicans, too. Sure, they lost Nevada, but Rand Paul managed to pull it off, along with others. More importantly, they did what they needed to do to relabel their party. The teabaggers are really just the same old, white, upper-middle-class conservative males that have ALWAYS been the backbone of both the conservative movement and the Republican party. What's changed is that now they have an identity to look at, and that the media can freak out over. That's something the progressives don't have, and have never really had. Partially it's because of their tendency to splinter, but I think it also has to do with our fourth reason.

Fourth, the Dems completely destroyed their electoral machine. OFA is a sad shadow of what it used to be. It was never going to be as big as it was in 2008, of course. But as one of the people on CNN pointed out, Reagan made sure that he kept his young Republican groups engaged throughout the term, instead of just trying to rally them when election time rolled around. The rest of the progressive groups were if anything WORSE off, thanks to the combative, hostile relationship the Obama administration had with its own base. The enthusiasm gap was dramatic throughout the race, and I expect that in the days ahead we'll find out just how dramatic it was. But I think it didn't need to be, and that it's Obama's own fault that it

And finally, the combination of the hatred of BOTH parties and the results, along with the economic situation, shows that the American people still want change and not necessarily what the Republicans are peddling. This may be the Republicans' undoing, since their policy prescriptions will NOT make thing batter. The best they can hope for is a slight spike from businesses and investors who assume that their party will be pro-business, but I suspect that the fundamental problems will likely reassert themselves soon enough. The Republicans' plans are economically suspect at best, and likely catastrophic; they would be best buried by the Democratic president and Senate. But since I doubt the Dems will have that kind of sense, it's likely that they'll try to "work with the Republicans" in enacting part of the Republican agenda. Then, when things get WORSE, the finger-pointing will begin.

This isn't what I would have wanted. THIS SHOULD NOT HAVE HAPPENED. The Dems and the President should have known that this would be the ultimate end of their frustrated, inadequate, poorly-focused efforts over the past two years. THIS is what happens when you listen to people like Rahm Emanuel. THIS is why they need real victories to show the American people. THIS is why catering to the blue dogs to the exclusion of all else doesn't work. (They got hammered tonight.) THIS is why you don't abandon the networks you built up. And THIS is why you need to develop a strong identity and pay close attention to your Supreme Court nominees.

But I suspect that they'll get the wrong message. They'll think that they've "moved too far left" or some such nonsense. It's not about left and right. It never was. It's about people wanting some security and prosperity in their lives. And when the Republicans fail at providing it, things are going to get a whole lot uglier.

Election Day!

No, I don't expect it to go well. No, I don't think the Dems have proven their case. (I don't think the Republicans have, either, but they aren't in power right now.)

And I'm with Krugman; I suspect that the next few years will bring little good. The chance was Obama and the Dems' to waste: and sure enough they wasted it. They did SOME good, of course. Health Care may well be better than nothing, as is FinReg. But only barely, and considering the outsized majorities they had, well...

In any case, the frustrating part will be if the Republicans DO win back the Senate. Because when they pass bill after bill, counting on the Dems to let them get cloture, I can guarantee all of you that neither the Dems nor the media will make a peep about the fact that the Republicans convinced all of them that a Democratic Senate needed a sixty-seat majority to pass legislation, while a Republican Senate does not.

In any case, go vote. It may or may not help. But there ARE good Dems out there; your Feingolds and Graysons and whatnot. They DO deserve your support. Even the Blue Dogs might, barely, if the alternative is one of those "Tea Partiers" snug in the pockets of the Koch brothers.

But while you vote, stop and think about how the Republicans were given up for dead two years ago. Think about what changed. And think about why.

Rent is Too Damn High Party (Update: Now With More Hasidim!)

Edit: fixed malformed link.

Now THIS is how you do "single-issue candidate". Jimmy McMillan of the "Rent is Too Damn High Party" absolutely stole the show at the New York State Gubernatorial debate last night.

Gawker called him "crazy"; HELL no, he isn't crazy. He's cogent, on-message, has a striking appearance that helps get him attention (which you need as an issue candidate) and the sort of emphatic, impassioned delivery that'd make a preacher cry.

I'm sure a ton of people would (will?) happily vote for him; Cuomo would be insane not to leverage this.

Edit: Ah, or perhaps Cuomo should leave well enough alone. McMillan is trending high right now, but already people are noticing that he found a target for his ire back in 2005. That would be, *ahem*, "the Jews". Utter ethical dubiousness aside, I don't think it's a terribly wise position for a gubernatorial candidate in New York, of all places.

It is a rather weird case. His specific complaint was, from what I can gather, that Hasidim (ultra-Orthodox) Jews living in the Williamsburg area of Brooklyn were systematically refusing to rent to outsiders. Considering that's a common complaint about the so-called "black hats" in Israel, it's plausible that he might not understand the distinction. But, then again, he also blamed "the Jews" for the 2001 WTC attack. That is, uh, a wee bit less plausible.

On the other hand, he claims that he's renounced that stuff:

There have been comments that I have attempted to label me anti-semitic or anti-Jewish. This has been nothing more than "kill the messenger" and "character assignation" politics as usual which was spread by opponents that have nothing better to say. It may sound trite in this matter but even in this campaign I rely on Jewish close friends and advisors.

However, if I have ever made any biased remarks toward anyone or any group I heartfeltly apologize. Further, I apologize to the Jewish community for having to suffer the boorish bias of anyone. Even the reminder that there is still bias in America bias is painful; as a Black-American Man I empathize fully with the Jewish-American community.

Hey, they forgave Bob Byrd.

Wall Street's Pathologies

While I'm KrugPostin', here's a KrugLink to a piece in the NY Observer about, well, just what kind of asshats are working on Wall Street these days.

"The first thing that needs to happen, I think, is to get these people out of their homes," a man wearing a bespoke blue-striped shirt, a Hermés tie patterned with elephants and Ferragamo loafers said recently. "Correct! I'll explain," the veteran member of a bank restructuring and advisory team said.

Amid evidence of sham documents and widespread paperwork gaffes, if not systemic fraud that increasingly looks like it may be terrifically deep, Bank of America recently halted all foreclosure proceedings around the country. That followed similar announcements from the home-loan giants JPMorgan Chase and GMAC.

But Wall Street does not sympathize. "You had people putting zero down to get massive houses they couldn't afford to be in," he said Monday morning, "but now they want to stay. And the government wants to let them stay, because they're voters." A few hours later, the Goldman Sachs arm Litton Loan Servicing said it had suspended certain foreclosure proceedings, too. "Talk about a financial scandal," a Wall Street Journal editorial this weekend joked. "A consumer borrows money to buy a house, doesn't make the mortgage payments and then loses the house in foreclosure—only to learn that the wrong guy at the bank signed the foreclosure paperwork. Can you imagine?"

"The problem is they don't deserve to be in that place. They probably deserve to be there less than they used to," the source continued, referring to incomes lower now than they'd been when the loans were made in the first place. "You do need to foreclose, and you need to go back to people living in houses that are consistent with their income levels."

At this point, I'd like to remind readers that there are reports all over the place about people getting foreclosed upon that paid in full and paid in cash. Including in the Observer. Moving on...

In order to understand Wall Street's shrug during this foreclosure crisis, which as many as 40 attorneys general are expected to announce an investigation into this week, the key is to appreciate just how deeply connected the gesture is to Wall Street's view of who's to blame for the financial crisis.

The feeling, the idea at the bottom of all the others, is that even if Wall Street aggravated the crisis by bundling and betting on mortgage-backed securities that turned out not to live up to high ratings, it was not a matter of, as Citi chairman Richard D. Parsons told The Observer this summer, "bad people trying to do bad things." The loans wouldn't have been there in the first place if American home buyers, driven by what The Weekly Standard calls immediate gratification without personal responsibility, hadn't overstepped their bounds.

So when Ken Bentsen, the executive vice president for public policy and advocacy at Wall Street's largest trade group, the Securities Industry and Financial Markets Association, talks about this foreclosure fraud crisis, he points out that the homeowners arguing about administrative problems are the ones who've gotten themselves tied up in the foreclosure route in the first place, regrettably. "No one has raised the question that anyone who's going through this process shouldn't have been in the foreclosure process," said Mr. Bentsen, who, as a congressman from Texas, helped write the Sarbanes-Oxley and Gramm-Leach-Bliley acts.

"Look, I think it's just human nature. People want to have a bogeyman," Ralph Cioffi, the former Bear Stearns hedge fund manager, who was found not guilty of fraud, said in a recent Observer profile about anger at banks and bankers. "People don't want to take responsibility for their own actions."

Apparently not.

So, the Wall Street titans, having screwed up so badly that they needed to be rescued from their own financial crapulence by the American people, are right back to blaming absolutely everything on poor people. Let the borrowers suffer. I have a tee time to get to!

Never mind that the wealthy are more likely to play the "jingle-mail" card than the poor are. Never mind that the professionals involved all signed off on this nonsense. And never mind that everybody said that the crash couldn't happen, that home prices couldn't go down, and that anybody who said otherwise was a crank. And never mind that the institutions that these guys work for were more precariously leveraged than a thousand insolvent homeowners. No, it all comes back to the OTHER guy.

And why?

"Because people don't want to take responsibility for their own actions".

No, Government Hasn't Gone Up

Yeah, Krugman's been banging on this one for a while, but he linked to a great post by Menzie Chinn that shows the situation.

I've been lecturing on the government sector in my macro course. In updating my lecture notes, I plotted out some interesting graphs, which link up nicely with this previous post. The following four figures highlight: (1) normalized Federal outlays are not much higher than in 1986; (2) government consumption to GDP is back up to 1991 levels; (3) the cyclically adjusted budget deficit is only 2 ppts larger than that recorded in 1987; and (4) Federal consumption remains far below the previous peak in 2007.

One of the topics stressed in the textbook and lecture notes is the endogeneity of the budget balance, and especially the transfer and tax components. This leads to the first graph, of transfers normalized by nominal GDP, and transfers normalized by potential GDP...

...Notice that government transfers as a share of GDP looks particularly high because of the collapse of GDP in the Great Recession which started in 2007Q4. Normalizing by potential GDP highlights the fact that, while the ratio is the highest over the last forty three years, it is only slightly higher than that recorded in the mid-1980s, during the Reagan administration.

Normalizing government consumption and investment illustrates that overall spending by the government in purchases of goods and services is not particularly high. Even dividing by nominal GDP indicates that we are only (almost) back to the levels of 1990. Normalizing by potential GDP indicates that we are still only back to the levels of the early 1990's (this spending includes defense)...

...So, it is true that the Federal government's role in terms of spending and transfers has increased against the backdrop of a massive decline in output starting in 2008Q4 -- but some of the movements in various indicators are distorted by the large negative output gap that has opened up.

That latter bit is why I liked the post so much. Focusing on spending as a percentage of GDP is really prone to distortion. That measurement of spending as a percentage of potential GDP neatly removes that problem. It reinforces what I've known for a while: that you don't need to cut social spending. Just end the damned wars, end the Bush tax cuts, and end the recession. Do those things, and the budget falls neatly into place.

Obama Hit by Foreclosure Scammers?

Holy Hell. From ZeroHedge:

Just like we have been saying all along, this is so much bigger than  "affidavits."

Here is another piece of the puzzle, without bringing up the REMIC issues...

Now that YOU are effected personally in this, Mr. President, what are you going to do about it?

Let's get off the whole CNN Axelrod signals White House opposition to foreclosure moratorium BS...

"The Obama administration opposes a moratorium on home foreclosures, but wants problems involving improper paperwork resolved as quickly as possible, senior adviser David Axelrod said Sunday."I'm not sure about a national moratorium,"

Like my dear friend at the Hamlet puts it

It’s not the foreclosure affidavits only. Hello? It’s the whole kit-n-caboodle. it’s the fabricated assignments of mortgage, fake allonges, robo-stamped endorsements in blank, and satisfactions of mortgage, ignoring SEC and IRS regulations, disregard for the steps required by the REMIC rules. It’s all the top national banks and their servicing arms. The whole of it is a sham. Don’t believe the propaganda that insists otherwise.

Got it?

Now for the fireworks...

I won't quote the whole thing, but the post (appears to be Michael Redman from 4closurefraud.com) gets into how it's quite likely that multiple people were posing as Marshe Craine, the same "vice-president" from Chase Manhattan, in the same sort of documents that Obama put up. "Marshe" had one signature in one form, and an entirely different signature in Obama's forms. And wasn't with Chase to begin with, but another (sketchier) outfit called Mortgage Electronic Registration Systems, or MERS.

Whoops.

Of course, the whole thing relies on photos that I haven't reproduced here, so you should check it out yourselves. And it's not exactly unlikely that this would happen, because it has apparently happened to half of the damned country!

But it does put things in perspective:

So you see, this whole Foreclosure-Gate crisis has nothing to do with the "deadbeat" borrowers, it never has.

It has to do with the complete lack of the respect of the law by the banking industry.

They got away with it up until now and are trying their damnedest to paper over their crimes.

It is time to say no more...

They tricked all of us, even you Mr. President, and completely disregarded the basic laws of this country to make a buck.

I have been beating this drum, along with a few others, for years now and it is time to come to an end.

Mr President, now that you have had the fraud perpetrated on you personally, what are you going to do about it?

The system is broken and the foreclosures need to be stopped NOW.

It is actually worse than you can imagine...

What's that old line? Look at any great fortune, and you'll find a great crime?

Well, we knew what the fortune was. And now we're discovering the crime.

Israel Requires Loyalty Oath to "Jewish, Democratic State"

The Israeli Cabinet has apparently approved a bill requiring non-Jewish immigrants to swear loyalty to the "Jewish, democratic state". Yep, Yisrael Beitenu managed to push it through. Not exactly going to endear them further in the Muslim world, especially when the initial effects involve, you guess it, West Bank Palestinians.

Were the bill to be passed by the Knesset, the people immediately affected would be Palestinians in the West Bank and Gaza who either want to marry a Palestinian-Israeli citizen or have already married and are waiting on their papers to be processed, she said.

Earlier, Ahmad Tibi, an Arab member of the Knesset, told Al Jazeera that the bill was aimed at Palestinians - and not at Jewish newcomers to Israel since they already enter on Israel's Jewish Law of Return.

"Palestinians will have to say that this country is for Jews, and Palestinians are only guests. If you are saying you are democratic, you should treat citizens with equality," Tibi said.

He said that Israel was trying to impose this on the Palestinian Authority (PA) as a pre-condition for peace talks.

Direct peace talks between Israel and the PA, under the leadership of Mahmoud Abbas, are currently at an impasse due to Israel's refusal to extend the 10-month freeze.

Recognition of Israel as a Jewish state is one of Netanyahu's principal demands in any eventual peace deal with the Palestinians...

...Palestinians have repeatedly rejected Netanyahu's condition as it would amount to an effective renunciation of the right of return for Palestinian refugees.

"The new citizenship law will make it impossible for Palestinian refugees and their descendants to return to their homeland," Marwan Bishara, Al Jazeera's senior political analyst, said.

Theoretically, this doesn't change that much. Israel IS a Jewish Democratic state. What bothers me is that little comma there, since it implies that people have to swear to loyalty to Israel as a Jewish state in particular. Israeli Arabs are already feeling more than a little put-upon; this is only going to cement it.

And, as the AJ analyst said, this preempts one of the most important elements of any peace negotiation between Israel and the Palestinians: the question of Palestinian refugees. Requiring them to swear loyalty to the Jewish character of the state of Israel is not going to happen, not after they were pushed out in the first place. It's clearly a move to create "facts on the ground"; and the Palestinians are not going to look kindly on Israel pulling that tactic again.

Not that the negotiations are going anywhere. I'm not convinced that Netanyahu gives a damn about them in the first place. But if there's some future prime minister that is interested in peace and reconciliation, he or she is really going to have their hands tied.

Jailed Chinese Dissident Wins Nobel Peace Prize

Yep, you heard me right. Liu Xiaobo, an imprisoned Chinese democratic activist, has just won the world's most prestigious award. Huffpo:

Imprisoned Chinese democracy campaigner Liu Xiaobo on Friday won the Nobel Peace Prize – an award that drew furious condemnation from the authoritarian government and calls from world leaders including President Barack Obama for Liu's quick release.

Chinese state media blacked out the news and Chinese government censors blocked Nobel Prize reports, which highlighted Liu's calls for peaceful political change, from Internet websites. China declared the decision would harm its relations with Norway and promptly summoned Oslo's ambassador to Beijing to make a formal protest.

In Oslo, China's ambassador to Norway met with a state secretary at Norway's Foreign Ministry, ministry spokeswoman Ragnhild Imerslund said.

The Norwegian officials explained that the peace prize committee is independent of the government and that Norway wants to maintain good relations with China, Imerslund said.

This year's peace prize followed a long tradition of honoring dissidents around the world and was the first Nobel for China's dissident community since it resurfaced after the Communists launched economic but not political reforms three decades ago...

...The Nobel committee praised Liu's pacifist approach, ignoring threats by Chinese diplomats even before the announcement that such a decision would result in strained ties with Norway. Liu has been an ardent advocate of peaceful, gradual political change.

The Nobel committee cited Liu's participation in the Tiananmen Square protests in Beijing in 1989 and the Charter 08 document he recently co-authored, which called for greater freedom in China and an end to the Communist Party's political dominance.

Obama said in a statement that Liu "has sacrificed his freedom for his beliefs" and is "an eloquent and courageous spokesman for the advance of universal values through peaceful and nonviolent means."

"We call on the Chinese government to release Mr. Liu as soon as possible," Obama said.

No surprise that Obama said he should be released. They ARE Prizebuddies.

But this is a serious black eye for China. Just as they're starting to get a wee bit belligerent in the region, squabbling with Japan over the Senkaku/Diaoyu Island chain and with Vietnam over the Spratlys, here comes the Nobel Prize committee saying "hey, folks, remember how China is kind of an oppressive regime? You may have forgotten, but look at this guy! He's amazing, an utter pacifist, and they tossed him in a hole!"

It's going to embolden their external and internal critics, and it's going to be damned near impossible for their Great Firewall to block discussion of all this.

On the other hand, at least now the Chinese and the neo-conservatives have something they can finally commiserate about: how much they loathe the Peace Prize.

"Thin Strips of Objectivist Jerky"

John Scalzi absolutely knocks it out of the park on the whinging by the wealthy about their supposedly (read: not at all) high taxes. He notes that many don't even seem to understand how marginal taxation works, but then goes on to talk about another group...

There is another answer as well, which can be paired with the above or stand on its own, and it’s that there’s a certain sort of person who believes that all taxation (or all taxation outside of one or two very specific things of which they approve) is theft. Naturally that sort of person will fly to the defense of any who bleat about their taxes being too high, even if in point of fact, the wealthy in the US are currently being taxed at historically low rates (“but they’re still too high!”).

I really don’t know what you do about the “taxes are theft” crowd, except possibly enter a gambling pool regarding just how long after their no-tax utopia comes true that their generally white, generally entitled, generally soft and pudgy asses are turned into thin strips of Objectivist Jerky by the sort of pitiless sociopath who is actually prepped and ready to live in the world that logically follows these people’s fondest desires. Sorry, guys. I know you all thought you were going to be one of those paying a nickel for your cigarettes in Galt Gulch. That’ll be a fine last thought for you as the starving remnants of the society of takers closes in with their flensing tools.

Sure, we've all heard it before. "If you want to live in Libertopia, move to Somalia" and suchlike. Damned if Scalzi doesn't make it vivid, though.

I don't want to live in libertopia—and rest assured, neither do you.

Taibbi on the Tea Party: "They're Full of S**t. All of Them."

Here, have a Taibbi:

After Palin wraps up, I race to the parking lot in search of departing Medicare-motor-scooter conservatives. I come upon an elderly couple, Janice and David Wheelock, who are fairly itching to share their views.

"I'm anti-spending and anti-government," crows David, as scooter-bound Janice looks on. "The welfare state is out of control."

"OK," I say. "And what do you do for a living?"

"Me?" he says proudly. "Oh, I'm a property appraiser. Have been my whole life."

I frown. "Are either of you on Medicare?"

Silence: Then Janice, a nice enough woman, it seems, slowly raises her hand, offering a faint smile, as if to say, You got me!

"Let me get this straight," I say to David. "You've been picking up a check from the government for decades, as a tax assessor, and your wife is on Medicare. How can you complain about the welfare state?"

"Well," he says, "there's a lot of people on welfare who don't deserve it. Too many people are living off the government."

"But," I protest, "you live off the government. And have been your whole life!"

"Yeah," he says, "but I don't make very much." Vast forests have already been sacrificed to the public debate about the Tea Party: what it is, what it means, where it's going. But after lengthy study of the phenomenon, I've concluded that the whole miserable narrative boils down to one stark fact: They're full of shit. All of them. At the voter level, the Tea Party is a movement that purports to be furious about government spending — only the reality is that the vast majority of its members are former Bush supporters who yawned through two terms of record deficits and spent the past two electoral cycles frothing not about spending but about John Kerry's medals and Barack Obama's Sixties associations. The average Tea Partier is sincerely against government spending — with the exception of the money spent on them. In fact, their lack of embarrassment when it comes to collecting government largesse is key to understanding what this movement is all about — and nowhere do we see that dynamic as clearly as here in Kentucky, where Rand Paul is barreling toward the Senate with the aid of conservative icons like Palin.

This is just the beginning. There is LOTS more. But that's the crux of it. It's hard to make sense of the Tea Party because it doesn't make sense. It's not logical. It is, as Taibbi discovered, "deep down and psychological". It's a reaction to the subconscious knowledge that they're being exploited by someone, but they've been deceived as to who. They blame "radical leftists", and don't even consider that they might be being exploited by people who putatively share the same ideology they do. People who essentially bought and paid for their "grassroots movement", which is as neat a bit of AstroTurfing by the Koch Corporation (and other corps) as you could ask for.

So they're being used. They're being exploited. But it's hard to care when they're calling you a communist:

It would be inaccurate to say the Tea Partiers are racists. What they are, in truth, are narcissists. They're completely blind to how offensive the very nature of their rhetoric is to the rest of the country. I'm an ordinary middle-aged guy who pays taxes and lives in the suburbs with his wife and dog — and I'm a radical communist? I don't love my country? I'm a redcoat? Fuck you! These are the kinds of thoughts that go through your head as you listen to Tea Partiers expound at awesome length upon their cultural victimhood, surrounded as they are by America-haters like you and me or, in the case of foreign-born president Barack Obama, people who are literally not Americans in the way they are.

It's not like the Tea Partiers hate black people. It's just that they're shockingly willing to believe the appalling horseshit fantasy about how white people in the age of Obama are some kind of oppressed minority. That may not be racism, but it is incredibly, earth-shatteringly stupid. I hear this theme over and over — as I do on a recent trip to northern Kentucky, where I decide to stick on a Rand Paul button and sit in on a Tea Party event at a local amusement park. Before long, a group of about a half-dozen Tea Partiers begin speculating about how Obamacare will force emergency-room doctors to consult "death panels" that will evaluate your worth as a human being before deciding to treat you.

"They're going to look at your age, your vocation in life, your health, your income. . . ." says a guy active in the Northern Kentucky Tea Party.

"Your race?" I ask.

"Probably," he says.

"White males need not apply," says another Tea Partier.

"Like everything else, the best thing you can do is be an illegal alien," says a third. "Then they won't ask you any questions."

An amazing number of Tea Partiers actually believe this stuff.

Full of shit, narcissistic as hell, utterly delusional, probably racist (though they'd never admit it)...and if you disagree you're a commie bastard who hates America.

This is the group dominating American politics, folks. This is who Obama's going to be conceding things to next year, since conceding to wingnuts is all that he's turned out to be good at. This is the group that's going to be driving policy. People who think that white males are going to be executed by the Death Panels.

America in 2010: It's like something out of a bad SF novel.

The Blogger Editor is TERRIBLE Now

No, really, it is. I'm getting really, really tired of the insertion of random empty spaces before and after every quoted paragraph. Even if I edit this in HTML, they still creep in. The old editor didn't do this; I'm honestly wishing there was a way to go back to it.

I can see why so many people have left for WordPress or TypePad or the like.

Kocherlakota v. DeLong('s commentators)

Well, okay, not just DeLong. Also Atrios and, well, J. Bradford DeLong's commentator.

The president of the Minneapolis fed—you may remember him as the "interest rates cause inflation" guy—is now saying that the lack of employment demand is structural:

This estimate is based on a rather aggregative view of the labor market. It is important to dig deeper to get a better understanding of the problem, and there is a considerable amount of research under way exploring the quantitative importance of the various forms of mismatch. For example, the International Monetary Fund has recently released a special study based on a new state-by-state measure of the gap between demand and supply for workers with different levels of educational attainment. The study examines the impact of this variable and the foreclosure rate on state-level unemployment. It estimates that 1.5 percentage points of the national unemployment rate is due to these two sources and their interaction. Thus, according to this study, these two types of mismatch alone can account for a significant fraction of my estimate of 2.5 percentage points.

Good economic policy is about using the right tool for the problem at hand. The mismatch problems in the labor market do not strike me as readily amenable to the kinds of monetary policy tools currently available to the Fed.

A DeLong commentator named "Neal" provided the perfect response. What's the top four fields with job openings?

Top 50 job openings 2008-2018
1 Cashiers, except gaming
2 Retail salespersons
3 Waiters and waitresses
4 Customer service representatives

An "education gap"? For cashiers? Uh, no. Over-education, perhaps. Employers may be a bit unwilling to hire highly educated people for jobs that don't even require high school, since they'll (correctly) assume that they're gone the nanosecond they get a better opportunity. But Kocherlakota isn't saying that. He's saying that there are people who are under-qualified for the available positions, and that just ain't the case if you aren't talking about health care.  That's ludicrous.
Another brings up this salient point:

Mismatch is a cruel hoax. To quote Larry Summers before the bubble burst: "Nor can education be a complete answer at a time when skilled computer programmers in India are paid less than $2,000 a month."

Education doesn't help if cost of living differences overwhelm it.

And then there's Robert Waldmann, who decries Kocherlakota's confusion about structural unemployment:

The quoted passage from MinnFed is nonsense, because it is based on double counting. MinnFed first claimed that structural unemployment caused 2.5% of the difference between current unemployment and normal unemployment. MinnFed gave no theory of normal unemployment (up there it is assumed to be exactly zero and subtracting 5 % from the data is normal practice).

Everyone who has ever addressed the question, identifies the natural rate of unemployment with structural unemployment, so the number to hit is 7.5% not 2.5%. Note the quote "It estimates that 1.5 percentage points of the national unemployment rate is due to these two sources and their interaction." that is "It estimates that 1.5 percentage points of the 9.6% is due to these two sources and their interaction." 1.5/9.6 1 so if you count something twice you overestimate.

DeLong makes it clear that he thinks the guy should be canned. He may be right. This bizarre comment and the interest rate thing just show that he's completely out of touch. If not completely out to lunch. Saying that there's a skill gap when it's Cashiers that people want is just ridiculous, and Waldmann has now called his basic economic acumen into question. I don't know what they're doing over at the Minneapolis Fed—wanking over DSGE models, I'm led to believe—but it clearly isn't anything useful.

Germany and the Eurozone

Good piece by Martin Wolf in the Financial Times (article's behind a paywall, but a google search for "Germans are wrong" and Martin's name might see you through) talking about Germany. They aren't too fond of the Euro right now, since they feel like it's forcing them to prop up their European counterparts.

Wolf said that Germany benefits from the Eurozone. It's got loads of captive markets who use the same currency as it does, for example, and it needs them since most of its exports head to European destinations. But take a look at this:

More important, imagine what would have happened, in the absence of the euro. The exchange rate of the D-Mark would have exploded upwards, as currency crises savaged the European economy, as happened in the 1990s. In peripheral Europe, currency depreciations would have been at least as big as, if not bigger than, sterling’s. The absence of such shocks has greatly enhanced the prospects for the German recovery. The creation of the eurozone was, for this reason alone, much more than a favour Germany did for its partners. It was also a big economic (not to mention political) gain for Germany. German industrialists are clear on this, as is the government.

Wolf said that some economists disagree, thinking that investment flowed out of Germany and into the European "periphery". Fine. But what's going on right now isn't a problem of investment, now, is it? The issue is lack of demand, and how much more depressed would the demand for German goods be if their currency was through the stratosphere? Sure, that very lack of demand would probably bring down the value of said currency, but compared to the other countries in Europe it would still be uncompetitive. People would be buying German bonds, but not German goods, and I doubt the average German would be too keen on that.

Meanwhile, everybody else in Europe would arguably be better off than Germany would. Yes, their currency would have depreciated, and their foreign debt loads been much more onerous. But because their currency would have depreciated, their goods would have been amazingly cheap, so much so that demand would have already picked up and stabilized things a bit. That's what floating currencies are FOR, and it's still amazing how many people tend to forget that. That sort of automatic stabilization is what the Euro countries gave up when they joined Germany in their little currency experiment. They counted on the Germans to understand that, and to put the interests of Europe over the interests of their own little corner of it.

Perhaps that was naive. Perhaps Wolf is right, and the Germans aren't as committed to Europe's future as previously thought. Perhaps the Euro is in serious trouble. But we shouldn't pretend that it's Germany that would benefit from its dissolution.

Blame the Progressives

Well, this was inevitable. As highlighted over on Kos by Joan McCarter, Time's Michael Scherer is pre-blaming the results of the 2010 election on progressives.

Yes, despite the fact that progressives were not listened to—when not openly mocked—and the fact that the White House basically bent over backwards to appease the Republicans, Scherer is blaming them.

even as Obama aides were aware of a growing disconnect, it didn't seem to worry their boss. Instead, the ambitious legislative goals usually trumped other priorities. Both in the original stimulus package and then in the health care and energy measures, the White House ceded most of its clout to the liberal lions who controlled the Democratic majorities in the House and Senate. That maneuver helped assure passage of reforms, but it also confirmed some of the worst fears about how Washington works. "I'd rather be a one-term President and do big things than a two-term President and just do small things," he told his team after Republican Scott Brown was elected Senator in liberal Massachusetts and some in the Administration suggested pulling back on health reform.

Not that anybody couldn't have seen that happen. It's the village. They love punching hippies.

Here's Joan:

It's obviously not just the way the right wants to tell the story--it's how the Village wants to tell the story. The evil liberals got their way and forced Obama to overreach on all these policies--never mind that there is no public option, that the energy bill is a shell of what it should have been to either address energy independence or climate change, and the stimulus was about half a billion less than most liberal economists (and WH advisor Christina Romer) thought was necessary and less than what the more liberal House wanted.

One has the feeling that Michael Scherer wouldn't recognize a liberal lion if it bit him on the ass. Say what you will about the stimulus, health care reform, the as-of-yet unpassed energy reform bill, you can't say that they ended up looking like the proposals progressives put forward.

Scherer doesn't CARE if they're actually liberal lions or not. That's not the game. The game is to reinforce the prevailing narrative and, by doing so, cement your status as a "serious journalist". Fame (and well-advertised book releases) will follow.

No, if he cared, he would have had to have addressed progressives' sense of resignation and betrayal, and realized that "overreach" wouldn't properly explain that. He'd need to look to reasons why Obama disappointed everybody, which is quite a bit tricker than simply wanking on and on about those filthy hippies in the Democratic Senatorial caucus.

(The truly bizarre thing is that the guy acknowledged that the stimulus was too small on his blog. Yet not a word of this appeared in the piece.)

The real story here was, is, and will remain the fact that the Republicans understand just how well obstinacy works. That they can block whatever they please, and it's the Dems that will catch hell for it. That the media is lazy, and will listen to whoever has the loudest voice and repeats the most instead of doing actual reportage. And that the deep pockets of secretive ideological zealots can make all the difference.

But that won't make you friends in Washington. It's just the truth. And who gives a rat's ass about that?

Oil Well Explosion in Gulf of Mexico

You have GOT to be shitting me.

An offshore oil rig has exploded in the Gulf of Mexico, west of the site of the April blast that caused the massive oil spill.
Coast Guard Petty Officer Casey Ranel says the blast was reported by a commercial helicopter company about 9:30 a.m. CDT Thursday. Seven helicopters, two airplanes and four boats are en route to the site, about 80 miles south of Vermilion Bay along the central Louisiana coast.

ARE ANY OF THOSE DAMNED THINGS SAFE?

Wrong on the Bubble, Wrong on Stimulus

Oh, now this is beautiful. Simply beautiful. Economics of Contempt posted a list of all the prominent housing bubble deniers from around 2005 or so. An endless list of AEI and Cato and Wall Street Journal "limelights" all insisting that the economy is fine, that housing is fine, and that anybody who is complaining about it is just an idiot.

Nice, but that's not the fun part.

The fun part is when Krugman revealed that all of these guys are stimulus opponents too! In fact:

There turns out to be a quite strong correlation between denying the existence of a housing bubble a few years back — and jeering at those who said there was — and insisting, now, that fiscal stimulus doesn’t, can’t work.

The question is, why do such people command such attention? As I’ve pointed out before, the same people who denied the existence of a housing bubble also told investors that budget deficits would send interest rates soaring; in other words, anyone who believed these people in the past, and acted on that belief, has lost a lot of money.

It's the same sort of Very Serious Person that was wrong on Iraq, wrong on Afghanistan, and (going back farther) wrong on the Cold War and on Vietnam. It's hard to see what these guys are RIGHT about, actually; they're so reliably wrong that you could probably make a fortune betting against their predictions!

The problem...the significantly less funny part...is that by the time their allies in Congress are done, you're going to NEED a fortune. Because once they're done with Social Security and Medicare, it's the only way you'll spend your retirement doing anything but eating cat food and wondering whether that lump will go away on its own.

Chait's being a dolt

Sorry, but gotta call 'em as I see 'em, and how else to describe this?

Moreover, I happen to think that liberals should be open to Social Security cuts as part of a balanced package of deficit reduction.

WHY? Is this one of those "truth lies in the middle" things?
Social Security isn't the problem; the Bush tax cuts, the recession, and two expensive overseas wars  are the problem. He KNOWS this. He's seen more than enough liberals explain exactly why and how this is the case. But he's ignoring them and taking potshots at them (seriously, read the whole post) in order to prop up Republican shibboleths and relegate seniors to an all-Whiskas diet. 


If that ain't a dolt, what the hell is?

So Apparently Dems Are Worried That They'll Lose the House

More so than they were, that is.

Funny thing how focusing on the deficit and on "bipartisanship" didn't pay any dividends, huh? We now know for a fact that the stimulus wasn't big enough (though most of us knew beforehand). We also always knew that stimulating job growth at all costs was the #1 job of the Democratic Congress, and what they'd be ultimately judged on.

We also knew that the Republicans were going to do whatever they could to block that, because it'd pay off for them. Doesn't matter how crazy they are. It's the Dems that are under the gun, not the Reps, and no amount of impassioned reminders that the Republicans' terrible governance was responsible for this will help.

But the Dems have done practically nothing, thanks principally to the Senate "blue dogs" that they protect so jealously, and time is running out. A whole lot of 'em are probably going to lose their jobs thanks to all this.

Appropriate, that, considering how they haven't given a damn about anybody else's jobs. Except, maybe, bond traders.

Witness The Face of the Teabaggers

Red, bloated, racist as hell and screaming at black men:

My favorite bit is probably around 3:30, when somebody started yelling "Mohammed's a pig". Repeatedly.

Duverger's Law is Dead

Well, so much for the idea that two-party systems produce stable governments. Canada and the UK had already beaten it senseless, but Australia just fired a shotgun round in its temple.

(Or, as was so eloquently and clearly said by the Australian electorate, "mbgffhf and also gghg vvjjv jmmbmbmbff". Words to live by.)

In any case, a lot of this is because the Greens apparently had a breakthrough. So, hey, maybe Nader's old crew should step it up. Looks like America might have the only two-party system left.

Edit: Yes, yes, technically Duverger's is about straight-up FPTP systems, and Australia's lower house uses IRV. Even so. 

You Gotta Be Kidding Me

Hey, Barry? Got a tip for you.

If you take a stand on something, even something controversial, don't take it back a day later. The people who did support you will feel betrayed—for good reason!—while the people who were mad at you will stay mad at you. Everybody else will just think that you're spineless, which is the last thing a Dem needs. 

Bad policy I can understand, especially by now. Bad politics is just shameful. 

Gibbs Just Keeps Getting Better

Instead of backing off, like a sane man would do, Gibbs is doubling down on this "professional left" crap. Yet he's saying that "he fully expects liberals to vote".

Why, exactly? There's a big enthusiasm gap between liberals and conservatives, and it's only getting worse. Liberals aren't going to be cowed into either silence or support by the whole "vote for us or you'll get the Republicans" line, especially when the White House itself installed a center-right candidate in Arkansas that can't possibly win.

I honestly don't even understand the point of this. Attacking the left isn't going to shut them up. Hasn't before, won't now. It won't endear the government to the right, either; the right ain't gonna vote for you, no matter how many liberals you piss off. The press might say some nice things about you because of how much they despise your typical "DFH", but that fleeting support will be long-gone by the time the election rolls around. They'll be distracted by a new shiny, and the left will still be pissed.

What the hell happened to "no-drama Obama"?

"Why I'm Not Hiring"

So there's a WSJ piece that people are talking about; it's from the POV of one "Michael Fleischer" from Bogen Communications, talking about why he isn't hiring people. Supposedly it's because of health care and benefits and all that horrible stuff that employees need to, you know, live.

Here's the thing, though. If you actually look into Bogen, you find out that there are far better reasons for why Fleischer isn't hiring. Like the stock price absolutely cratering last year. Or the settlement that they reached with a contractor who alleged "multiple causes of action for breach of contract and various torts"; a settlement that came after the contractor had already been awarded a cool $12.5 mil in "compensatory and punitive damages."

It also didn't mention that Mr. Fleischer's own compensation includes a cool half a mil a year in direct compensation and stock options, or that he's getting this money despite the stock price cratering under his watch. Hell, it was delisted from the NASDAQ in 2003. And it's losing money this quarter to boot. It did in 2009, too, if I'm reading this financial report correctly.

The best part, though, is that for all that he's railing against taxes, his company appears to have benefited from the current tax structure. $5.5 million in tax benefits, as a matter of fact, that they can carry forward to reduce tax liabilities against future profits. (Assuming, of course, that they turn a profit.)

So the answer to "why he's not hiring" turns out to be really simple: his company ain't doing so well. It's understandable, and I hope that Bogen pulls out of this intact. But it's sure as hell not the answer that he's pushing, and it's more than a wee bit dishonest to pretend otherwise.

5-Year TIPS Rates Are Now NEGATIVE

So sayeth the Krug-man:

Look at the lower left-hand corner: the real interest rate on 5-year inflation-protected securities is now negative. In other words, prospects for other investments are so poor that some investors prefer a safe asset that doesn’t quite keep up with inflation.

Yet to maintain employment, we need to sustain spending, one way or another. One way is to have the government take advantage of its low financing costs to spend on useful things; but the deficit peacocks in Congress are blocking that solution. Another is to get real interest rates low enough to get the private sector spending; but that, as we can see, means that the real interest rate on medium-term government debt has to be negative.

The only way you can do that is by having the Fed credibly promise to deliver significant inflation.

Oh, and the invisible bond vigilantes continue their invisible attack: nominal 10-year bonds at 2.71%.

I imagine that they are buying into an asset that doesn't keep up with inflation because they don't expect there to be inflation. And I expect that they'll be right.

Gibbs Railing Against "Professional Left"

Just another day:

The White House is simmering with anger at criticism from liberals who say President Obama is more concerned with deal-making than ideological purity.

During an interview with The Hill in his West Wing office, White House press secretary Robert Gibbs blasted liberal naysayers, whom he said would never regard anything the president did as good enough.

“I hear these people saying he’s like George Bush. Those people ought to be drug tested,” Gibbs said. “I mean, it’s crazy.”

Why, yes, those filthy dirty hippies should be drug tested, am I right?

("Right" indeed:)

The press secretary dismissed the “professional left” in terms very similar to those used by their opponents on the ideological right, saying, “They will be satisfied when we have Canadian healthcare and we’ve eliminated the Pentagon. That’s not reality.”

Of those who complain that Obama caved to centrists on issues such as healthcare reform, Gibbs said: “They wouldn’t be satisfied if Dennis Kucinich was president.”

The White House, constantly under fire from expected enemies on the right, has been frustrated by nightly attacks on cable news shows catering to the left, where Obama and top lieutenants like Chief of Staff Rahm Emanuel have been excoriated for abandoning the public option in healthcare reform; for not moving faster to close the prison at Guantánamo Bay; and for failing, so far, to end the ban on gays serving openly in the military.

A Democratic president and his mouthpiece taking shots at their own base in a fashion almost identical to the right. I can almost hear Gottfried's Iago the Parrot yelling "I may have a heart attack and die from the surprise!" as I read that.

In any case, all of those bits cited above are legitimate criticisms of the president's policies; far more than that "president Kucinich" stuff. I expect that that's part of the problem. It's easy to deflect the right's attacks, because they are utterly insane. They're based on ideas that are proven to be completely ludicrous, and aren't being presented in good faith in the first place. Liberals are far more dangerous. They have a point. Plus, I don't think Obama was really thinking about his own theoretical base when he was talking about "no red or blue America" and "teams of rivals" and all that. He, like so many Dems, assumed that the effective spectrum was between them and the right. That he might get criticism from non-conservatives may well have never occurred to him. Especially with all the Obamamania at the time.

So, who's Gibbs angry at?

While visibly frustrated, Gibbs did not specifically name any of the White Houses’s liberal detractors by name.

Oh. It figures that he'd never name any of them. That might get a bit inconvenient. The article mentions the Progressive Change Campaign's Adam Green, but he's just one of many. A lot of progressives are pissed these days.

Gibbs’s tough comments reflect frustration and some bafflement from the White House, which believes it has done a lot for the left.

In just over 18 months in office, Obama has passed healthcare reform, financial regulatory reform and fair-pay legislation for women, among other bills near and dear to liberals.

Obama is also overseeing the end of the Iraq war, with the U.S. on schedule to end its combat operations by the end of this month.

He’s also added diversity to the Supreme Court by nominating two female justices, including the court’s first Hispanic. Yet some liberal groups have criticized his nominees for not being liberal enough...

...The lack of appreciation or recognition for what Obama has accomplished has left Gibbs and others in furious disbelief.

Larry Berman, an expert on the presidency and a political science professor at the University of California-Davis, said he has been surprised that liberals aren’t more cognizant of the pragmatism Obama has had to employ to pass landmark reforms.

“The irony, of course, is that Gibbs’s frustration reflects the fact that the conservative opposition has been so effective at undermining the president’s popular approval,” Berman said.

“And from Gibbs’s perspective, and the White House perspective, they ought to be able to catch a break from people who, in their view, should be grateful and appreciative.”

See, this is what people like Gibbs (and Berman) just don't get. Progressives and liberals do understand that there needs to be a level of pragmatism. They do understand bargaining and negotiation. But as Green said in the article and as a lot of people have said elsewhere (including myself), this administration rolls over for Conservatives without bothering to negotiate. They aim too low to start with, and then trade off everything else worthwhile in exchange for practically nothing. They aren't willing to take a stand, aren't willing to pick issues to attack Republican intransigence on, and (as we see with this story) attack their own side at every opportunity.

The big problem is that progressives believe that the administration and this Congress (principally the Senate) is alternately weak and too willing to be bought-and-paid for by whichever corporation has the biggest pockets. They believe this because Obama and the Congressional Dems have given them every reason to believe it. Whining and moaning in the media won't change that, and won't make it go away. You have to prove to progressives that you have their best interests in mind. You have to show them that you ultimately respect their beliefs and will honor them as your core supporters.

But, instead, progressives get smeared with this nonsense.

Hell with 'em.

You Don't Say

Jonathan Chait on Journolist:

For people like me, the national debate mostly revolves around a liberal-moderate-conservative axis, and more hard-left or even traditional liberal views are fairly marginal. Journolist brought people like me into contact with a lot of those sort of liberals, and my main response was to realize that I'm a lot less liberal than I had thought.

No kidding!

Funny. I read material by—and interact with—people to the left of me all the time. It certainly hasn't made me "realize that I'm a lot less liberal than I had thought". If anything, it makes me recognize that they might have a point.

But, then again, I don't work for Marty Peretz, and I'm not drenched in every B.S. consensus that Washington has to offer. As one of Chait's commenters pointed out:

As the "senior editor" of a biweekly magazine Jonathan Chait presumable understands full well why Eric Alterman is arriving late in writing a story for The Nation. The sentence in Alterman's article that Chait really needs to take to heart is:
-- As a collective we held people's feet to the fire, encouraged excellence, bemoaned administration wimpiness and took numerous opportunities to remind New Republic editors and authors that they work for a reactionary racist lunatic.

A while back in one of these incidents where Chait yet again defends Martin Peretz from criticism Spencer Ackerman reminded us:

-- Everyone who works at TNR knows Marty is a racist.

But, hey, he signs the paychecks. Where You Stand, once again, Depends On Where You Sit. And since Chait sat with all the people who were cheering on Bush's Iraqi Adventure, is it any wonder that he got all uncomfortable when exposed to those disgusting Dirty F**king Hippies?

The Best Part About WikiLeaks

Edit: Ugh. When I wrote that piece, I hadn't counted on Thiessen's site being a festival of terrible HTML. Invisible post fixed.

Honestly, the best part about the whole Wikileaks phenomenon is the spectacle of Mark Thiessen saying that America should invade Iceland to kill or capture Julian Assange:

Assange seems to believe, incorrectly, that he is immune to arrest so long as he stays outside the United States. He leads a nomadic existence, operating in countries such as Sweden, Belgium and Iceland, where he believes he enjoys the protection of "beneficial laws." (He recently worked with the Icelandic parliament to pass legislation effectively making the country a haven for WikiLeaks). The United States should make clear that it will not tolerate any country -- and particularly NATO allies such as Belgium and Iceland -- providing safe haven for criminals who put the lives of NATO forces at risk...we do not need permission to apprehend Assange or his co-conspirators anywhere in the world.

So, what, you're going to send the troops into Reykjavic? Do you even know what the charge would be? It's not illegal to publish sensitive information in the United States, after all. There's no Official Secrets Act, Robert Novak isn't in the slammer, and there's no way that you could justify extradition on this.

But it gets better.

Arresting Assange would be a major blow to his organization. But taking him off the streets is not enough; we must also recover the documents he unlawfully possesses and disable the system he has built to illegally disseminate classified information.

This should be done, ideally, through international law enforcement cooperation. But if such cooperation is not forthcoming, the United States can and should act alone. Assange recently boasted that he has created "an uncensorable system for untraceable mass document leaking." I am sure this elicited guffaws at the National Security Agency. The United States has the capability and the authority to monitor his communications and disrupt his operations.

Monitor, perhaps. But how are they going to stop it, exactly? We know that the Wikileaks people are both very paranoid and very, very careful. They'll have distributed this stuff all over the place, and I doubt that any of them know exactly where all of it is. Much of it will almost certainly be in countries that would take a very dim view of the United States attempting to cut off their access to the Internet. And "attempt" is the key word. What is the US supposed to do to, say, keep this stuff from being disseminated on servers in Europe? Are they going to DDOS the ISPs? Are they going to try to hack in there and delete it off the servers? Are they going to send the Green Berets in to blow up the server farms?

Does Thiessen not think that the Wikileaks guys would have thought of that and spread the data out? Does Thiessen even know how the Internet WORKS?

No, Mark, they aren't going to start a war with Europe over Wikileaks. They aren't going to try a DOS attack, or nuke Iceland from space, or any of this other crap. They aren't even going to send a black-bag squad to arrest Assange, either, because it'd instantly become the most important, embarrassing story in the World and just raise questions about why Novak and the Pentagon Papers guy walk free. Stop pretending that this is a Clancy novel.

Prop 8 Overturned

Was there ever any doubt? It was hilariously unconstitutional.

Onward to the Supremes, I guess.

The big question is whether or not it's going to be a campaign issue this fall. My guess is "no". People have bigger things to worry about. Gay marriage is irrelevant when you're underwater and unemployed.

Memo to Abe Foxman:

When even Joe Friggin' Klein is saying that he can't support your stance, it's time to either recant or retire.

The Book Publishing "Death Spiral"

Not my usual baliwick, but I wanted to pass on this piece about the decline of publishing by Norman Spinrad, courtesy of Warren Ellis. Spinrad had a book rejected that the publishing company reviewer absolutely loved, because the "math" wasn't there.

What math?

This math:

Here’s how it works.  Barnes and Noble and Borders, the major bookstore chains, control the lion’s share of retail book sales.  They order centrally for all their outlets together, for instance there is a single buyer for all science fiction, all mysteries, etc.  How, you may well ask, can these buyers read and pass judgement on, for example, the over 1000 SF titles published in a year?

Of course the answer is they can’t.  Instead, an equation makes the buys of most of the books on the racks or blackballs the ones that don’t make it that far.  It’s called “order to net.”

Let’s say that some chain has ordered 10,000 copies of a novel, sold 8000 copies, and returned 2000, a really excellent sell-through of 80%.  So they order to net on the author’s next novel, meaning 8000 copies.  And let’s even say they still have an 80% sell-through of  6400 books, so they order 6400 copies of the next book, and sell 5120....

You see where this mathematical regression is going, don’t you?  Sooner or later right down the willy-hole to an unpublishablity that has nothing at all to do with the literary quality of a writer’s work, or the loyalty of a reasonable body of would-be readers, or even the passionate support of an editor below the very top of the corporate pyramid.

And there’s a further  wrinkle to it because what significant independent bookstores that still survive and the non-speciality outlets like WalMart subscribe to BookScan and have access to the Death Spiral numbers too and act accordingly.  If there’s a book to order at all, because in many cases if the chains’ order to net equation zeros out and they don’t order at all, the book in question doesn’t get published.  Back in the day, I knew of novels that were commissioned, accepted, and paid for but never published because the chains didn’t order.  Today BookScan prevents such expensive mistakes from happening by aborting them at the acquisition stage.

Voila, the Death Spiral.  And I too am in it.

This might be one of the reasons why Cory Doctorow makes his stuff available online for free. It's certainly disturbing. The book industry is already in a difficult position right now, and this is only going to make it worse, especially for new writers.

It also shows how "safe" equations can choke you to death. It reminds me of one line from The Big Short: "The Lomas Financial Corporation is a perfectly hedged financial institution: it loses money in any conceivable interest rate environment." No matter what happens, everybody loses, like a casino where the house burns their winnings at the end of the day.

Bobo's Still Ridiculous

So, Bobo, was the younger, leftier you a better writer?

Because, damn, the old, conservative you just can't stop writing about liberals and progressives using ridiculous stereotypes, and erecting strawmen big enough to blot out the sun.

About the only thing he got right was progressives' tendency to wring their hands over how and whether the Republicans will "blast" them for policies the Republicans don't like.  It makes sense. Democrats and Bobo share a predilection for blaming the Dems for Republican intransigence and ignorance. They came out as Supply-siders, for God's sake. Their policies are absolutely toxic to the health of America and are best ignored when they aren't ridiculed.

Still, its their backers that have the cash.  Young progressive Bobo could never make the fat stacks that old, reactionary, strawman-erecting Bobo can. Ideals often melt away when they bring in the big sacks with the dollar signs on them.  Young Bobo's gotta eat, after all, and why not fight to preserve and extend widening inequality when you're on the wealthy side?

Shame, though. I would have liked to have met young, impressionable, liberal Bobo. I could tell him about everything that he'd become: about his goofy comb-over, goofy glasses, and goofy arguments based on a goofy ideology. I doubt he'd enjoy it. But after having old Bobo inflicted on us, I'm sure the rest of us would.

WH Presser on Wikileaks Afghanistan Docs

This is a sad, sad thing. Gibbs is stammering and stuttering, trying desperately to look like he's on top of this. He sounds like he's about to cry.

The reporters are merciless. They aren't happy about how the NYT/Guardian/Der Spiegel scooped the hell out of 'em by doing real, honest-to-goodness investigative journalism. They're trying to score points by sounding tough, so as to have something to show for their (lack of) efforts. The smarter ones probably realize that they're struggling for their profession's existence: the main value of newspapers and television news was their ability to get interviews and primary source material, and wikileaks showed that non-newspapers can handle it.

The worst part is the whinging. Gibbs keeps saying "we didn't get to see the material beforehand! They didn't bring it to us! They won't talk to us!" Of course they didn't, Rob: Julian Assange has no reason to. You've already arrested his source, and he's been subject to a manhunt by your people since the helicopter footage leak. You aren't his friends. You aren't his allies. And since you aren't his government, he holds no allegiance to you. He clearly doesn't trust you, either, hence the Guardian/NYT/Spiegel stunt. He wanted to make sure that you couldn't pressure a single publication into shutting it down.

(As I write this, he admits that they would have tried to shut the NYT story down on "national security" grounds.)

The second-worst part is the "no new revelations" line. Leaving aside all the stories about the ISI bankrolling and supporting the Taliban, it only reinforces the idea that only novelty and spectacle is worth discussing. That's half the reason American media is so terrible. It doesn't need reinforcement. Assange himself has acknowledged that there is no single electrifying incident. He's said that the value of the documents is showing the broader nature and progress of the war. He's probably delayed releasing the really juicy stuff, since he's trying to minimize the harm the material could cause in the here-and-now.

What's really valuable, though, is the way that it snubs its nose at the trends in modern western media. Everything is short-form these days. Sound bites, twitters, and up-to-the-minute scrolling newstext are paramount. You can't get long-form analysis even if you want it. That someone would think that releasing a ton of information is a good idea, in the service of allowing people to understand it themselves is practically revolutionary in-and-of itself.  There's no mediation or digestion. You can read it for yourself.

(If you haven't, go read some of it now, if only to show to yourselves that you're grownups and not just "media consumers". The "propaganda" category is compelling, for example, since it gets into the nighttime anonymous letters that the Taliban uses to intimidate regular Afghans.)

...okay, now Gibbs just used "misunderestimated". I think we're done here. Go read some memos.

Wikileaks Blows Afghan War Wide Open

Holy hell, they did it.

There has been a lot of talk over the last few months about the thousands of documents that Wikileaks (and its founder/owner, Julian Assange) was sitting on about the Afghanistan war. That's one of the reasons why many had thought that Julian was going to get "disappeared" or at the very least arrested; the U.S. government would NOT want this leaked.

Well, get ready, because it's out. Not all of it, mind you. A lot of the documents have been withheld in order to prevent people from getting hurt. Once that's no longer an issue, they will be released too. Eventually it will all be published, assuming Wikileaks gets the change.

Assange explains his motivations in an interview on the Guardian website. He makes it clear that he knows what this means, and what sort of position this puts him in. He said "if journalism is good it is controversial by its nature. It is the role of journalism to take on powerful abuses; and when powerful abuses are taken on, there is always a back-reaction...this shows the true nature of this war." No doubt.

It doesn't look good, either. These are still early days and there are a LOT of documents to get through, but the news is grim, according to the Guardian's War Log analysis. The Afghanistan police and army are shooting at each other. The shadowy American special forces in "Task Force 373" are moving through the country assassinating Taliban targets, as well as killing civilian men, women and children—and even Afghan police officers—who stand in their way. Friendly fire deaths are rife.

(The Guardian, given early access to the logs, is doing impressive work in analyzing them.)

This is a major, major story. This is probably the greatest intelligence leak in history, or at least since the Soviets opened up the Russian diplomatic files. It cements Wikileaks as one of the most important organizations in the world right now. It means that investigative journalism is not dead in the age of the Internet. And, most importantly, it means that we should all keep a VERY close eye on what's going on with Julian.

I'm not exaggerating when I say that I fear for his life.

All This Time and "Jane Galt" is Still an Idiot

Nice bit from Thomas Levinson about Megan McArdle, the most baffling "economic analysis" in the Union:

The old joke* about Richard Nixon asked “How can you tell when he’s lying?”

The answer: ”When his lips move.”

I’ve finally come to the conclusion that something similar must be said about Megan McArdle. Perhaps lying is too harsh a word — but the serial errors that all fall on the side that supports her initial claims and that recur again and again in her work suggest to me that something other than mere intellectual sloth and sloppiness is the driver.

Ordinarily, such a record wouldn’t matter much, especially in journalism. In theory, a series of clips as riddled with error as McArdle’s would end most careers in high prestige journalism. Hot Air might still find a use for you, but The Atlantic?

But the problem is that McArdle is useful: she advances an agenda — that which comforts the comfortable — and she does so with what I think is truly her original talent, the capacity not to notice the ridicule and ferociously dismissive debunking that she so often attracts.

Being able to be wrong in a form and fashion that aids the powerful, and possessing the ability not to mind a life that must be thus lived in willing embrace of error…now that’s a trick.

See, you can always tell who wasn't around back in the day, around 2002-2003; back when men were men, women were women, and even conservatives used pseudonyms because they weren't being given BS sinecures at otherwise-respectable publications. "Jane" was always wrong. She was probably the most reliably wrong blogger I can easily think of. Glenn occasionally said something insightful about law, that green footballs guy would talk about tech, and even that one guy who called me a "megalomaniac" would post some interesting stuff about cell phone tech.

(I think his name was Steve something-or-other.)

But Jane? No, Jane was always wrong. She was either citing some bit of Econ101 lunacy as gospel truth, or erecting some strawman about Krugman, or writing apologias for Wall Street/Pharma Corps/Other Big Businesses, or predicting the doom of the Democrats and saying that the Republicans are a bigger-tent party than the Dems. It was always some damned thing, and it was always wrong.

(No, I didn't make up that last one. )

Thing is, it didn't matter. It was quickly apparent that she was being rewarded for being convenient, not right; the arguments were just cover for people to use when justifying their pre-existing opinions, nothing more. As Levinson said, she "aids the powerful"; not surprising, considering she's a child of immense privilege who exploited that position to get where she is today. "Right" doesn't matter as much as "rich and useful".

Levinson demolishes her hamfisted attacks on Elizabeth Warren; I won't really get into that, since you can read it yourself. But there is a bit that I'll focus on:

McArdle relies on the strength of her platorm. As “Business and Economics editor of The Atlantic” she routinely writes in assertions that we are to accept on her say -so...this argument from authority is never that strong, and, as McArdle demonstrated very recently, can descend to pure, if unintended, comedy...[e]verytime someone gets something thing wrong in a consequential way, the loss of trust should advance, ratcheting up with each such error detected, to the point where it becomes the safest default position to assume that someone — McArdle, for example — is always wrong till proven otherwise.

She dropped the pseudonym years ago, and that adds an interesting spin to Levinson's point. Jane Galt" was an obvious pseudonym, just as "Demosthenes" is. The strength and weakness of a pseudonym is that it starts off as a Tabula Rasa; there is no reason to trust you, but no reason to distrust you, either. You have to build up your own reputation and "authority" through the strength of your arguments. If you're right, you develop authority; if you're wrong, people have no reason to trust you.

She was always wrong. She was always getting demolished. Real progressive economists—she's not really an economist, by the by—and even pseudonymous progressives like me would tear her up on a daily basis.  Sure, she might be good for some laffs, but you would never cite her. She could never successfully argue from authority, much as she tried, because she didn't have any.

So she pulled the ripcord, ditched "Jane Galt", and became Megan. She didn't have to drag around that reputation anymore, because most people who weren't around during her "Jane" days would just engage with "Megan McArdle, economic analyst". The baggage was gone, and she could move on. Sure, there would be the occasional wiseass who would bring up Jane Galt, but no matter; she still gets to be an "expert" in the eyes of most people thanks to her position. Everything that pseudonymity rejects—real-world authority, the credibility involved in using your real name, your physical presence in a real community—is propping her up now. Galt may have always been wrong, but she's Megan now.

But Megan's always wrong too. Levinson called it, and loads of other people (TBogg, Brad DeLong, Atrios, lots of others) agree. She's just as wrong now as she was then, if not more so. As I said, Levinson has completely demolished her; and now every time she tries to act like an authority, someone can just point to Levinson and say "why should we take you seriously again?" It's a good question. I couldn't answer it.

It's Jane all over again. But this time, she's got nothing to escape to. She's stuck with "Megan", stuck with Levinson, and stuck with her own poorly-thought-out opinions and tattered "authority". Nowhere to go. Nowhere to hide.

Edit: I'd also highly suggest Susan of Texas' collection of comments from Megan's blog, where Megan gets schooled over and over again. That's something that was always true back in the Galt days; her comment threads would be immensely entertaining, since her commentators would absolutely tear her up. I think they had a drinking game or something.

Asking the Wrong People

The New York Times has a nice piece discussing what Obama needs to do to get re-elected, or (even better) hold the House this year.  Good idea.

Sadly, the Times' opinion of "balanced advice" is as bizarre as it is useless. You don't get useful advice from useless New Dem losers like Mark Penn and Harold Ford, whose policies will only jack unemployment even higher. You certainly won't get it from the Times' selection of wingnuts like Ari Fleischer and David Frum who are joyously concern-trolling their little black hearts out. That's all they have on offer.

You'd think they'd bother to add at least one actual progressive on there. Get Markos or Yglesias or Klein or someone that they can kinda-sorta call a progressive. Apparently not.

(No wonder Obama's in a bubble. Why emerge from it, when you all you have to read is that?)

Wealthy Defaulting More Than Others on Their Home Loans

Well, well, well. We knew it was probably the case, but I never would have expected it was this bad.

Whether it is their residence, a second home or a house bought as an investment, the rich have stopped paying the mortgage at a rate that greatly exceeds the rest of the population.

More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.

By contrast, homeowners with less lavish housing are much more likely to keep writing checks to their lender. About one in 12 mortgages below the million-dollar mark is delinquent.

Though it is hard to prove, the CoreLogic data suggest that many of the well-to-do are purposely dumping their financially draining properties, just as they would any sour investment.

“The rich are different: they are more ruthless,” said Sam Khater, CoreLogic’s senior economist.

 Well, yes, of course they are. But they also get better financial advice, free of all the moralizing BS that gets shoved down the throats of everybody who doesn't have accountants and financial advisers to tell them what's actually in their best interests.

The problem here isn't that the wealthy are defaulting, it's that other people aren't. Logically, everybody should have a similar likelihood of walking away from an underwater home. In fact, according to economic doctrine, the poor would be more likely, since they've got less potential cash to lose if their credit goes south and have homes that are worth less.  Yet they're essentially indoctrinated to believe otherwise:

The rapper Chamillionaire[...] recently walked away from a $2 million house he bought in Houston in 2006.

“I just decided to let it go, give it back to the bank,” he told the celebrity gossip TV show “TMZ.” “I just didn’t feel like it was a good investment.”

The rich and successful often come naturally to this sort of attitude, said Brent T. White, a law professor at the University of Arizona who has studied strategic defaults.

“They may be less susceptible to the shame and fear-mongering used by the government and the mortgage banking industry to keep underwater homeowners from acting in their financial best interest,” Mr. White said.

Was there ever any doubt?

So, once again, whenever somebody with a crapton of money starts lecturing you on TV about the morality of debt repayment, make sure take it with a gigantic hunk of salt. He probably already has his keys in the mail.

Obama Rolls Over for Netanyahu

I knew he'd roll over. I didn't know how hard.

"Well, I just completed an excellent one-on-one discussion with Prime Minister Netanyahu," he began. For those tuning in late, he added at the end: "So I just want to say, once again, that I thought the discussion that we had was excellent."
Netanyahu was pleased with the pandering. "Mr. President, I want to thank you for reaffirming to me in private and now in public, as you did, the long-standing U.S. commitments to Israel."

Obama didn't even mention Israel's settlements until a reporter inquired -- and then he declined to say that Israel should extend a moratorium on settlements that expires in September. Avoiding any criticism of Israel, he instead directed Palestinians not to look for "excuses for incitement" or "opportunities to embarrass Israel."

That last quote is absolutely incredible. What could be a greater "excuse for incitement" than Netanyahu's complete willingness to bulldoze the entire West Bank and fill it with settlements?
Well, that's that. I think, at this point, we can safely say that Israel can literally do whatever it pleases. There are no repercussions, and there aren't going to be any repercussions, and considering how many in Netanyahu's coalition are barely-concealed "transfer" (read: ethnic cleansing) advocates, that fact is goddamned scary.

Mearsheimer and Walt couldn't be more vindicated.

"How to Access the Internet in 2025"

Well, now, this is brilliant:

Before signing on, please ensure you have received your RealIdentity card from local authorities. Signing on to the internet without identifying yourself has been ruled illegal in the Stop Anonymity Act of 2012, and you need to be sure to associate your comments, emails, posts and more with your real name. Setting up your RealIdentity is easy, as your computer (MacOS 15 or ChromeOS7 and higher) will automatically connect to your near-by card, verifying it with your biometric data. Do not put on shades, veils, contact lenses, and please shave before the biometric scan starts; it is advised to not perform biometric authentication after a long night of drinking...

...Many content offerings depend on the internet you’ve signed up to. If you’ve signed up with the GoogleAppleAmazon Internet, then you have one-click access to a great digital library, many movies, as well as a certain approved set of homemade web pages. If you’ve signed up with the DisneyWarnerBrosViacom internet, you get a different digital library, set of movies, and approved homemade web pages.

This is incredibly timely, considering that Blizzard has just announced that you will need to use your real name on their forums. Or, as they call it, your "RealID".

Yep.

The Internet is a great idea. I'll miss it when it's gone.

Pelosi: "End the Filibuster!"

Demosthenes: "Damned Straight!"

House Speaker Nancy Pelosi has some advice for her Senate counterparts: Try majority rule for a change. Pelosi, in an interview with the Huffington Post, called for an end to the filibuster, which she labeled "the 60-vote stranglehold on the future."

Pelosi (D-Calif.) said that "the Senate has to go to 51 votes, and not 60 votes."

The filibuster, which was not an original element of the Senate, has evolved over the body's history and has only recently become the upper chamber's standard operating procedure. The Senate was designed as a majority-rule institution that allowed for extended debate. Under the Constitution, the vice president is empowered to break 50-50 ties. Such a clause would be wildly out of place if the framers intended for a 60-percent majority to be required.

Senate Democrats are eying January as the time to reform the filibuster, when the Senate convenes a fresh Congress and votes to establish rules. New rules can be approved by a majority vote if the presiding officer, Vice President Joe Biden, allows the vote to go forward. Liberals in the Senate worked hard to reform the filibuster between the 1950s and 1970s, eventually succeeding in reducing the threshold from two-thirds to 60. Sen. Charles Schumer (D-N.Y.), chairman of the Rules Committee, is holding hearings looking into the future of Senate rules and Senate Majority Leader Harry Reid (D-Nev.) has endorsed some sort of reform.

Pity this couldn't have happened last year; it would have meant a whole hell of a lot for Americans' health. Then again, it probably should have happened last January; it was pretty obvious even then that the Republicans would be playing the obstructionist game, and that the Dems needed to seize any advantage they had.

As it is, I fear that this will run up against Democratic losses in the Senate; pundits will argue that "the public has said that they want the Republicans to have a greater say"; and Dems are nothing if not knock-kneed when been criticized by pundits. The time to take the advantage was back when they were ascendant.

Still, it's good that Pelosi has gone on the record on this. Considering how effective she's been when compared to her Senate counterparts, her endorsement is a big deal.

(By the by, happy belated Independence Day. I wasn't in a position to wish it until now. But I do wish it, and do still believe that America is an experiment that is worth its tribulations.)

British Treasury "Brace for 40% Cuts"

Well, if the United Kingdom wasn't in a depression before, it'll certainly be in one after this goes down.

Cabinet ministers have been ordered by the Treasury to plan for unprecedented cuts of 40% in their departmental budgets as the coalition widens the scope of its four-year austerity drive.
The eye-watering demand from the chief secretary to the Treasury, Danny Alexander, was sent this weekend to cabinet colleagues ahead of a week in which ministers will step up emergency cost-cutting across the public sector.

The only departments not included in the Treasury trawl will be health and international development, which have been "ringfenced" for the current parliament. Education and defence will also escape lightly. Alexander has told the education secretary, Michael Gove, and the defence secretary, Liam Fox, to plan for two scenarios – cuts to budgets of 10% at best and 20% at worst over four years. All other departments – including the Home Office, the Department for Work and Pensions and the Department for Transport – have been ordered to produce plans showing the impact of cuts of 25%, and at worst 40%.

Let us remember that this is all in the service of a complete fantasy: the idea that the invisible bond vigilantes will come in and punish the Sterling unless they try to fix budget issues that may hit 30 years from now IN THE MIDDLE OF A DEPRESSION.
(But, of course, Defense will remain untouched.  Since that's just how it works.)

The rich will become richer, and the poor will become desperate. Hell, they'll become homeless:

Ministers were also warned last night that the number of people classed as homeless in Britain could more than double because of "unfair" benefit cuts. The National Housing Federation, the body representing England's 1,200 not-for-profit housing associations, predicts that impending cuts to housing benefit will put a further 200,000 people at grave risk of homelessness and lead to a concentration of social problems in the most deprived areas of the country. Currently 140,000 people are classified as homeless in Britain.

Great. It's Dickensian England with iPads. Everything old is (horribly) new again.