Romney - killed by the echo chamber

What's the origin of the 47% remark? Well, it's a combination of a fact mixed with a lot of prejudice and served with a thick helping of wilful blindness.

Let's go over it. The fact that all of this is based upon is the observation that between the effect of the recession on household incomes, and the raising of income tax thresholds since Reagan, around 47% of households pay no Federal income tax.

By itself, interesting, if not useful. Why not useful? Well, to begin with, the stat only describes one form of taxation, and one form of direct taxation at that.

• Virtually all households pay property taxes, either directly, or as a portion of a rent negotiated with a landlord who knows property taxes will be an expense that needs covering.
• Virtually all human beings in the US pay sales taxes, from seven year olds spending their pocket money to Warren Buffet.
• Virtually all commerce involves taxes somewhere along the line.

Additionally, as many Democrats are keen to point out, a secondary set of income taxes, collectively called payroll taxes, are paid to cover the costs of some government services, such as social security and unemployment insurance - to ensure nobody feels like they're subsidizing those high-rollin' pensioners.

What people do not pay income taxes? Well, the list is broad, but it generally covers:

• Most of the military. The starting pay for an infantryman, for example, is around $15k per year.
• People who are between jobs, have paid income tax all their lives, and will pay them again, who may or may not be receiving services paid for out of payroll taxes.
• People who are students, and expect to earn money and pay income taxes when they end their studies and get a job.
• Pensioners, who have paid income taxes all their lives, and now are living from a combination of the services their payroll taxes covered, and private funds such as IRAs they saved while employed.
• Hard working blue-collar workers, especially in the South, where wages are terrible. Many would welcome the chance to pay income taxes, if only their cheap employers would actually pay them enough to cover them.
• Lazy people who live with their parents and can't be bothered to work
• A small number of the very rich, who are able to afford the right tax accountants.

With me so far? At this point, the "47%" looks entirely uncontroversial. Only two groups, the last two, could be categorized as being able to pay taxes, but failing to do so out of a lack of civic responsibility

But... no, that's not how it was spun. The controversy over the "47%" started with a Washington Times column that highlighted the fact and... to give you some idea of the tone of the article, described these predominantly low income individuals as "Lucky Duckies". "Lucky". Because you have such a low income that even the politicians have recognized you probably can't afford to pay their salaries.

Where does Mitt Romney fit in to all this? Well, the fact half of households don't pay income taxes became a right wing talking point. It was repeated ad-nauseum. Because, apparently, paying taxes is the most awful thing a government can force you to do (what?), it became taken as read that this was a terribly unfair thing and that these people who weren't paying taxes were just mooching off the work of everyone else. And in comes Romney, and he makes a truly big mistake.

I don't mean Romney made a political error. You already know that. I mean what he told a group of rich doners at a private fundraising dinner was factually incorrect. He mixed the prejudiced version of the "half of all households" story, and blurted out a nonsense. You see, in right wing circles:

• Democrats just want to take all the money from hardworking people and give it to lazy people.
• Lazy people like getting free money.
• Democrats do this because they think lazy people will vote for them.

So Romney stated the following:

• That the 47% consists of people getting handouts, rather than people who earn so little they don't pay a particular tax, right at this second, although many - most even? - have done so in the past and/or the future.
• That the demographics of the 47% consists pretty much entirely of Obama supporters. They'll never vote for Romney. Despite the military, pensioners, and southern blue collar workers, making up a large proportion of the 47%.

And then, to add insult to injury, knowing full well that "the 8%" (that is, those on unemployment benefits) are part of the 47% too, Romney made it clear he didn't care one hoot about them, despite the fact he's trying to run as someone who'll fix the economy.

The problem here is the echo chamber. Because people who live in the echo chamber don't get to hear the truth, if what they've heard is not the truth, until it's too late. Romney should have known on some level that what he was saying was utter rubbish, but was never handed that opportunity. If all you read is the Washington Times, all you watch is Fox News, and if you convince yourself that it's not worth getting your information outside of those circles because, well, people will lie, then more fool you. The facts about those not paying income tax were easy to see, but they were only drawn to Romney's attention long after he slipped up, and he slipped up after years upon years of being told, over and over again, that:

• Half the population doesn't pay income tax
• That half of the population are "lucky"
• That half of the population is there by choice, are there because they're lazy
• That Democrats prop up the lazy, because they want their votes.

When a lie is repeated often enough, even the smartest people out there start to believe it. Unfortunately for Romney, a smart, capable, individual who probably would make an excellent President, he chose to live in the echo chamber, where such lies are inevitable.

Rethinking abortion

I'm going to preface this with a summary because this is such a hot button issue, that it's likely to get misunderstood. The position described by this blog entry is this:

I am pro-choice, despite misgivings about the morality of abortion. I consider the legalization of choice important, but there are issues I care much more deeply about, that are more black and white, and my support for those latter issues overrides my support for the first.

-------------------

There aren't many reasons for a liberal to support the Democrats these days. The Democrats have anti-liberal policies in most spheres. They're pro-war. They're pro-torture. The TSA has continued to grow and become more draconian under Obama's watch. They support the war on the drugs, even going so far as to undermine state initiatives to curb the excesses of that war. They care little, or not at all, about the unemployed until it's a year or so before the next election and realize that lots of unemployed people equals lots of votes for the other guy. And I get into arguments with like minded liberals online, and usually, after a large number of statements like:

• Yeah, but they ended the war in Iraq
• You mean they kept to the timetable Bush agreed to? And they attacked Libya, illegally!
• But... they passed healthcare reform!
• Yes, but the reform they went for was anti-liberal. Now we're forced to buy insurance from the same abusive assholes who caused the problem in the first place, and with one or two exceptions, the same crap still exists. How is this better?
• But, uh, Bush!
• Can you point at a Bush policy of importance that Obama hasn't ultimately continued, or even extended?

the issue of the Supreme Court comes up. If we allow a Republican to win, says the reluctant Democrat, they'll appoint a conservative to the Supreme Court, tipping the balance and causing abortion to be banned!

And because I'm a liberal, and I support choice, that's usually the point at which I sigh and get frustrated. If the Democrats can always rely upon liberals to support them, even when they're anti-liberal, then how do we get the Democrats to actually stop being anti-liberal?

But as I've thought about it, I've become more and more convinced it's a bad argument anyway. Abortion is an important issue, but there are a hell of a lot of important issues. And for some reason, it's OK to throw our children under the bus in pointless wars, our dissenting voices and whistle-blowers under the torture bus, our cancer patients and other people in severe pain under the drugs war bus, our unemployed under the foreclosure bus, and our general freedoms under the bus, but it's not OK to "throw women under the bus" - or rather, a small number of women who, rightly or wrongly, end up in the doctor's chair wanting to end an unwanted pregnancy.

What's wrong with that picture?

Does it do liberalism any good if only one issue is fought for? And wouldn't it take care of the choice issue long term if there was a major political party willing to fight for liberal principles - that was scared of losing the liberal vote?

And, hold on a moment, but is this really the most important issue liberals should be fighting for, to the exclusion of everything else? Those Democrats who are considered liberals rarely spend as much effort fighting, say, the war on drugs, as they do the war on abortion, and yet there are significant similarities between the two, obscured in some ways because the war on drugs is current and criminalized by definition, and the war on abortion is not.

The war on drugs causes both "good" and "bad" uses of proscribed drugs to be banned. So both dope using cancer patients and stoners both end up criminalized. It's not entirely clear that many states would ban abortions in all circumstances, but despite that I'd agree with most assessments that both rape victims and "abortion as contraception" users would end up suffering under the ban.

The war on drugs makes matters worse for those who plan to take drugs anyway. Supplies become unreliable and unregulated, making them dangerous. Those who sell the drugs are criminals by definition, which means an above average interest by the criminal element in managing the distribution chain. Sellers have reasons to push overly addictive drugs, knowing there are no sanctions for doing so that don't apply to other drugs. Likewise, a cynic would probably wonder how many anti-choice advocates have shares in companies that sell wire coat-hangers.

Both the war on drugs and war on abortion are ultimately wars on the body, a belief that government has the right to intrude upon an individual's ultimate right to decide what their body can and cannot do. Governments have every right to help individuals make the right decisions - and obviously has every right to minimize the danger of one person's choices to others - but there are lines that should not be crossed. But, actually, in many ways the government has a stronger right to regulate abortion than it does drugs. At some point - the religious might argue around two weeks after the LMP, others would look at the development of the zygote, embryo or fetus and point at something significant such as brain development or a heartbeat - one has to come to the conclusion there's another body involved.

In our zeal to protect a woman's right to choose, it's become obvious that equal or greater principles have been thrown under the bus. More-over, it's not clear to me that simply the addition of a conservative to the Supreme Court would cause permanent, irreversible, damage to the cause. A conservative might overturn Roe vs Wade, but it would still be necessary for states to take the next step, and it's not immediately clear many would be successful. Free movement would also make it difficult for such laws to be effective. This is not to argue that a state could not cause hardship in its zeal to ban abortion, but a Republican winning an election does not mean an immediate, draconian, nationwide abortion ban.

Liberals should not focus on one issue to the exclusion of every other issue at each election, and especially not on this one. The Democratic party should not be allowed to think that its support for one issue - and the Republican's polar opposite opinion - should guarantee support for it from the liberal bloc. If the Democrats are ultimately an anti-liberal party, they shouldn't have our support.

Republican presidency? Can't be worse

It's looking increasingly like the Republican nominee for President will be either Mr Romney or, slightly less likely, Mr Gingrich. Romney has been the front runner for most of the campaign (and when not, the man to beat.) Gingrich follows a trail of beaten down nominees of the moment - Bachmann, Perry, and Herman Munster, who have had a few moments in the Sun before it become obvious they were unelectable lunatics.

From the point of view of this liberal, I'm down with either. I wouldn't vote for either, don't get me wrong, but Obama needs to be thrown out at this election, and pretty much the only reason not to vote him out is if the Republicans nominate someone much worse. Given that, I can safely cast a vote for a liberal third party candidate at this election knowing I will not be throwing the country to the wolves by not voting for a lesser-of-two-evils candidate.

Why Gingrich and Romney? Well, I'm sure the former is going to be more controversial, but actually I'd like either to win because I don't believe, at heart, either's evil, and Romney has the added benefit there's a 10% chance or so that he'll completely divide conservatives when he becomes President.

While the knocked down candidates may have been loonies, neither Gingrich nor Romney are. Both are to some degree technocrats, they may rant and rave in public and occasionally say some very extreme things, but in power they try to find academically smart solutions, according to their respective ideologies, to real problems.

Is there any evidence Romney would be worse than Obama on the issues that matter most to me? I don't see any. Obama's far right views on the surveillance state, on torturing whistleblowers, on extra-judicial executions, do not seem to me to be bettered by anything either has said. Indeed, it seems probable that those views both has put in public that appear to show fear of terrorism are as much to do with appealing to the Republican base as anything else. There is a strong chance that Romney would actually be more liberal than Obama, and a slight chance that Gingrich would be too.

Romney would be an interesting President because he's a city man in a party normally associated with country politics. That means he takes some interesting positions not normally widely associated with Republicanism such as gun control. If Romney can engineer a Republican dominated Congress, that could be his - and the Republican's - undoing. Conventional wisdom is that Republicans would never vote for a gun control bill. But the reality is that dominating congress can only be done by taking seats from Democrats, and in general the pro- and anti- gun-control lines are drawn not by ideology but by location and demographics. This is why someone like Guiliani, considered far-right by most liberals, takes the pro-gun control line. And while Democrats are scared to go there, Republicans have no reason to be. A Republican party dominated and controlled by City-Republicans may well pass some laws that undermine key planks of its support for decades to come.

Gingrich's major problem is that he's also somewhat on the slimy side when it comes to politics, he wants power (which is why he keeps running for President despite - this time excepting - always being knocked out at an early stage.) He was extremely successful with the framing exercises of the early nineties and practically made "Liberal" a bad word. He went after Clinton for consensual sexual transgressions and almost brought the country to its knees in doing so despite his own, somewhat worse, private life.

But Gingrich is, at heart, a technocrat. He tries to find free market solutions to real problems rather than pretending the problems do not exist. While Romney's healthcare reforms may have formed the roots of Obamacare, the reality is that they first cropped up during Gingrich's leadership of the opposition at the time of Clinton's health care proposals. The healthcare proposal, which included an individual mandate, never went anywhere, but it was typical of Gingrich's approach, an attempt to craft a system that would leave the majority of the health system in the free market, while creating an infrastructure to ensure it was available to everyone, the goal of any real healthcare reform.

Gingrich is also notable as being one of the early supporters of the Internet, at a time when it was barely heard of outside of nerd circles.

The bottom line is that I don't think either candidate will cause the collapse of America, or if they do, Obama would do it sooner. As such, given a vote for Obama is a support for torture, executive ignorance of the rule of law, unnecessary and blatantly illegal wars, compromises that are worse than doing nothing, and not giving a rat's behind about the unemployed, victims of corporate malfeasance, and general cronyism, I believe that it would be better to vote for a liberal third party thereby allowing either candidate to win, than to vote for Obama.

2012

Not looking forward to the first US Presidential election where I can vote. Largely because it looks like both candidates will be far to my right.

I'm desperately hoping the Republicans will pick a moderate like Romney. Romney is an out of touch conservative, and he has a number of views I strongly disagree with, but I believe he's a good man at heart.

This doesn't mean I'll vote for Romney however. As I said, he's far to my right. Neither will I vote for Obama, such a vote would be unconscionable. To stand as a liberal, and then when in office to promote extremist right wing policies such as torture, imprisonment without trial, extrajudicial executions, and more wars, is beyond forgivable. He will not get my vote even if the alternative is a wacko like Bachmann.

Obama isn't Clinton. Clinton stood as a right wing Democrat, made an effort (albeit a poor one) to promote the policies he stood for, and didn't drift far from what he always claimed to be, certainly never turning into an extremist. Obama essentially prevented the left from having a voice by stealing it, by saying "Oh, you're against the more extreme aspects of Bush's regime? Vote for me, I'll change it!", and then doing exactly the same crap.

So I'll vote, but I'll probably either pick a third party that's genuinely moderate or left wing, or I'll write in a candidate.

Why?

Wouldn't I be throwing my vote away?

Well, no. If you feel the same way I do, then I urge you to do the same thing. Obama won in 2008 because he courted liberals, something that neither Gore nor Kerry were willing to do. And Gore and Kerry didn't because, despite real records of liberalism, both were stuck in the Beltway Feedback Loop where it was simply taken as read that liberals were irrelevant and a bad thing.

Gore learned the hard way that this was a stupid move when Nader took enough votes in 2000 to make it obvious that had Gore gone a little to the left on certain key issues, he'd have had enough support to swing the election in his favor. Nader is usually criticized for taking votes away from Gore, but I'm not sure that's true. It's not clear to me that everyone who voted for Nader would have voted for Gore in Nader's absence, it seems more likely that most of Nader's supporters would have stayed at home.

Kerry didn't have a Nader either, but he found himself in 2004 fighting an election against an awful President... and losing. Even in 2004, Bush had lost his post-9/11 lustre, and I couldn't find a single person who had anything nice to say about him, but Kerry quickly gained a reputation, fairly or unfairly, as an establishment hack, as someone who would simply continue in the same mold as Bush even if he said otherwise. And the attitude I sensed from most liberals was that, if they were going to vote at all (and it wasn't clear they were), it was simply to get rid of Bush. And that wasn't enough for many, when it was assumed Kerry would do the same things as his would-be predecessor.

Obama's betrayal means it's going to be harder for some years to find a Democrat who can be trusted by liberals. It'll mean someone will need to have decades of political activism behind him or her, with a track record of promoting liberal causes. There are people who fit that - Pelosi is a name that springs to mind - but I'm not sure they have what it takes to get past the primary stage, and, for example, Pelosi has had enough demonization from the right that she'd find it hard to get broad based support anyway.

Either way, Obama needs to lose. It has to be shown that it's not enough to pretend to be a liberal when you have no power, you have to at least try when you're in office. I can handle Obama failing to push through liberal laws through a hostile congress. I can't handle the continuation of Bush's security state. And I can handle four years of a Republican President if that's what's necessary to prevent it from happening again.

On Krugman's "heresy" and my thoughts about 9/11

I have to admit that my first response to reading the many attacks on Paul Krugman post 9/11/2011 was bafflement. I read Krugman's piece, filed it under "Yup, that's probably how pretty much everyone except the extreme right thinks", and went on with my day, unaware that a furore had broken out. When I finally noticed, I read the attacks and... well, didn't understand them. Plenty of negative labels, but virtually no reasoning or explanation of why the piece was considered beyond the pale. Indeed, given the propensity of Krugman's regular critics to quote him out of context in an effort to mislead about what he's actually proposed, I wondered if this was merely a more extreme case, coupled with the "rightwing outrage machine".

So, I continued reading, and quite honestly, it wasn't until the center-left started to pile in that I started to "get" the argument. The center left was, at least, able to give reasons why they feel that on balance, given the pros and cons, they felt, overall, in general, that perhaps Krugman had crossed the line.

What was the line? Well, supposedly it was criticizing the leadership of the country circa 2001, and because that leadership was Republican (Krugman even used the term "conservatives"), this was partisan. And it was wrong to be "partisan" because, well, 9/11 was a tragedy, and you must not be partisan on a day of tragedy.

Am I right in suggesting that was the core issue the Republicans who bandied around comments like "Shameful" and even "Treason" were most concerned about? If I'm not, then please don't continue to read this post. Reply to it, and explain why I'm wrong.

My view of Professor Krugman is this: the man is one of the few "pundits" (well, he writes opinion pieces for the New York Times, so I guess he qualifies as one) who speaks uncomfortable truths, and as such he's been pretty much frozen out of the political system, treated as an "unserious" person in much the same way as Glenn Greenwald. There's a massive gap between what he actually says, and what his critics claim he says, as becomes obvious when you read his blog on a regular basis. And, for the most part (one rather poor blog entry on gold not included) he seems to be right on the money.  No pun intended. In some ways, what's bizarre is how conventional his thinking is. His economics are merely an evolved set of the same principles that were used from the 1940s to the 1970s. He opposes unnecessary wars, and is unhappy about the direction of the country in that sense. Krugman seems to feel that unemployment is a problem, and that it's somewhat cruel to put people out of work if you can easily avoid it.

So with that out of the way, what of Sunday's blog entry? Was it appropriate?

I'm going to speak for myself right now, because I can't speak for anyone else. I do not, obviously, speak for Krugman. I couldn't even if I wanted to.

I love the United States. This is a wonderful country. It still is. There's a core here that stands for freedom, for democracy, and for "the pursuit of happiness". That latter term is absolutely the right way to describe the people of America, for much of liberty is simply a method to that end. Our economy and laws reflect a people that wants to build and create, and use that production to lift us ever higher. When we as a nation are at our best, living our principles, we not only make things better for

So any attack on it, inside or outside, that undermines our liberties or substantially changes our voice, forcing it to utter words and perform deeds that contradict our very essence, is something that upsets me. And I believe that my sentiments are shared by many of those on the left.

What happened post 9/11 was an attack on those very principles. We saw one dubious war, and one completely unnecessary war, with no regard to basic moral principle that war is a terrible act that must be executed only at the most extreme necessity. We saw our government adopt draconian security policies, culminating in the imprisonment without trial of "suspected terrorists" - a large proportion of whom have subsequently been found to be entirely innocent - and we saw the adoption of torture and general abuse into the mainstream.

Government abuses aside, we also saw an unpleasant shift in our political establishment towards right-wing extremism. By this I mean many mainstream Republicans have started to bang the drums of intolerance and hatred in the name of "fighting terror", especially demonizing ordinary Muslims. From the attacks on those proposing building a Mosque in lower Manhattan, to Rep. Peter King's hearings on "radicalization", these are attacks on our principles, they fight liberty. They fight the pursuit of happiness.

But what of this? Is it possible for someone to to be as angry about the hijacking of American politics as they are about the killing of thousands through the hijacking of four planes? Leaving aside the hundreds of thousands of people who have died precisely due to the actions those who abused this event performed, there's also a critical element those who compare one to the other ignore: this tragedy was built upon the other. These 3,000 people were not murdered in a separate incident, but their deaths were exploited to bring about this result.

And so, for many of us on the left, we associate 9/11 with more than the murders of 3,000 people. We see a much greater tragedy. We are angry about the greater tragedy/ And we mourned on Sunday not just for the 3,000, but for the greater damage that was caused. You can't expect us to put our feelings about that day in a box, simply because you care less about those principles we saw damaged than we do.

A thought about States Rights

My limited understanding of the States Rights argument is that proponents want to switch to a system where each US state has high sovereignty, with only some functions transferred to the Fed, notably the currency, military, etc, and some limited cases where it's useful for the Fed to promote cooperation between the states.

Ignore the military for a moment, let's focus on the economy.

Excluding Britain, isn't that pretty much a description of Europe? Is the economic side of this system working there? If not, why?

(BTW isn't it somewhat ironic that the people who are usually the loudest advocates of this system would be the most offended if they heard the concept described as "European"? Of course, they'd rightly argue Europe was inspired by the US, not the other way around, but I thought I'd throw that out there.)

False economy

Something to bear in mind:

Many who say we need to cut the deficit now are saying we need to because it's too big, and it's better to cut now than have to pay even more later.

Here's a thought though: the likely result of cuts is that the economy will weaken. Now, this immediately creates a problem in that fiscal revenues will drop, and so the deficit isn't going to drop by anything significant. Worse still, in practical terms, it'll become much more difficult to pay off, for the same reason that it's easier to pay a $100,000 mortgage if you have a $75,000/year job, than a $10,000 credit card debt if you don't.

But leave that aside from now. If the economy, as seems all but certain, contracts as a result of cuts in short term spending, what's the next step in terms of what government will do? Will it cut spending even more, with unemployment continuing to get worse?

No, eventually - whether that's in 2012, 2016, or 2020 - will realize it has to spend more to stimulate the economy. And because the economy will, by that point, be considerably worse than it is now, the size of the stimulus the government will inevitably have to provide will be much, much, larger than what it'd need to pay now.

Now if you want you can tell me "Squiggie, stimuli don't work, look at the last one" but frankly, aside from being wrong (we didn't, over-all, actually have a stimulus - the totality of government jobs actually decreased by HALF A MILLION during the last two years), the reality is that a larger stimulus, that's actually in line with what economists were calling for originally is inevitable if the economy doesn't improve. Do you really want to bet, with no serious efforts being made towards job creation in the current government, with likely lower incomes for the retired, government workers (those that remain), and the unemployed, that some how unemployment's going to make drastic drops any time soon?

Making cuts now doesn't make the deficit smaller, except in the very short term. In the medium term, cuts now will result in deficits that make this one look like my credit card bill.

Desperate and unusual measures

Rupert was not surprised to get the call. You didn't have to have fifty years as a Senior White House Correspondent to know that the government would be making an announcement the day before the debt limit crisis hit. The only question was what were they going to say? Did the two sides ultimately come to an agreement, or was Obama planning to use the fourteenth amendment as many had advocated. Rupert grabbed his coat, and hurried to the Metro station, and then, onwards to the White House.

There was a hush as The President, Senator Reid, Treasury secretary Timothy Geithner and Fed Chairman Ben Bernanke entered the room. The President stepped to the podium, looking grim.

"Good morning", said the President. "I'm going to make a brief statement concerning the negotiations over the debt limit."

The President looked around him, and bowed his head, reading the paper in front of him.

"Quite honestly, we're fucked."

There were gasps of horror across the room. Timothy Geithner stepped forward, and motioned at the President to move away.

"What the President means is... we're totally screwed. The entire economy is going to collapse at midnight tonight."

Bernanke nodded his head and stepped forward. "We're talking pretty much about an monetary apocalypse here. The US government is going to completely default on everything. I mean, I'll try to help, of course, but, well, I'm pretty much out of ideas. We have a liquidity trap, and, well, I can't do much now, pretty much by definition."

Rupert's shock did not prevent him from noticing what appeared to be a glimmer of a smirk from Bernanke. Why? What about this terrible announcement could Bernanke see as remotely funny?

...

Rupert fired off a report on his Blackberry, and then went home. He switched on the TV, and watched gloomily as the chaos began. The markets, which had been surprisingly high that morning, completely collapsed. The Dow was down 60%. The S&P 75%. Rupert expected the markets to close at any moment to contain the mayhem, but they stayed open, with stock after stock sliding into worthlessness. And, just after lunch, the markets stopped falling, there was a sudden spike, but everything was still down.

Rupert's Blackberry buzzed again. Another conference at the White House. Well, that was to be expected. Depressed, Rupert half intended to watch it on TV, but he grudgingly got up and went back to see what the President had to say.

Another hush as the The President, Senator Reid, Treasury secretary Timothy Geithner and Fed Chairman Ben Bernanke entered the room. This time the four were smiling. Had they found a way to prevent the crisis? Perhaps an agreement had been reached as the various sides saw the consequences of their actions?

The President stepped to the podium.

"Good afternoon", the President said. "I have a brief statement. Desperate times call for desperate, and unusual, measures. So this morning, before this morning's Press Conference, I instructed Timothy Geithner to invest what remained of our liquid funds into shorting the S&P. I'm pleased to announce that we now have all the money we need to completely pay off the deficit!"

Reid approached the podium, and, looking up, grinning, exclaimed: "Suck on that, Boner!"

"Bay-ner", said Obama, but Reid shook his head. "I'm sticking with "Boner"!" said Reid.

The four laughed, and left the room.

How it'll go down

(The Whitehouse lawn, 1st August 2011. The President walks out with John Boehner, Nancy Pelosi, Harry Reid, and Mitch McConnell, to a packed Press conference.)

The President: Good afternoon. I'm very pleased to announce that after many months of negotiations, we have finally hammered out a compromise and will be able to raise the debt ceiling. Mr Boehner?

Boehner (smirking): Oh yes, I'm very pleased that despite the usual partisan politics from the Democrats, they've agreed to accept our proposed compromise. In return for raising the debt ceiling until September, we are announcing an end to social security, with the remaining funds being given to anyone earning over 250,000 dollars a year. To help with, uh, job creation. Yes. And now, I believe my colleague Mrs Pelosi, would like to say something.

Pelosi steps up to the podium looking somewhat sheepish.
Uh.

Boehner: Say it! You agreed, remember?

The President: Oh don't make a fuss Nancy, just say it. We agreed.

Pelosi (sighs) Uh, ladies and gentlemen of the press. Uh (looks at Boehner) I am a poopypants. I poop my pants. Also I am a man. And I'm ugly and smell. Also I am a loser.

Boehner: Thank you Mrs Former Speaker. Now, Mr President.

The President: (apparently completely unfazed) Of course, Mr Speaker, ladies, gentlemen, of the press. My fellow Americans.  I, and my fellow Democrats, are stupid. And I am a socialist. And I want to take your guns. And I poop my pants. Poopy poopy, poopy, poopy.

Boehner: Thank you Mr President.

The President: Can I say one more thing?

Boehner: That depends on what it is.

(The two confer. Boehner nods his head and President Obama returns to the podium.)

The President: Mr Boehner is the greatest man who ever lived and it will be a privilege to welcome him to the Presidency in 2013. The only reason Joe and I don't resign right now is because the two term limit would deprive us of two years of President Boehner.

(Even Boehner looks surprised.)

Boehner: Thank you Mr President. Are there any questions? Yes, the bimbo from Fox News.

Bimbo: Thank you President Boehner. Do you feel that the compromise you have negotiated with the Democrats makes too many concessions to their far left agenda?

Boehner: Mr President, perhaps you can answer that.

Mr President: We are quite happy to renegotiate the agreement should Mr Boehner find any problems with it whatsoever.

Boehner: Thank you Mr President, and thank you all for coming.

Mr President: Our pleasure Mr Speaker!

The President walks back to the White House, smiling. "A good day", he thinks to himself, "Everything went exactly as I hoped. Exactly as I hoped."

The economy

We're screwed.

No, honestly, we are. We have two parties: one wants to destroy what remains of the welfare economy - social security, medicare, medicaid, programs to reduce unemployment, to build and rebuild critical infrastructure, turning the US government solely into a war machine, and we also have the Republicans who want the same thing but with no taxes.

I wish there was a groundswell of a movement for a third party right now, but I don't see that happening.

Some thoughts on the whole Murdoch/Hackergate thing

Here are some random thoughts in no particular order. They're generally based upon things I read and wanted to clarify.

1. It doesn't appear that there's hard evidence in the "NotW bugged 9/11 victims" scandal. That is to say, one newspaper, the Daily Mirror, apparently is the source for the allegations, but other newspapers haven't dug up anything to corroborate the allegation.
2. Even if she's entirely innocent, legally, I don't see how the person who was editor during the start of the NotW hacking campaign, and who headed the UK newspaper division of Murdoch's empire, could possibly have seen it as reasonable to not quit for as long as she did. Most executives would, at the very least, accept they had responsibility for the atmosphere that caused such acts to be committed, even if they, themselves, didn't know the specifics.
3. Despite claims to the contrary, there is no threat to Fox News from this scandal. The FCC might require that the Murdoch Empire divest itself of its broadcast stations and, possibly, its broadcast network, but the FCC doesn't really have the same kind of jurisdiction on cable channels, movie studios, newspapers, or any other aspect of Murdoch's corporation. Moreover, the Fox Network is essentially apolitical, it carries very little centralized Murdochian news or comment, with the exception of Fox News Sunday.
4. Despite the regulatory differences between the UK and US, and "something must be done" atmosphere in parliament, it's not entirely clear anyone in power can actually force a Murdoch exit from the UK media, with the exception of BSkyB, which has a similar legal status to Fox Network in the US.
5. BSkyB is a satellite network that includes a variety of different channels. Regulatory differences between the UK and US, and the lesser influence of Murdoch within the organization, means that those channels contain very little political commentary, and are largely entertainment oriented. 
6. The rumors are focusing on Murdoch exiting the UK newspaper market.
7. It is unclear to be how Murdoch would benefit by divesting himself of his UK newspapers.
8. Murdoch uses his UK newspapers the same way as he uses Fox News in the US, propagating a kind of right wing populist rhetoric to make money and buy influence.
9. Murdoch controls over 40% of the voting shares in News Corporation, despite only owning a much smaller fraction of the company itself. It is very, very, unlikely he'll be pushed out by investors. They'd have to be pretty much unanimous that he has to go. 
10. One of the two major parties in the US benefits immensely from Rupert Murdoch.

Conclusions? I'm not sure there are any yet. Murdoch's been dealt a bloody nose in the UK, and it's possible that regulators there will severely cripple his influence in that country if given the power to do so. But...

• I don't think Murdoch is going close/get rid of Fox News or The Sun
• I think there's sufficient plausible deniability for Murdoch to be able to shift the perceived blame on his subordinates, particularly Brookes.
• I think Murdoch may be forced out of BSkyB.
• If any effort is made to push Murdoch out of his UK newspaper holdings, I think the UK press will be concerned because of the precedent this sets, and as such I think such a move wouldn't go anywhere.
• I don't think any serious effort will be made to counter Murdoch's influence in the US.

That said, I wouldn't put money on any outcome right now.

Hopeless

So... in 2012 there are a couple of likely scenarios concerning the election. Obama will, apparently, be the Democratic nominee, unless he does the decent thing, recognizes he's incapable of doing of the right thing, and stands aside, which seems remarkably improbable as, well, it's the right thing.

So it'll be Obama vs... well, it might be Bachmann, though I'm inclined to assume Republicans realize they actually have a shot at this unless they make a massive error of judgment and appoint someone who is unelectably insane, but that's actually not a sure thing - Republicans put up, and won with, various governor candidates who fit that profile in 2010, so they may try the same thing.

The question for me is who's going to be worse? Obama will never do the right thing. Never. That's been proven time and time and time again since 2008. He was elected with as clear a mandate as anyone ever has to do the right things to fix the economy, to end unnecessary wars, to end the actions of an executive that was looking like it had more in common with Pinochet than it did with Kennedy. And he's galloped, wildly, in the other direction. Even his supposed liberal "successes" such as "health care reform", have involved sticking a progressive label on an anti-progressive policy.

So I find myself, actually, wondering if a moderate Republican might be a better bet this time, maybe coupled with as liberal a congress as possible. I can't tell what a Bachmann presidency would look like in practice, but I do find myself wondering if a Republican who isn't an eye swiveling loony might actually stand a chance of doing the right things... occasionally.

And that's actually hard to tell. I guess the issues that concern me most are:

1. Will the next President reject the deficit obsession of the pundits, and concentrate on getting the country back to work, given growth is, in reality, the only way we're going to fit the economy (and by the way, that'll fix the deficit too.) Will he or she recognize that the only economic system that has consistently worked since the 1940s has involved massive government spending at a time like this?
2. Will the next President recognize that war is, actually, bad, and work to end the obsession of the US government with solving every foreign issue by putting our troops at risk, and killing large numbers of innocent people?
3. Will the next President recognize that the "War on Terror" is ludicrous, terrorism is a combination of a criminal and political issue, that Al Qaeda is not a government but a group of extremists?
4. Will the next President recognize that our values are more important than our enemies, and that we become no better than our enemies when we jettison our values to "fight" them?

Realistically, assuming it's Obama vs {generic Republican} in 2012, I don't see much chance of either candidate having any of the right answers to any of those questions, before or after the election. The "Only Nixon could have gone to China" principle though suggests that if any candidate would, it would be the Republican.

The situation is hopeless.

2012

So, what exactly can Obama campaign on given he doesn't stand for anything, and has nothing to show for four years in office?

When people assume good ideas are bad

Once upon a time there was an economist called John Maynard Keynes. Keynes looked at the consequences of World War I, and the economic aftermath, and determined that things might possibly be bad. A decade and a half later, another crisis was engulfing the world, this time economic, and Keynes reasoned that the issue was that there was a lack of people buying things, and that this needed to be dealt with if the crisis was to be dealt with.

In the meantime, governments did what they always do, and prevaricated, going back and forth between constructive ideas and destructive ideas. The US government, for example, would spend money on public works in an attempt to revitalize the economy, and it would work. Then when unemployment started to fall, the government, concerned about the whole "People might think we're communists" crap, would cut back, and the economy would collapse again. This went on again and again, and was only broken after another war broke out, and the government was able - nay, required - to spend money like it was going out of fashion.

Keynes became a giant amongst economists after WW-II. He was proven right, again, and again, and again, about the links between unemployment, inflation, and fiscal policy, and governments began to seriously embrace Keynesian ideas concerning their own economies. But there was an asterisk to be put against the embracement. Keynes advocated massive government spending during bad times, and massive government saving during good times. But some governments used Keynes to justify spending at all times, and this caused an already skeptical group of economists to want to get away from Keynes, who was seen as encouraging too much government intervention in markets.

After much debate, most started to rally behind the ideas of Milton Friedman. Friedman adapted the Keynesian models, but addressed the underlying causes of poorly performing economies using what's arguably a similar but more generic set of concepts. Friedman argued that the cause of the great depression was a lack of money.

The amount of money in a modern economy is generally decided upon by a so-called central bank, a bank that acts as the manager of the country's currency. The bank has a number of tools available to it to allow it to expand the amount of money in the economy. It can, for example, adjust reserve rates, allowing banks to "lend" considerably more money than they "borrow" (from savers.) It can make loans of money cheaper, making it cheaper for banks to obtain more cash to put against their reserves.

When the Great Depression started a large number of banks collapsed because a lack of confidence in them caused numerous runs. The banks failed because they were unable to borrow enough to pay their savers. Friedman argued this was fundamentally the cause of the Great Depression, and that the Federal Reserve, the US's central bank, didn't do enough to increase the money supply to take care of the problem.

The arguments of Friedman and Keynes are often portrayed as polar opposites, but in reality they're similar, they just propose different groups of people as having the responsibilities involved. Both argue for an increase in the money supply, but Keynes proposes a "hard money" solution whereby the government borrows (or, preferably, spends savings) to inject more money into the economy via spending on commerce and business, while Friedman proposes a "soft money" solution where money is literally created to inject into the economy via banks.

Unmodified Keynesian economics was generally the default until the mid seventies. We have President Carter to thank for a switch over to Friedman's Monetarist economics in the US, and Margaret Thatcher for the switch to Monetarism in the UK. Both countries were suffering stagflation, which seemed to be caused by inflexible adherence to Keynesian economics. In particular, mainstream Keynesian opinion seemed to be that inflation and unemployment were negatively correlated. If measures were taken to deal with inflation (by tightening government spending), unemployment would likely rise, and if measures were taken to deal with unemployment, inflation may rise. Unfortunately, both countries were suffering both inflation and unemployment, and Keynesian economists were largely considered to be at a loss on how to deal with both happening at the same time.

OK, recap time.

• From the 1950s to the 1970s, Keynesian economics had been dominant
• The interventionist nature of Keynesian economics, and its use to justify heavily interventionist policies, made free market advocates eager to find alternatives, regardless of how effective Keynesian economics really were.
• During this 20-30 year period, one possible crisis was identified that most generally consider both unsolvable by classic Keynesian models, and caused by them, notably stagflation.

So, what happened here? Well, monetarism was tried, and it didn't work out as well as people hoped it would. The economies of both the UK and US significantly worsened, with unemployment rocketing. Indeed, this was by design - monetarists argued that if inflation was controlled, the other problems with the economy would eventually sort themselves out.

Growth in the US and UK slowed down. Both countries have had rates of growth since the 1980s that was positive, but nothing like as strong as the post war period that preceded it. And just to make matters worse, the Japanese had their own economic crisis after having what's considered the most healthy economy in the world. Upon collapse, the Japanese chose to let their Central Bank deal with the crisis, and only made minimal use of fiscal policies to deal with the issues, just like the Monetarists said they should.

The Japanese banks were suddenly awash with money, which they invested in countries whose economies were healthy, finding it almost impossible to lend money at home. Oops. Monetarism suddenly had its equivalent of stagflation, in this case a situation where unemployment remained high, while the Central Bank was running out of ways to inject more currency into the economy without devaluing it significantly in the process.

OK, recap time (2):

• Monetarism was tried, and appeared to have even worse problems than ordinary Keynesian economics. Keynesian economics at least took two or three decades to show any flaws, while Monetarism barely lasted half that time, and seemed to cause a lot of misery even when it was "working".
• Monetarism was clearly less effective than Keynesian economics at keeping an economy growing.

Now, here's where it gets interesting.

Recall the basic Keynesian principle: spend when your economy is having problems to get out of those problems, save when it isn't. It's not exactly rocket science, if you've ever taken out a student loan, you probably understand the concept.

Well, here's the problem. During the nineties, several things happened.

First, in the US, nobody wanted to admit that Monetarist economics were, well, just awful. And if they didn't want to admit that, they certainly didn't want to admit that Keynesian economics, flawed though it might be, was better, that it generally worked, and that Keynesian economists might have found ways to deal with the whole stagflation part. Why? Well, because Monetarism was a "free market" solution, at least in the sense that it didn't involve the government directly. Nice, free market, banks got to choose where to spend the money.

The second part was that the guy who came after Carter, Reagan, was an utter imbecile who decided to win elections by using a new lowest common denominator tactic - simply claim it was OK to reduce taxes. And it became gradually impossible for anyone to get elected who thought raising taxes was a good idea.

And so we got to the a state where by the early part of this century, US governments basically started to do things because they weren't Keynesian. Bush Jr, for example, used the fact the country was running a surplus as a reason to cut taxes. Keynesians would argue (and did) that given the economy was healthy (at that precise point) and the fact we had a large deficit, we should be keeping taxes where they are, using the surplus to pay off the deficit.

Do you know now where I'm going with this?

Keynes was never "discredited", any more than Isaac Newton was when Einstein said those fateful words "Wait a moment, I think there's more to it than that*". Keynesian economics turned out to be astonishingly effective, and one flaw in the classic Keynesian system shouldn't be used as a reason to switch permanently to a system that's clearly inferior. We've seen some absolutely awful economic policies since the abandonment of Keynesian economics within the US.

• The promotion of bubbles
• A refusal to pay off deficits when we can afford to do so
• A complete unwillingness to raise taxes when clearly they need to be raised.
• A refusal to spend when we clearly need to.
  

The doors to this path opened when Carter and Thatcher decided to try monetarism, the situation was made considerably worse when Reagan essentially promoted having your cake and eating it policies, and a lack of integrity in economics, and when nobody in power on this side of the Atlantic proved willing to admit that any of this was wrong.

We now have a government and establishment that:

• Probably knows that only government spending will fix the crisis
• Knows that monetarist solutions like lowering interest rates and quantitive easing can only go so far.
• But has decided the deficit is more important, like an idiot deciding they should put $5 towards their credit card debt rather than towards a bus ticket to a sure thing job interview.
• Are treating the deficit as a problem caused by overspending, rather than undersaving.
• Have so much invested in looking at the big deficit number, they've forgotten that the real problem with the economy is the lack of jobs. People with jobs can support themselves, and pay taxes towards paying things off.

Until our politicians accept the last thirty year's fiscal policies might have been utterly stupid, we can expect to have an economy that's just as bad as Japan's.



* OK, I don't think Einstein ever said that.