September 2008
Should we blame Clinton for the subprime mess?
No.
Well, if we’re wearing those red-tinted glasses that screens out everything except what would make the GOP happy, we might—but even then it’s a stretch. Did the President do something eight years ago that set us on the track of crisis? Sure—every President does that with every major decision made. Theoretically one of his successors would be competent enough to catch...
“McCain spokesman Tucker Bounds suggested the fact the Obama thought the measure...”
– CNN Political Ticker
This is an awkward argument for Tucker Bounds to make. It boils down to, “Obama should not be President because he overestimated McCain’s ability to bring the support McCain had promised to bring. Believing McCain will actually do anything he says he will is naive...
Predatory lending
During this whole subprime mess, I’ve seen a lot of people writing that loosening of credit standards allowed people to essentially get a larger mortgage than they were able to handle. This is, in part, true—but doesn’t capture the whole picture. Many of the loans now being foreclosed upon involve more factors than people poorly judging how much they could pay each month.
Many...
Leadership, finger-pointing, and the bailout
Both Obama and McCain had a hand in crafting the bailout bill. Both parties have reason to dislike it—and nobody thinks its better than a necessary evil. And now both sides are blaming the other for the bill’s failure.
The Democrats have a pretty convincing case. The Democratic leadership and the Republican leadership each promised to deliver over half of their parties. The Democrats...
Bailout rejected →
Whoa.
The gambling man
McCain is a craps man. He likes the dice and the spectacle. He has some pretty serious ties to the casino industry—but I don’t wholly fault him for it. Senators who really like hunting are likely to have ties to the gun lobby. McCain likes his casinos. Unfortunately, this addiction to risk goes past recreational gambling and permeates important decisions.
We’ve seen a couple...
Whose fault is the crisis?
The short answer is that there is enough blame to go around. Some would say the government propped up institutions long after they should have been allowed to fail. Others would blame the private market, which encouraged high-risks for personal gain at the expense of the company or the country. There is room for pretty much everybody to be partially right. The interaction of a lot of different...
The first debate
McCain looked a lot better than I expected. Of course, the things he said were a little bit crazy. He criticized Obama for calling for “restraint from both sides” in the Georgia/Russia conflict. I wouldn’t think that would be a controversial statement. I mean, it’s good to back up our ally, but our ally was acting crazy. So who “won” the debate depends on how...
On Palin and Words
COURIC: Why isn’t it better, Governor Palin, to spend $700 billion helping middle-class families struggling with health care, housing, gas and groceries? ... Instead of helping these big financial institutions that played a role in creating this mess?
PALIN: Ultimately, what the bailout does is help those who are concerned about the health care reform that is needed to help shore up the economy– Oh, it’s got to be about job creation too. So health care reform and reducing taxes and reining in spending has got to accompany tax reductions.
JohnBrissenden: The Governor appears to suffer from what we doctors call Magnetic Poetry Speech Syndrome.
Obama and the bailout
Unlike McCain, Obama really is qualified to deal with something like this. He does a better job than all but about two people in the country navigating the space between neoclassical economics (what should, theoretically work if people behave rationally) and behavioral economics (which takes into account how people actually behave). The two other people are both working for Obama now. As the...
“It’s very important when you consider even national-security issues with Russia....”
– Sarah Palin, clarifying her much mocked comments that her foreign policy credentials are bolstered by Alaska’s proximity to Russia. This should put that issue to rest.
My plan for Afghanistan
John McCain has shown us the path for Afghanistan. We’ve got problems with Iraq and the economy, and we don’t really have time to focus on Afghanistan. Let’s just suspend all our operations there. We can issue a statement and tell the Taliban that we need to focus on the economy for a while and that they should honor this time-out. It’s not that we don’t think...
“It’s not clear what exactly McCain is going to do in Washington. He...”
– John Dickerson - Slate Magazine
I’ll probably have more detailed thoughts on this whole situation tomorrow—but for now, I’m having a heck of a time sorting out what McCain is doing. Did he miss the whole emerging narrative about how he’s too reckless to be that close to The...
“McCain supporter Sen. Lindsey Graham tells CNN the McCain campaign is proposing...”
– CNN Political Ticker
McCain, this is disgusting. You are seriously saying that unless you get your way on some legislation you are going to boycott the Presidential debate? Isn’t the whole point of discussing a bailout plan that it’s a democratic process with, you know, voting and...
McCain wants to delay the first Presidential... →
McCain is acting all mavericky again. Take that Commission on Presidential Debates!
Re: My faith in capitalism is shaken
Jeff Miller has offered a list of partial responses on why national accumulation of wealth could be beneficial. Here are my reactions to a few of them. (I should emphasize that I proposed the elimination of poverty as a higher goal than the maximization of wealth. This is not an equivalent goal to the complete imposition of resource equality.)
Population is growing, and you’d like wealth to stay...
Conclusions on the Dodd Bill
I can support Chris Dodd’s proposed bailout bill. It does a few things I like.
It offers sufficient oversight to the program without allowing it to become tangled in red tape.
It gives the FDIC authority to decide when modifying an acquired mortgage would be a better option than foreclosure with the joint goals of protecting taxpayer’s investments and keeping people in their homes.
...
The Dodd bailout bill
I’m reading it. So far it looks like a really, really good bill. I even borrowed an economist to explain the bill to me. One of my favorite parts is that the government gets an equity share in the bailed out corporation of 125% of the loss it took on selling troubled assets. Thus, if the assets are fairly priced, the treasury doesn’t lose anything. This give the companies an...
My faith in capitalism is shaken
So, I talked to an actual economist. It turns out some of the things I had assumed were good ideas might not actually be good ideas. For example, I assumed the accumulation of wealth was a good idea. It turns out the studies don’t back this one up. Specifically, having a sufficient amount of money will make people happier, but beyond a relatively minimal amount, additional increases seem to...
“This crisis should put an end to false debates about government versus markets....”
– Fareed Zakaria, Big Government to the Rescue | Newsweek.com
“Twenty years have passed since this Court declared that the death penalty must...”
– Justice Harry Blackmun, 1994.
The U.S. Supreme Court has issued a stay of execution for Troy Davis, two hours before he was scheduled to die.
(via bunnynico)
The Corporate Good Citizen
Jeff Miller wrote an explanation for why corporations should keep charitable donations to a minimum. Here is part of it:
When companies are doing well, [charitable donations] like this seems all well and good, but if you’re a shareholder or employee or creditor of Lehman today, it seems downright irresponsible. A company’s value ought not be dribbled away to make executives look good or feel...
Let's do this bailout differently.
Here is a quick run down of the economic crisis. None of these points should be too controversial:
Wall Street is on fire. (Not literally. Unfortunately. This crisis makes rebuilding the entirety of Wall Street look like a cakewalk.)
The proposed bailout of $700,000,000,000 is a lot of money, even for the government. That ‘s about $2,000 per taxpayer.
The current proposal asks for no...
“In any case, McCain’s smear — that Cox “betrayed the...”
– George Will
Hate crimes and hate speech
Responding to a thread about hate crimes, sds wrote:
I agree it’s not a matter of free speech, per se. But I want the law to judge my actions or my intent to commit actions, not necessarily the reasons behind them. I think a murder based on gambling losses and a murder based on hating a homosexual should carry the same weight of punishment. We cannot legislate against thought. I don’t want a...
Hating Sarah Palin →
Sarah Palin has excited a serious level of anger from both the left and the center. The McCain campaign has all but called it a vast left-wing conspiracy. As I wrote in the longer piece beyond the link, that’s not what’s going on. The same divisive rhetoric that excites the right is also targeted to upset the left.
Some Political Notes from Mills →
Mills, who doesn’t often weigh in on political issues, wrote about Heart’s rather crude letter regarding John McCain and Sorkin and Dowd’s advice that Obama should get more angry. He’s spot on on both and I recommend reading the post.
A correction on the bailout
Reactorboy has pointed out that I mangled my earlier post on the bailout. The correct amount of the bailout is not $700,000,000.00 as I had written but $700,000,000,000.00. I can only blame carelessness and the bleary thing my eyes do when they see a number that large. I probably should have written it out as “seven hundred billion” to save space. Alternatively, I could have written .7...
I gotta give Sarah Palin some credit
sisterpearl:
because the woman has single-handedly succeeded where so many others have failed. She — on her own, by the force of her personality, her record, her potential — has convinced me to do what even my own family, friends and colleagues, not to mention countless politicians, bloggers, and analysts, months of campaigning, debating, and stumping, could not convince me to do.
Sarah Palin...
Is the proposed bailout a good idea?
No.
$700,000,000,000 is roughly the cost of the Iraq war. It is also enough money for universal health care. I mean that $700,000,000,000 if invested with a moderate return would be enough to insure all the uninsured people in the country. Forever.
Of course, if the entire world economy collapses, safety nets and all, we might have bigger problems than a lack of health insurance. So even an...
An Electoral College Tie?
If every state votes the way it is currently polling, Obama will win narrowly. In this case, Obama gets all the Gore states plus New Hampshire and Colorado. But if a few states switch, it’s possible there will actually be a tie. McCain could win New Hampshire. Obama could win Nevada but lose Colorado. Obama could win Virginia but lose Michigan.
What happens then? Well, we have a mess. It...
Money and Utility (cont'd)
In my previous post about how money becomes less useful as you get more of it, I realized I left out three things.
To be academically thorough, the utility of money tapers off the bottom as well as the top. If you are making less than subsistence wages, it doesn’t much matter how much less you are making—you still won’t subsist. This leads to the bizzarre situation where...
Money vs. Utility
A lot of otherwise sound economic reasoning gets derailed by using the wrong metric. Rather than looking at where the dollars are, we should be intereste in the benefit derived from those dollars. Afterall, the dollars are attractive enough as currency—but we’re more interested in them because they’re useful. But money and utility are not linearly related. In other words, twice...
“It would be really nice for us to win Florida. I’ll tell you, we can win this...”
– Obama
This is a pretty good charactarization of Florida’s dual role for Obama in this election. The most probable path to the Presidency for Obama does not require Flordia. McCain, on the other hand, is in all sorts of trouble if he loses Florida. (He would probably need both Michigan and...
Apparently CNN’s story, “Obama pitches himself to women” is neither about crowd surfing nor about the maenads. Disappointed.
“In a crisis, voters want steady, calm leadership, not easy, misleading answers...”
– McCain’s Scapegoat - WSJ.com
It looks like the Wall Street Journal doesn’t have a lot of respect for McCain’s economic knowledge.
Incompetent Monopolies
jeffmiller disagrees with one of my previous posts explaining that the difference between government and industry is that government is, by definition, a monopoly and can support its own incompetence through taxes.
[W]hen businesses are incompetent, they can’t coerce you to accept the incompetence.
As usual, my criticism of free-market libertarianism is that it expects reality to adhere...
An unfair Obama ad?
I earlier promised to post here if Obama’s campaign ever ran an advertisement as nasty and misleading as some of those McCain has been running. There is a candidate. It’s a Spanish language ad that accuses McCain of being two-faced on immigration. It mentions McCain “and his Republican friends.” It also somewhat unfairly quotes Rush Limbaugh out of context.
I’m torn...
Bank failure and cooties
It’s been a rough week for our finance system—and a lot of people want to blame the government. When something this large has problems this big, the government is usually a fairly safe culprit. Close ties to the government allowed some of these companies to get into more trouble than they could have in a pure capitalist system. Alternatively, the government, which should have jumped on...
“Sarah Palin likes to tell voters around the country about how she “put the...”
– CNN Political Ticker: All politics, all the time Blog Archive - Palin’s transparency proposal already exists in D.C. « - Blogs from CNN.com
Poor McCain campaign, it just can’t catch a break.
Sarah Palin's two email addresses
I've seen a lot of people who seem to assume that Palin's use of a Yahoo address for government business makes her some sort of criminal. This is my bid to inject a bit of actual information into this bizarre dialog.
Q: Is it against the law to use a personal email address for state purposes?
A: No. At least, it's not against any law I know of. There could be some bizarre Alaskan law about doing government business through government websites--but I'm a little confused as to what the point of the law would be.
Q: Wouldn't this circumvent the Freedom of Information Act?
A: The goal of the Freedom of Information Act (and the state equivalents) is to allow access to all (or most) government records. It is very broad in how this is defined. Using a private email address would not circumvent it.
Q: Then why are people talking about this?
A; Beats me.
Q: No, seriously, what's the kernel of truth behind all this whispering?
A: Mixing government and private messages is bad policy. It does muddy the waters between government business and personal business. By all accounts, they're already incredibly muddy in a Palin administration--and combining personal and government emails makes it very difficult to sift together what is what. Keeping the addresses separate makes good sense because you can say that these things are private and these others are not.
Q: Could this indicate that Palin was deliberately trying to get around FOIA requests?
A: It would suggest something like that--which would be bad. But using separate email addresses is not in itself illegal.
Copyright, fair use, and government leaks
The recent hacking of Sarah Palin’s email address raises an interesting copyright question. Suppose whomever hacked into these emails sent copies of them to a bunch of bloggers that had been critical of Palin. One of these bloggers decides that the world has a right to know about everything contained in these emails (a dubious proposition) and posts all of them on his blog. Can Palin sue for...
“The Secret Service contacted the Associated Press yesterday and asked for copies...”
– Hackers leak e-mails from Palin account - The Boston Globe
This paragraph makes me feel less safe. Isn’t the Secret Service supposed to be competent? Did they really ask the AP for copies of leaked e-mails that were circulating widely on the Internet?
Secondly, I don’t really have much...
Future Polls
Since the polls mixed and have fluctuated wildly over the past few weeks, I’ve been trying to get a sense of which direction things are heading. This isn’t an impossible task because political information permeates the public very gradually—so if you can learn things quickly you could, theoretically, guess which stories would last and how people will react to them. The latest...
