What if we wanted to borrow a bunch of money and no one would lend it to us? How would that affect the “stimulus” or bailout? The government would have to either raise taxes or print money, wouldn’t it? One leads to an extended recession and the other leads to the same thing plus inflation.
Asian investors won’t buy debt and mortgage-backed securities from Fannie Mae and Freddie Mac until they carry explicit U.S. guarantees, similar to those given on bonds issued by Bank of America Corp. or Citigroup Inc.
The risks are too great without a pledge that the U.S. will repay the debt no matter what, according to Hideo Shimomura, chief fund investor in Tokyo for Mitsubishi UFJ Asset Management Co., and other bondholders and analysts in Japan, China and South Korea interviewed by Bloomberg. Overseas resistance may hamper U.S. efforts to hold down home-loan rates and shore up the nation’s largest mortgage-finance companies.
This shows a real lack of confidence in foreign investors. If you want to view it this way, this is a de facto downgrading of the credit rating of the two FMs. And, as pointed out in the final sentence, this may trip up efforts to hold down interest rates for home owners. It certainly means trouble for the plan to refinance Freddie and Fanny and for the mortgage bailout plan.
And as the problem deepens, the effort to borrow money for the FMs will only get harder. My guess is that’s just a prelude to the same problems being encountered more broadly as the government tries to borrow the promised stimulus money. This is a very dangerous, and in my estimation, unnecessary road we’re traveling. The law of unintended consequences is setting up an ambush the likes of which we’ve never seen before.
That is how the headline should have been written.
However, Think Progress chose to characterize it this way: “Jindal Rejects $90 Million In Recovery Funding That Would Have Benefited 25,000 Louisiana Residents“. Says Think Progress:
Today, however, Louisiana Governor Bobby Jindal announced his intention to oppose changing state law to allow his Lousiana citizens to qualify for the second two unemployment provisions.
So why did Louisiana Governor Bobby Jindal do what he did? Well here’s what his office says in a press release:
The Governor said the state will not use a portion of the stimulus package that requires the state to change its law to expand unemployment insurance (UI) coverage to qualify for up to $32.8 million of the federal stimulus funding because it ultimately would result in a tax increase on Louisiana businesses.
Sounds like a governor who feels he and his legislature should be deciding their law and not the federal government.
Isn’t that what he’s elected to do? Doesn’t that sound like a perfect 10th amendment defense? Someone point out to me where the Constitution specifies that the federal government can reach down and, without debate or legislative or executive input, force a change of state law as a requirement to receive the aid.
Think Progress says:
But it is not clear why participating in the expanded unemployment insurance program would result in tax increases for business. By Jindal’s own estimate, the recovery package would have funded his state’s unemployment expansion for three years, at which point the state could — if it chose to do so — phase out the program.
Here’s a better idea – pull the requirement at a federal level. Why isn’t that the Think Progress position instead?
TP quotes a real expert in this area to close out the post:
As New Orleans Mayor Ray Nagin suggested earlier today, perhaps Jindal’s presidential ambitions are “clouding” his judgement. “I think he’s been tapped as the up-and-coming Republican to petition a run for president the next time it goes around. So he has a certain vernacular, and a certain way he needs to talk right now,” Nagin said.
Leave it to Mr. “Chocolate City” to see it that way instead of understanding Jindal’s position is the right position for his state. You have to wonder how Nagin would feel if Jindal told him the state would only pay for levee repair if he changed the law in New Orleans and did something the state required, even if it wasn’t in the city’s best interest?
We’d hear him hollering “no way” clear to Atlanta.
Osame bin Laden takes a verbal shellacking from one of the founders of al Qaeda who is none to pleased with bin Laden, Iraq and 9/11:
Sayyid Imam al-Sharif, who goes by the nom de guerre Dr Fadl, helped bin Laden create al-Qaeda and then led an Islamist insurgency in Egypt in the 1990s.
But in a book written from inside an Egyptian prison, he has launched a frontal attack on al-Qaeda’s ideology and the personal failings of bin Laden and particularly his Egyptian deputy, Ayman al-Zawahiri.
Twenty years ago, Dr Fadl became al-Qaeda’s intellectual figurehead with a crucial book setting out the rationale for global jihad against the West.
Today, however, he believes the murder of innocent people is both contrary to Islam and a strategic error. “Every drop of blood that was shed or is being shed in Afghanistan and Iraq is the responsibility of bin Laden and Zawahiri and their followers,” writes Dr Fadl.
The terrorist attacks on September 11 were both immoral and counterproductive, he writes. “Ramming America has become the shortest road to fame and leadership among the Arabs and Muslims. But what good is it if you destroy one of your enemy’s buildings, and he destroys one of your countries? What good is it if you kill one of his people, and he kills a thousand of yours?” asks Dr Fadl. “That, in short, is my evaluation of 9/11.”
Heh … welcome to reality Dr Fadl.
Oh, and an excellent if obvious evaluation.
You could hear jaws dropping all over the world’s human right’s establishment as Secretary of State Hillary Clinton stated the Obama administration’s new policy about human rights vs economic, environmental and security concerns:
Amnesty International and a pro-Tibet group voiced shock Friday after US Secretary of State Hillary Clinton vowed not to let human rights concerns hinder cooperation with China.
Paying her first visit to Asia as the top US diplomat, Clinton said the United States would continue to press China on long-standing US concerns over human rights such as its rule over Tibet.
“But our pressing on those issues can’t interfere on the global economic crisis, the global climate change crisis and the security crisis,” Clinton told reporters in Seoul just before leaving for Beijing.
Hmmm … 4th place.
“We should look at the vehicular miles program where people are actually clocked on the number of miles that they traveled.”
Why that would be Ray LaHood, the supposed Republican Secretary of Transportation.
“The policy of taxing motorists based on how many miles they have traveled is not and will not be Obama administration policy.”
Well if you guessed Barack Obama, you’re wrong. And if your second guess was Robert Gibbs, President Obama’s Press Secretary, you’re 0-2.
No, it was Lori Irving.
And who is Lori Irving?
Well she’s the department spokeswoman for Secretary Ray LaHood’s Transporation Department.
Which begs the question – who is running Transportation? Or, perhaps, for whom is Lori Irving really the spokeswoman?
And more importantly why is a Republican putting this idea forward in the first place, I mean if its true they’ve finally “found” themselves?
David Brooks does his usual NYT spin job:
Our moral and economic system is based on individual responsibility. It’s based on the idea that people have to live with the consequences of their decisions. This makes them more careful deciders. This means that society tends toward justice — people get what they deserve as much as possible
That’s the rumor. The reality, as we’ll see, doesn’t conform with the rumor. The why is in a single word: ‘justice’. What Brooks talks about here are the supposed foundations of our civilization and way of life. Individual responsibility and justice. Individuals are responsible for their condition (through their choices) and expected to live with them. Their condition isn’t anyone else’s fault or problem barring force or fraud. A just society understands that and, as is necessary, holds them responsible for their choices. Lessons are only learned when one has to live with the consequences of one’s choices. But what a just society doesn’t do is penalize those which have made the right or proper choices in their lives. It doesn’t require such people to prop up or rescue those who have made poor choices. Such a society would see that as “unjust” and work against the concept of individual choice and individual responsibility.
A just society is where everyone is afforded the same opportunities and held to the same standards of behavior and the law. Success, however, is left up to individual effort and ability. In a just society you are free to do, within reason, whatever you desire to do, but you’re expected to live with the consequences.
With that preface, let’s look at Brooks’ next couple of paragraphs:
Over the last few months, we’ve made a hash of all that. The Bush and Obama administrations have compensated foolishness and irresponsibility. The financial bailouts reward bankers who took insane risks. The auto bailouts subsidize companies and unions that made self-indulgent decisions a few decades ago that drove their industry into the ground.
The stimulus package handed tens of billions of dollars to states that spent profligately during the prosperity years. The Obama housing plan will force people who bought sensible homes to subsidize the mortgages of people who bought houses they could not afford. It will almost certainly force people who were honest on their loan forms to subsidize people who were dishonest on theirs.
While Brooks properly chastises the banks, automakers and state governments, he leaves out one of the most irresponsible of entities which played as large a role as any other contributor to this current financial debacle – the federal government. If ever there was an enabler for all of this, it is Washington DC. Much of what happened can be laid directly at the feet of the Fed. The financial implosion didn’t start on Wall Street but with the insolvency of the quasi-governmental entities Freddie Mac and Fannie Mae. Yet they’ve not been in the spotlight of Congressional hearings or had the millions paid their top execs complained about and capped. Where’s the justice in that?
So to get back on topic after that brief aside to assail writers like Brooks for excusing the Federal government from their condemnations (and you’ll see why he did so in a moment), the reason that Brooks seems so angry in this part of his op-ed is he is giving lip service to some foundational American ideals and pretending to be outraged that they’re being violated just before he pulls the rug out from under them. It is obvious to Brooks and anyone with the IQ of a melon that those who are running the show in DC have absolutely no desire for a “just” society based on individual responsibility anymore but he wants to break it to you gently. That’s the old America. The new America is one based in “fairness” and collective responsibility. At this point, Brooks wants you believing he’s an “old America” kind of guy.
So he relates the fact that many in America are still mired in their old fashioned belief in justice and are, consequently, a little ticked about this payoff to the irresponsible among us. People are complaining about it. And after a reasonably good, but disingenuous start, it is here where Brooks pulls the mask off completely:
These injustices are stoking anger across the country, lustily expressed by Rick Santelli on CNBC Thursday morning. “The government is promoting bad behavior!” Santelli cried as Chicago traders cheered him on. “The president … should put up a Web site … to have people vote … to see if they want to subsidize losers’ mortgages!”
Well, in some cases we probably do. That’s because government isn’t fundamentally in the Last Judgment business, making sure everybody serves penance for their sins. In times like these, government is fundamentally in the business of stabilizing the economic system as a whole.
Irresponsibility is not really penalized in New America. New America is driven by the belief that it is our collective responsiblity to those in need, regardless of how they got there or what it entails, to satisfy that need. So when the life vest of your money (via taxes and debt you will be taxed to repay) is offered to someone drowning as a result of their own irresponsible choices, you are expected to accept that as your duty and not complain about it.
You see, per Brooks, government isn’t in the justice business, it’s in the “economic stabilization” business.
Really? Since when?
And since when did the economic stabilization business involve rewarding incompetence and irresponsibility while punishing their opposites? Isn’t such a policy of rewarding incompetence and irresponsibility a huge moral hazard, not to mention self-defeating? Why would someone change their behavior if there is no real punishment for their present behavior? Isn’t government picking “winners” and “losers” even while Brooks claims government isn’t in the “Last Judgment” business?
In fact it is and has been in the “Last Judgment” business for a while. And in the case here, the judgment made by government is that it is only fair to pick up those who’ve fallen short at the expense of those who haven’t. It has made the judgment that their need is far greater than the need of those who have played by the rules and done their part – after all those who have done the right thing are relatively better off than those who haven’t aren’t they? If, as Obama claimed at the Greek Temple, “we are our brother’s keepers” (well except in a real, Obama-family sense), then the “last judgment” was made then and is now merely being implemented.
We are, apparently, no longer a nation which seeks justice and equal opportunity. That’s Old America. New America seeks fairness as its highest goal. And in the New America, that means an equality of outcome where new “rights” are invented which entitle us to our desires, even at the expense of others.
Brooks goes on to apologize and attempts to minimize the horrific damage being done to America as we used to know it. He serves his purpose and spins the utter destruction of Old America and the emergence of New America as something which just had to be done by our new leader and his benevolent band of brothers, all of whom have your best interest at heart.
It’s enough to make you sick.
Apparently signs equal threats to some of our police:
An Oklahoma City police officer wrongly pulled over a man last week and confiscated an anti-President Barack Obama sign the man had on his vehicle.
The officer misinterpreted the sign as threatening, said Capt. Steve McCool, of the Oklahoma City Police Department, and took the sign, which read “Abort Obama, not the unborn.”
Chip Harrison said he was driving to work when a police car followed him for several miles and then signaled for him to pull over.
”I pulled over, knowing I hadn’t done anything wrong,” Harrison said in a recent phone interview.
When the officer asked Harrison if he knew why he had been pulled over, Harrison said he did not.
”They said, ‘It’s because of the sign in your window,’” Harrison said.
When did cops start pulling people over for political bumper stickers or signs?
Anyway, Harrison tried to explain what the sign meant, they disagreed and he was issued a a slip of paper that said he was a part of some sort of investigation. They took his sign. Later, he’s contacted by the police saying the policeman misunderstood and asking him if he wanted his sign back. They had contacted the Secret Service about the sign, and they had told the police it wasn’t a threat. Except apparently they were blowing smoke:
”The Secret Service called and said they were at my house,” Harrison said.
”When I was on my way there, the Secret Service called me and said they weren’t going to ransack my house or anything … they just wanted to (walk through the house) and make sure I wasn’t a part of any hate groups.”
Harrison said he invited the Secret Service agents into the house and they were “very cordial.”
”We walked through the house and my wife and 2-year-old were in the house,” Harrison said.
He said they interviewed him for about 30 minutes and then left, not finding any evidence Harrison was a threat to the president.
Walk through my house? Uh, get a warrant.
Hate groups? They knew what the sign was about, what was the rest of this about?
Which segues nicely into the next portion of the post – hate speech.
Eugene Volokh has a very interesting post up about a UCLA Chicano Studies Research Center study titled Hate Speech on Commercial Talk Radio.
It’s a fascinating post which demonstrates how hard certain groups are working another angle aimed at talk-radio (and read the comments, where commenters take the study’s assertions aparat). Hate-speech is a lever that various groups on the left have been trying to enable for years. From the study, here’s their definition of hate speech:
Types of Hate Speech
We identified four types of speech that, through negative statements, create a climate of hate and prejudice: (1) false facts [including “simple falsehoods, exaggerated statements, or decontextualized facts [that] rendered the statements misleading”], (2) flawed argumentation, (3) divisive language, and (4) dehumanizing metaphors (table 1).
Then the examples:
Table 1. Analysis of Hate Speech from The John & Ken Show
“And this is all under the Gavin Newsom administration and the Gavin Newsom policy in San Francisco of letting underage illegal alien criminals loose” (from the July 21, 2008, broadcast).
Vulnerable group: foreign nationals (undocumented people).
Social institutions: policy and political organizations (city policy and mayor’s office).
The sanctuary policy preceded Gavin Newsom’s tenure as San Francisco’s mayor, and neither Newsom nor the sanctuary policy supports “letting underage illegal alien criminals loose.”
Guilt by association is used to make the hosts’ point. Undocumented youth and those who are perceived as their endorsers at the institutional level are stigmatized by being associated with criminality.
Criminalized undocumented youth and their perceived validators (Gavin Newsom and the sanctuary policy) are depicted as a threat to San Francisco citizens, setting up an “us versus them” opposition.
ANALYSIS The language depicts the hosts’ targets (undocumented people, city policy, and Mayor Gavin Newsom) as dangerous, criminal, and collusive. In addition, the focus of that policy (undocumented people) becomes reduced to “underage illegal alien criminals.”
Talk about over-analysis. The bottom line is this matrix of assessment is based in pure biased opinion disguised as objectivity. Hate speech, in this case, is nothing more than saying “letting underage illegal alien criminals loose” is wrong.
As Volokh says:
The vagueness and potential breadth of the phrase “hate speech” is a pretty substantial reason — though just one among many — to resist the calls for a “hate speech” exception to the First Amendment. And the vagueness and potential breadth is also a reason to be skeptical of uses of the phrase even outside the law: It’s very easy to define “hate speech” as you like (or leave it undefined, as some arguments do), and use it to condemn people who express a wide range of views that you disapprove of.
One of the most defining phrases in the history of America free speech is “I may not agree with what you say, but I will defend to the death your right to say it.”
It has never been “I don’t like what you say and it sounds like “hate speech” to me so you should be silenced”.
It seems like everyday more and more is discovered that affects the climate and it is clear those touting the “science” of AGW being settled were clueless about it. For instance:
Whether devastating faults, dank caves or mud cracks on a drying desert plain, Earth’s surface is riddled with fractures.
Now a new study had found that the cracks exhale large quantities of gas, perhaps enough to affect global warming.
Now, I’m not saying this overturns their arguments, but one thing I can say without contradiction is this isn’t modeled in their climate models. And, while at this point there is still not enough information to determine if it is indeed enough to affect global warming, its obvious the AGW crowd didn’t even know this problem existed.
Here’s what scientists found:
Noam Weisbrod of Ben Gurion University of the Negev and a team of researchers monitored a crack about 2 meters long (6.5 feet) and 1 meter (3.3 feet) deep for two years in the Negev Desert is Israel. Each night, they watched as warm air in the crack drew water vapor out of the surrounding rock, and lifted it into the cold evening air.
If air in the crack is just 7 degrees warmer than the ambient temperature, it is buoyant enough to rise out of any crack in the ground bigger than 1 centimeter (0.4 inch) across, bringing with it any gases that leak out of the surrounding soil or rock.
But the team was surprised to find that the crack they studied gave off water vapor up to 200 times faster than areas without fractures.
The next time one of the AGW crowd tries the “settled science” canard, remind them of this little beauty and ask them how it affects the theory. I hope you enjoy the sound of crickets chirping.
As you recall, the following is partially blamed for getting us into the current housing crisis:
Ever since the credit crisis began, a lot of blame has been heaped on adjustable-rate mortgages, home loans that recalibrate according to market fluctuations. One brand of these innovative mortgages that have come under special criticism has been so-called “exploding A.R.M.’s” that lured borrowers with unusually low teaser rates that then reset skyward a few years later. These have often been derided as predatory, and lenders who offered them accused of luring homeowners into buying homes they couldn’t afford for the long-term.
So is the Obama administration, with its $75 billion mortgage bailout, any better than those previous lenders who were described as “predatory”? Well not according to the plan he’s put forward:
Critics of these might want to check out the Homeowner Stabilization Plan put forward by the Obama administration today. The plan would reduce mortgage payments and interest rates for homeowners who have seen their payments rise to more than 38% of their monthly income. But those reductions last just five years, after which they begin to reset to higher rates. In short, Obama is just drawing out the teaser rates a bit longer.
During the next five years, the Stabilization Plan will encourage lenders to lower loan payment below 38% of the owners’ income and provide subsidies for banks that lower the payments to 31%. The actual rate of payment will be even lower, since the government will also pay homeowners with the reduced rates $1000 a year to stay current on their payments.
After five years however, those government sponsored adjustable-rate mortgages will reset. The Obama adminstration promises they will reset at a moderate phased in level. But the loss of both the subsidy and the $1000 payment will automatically make the monthly payments much more expensive. What’s more, many market watchers expect interest rates will be much higher five years from now, putting additional pressure on mortgage rates. We could, in short, simply be prolonging the housing crisis.
Nothing like kicking the can down the road 5 years is there? The hope, obviously, is that Obama is safely in his second term when this new crisis hits, and, of course, by then he can safely denounce those who default on their mortgages again as people who were given a chance but didn’t take advantage of it.
Now obviously the people who get this “help” can sell their homes in that 5 years (and, of course, that was the idea when many of these people took out the low adjustable rate loans previously – a quick flip. But the market tanked.). However, it will be a buyer’s market in the coming years. So there’s a very good chance that in 5 years we’re going to see the very same problem we have now resurface.
So what are we doing with this 75 billion?
More pain avoidance which, it appears, will simply prolong the problem.
It seems that college students have entirely different expectations than do college professors. Or at least some college professors. Apparently the students see it like this:
“I think putting in a lot of effort should merit a high grade,” Mr. Greenwood said. “What else is there really than the effort that you put in?”
“If you put in all the effort you have and get a C, what is the point?” he added. “If someone goes to every class and reads every chapter in the book and does everything the teacher asks of them and more, then they should be getting an A like their effort deserves. If your maximum effort can only be average in a teacher’s mind, then something is wrong.”
Sarah Kinn, a junior English major at the University of Vermont, agreed, saying, “I feel that if I do all of the readings and attend class regularly that I should be able to achieve a grade of at least a B.”
Essentially the argument is, show up, do the minimum (i.e. all you are asked to do) and you should get an “A”, or at least a “B”.
Merit? Above and beyond the “average” or the “expected”? They don’t seem to enter into their thinking at all.
Yes, as the professors properly identified the problem, it is a false sense of entitlement.
So, now that the problem has been identified, can you pinpoint the source? Well the profs have various views about that.
Professor Greenberger said that the sense of entitlement could be related to increased parental pressure, competition among peers and family members and a heightened sense of achievement anxiety.
Uh, no, but nice try, professor.
Aaron M. Brower, the vice provost for teaching and learning at the University of Wisconsin-Madison, offered another theory.
“I think that it stems from their K-12 experiences,” Professor Brower said. “They have become ultra-efficient in test preparation. And this hyper-efficiency has led them to look for a magic formula to get high scores.”
James Hogge, associate dean of the Peabody School of Education at Vanderbilt University, said: “Students often confuse the level of effort with the quality of work. There is a mentality in students that ‘if I work hard, I deserve a high grade.’ “
Oh, oh, oh … so damn close. Where do they get that screwy idea that “level of effort equals quality work”, Dean Hogge? I mean it has to come from somewhere, and apparently it is widespread enough that it is a fairly pervasive phenomenon? Any guesses?
Well, in a nut shell, false entitlement often flows from false self-esteem. Yes, friends, I’m back on that. When little Johnny gets a trophy and a party for being on a 12th place Pee-Wee Baseball team – the very same reward the first place team gets – why in the world wouldn’t he correlate “effort” with “result”? In his case his effort landed him the same rewards as the first place team. So 12th is just as much an “A” as 1st to him, isn’t it? And he gave his all to end up in 12th, so that just has to be good enough, right? Multiply that over a 18 year life time and it isn’t difficult to understand where this sense of entitlement comes from, is it?
When you’re rewarded at the same level as the real achievers throughout life – so you won’t feel like the loser you are and learn from that – two things happen: One, you don’t try to do better because there’s no incentive to do so and two, you feel entitled to the same results as those who actually did achieve something. So it certainly isn’t far fetched for someone to then believe that effort equals achievement and thus entitlement to the best rewards.
Heh … then you finally leave “soft America” and meet “hard America” as Michael Barone calls it. Suddenly reality slaps you in the face, calls you a loser and gives you the “C” you deserve for just doing the expected. The “average”. The same thing you’ve always done and been rewarded with more.
Your world is shattered. You either figure out how big a disservice those who cheered your stunningly average performance up till then have done you and do something positive about it or you wail and whine about how “unfair” you’re being treated and eventually drop out.
In reality, just like our economic remedy, it’s just another example of pain avoidance – something it seems the American public is addicted too these days. The pain avoidance that characterizes the building of false self-esteem can be crippling to a child because the child is given the wrong signals about their abilities and what reality and life expect of them throughout their early formative years. It’s a loser’s way of avoiding reality, except it isn’t the kid doing it to themselves – it’s usually the parents and other enablers who too are in the pain avoidance business.
But the one inescapable truth in this whole process , however, is the fact that reality always finds a way to get through the puny defenses that have been erected and eventually has its way. It’s a pity that many students first discover that in college and many don’t survive the discovery. Had their parents just done their job as parents instead of trying to manage and avoid pain, the kids might be prepared to confront the reality of “hard America” and give it their best instead of being blindsided by it and crushed.
But of course, that smacks of common sense and as our experts are constantly telling us they know much more how our children should be raised than we do. And trust me, given the results, that claim has little to do with common sense.
UPDATE: If you don’t believe this translates into a real world problem all you have to do is listen to Bill Press – or not, as, apparently, most people choose. Here he is in an interview describing why he wants government to ensure his reward via the Fairness Doctrine:
‘I know why I’m interested in it because I get up every morning at 3:45, I do three hours of talk radio every day from six to nine, that’s my life, it’s my business, I want to make money at it, and I want to be heard.
Translation: I make the effort and thus I should have the same rewards (listenership, influence and monetary) as Rush Limbaugh.