Free Markets, Free People

Dale Franks


Things That Need To Be Said…Unofficially

Sometimes, a message has to get out there, so that the people who need to hear it can hear it.  Often, however, the message can’t be gotten out by presidents, finance ministers, or Fed officials.  But, someone has to make the arguments.  Samizdata’s Brian Micklethwait takes up the task today.

It needs to be said that under certain circumstances easily now imaginable, many Western citizens would argue, strongly and vocally, that those idiot foreigners who are now lending money to Western governments should in due course be told: sorry sunshine, you ain’t ever going to get it back. Our governments are bankrupt. Why the hell should we and our descendants in perpetuity be paying tribute to you? You knew that the money to pay you back would have to be stolen from us. You assumed we’d just cough up indefinitely. Well, we damn well won’t. You are now a definite part of our problem, and telling you to take a hike is going to be part of our solution. Our thieving class is now “borrowing” money from your thieving class like there is no tomorrow, and we are not responsible for the actions of either gang. A plague on both your houses.

We want you foreign thieves to stop lending to our thieves, now. And the best way for us to convince you that you should indeed stop lending, is to tell you that you are extremely liable never to see most of your money back.

Which has the added virtue of probably, approximately, being true, already.

We probably won't be able to borrow money from these guys for much longer...

We probably won't be able to borrow money from these guys for much longer...

The last sentence is the real kicker, because it’s beginning to look more like a question of when, rather than if.  And, who of course.  Of the Western nations, my favored picks, in no particular order, for winning 1st place in the 21st Century Debt repudiation race are, in no particular order:  Hungary, Italy, Ireland, Spain, and Portugal.

Second place will be too close to call.

And you don’t have to couch it in Mr. Micklethwait’s incendiary libertarian rhetoric about their thieves and our thieves.  I mean, I agree with it, but the plain fact is that even if you grant that everyone has the best intentions in the world, it still seems that we are very close to a tipping point where it could begin to happen.  Bruce wrote about it earlier today.

If one of the Euro Zone nations decide to revert to Lira or Escudos, or whatever, the news that such a deal is in the offing will not only hammer the nation that tries, but anyone else who looks iffy, and, untimately, the Euro itself.

Investors are not going to sit around and wait to have their Euro-denominated paper revalued in Drachma.  They’ll immediately start dumping that paper, and moving all the assets they can out of not only the offending nation, but any other country that looks like a weak sister.  As the article Bruce quoted notes, “Such a wholesale shift would lead to a collapse in the money supply…”  Gee, you think?

Germany, of course, would probably get the lion’s share of that new money, and to avoid a general economic collapse, they’d probably have to dump the Euro, too, and redenominate all that nice cash in Deutschemarks to avoid getting hammered as the rest of the Euro Zone economies collapse.  Or, Germany might be the Euro Zone.  Maybe France, too. France is more of a hindrance than a help, really, but palling around with the French is the price Germans paid for re-admittance to the human race, after the recent…unpleasantness.

No finance minister can yet say such unpleasant things publicly.  But someone needs to to say them, especially since they are starting to sound less and less extreme.


Podcast for 03 Mar 09

In this podcast, Bruce, Bryan, and Dale talk about the president’s new budget, and the end of the Post-WWII global financial system.

The direct link to the podcast can be found here.

Observations

The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here. For podcasts from 2005 to 2007, they can be accessed through the RSS Archive Feed.


King Eddie’s Funeral (Updated)

Let me clarify something in the previous post.  Some commenters are saying that they don’t understand how government will allow private money to be created, and relinquish the death hold they want to keep on the economy.  The short answer is, I don’t think they’ll have a choice.  We’ll concentrate  on the US here, but keep in mind that the rest of the developed nations are in even worse shape than we are.

What allows the government–any government, but democratic ones in particular–to operate as they do is the consent of the people.  Even totalitarian governments have to worry about that, ultimately, although they can keep the lid on for a time, even for a couple of generations. But even totalitarian regimes often run into explosions which topple them, eventually.

But the loss of faith in a liberal, democratic government is the kiss of death for that government.  It doesn’t take a full scale revolution.  it just takes people to stop cooperating.  India was liberated through non-violent action.  So was South Africa.  nce the people say, “You’re done.” the government is done.

Right now our economic system is built on nothing more than the “full faith and credit” of the US Government.  And that will last only as long as we, the people, have faith in it.

Now this particular recession may not be the one that kills that faith.  It may be just one of the warning signs of a coming collapse.  But a crash is coming, and, I think sooner, rather than later.  We cannot continue indefinitely to fund the spending of the richest country on earth with the savings of one of the poorest.

Consider:

The total debt and future obligation of the US government now exceeds, by a substantial percentage, the total with of the country’s assets.  We have a mountain of debt and payment obligations that exceeds our ability to  meet, even if we were able to liquidate the entire country.

If we wish to retire those obligations we have essentially two alternatives:  We can repudiate them, or we can pay them off through hyperinflation, which, as a practical matter, amounts to the same thing.

For instance, let’s take social security and medicare.  We simply don’t have enough money to pay those obligations.  We can slash benefits, or eliminate cost of living increases, which is nothing more than  repudiating the debt.  We can raise the payroll tax to 30% or more, but that will slow economic growth so much that the increase in revenue will be more than offset by the increased unemployment  and slower GDP growth that would result, which would make it even more difficult to pay off other obligations, such as Treasury Bonds.  Or we can simply print the money, and pay off the paper obligation with money that has signifigantly less purchasing power than the face value of the obligation.

However we go about it, it amounts to a repudiation of all or part of our obliations, and reveals that the government is both faithless and, as investors take note of the repudiation and decide not to buy government paper any more, creditless as well.  What paper they have, they will attempt to unload on any idiot stupid enough to take them.

The dollar will collapse to the point that imported goods, even cheap, shoddily made Chinese ones, might as well be made of unobtainium.

The life savings of million upon millions of Americans will evaporate overnight.

There will be serious hardship, and massive unemployment.

That’s the kind of hardship I’m talking about.

So, how much trust will there be in a government who, after all that, comes back and says, “We’ve learned our lesson.  Trust us now.  It’ll all be different this time.” among a people who’ve watched the government repudiate all of the promises made over the last 70 years?

And how much more will this be true if there is a feasible, private alternative, consisting of hundreds, perhaps thousands of independent sources of money, and credit?  One whose reliability can be publicly judged every minute of every day, and which has no coercive power?

It wouldn’t take a revolution to force the government out of the money and economics business.  Or the retirement or health care business.  All it will take is a lack of trust. Who will want to do business with an entity that has utterly failed to deserve any trust?

The collapse itself will be the revolution.

UPDATE:  By the way, the government’s repudiation of its obligations has already begun, in regards to Social Security.  If you are in my age cohort or younger, you are not allowed to retire at age 65.  Your retirement age is now 72.  The government changed the deal.  For us, we have to wait an additional 7 years to begin collecting our benefits.  Those of us who do not die before age 72, that is.

That wasn’t the deal we had when we started our working lives.  The government unilaterally changed the terms of our Social Security compact.  They didn’t call it “repudiation” but, that’s certainly what it was.


Dead Ed, the Collapse, and eBay Saves Us All

My first reaction to Pres. Obama’s speech last night was depression.  Here were the Democrats giving the president standing O’s for completely converting the Republic into a social democracy.  I mentioned that on Facebook, and one of my readers said it reminded him of Amidala’s line from Star Wars Episode III:  “So this is how liberty ends…with thunderous applause.”

But on more careful review, I find that I am not, in fact, depressed over the long-term.  Indeed, last night’s speech seems to me not to herald the beginning of a new era for big government and socialism, but rather the last gasp of a dying ideology.

We are, I think, at the cusp of a new era, but it isn’t the one that Pres. Obama and his acolytes in the Congress are thinking it is.  Neither the Democrats nor the Republicans, it is clear, have any idea about what is happening.  Very few people do.  I am going to try and explain something very complicated, and do so very simply, and as briefly as I can.  So, with the realization that all simplifications are inevitably wrong in some particular, let me explain.

“Ed’s dead, baby.  Ed’s dead.”*

We stand now, I think, in a very historically similar position to the one described by Barbara Tuchman, in the beginning chapter of her monumental work on the outbreak of Word War I, The Guns of August:

20 May 1910:  The past passes in review

20 May 1910: The past passes in review

So gorgeous was the spectacle on the May morning of 1910 when 9 kings rode in the funeral of Edward VII of England that the crowd, waiting in hushed and black-clad awe, could not keep back gasps of admiration. In scarlet and blue and green and purple, 3 by 3 the sovereigns rode though the palace gates, with plumed helmets, gold braid, crimson sashes, and jeweled orders flashing in the sun. After them came 5 heirs apparent, 40 more imperial or royal highnesses, 7 queens, and a scattering of special ambassadors from uncrowned countries. Together they represented 70 nations in the greatest assemblage of royalty and rank ever gathered in one place and, of its kind, the last. The muffled tongue of Big Ben tolled 9 by the clock as the cortege left the palace, but on history’s clock it was sunset, and the sun of the old world was setting in a dying blaze of splendor never to be seen again.

Four years later, the world order of 1815-1914 was drowned in fire and blood.  The Age of Royalty was over, and the Age of Democracy had begun.  I believe that Pres. Obama’s speech of last night may very well be the historical equivalent to Edward VII’s funeral.

Ever since it began in late 2007, a blog called Fabius Maximus has been arguing that we are watching the decline and fall–indeed, collapse–of our current economic and financial system.  A précis of the argument can be found here, and a more comprehensive archive can be found here.  Just as the black-clad crowds lining the streets of the capitol of the British Empire on the morning of May 20, 1910 might have found it inconceivable that their generation would witness the collapse of both the European geopolitical regime, and, ultimately, the British Empire itself, so it may be inconceivable to us that we are witnessing the collapse of the Post-WWII economic and political regime.  But I believe it is nevertheless true.

“MONEY! Doesn’t it make you feel good just to say that, Jerry?”

Let me start by explaining what money is.  Money is a medium of exchange, that is, it is an object of some kind that I can exchange for goods and service, rather than trying to barter with people to obtain what I need.  It may consist of elaborately carved cowry shells, tiny beads painstakingly stitched to strips of leather, round pieces of metal with the image of guys named Julius or Claudius hammered into them, or little pieces of high-quality paper that say “Federal Reserve Note” on them.

But whatever it is, money has certain minimal characteristics.  It must be convertible, i.e., if I do a job for you, I have to be willing to accept it as payment, and whoever I buy bread or clothes from has to be willing to accept it in exchange, too.  It also has to be difficult to replicate, so that when I accept it, I am reasonably assured that it is the genuine article.

Get 'em while they last.

Get 'em while they last.

For nearly all of recorded history “money” has been synonymous with gold or silver.  And right up till the late 18th century, it was more or les the perfect money.  It was intrinsically valuable, in that raw silver or gold was as easily convertible as hammered or minted coins.  It was also practically impossible to counterfeit, the best efforts of alchemist to convert dross into gold notwithstanding.  It was also relatively rare, and it difficult to obtain new supplies of it without intensive–and extremely expensive–mining operations.

Additionally, there simply wasn’t much to buy.  Most people grew their own food, produced their own clothes from flax or wool, and built their own houses by hand.  Money was essentially a luxury, and it bought mainly luxury goods for fat cats.  Kings could raise and equip armies with it.  Merchants could buy nice clothes. But for the most part, money was a tool for use by the rich, and by the relatively few urban dwellers.  And, as such, gold or silver was perfect for that level of economic activity.

By the 19th century, though, there were lots more things to buy, and lots more city dwellers, and that trend was increasing rapidly.  Hard money became…problematic.  The thing about having a hard currency based in gold or silver is that, at the end of the day, whether you run a fully convertible gold standard, or some sort of fractional reserve system, the size of the money supply is always constrained by the amount of gold or silver on hand.

If the economy takes off on a tear, it’s extremely difficult to expand the money supply to meet the demand.  When the supply dries up, the economy just shudders to a quick stop, because nobody has enough spare money to fund more expansion.  So the economy collapses until it reaches equilibrium with the available money supply, and the cycle starts again.  Look at a chart of US economic activity in the 19th century and you see it’s a system of booms and busts, which were far steeper than any we’ve seen since the depression.  So the fundamental problem with a gold standard is that it’s relatively inflexible when used by a vibrant, diverse economy.  When everybody needs gold, and the demand is unpredictable, gold is very difficult to use unless you’re willing to live with severe booms and busts.

The Great Depression was the death knell for the gold-based world economic system.  Those nations that jettisoned gold the fastest, recovered the most.  Of course, WWII intervened in the depression, so it took a decade or so to get back to the business of commerce–as opposed to the business of building things to kill Nazis.   But, by 1944, everyone–on the Allied side, at least–had recovered enough breathing room to meet at Bretton Woods, NH, and hammer out a new economic system.

What they came up with was a system of fiat currencies, all freely convertible in the FOREX market.

Now, governments could adjust their money supplies appropriately by printing more money or less of it, and taxing their populations more leniently or more severely, as needed.  This is the system most of us have grown up with…and it’s dying.

It’s dying because of something innate in human nature that the gold standard was better equipped to deal with:  the urge to loot the system.

It’s an urge that has always been there.  Sometimes it has been the result of intentional government action to cheapen the currency.  If you were, say, the king of Persia, you didn’t need to consult the priests of Ahura Mazda to know that if you changed from using 10 grams of gold per coin, to using only 9 grams per coin, you could stretch your gold supply by 10%.  You could then take the extra gold, and buy yourself a nice hat.  Or use the extra gold to make one.  Whatever.

Of course, people would notice this pretty quickly, and items that used to cost 9 gold pieces would cost 10 pieces–inflation!–but because gold had an intrinsic value, the same weight of gold could be exchanged.  It was still pernicious, of course, but because gold had an intrinsic value–and because the supply of gold was relatively inflexible–it wasn’t usually seriously pernicious.

Sometimes, the urge to loot the system has been done by private individuals, who figured out that if they shaved a bit off the edges of their gold pieces, they could accrue enough gold shavings to buy themselves a nice hat, too.  This, by the way, is why when we began minting coins instead of hammering them out. They were minted with milled edges, making shaving attempts immediately obvious.

By the 19th century, the looting attempts became widespread, populist movements, like the “Free Silver” movement.  At the time, gold was real money.  If you took a bunch of gold to a Minting facility, the mint would return you an equal weight in gold coins–minus a nominal minting fee.  After huge silver deposits were discovered at places like the Comstock Lode, populist agitation began for minting silver in the same way, at a ratio of 20 ounces of silver for 1 ounce of gold.  The massive amount of silver floating around would, of course, have made this an extremely inflationary policy, and the farming and borrowing interests would have benefited by paying off bills for less than they had borrowed…enabling themselves to use the extra saving to buy a nice hat.

But during the First Age of Money, the looting was always constrained by the fact that gold had an intrinsic value, and that the supply of gold was inelastic.  There were, therefore built-in constraints to the looting impulse.

When the Bretton Woods Agreement launched the Second Age of Money, it solved the problem of the inelasticity of the money supply, and enabled monetary authorities to fine-tune the money supply in response to economic activity.  That was a good thing in the sense that it flattened–although did not eliminate–the business cycle fluctuations.

But the bad thing was that it completely removed any physical restraint on the money supply.  It depended on governments and monetary authorities to exercise self-restraint, rather than impersonal, externally imposed constraints.  The result has been 65 years of continually expanding credit, more or less constant inflation to a greater or lesser degree, and unrestrained spending and borrowing.

Governments–and their democratic (small “d”) constituencies quickly learned that they could loot the system.  Social insurance, medical care, military expansion…whatever the Big Idea of the minute was, we could have it.  And if we didn’t want to pay the taxes to the government to pay for it–and, mostly, we didn’t–we could simply borrow it.  We could obtain a whole bunch of little green pieces of paper now in exchange for a promise we’d pay back more little green pieces of paper sometime in the future.  In the meantime, we could buy all the hats we wanted!

But now, we are obligated to pay back various people about fifty trillion pieces of green paper.  Unfortunately, the entire household worth of everyone in the country is worth about forty trillion pieces of green paper.

How can the current economic and financial system possibly be considered solvent at this point?  How will re-expanding the cycle of debt re-invigorate it?

No, we’ve had our fun.  We got to loot the system for 65 years.  Now, the hat bill is coming due.

I suspect we’ll pay the hat bill the same way that Germany repaid their war reparations debt after WWI.  “Hey, you remember that reparations bill for 3 billion marks that we’re supposed to pay next week?  Yeah.  I just wanted to let you know that we’ve sent that order off to the printers, this week, and we should have that printed up for you by Tuesday.”

The result was massive hyperinflation, the collapse of credit, and 5 years of compete economic stagnation, serious economic pain, severe unemployment…and the ability to start over in the mid-20s with a clean balance sheet.  Clean enough, in fact, that by 1936 Germany had more or less completely emerged from the Great Depression, while the employment rate in the United States hovered at around 18%.

What Pres. Obama is proposing may result in nothing more than additional spending that helps bring about the collapse of the Post-WWII economic regime, while at the same time providing–temporarily–a social safety net that will provide some help as we pass through a difficult transitional period.

“I was there at the dawn of the Third Age of Mankind…”

OK.  Maybe it’s not that grandiose, but I think we are seeing the dawn of the Third Age of Money.

No one in the government realizes how the economic world is changing.  So their proposed solutions are likely to be exposed over time as ineffective and, perhaps even counter-productive.  The credibility of governments around the world is now invested in staving off an economic collapse.   When their failures become evident, and their “solutions” are exposed as fantasies, that credibility will collapse.  Who will want to buy government bonds, or use worthless government money?  Who will trust the governments who lead us into the economic abyss?

Unfortunately, rather that realizing that we are entering a transition, and trying to discover how to shepherd us through that transition, they are invested in preserving the dying system of government-regulated money supply and credit.  And even if they realized that we were in a transitional period, they would still do nothing about it because it would require voluntarily releasing their power over the economy.

Governments have always been in charge of money; determining what money is, how it will be exchanged, how new money will be created, etc.  In part, this is traditional, in that only government had the resources and ability to fund and oversee mining and exploration activities, regulate what legal tender consisted of, and all of the other monetary functions.  There simply were no other large organizations in existence to perform those tasks.

It wasn’t until the 17th century that organizations began to emerge that could begin performing those tasks, and not until the 18th century that it became practical.  Private money of various types began to sprout up everywhere.  18th-century America was, for a time, replete every decent-sized bank issuing its own currency based on deposits.

Eventually, the Federal government cracked down on that private money, not so much from jealousy of the government’s role as the issuer of currency, but because private banks suffered from the same tendency to loot the system, issuing more and more inflated currency until it was worthless, and they ended up wiping out their depositors in the collapse as their obligations came due.  There were some solid money banks of course, but the spectacular failures of so many private currency attempts led the government to tax them so heavily that private currency issuance became uneconomic. Governments may not have been perfect, but the constraints of the gold system meant that they didn’t fail as completely and spectacularly as private banks did.

What was missing in private currency of the time, and what has been missing in the current post-WWII financial system is feedback.  Yes, there is some, but it takes a long time to filter into the monetary authority, and is derived indirectly from statistics on economic activity, rather than by any sort of direct observation.  The Fed raises interest rates today, for instance, and it takes around eight months to observe the indirect effects of the monetary policy change.   This is why the role of the Fed, has often been described as steering a car by looking through the rear-view mirror.  Based on seeing where you’ve been, you make decisions about where you must go.  That may be a form a feedback, but it is so separated in time from the inputs that it’s an inherently unstable system.

By the same token, what killed depositors in banks that issued private money was a lack of feedback.  It wasn’t possible to see that bankers were looting the system in time to withdraw your money.

We call this lack of feedback asymmetrical information.  We’ve never been able to even approach the ability to have full information about what a bank or government is doing that may affect the money supply, or economic activity as a whole.  We’ve never been able to see all sides of the story, as it were.  So, we’ve had to more or less leave it in the hands of government, simply because governments have been the only organizations with the size and scope to reduce, even partially, the problem of feedback.

So, it seems pretty hopeless, doesn’t it?  The financial world we’ve grown up with is collapsing under the sheer weight of looting.  If governments can’t do it, and a return to the gold standard can’t do it, then where are we?  At the edge of another dark age?

Not quite.

I foresee the rise of private money once again, and returning in such force as to negate the government’s role in the economy.  In fact, the pieces for creating the Third Age of Money are already there.

Your new ATM

Your new ATM

The Internet will be the platform for the new money.  But it’s just the platform; the communications media.  The actual objects that make up the Third Age of Money will almost be located in cyberspace.

First, there is encryption.  In the not-too-distant future, you will go online with a persona, i.e., an online identity with a unique, highly encrypted digital signature.  No more logging in with different user names and passwords at 100 different web sites.  Your persona will be uniquely identified as you through the use of 4096-bit or 8192-bit public key encryption.  Your persona will be impossible to forge or duplicate.  It will be unique.  Your “bank” and your “money” will be similarly encrypted.

Second, is your ATM/debit card.  It won’t be exactly the same, of course.  It will be far more secure, probably through the use of biological identification systems to verify authorization, such as retinal scans.  It will be linked directly to your persona’s bank account.

Third, is the ability of all the major banks and credit card companies to do online transactions, and to convert one system of private money to another at a publicly known exchange rate.  So, you can pay directly to your account–or withdraw from it–in Discover Dollars, or MasterBucks, or Credit Suisse Francs.  Or perhaps there might even be a universally acknowledged unit of currency–the “Credit”–that all the private companies agree to use.

But, the most important element of creating a reliable private money system that is resistant to looting the system is feedback. The reduction of asymmetrical information.  And that exists, too.  eBay has been using it for years.  Indeed, in no small way, the system implemented by eBay may be a key element of our future.

Imagine a system where, every time I do business with your persona, I rate your reliability, and it doesn’t matter of the persona is an individual or a bank…or a government.  Every day, millions of people who do transactions in MasterCard can rate the reliability and value of the MasterBucks system.  Private companies like Standard and Poors or Moody’s would not only rate MasterBucks, but consumers would rate the reliability of S&P or Moody’s judgments.

And not only are the bank’s persona’s being rated, but your persona is as well, by every one who does business with it.

Put them all together and you have a secure form of private money that’s convertible, impossible to forge, and is subject to constant feedback about its value and performance.  Does MasterBucks have too high a debt ratio or too much exposure to non-performing loans at MasterCard?  No problem.  It’s instantly convertible to Credit Suisse Franks.  And the conversion rate lowers MasterBucks reliability ratings even more, signaling the company to correct its course, or lose its depositors.

Think of the implications this has for taxation, especially income taxation.  Keep all your money in Credit Suisse Francs, say, and the US government will never even be able to see a record of your deposits or withdrawals.  How will they track your income?  And who will want to pay governments that failed to prevent the collapse for…well…anything?  Who will accede to the demand for money by governments that repudiated their debts, and destroyed the life savings of millions?

I can foresee huge implications for the future that are very pro-liberty.  In the long term.  In the short term, though, if I’m right, and the current financial system is collapsing we will be in for a very rough decade or so.  Very rough indeed.

_________________

*Apologies to Quentin Tarantino.


Podcast for 22 Feb 09

In this podcast, Bruce, Michael, and Dale talk about the first month of the Obama Presidency.

The direct link to the podcast can be found here.

Observations

The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here. For podcasts from 2005 to 2007, they can be accessed through the RSS Archive Feed.


Cartoons, Chimps, and Scared White People

Who is that poor, dead ape?

Who is that poor, dead ape?

Yesterday, in a surprisingly foolish move, New York Post cartoonist Sean Delonas attempted to somehow use the story of the Unfortunate Chimpanzee Incident in Connecticut as a visual segue to some sort of commentary on politics.  Although, I’m not entirely sure what point was being made.

The reference to writing  the next stimulus bill seems to me to be a clear reference to Pres. Obama.  He is, after all the guy the guy who’s been out pushing for the thing since day one.  They guy who tried to get Republicans and Democrats together to vote for it a bipartisan fashion.  The number one cheerleader.  He is inextricably linked in the public’s mind with the stimulus bill.  We even call it the Obama Stimulus Bill.  So, who, then are we supposed to think this cartoon is referring to?  Who else could we reasonably infer it refers to?

Now, Obama isn’t the first president who’s been the butt of Chimp references.

He is, however, the first president whose racial heritage includes centuries of invidious comparisons to the great apes.

Which is a shame, actually, because for reasons entirely unrelated to his race, Pres. Obama has a physical feature that is perfect for comparison to a chimp.  His ears.

Chimpy McHaliburton Bushitler

Chimpy McHaliburton Bushitler

I mean, have you seen them? They are Ferengi-class ears. Lyndon Johnson’s soundhorns were practically unnoticeable by comparison.  Sarah Palin may be able to see Russia from her place in Alaska, but with those satellite dishes Mr. Obama carts around on his skull, I bet he hears the occasional Da, and Khorosho! from the bowels of the Kremlin while sitting in the Oval Office.  I don’t think Mr Obama is Jesus, but I wouldn’t be surprised at all to learn that he does hear it every time a sparrow falls.

But, irrespective of the comedy gold that could be mined from Pres. Obama’s unfortunate auricular appendages, and unlike Mr. Bush, who had some relatively chimp-like expressions, a major newspaper can’t make those same references to any African-American, much less the president of the United States, and expect to elide past the deserved criticism for it.

How then could the cartoonist possibly be blind to the possible inferences that would be drawn?  And for that matter, what of the vaunted “layers of editors” the mainstream media employs?  The cartoon didn’t raise any red flags in the mind of the Page 6 Editor?  the Op/Ed Editor?  The Managing Editor?

Apparently not.

I simply can’t believe that the staff of a major newspaper were blissfully unaware that even an oblique Obama/chimpanzee reference would be…troublesome.  And even if they did, you’d think the dead president reference might raise a red flag or two in the publisher’s suite, wouldn’t you?

Combining that into the dead chimpanzee president has to be almost the apex of bad judgment by a major media outlet.

But, once the cat was out of the bag, the Right couldn’t leave it alone.  Instead, the defenders of the cartoon jumped in with their explanations.  Her, for example, is John Hinderaker at Powerline:

Readers of the Huffington Post and–who else?–Al Sharpton construe the cartoon as a possibly racist attack on President Obama…There are several problems with this critique. Most obviously, Obama didn’t write the “stimulus” bill. If anyone is being called a chimp, it is Nancy Pelosi and Harry Reid.

And yet, we don’t call it the Pelosi-Reid Stimulus Bill, do we?  How terribly odd.  This defense of the cartoon is little short of obtuse.

And Post Editor-n Chief Col Allen isn’t any more convincing.

“The cartoon is a clear parody of a current news event, to wit the shooting of a violent chimpanzee in Connecticut,” Allan said in a statement. “It broadly mocks Washington’s efforts to revive the economy. Again, Al Sharpton reveals himself as nothing more than a publicity opportunist.”

I yield to no man in my contempt for Rev. Sharpton, but this is terribly lame.  How, in fact, does this broadly mock the stimulus effort.  It can’t be a reference to the bill itself.  that bill, unfortunately, is not only not dead, it is now the law of the land.  From a political point of view, the passage effort was successful.  And why the reference to the person who “wrote” the stimulus bill?  That person–if not the actual writer, the primary cheerleader for it–is comfortably ensconced in the Oval Office, savoring his victory on this issue, and moving on to mortgage relief.

The only part of Mr. Allen’s statement with which I agree is that it is, in fact, “is a clear parody of a current news event, to wit the shooting of a violent chimpanzee”.  But to what end?  If we assume that it is not a reference to the president, then what, exactly is it about?  And why do so many people seem to think it is a reference to the president?  Why is there no label on the dead ape so that we can know what it is supposed to represent?

"Hi There, Eric. I Can't Help But Notice You're Black. Let's Talk About How Black You Are."

"Hi There, Eric. I Can't Help But Notice You're Black. Let's Talk About How Black You Are."

You see, the thing about one-panel political cartooning is that it takes an extraordinary amount of talent to provoke a complicated train of thought from a single, hand-drawn picture.  You have to be clear, concise, and often humorous, and make a clear, polemical point in one panel. Somehow, the average person thinks the point is entirely different from what Mr. Allen says it is.  And that is, as our Soviet friends used to say, “no coincidence.”

Yesterday morning, before this thing had blown into a full-scale brou-ha-ha, The guys at the Opie and Anthony Show had seen it, and they had their producers out on the street, showing the cartoon to the morning commuters on 57th Street in NYC, and asking them, “What do think this cartoon means?”

What they got was a collection of nervous mumbles that amounted to, “Uh, I don’t really know.”  “I can’t say.”  “Er, uh, I can’t talk right now”.  Oh the passersby had time to read it, but when given the chance to express an opinion about it publicly, all of the sudden it was to dense for them to take in, or they had pressing engagements elsewhere.

Which is an interesting reaction, considering Attorney General Eric Holder’s speech on race, coincidentally given yesterday.

“Though the nation has proudly thought of itself as an ethnic melting pot, in things racial we have always been and continue to be, in too many ways, essentially a nation of cowards,” Holder said.

“Though race-related issues continue to occupy a significant portion of our political discussion and though there remain many unresolved racial issues in this nation, we average Americans simply do not talk enough with each other about race.”

The funniest response to that came from a  Jeff Emanuel piece at RedState, which was titled, “Hi There, Eric. I Can’t Help But Notice You’re Black. Let’s Talk About How Black You Are.”

Well, we probably don’t talk enough about race.  We don’t have those frank exchanges of racial views.  Indeed, we don’t even have humorous public statements about race, even tangentially. Because all it takes is for Dom Imus to say something on the radio like, “That’s some nappy-headed hos right there,” and he’s done. Al Sharpton comes around with a group of lusty, gusty fellows to demand your firing, as soon as he hears about it.  And you lose your livelihood, because he’ll get it.

If you’re white, there’s no upside to having a talk about race.  You run the risk of accidentally or unknowingly saying something insensitive, at which point the best thing that can happen to you is that you’ll be publicly reviled as some sort of bigoted troll.  Why take the risk?

Is that cowardice, or simply the result of a prudent calculation of risks and benefits?

No, the only time we talk about race, is when some buffoon like Sean Delonas makes a public faux pas that can’t be ignored.  And I don’t see that changing any time soon.


Jack’s Friends

Political Wire writes that tomorrow might be an interesting day in Congress, corruption-wise.  It seems that some things have been going on around Congressman John Murtha (D-PA) which may not be entirely copacetic.

There’s a potentially big story brewing on Capitol Hill…  Apparently 104 members of Congress of both parties — 42 Republicans and 62 Democrats — secured earmarks for a lobbying firm linked to Rep. John Murtha (D-PA) in a single bill. The earmarks were inserted in a bill Murtha controlled as the defense appropriations subcommittee chairman.

It looks like business as usual, of course, until we learn that the company’s executives and clients seem to be big, big political donors to Rep. Murtha.

So, I guess it is business as usual.


Podcast for 15 Feb 09

In this podcast, Bruce, Michael, and Dale talk about Roland Burris, and the stimulus bill.

The Direct link to the podcast can be found here.

Observations

The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here. For podcasts from 2005 to 2007, they can be accessed through the RSS Archive Feed.


Misremembering (Updated)

You’ve got to hand it to former IL Governor Rod Blagojevich.  He’s the anti-Midas.  Everything he touches turns to…not gold, anyway.  His magical touch has once again appeared, and this time the touchee is the senator he appointed to replace Barack Obama, Roland Burris.  Apparently, Blagos Magic Touch™ caused Sen. Burris to, uh, misremember things.

U.S. Senator Roland Burris was asked to help raise campaign funds for Rod Blagojevich before the ousted Illinois governor named him to the seat left vacant by Barack Obama.

The governor’s brother, Rob Blagojevich, asked Burris three times to help with fundraising, according to a Feb. 4 affidavit the senator filed with state Representative Barbara Flynn Currie, who chaired the Illinois House panel that impeached Blagojevich.

Burris told the House panel on Jan. 8 that the governor hadn’t asked for money or favors in exchange for the Senate seat. In a letter accompanying the affidavit, Burris’s lawyer said the senator hadn’t been able to “fully respond” to questions.

He didn’t mean to give contradictory testimony. But it was all so confusing and difficult.

“While Senator Burris testified truthfully and to the best of his recollection before the Impeachment Committee, given the fluid nature of the questions and answers between the Senator and the committee, and based upon our subsequent review of the hearing transcripts, the Senator was unable to fully respond to several matters that were included in questions during his testimony,” lawyer Timothy Wright wrote in the Feb. 5 letter.

You see, he meant to tell the committee that Robert Blagojevich, the governor’s brother had asked him to do some, uh, fund-raising to the tune of $10,000, on three separate occasions, but he just wasn’t given a chance to testify to all these things fully.  So, it’s really the committee’s fault, with their slipshod procedures and what not.  That’s why he told the committee that he had not been asked for any fund-raising at all.

You’d think that a former state Attorney General would be able to negotiate the shoals of testimony, but I guess not.

Still, he told the committee that he had no contact with anyone connected to the governor in association with the appointment.  And he specifically denied having been asked to raise any money.  That’s a difference that would seem difficult to explain, but Sen. Burris  is having a press conference today in which he will, presumably, clarify these matters to everyone’s satisfaction.

UPDATE:

The press conference has started.  “I was never inconsistent in my statements”.

He says he answered affirmative when asked if he’d had contact with Gov Blagojevich’s cronies, and provided Lon Monk’s name as an example, after which, the questioning moved on to another subject.

He says his testimonies are fully consistent.

The Chicago press corps is asking him some pretty tough questions.  They don’t seem to be buying his schtick.

This should be interesting to follow.


They Just Won’t Leave it Alone

T

Apparently, we need a muzzle for this

Apparently, we need a muzzle for this

he Democrats in Congress keep talking about it, and talking about it:  The Fairness Doctrine.  The newest musings about it come from Rep. Maurice Hinchey (D-NY).

More and more Democrats in Congress are calling for action that Republicans warn could muzzle right-wing talk radio.

Representative Maurice Hinchey, a Democrat from New York is the latest to say he wants to bring back the “Fairness Doctrine,” a federal regulation scrapped in 1987 that would require broadcasters to present opposing views on public issues.

“I think the Fairness Doctrine should be reinstated,” Hinchey told CNNRadio. Hinchey says he could make it part of a bill he plans to introduce later this year overhauling radio and t-v ownership laws.

When Bruce addressed this recently, commenter PogueMahone responded:

Well then you are kooks.  This is no fairness doctrine.  Despite the wishes of some, there will be no “fairness doctrine” bill passed.

Kooks.

Huh.  maybe.  But for people who aren’t going to pass it back into law, they sure talk about it a lot.

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