Recently, while listening to the Opie and Anthony show, I heard an interview with Loius CK, the comedian. And he said something that struck me as quite profound. And quite true.
Back in olden times–i.e., prior to the 1930s–our paper money wasn’t actually money, as such. Instead, it was a receipt for the real money–gold, or silver–that we had stored in the bank. And the amount of gold we had determined how many of those receipts we could get. The gold or silver we held had an intrinsic value, and the paper currency we carried was simply a representation of that intrinsic value.
Then, in the 1930s, we simply got rid of the metal, and kept the receipts. Ever since then, the paper money we carry around with us has no intrinsic value. And the value of that receipt is worth whatever the government says it’s worth. It is a medium of exchange, and nothing more.
You may have $1,000,000 in the bank. And if the government says that it’s only worth a cup of coffee in exchange, then that’s exactly what it’s worth. It doesn’t matter if acquiring that million bucks was the work of a lifetime. The government can, if it wishes or is unwise, reduce the stored value of your life’s work to a trip to Starbucks.
Just something to think about.
That’s the subject Paul Krugman addresses in his NYT Op/Ed piece today. In fact, he implies that even talking up the possibility of inflation comes solely from bad political motives, mostly from people who don’t grasp The Fierce Moral Urgency of Change™.
Why shouldn’t we worry about inflation, according to Prof. Krugman?
Now, it’s true that the Fed has taken unprecedented actions lately. More specifically, it has been buying lots of debt both from the government and from the private sector, and paying for these purchases by crediting banks with extra reserves. And in ordinary times, this would be highly inflationary: banks, flush with reserves, would increase loans, which would drive up demand, which would push up prices.
But these aren’t ordinary times. Banks aren’t lending out their extra reserves. They’re just sitting on them — in effect, they’re sending the money right back to the Fed. So the Fed isn’t really printing money after all.
But, let’s grant that the current monetary moves aren’t immediately inflationary. What happens when the economy recovers and the banks do begin to spnd those extra reserves? Krugman attempts some sleight of hand, in an effort to make it appear that he addresses that concern.
Still, don’t such actions have to be inflationary sooner or later? No. The Bank of Japan, faced with economic difficulties not too different from those we face today, purchased debt on a huge scale between 1997 and 2003. What happened to consumer prices? They fell.
Yes, they did. But since Japan hasn’t had a real economic recovery even today, and is entering its third “Lost Decade”, that really isn’t a compelling argument. Since 1999, Japan’s rate of GDP growth has averaged 1.31%, which is less than half of the average GDP growth rate of 3% a mature economy should experience. Indeed, over the last decade, Japan has experienced exactly 5 quarters where GDP growth was at 3% or more. In that same period, there have been 9 quarters when GDP contracted. The highest annual rate of growth was in 2000, when the annual GDP growth was 2.85%.
So, let’s not pretend we know how the inflationary pressures fall out in Japan once a recovery hits…until there actually is a recovery.
ON the other hand, since our policymakers seem hell-bent on following the same path the Japanese did in the 1990s, the return of inflation when the economy recovers might turn out to be worry we can avoid until sometime in the relatively distant future.
My latest Examiner column.
Remember the uproar during the 2004 presidential election about supposed voter disenfranchisement and voter intimidation that allegedly took place in Florida. Reports of blacks being stopped at police roadblocks and turned away from voting places? The Civil Rights Commission as well as numerous media outlets descended on the state in an attempt to validate the rumors. The story remains an urban myth to this day despite the fact that no evidence of any of that taking place was found.
Fast forward to the 2008 election and these video tapes:
What you would expect to happen, at the time and given the video evidence, happened:
The incident – which gained national attention when it was captured on videotape and distributed on YouTube – had prompted the government to sue the men, saying they violated the 1965 Voting Rights Act by scaring would-be voters with the weapon, racial slurs and military-style uniforms.
Career lawyers pursued the case for months, including obtaining an affidavit from a prominent 1960s civil rights activist who witnessed the confrontation and described it as “the most blatant form of voter intimidation” that he had seen, even during the voting rights crisis in Mississippi a half-century ago.
What happened next, however, wasn’t expected, although for most it comes as no real surprise:
The career Justice lawyers were on the verge of securing sanctions against the men earlier this month when their superiors ordered them to reverse course, according to interviews and documents. The court had already entered a default judgment against the men on April 20.
Got that? A default judgment. A done deal. Guilty.
But they were ordered to drop the charges and case and settle for this:
A Justice Department spokesman on Thursday confirmed that the agency had dropped the case, dismissing two of the men from the lawsuit with no penalty and winning an order against the third man that simply prohibits him from bringing a weapon to a polling place in future elections.
Ed Morrisey asks the pertinent question:
Recall, please, that Democrats screamed about the supposed politicization at Justice during Alberto Gonzales’ tenure as Attorney General for replacing political appointees who serve at the pleasure of the President. They claimed that the replacement of nine US Attorneys was a plan by the Bush administration, supposedly through Karl Rove and Harriet Miers, to affect the outcome of investigations and prosecutions. It touched off a Constitutional fight over executive privilege that continues to this day, as the House and Senate Judiciary Committees are still conducting its “investigations” into this supposed politicization.
This looks significantly more like politicization of outcomes that anything alleged during the Bush administration, especially since the DoJ already won the case. In fact, the government had prepared arguments for penalties against the men as late as May 5th, before the political commissars under Attorney General Eric Holder ordered them to withdraw. Holder, during his confirmation hearing, had called career DoJ lawyers his “teachers” and the “backbone” of Justice. Apparently, the political leadership trumps teachers and backbone when it comes to voter intimidation on behalf of Barack Obama.
So will the same Congressional committees open an investigation into this reversal to benefit voter intimidation on behalf of the administration?
Just as important, will the same portion of the leftosphere which went berserk over Gonzo and made a cottage industry of the allegations treat this obvious politicization of justice the same way they treated the alleged politicization by the Bush administration?
Methinks probably not. Let the spinning (or ignoring) begin.
You really can’t blame her for trying to put – excuse the expression since it seems to have become cliche – lipstick on a pig, but Nancy Peolsi’s attempt to change China’s mind concerning curbing its CO2 seems to have been an abject failure.
Pelosi called them “hopeful”. That’s diplo-speak for “absolutely nothing substantial changed from the previously held position”. The fact that they even saw her would be deemed as “hopeful” but certainly not substantive.
Rep. James Sensenbrenner (R-WI) sums up the trip:
“It’s business as usual for China,” said Mr. Sensenbrenner, the ranking Republican on the House Select Committee for Energy Independence and Global Warming. “The message that I received was that China was going to do it their way regardless of what the rest of the world negotiates in Copenhagen.”
“Their way” consists of giving lip service to curbs while demanding the “rich nations” pay the freight for curbing such emissions in China (and the rest of the “emerging nations”). China refuses to jeopardize its economic growth for something it obviously believes is much less of a threat than others do. And why should they when it appears the upcoming conference plans on exempting them anyway?
We, on the other hand, seem bound and determined to try to do what would be tantamount to the task of cleaning up the ocean up by putting economy wrecking filters only on our shore line. Little or no effect. China and India share similar philosophies on this question and are emerging as the number one and two emitters on the planet. I think they’re right. The threat, if there is one, is minimal at best. Wrecking one’s economy to hopefully make a less that one degree Celsius change at some distant point in the future (maybe) seems to me to be the height of folly.
But that’s certainly where our politicians seem to be headed. And, to compound the problem, they’ve adopted a “damn the torpedoes, full speed ahead” philosophy, ignoring the 10 year cooling trend torpedo as well as the “China and India” aren’t going to play along” torpedo.
No one wants dirty air or dirty water – no one. But this hysterical reaction to what seems to be a natural earth cycle and the human hubris which claims we both effect and can change that cycle is going to put us all in the poor house unless some sanity (like in China) prevails.
So what’s on the Middle Eastern agenda for the Obama administration?
Frankly that’s the question being asked by a lot of foreign policy watchers right now, especially since President Obama has added Saudi Arabia to his trip itinerary for an upcoming trip to the area. Originally scheduled to first make a stop in Cairo for a speech, he is now stopping in SA first. This, of course, has the Egyptians a bit miffed. Egypt was touting his trip and speech to Cairo as a sort of vindication of their foreign policy as well as their resurgent leadership role among Arabs in the area. Now that’s not quite as easy to claim.
One group sees it as tied closely to the Israeli-Palestinian track, focusing on the Arab Peace Initiative and the coming unveiling of the Obama approach to Israeli-Arab relations. Another sees it as tied more closely to Iran, preparing the Saudis for the coming engagement (or confrontation) with Tehran.
I happen to think it is a little bit of both, but mostly tied to Iran. NoKo has popped a nuke (and we’re aware of the ties between Pyongyang and Tehran). Iran has fired a long range missile. Intelligence says Venezuela and Bolivia are providing Iran with uranium (which both deny). That requires a bit of a change in focus of the mission from one exclusively focused on Israel/Palestine. Iran has heated up and the Arabs are not friends of Iran, certainly feel threatened by them and darn sure don’t want to see Iran establish itself as a regional (and nuclear) power. SA would be a logical stop for discussions on that issue.
As to the Israel/Palestine question, Marc Lynch of Foreign Policy magazine wonders:
… will he reinforce or challenge the “moderates vs resistance” frame which he inherited from the Bush administration? The Arab leaders he has been meeting, like the Israelis, are perfectly comfortable with that approach, dividing the region between Israel and Arab “moderates” vs Iran and Arab “resistance” groups like Hamas and Hezbollah. That’s the easy path. If followed it is likely to fail badly, destroy the hopes for change which his engagement policy has raised, and leave the region right back where Bush left it.
I think there is no question he plans to shake up the status quo. But how he chooses to broker “change” in the engagement policy, his change may face the same risk of abysmal failure other policies have produced. The Hill is reporting that Obama plans on challenging Israel’s plan to continue to allow West bank settlements to grow.
“Each party has obligations under the road map,” Obama said after referencing his meeting last week with Israeli Prime Minister Benjamin Netanyahu. Obama said he has been “very clear” on the need to stop settlement and outpost activity, and he also said Israel has obligations to ensure a viable Palestinian state emerges from the peace process.
Israel has rejected that portion concerning the settlements on the West Bank. That rejection came after the Netanyahu/Obama meeting in Washington DC.
Netanyahu has set out the Israeli negotiating position:
“The government of Israel under my leadership is committed to the political and international agreements signed by the governments of Israel, and we expect others to honor their commitments as well,” Netanyahu told the Knesset. “We want an end to the conflict, and we want reciprocity in the claims on both sides and their implementation. Unfortunately, in this we are also being innovative. We should not have to innovate; it should have been obvious. However, when we are asked to recognize our international commitments, I say yes, and I want others to respect their commitments as well.
“We are prepared to act, and we will take concrete steps towards peace with the Palestinians,” Netanyahu continued. “We also expect the Palestinians to take such concrete steps on their side, and it would be good if the Arab countries joined in the effort towards peace, and take both concrete and symbolic steps towards normalization, and not later, but right now. They are asking us to act now, and so the Palestinians and the Arab countries should also be asked to act now.”
Or shorter Israeli stance – if we’re required to live up to international commitments, the same demand must be made of (and accepted by, and acted upon) by others included in these negotiations.
Right now, one of the major obstacles to any such negotiations is not with the Israelis, but among Palestinians:
The Palestinian Authority faces its own challenges in brokering a peace deal, namely the split between Hamas and Fatah — and, therefore, between Gaza and the West Bank — that essentially renders a two-state solution a three-state solution. Since the violent splinter between Hamas and Fatah in 2007, the U.S. has dealt only with Abbas.
So does the US change its policy and actively enter into negotiations with a terrorist group in hope of brokering a reconciliation? The chances of such a reconciliation seem remote. And of course, the splintering within the Palestinians makes the talk of a “two-state solution” an exercise in unachievable rhetoric for the time being. Why should Israel enter into serious negotiations about such a solution when they are unachievable as it stands today?
This will be an interesting trip to monitor.
More to come.
Edit: Changed Ecuador to Bolivia – thanks for the catch, looker.
Whether or not the decisions to close certain Chrysler dealerships was political motivated is still an open question, and based mostly on anecdotal evidence as well as an incomplete analysis data. Regardless, the evidence available thusfar, when viewed in light of the Obama administration’s previously demonstrated willingness to meddle for partisan gain (UAW anyone?), suggests that in the very least more investigation is warranted.
As the investigation unfolds (the yeoman’s work of which is being done by Doug Ross and Joey Smith), there are couple of things to keep in mind. Although many people have referred to the closing list of dealerships as a “hit list” it makes much more sense to concentrate on the dealerships remaining open and regarding it as a potential “friends Obama supports” list. By way of example, the evidence unearthed by Joey Smith regarding the RLJ-McLarty-Landers enterprise reveals that big time Democrat donors and partisans are reaping enormous benefits from the Chrysler plan in the form of all its competition being wiped out. So who owns this luckiest of dealerships?:
In my analysis of the Chrysler dealers that will remain open, I came across one dealer group that stood out to me.
The company is called RLJ-McLarty-Landers, and it operates six Chrysler dealerships throughout the South. All six dealerships are safe from closing.
The interesting part is who the three main owners of the company are. The owners are Steve Landers (long-time car dealer, 4th-generation dealer), Thomas “Mack” McLarty (former Chief of Staff for President Clinton), and Robert Johnson (founder of Black Entertainment Television and co-owner of the NBA’s Charlotte Bobcats). Landers has given money to Republicans in the past, but McLarty campaigned for Obama in 2008, and Johnson has given countless amounts of money to Democrats over the years.
Smith has found a similar fortune for Lithia Motors, whose CEO Sidney Deboer is a Democratic donor (although he’s also given to Republicans) and has come out publicly in favor of the Obama administration.
Of course, all of this is still anecdotal, but the planned closings look awfully fishy when the list of canceled dealerships is so totally dominated by Republican donors, and the list of survivors features prominent Democrat supporters.
Regardless of the above, Nate Silver has provided the excuse for Obama supporters to safely ignore this story by declaring the percentage of Republican car dealers to be so high in comparison to Democrats, that there should be little to no surprise when the closing list is so chock full of GOP partisans:
There is just one problem with this theory. Nobody has bothered to look up data for the control group: the list of dealerships which aren’t being closed. It turns out that all car dealers are, in fact, overwhelmingly more likely to donate to Republicans than to Democrats — not just those who are having their doors closed.
Overall, 88 percent of the contributions from car dealers went to Republican candidates and just 12 percent to Democratic candidates. By comparison, the list of dealers on Doug Ross’s list (which I haven’t vetted, but I assume is fine) gave 92 percent of their money to Republicans — not really a significant difference.
There’s no conspiracy here, folks — just some bad math.
Despite what Silver asserts (i.e. that the control group of non-closing dealerships should be examined), he does no such thing. Instead, he researches the Huffington Post’s Fundrace database for donations from car dealers to arrive at his decision that such occupation gives to the GOP at the tune of 8-1. However, Open Secrets arrives at a much different conclusion, especially over the long term, in which dealers only gave to the GOP at approximately a 3.5-1 clip. At those numbers, one would expect to find somewhere around a quarter of the closings to affect Democrat donors, instead of the 2.36% found thus far:
In fact, I have thus far found only a single Obama donor ($200 from Jeffrey Hunter of Waco, Texas) on the closing list.
Another review of all 789 closing dealerships, by WND, found $450,000 donated to GOP presidential candidates; $7,970 to Sen. Hillary Clinton; $2,200 to John Edwards and $450 to Barack Obama.
Of course, it’s important to remember that statistics do not prove the existence of anything, just its likelihood of existing. Nevertheless, the details uncovered so far suggest that partisanship may have indeed played a role in deciding which franchises remained open.
In the first 100 days since President Obama signed the American Recovery and Reinvestment Act into law, we have obligated more than $112 billion, created more than 150,000 jobs and helped communities and tribes in every state and territory. But recovery is more than just a compilation of statistics; it’s the return of hope and optimism about the future that comes with making life better for communities and families across the country. And it’s proof of America’s vast capacity to create real progress in the short term as we emerge from an economic crisis that was years in the making.
Jim Harper of Washington Watch comments:
Well, I feel better already!
For perspective, $112 billion is just shy of $370 per person or $1,150 per U.S. family.
Even more perspective…that’s more than $746,000 per job “created.” The United States has lost almost $2.5 million jobs in the first four months this year, 539,000 in April alone. So let’s be honest here, the “stimulus” bill is having no real impact on the job market.
While there is all sorts of silly criticism emerging on the right (including the pronunciation of her name and the fact that she likes certain latin foods), there is an emerging criticism which I think has some validity. Most of of focuses on a speech she delivered at UC Berkley in 2001 and published later by The Berkeley La Raza Law Journal.
“While recognizing the potential effect of individual experiences on perception, Judge Cedarbaum nevertheless believes that judges must transcend their personal sympathies and prejudices and aspire to achieve a greater degree of fairness and integrity based on the reason of law,” Sotomayor said.
“Although I agree with and attempt to work toward Judge Cedarbaum’s aspiration, I wonder whether achieving that goal is possible in all or even in most cases. And I wonder whether by ignoring our differences as women or men of color we do a disservice both to the law and society.”
Although she attempts to have it both ways (“I agree” and “we do a disservice”), she seems to really be claiming that some level of gender or racial “empathy” is necessary to render “fair” judgments. And that only those who have lived that life are capable of such renderings. Here she essentially admits that to be the case as she perceives it:
“Personal experiences affect the facts that judges choose to see,” Sotomayor said. “My hope is that I will take the good from my experiences and extrapolate them further into areas with which I am unfamiliar. I simply do not know exactly what that difference will be in my judging. But I accept there will be some based on my gender and my Latina heritage.”
How else do you interpret her statement except to say, “we can’t change the fact that personal experiences affect our work and the best we can hope for is we will “take the good” for those experiences and apply them …?”
That, of course, helps explain the statement most of the right object too the most, i.e.:
“…a wise Latina woman with the richness of her experiences would more often than not reach a better conclusion than a white male who hasn’t lived that life.”
Given what she said above, this makes perfect sense. Although she claims to agree “judges must transcend their personal sympathies and prejudices and aspire to achieve a greater degree of fairness and integrity based on the reason of law”, she then builds the case that a) such isn’t really possible, and b) in fact race and gender based experience is a positive that should be injected in such “reason of law”.
Her ruling in the case of the 18 white firefighters in New Haven CT seems to indicate she is indeed inclined to use race and gender bias in her decisions.
That is a legitimate and troubling point and certainly one which requires a very close look. But Republicans need to lay off the silliness (and words like “racist”) and stick with the legitimate points of contention her nomination bring. And they need to explain their concerns in a way which is both complete and easy to understand.
It would be the perfect ending to Specter’s desperate attempt to hold on to his office by switching parties. TPM is reporting:
Rep. Joe Sestak (D-PA) is privately telling supporters that he intends to run for Senate, TPMDC has confirmed.
“He intends to get in the race,” says Meg Infantino, the Congressman’s sister, who works at Sestak for Congress. “In the not too distant future, he will sit down with his wife and daughter to make the final decision.”
The move would constitute a primary challenge to Sen. Arlen Specter (D-PA), who intends to run for re-election in 2010, after having switched parties earlier this year.
Sestak is a retired Navy Admiral in a time when that’s a very good thing to be, especially if your primary opponent is Arlen Specter. I have no idea how a state wide race would shape up for the two sides, but in a Democratic primary I can’t help but believe Sestak would trounce Specter. And deservedly so. Everything I’m reading is PA Dems are having a very hard time warming up to Specter. Think about it, how can you take seriously a guy who switched parties simply because he knew he’d get killed in a Republican primary and claimed he never promised to be “a good Democrat?”