Obama's Catastrophe

Words matter.
Would someone please tell President Obama that?
In the campaign, Obama pledged to rid the government of the politics of fear and replace it with a politics of hope.
I guess that's why, when he was still pitching his stimulus bill, he predicted that an already bad economic situation would become a "catastrophe" if the legislation did not pass. That is one way to talk over the heads of the Senate and directly to the people, but that word, and other similar statements from the White House, have long-lasting and far-reaching effects.
How does the actual owner of stocks and bonds --in an investment portfolio or a 401k-- actually react to the statement that we are a step away from a catastrophe? What is he or she likely to do with his investment when the President states (incorrectly) that this is the worst economic crisis since the Great Depression?
I'll tell you what happens: the faith of the investor in his or her stocks and bonds erodes and fades away. That investor sells, driving the market down. The value of publicly owned companies has dropped by almost 50 percent since November. Billions of dollars of savings have been lost, and billions more will be lost if the market continues spiraling downward, spurred on by the gloom and doom coming from the White House and the political class in general.
Here are some economic truths worth remembering: Land, especially developed land, never becomes worthless. Like gold it has an inherent value. The collapse of housing prices has more to do with the hyperinflation of real estate prices during the past few years than it does with the credit crunch. The credit crunch happened because houses became too expensive and the market walked away from real estate. When prices went down --when the bubble burst-- then the banks were jammed up with bad paper and homeowners found themselves "under water."
One thing President Obama does well is the rhetoric of hope. It is about time he started spreading some confidence-restoring sunshine around the country.

That's It For John...

Stick a fork in John McCain. He’s done. The race, for all intents and purposes, is over. Next month the country will elect Barack Obama President by a comfortable margin and give him a Democratic congress to work with.

This will be followed by a lengthy and cruel recession, which we are already entering.

Being a patriot, I honestly hope that Obama has the chops to handle what’s about to happen because few presidents have been tested in the way that he will be tested. May God bless his leadership and grant our President success.

If the issue this year had been the Iraq war or terrorism, McCain might have won. Those issues are in what baseball players call his “wheelhouse.” Instead, there was a banking collapse and a panic on Wall Street with losses comparable to the 1929 Wall Street Crash. Being the party in power, the Republicans get the sullied end of the stick, and that includes McCain, who does not speak fluent Economics.

It also might have been better if McCain had gone to the character issue on Obama months ago, rather than saving it for now. Normally it might have gained traction in October, but people aren’t listening because the Crash is deflating their life savings and they are rather preoccupied.

It might have helped if McCain’s campaign hadn’t gone chickens**t and hidden Sarah Palin for two weeks after the conventions, just when she was gaining with the voters. It also would have helped if Palin hadn’t choked miserably when interviewed by lightweight anchorwoman Katie Couric.

It might have helped if McCain had been a lot more aggressive on the stump and in personal appearances. Save for a week or so of swagger when he named Palin for the VP nomination, he has looked tired and old. He let Obama get away with murder in the first two debates, not deigning to set the record straight when Obama obfuscated it.

In short, John McCain lost it fair and square. Obama came to play and McCain phoned it in.

So why pile on McCain? Rolling Stone has an article out, the theme of which is that in the past John McCain has been…a jerk. Undoubtedly he has had his moments, but so has Barack Obama. So did Jack Kennedy, FDR, and a dozen other candidates and presidents I can think of off hand.

If it’s all the same to everyone else, I am voting for John McCain anyway. His politics is not a perfect match for mine, but they are closer than Obama’s are. I don’t intend to critique anyone else for the way they vote. We all must follow our own minds and hearts.

I hope, however, that with two wars and a Great Recession in prospect, all of us Americans can put aside stupid partisan bickering and unite behind the President in trying to extricate our country from the worst crisis since World War II.

Notes on the Way to Armageddon

Best headline of the day: “Congress lives up to its 10% approval rating.”

I suppose you can’t expect a bunch of venal vote whores –Republican and Democrat-- to act on their consciences so close to Election Day.

On the other hand the people oppose the bailout. I have great faith in the vox populi, but they are being educated on the subject of the credit crisis by the vox vapuli, the mainstream press and the politicians.

The press certainly is not qualified to either explain the crisis or to advise the public on the best solution. The press is made up today of J-majors: persons who majored in journalism.

Rather than immersing in subjects that might allow insight into current affairs; such as political science, economics, business, science or history; J-majors learn the newspaper and broadcast news business. This is why the press gullibly repeats the talking points of the political parties, makes horrible errors of fact, succumbs to bias and speaks and writes such terrible English.

So the people are without a clue as to the best course to follow and simply repeat what they have heard about not bailing out Wall Street “Fat cats” with taxpayer money and eliminating “golden parachute” severance pay for failed executives. This winds up in constituent letters, emails and phone calls sent to our representatives and is why Congressmen fear voting for the credit relief act.

A cheerier scenario might be the failure of Congress to act and the adjustment of the economy by market forces. Let me take another sip of Kool Aid and explain.

If the credit markets freeze up, it will not be permanent. Smaller and more solvent banks will get lending back on its feet after a few months on a limited basis and on a regional scope.

There was a time when smaller hometown banks administered most credit cards and mortgages were written almost exclusively by local financial institutions. The smaller banks are in a great position to fill that niche, as are corporations and individuals with capital to lend who are willing to take only reasonable credit risks when writing mortgages and business loans.Meanwhile one of the main contributors to our misery, the OPEC nations, can be expected to bring down the price of oil substantially as dollars dry up and oil purchasers are affected by the credit crunch. $30 a barrel oil will put the roses back in the cheeks of the economy.

Eventually new investment banks will rise to take the place of Bear Sterns, Lehman Brothers, et al. If they loan money wisely and resist excessive greed, they will finance the recovery of the economy.

While we wait for this miracle to happen we will have to tighten our belts. At the last debate, when asked what he might cut in such an economic crisis, Senator Obama listed several programs he would ADD, including aid to education, national health care and a drive to alternative energy solutions, which would cost us an additional trillion dollars. He was unable to tell Jim Lehrer the name of a single area in which he might make cuts.

I give Obama credit for his sincerity, because these are the programs represent why he is running for President in the first place. But if he does implement these programs, we will have to bankrupt the general population with massive new taxes. Barack Obama just does not understand the mess we are in.

Democracy Fails a Test

Nancy Pelosi couldn’t resist the partisan attack just before the House of Representatives voted on the rescue of the American credit system.

She had to place the blame for the crisis on Bush, his cabinet, the Republican Party, the conservative philosophy and deregulation before the house acted. Enough Republicans took offense to kill the bill in the subsequent vote.

Why? Not because their feelings had been hurt, as Rep. Barney Frank so flippantly suggested, but because to vote aye would have been tantamount to endorsing Pelosi’s remarks about their own party, people and ideals. If it had been a Republican speaker making those remarks, he would have lost Democratic votes just as surely.

And thus the measure went down in defeat and 777 points were lost off the Dow Jones Index. Pelosi scored political points and God knows how many people on the cusp of retirement found their investments cruelly devalued and are now looking at one or two or five or ten more years of work before their retirement. So casually do our elected leaders play with the lives of the people.

The people, I am sure, blame the Republicans and the Democrats and the greedy Wall Street investment bankers for this crisis. The people, as usual, are right.

Personally, I am hugely disappointed that my faith in American democracy has been so misplaced. I honestly thought that working together as patriots, the Congress could craft legislation to solve this crisis quickly and move it to adoption in true bipartisan fashion.

Instead, our leaders have given us political theater. Somewhere in this mess may lie 20 years of power for a political party able to pin the blame on its rival. That has been the overriding mission on both sides. The disgust of the American people at these antics is pervasive.

If the credit system shuts down, it means a lot of short-term suffering for everyone until bankers, relying on the tried and true principles of lending and financing, find some capital they are willing to lend. Hopefully, that will happen before the economy is wrecked and we go into a depression that lasts decades and not just a few years.

Froofraw

Although this election is by no means a sure thing for either side, the left is already coming up with excuses why Barack Obama lost. I guess they never heard of the Power of Positive Thinking…

Right now the most popular theory is simple racial bigotry –that Obama will have lost because he is black. Curiously that is the one reason for an Obama loss that doesn’t make sense.

Let us assume for a moment that about half the voters are conservative. Given that three of the last four presidents were named either Bush or Reagan, it’s not such a stretch to imagine. Would they vote for a very liberal Democrat under any circumstances? Color doesn’t even enter into it. These voters, who are excited by Condoleeza Rice and Colin Powell, will always pick the conservative in the race.

Then let us assume that the other half of the voting public is liberal. You’ll get no argument from Al Gore on that proposition; he got a majority of the popular votes in 2000. If he had also gotten the votes Ralph Nader won that year he would have (a) taken 51 percent and (b) be finishing up his second term right about now.

Does anyone mean to argue that this 50 percent of the population –the most liberal 50 percent— would allow bigotry to dictate their votes? There may be racist liberals our there but I imagine they would be harder to find than rocking horse manure.

Thus, it would appear to be impossible, mathematically, for racial bigotry to determine the outcome of the election. There may be a few liberal hypocrites who are turned off by Obama’s color, but I doubt you could fill an auditorium with them. As for the authentic bigots, they would never have voted for a liberal anyway.

To his infinite credit, Obama has already rejected the notion that he could be defeated by racial prejudice. In saying this Obama emphasizes the very positive things his nomination says about America and proves, once again, that he is substantially brighter than many of his “friends.”

History is my hobby and my profession. Imagine he pleasure I got this week from Professor Joseph Biden (D-MBNA) when he described for CBS’ Katie Couric how the President broke the news of the Great Stock Market Crash to his countrymen in 1929:

When the stock market crashed, Franklin D. Roosevelt got on the television and didn't just talk about the, you know, the princes of greed. He said, 'Look, here's what happened,'

Where to begin! To his credit, Biden got the year right: It was 1929 when Wall Street tanked. The president, however, was Herbert Hoover. Biden should know this because the Democrats ran against Hoover and the Depression right through the 1960 elections. FDR was president from 1933 until his death in April 1945.

In 1929 there were no television networks in existence. If I am not mistaken, Philo T. Farnsworth hadn’t invented the electronic television until 1927. He was probably still tinkering with it when the stock market crashed. I don’t believe that Hoover made any radio statements at the time. The Crash was shocking, but it was some weeks before the full meaning of the catastrophe began to dawn on people.

Just imagine if Sarah Palin had uttered this quote instead of Biden…

Naomi Wolf, who crafted a new, less tree-like image for Al Gore in 2000, is afraid of Sarah Palin, by the way. In a recent piece in the Huffington Post she claims that Palin and Karl Rove and Dick Cheney plan to establish a fascist government if McCain wins the election. She also claims that the government –or Palin or someone—has been stealing and/or opening her mail:

Most disturbingly to me personally is the mail tampering I have both heard of and experienced firsthand. My tax returns vanished from my mailbox. All my larger envelopes arrive ripped straight open apparently by hand. When I show the postman, he says, "That's impossible." Horrifyingly to me is the impact on my family. My children’s' report cards are returned again and again though perfectly addressed; their invitations are turned back; and my daughter’s many letters from camp? Vanished. All of them. Not one arrived.

Perhaps they were harboring a moose that needed shooting in that “camp?” –or they possessed a library book that should be banned? Is there no villainy to which the Governor of Alaska will not stoop? Someone tell Sarah Palin to stop hanging around Naomi Wolf’s mailbox!

The Girls Next Door are no more. The E! Network show about Hugh Hefner and his three live-in girlfriends will have to be replaced since two of the three appear to be splitting off from the harem.

Kendra Wilkinson, the sports-obsessed member of the blond trio, is apparently seeing Philadelphia Eagle Hank Baskett, who is roughly 50 years younger than the 82-year-old Hefner.

Meanwhile Holly Madison, who has said many times that she wants to be the mother of Hefner’s baby, is moving out of the master bedroom. Besides being 82, Hefner is still married to his next-door neighbor, Kimberly Conrad and says he does not want to father any more children. Madison told Us magazine she intends to leave the mansion and has been seen in company with illusionist Criss Angel. When Holly disappears that leaves Bridget Marquardt in Bedroom Number 2 –and she’s married to some guy in Ohio –Chad Christopher Marquardt.

Just your typical American family.

Defining Life

Let’s abandon economics, that dismal science, for a day and contemplate something simpler, like the nature of life.

Sarah Palin was challenged the other day on a strictly logical basis ( a refreshing change of pace) by an editorial writer who wondered why her Down syndrome baby Trig’s life was considered too precious to be aborted while, at the same time, Mrs. Palin supports capital punishment. How does she reconcile the two views as a Christian?

Good question. This has come to be called “the seamless garment” argument, recalling the seamless cloak Jesus wore and which the soldiers gambled for as capital punishment was being administered to Him.

Flipping through Bible pages back to the original Torah, the five books of Moses, we find the Ten Commandments (Exodus 20 1- 13), the literal translation of one of them being “Do not commit murder.” When King James the First’s scholars were translating Exodus, no doubt cribbing from Tyndale, they rendered it in the now obsolescent second person as “Thou shalt not kill.”

For me, “kill” and “murder” are absolutely interchangeable so far as connotation is concerned. Both verbs refer to an unjust ending of a human life, such as a slaying for profit or out of anger. Elsewhere in the Torah, as crimes against God and man are enumerated by the Lord and the punishments prescribed, we find the death penalty. The point of noticing that is not because I propose that we “shall not suffer a witch to live,” but to demonstrate that the taking of life is permitted in a judicial setting. A crime is committed, a guilty party is named and suffers the penalty prescribed by the Law.

Here then is the difference between Trig Palin and, say, man on Alaska’s death row for murdering a convenience store clerk. Trig is innocent. Baby Palin was accused of no crime other than having a disability his family will find inconvenient. Death Row guy, on the other hand, took a human life for profit. He is actually guilty of something for which death is an appropriate punishment. Thus, Sarah Palin –and the rest of us morally opposed to abortion but favoring capital punishment-- wears a seamless garment, if the criterion for preserving life it its innocence.

As an unobservant Catholic I suppose I should be the last person in the world to stick up for the Magisterium, the teaching authority, of the Church. But the last two elections have been made interesting by candidates who seek to substitute their wisdom for the theology the Church has been struggling to evolve over the past 2,000 years.

We’ve had, in the most recent cycle, Speaker of the House of Representatives Nancy Pelosi and Senator Joe Biden weighing in –as Catholics— on when they think that a fetus becomes a human being. The two of them got bogged down in Augustinian and Thomist arguments as to when the soul first inhabits the body –while ignoring the teaching of the Church that abortion is illicit at any time during a pregnancy –the status of the soul notwithstanding. They both got sharp raps on the knuckles from the Catholic bishops for that.

Most pro-choice Catholic politicians subscribe to the Mario Cuomo doctrine, which he enunciated at a speech at Notre Dame University some years ago. Briefly, Cuomo said that although on a personal level he accepts the Church’s teaching on abortion, as a public servant he cannot impose that personal, religious viewpoint on the general public, which may not share his faith.

It makes you wonder what he believes. If he believes –as a Catholic-- that abortion is the non-judicial taking of a life (remember “Do not commit murder?”), which is what the Church teaches, then as a pro-choice politician, he believes that a species of murder is allowable.

So how does a Catholic politician resolve this conflict? The answer is that he doesn’t.

Catholicism is not a buffet from which we might sample some dishes and leave others alone. It is in his acceptance of the Church’s teachings by which a Catholic is defined. If, especially in matters of life and death, a politician cannot accept church teachings, he or she should not identify himself as a “Catholic.” This leaves the Catholic politician with the stark choices of getting out of politics or changing one’s views at the risk of alienating the voting public.

There is the argument is that the Church has no business imposing its morality on the secular state. My answer is that it has already. What we consider to be right and wrong traces back, inevitably, to religious beliefs, be they pagan or Judaeo-Christian.

Certain acts, by their intrinsic injustice, were set apart as crimes by the earliest human societies. Not even a cannibal in a lost valley in New Guinea is free to steal what he wants or to kill without paying some form of compensation. Even in the most remote reaches of the Amazon, honesty is honored and liars execrated. From this most basic, instinctual understanding of justice have come our laws, sometimes defined in religious terms along the way, but always recognizably founded on an instinctual, visceral notion of what is right.

When we begin to redefine justice to suit our convenience or to evade responsibility, we open a Pandora’s box of troubles.

Setting Limits on the New President

I don’t envy the next president, whomever he may be. His job will be to administer a government of limitations and dreams deferred, thanks to the financial crisis that has washed over our country like a tsunami.

The evolving plan of the government to buy up the “toxic” real estate investments and holdings of the banking community is not a cure for the credit crisis. It is more like emergency surgery –a radical mastectomy that must be done that removes the palpable cancer --that also disfigures the patient without guaranteeing permanent remission.

The cost will fall somewhere between $700 billion and $1 trillion dollars –as if we bought an extra army, navy, air force, marines and coast guard –twice! My poor math works it out to be $3,322 more or less for every human being in the country.

How we are going to come up with the money and what we will have to give up to do so will be the big issues for the next president. He will be in the same spot that you or I would be in if we had living expenses of $3,000 per month and a net income of $2,900. A budget like that does not leave any room for anything but survival –and hard choices. Food, water, rent and electricity make the cut. Your cell phone does not. Neither does Internet access, movie tickets, cable TV or owning a car if a bus line is handy.

In terms of running a country, we will have to decide what is essential –what we need to live-- and how we hope to pay for it. Should the government invest billions in alternative energy or should private industry? What about global warming? What about our proverbial crumbling infrastructure? How much of a defense establishment do we need? What about health care for the uninsured?

I infer nothing by way of an answer to these questions, but I do point out that they are among the issues that will be discussed. We have a lot of items on our national agenda: Some of them may be deferred and others cancelled outright.

One thing is for certain: We cannot have everything we want whenever we want it. We are going to have to set limits on ourselves and not take it out on our representatives in government when they have to say “No.”

I remain a believer in supply-side economics. A dollar that remains in the private sector is vastly more likely to generate a dollar in taxable wealth than the same dollar turned over to the government in taxes. When Kennedy lowered taxes, revenues went up. When Reagan lowered taxes, revenues went up. It even worked, though more modestly, for George W. Bush. We must raise taxes, but let us keep them affordable. Let’s not tax ourselves out of business.

Let us slash spending across the board. Assuming our budget is about $3.1 trillion for 2009, first we leave untouched $1.9 trillion. That is mandated spending for Social Security, Medicare, Medicaid, interest on the national debt (about $270 billion) and unemployment insurance.

This leaves us $1.2 trillion where we can make cuts. These programs include the Department of Defense, the War on Terror, Health and Human Services, the Dept. of Education, Veterans’ Affairs, Housing and Urban Development, the Department of State, Homeland Security, the Dept. of Energy, the Justice Department/FBI, Agriculture, NASA, Transportation, the Treasury, the Department of Labor, the Department of the Interior, the Army Corps of Engineers, the Small Business Administration, Congress, the Federal Courts, the Executive Branch, the EPA, the National Science Foundation, the National Endowment for the Arts, Public Broadcasting, and all other discretionary spending.

No cuts can be made in any of those departments without howls that “essential programs” are being sacrificed. Everyone’s ox will be gored. Everyone’s taxes will go up.

But the world will not come to an end. If there is even the least up-tick in property values or in investor confidence, the government may actually make a profit on the distressed real estate investments it is buying. And maybe…just maybe…we will have come together as a nation to solve a crisis. It’s a long shot, I admit, but worth hoping for.