Simon Donner has a great graph showing how our corns -- and thus our heaps and heaps of corn subsidies -- are used. A couple notes. There's an interesting chicken-and-the-egg issue here with corn subsidies. Our immense creativity in how we use corn is[...]
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The Dog is thinking that there might be some of you who do not like the current economy and who could blame you? Unless you have so much money that it earns a good living for you separate from your salary (here's hoping you all have salary and not hourly[...]
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The recent rash of institutional failures plaguing Wall St. has made big headlines and will only serve to reinforce the dominance of economic issues on the campaign trail. But these high-profile financial diasasters actually obscure a more dramatic development in the economy that is leaving Republicans panicked and speechless with nowhere to turn. The Republicans would be in deep, existential trouble on the economy even if the major lending institutions were still doing just fine.
The bigger problem for Republicans is that the very way they measure the health of an economy is going the way of the dodo. What terrifies them (and what should terrify you) is that the economy we live in today (minus recent spectacular failures) is the economy they created by design, partially to win votes. No, I'm not kidding.
The Republicans are not lying when they say the fundamentals of the economy are strong, and call everyone a nation of whiners in a mental recession, and talk about how everyone is exaggerating their economic concerns. They're not out of touch: they simply look at the numbers that they think dictates the health of an economy, and they literally can't see what the problem is.
I'm no economic expert, but the basic parameters don't require an econ degree to understand; they're actually pretty simple. For Republicans (and far, far too many Democrats), there are only three categories that matter:
And for each category, there are certain measures of their health:
So this is pretty simple, actually. If the Dow Jones and other investment indicators are doing OK, the "ownership society" is doing OK. If unemployment in low, the working shlubs are doing OK (if you have a job, what's your problem?). And if GDP growth is high and core inflation is low, the country is doing OK. These are the "fundamentals" Republicans talk about when they say the "fundamentals are strong."
What has Republicans panicked and distressed is that, at least until very recently, all these indicators--the indicators by which they judge the basic health of the economy--were actually doing pretty well. Sure, personal and nationa debt were at record levels, and commodity prices were spiking, but the "fundamentals" remained strong. But people were still angry, hurting, and becoming increasingly desperate. If people's investments aren't going up, or people are out of work, or growth is slow, the GOP has answers for those problems. Bullshit answers, but answers. But the GOP has NO answer for an economy where the stock market is doing great, the GDP is growing, and people are working two or three jobs but still can't pay the bills. They literally have no answer: all they can do is deny the problem even exists.
At least until unemployment recently hit 6.1%, Republicans could claim with much justification that the economy was doing just fine: stocks were up, housing was down slightly but still up by wide margins compared to a decade earlier, unemployment was low on average by historical standards, GDP growth was good, and core inflation was low. Neoclassical Friedmanist economics dictates that--so long as government largely stays out of economic business--investment growth will expand--while finding a perfect equilibrium with labor that keeps unemployment low and inflation practically nonexistent. For these economic ideologues, it works as predictably as the tides, and as beautifully as the music of the spheres. We appeared to have approached that Chicago School nirvana. So what were you all whining about, exactly?
This is an existential crisis for Republicans and rigid neoliberals of all stripes. Just as surely as the necessity of dealing with global warming creates a major crisis for neoliberal free-market ideology, so too do the failure of the major, accepted economic indicators to adequately measure the health of a nation's economy throw the entire neoclassical economic project into a tailspin. If Republicans were ever to admit that a nation's economy could could be souring in the face of the accepted "fundamental" indicators, it would create nothing less than revolution--or at least a Keynesian reformation--in economics.
The reasons for the failure of the classical indicators to describe economic well-being are numerous, and tend to get complex. Suffice it to say that the biggest factor is that wages have not kept pace with even "core" inflation; the wide availability of credit vehicles (most notably credit cards and home equity loans) hae allowed many people to have the appearance of economic security when in earlier times they would have faced bankruptcy; core inflation numbers are actually higher than they appear; wild speculation in commodity prices driven by rampant greed has caused "core" inflation to be less relevant when talking about cost of living; the GDP is a terrible measure of a nation's health, as anything, including going to the doctor for a devastating illness or selling an item at a pawn shop, counts as "growth" in goods and services; the profits of the investor classes are going primarily to the super-rich, leading to a divide even between rich and super-rich such that not even rich investment wealth is distributed in a helpful way even to the luxury sector; and many other reasons besides. Books like Nickel and Dimed, Strapped and others tell the stories of the millions of people who are hurting and cannot get by in our "fundamentally strong" economy.
Perhaps most tellingly, the GOP-led push to get as many people into the "ownership society" as possible led to huge asset bubbles in housing and other sectors, driving up prices beyond the range of normal affordability and pushing people into investment situations they could not afford. This was done as a deliberate strategy: Karl Rove and his minions believed that the more people were "invested" in housing and stocks, the more Republican they would become. As Naomi Klein points out in The Shock Doctrine, it had worked for Margaret Thatcher in Britain, and there was no reason to believe it shouldn't work here. As one wealthy Republican told me at a Washington, D.C. luncheon at a big pro-free-trade conference:
We need to get more people invested in the stock market. If everyone owns a piece of Halliburton, nobody will be complaining about them anymore because they'll all say, "hey, I own part of that. Leave it alone!"
It was a deliberate strategy to gain votes, and it backfired horribly. Not enough people got into the ownership society; many who got in were just as unceremoniously kicked out when their ARM mortgage started to adjust; and the rest of America continued to struggle more and more, working longer and longer hours to service higher and higher mountains of personal debt. And all this, even as every one of their precious economic indicators said that the patient was healthy.
Now, the Republicans have no answers. They cannot solve a problem they cannot see. All they have left is denial that there even is a problem.
And that, more than any major bank failure, is what is starting to send shock waves through the neoliberal political and economic world.
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To help you fiddle while Rome is burning: A Street Fighter 2 concept album. I particularly like "Where is Ryu?"Via Tom of the Lee. And image used under a Creative Commons license from Lin 1000.[...]
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By now you've all seen it:
[W]hen there was a vacancy at the top of the State Division of Agriculture, [Palin] appointed a high school classmate, Franci Havemeister, to the $95,000-a-year directorship. A former real estate agent, Ms. Havemeister cited her childhood love of cows as a qualification for running the roughly $2 million agency.
Her childhood love of cows.
The Wasilla High School yearbook archive now doubles as a veritable directory of state government. Ms. Palin appointed Mr. Bitney, her former junior high school band-mate, as her legislative director and chose another classmate, Joe Austerman, to manage the economic development office for $82,908 a year. Mr. Austerman had established an Alaska franchise for Mailboxes Etc.
Her former junior high school band-mate. A franchisee for Mailboxes Etc.
Now, look. There's a refreshing lack of concern for establishment gatekeeping here, no doubt. But it's not supposed to be a sit com.
Here, again, is another illustration of how incredibly dangerous it could be to install Slick Sarah Palin in the Vice Presidency that Dick Cheney built.
And by the way, just as an aside, if her provincialism causes you to question the "Slick Sarah" moniker, consider this:
In the middle of the primary, a conservative columnist in the state, Paul Jenkins, unearthed e-mail messages showing that Ms. Palin had conducted campaign business from the mayor’s office. Ms. Palin handled the crisis with a street fighter’s guile.
"I told her it looks like she did the same thing that Randy Ruedrich did," Mr. Jenkins recalled. "And she said, ‘Yeah, what I did was wrong.’ "
Mr. Jenkins hung up and decided to forgo writing about it. His phone rang soon after.
Mr. Jenkins said a reporter from Fairbanks, reading from a Palin news release, demanded to know why he was "smearing" her. "Now I look at her and think: ‘Man, you’re slick,’ " he said.
I don't know Paul Jenkins. I didn't put those words in his mouth. That's an on-the-ground, contemporary assessment of Palin. S-L-I-C-K. A deft backbiter since day one. She may be ignorant of the finer policy points -- or even bedrock central tenets, such as the Bush Doctrine -- but you don't have to know policy to deliver an icepick to the temple.
But back to the dangers of marrying Cheneyism to Palinism. We already know, if only partially, the extent to which Cheney's extraordinary secretiveness allowed him to put his own partisan operators in place to execute the "administration's" most daring extralegal experiments. (That's a euphemism for "perpetrating impeachable offenses," in case you were wondering.) It was Cheney's intimate knowledge of the levers of power that move official Washington that allowed him to do so mostly unchallenged and under the radar. As a result, the operatives he installed were able to work in near total secrecy, with Cheney (so far) successfully flouting federal law requiring that he provide even the numbers, names or salaries of his staffers.
If there's anything redeeming at all that can be said about they way Cheney in particular perpetrated this anti-democratic abuse of the federal government, it's that while his henchmen and hires were almost universally subversive of the Constitution in both their views and their actions, they were at least arguably competent to the governmental roles to which they were ostensibly assigned.
Palin, however, is the Tom DeLay to Cheney's Newt Gingrich. Relatively speaking, the guileless thug who inherits a carefully orchestrated, if essentially groundless (or in the case of Cheney, outright illegal and unconstitutional) "governmental" construct, but who lacks the patience and finesse to keep investigators and oversight committees at legal arm's length.
And so we may well expect from a Palin Vice Presidency not only the ill-considered and impatient grasping at the trappings of power (and the accompanying disregard for the safeguards against corruption represented by power's official levers and mechanisms) embodied by DeLay, but also -- still more frighteningly -- the use of Cheney's secrecy precedents to hide the whole debacle from view.
What really stings about the Times' article is that it exposes Palin's cronyism and irresponsibly provincial worldview, not to mention McCain's own shocking irresponsibility in selecting her. Imagine the dangers to the country and the Constitution of being able to appoint childhood friends, already perhaps in above their heads just in trying to govern 670,000 person Alaska, to high federal office and to use the legacy of Cheney's secrecy to conceal it all from the public.
Imagine never even having the right as an American citizen to know that the
Secretary of Agriculture's Special Assistant to the Vice President for Agricultural Affairs' sole qualification is a childhood love of cows.
US News: "John McCain's Journey from Maverick to Liar"[...]
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Markos analyzes some polls showing Palin not doing as well as she was a week ago, by a long shot. And one point the media hasn't realized yet - Palin energized our side too. Above is a chart of our monthly traffic, visitors (yellow) and page views (yellow plus orange) over the past four months. Note that halfway into this month, it's September 15, we're already where we were at the end of each of the past four months. That's due to the Republican convention and Palin. Why do I say that? Check out the daily traffic, below.
The week of August 25 was the Democratic Convention. As you'll see in the chart above, traffic bumped up a little - to around 73,000 readers a day and 80,000 page views a day - but not a bump to write home about. Then on Friday August 29, the day after the Democratic Convention finished, and a day that is traditional our worst week day of traffic, our traffic spikes. That morning, John McCain announced Sarah Palin as his pick. Our traffic spiked on that day to 92,000 visitors and 100,000 page views. (Note that I copied the chart at around 5pm Eastern on Sept 15, so that day's results aren't reported in full.)
The next week was the GOP convention. Our traffic that week, with all the Plain controversies flying in the news, our traffic jumped to around 150,000 readers a day and 160,000 page views a day - compared to the 73,000 and 80,000 we saw during the Democratic convention. Palin doubled our traffic, and last week our traffic is still 65% higher than it was during the Democratic convention.
So, yes, Palin has done wonders for the base of the Republican party. She's done wonders for the base of our party too.
Alaska Gov. Sarah Palin campaigned in Colorado today. She addressed the Wall St. crisis:
This is an issue of real concern," Palin told thousands gathered in a rodeo ring in Golden, Colorado. But, she said, "I'm glad to see the Federal Reserve has said no to using taxpayer money for a bailout."
.... Palin accused Wall Street regulators of being "asleep at the switch" and vowed that she and McCain would "put an end to the mismanagement and abuses." "We're going to reform the way Wall Street does business and stop the golden parachutes for CEOs who betray the public trust," she said.
One line from her gubernatorial speeches she is unlikely to repeat:
Palin herself may not be the most authoritative spokesperson on such issues. In the past, when she was running for Alaska governor, she freely admitted to a reporter that she got a "D" in macroeconomics in college.
ABC notes: [More...]
What precise reforms would Palin like to make, to better protect US investors? Unfortunately there's no way of knowing for sure. The candidate is not taking questions from the press.
Just this morning Marc Ambinder wrote: America's gut reaction to Sarah Palin has been[...]
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The McCain campaign is getting more absurd by the minute. Now they're claiming that when he said "the fundamentals of the economy are strong," he was referring to ?the American worker and their innovation and their entrepreneurship, the small business."[...]
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