Monday, December 01, 2008

Negotiating a spousal contract for the Secretary of State

 

Politico has a copy of the detailed agreement negotiated between the Obama and Clinton people to spell out what Bill Clinton will and will not do as the husband of the Secretary of State.

If you think that this will stop the whole Bill and Hill show from coming to Foggy Bottom, you're more of an optimist than I am. Kirsten Powers shares this skepticism.

Recently, Newsweek reported on a call between Bill Clinton and Democratic strategist Donna Brazile, wherein Bill ranted for an hour about Obama. Oblivious to the irony, he exclaimed: "If Barack Obama is nominated, it will be the worst denigration of public service."

This wasn't just campaign strategy to draw distinctions with an opponent. It was a deep, visceral hostility toward the upstart who Bill believes blocked his family's rightful return to the White House. Clinton even reportedly tallied an 81-page list of grievances against the Obama campaign for attacks (real and perceived) against his lady.

So what will happen when the inevitable policy disagreement arises - say, on talking to Iran - between the Obama and Clinton camps? Before you can say, "leak," the Clinton's side of the story will be all over the press, making the president look weak.

Candidate John Kerry learned this lesson in 2004 after bringing on some Clinton aides to save his campaign. Within days, he was humiliated by a story in The New York Times about how he had called Bill Clinton - recuperating from surgery in the hospital - to get advice about how to run his campaign.

But the leaks will be small potatoes compared to the impromptu press conferences Bill will hold as he roves the world. He'll be constantly pressed for his opinion on world events - and self-control isn't exactly his strong suit.

If he couldn't behave when his own legacy hung in the balance or stay on message when Hillary's campaign for the White House was on the line, why think he'll be able to behave now?

That's assuming he even wants to control himself.

Everything the Clinton camp does will be with an eye toward a future run for Hillary. If this lines up with what's good for Obama, great. If not, they'll always protect their own flanks first.

Bill Clinton has never demonstrated that he can control himself. And with these new limitations on his activities with his Global Initiative and library, I imagine as soon as he starts feeling straitjacketed, he'll be sharing his musings with eager journalists. Barack Obama demonstrated that he can run a campaign with great discipline and control, two words never connected to Bill Clinton. Running the entire government is an entire different job and I expect he'll soon find that he can't control Bill Clinton any more than the Hillary campaign could do so. And now it will all be out there on the global stage.

Labels: Bill Clinton

posted by Betsy Newmark permalink 6:53 AM 0 comments

Blaming America

 

Dorothy Rabinowitz has a devastating column about how Deepak Chopra popped up on CNN to blame America for the terrible Mumbai terrorist attacks.

What happened in Mumbai, he told the interviewer, was a product of the U.S. war on terrorism, that "our policies, our foreign policies" had alienated the Muslim population, that we had "gone after the wrong people" and inflamed moderates. And "that inflammation then gets organized and appears as this disaster in Bombay."

All this was a bit too much, evidently, for CNN interviewer Jonathan Mann, who interrupted to note that there were other things going on -- matters like the ongoing bitter Pakistan-India struggle over Kashmir -- which had caused so much terror and so much violence. "That's not Washington's fault," he pointed out.

Given an argument, the guest, ever a conciliator, agreed: The Mumbai catastrophe was not Washington's fault, it was everybody's fault. Which didn't prevent Dr. Chopra from returning soon to his central theme -- the grave offense posed to Muslims by the United States' war on terror, a point accompanied by consistent emphatic reminders that Muslims are the world's fastest growing population -- 25% of the globe's inhabitants -- and that the U.S. had better heed that fact. In Dr. Chopra's moral universe, numbers are apparently central. It's tempting to imagine his view of offenses against a much smaller sliver of the world's inhabitants -- not so offensive, perhaps?

It takes a seriously twisted world view to pivot immediately to finding a way to blame America for terrorists storming hotels and other soft targets to gun down people innocently going about their business. Rabinowitz ties this view to the handwringing over a report that the majority of people in the Middle East think that 9/11 was a put-up job done by the United States and Israel.

The noteworthy point here was the writer's conclusion that the U.S. itself was to blame for the power of these beliefs. "It is easy for Americans to dismiss such thinking as bizarre," Mr. Slackman allowed. But that would miss the point that the persistence of these ideas represents the "first failure in the fight against terrorism." A U.S. failure? Nowhere in the extended list of root causes here was there any mention of the fanaticism and sheer mindless gullibility that is the prerequisite for the holding of such beliefs.

Its very ordinariness speaks volumes about this report. A piece written with evident serenity, the perversity of its conclusions notwithstanding, it's one emblem among many of the adversarial view of the nation that is today entrenched in the culture. So unworthy is the U.S. -- an attitude solidly established in our media culture long before the war on terror -- that only it can be held responsible for the deranged fantasies cherished in large quarters of the Arab world. So natural does it feel, now, to hold such views that their expression has become second nature.

I'm with Mark Steyn who argues that the source of the terror is a radical Muslim ideology that seeks to impose itself on the world at the end of a machine gun. We're fooling ourselves if we ignore this and try to search for some other cause or, even worse, find ways to blame ourselves.

What's relevant about the Mumbai model is that it would work in just about any second-tier city in any democratic state: Seize multiple soft targets and overwhelm the municipal infrastructure to the point where any emergency plan will simply be swamped by the sheer scale of events. Try it in, say, New Orleans. All you need is the manpower.

Given the numbers of gunmen, clearly there was a significant local component. On the other hand, whether or not Pakistan's deeply sinister spy agency ISI had its fingerprints all over it, it would seem unlikely there was no external involvement. After all, if you look at every jihad front from the London Tube bombings to the Iraqi insurgency, you'll find local lads and wily outsiders: That's pretty much a given.

But we're in danger of missing the forest for the trees. The forest is the ideology. It's the ideology that determines whether you can find enough young hotshot guys in the neighborhood willing to strap on a suicide belt or (rather more promising as a long-term career) at least grab an AK and shoot up a hotel lobby. Or, if active terrorists are a bit thin on the ground, whether you can count at least on some degree of broader support on the ground.

You're sitting in some distant foreign capital but you're minded to pull off a Bombay-style operation in, say, Amsterdam or Manchester or Toronto. Where would you start? Easy. You know the radical mosques, and the other ideological front organizations. You've already made landfall.

It's missing the point to get into debates about whether this is the "Deccan Mujahideen" or the ISI or al Qaeda or Lashkar-e-Taiba. That's a reductive argument. It could be all or none of them.

The ideology has been so successfully seeded around the world that nobody needs a memo from corporate HQ to act: There are so many of these subgroups and individuals that they intersect across the planet in a million different ways. It's not the Cold War, with a small network of deep sleepers being directly controlled by Moscow. There are no membership cards, only an ideology.

Read the description of how the terror progressed in Mumbai and you realize how little prepared the city was for any sort of concerted attack.

The two gunmen moved along two separate paths toward the station's main entrance, firing as they walked. They met virtually no resistance, even though several dozen police officers are usually deployed at the station. "They were killing the public, and the police just ran away," says Ram Vir, a coffee vendor whose stand is near Platform 8.

B.S. Sidhu, head of the Railway Protection Force for the Mumbai region, says that while some officers tried to fight back, there was little his force could do. Most police officers at the station -- as they are throughout India -- were unarmed or carried only bamboo sticks known as lathis. More than 40 people, including three police officers, were killed in just a few minutes, authorities said. The wounded survivors screamed for help amid acrid smoke, piles of slumped, bloodied bodies and spilling suitcases.

Gee, you think arming policemen might be a good start?

It's a horrific story of how these terrorists went methodically from location to location shooting people.

On the 20th floor, the gunmen shoved the group out of the stairwell. They lined up the 13 men and three women and lifted their weapons. "Why are you doing this to us?" a man called out. "We haven't done anything to you."

"Remember Babri Masjid?" one of the gunmen shouted, referring to a 16th-century mosque built by India's first Mughal Muslim emperor and destroyed by Hindu radicals in 1992.

"Remember Godhra?" the second attacker asked, a reference to the town in the Indian state of Gujarat where religious rioting that evolved into an anti-Muslim pogrom began in 2002.

"We are Turkish. We are Muslim," someone in the group screamed. One of the gunmen motioned for two Turks in the group to step aside.

Then they pointed their weapons at the rest and squeezed the triggers.

These are not rational people who decided that they were just fed up with Bush or America. It makes no difference to them that America has elected a president who had a Muslim father.

India will have to wake up and think about arming its police and making sure that its military knows how to fight such terrorist attacks. And we'll all have to rededicate ourselves to fighting this radical ideology and the terrorists it inspires.

Labels: War on Terror

posted by Betsy Newmark permalink 6:25 AM 7 comments

Saturday, November 29, 2008

The decline of the Golden State

 

Joel Kotkin has a depressing, but perceptive article about the decline of California in the last quarter century. If you want to know what is possible for the rest of the country if we institute the liberal agenda of increased regulation on businesses plus higher taxes, more catering to the unions, and total lack of fiscal responsibility, then look to California.

However, the real problems did not ultimately reside with the brash, creative, and sometimes unpredictable young governor himself. Entrenched Democratic interest groups, particularly public employees, resisted property tax relief for California’s middle-class homeowners. Ultimately, this failure brought about the passage of Proposition 13, a strict limit on property taxes that would sharply curtail infrastructure spending and reduce the ability of local governments to address serious problems.

During Brown’s watch, and even despite his occasional opposition, the Democratic Party came increasingly under the sway of public employees, trial lawyers, and narrow interest activist groups. Their ability to raise money and impose their political will often outweighed that of even the most powerful business interests.

The full bill for this transformation would eventually be paid not by Brown, but by his former chief of staff, Gray Davis. Becoming governor in 1998, Davis became the prisoner of the special interest groups with whom his predecessors, Deukmejian and Wilson, had struggled.

By then, California’s shift to the Democrats had become inexorable and, with the fading of a GOP counterweight, influence within the party flowed to its more radical factions further to the political left. As a result, the state moved decisively away from the economic growth focus of Pat Brown. It seemed determined to wage war against its own economy. As pet social programs, entitlements, and state employee pensions soared, infrastructure spending—the hallmark of the Pat Brown regime and once 20 percent of the state budget—shrank to less than 3 percent.

The educational system, closely aligned with the Democrats in the legislature, accelerated its secular decline. Once full of highly skilled workers, California has become increasingly less so. For example, California ranks second in the percentage of its 65-year-olds holding an associate degree or higher and fifth in those with a bachelor’s degree. But when you look at the 25-to-34 age group, those rankings fade to 30th and 24th.

Instead of reversing these trends, the state legislature decided to spend its money on public employees and impose ever more regulatory burdens on business. Davis, a clever and experienced public servant, understood this but could not fight the zealots in his own party. When the state’s revenues shrank after the high-tech bust in 2000, he appeared to be their complete captive. Perhaps the most telling example of the misplaced priorities of the state’s majority party took place amid the state budget crisis when legislators, facing an imminent fiscal disaster, took time to debate legislation about providing more protections for transgender Californians.

As Kotkin details, the election of Arnold Schwarzenegger might have offered some brief hope to role back the state's decline, but after a failed attempt to reform the system, he's wimped out and become as much of a girlie man as the politicians he once derided.

The Terminator and his advisors also never understood the economic rot undermining the state. The governor assumed little could be done to preserve manufacturing, warehousing, and other high-paying blue-collar jobs in California. Instead, he bought the idea that “creative” professionals in technology, finance, and entertainment could keep the state economically vibrant.

As pet social programs, entitlements, and state employee pensions soared, infrastructure spending shrank drastically.

....Worst of all, the governor’s economic team did not see the danger of the state’s growing reliance on the real estate bubble. According to my colleagues at the Praxis Strategy Group and others, as much as 50 percent of the state’s job growth in the 2000s relied on an inflated property market. It worked for a time, keeping many people—investors, homeowners, construction workers, financial types—gainfully employed and the state, for a while, solvent. A better-informed governor might have known it would all unravel. Indeed, in early 2007, even as it was clear that the bubble was deflating, Schwarzenegger continued to play vaingloriously to the klieg lights, promoting California as “the harmonious state, the prosperous state, the cutting-edge state … a model not just for 21st-century American society, but the world.”

Instead of addressing the fundamental fiscal and economic problems, the governor preened for the local and national media by making California the focal point for addressing global climate change. He also proposed a gigantic $14 billion healthcare program largely funded by a state that has beleaguered smaller businesses.

Fiscal reality scuttled the healthcare plan, but business is still trying to figure out how to cope with a carbon regime faced by few of their competitors. Meanwhile, California’s unemployment is now over 7.3 percent, fourth worst in the nation, behind only Michigan, Mississippi, and Rhode Island.

Not happy company for a state that was once touted as a golden state of promise.

The politicians running the state have not had the fortitude to face the real challenges of reining in runaway pension and other entitlement costs that are becoming an unbearably heavy burden.

There is a slight sliver of hope now that California voters passed Proposition 11 which allows for a new redistricting commission designed to take redistricting out of the hands of politicians who gerrymander districts to preserve their incumbency. But it's a frail hope, and California would have to wait for the 2012 elections to see any change in their legislature. And it's a far jump from that to then seeing politicians elected who might be willing to stand up to the public employees union.

The greatest hope is that other states will learn from California's mistakes. Sometimes those laboratories of democracy can provide salutary lessons of what not to do.

Labels: Economics

posted by Betsy Newmark permalink 10:10 AM 12 comments

Friday, November 28, 2008

Poor, poor Barack

 

The Washington Post ran an article about how tough it is going to be for Barack Obama to transition to the public sort of fishbowl existence that he will have as president. He won't be able to take run sin the neighborhood or just go and hang out in his Hyde Park neighborhood. And he'll have to live full time in Washington D.C., not a city he particularly likes.

Well, obviously, the Obamas decided that it was worth it to give up the normalcy of their lives for a life lived on the public stage. No one forced him to run for the presidency. And, let's face it, there are also major perks to living in the White House. They might not be able to pop out to restaurants as much as they might like, but they have a whole staff of chefs to prepare their favorite meals.

So spare us all the sad stories about how tough it is for the Obamas to adjust to their new public lifestyle and keep up with old friends. There are tradeoffs in all of life's choices and the Obamas could not have been in ignorance of what was involved in their decision to run for high public office.

Labels: President Obama

posted by Betsy Newmark permalink 11:02 AM 14 comments

Happy Thanksgiving!

 

I hope that all my readers had a lovely Thanksgiving celebrated with those who mean the most to you.

posted by Betsy Newmark permalink 9:45 AM 1 comments

Tuesday, November 25, 2008

Are we tough enough to deal with pirates?

 

Bret Stephens writes today about the situation with the Somali pirates and how we're so much more hamstrung today in fighting piracy than we were in the 19th century when we defeated the Barbary pirates.

Year-to-date, Somalia-based pirates have attacked more than 90 ships, seized more than 35, and currently hold 17. Some 280 crew members are being held hostage, and two have been killed. Billions of dollars worth of cargo have been seized; millions have been paid in ransom. A multinational naval force has attempted to secure a corridor in the Gulf of Aden, through which 12% of the total volume of seaborne oil passes, and U.S., British and Indian naval ships have engaged the pirates by force. Yet the number of attacks keeps rising.

Why? The view of senior U.S. military officials seems to be, in effect, that there is no controlling legal authority. Title 18, Chapter 81 of the United States Code establishes a sentence of life in prison for foreigners captured in the act of piracy. But, crucially, the law is only enforceable against pirates who attack U.S.-flagged vessels, of which today there are few.

What about international law? Article 110 of the U.N.'s Law of the Sea Convention -- ratified by most nations, but not by the U.S. -- enjoins naval ships from simply firing on suspected pirates. Instead, they are required first to send over a boarding party to inquire of the pirates whether they are, in fact, pirates. A recent U.N. Security Council resolution allows foreign navies to pursue pirates into Somali waters -- provided Somalia's tottering government agrees -- but the resolution expires next week. As for the idea of laying waste, Stephen Decatur-like, to the pirate's prospering capital port city of Eyl, this too would require U.N. authorization. Yesterday, a shippers' organization asked NATO to blockade the Somali coast. NATO promptly declined.

Then there is the problem of what to do with captured pirates. No international body similar to the old Admiralty Courts is currently empowered to try pirates and imprison them. The British foreign office recently produced a legal opinion warning Royal Navy ships not to take pirates captive, lest they seek asylum in the U.K. or otherwise face repatriation in jurisdictions where they might be dealt with harshly, in violation of the British Human Rights Act.

This situation can't continue. Nations that rely on shipping need to get together and figure out a way to handle pirates other than just trying to avoid them. With no government in Somalia, it is a haven for such pirates plus Al Qaeda-like terrorists. We can't afford to be tied down like Gulliver with outdated laws never meant to deal with today's situation. All of these countries need to rewrite their laws to facilitate the fight against this piracy rather than being afraid of actually capturing the bad guys. As Stephens says,

A society that erases the memory of how it overcame barbarism in the past inevitably loses sight of the meaning of civilization, and the means of sustaining it.

Labels: Foreign Policy

posted by Betsy Newmark permalink 7:21 AM 13 comments

Voting against 60 Democrats in the Senate

 

Meanwhile, in the Georgia contest, Michael Barone points out that Saxby Chambliss could benefit in his runoff election from perceptions that the Democrats are even closer to getting to 60 votes in the Senate. There is a small percentage of voters who support his opponent, but tell Rasmussen pollsters that they are less likely to vote for Jim Martin, the Democrat, if they think that will give the Democrats 60 votes in the Senate. And Barone posits that Chambliss will benefit from the confusion in the Minnesota recount that guarantee that whether or not Norm Coleman or, Lord help us, Al Franken will represent Minnesota in the Senate.

This suggests that Chambliss stands to do better (a) if the Minnesota race is decided for Democrat Al Franken on or before December 2 or (b) if the Minnesota winner is undetermined December 2 than (c) if Republican Norm Coleman is declared the winner by that time. Since it seems like the Minnesota race will not be decided until well after December 2, it looks like the don't-let-them-get-60 argument will help Chambliss.

Labels: Senate

posted by Betsy Newmark permalink 6:52 AM 1 comments

Aggravating Susan Collins

 

The Hill reports that Susan Collins, who, along with her colleague Olympia Snowe, voted with the Democrats more than any other Republican senators, is aggravated with her Democratic colleagues who campaigned against her for reelection. And she's telling people that she still feels resentful that her Democratic senatorial colleagues came to Maine to criticize her as just a Bush clone.

Collins told colleagues at a small Senate prayer breakfast meeting last week that she still felt lingering resentment toward Democratic senators who campaigned against her in Maine.

She confessed that she had “trouble forgiving colleagues” who traveled to Maine and told voters she was “a Bush clone and called into question her ethics,” said a senator who attended the meeting.

Collins’s lingering resentment could emerge as a snag for Democratic leaders who expect her to side with them on many important votes.

Unless Democrats win a recount in Minnesota and a runoff in Georgia, Senate Majority Leader Harry Reid (D-Nev.) will need at least two Republicans to side with his conference on procedural votes next year to overcome GOP filibusters.

Collins’s spokesman, Kevin Kelley, said his boss does not hold a grudge.

“She has made clear that once the campaigns are over, politics needs to be set aside and Congress needs to get the job done,” Kelley said. “That’s something Sen. Collins has always done and something she’ll continue to.”

But other senators say that attacks on the campaign trail can have lasting repercussions in the clubby Senate, where one lawmaker’s objection can bring legislative progress to a halt.

Collins and Snowe always portray themselves as voting their beliefs rather than their party. It would be rather immature to change their votes just because they're angry about the way the campaign played out. Our representatives aren't supposed to vote their pique, though I suppose many do. It's rather like Newt Gingrich complaining about which exit he had to use on Air Force One.

Though it's rather notable that her Democratic colleagues would so strongly badmouth a mild and moderate senator like Collins, especially when it was never in doubt that she was cruising to victory. She won her reelection 61 to 39% with a bigger margin than even Barack Obama. So she has some room to vote her true beliefs, resentments aside. We'll see how that plays out.

Labels: Senate

posted by Betsy Newmark permalink 6:40 AM 4 comments

The French language police

 

Finding herself behind in the polls, the separatist Parti Québécois leader Pauline Marois is pushing for a strong version of the French language law that has driven so many English speakers away from Quebec.

The new law would require smaller businesses with up to 50 employees to operate in French.

Currently, only those with more than 50 employees are subject to the rule.

Former PQ language minister Louise Beaudoin, who is a candidate in this election, said new immigrants would be expected to learn French, and, after three years, the government would only communicate with them in French.

The Liberal government of Jean Charest "talks and does nothing" about the apparent diminution of French in Montreal, Marois said.

Imagine having a country with a "language minister." What a way to drive businesses from your community if you start telling them what language they need to operate in.

I know that there are many in America who would like to see laws enacted making English the official language, but I would hate to see us having a "language minister." I wish that every immigrant would work hard to master English. The best way to do that is to immerse their children in English at school, not separatist bilingual programs that prolong their lack of fluency in English. Provide free or cheap ESL classes for the adults. But let us not start passing laws like Quebec where they have language police measuring the size of French in store signs compared to the English.

Labels: Education

posted by Betsy Newmark permalink 6:25 AM 5 comments

Monday, November 24, 2008

Charlie Rangel - Tax Scofflaw

 

Oh, that Charlie. First we learned that he wasn't paying taxes on his property in the Dominican Republic. Then we learned that he had four, count them, four rent controlled appartments in New York City. Now we learn that he's been too clever by half in the tax exemptions that he's claimed for his home in the District of Columbia.

Rent laws in New York City and the state require that tenants occupying rent-stabilized apartments use those units as their primary residences. At the same time, the District of Columbia’s Office of Tax and Revenue extends the homestead tax deduction only to properties that are primary residences.

The internal review by Mr. Rangel’s legal team was prompted by a report in Sunday’s edition of The New York Post quoting a District of Columbia tax official as saying that Mr. Rangel received a homestead tax exemption for a four-bedroom home he owned in Washington. The official told the newspaper that the congressman received the tax exemptions from 1995 through 2000, when he also had the use of rent-stabilized apartments in his district in Harlem.

It's hard to claim that the District of Columbia is your primary representative when you're also claiming to be a resident of Harlem in order to run for Congress.

The DC rules state that "by maintaining a residence in his home state and actively voting there, [a member of Congress] is demonstrating that he continues to be a part of the body politic of his home state . . . The Member is a domiciliary of his home state. Because he is not domiciled in the District, the Member cannot claim the District's homestead deduction."

Said Natasha Altamirano, a spokeswoman for the National Taxpayers Union, "If a member of Congress maintains his or her principal residence in the state they represent, they would not qualify for the homestead exemption."

Meanwhile, the New York City Rent Stabilization Code states that its rules do not apply to "housing accommodations which are not occupied by the tenant . . . as his or her primary residence."

Dov Treiman, a Manhattan real-estate attorney, said, "If the [rent-stabilized] apartment in New York is not your primary residence, the landlord has the right to bring a court proceeding to have you evicted."

Patricia Wagner, special-programs manager in the Assessment Services Division of the DC Office of Tax and Revenue, confirmed to The Post that Rangel received a homestead tax deduction for his quarter-acre, four-bedroom property on Colorado Avenue.

The agency would not allow The Post to view original tax documents, such as Rangel's applications, despite repeated requests.

However, Wagner provided spreadsheets showing Rangel's reduced tax bills for the years 1995 through 2000, along with this written statement: "According to records . . . the subject account received the homestead benefit for the tax years provided in the report."

Gee, just the type of guy we want being in charge of the House Ways and Means Committee and writing our tax laws.

At first, Rangel blamed the accounting mishaps on sloppy bookkeeping and his wife, who he said was in charge of the family's finances. He also said he did not receive regular financial reports from the Punta Cana Resort and did not understand the paperwork because it was in Spanish.

Amid calls for him to give up his position as chairman of the Ways and Means Committee, Rangel promised in September to hire a forensic accountant to scour his tax returns and financial disclosures and to present the results to the Ethics Committee. After The Post reported on Nov. 2 that he had not yet hired a CPA, a spokesman for Rangel announced that he finally did so on Nov. 9.

In addition to the rental income from the villa and his use of the four rent-stabilized Harlem apartments, the committee is investigating Rangel's use of congressional stationery to solicit funds for a City University of New York academic center named after him, and his use of a free parking spot in an underground House of Representatives parking lot to store his vintage Mercedes-Benz for an undisclosed number of years.

The Democrats don't seem all that hot to trot to remove a guy with multiple tax violations and other ethical questions from one of the most powerful positions in the House, do they?

Next time you get a call from the IRS for an audit, try those forgetting to hire a CPA or my wife is to blame excuses and see how well they fly.

Labels: Congress

posted by Betsy Newmark permalink 12:50 PM 5 comments

Don't they ever learn?

 

The Screen Actors Guild is threatening another strike. Here the economy is in the tank and they are looking to leverage more money from internet productions for their union members. Movie producers are already worried at how a recession will impact movie ticket sales. And now to throw an actors' strike into the mix? When people are concerned about blue collar workers losing their jobs as the auto companies collapse, are we supposed to be concerned about actors? What lousy timing.

Labels: Economics

posted by Betsy Newmark permalink 7:11 AM 5 comments

This is why we have those "laboratories of democracy"

 

Bobby Jindal is demonstrating what an innovative and intelligent governor can do by proposing a new Medicaid policy for Louisiana. He is taking a more free market policy towards health care rather than just shelling out government dollars.

Governor Jindal plans to steer working-poor Medicaid recipients out of the current "fee for service" program, where the state pays a set rate for all health-care charges (some 54 million this year). Instead, they'd choose among private managed-care plans, with Louisiana paying a fixed per-patient amount, adjusted for health risks. Essentially, Mr. Jindal wants to use Medicaid dollars to fund something like private insurance. That way, physicians and hospitals will be compensated for outcomes -- rather than volume of visits and procedures -- and get incentive payments for good performance.

Such a "defined contribution" plan is one way to wrestle run-amok health costs back under control and spend more responsibly. It isn't a new idea, but it is a good one. Congressional Republicans passed a similar reform in 1995 for Medicare, which Bill Clinton vetoed -- only to have his own bipartisan commission endorse it in 1999.

If he gets the federal waiver that he needs to change the delivery of Medicaid, we'll have an opportunity to see if his plan works as planned.

I'm covering the advantages and disadvantages of federalism today in my government class and one of the important points for them to absorb is the value of having different states try out different policies so we can get a real-life view of the success or failure of those policies. Jindal is going to be providing us a textbook example of such experimentation.

This is why many conservatives are much more interested in Jindal's political future than Sarah Palin. While she garners the celebrity attention, he's plugging away at a whole world of problems in Louisiana and testing whether conservative policies can address those problems. And it provides even more substance to Chris Cillizza's list of hot Republicans to watch and his choice to put Jindal as the number one hot Republican while Sarah Palin doesn't even make the cut.

Labels: Bobby Jindal, Health

posted by Betsy Newmark permalink 6:52 AM 8 comments

Don't learn the wrong lessons from the New Deal

 

Economist Tyler Cowen reminds us of how the New Deal didn't fix the Great Depression. These are lessons that we can all hope that the new administration is paying attention to.

GET THE SMALL THINGS RIGHT It’s not just monetary and fiscal policies that are important. Roosevelt instituted a disastrous legacy of agricultural subsidies and sought to cartelize industry, backed by force of law. Neither policy helped the economy recover.

He also took steps to strengthen unions and to keep real wages high. This helped workers who had jobs, but made it much harder for the unemployed to get back to work. One result was unemployment rates that remained high throughout the New Deal period.

Today, President-elect Barack Obama faces pressures to make unionization easier, but such policies are likely to worsen the recession for many Americans.

DON’T RAISE TAXES IN A SLUMP The New Deal’s legacy of public works programs has given many people the impression that it was a time of expansionary fiscal policy, but that isn’t quite right. Government spending went up considerably, but taxes rose, too. Under President Herbert Hoover and continuing with Roosevelt, the federal government increased income taxes, excise taxes, inheritance taxes, corporate income taxes, holding company taxes and “excess profits” taxes.

When all of these tax increases are taken into account, New Deal fiscal policy didn’t do much to promote recovery. Today, a tax cut for the middle class is a good idea — and the case for repealing the Bush tax cuts for higher-income earners is weaker than it may have seemed a year or two ago.

Ben Bernanke probably knows more about the mistakes that the Fed made during the Great Depression than any other expert so we don't have to worry that he will make those monetary mistakes again, but it is really the mistakes that the politicians can make that we have to worry about. The Fed has loosened monetary policy almost as much as can be done and things still look bad. Imagine if we added in tax increases at this time.

We will make our own new mistakes, but there is no reason to repeat the same errors that FDR's administration made. Imagine how Obama could soothe the uncertainties roiling the markets if he announced ahead of time that taxes were off the table and that he was going to "delay" any repeal of the Bush tax cuts on higher-income earners.

Labels: Economics, History

posted by Betsy Newmark permalink 6:33 AM 3 comments

A headline that Obama voters will need to get used to

 

President-elect Obama is planning to "delay" one of his campaign promises - to repeal the "Don't ask, don't tell" policy for the armed forces.

President-elect Barack Obama will not move for months, and perhaps not until 2010, to ask Congress to end the military's decades-old ban on open homosexuals in the ranks, two people who have advised the Obama transition team on this issue say.

Repealing the ban was an Obama campaign promise. However, Mr. Obama first wants to confer with the Joint Chiefs of Staff and his new political appointees at the Pentagon to reach a consensus and then present legislation to Congress, the advisers said.

What a novel idea - to confer with those most expert in a policy before implementing it! And then to want to reach a consensus rather than an edict from the One.

He's smart to avoid the brouhaha that erupted when President Clinton chose to make this one of his first policy changes in 1993 and everyone got distracted from by that fight. Obama is showing that he can learn from others' mistakes.

Whether his supporters are willing to accept delay on yet another of his campaign promises is another story. Right now they seem ready to cut him slack as he fills his administration with former Clintonites, even Hillary Clinton herself, toys with keeping on Bush's Secretary of Defense, forgives Joe Lieberman, and delays promises about an immediate pullout from Iraq.

But the netroots will have to get used tothe fact that the election of Barack Obama might be the worst thing that could have happened to their influence. They might rage against some of his changes, but as long as Obama has the support of the MSM he's not going to be worried much about some disgruntled voices on the extreme left.

Labels: President Obama

posted by Betsy Newmark permalink 6:08 AM 4 comments