Pardon me for a little rank speculation, but if W. had used this bit of news to promote a stimulus policy he would have been mocked in the press incessantly for trading on fear, or thinking small, or for using not-so-subtle political blackmail.
No way to prove it of course, but does anyone agree?
2/10/2009
When Geithner Speaks, People Listen
There are three uniquely unfalsifiable and inflammatory techniques of political debate that give me a five alarm headache whenever I hear them:
1) When one potential beneficiary of a policy is plucked from a population of 300,000,000 as evidence the proposal is a good one. No kidding, this or that idea will benefit this or that person? Amazing. Big whoop. Show me why the idea is good for 200,000,000 people.
2) "Do it for the children." Somehow children survived and thrived for decades without politicians falling all over themselves to show just how much they care about "the children." I have kids, I know lots of kids, and as a society we've helped them so much they can barely tie their shoes without a liability release form.
3) Pointing to the daily moves of the Dow as either affirmation or refutation of a policy's success. Daily market movements are, with rare exception, totally random. No one knows enough to outguess the market daily, let alone comment on it cogently. If someone did, there would be no reason to hold a job.
All that said, I sure feel bad for Treasury Secretary Geithner. As he spoke today, Mr. Market took a giant leap off a cliff. His boss couldn't possibly be Hoping for that kind of Change.
1) When one potential beneficiary of a policy is plucked from a population of 300,000,000 as evidence the proposal is a good one. No kidding, this or that idea will benefit this or that person? Amazing. Big whoop. Show me why the idea is good for 200,000,000 people.
2) "Do it for the children." Somehow children survived and thrived for decades without politicians falling all over themselves to show just how much they care about "the children." I have kids, I know lots of kids, and as a society we've helped them so much they can barely tie their shoes without a liability release form.
3) Pointing to the daily moves of the Dow as either affirmation or refutation of a policy's success. Daily market movements are, with rare exception, totally random. No one knows enough to outguess the market daily, let alone comment on it cogently. If someone did, there would be no reason to hold a job.
All that said, I sure feel bad for Treasury Secretary Geithner. As he spoke today, Mr. Market took a giant leap off a cliff. His boss couldn't possibly be Hoping for that kind of Change.
2/09/2009
The Truth Hurts, Senator
We now have Sen. Patrick Leahy (D-VT) calling a "Truth and Reconciliation Commission" to investigate decisions of the Bush Administration. If the Senator were not serious, we would all be doubled over with a good belly laugh. Due to his own history, Mr. Leahy would be best to take the advise of his far left colleagues and "Move On."
Since Sen. Leahy doesn't care to move on, maybe we should have a commission review his misdeeds. Better yet, we should have the US Attorney investigate them. It is ironic that Sen. Leahy would be the one Senator calling for a commission to investigate so called misdeeds by the prior administration since, as a member of the Senate Intelligence Committee, he leaked information that made have led to the death of a covert American intelligence agent in Egypt. According to a 1987 San Diego Union-Tribune report, in a 1985 television appearance, Mr. Leahy disclosed classified information that one of Egyptian President Hosni Mubarak's telephone conversations had been intercepted. The information that Leahy revealed had been used in the operation to capture the Arab terrorists who had hijacked the Achille Lauro cruise ship and killed American citizens. The Union-Tribune claimed that Leahy's indiscretion may have cost the life of at least one of the Egyptian operatives involved in that operation.
There is no question that the leaking of classified intelligence information is a felony. Therefore, if one of the operatives involved in the capture of the Achille Lauro terrorist was murdered as a result of Sen. Leahy's leak, the Senator is guilty of felony murder. This is the perfect topic for a commission, or at least a grand jury.
But wait, there is more. Senator Leahy evidently thought that he was solely empowered to declassify any information that he wanted. In 1987, the Washington Times reported that Leahy had also leaked secret information about a 1986 covert operation planned by the Reagan administration to overthrow Libyan dictator Moammar Gadhafi. Leahy allegedly had said, "I thought the operation was probably the most ridiculous thing I had seen, and also the most irresponsible." Leahy had threatened to expose the operation to then CIA Director William Casey. A few weeks later, details of the plan appeared in The Washington Post, and the operation was canceled. It is nice to see that the judgment of one Senator can override that of the entire national security apparatus.
And, just when you think it's over, Senator Leahy reappears for an encore. Just before the Iran-Contra hearings were to begin, Leahy allowed an NBC reporter to look through the Senate Intelligence Committee's confidential draft report on the burgeoning scandal. After NBC used the information in a January 1987 report, Leahy came under increasing fire, and after a six-month internal investigation he was finally forced to step down from the Intelligence Committee. This leak was considered to be one of the most serious breaches of secrecy in the Intelligence Committee's then-10-year history.
If Senator Leahy's Senate colleagues had a moral compass, they would have expelled him from the Senate. Next, they would have demanded that he be prosecuted and sent to jail. Then, not only would Sen. Leahy have received the punishment that he deserved, the prosecution would have acted as a deterrent to future leakers of classified information. Maybe the New York Times would never have known about the the terrorist surveillance program or our efforts to stop the international financing of Islamic terrorists. Instead, Senators and bureaucrats leak with impunity and repeatedly compromise our security.
Sen. Leahy is a far left zealot who is not worthy of the office that he holds. The people of Vermont should have realized this a long time ago. The true lesson for Mr. Leahy is that people in glass houses shouldn't throw stones!
We Agree!
Simply being politically or economically conservative does not make one the caricatured version, the one who cares little, if any, for the financial well-being of the less advantaged or those on the receiving end of terrible randomness. Some of us actually believe a country as wealthy as ours should provide food, shelter, health care, housing etc. to the genuinely screwed. Where we differ with our friends on the left is the extent to which recipients should expect the kindness of strangers enforced at gunpoint.
Public spending comes at a cost (i.e. taxation or borrowing). Sometimes that cost is overcome unambiguously (county builds a bridge, hotel gets built on other side of bridge, which generates jobs and taxes). Sometimes the reward isn't quantifiable but self-evident (think polio vaccinations). But disagreement will never end on what constitutes national priorities, the usefulness of funding to address them and subsequent questions of how, when, amounts and by whom.
Experience painfully teaches spending eventually becomes an expectation, nearly impossible to reverse even when the original problem no longer exists. There's nothing automatically bad about about resisting claims on the national purse, just as there's nothing automatically good about making claims on the purse. Personally, I agree with with Treasury Secretary Tim Geithner: "Public assistance is a privilege, not a right."
Sec. Geithner said that in the context of conditions on the compensation of senior executives at Treasury-assisted banks. But change the subject just a little to, say, middle class housing. Would Geithner's boss agree?
Public spending comes at a cost (i.e. taxation or borrowing). Sometimes that cost is overcome unambiguously (county builds a bridge, hotel gets built on other side of bridge, which generates jobs and taxes). Sometimes the reward isn't quantifiable but self-evident (think polio vaccinations). But disagreement will never end on what constitutes national priorities, the usefulness of funding to address them and subsequent questions of how, when, amounts and by whom.
Experience painfully teaches spending eventually becomes an expectation, nearly impossible to reverse even when the original problem no longer exists. There's nothing automatically bad about about resisting claims on the national purse, just as there's nothing automatically good about making claims on the purse. Personally, I agree with with Treasury Secretary Tim Geithner: "Public assistance is a privilege, not a right."
Sec. Geithner said that in the context of conditions on the compensation of senior executives at Treasury-assisted banks. But change the subject just a little to, say, middle class housing. Would Geithner's boss agree?
2/06/2009
Rewriting Reality
Alan Reynolds has a great column on National Review Online today taking Paul Krugman to task for his constant efforts to distort the economic benefits that resulted from Ronald Reagan's policies. Reynolds describes typical "Krugmanian" tactics such as defining the "Reagan era" as the period between 1977 and 1991. Correct me if I'm wrong, but I'm pretty sure Jimmy Carter was inaugurated in 1977, not Ronald Reagan. And from 1989-1991 George H.W. Bush was busy undoing some of Reagan's economic accomplishments (raising individual marginal tax rates in 1990 for example).
Krugman also uses a typical liberal economist's tactic of focusing on hard to define metrics such as wealth distribution and poverty rates to refute overwhelming evidence of economic progress. From January 20, 1981 to January 20, 1989, the S&P 500 increased by 120%. Real annual GDP growth averaged 3%, while inflation and interest rates were reduced dramatically, during Reagan's term. Yet, in Krugman's world, the 80's were a failure because the bulk of income gains went to the top 1% of income earners, while the rest of Americans were left behind. Leaving aside the fact that this was not true, as Reynolds proves, the bigger point is that the idea that policies can be implemented to target what income group gains the most is pure hubris. Politicians are most effective when they get out of the way and let the private market innovate and create growth. Efforts to micromanage and pick favorite groups to benefit from growth continually cause more problems than they solve.
Ronald Reagan's accomplishments are many, but chief among them is lowering the top marginal tax rate for individuals from 70% (yes, 70%!) to 28%, thus increasing incentives to work and innovate and unleashing the entrepreneurial spirits of Americans. Paul Krugman seems to be offended by policies that allow Americans to decide how to spend and invest their money, as opposed to the government. Thus he has been engaged in a twenty year quest to discredit Reagan's policies and accomplishments. As Alan Reynolds says at the end of his column, can we please recall Krugman's ill-deserved Nobel Prize?
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