Right Thinking From The Left Coast
Reality is merely an illusion, albeit a very persistent one. - Albert Einstein

Wednesday, October 01, 2008

McKinney’s Insanity

Where would we be in this election cycle without batshit crazy Cynthia McKinney, claiming the government murdered 5,000 prisoners during Katrina:

I was a remote part of the evil Zionist running dog Jewish cabal that twice blasted Cynthia out of office in the Democratic primaries.  If only we could deport her, too.

Posted by Hal_10000 on 10/01/08 at 11:19 AM in Left Wing Idiocy  • (0) TrackbacksPermalink

The Economists Blink

You remember those economists who signed a letter opposing the bailout plan?  Well, it turns out that they didn’t oppose it completely, they just wanted a better bill than the piece of shit Paulson was trying to force down our throats.  And they’re a bit peeved that Congress dropped the ball.

I talked to a large number of economists in the wake of Congress’s decision to trash the (heavily revised) bailout plan. Responses — from those on both the left and the right — ranged from anger to bewilderment to frustration at what is quite clearly cheap election-year politicking on an issue that should be bigger than re-election.

Here’s a particularly pointed exchange in which a fellow economist wrote to a congressman, attempting to change these political calculations:

I made a donation to Congressman Grijalva’s campaign earlier this year, at a house party. After hearing that Congressman Grijalva voted against the bailout, I would like my money back. This was a time to make a courageous vote; one that was in the best interests of the Congressman’s constituents, even if many didn’t realize it. If a member from a safe district like yours can’t be counted on to show leadership and do the right thing, it’s no wonder that someone like Giffords (my rep, for whom I will now not vote) wouldn’t. The stakes are way too high for this stuff.

Please return my contribution. … Please also take me off your mailing list, as I won’t be interested in supporting Congressman Grijalva in the future.

Of course, their opinion didn’t matter to some of our leaders before (scroll all the way down to Quotes of the Week).  I expect it to matter less now.

Update: Speaking of economists, read King Banaian’s commentary:

The “free market” did not get us into this mess, but we need the free market to get us out.  For that to happen, the free market needs government as a partner, whether conservatives like that idea or not.

Free markets have always had booms and busts.  This is the nature of Schumpeter’s “creative destruction,” of which some think this crisis is just another example.  Some think this would be good for our economy.

They are wrong.  Those who see in the current crisis only creative destruction underestimate the dose of simple destruction – as in a bomb going off – we are facing, and the magnitude of that destruction.

In creative destruction the boom that follows the bust needs to have credit to stoke its engines.  The genius of capitalism is the movement of capital from the investor who seeks returns to the entrepreneur whose new innovation will help drive the next boom.

The current crisis threatens the engine of capitalism – finance – and hence we cannot sit idly by as the crisis deepens.

It’s one of the best pro-market defense of the bailout I’ve read.

Posted by Hal_10000 on 10/01/08 at 11:06 AM in Politics  • (0) TrackbacksPermalink

Credit

George Will:

We are waist deep in evasions because one cannot talk sense about the cultural roots of the financial crisis without transgressing this cardinal principle of politics: Never shall be heard a discouraging word about the public.

Concerning which, a timeless political trope is: Government should budget the way households supposedly do, conforming outlays to income. But the crisis came partly because so many households decided that it would be jolly fun to budget the way government does, hitching outlays to appetites.

Beneath Americans’ perfunctory disapproval of government deficits lurks an inconvenient truth: They enjoy deficits, by which they are charged less than a dollar for a dollar’s worth of government. Conservatives participate in this, even though deficits fuel government’s growth by obscuring its cost.

The people can emulate the government because credit has been democratized. Democratization of everything is supposedly an unquestionable good, but a blizzard of credit cards (1.5 billion of them, nine per cardholder), subsidized loans and cheap money has separated the pleasure of purchasing from the pain of paying. Furthermore, the entitlement mentality fostered by the welfare state includes a felt entitlement to a standard of living untethered from savings.

Populism flatters the people, contrasting their virtue with the alleged vices of some minority—in other times, Jews or railroad owners or hard money advocates; today, the villain is “Wall Street greed,” which is contrasted with the supposed sobriety of “Main Street.” When people on Main Street misbehave by, say, buying houses for more than they can afford to pay, they blame the wily knaves who made them do it, such as the “nimble” Babbitt.

One of the memes I am tiring of is the idea that our current fiscal woes are entirely the product of the Community Reinvestment Act, Fannie, Freddie, poor borrowers and the evil Democrats. Yes, they deserve a huge amount of the blame.  But it wasn’t they who came up with house flipping, credit default swaps and bundled mortgage securities.

I think Will taps into the wider issue—the pig-headed belief that we are entitled to keep up with the Jones’ while earning like the Smiths.  We believe that people with bad credit are entitled to homes, that people with decent credit are entitled to mansions and that all of us are entitled to cheap gas and a big TV.  And of course, there is the apotheosis of this thinking—the idea that government can grow and grow and grow while taxes shrink and shrink and shrink.

I just wish our Presidential candidates would be more honest about it.

Posted by Hal_10000 on 10/01/08 at 11:00 AM in Politics  • (0) TrackbacksPermalink
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