Stromata Blog

NY-23

If you get your news and opinion from the standard left-wing gaggle, you “know” that the special election in New York State’s 23rd Congressional District proves that the Republican Party has become a narrow, reactionary clique. The proof is that a liberal Republican running in a three-way race fell to 20% in the polls and backed out. That showing was despite a furious effort on her behalf by the national GOP, which put something like four times as much money into the race as she had been able to raise herself.

Now, I can think of scenarios that would amount to a right-wing purge. Suppose, for instance, that a candidate were a mainstream member of the party except for a single issue, that the party’s ideological zealots funded a campaign against him centered on that issue, and the national party showed complete indifference. In other words, if Dede Scozzafava were the Republican counterpart to Joe Lieberman, it would make sense to say that her opponents were trying to purify the party and punish anyone who strayed from the approved line.

Unlike Senator Lieberman, though, candidate Scozzafava wasn’t a one-dogma heretic. The senator disagreed with the majority of his party only on the war in Iraq; he had, after all, been an orthodox enough Democrat to be awarded the Vice Presidential nomination. Dede Scozzafava, by contrast, is well to the left of the most liberal Republicans in Congress. Left-wing commentators have focused on her pro-abortion, pro-same-sex marriage positions, but she also supported the Obama pseudo-stimulus and card check legislation and had worked with ACORN fronts, while displaying no enthusiasm for any part of the conservative economic program.

The proof that Doug Hoffman’s campaign wasn’t orchestrated by narrow-minded social conservatives is that libertarians like Instapundit and Gay Patriot endorsed him. And what sank the Scozzafava effort wasn’t cliquish machinations but her inability to win over rank-and-file voters in the district. In the last pre-withdrawal poll, she was running 15 points behind the other two candidates. How did that happen if she was a “moderate who fits the district” and Hoffman a “right-wing extremist”?

Most of the high-profile conservative Republicans backing Hoffman stressed how unusual the NY-23 situation is. Not only was the official candidate an unambiguous liberal, but she had gained the nomination without a primary and had been involved in a highly embarrassing run-in with the press (when her husband sicced the police on an overly inquisitive reporter). There are no visible signs of a concerted effort to rid the party of genuine moderates. For instance, if Rep. Mark Kirk, one of the least conservative House Republicans, draws any challenge from the Right to his Illinois Senate bid, it’s a 99% certainty that his opponent won’t get nods from Fred Thompson or Sarah Palin or Tom Pawlenty or Rush Limbaugh.

Liberal talk of a “Republican civil war” is no more than a projection of their own dogmatism onto their opponents. Under Howard Dean, the Democratic Party was well on its way to scraping off its blue dog barnacles and becoming a fundamentalist Left faction. Rahm Emanuel was clever enough to halt that drift and recruit relative moderates for a large number of House seats in 2006 and 2008. Speaker Pelosi’s hard Left course, ignoring both the ideas and the electoral needs of the blue dogs, suggests that Mr. Emanuel’s tactical finesse didn’t survive his departure from the House. The real “ideological war” is and remains the drive by the leftmost fringe of the Democratic Party to impose and entrench undiluted liberalism, the philosophy of less than a quarter of the electorate, before the rest of the country wakes up and throws them out.

The Blago-Burris Seat

Notwithstanding the ingenious suggestions of various Volokh Conspiracy commenters, there are only two ways that the Senate can avoid seating Roland Burris. One is to persuade the Supreme Court to overrule Powell v. McCormack. That could happen, but liberals won’t be happy if it does. The rationale for the decision would almost certainly be the Political Question doctrine, the revival of which would be a severe setback for the Legal Left. I look forward hopefully to Justice Scalia’s majority opinion and to the NLG/ABA/AAJ gnashing of teeth thereafter.

The alternative is to persuade the appointee to back out, by making it clear to him that he will spend an unhappy two years as a gate crasher. The Democratic leadership has to let him take the oath of office, but they can’t be compelled to admit him to the party caucus or give him committee assignments and decent office space. Members can ignore his bills and refuse to let him co-sponsor their own. The presiding officer can overlook him when he tries to speak on the floor. The Democratic Senate Campaign Committee can announce that he will get no support in 2010. Faced with the choice between a prosperous lobbying practice in Springfield and pariah status in Washington, Mr. Burris can be expected to ease himself out of the picture. Bobby Rush might call the bluff and dare Harry Reid et al. to consign the lone black Senator to the back of the bus. Roland Burris won’t.

Jennifer Rubin has a series of astute observations [links omitted]:

Harry Reid better have a more compelling argument than “fraud” to keep Roland Burris out of the senate. For starters, where’s the evidence of “fraud” and is Reid accusing Burris of some misdeed? By their brilliant strategy of opposing a special election, the Democrats have now ensured an unseemly and protracted legal and political free-for-all.

President-elect Obama is predictably “disappointed.” That, you may recall, is the officially-approved default reaction.

Illinois Attorney General Lisa Madigan whines that Blago’s pick of Burris leaves the state in a “terrible situation.” Hmmm. How could this have been prevented? Someone ask Sen. Dick Durbin.

I agree that Reid’s got a tough case: it’s not enough to say Blago is a crook and was considering a list of other people for a price. Blago’s move, in a way, is a brilliant bit of misdirection, but it does undermine any insanity defense. This is one clever pol.

My favorite quip, though, is Jonah Goldberg’s: “Roland Burris is more qualified to be undemocratically appointed to the Senate than Caroline Kennedy is.” He heads that “Stating the Obvious”, and it is.

I’ll admit to feeling pangs of sympathy for the Senator-designate. Although his persona practically defines “lackluster”, his biography is inspirational (even if he does say so himself). He grew up as a young black man in downstate Illinois at a time when racial attitudes there were only marginally more enlightened than in Alabama and was elected to statewide office on an essentially nonracial basis. It’s a pity that his career will be remembered not for those achievements but for this twilight fiasco.

Further reading: John Kass, “For Sheer Brazenness, Nobody Surpasses Rod”

Room for India Under That Bus?

This year we have the largest ideological shift in the Presidency since Ronald Reagan was elected in 1980. A striking difference between then and now is that everybody had a reasonably clear idea of what President Reagan was going to do. He had not only run on a platform of “change”; he had specified what changes he had in mind: lower taxes, less government regulation, sound money, tough anticommunism. President-Elect Obama remains comparatively a riddle. What we saw during the past two years isn’t necessarily what we’re going to get.

Quite a few conservatives have been heartened by Obamindeterminacy. Given how far to the Left he campaigned, any uncollapsed quantum waves are almost bound to scatter to the Right of what we anticipated. But before we get our hopes too high. . . .

Immediately after being elected, Senator Obama started making phone calls to foreign heads of government. There is obvious symbolism to the order of these chit-chats. Hence, it is probably not happenstance that the Prime Minister of India was not an early recipient is almost certainly not happenstance. The omission has caused a stir in Asia.

Among the world’s democracies, India is first in population and third in gross domestic product. Though not formally an ally, it is one of America’s best friends in the Far East and a front line target of the mufsidun. It recently signed a nuclear cooperation treaty with the U.S., which is awaiting Senate ratification. Yet it didn’t even make the top fifteen on the President-Elect’s list. Asked about the “oversight”, one of Prime Minister Singh’s aides sounded, to my ears, just a little testy: “Of course, we are not in the same league as South Korea, Australia and New Zealand, and we are happy not to be.”

David Frum suggests, not implausibly, that this cosmetic downgrading of India is a prelude to more substantive slights:

The US wants fuller Pakistani cooperation against the Taliban in Afghanistan. The more motivated the Pakistani military is to help, the more successful (and less costly!) anti-Taliban operations will be.

Now what one thing could the US offer that would most strongly motive the Pakistani military? Answer: a pro-Pakistani tilt on Kashmir.

Such a tilt would compromise the important US long-term goal of developing a closer relationship with India. It would reward Pakistan for decades of state sponsorship of anti-India terrorism. But it could deliver some immediate results in Afghanistan – and that might be a trade that an administration that wishes to wriggle away from a campaign promise to send more troops to Afghanistan might be willing to make.

If so, it would be unsurprising that India would not receive an early call.

Before the election, the Indo-Asian News Service published an interview with the Democratic candidate, in which he waxed loftily about the importance of India as a “strategic partner”. But that may have been “just words”. His record brims with positions that could quickly cool relations with New Delhi, most notably his know-nothing denunciations of outsourcing. He was also an early critic of the U.S.-India nuclear pact, though he eventually came down in its favor. Perhaps, then, he ignored Mr. Singh simply because closer relations with India don’t fit the his vision of the ideal world.

Or perhaps he wasn’t thinking about anything in particular and this misstep is what we can expect from a President whose limitless confidence in his own abilities is founded on a slender base of knowledge and experience.

As with much else about our leader-to-be, we shall have to wait to find out.

Getting to Know You, Getting to Know All About You

Barack Obama may be an enigma to many, but Mr. Dow and Mr. Jones have given us their first impression of his Presidency, with the most impressive two-day stock market decline in 21 years. Why would anyone think, in the heady aftermath of his election triumph that the first Democrat since Jimmy Carter to gain a majority of the popular vote is likely to be a Presidential proof of the Peter Principle? Well, his record and rhetoric could lead an only mildly jaundiced observer to impressions like these:

1. He is an unimaginative “get-along, go-along” politician rather than an innovative leader. As a community organizer in Hyde Park, he hung out with radicals. In the Illinois legislature, he faithfully served the Chicago machine. In the U.S. Senate, he voted the party line. If he has ever had an audacious thought, he hasn’t uttered it. He shows only a tepid interest in public policy and a feeble knowledge of history. He appears reluctant to make decisions. In sum, he has so far been an oddly passive figure, “wafted by a favoring gale/ As one sometimes is in trances”, an actor who has mastered the lines given to him instead of the auteur of his own Presidency.

2. His perspective on foreign affairs is Panglossian, as diversely illustrated by his reduction of the Berlin Airlift to an example of the peoples of the world coming together to deal with a crisis, his insistence that we can hold fruitful negotiations with the Iranian mullarchy, and his tepid initial reaction to the Russian invasion of Georgia. The War on Terror, too, is no more than a limited conflict with al-Qa’eda, which exists only in Afghanistan and the nearby parts of Pakistan. Our other adversaries can be mollified by sincere diplomacy. At the same time, he expects other countries to act more in accord with their sentiments than their interests. Thus it is very important to close our prison at Guantanamo Bay, because foreign public opinion doesn’t like it, yet adopting protectionist policies won’t have any impact on relations with the neighbors we’re trying to beggar.

3. His notion of how the economy works is naively demand-sided. Putting money into the hands of poor and middle income consumers will create prosperity, because they’ll then buy more goods and services. Alas, goods and services must be produced before they can be bought with redistributed dollars. As Rudyard Kipling, a better economist than this acolyte of Saul Alinsky, put it:

   In the Carboniferous Epoch we were promised abundance for all,
   By robbing selected Peter to pay for collective Paul;
   But, though we had plenty of money, there was nothing our money could buy. . . .

   To fund its beneficence, the government has to either take more from producers or manufacture money out of nothing. The latter course of action defeats itself through inflation. The former leaves the “rich” with less incentive to produce, less capital to invest in other productive enterprises and, for that matter, less wherewithal to spend on their own consumption. Unless one believes that the country is full of Uncle Scrooges hoarding their cash in money bins, it is absurd to think that dollars gain vigor by being shuffled from A to B. Nor is this just a matter of theory: For the past quarter century, the United States has practiced supply side, and Europe demand side, economics. Our economy has grown vigorously, modulated only by the inevitable business cycle. Europe has stagnated.

4. Side by side with demand side economics, he nourishes a contradictory readiness to reduce ordinary Americans’ purchasing power through a sharp rise in energy prices. As I noted in my last post, the natural outcome of his policies – an outcome that he half acknowledges – will be a lower standard of living and recession in perpetuity. That he is unfazed by that prospect suggests to me that his economic philosophy is, like that of many men who have given little attention to such matters, a vague jumble within which all varieties of delusion can readily find a place.

What these factors point to is a President who is by nature a party loyalist and Beltway insider, the sort who will drift along with liberal orthodoxies. The latest sign that he is no harbinger of innovative policymaking or a new kind of politics lies in his first two appointments: John Podesta to head his transition team, Rahm Emanuel as White House chief of staff: two Clinton retreads, one a left-wing ideologue, the other a classic “war room” politician.

No wonder Messrs. Dow and Jones are gloomy. It would be nice – and good for my portfolio – for them to be proven wrong, and I can fuzzily imagine a scenario in which President Obama, newly sworn in, throws off the mask and announces that he has long been a secret disciple of Milton Friedman. Now, that would be quite a denouement for this bizarre election cycle.

Obamausterity

The idea of economic stagnation as a desirable policy is still only a whisper on the fringe of the environmental movement. That isn’t a reason to ignore it. All ideas start out being thought by only a few. Sometimes – anyone over 25 can call up examples – the conventional wisdom about them moves from “Preposterous!” to “Oh, but of course” in an astonishingly short time.

So let’s not presume that prosperity will remain one of our government’s goals. Let’s especially not presume it when the man who, according to the polls, is likely to become our President-elect next Tuesday speaks thus:

There is no better potential driver that pervades all aspects of our economy than a new energy economy.

I was just reading an article in the New York Times by Michael Pollen about food and the fact that our entire agricultural system is built on cheap oil. As a consequence, our agriculture sector actually is contributing more greenhouse gases than our transportation sector. And in the mean time, it’s creating monocultures that are vulnerable to national security threats, are now vulnerable to sky-high food prices or crashes in food prices, huge swings in commodity prices, and are partly responsible for the explosion in our healthcare costs because they’re contributing to type 2 diabetes, stroke and heart disease, obesity, all the things that are driving our huge explosion in healthcare costs. That’s just one sector of the economy. You think about the same thing is true on transportation. The same thing is true on how we construct our buildings. The same is true across the board.

For us to say we are just going to completely revamp how we use energy in a way that deals with climate change, deals with national security and drives our economy, that’s going to be my number one priority when I get into office. . . .

The “new energy economy” may be a hazy dream, but one element is absolutely clear: It will be an economy where energy is more expensive than today, not because less costly alternatives don’t exist but because the government prefers to force factories and farms and transportation systems to forgo them. Senator Obama seems to understand that higher energy prices mean a lower standard of living. How is American agriculture “contributing to type 2 diabetes, stroke and heart disease, obesity”? By taking advantage of “cheap oil”, our farms grow food that even the poorest can afford in abundance. Up the price of energy, as happened during the oil price bubble earlier this year, and people will perforce eat less.

They will also drive less, dress less well, live in smaller homes with fewer comforts, have fewer choices of goods and services, and so on. Changing to a way of life “that deals with climate change” will indeed “drive our economy” – but not forward. The Wealth-Spreader doesn’t mind. His slogan in 2012 may well be, “Recession is good for you!”

Further reading: David A. Ridenour, “Limiting C02 Emissions Hurts Poor Most”

The Essence of the Case for Obama

Law professor Tom Smith has summarized the reasons to vote for Barack Obama. The whole “endorsement” is worth reading, but the pith of it is –

all the talk of Hope and Change can be distilled into a two-fold message that is both direct and pure: If Obama is elected President, the government will give me money. And second, that would be fair.

How can I disagree? Alas, though I too need the dough, I’m caught up in identity politics and plan to vote for my fellow Cranky-Old-Guy American. Sure, I know I’m fated to be just a C.O.G. in the Obama Nation, but, after he shuts up Rush Limbaugh, shuts down Fox News and shuts out all those nasty neo-cons, the Wealth-Spreader no doubt will let a few of us remain at large as evidences of His gracious clemency.

Quote of the Day

Larry Kudlow:

The dumbest thing I heard today on the economy was a statement from Sen. Obama. He says the decline in GDP is “a direct result of the Bush administration’s trickle down, Wall Street first, Main Street last policies that John McCain has embraced for the last eight years and plans to continue for the next four.”

Wait a minute. Did I miss something here? After the bursting of the tech bubble and the 9/11 attacks, George Bush lowered tax rates across-the-board for individuals and investors. The stock market rallied uninterruptedly for five years. The economy expanded from the end of 2001 to the end of 2007. Are we to really believe the Obama narrative that cutting tax rates is the cause of this downturn? Not the credit shock? Not the Obama-supported government mandate to sell unaffordable homes to low-income people and to pressure Fannie and Freddie to securitize these loans? And not the oil shock, as well?

It was really tax cuts that caused this recession?

That’s the dumbest story ever told.

When I was young, liberals espoused Keynsianism, which, right or wrong, was a rational economic theory. Today they just bluster. The intellectual deterioration is wondrous to behold.

That CREEPy Feeling

Watergate became famous, but the real scandal of the 1972 election was the Committee to Reelect the President, popularly known as “CREEP”, whose highly dubious tactics gave Richard Nixon a crushing advantage over George McGovern. While Nixon would have won in any event, he was the type to fix a sure thing.

In the last week of this year’s campaign – perhaps too late to matter – we learn that Nixon and CREEP have spiritual descendants in the entourage of Barack the Wealth-Spreader.

A week ago, one could reasonably assume that the Obama campaign’s failure to take elementary precautions against credit card fraud was mere amateurishness. That assumption is getting harder to square with the facts. Asked about its disabling of security precautions like address verification and CCV checking, The One’s spokesmen insist that they rigorously scrutinize contributions after receipt. We have their word for it!

A couple of e-commerce professionals have set up a Web site (Obama Shrugged) to look further into the matter. From them we learn that turning off security not only takes extra effort but incurs extra fees. Then, too, back-end checking is rendered more difficult and expensive by the absence of tools to detect credit cards submitted with phony names or addresses. At some level, the Obama camp made a conscious decision not to take basic precautions against fraud and was willing to pay for the privilege. There are only two possibilities here: stark incompetence or intentional abetting of criminal activity. Take your pick.

Did Barack Obama handle this matter personally? Probably not. Does he know about it now? How couldn’t he? The Washington Post is merely the latest to discover “Obama Accepting Untraceable Donations”. Has Senator Obama ordered security restored? Has he fired anybody? Is he embarrassed that his subordinates defend their missteps instead of rushing to correct them? Not so far.

We also learn, again belatedly, that the campaign’s denial of connections with the ACORN fraud machine is not precisely true. That it had paid $800,000 to an ACORN subsidiary was already known (except to people who rely for information on the MSM, of course). The latest news is that, according to an ACORN worker testifying in court, it also turned over lists of its big donors, so that ACORN could solicit money from people who had given the legal maximum to Obama’08.

How crooked is ACORN? A “natural experiment” gives us a clue. Threatened with prosecution last year, the organization’s King County, Washington, chapter agreed to abide by election laws, and the local authorities have enforced the agreement. The result: Its haul of new “voters” has fallen from 37,000 in 2004 to 500 this year.

Between CREEP and ACORN, or between stuffing cash into suitcases and accepting credit cards without verification, is not a long distance. Extrapolate to 1600 Pennsylvania Avenue. Perhaps an Obama Presidency will be less Jimmy Carter’s second term than Richard Nixon’s third.

Further reading: PowerLine, “Obama Shrugged: An Update”
Neil Munro, “FEC Rules Leave Loopholes for Online Donation Data”
Neil Munro, “Common Web Tools Make Tracking Donors Doable”

Back to the Hollow Army

National defense is a forgotten issue this election, despite that abundant empirical evidence that we need a larger and stronger military. Man for man our troops have proven themselves vastly superior to any conceivable enemy, but there aren’t enough of them, and they need all the help available from expensive technology.

Nonetheless, as the WSJ Political Diary (still only $7.95/month cheap) points out, the dominant wing of the Democratic Party still has the anti-military spirit of the McGovern campaign:

There’s at least one government program Democrats are planning to cut deeply next year. Rep. Barney Frank last week told the editorial board of his home district’s South Coast Standard-Times that defense spending will be slashed by 25% in the next Congress. He said such dramatic cuts would likely force the withdrawal of U.S. troops from Iraq and a rollback in Pentagon plans for high-tech weaponry. “We don’t need all these fancy new weapons,” the Massachusetts liberal told the paper’s editors.

Democratic presidential candidate Barack Obama has made similar comments on the campaign trail. In a video circulating on the Web, he says he intends to cut “tens of billions of dollars in wasteful spending” at the Pentagon. “I will cut investments in unproven missile defense systems. I will not weaponize space. I will slow our investments in future combat systems.” He also would institute a new oversight panel to monitor the DoD’s existing planning panel to make sure “it is not used to justify unnecessary spending.”

On his campaign Web site, Mr. Obama says he also wants to increase the size of Army by 65,000 and the Marine Corps by 27,000, while expanding health care, special ops, civil affairs and other specialties and introducing a “Military Families Advisory Board.” The Pentagon has worked in recent years to reduce overhead and increase what it calls “the tooth to tail ratio.” Mr. Obama’s clear agenda is to invest in more military tail, less tooth.

The pledge to add more men and expand special operations forces is Slick Barry’s way of separating himself from the Barney Franks, but it’s an illusion. Larger forces, if they are to be effective, require more money not just for pay but also for weapons, operations and “future combat systems”. And re-labeling undersupported units as “special operations forces” won’t make them elite. Will an Obama Administration secure adequate funding in the face of a Democratic Congress’s opposition and its own gargantuan domestic spending plans? Or will it do what the Obama Web site suggests: Divert money to an Armed Forces version of social spending while trimming combat readiness, thus re-creating the “hollow army” of the pre-Reagan era?

I think we all know the way to bet.

Further reading: Bret Stephens, “Will Obama Gut Defense?”
Michael Fumento, “The Democrats’ Special Forces Fetish”

Spreading the Poverty

Near the end of his speech yesterday in Denver, after declaring at length how his economic program will create prosperity “from the bottom up”, Barack Obama struck a discordant note:

Now, make no mistake: the change we need won’t come easy or without cost. We will all need to tighten our belts, we will all need to sacrifice and we will all need to pull our weight because now more than ever, we are all in this together.

Up to that point, the spectators were being reassured that an Obama Administration would lower their taxes, cut their health care bills, create millions of new jobs, lift wages, relieve mortgage indebtedness, reduce the cost of college education, etc. Not a word to intimate that any belts would have to be tightened, sacrifices undertaken or weights pulled. What was the candidate thinking?

Further on, there is a slight hint:

We can do this. Americans have done this before. Some of us had grandparents or parents who said maybe I can’t go to college but my child can; maybe I can’t have my own business but my child can. I may have to rent, but maybe my children will have a home they can call their own. I may not have a lot of money but maybe my child will run for Senate [not, let’s note, “maybe my child will start his own business and get rich”]. I might live in a small village but maybe someday my son can be president of the United States of America.

Maybe this is all disconnected rhetoric - “just words”. Or maybe Senator Obama has no expectation, or intention, that prosperity will return soon. He certainly seems to be preparing for the possibility that, for the next several years, the upshot of taxing away the capital of “the rich” so that the government can allocate it to its favored enterprises will be the same stagnation in incomes and jobs that has afflicted Europe for two decades.

There are circumstances when a leader must call for sacrifice, as when Abraham Lincoln faced a rebellion by nearly half the country or Winston Churchill defied the victorious Nazis or brave Iraqis in Anbar rose against al-Qa’eda. A recession is not like that. What is needed now is the production of goods and services that customers want to buy. The “sacrifice” involved is metaphorical and self-interested. Again and again, the economy has slumped, and human action has righted it. The pain of liquidating unprofitable investments has sometimes been sharp, but rarely long –

With one conspicuous exception. That was, of course, the Great Depression, where, as Amity Shlaes has usefully recounted in The Forgotten Man, the pain went on and on. The Hoover Administration and the New Deal anticipated the key points of the Obama Prescription: Taxes on “the rich” were kept high. The government directed a large portion of the country’s investment. Money was funneled to the less affluent through a wide range of welfare programs and the creation of make-work jobs. (Senator Obama calls them “green jobs”, but they produce nothing that anyone will buy at market prices.) Government regulation tightened its grip. International commerce was choked by protectionism. (A columnist for The Times of India helpfully compares the candidates’ positions on trade, just in case anyone doubts that Mr. Obama’s real middle name is “Smoot-Hawley”.)

FDR flourished politically despite his disastrous economic record. Why and how can be summarized in three principles:

First, he incessantly blamed his predecessor for all that was wrong. In his Denver speech, Senator Obama does the same, drawing on the superstition that the President is the mainspring of the economy. The uninformed listener might be unaware that the government has more branches than just the Executive.

It is striking – just a coincidence? – that a long boom, interrupted by a single short, mild recession, took off in 1995, after the election of a Republican Congress and continued through 2007, when the Democrats took control of both Houses. For the past two years, the President has been a Republican, but no one can reasonably say that he has been more than a bystander in the formulation of economic policy. Over his ineffectual resistance, Congress has sharply boosted government spending, thrown taxpayers into a slough of uncertainty about the future shape of the Internal Revenue Code, killed free trade agreements, raised the job-killing minimum wage and otherwise pursued a liberal Democratic agenda. And in lockstep with those measures, economic growth first slowed, then began its present decline.

Second, while the Roosevelt Administration’s policies couldn’t create productive jobs, they did make millions of people dependent on government aid. Senator Obama is cleverer than FDR in one respect. He will have the IRS write the checks, which he calls “tax credits”. Otherwise, he aims to practice the same short-sighted bribery that perpetuated poverty throughout the 1930’s.

Finally, President Roosevelt was an inspiring orator, who persuaded the majority of voters to look ahead to a bright tomorrow that steadily receded. Barack Obama is inspiring, too.

Ronald Reagan ran for President when times were worse than they are now. His message was not “sacrifice”, in the form of a perpetuity of zero growth, but the removal of barriers to entrepreneurship and success. Barack Obama is, here as in so many other areas, the anti-Reagan. He all but promises a return to the policies of Jimmy Carter (minus the Carter Administration’s tentative steps toward trade liberalization and deregulation). He may dream of “spreading the wealth”, but all there will be to pass around will be the “sacrifice”, which will look strangely like poverty.

Foreshadowings of the Revolution

President-designate King Barack the Spreader, as Mark Steyn calls him, declared on national television that Governor Palin was at fault for saying nothing when somebody in a crowd shouted “Kill him!” It was no defense that she wasn’t present or that the shout apparently never occurred.

By that stringent standard, doesn’t His Majesty-To-Be deserve a smidgeon of blame when his supporters set up a guillotine at an Obama rally or display a Palin mannequin dangling from a noose?

At the very least, we now have more insight into the relative hate levels of the two campaigns.

Obama, CEO

Barack Obama has held just two post-collegiate executive positions: chairman of the Chicago Annenberg Challenge, on which he for some reason prefers not to dwell, and proprietor of his own Presidential campaign. The latter, unlike the former, can’t be called a miserable failure. On the other hand, it gives us at least one disturbing glimpse into Slick Barry’s ability to manage a large organization.

Various bloggers have discovered that the Obama campaign Web site has disabled credit card security. It doesn’t check the validity of the name and address given by the cardholder. It doesn’t ask for the three-digit CVC number. Unlike virtually every on-line merchant and political Web site (including John McCain’s), it has no front-end safeguards against credit card fraud or illegal donations.

That all sorts of fictitious names – and occasional stolen cards – are making it through the campaign’s wide-open door has been public knowledge for some time. The campaign has done nothing to improve its system. Now, one doesn’t expect the candidate to take personal charge of configuring the site’s AVS settings, but fund raising is one of the campaign’s key activities. Why isn’t it in capable hands? Why hasn’t Senator Obama noticed that it isn’t? Whether or not anyone is deliberately trying to evade the campaign finance laws, the degree of incompetence is appalling.

Now extrapolate to 1600 Pennsylvania Avenue.

Slick Barry Makes It Up

The invaluable Mary Katharine Ham takes note of this item from that right-wing Republican periodical Newsweek, concerning the phony “Kill him” story:

During a heated moment in his final presidential debate with Sen. John McCain, Sen. Barack Obama noted the anger of some supporters at rallies for McCain’s running mate, Alaska Gov. Sarah Palin. “All the public reports suggested,” Obama said, that people shouted “things like ‘terrorist’ and ‘kill him’.” Making a death threat against a presidential candidate can be a crime. But even before Obama cited “reports” of the threats at the debate, the U.S. Secret Service had told media outlets, including NEWSWEEK, that it was unable to corroborate accounts of the “kill him” remarks—and according to a law-enforcement official, who asked for anonymity when discussing a political matter, the Obama campaign knew as much. Now some officials are disgruntled that Obama gave added credence to the threat by mentioning it in front of 60 million viewers. At this point in the campaign, said one, candidates will “say anything to make a particular point.”

So Slick Barry wasn’t just careless about vetting an inflammatory accusation – he lied. Will he apologize? As soon as Bill Ayers does.

Further on, Newsweek quotes a sanctimonious Obama campaign aide: “[T]he tone of the rhetoric at McCain-Palin campaign events has gotten out of hand.” Psychologists call that “projection”.

Barack Obama and the Powell Doctrine

If it weren’t for the speculation about his motives, Colin Powell’s endorsement of Barack Obama would already be forgotten. Of course, the rationale that the general presented on Meet the Press was such a combination of the conventional (the alleged nastiness of the McCain campaign), the preposterous (adolscent adulation of Slick Barry’s temperament and intellect) and the out-of-touch (the supposed rightward movement of the Republican Party) that it invited motive-mongering.

Some of the suggested motives are pretty clearly wrong. It’s unlikely, for instance, that race had anything to do with it. General Powell’s alienation from the Republican Party was obvious well before Barack Obama became the Democratic nominee for President. He would almost certainly have endorsed Hillary Clinton. He could have called her a “transformative figure”, too, and she has demonstrated deeper intellect and a steadier temperament than the neophyte Obama.

As to why this lifelong Republican now favors a down-the-line partisan Democrat for President, there is one donkey in plain sight: the Powell Doctrine, first set forth in a 1992 article in Foreign Affairs. General Powell wrote in the aftermath of the First Gulf War, with an eye toward justifying President Bush père’s military actions, including his decision not to complete the victory in Iraq by ousting the Ba’athist regime.

To a large extent, the Powell Doctrine is simply a restatement of the Clausewitzian principle that going to war is useful only if it serves the nation’s political ends. What makes it distinctive is its insistence that the only acceptable military outcomes are quick, low-casualty victories with minimal complications in the aftermath. That point may not be fully evident from the Foreign Affairs article, which indeed states: “This is not to argue that the use of force is restricted to only those occasions where the victory of American arms will be resounding, swift and overwhelming.” That was, however, a pro forma reservation to cover extraordinary situations like World War II. For the normal course of events, the Powell approach was to undertake nothing difficult or dangerous. The interventions that he praised (e. g., the overthrow of Manuel Noriega in Panama and Operation Eastern Exit, the 1991 raid that rescued the U.S. Embassy staff in Somalia from a rebel siege) were all of that kind. His argument against proceeding to Baghdad after liberating Kuwait was “the inevitable follow-up: major occupation forces in Iraq for years to come and a very expensive and complex American proconsulship in Baghdad”.

In 2002, as Secretary of State, General Powell took a different view of the pros and cons of ridding the world of Saddam Hussein. He became a prominent advocate of forcible regime change. Had he forgotten his own doctrine?

Probably not. One must remember the context. Most of the leading figures in the Bush fils Administration, including the President himself, saw the War on Terror as a struggle of indefinite duration aimed at destroying a worldwide network of Islamofascist, far Left and other terrorist groups. They had no expectation of winning quickly or, except in the very long run, decisively. Maybe there wouldn’t be a Vietnam level of KIA’s, but the whole enterprise was antithetical to General Powell’s principles.

Invading Iraq could be seen as the way to move back toward the Powell Doctrine. That may not be intuitively obvious, but consider: A war against Saddam Hussein was likely to be a walkover (as it in fact was). After a spectacular success against a long-time enemy, the Administration would be able to declare victory and stop devoting resources to an amorphous conflict with all the world’s evildoers.

What about “the inevitable follow-up: major occupation forces in Iraq for years to come and a very expensive and complex American proconsulship in Baghdad”? General Powell’s State Department had a simple solution: Let liberated Iraq fend for itself under the tutelage of the United Nations. As Douglas Feith documents in War and Decision, State showed almost no concrete interest in post-liberation planning. The reasonable conclusion is that it looked on the campaign as an end in itself, rather than a means to an end.

At that time, the paradigm for what to do after deposing a tyrant was Yugoslavia, where international agencies had taken up the task of reconstruction. They were inept, and American troops remained present year after year, but there was no serious strain on military resources, and the political fallout inside the United States was negligible. (How many voters care about administrative misfeasance in Bosnia?) State apparently expected a similar outcome in Iraq. Neither it (nor anyone else) anticipated that the mufsidun would launch an offensive there. By conventional reckoning, they would have been suicidal to choose a battlefield dominated by a huge concentration of American military power.

Yet they did. Perhaps they believed that America was a “weak horse” that would bolt at any alarm. Perhaps they were just foolish. The Bush Administration didn’t run away, and in time al-Qa’eda in Iraq lay shattered. The anti-terrorist campaign was, however, long and tedious, and it exposed the Achilles’ heel of the Powell Doctrine: We often don’t know at the beginning of a war whether a quick, overwhelming victory is possible, much less whether it will actually take place. If our initial onslaught doesn’t break the enemy, what should we do? The answer most consistent with the doctrine is to cut our losses and retreat. So far as one can tell, that is the course General Powell favored. Barack Obama definitely did.

The straightforward explanation for General Powell’s Presidential preference, then, is that he and Senator Obama both think defeats are better than slow, expensive victories. Their reasons for thinking that may differ: The general is a realist who seems to doubt that the American public has any stomach for the cost and uncertainties of warfare. The senator has spent his entire life in radical leftist circles, where it is taken for granted that foreign leftists’ critiques of America are words of wisdom that ought to guide our actions.

Notwithstanding their likely disagreements on first principles, the two men are at one on the practical level, so it’s not surprising that Senator Obama has declared that, if he becomes President, General Powell will be among his intimate advisors. That quasi-appointment has a logical corollary: The candidate’s occasional hawkishness vis-à-vis Afghanistan and the Pakistani border regions can be presumed to be no longer operative. No concept could be more alien to the Powell Doctrine than the deployment of major combat forces in the Central Asian wilderness. General Powell will doubtless instruct his protegé that chasing Osama bin-Laden and his lieutenants through mountains controlled by an multitude of independent warrior tribes will be a futile quest, with success improbable and not worth the price. He is also not likely to have much enthusiasm for an indefinite commitment to propping up Kabul against the provinces. If American troops must remain there, lest an Obama Administration be embarrassed by a reversal of campaign rhetoric, they will do so on about the same terms as other NATO forces, that is, in a passive role under constricting rules of engagement. The easy way out will be to negotiate a power-sharing deal with the Taliban, after which the Afghans can once again be forgotten by the world at large.

The Powell Doctrine well suits a diminished American role in international affairs. It is cautious at the outset and will become more so with each defeat. The conjunction of its author and Barack Obama is surely destiny. Lesser reasons really do not matter.

The Obama Nation Abroad

Colin Powell predicts that Barack Obama will be a “transformational President”, and who am I to doubt it? The question is, transformation into what? The future is always dark, and I have no spectacles of prophetic night vision. Nonetheless, the picture of what the Obama Nation will look like is becoming steadily less murky.

Senator Obama’s own running mate says, “It will not be six months before the world tests Barack Obama like they did John Kennedy. . . . Watch, we’re gonna have an international crisis, a generated crisis, to test the mettle of this guy.”

As Senator Biden doesn’t mention, President Kennedy’s test was the construction of the Berlin Wall, and he flunked. From that performance (reinforced by flounding at the Vienna summit), the Soviets took away the conviction that the new Administration was easy to push around. The next stop was the Cuban missile crisis. The world survived that, but those of us who can remember living through it would rather have skipped the experience.

Barack Obama has already shown how he will respond to a foreign crisis. He has “pre-reacted”, as it were. The terrorist campaign in Iraq after the deposition of the Ba’athist dictatorship, was, among other things, a test of American steadiness and will power. Senator Obama declared that we should do just what the Kennedy Administration did in Berlin: Back down. Is there any reason to think that he will have a different answer for a Russian invasion of Ukraine or a pro-Islamofascist coup in Pakistan or a nuclear-armed Iran’s ultimatum to Israel or an al-Qa’eda uprising in Saudi-controlled Arabia or Red Chinese threats against India or Taiwan?

Even if it wanted to, could the Obama Nation counter a serious challenge outside its borders? As President Bush’s political difficulties illustrate, vigor in our foreign policy requires the backing of domestic opinion. Mr. Obama’s base of support lies with people who never want to intervene anywhere at any time for any reason. They put up with President Clinton’s actions in the Balkans and Haiti only because those were inconsequential and casualty-free. Would they reverse their firmest principles after being exhorted by The One? Judging by what he says later in the speech quoted above, Senator Biden isn’t confident:

I can give you at least four or five scenarios from where [the crisis] might originate. . . . And he’s gonna need help. And the kind of help he’s gonna need is, he’s gonna need you – not financially to help him – we’re gonna need you to use your influence, your influence within the community, to stand with him. Because it’s not gonna be apparent initially, it’s not gonna be apparent that we’re right.

Rallying behind America in a crisis is not, as that rather pathetic plea implicitly concedes, the natural course of action for the Obama Left. Whence, then, would a President Obama draw supporters for, say, a showdown with Tsar Vladimir over the future of Ukraine? Will he abandon his base to court the conservatives he’s been denouncing for the past two years? Has he ever taken the risk of parting ways with left-wing velleities?

Whatever the exact course of events, the Obama Nation will almost certainly withdraw step-by-step not just from Iraq but, as the test results come in, from all the rest of the world, leaving the field to regional powers: Red China in Asia, Russia in Eastern Europe, Iran (or a Saudi-Egyptian alliance) in the Middle East, Venezuela in Latin America. All of those minor hegemons are anti-Western, internally unstable and politically reckless. Their lurches and spasms will make for interesting times.

The Obama Nation’s foreign policy may not be intellectually isolationist, but that will be its practical effect. Reinforcing the tendency will be its skeptical attitude toward foreign trade (pace Professor Goulsbee, who will, I’m sure, be less influential than Mr. Obama’s personal inclinations and those of the protectionist-dominated Democratic Congressional caucus).

Those parts of the world that don’t like the idea of being overseen by such fine folk as Vladimir Putin, Hu Jin-tao and Hugo Chavez are already looking for alternatives. The prospective free trade agreement between Canada and the European Union may be the first of many similar efforts. Why shouldn’t Mexico and Colombia follow suit? It would make a great deal of sense for those Latin American countries that reject neo-communism to link more closely with Europe, once the U.S. ceases to be a reliable trading partner and ally. For Europe, there is a benefit besides liberalized exchanges of goods and services: Latin American guest workers could start to displace some of the volatile Moslem immigrants who now provide a large part of the continent’s labor force. Spain is already encouraging immigration from the Western Hemisphere. For other EU countries, too, Mexicans might be an attractive alternative to Pakistanis.

So, looking ahead four years or so, we may well see a United States that has essentially opted out of world affairs and international commerce. (We’ll probably be busy fighting recession the way Herbert Hoover did, with trade barriers and tax increases on “the rich”.) If the remaining democracies are going to survive in the face of a multiplicity of aggressive tyrannies, they will have to alter their behavior dramatically: not just form a super-Common Market but expand their armed forces and risk dangerous confrontations outside their own neighborhoods. Their chattering classes enjoy ranting at America now. No doubt they’ll extol the Obama Nation in public – but secretly they’ll wish that the despised “W” were President again.

Verses on Spreading the Wealth Around

Once upon I time I knew the name of the author of the following stanzas, but it has slipped my mind, and not even my omniscient research assistant, Dr. Google, has been able to retrieve it. As I recall, he was an eccentric, politically incorrect fellow, with many of whose ideas I would not want to be associated. On notions dear to certain President candidates, however, and less pleasing to plumbers, he was spot on.

“Father, must I work to eat?”
“Oh, no, my lucky son,
We’re living now on Easy Street,
With dough from Washington.

“We’ve left it up to Uncle Sam;
Now don’t get exercised.
Nobody has to give a damn,
We’ve all been subsidized!”

“But if Sam treats us all so well,
And feeds us milk and honey,
Please tell me, Daddy, where oh where,
He’s going to get the money?”

“Don’t worry son, there ain’t no hitch
To this here noble plan.
He simply soaks the filthy rich,
And helps the common man.”

“But Daddy, won’t there come a time,
If we take all their cash,
When they’ll be left without a dime,
And things will all go smash?”

“My faith in you is shrinking, son,
You nosy little brat!
You do too damn much thinking, son,
To be a Democrat!”

(Painfully Naïve) Quote of the Day

Jennifer Rubin asks,

USA Today blasts Big Labor’s Employee Free Choice Act. Shouldn’t every candidate be asked why their election warrants a secret ballot but a vote to unionize a workplace doesn’t?

C’mon, Jen. What makes you think that liberal politicians believe that “their election warrants a secret ballot”? For years, liberals have been working to expand mail-in balloting, which is not secret in any meaningful sense. Someone who bribes or browbeats voters can check their ballots before mailing to make sure that they are being cast the right way. He can even take them to the post office himself. That’s exactly the assurance that political bosses have always wanted – and find hard to obtain when voting is done in the privacy of a booth.

Here in Cook County, one of the epicenters of liberalism, the inroads on ballot secrecy go further. In fact, the secret ballot has been completely abolished. In this enlightened city, the ballot is an oversized sheet with the candidates’ names in large, readable type. After it has been marked, it must be inserted face up into a device that checks for under- and overvoting. A cover sheet is available to block third party scrutiny, but its use is optional. Naturally, the recipient of a bribe or a threat, seeing a Democratic Party operative looking his way, won’t be so foolish as to hide his vote.

Many conservatives are worried this year about spurious votes. They’re right to worry. Cleaning up the election process and limiting opportunities for dishonest shenanigans is important. But, just as with union organizing elections, once the secret ballot is taken away, democracy becomes a farce, whether or not it is also vitiated by fraud.

The Czar of the Inland Waters

Living just a few hundred feet from the Lake Michigan shoreline, I have self-interested reasons for caring about the health of the Great Lakes. Hence, I’m one of the voters at whom Barack Obama aims his pander when he calls for a “Great Lakes Czar” with a starting bankroll – a “down payment” – of $5 billion.

It would be nice, in a way, for the people of South Carolina and North Dakota to send their tax dollars to my neighborhood, but consider this: The states that border the Lakes – Minnesota, Wisconsin, Illinois, Indiana, Michigan, Ohio, Pennsylvania and New York – have an aggregate state GDP of $3.8 trillion. Subtracting the approximately 20 percent that goes to the federal government (and ignoring the fact that much of that money flows right back), over $3 trillion are left, about 30 percent larger than the economy of Germany. Yet it is somehow beyond the means of the Great Lakes region to clean up our own waters? We are helpless without a Czar from Washington?

Illinois alone is as rich as Australia. How would you react if Kevin Rudd were haunting Capitol Hill begging for foreign aid to deal with his country’s ecological problems? Or if one of our Presidential candidates were pressing aid – and Czars – upon him?

Rathergate Writ Small

Following the lead of his media cheering section, Slick Barry Obama last night blasted Governor Palin for standing silent when somebody at one of her rallies responded to a mention of “Obama” by shouting “Kill him!” That outcry was the factual grain of sand around which the Obama Nation fashioned a new anti-McCain/Palin narrative: Republicans are inciting hatred! Civil rights leader John Lewis, whom John McCain praised at the Saddleback Church debate, put the Republican standard bearers in the same league as George Wallace.

That Governor Palin didn’t arrive until after the epithet was hurled – that fact was barely noticed, certainly not by Slick Barry. Nor were his acolytes going to listen to the lame excuse that a single nut doesn’t typify tens of millions of McCain supporters. Guilt by association has long been a bedrock of liberal polemics (applied in only one direction, of course).

Now we learn that McCain/Palin have one further excuse that maybe can’t be called lame: The incident didn’t happen. The Secret Service, which takes seriously any threat, however remote, against a Presidential candidate, investigated and could find no one who heard “Kill him!” other than the reporter who wrote about it. A local newspaper, the Scranton Times-Leader posted an exposé on its Web site yesterday:

Agent Bill Slavoski said he was in the audience, along with an undisclosed number of additional secret service agents and other law enforcement officers and not one heard the comment.

“I was baffled,” he said after reading the report in Wednesday’s Times-Tribune.

He said the agency conducted an investigation Wednesday, after seeing the story, and could not find one person to corroborate the allegation other than Singleton [the reporter who filed the story].

Slavoski said more than 20 non-security agents were interviewed Wednesday, from news media to ordinary citizens in attendance at the rally for the Republican vice presidential candidate held at the Riverfront Sports Complex. He said Singleton was the only one to say he heard someone yell “kill him.”

“We have yet to find someone to back up the story,” Slavoski said. “We had people all over and we have yet to find anyone who said they heard it.”

The time of the Times-Leader’s post isn’t recorded, but the first reader comment on it is time-stamped 4:42 p.m., about four hours before last night’s Presidential debate. Given the explosive way in which Senator Obama used this anecdote, shouldn’t his campaign have done a little due diligence, e. g., gotten Secret Service confirmation that it was true or at least checked local news sites to see whether there had been any follow-up? And shouldn’t the candidate now apologize for both his factual error and the sweeping conclusions that he drew from it?

Of course, we’re still waiting for Dan Rather’s apology.

Quote of the Day

The WSJ Political Diary (still only $7.95/month) takes note of a liberal newsman’s acknowledgment that “media bias” isn’t just a right-wing fantasy:

Mark Halperin, an editor at large for Time magazine and coauthor of the campaign field guide “The Way to Win,” was one of several speakers at yesterday’s conference on the 2008 election sponsored by Time and CNN in New York. During his panel discussion, Mr. Halperin was asked if the media had been too soft on Mr. Obama. To the surprise of the largely liberal audience, his answer was yes. He went on to say that through the subtle choice of which stories to cover and where to deploy investigative resources, the national media had handed Mr. Obama “hundreds of millions in free publicity.” He attributed the positive coverage in part to the historic nature of Mr. Obama’s candidacy. But he also noted that only a few hands had gone up in the crowded room when the audience had been asked how many had voted for George W. Bush.

He quickly tempered his remarks by noting that John McCain had similarly been the beneficiary of positive media coverage in his 2000 campaign. “It is interesting that the media’s favorite candidates in both parties both won their party’s nominations this year,” he observed. He called on reporters to look at their 2008 coverage of candidates after the election, in hopes that in the future “they do a better job treating people equally.”

Dog bites man – and here is a further nip:

Mr. Halperin’s comments were pithy, well argued and controversial. Yet, almost 24 hours after they were made, it appears none of the bloggers and reporters present for the event have chosen to report on them.

Q.E.D.

A Rational Panic?

Instapundit quotes an e-mail suggesting that last week’s stock market plunge may have been due to a saner impulse than rumor, fear and the madness of crowds:

The thumbnail future market history of this month is likely to include the phrase “correctly discounting the economic fallout of an Obama presidency and hard-left Congress repeating the failed frenetic economic policies of the 1930s”.

Stock prices reflect the investing public’s average current impression of what the economy will look like over an indefinite future span of time. For the past quarter century, both the Dow and U.S. economic conditions have tended upward. There have been interruptions – several bear markets, a couple of recessions, short periods during which foreign economies looked more buoyant – but the general picture has been one of a dynamic, prosperous America, with vigorous growth, low unemployment and a rising tide of private wealth. The rest of the world has been pulled upward in our train.

Coincident with – and, except in the eyes of the most intransigent socialists, not unrelated to – this economic fluorescence have been a number of tendencies and trends. Relative to pre-Reagan policies and those of the rest of the world, the United States has been notable for –

• relatively low taxes and government spending (not always at the same time, but almost always at least one or the other);

• relatively modest levels of government regulation and management of the economy;

• a widening “investor class”, now reaching down into income brackets that once possessed almost no capital;

• openness toward the movement of goods and services across our borders;

• restrained money supply growth;

• declining labor union membership and influence;

• a robust foreign policy that has kept our country’s inevitable enemies on the defensive and minimized the damage that they could inflict on our and our friends’ interests; and

• high levels of technological innovation, which have sharply increased productivity.

Anyone who thinks back to the 1970’s can’t help but be struck by the contrast. When Ronald Reagan took office, marginal tax rates were at about twice their present levels, the government dictated gasoline prices (and had recently tried fixing prices for the entire economy), banks could not operate across state lines, interstate freight rates required government approval, trade barriers “protected” almost every industry that faced substantial foreign competition, no one had an IRA or a 401(k) plan, welfare rolls were expanding steadily, a quarter of the non-government work force belonged to labor unions, federal deficits were routinely monetized, “realistic” statesmen conceded that the Soviet Union was a permanent fact of life with which we would have to reach a modus vivendi on more or less equal terms, and so on. The result had been a decade and a half of what came to be called “stagflation”. The plateau was not level, but its character is adequately demonstrated by the fact that inflation and unemployment rates in the six or seven percent range were widely accepted as the best we could hope for.

The Reagan Administration fostered dramatic policy turnarounds, and sustained prosperity followed. (Technological advances may have been a happy coincidence, though I don’t think it is daring to think otherwise. Barack Obama professes to believe that computers were invented by “government scientists”, but it was the dynamism of private enterprise that transformed them into a ubiquitous part of our lives.)

At every turn, this vision of “change” met stout, reactionary opposition. Dreams from My Father tells of young Barry Obama’s role in trying to muster resistance while “Reagan and his minions were carrying on their dirty deeds”. The leaders of that opposition, e. g., Ted Kennedy, are today’s liberal icons. A down-the-line foot soldier is the Democratic Party’s Vice Presidential candidate.

Nor has anti-Reaganism faded into a sentimental nostalgia on the order of Jacobitism or waving the Confederate flag. At least, a rational investor, observing Senator Obama’s promise to raise taxes on “the rich”, his ambivalent (at best) attitude toward trade liberalization, his embrace of the corrupt remnant of labor unionism (including not only the abolition of secret ballots in organizing elections but also a promise to end monitoring of the International Brotherhood of Teamsters), his extravagant proposals for new spending and entitlements, his tendency to blame deregulation for all of the economy’s imperfections, and his insouciance about foreign threats, can readily conclude that the 1970’s are on their way back. The corollary is that enterprises won’t do as well as seemed likely a year ago. The Panic of 2008 presents an opportunity to find a new level more in line with probable tomorrows.

Aggravating pessimism is a new element unknown to the Johnson-Nixon-Ford-Carter era. The consensus of bien-pensant opinion is that the economy must be intentionally constrained in order to prevent “climate change”. Not many will say directly that poverty is their preferred prophylactic for carbon emissions. There is, however, no other way to describe a policy of imposing taxes or arbitrary ceilings on the use of the most efficient forms of energy. Whether or not that policy is justified by its impact on climatic conditions, it unquestionably will make all of us poorer than we would otherwise be, and the present value of stocks must be lower as a consequence.

The total picture that investors see, then, is a blend of old pro-stagnation approaches and a new imperative to make energy a scarcer resource. Perhaps strokes of good luck will falsify such fears. We might discover a way to harness fusion power cheaply, or a miracle drug might make the work force universally healthy and energetic, or miracle foodstuffs might simultaneously eliminate malnutrition and obesity, or a computer algorithm might solve the problem of economic calculation and render free enterprise obsolete, or compassionate extraterrestrials might make Earth the beneficiary of a gigantic foreign aid program. The gloomy investors pushing the Dow downward may be proven as wrong as the old-time Malthusians. That is not, alas, the way to bet.

Joseph R. Biden, Historian

Joe Biden isn’t just a fabulist about his own life. The WSJ Political Diary (subscription only, but a mere $7.95/month) has an account of one of his ventures into creative historicizing:

Consider a speech he gave to the Council for the United States and Italy in Venice last June, before he was tapped as Barack Obama’s running mate. I was there. He speech was about “inflection points.”

“Venice,” he intoned, “is a place that grew from very little and, by good fortune and good management, came to be the de facto center of the world by the 13th century. It was the richest city in Europe, and arguably the most powerful.”

At this point, Mr. Biden started to lay the parallels on pretty thick: “Then, beginning in 1453, its leaders launched an unsuccessful war in the Middle East. They failed to respond to growing international economic competition. They faced a devastating pandemic. And they were slow to invest in and adopt new technologies.” . . .

“The Venetians,” Mr. Biden explained, “lost their military and economic edge in part because they were slow in transitioning away from old, inefficient oared galleys to sailing vessels powered by renewable energy – in their case, the wind. This gave countries with merchant and naval fleets that were not reliant on oar power a huge competitive advantage.”

Like the Venetians, Mr. Biden concluded, America risks missing out on the future by eschewing “wind power.”

As the saying goes, this would get an F in freshman history. Venice was indeed rich and powerful, and it did decline. The rest is mostly spun out of the imagination of the Senator or his speech writer. Particularly startling is the assertion that “beginning in 1453, its leaders launched an unsuccessful war in the Middle East”. In 1453, the Ottoman Empire captured Constantinople and liquidated the Byzantine Empire. A small Venetian contingent assisted (not very enthusiastically) in the city’s defense. After that, Venice spent the next two centuries defending its possessions in the eastern Mediterranean against Ottoman attacks. Is that Senator Biden’s notion of launching a war? Just how invested is he in the notion of Moslems as the perpetual innocent victims of Western aggression?

The environmentalist stuff is silly, too, if not so pernicious. The navies of both the Venetians and their enemies were comprised largely of oared galleys. So long as ramming and boarding were more important than broadsides in naval warfare, galleys were superior to sailing ships, especially in the relatively smooth and often becalmed Mediterranean.

Actually, Venice’s Arsenal, the center of its shipbuilding, remained Europe’s largest and most advanced industrial complex until the 18th Century. As Macaulay’s schoolboy would have known, Venice ceased to be a great power not because it fell behind technologically but because Spain and Portugal opened new routes to the Far East the ended its domination of the spice trade, and because the rise of vast nation states doomed independent cities to second tier status. Neither of those was a development that Venice could have prevented or turned to its advantage.

The “devastating pandemic”, by which the Senator must mean the Black Death, was at least real, though it fits his story line rather poorly. It broke out in 1348, over a century before the “unsuccessful war in the Middle East”, and had little long-term effect on the city’s prosperity.

Quite simply, this whole morality tale is fiction. Where Senator Biden got it from, I can’t imagine, but it certainly suggests that assimilating facts and putting them to use is not one of his talents.

2008 ≠ 1932

Lots of folks are tossing around comparisons between the past few weeks and the run-up to the Great Depression, while some leftists are starting to opine that a dose of depression might not be such a bad idea. As signs emerge that the Democratic leadership in Congress had no real interest in passing the Paulson Plan and the Democratic candidate for President remains coolly indifferent to its fate, one can’t help detecting nostalgia for 1932 in the air.

In the narrowest political sense, the comparison may be apt. Substantively, it is nonsense.

If the current disruption of the credit markets doesn’t push the economy into a recession, it will be the biggest economic surprise of the decade, but there’s nothing to suggest that the downturn will be out of line with recent history, that is, short and shallow. (If a Democrat is in the White House, the media may even notice the actual depth and duration.) The environment of 1932 was very different from today’s, and it took a series of disastrously misguided decisions to deepen a slump into a depression. Between the stock market crash of 1929 and Franklin Delano Roosevelt’s election to the Presidency, Congress enacted the Smoot-Hawley tariff and raised tax rates on the wealthy (the only income tax payers in those halcyon days). President Hoover jawboned employers to keep wages at unsustainable levels and refused to consider easing or abandoning the Gold Standard. The Federal Reserve Board aggravated the gold link’s deflationary impact through technical mistakes that inadvertently tightened the money supply. Other countries followed similarly counterproductive policies.

With much toil and difficulty, the world’s governments managed to push production and employment more sharply downward than in any previous period of peace. Today’s governments aren’t compelled to act the same way. They almost certainly won’t repeat some past blunders. Most notably, central bankers’ understanding of monetary economics had advanced a great deal during the past 70 years.

Some of Herbert Hoover’s missteps could, however, be made again. For example, the next President might be skeptical of free trade and favor hiking taxes on “the rich”. And when those measures somehow failed to resurrect the economy, he could adopt FDR’s program of regulation and intervention, which kept unemployment at double digit levels until World War II siphoned millions of young men into the armed forces. Reproducing the Great Depression is almost certainly beyond even the modern Democratic Party’s considerable talents, but they could give it the old college try.

The World’s Greatest Collection of Potted Plants?

John McCain decides that working on Congressional action to stabilize the credit markets is a higher priority than campaigning or holding a debate on foreign policy. Harry Reid and Barack Obama respond that the candidates aren’t needed at their Congressional duty stations, because “Congress and the Administration have a process in place to reach a solution to this unprecedented financial crisis”.

The United States Senate used to be called “the world’s greatest deliberative body”. We all know that the sobriquet is obsolete, but did one expect the Senate Majority Leader ever to say, in effect, that Senators are a collection of potted plants whose participation is unimportant to dealing with an “unprecedented financial crisis”?

Either Senator McCain or Senator Obama will soon have to preside over whatever bailout structure Congress puts into place and cope with its consequences. One of them wants to be closely involved in shaping it; the other apparently is happy to wait and see what he is handed.

The Chain of Proximate Causes

This must be the biggest week for Rudyard Kipling quotations in a long time:

If you can keep your head when all about you
Are losing theirs and blaming it on you. . . .

Every knowledgeable observer agrees that the world economy has narrowly avoided the most severe credit crunch since the Great Depression, and that the margin of escape was frighteningly narrow. It’s still possible, in fact, that the rescue plan stitched together by Secretary Paulson will unravel. The garment is ugly and ill-knit. Those who are supposed to don it may be tempted to tug at the loose ends; some of them may not truly want it to hold together. The joy that rang out in the sinistrosphere when the crisis was at its worst hints that not everyone would be saddened by further turmoil.

If all investors and lenders were acting rationally, the Paulson Plan would never have seen the light of day or, if it did, would be laughed to scorn. Unhappily, the essence of a panic is irrationality, and there are only two ways to deal with it: Either let the markets find their bottom, or overpower panic with an outsized bailout. The former choice would mean several miserable years for the whole world. If I were the Universal Dictator, I would take it, muttering haec olim meminisse iuvabit, confident that men a decade hence would praise my foresight.

Statesmen in the real world don’t have the luxury of time. The Bush Administration must practice the art of the possible. It has, at least, remembered the one great truth about panics: For those who can hold for the long term, there is no better time to buy. The United States Treasury can hold for a longer term than anybody else. Unless we are doomed to reversion to the Paleolithic, Mr. Paulson’s $700 billion commitment will eventually be the most profitable speculation in the history of finance, although the details of his scheme will undoubtedly need rectification as time goes on. There’s a danger that the mentality that drove the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) into the ground will resurface, leading to a renewed crisis in the future. It’s also possible that this huge federal beachhead into the private sector will be followed by an expansion of government control or will encourage hopes for taxpayer-funded subventions to any sector of the economy that encounters turbulence.

How well the bailout is handled will ultimately depend on what historical lessons politicians and the electorate draw from the events that precipitated it. The Left has already started making its reflexive case: Deregulation is at fault; we need the firm but gentle hand of the government to prevent a repetition.

Leftists will keep repeating that line, regardless of its utter detachment from reality, spinning theories as to how “tax cuts for the rich” or the repeal of the Glass-Steagall Act somehow caused all our problems. In Tuesday’s Wall Street Journal, Charles W. Calomiris and Peter J. Wallison explain, au contraire, why the housing meltdown was a massive failure of government intervention:

Many monumental errors and misjudgments contributed to the acute financial turmoil in which we now find ourselves. Nevertheless, the vast accumulation of toxic mortgage debt that poisoned the global financial system was driven by the aggressive buying of subprime and Alt-A [just above subprime] mortgages, and mortgage-backed securities, by Fannie Mae and Freddie Mac. The poor choices of these two government-sponsored enterprises (GSEs) – and their sponsors in Washington – are largely to blame for our current mess.

How did we get here? Let’s review: In order to curry congressional support after their accounting scandals in 2003 and 2004, Fannie Mae and Freddie Mac committed to increased financing of “affordable housing.” They became the largest buyers of subprime and Alt-A mortgages between 2004 and 2007, with total GSE exposure eventually exceeding $1 trillion. In doing so, they stimulated the growth of the subpar mortgage market and substantially magnified the costs of its collapse. . . .

[B]eginning in 2004, their portfolios of subprime and Alt-A loans and securities began to grow. Subprime and Alt-A originations in the U.S. rose from less than 8% of all mortgages in 2003 to over 20% in 2006. During this period the quality of subprime loans also declined, going from fixed rate, long-term amortizing loans to loans with low down payments and low (but adjustable) initial rates, indicating that originators were scraping the bottom of the barrel to find product for buyers like the GSEs.

The authors go on to retell the story of how the Bush Administration and Congressional Republicans tried to reform the GSE’s:

In 2005, the Senate Banking Committee, then under Republican control, adopted a strong reform bill, introduced by Republican Sens. Elizabeth Dole, John Sununu and Chuck Hagel, and supported by then chairman Richard Shelby. The bill prohibited the GSEs from holding portfolios, and gave their regulator prudential authority (such as setting capital requirements) roughly equivalent to a bank regulator. In light of the current financial crisis, this bill was probably the most important piece of financial regulation before Congress in 2005 and 2006. All the Republicans on the Committee supported the bill, and all the Democrats voted against it. Mr. McCain endorsed the legislation in a speech on the Senate floor. Mr. Obama, like all other Democrats, remained silent.

In a nutshell –

• The proximate cause of the near-collapse of credit markets around the world was Fannie Mae’s and Freddie Mac’s reckless lending.

• The proximate cause of their ability to act recklessly was the failure of reform efforts in Congress.

• The proximate cause of reform’s failure was the rock solid opposition of the Democratic Party.

• The proximate cause of Democratic opposition to reform was the party’s inability to grasp elementary economic principles or its unwillingness to embrace them when they conflicted with short-term political advantage.

On the most important economic issue of the new millennium, the party of the Left was drastically wrong. Its representatives deserve blame equal to what they heaped on Herbert Hoover 75 years ago. They won’t, needless to say, recognize their responsibility and hang their heads in humiliation. Instead, they hope that the consequences of their own misjudgements will bring them to power.