Democrats & Liberals Archives

Don't Think Things Are Bad? You're Not Paying Attention.

There are times in a country’s history where it simply doesn’t pay to stick your head in the sand. This is one of them. Unfortunately, it seems like some, even on this site are vastly underestimating the fundamental extent of the crisis we are in, or the urgency of action required.

Eric Simonson- This is not an economic collapse… yet. Obama is not doing the things that need to be done in order to stabilize the ‘crisis’. He doesn’t care about the ‘crisis’ per se except as an excuse to nationalize healthcare, redistribute wealth, and, “fundamentally transform America.”

From it's peak in May of last year, the Dow Jones Industrial has lost more than half its value. There are kids in Middle School who have never seen the Dow Jones Industrial Average this low in their entire lives. We've gone from virtually full employment to an 26 year high in unemployment in the space of a single year.

Virtually every major bank is on life-support, with nationalizing these banks, even temporarily, a serious consideration.

Within the space of a quarter, we've lost 6.1 percent of the GDP, the worst decline in 27 years.

I doubt the Republicans spared much time in using the economic decline under Carter as a reason to do things their way. Americans gave them the chance to try out their methods. When it seemed like they were working, Americans went with it. As much as we had problems with certain outcomes, we felt that the benefits outweighed the costs. That, needless to say, is no longer the case. The Republicans have proved just as capable of messing up the economy, and they have the added burden of being involved in the last, similar such economic collapse.

It's no mystery why Republicans have wasted no time blaming FDR for the continuation of the Great Depression. After all, FDR's policies might otherwise be considered a practical model for averting a continued economic slide, and restructuring the economy towards recovery. God forbid we should abandon policy that failed for policy that didn't. The Republicans would like people to help them vindicate, once more, the policies they've been trying to vindicate since before the Great Depression, when they had the advantage in pushing their laissez faire agenda. Once again they redbait, as they undoubtedly did in the thirties. Once again, doom and gloom are predicted if we go along with Liberal policies.

Some, even, would like to believe that there is no crisis, that the economy would work just fine if we stopped trying to fix it.that is unlikely to be the case. The problem is real, too real. We haven't faced the worst of it yet.

Republicans talk about scare tactics, but I don't see what could be called objectively reassuring about the markets, at this point. They're simply looking for an excuse not to act. But their not acting or acting in an indulgent, laissez faire way is just what got us into this trouble in the first place. The two responses the Bush Administration attempted, first letting Lehman Brothers fail, and then engineering two of the biggest bailouts in American history without good oversight of what was going to be done with the money, tell us much about the unfortunate hesitance on the Republican's part to do what is necessary.

The Republicans need to realize that they can be of help, if they so choose to be. They can push policies that help get big business back on its feet, and off the government's back, out of the taxpayer's wallet. They can recognize that they cannot repeat the strategies of the past in dealing with recessions, because this recession is the result of an artificial failure of the superstructure of our economy.

They can avoid being like the Republicans of the thirties, whose behavior helped set their party back for decades afterwards, in both the White House and the Congress. They can become a party of practicallity, rather than abstract orthodoxy, of folks who talk things out, rather than trying to impose their dogma on others by brute political force.

But it's really up to them. Only they can yank their heads out of the sand.

Posted by Stephen Daugherty at March 9, 2009 12:15 PM
Comments
Comment #277211

Stephen, don’t mind Eric Simonson’s apologetic responses to the consequences of his Party’s policies. I mean, if I had voted for Republicans the last decade and to elect and reelect GW Bush, I would be enormously tempted by cognitive dissonance to shift the blame to Pres. Obama as well.

I hear from Pat Buchannan that this cognitive dissonance is a pervasive and shared experience amongst most Republican voters, these days. I would have to agree with him from a good deal of the commentary left by Republican voters on this web site.

Their toolbag now consists of the following:

1) shift all responsibility to Obama and Democrats, and pretend Republicans never held power.
2) turn every legitimate criticism of Republican rule into, “We meant to do that but, it didn’t work because minority Democrats wouldn’t approve”.
3) Deny reality. (This is one in high use these days.)
4) Redefine terminology to suit an apologetic stance.
5) Change the subject, and that right quick, when the apologetic argument falls apart.

Now, what’s this I hear about Democrats defending their, and Republican’s, earmarks in the current Omnibus appropriations bill left over from last year? Does this not create a bit of cognitive dissonance for Democrats who campaigned on cutting waste, fraud, and abuse in the spending bills? Are Democrats in Congress really going to follow the Republican say one thing and do another pattern of governing?

Posted by: David R. Remer at March 9, 2009 5:40 PM
Comment #277213

As for the severity of the economic crisis. It is hard to overstate. However, Stephen, if you think Democrats can continue to spend on non-essential items adding them to the debt, you may want to survey economist’s estimates of the crises created by the entitlement additions to the debt, coming as early as 2016. It is said that crisis will make the 1930’s look like economic Nirvana with 75% employment, including those economists in Obama’s cabinet.

Your party is quickly going to lose all credibility if they pursue their defense and invocation of these earmarks which do not address efficiently and effectively the crises and maintenance of government essential operations, and refuse to prioritize spending in this national economic emergency.

Posted by: David R. Remer at March 9, 2009 5:52 PM
Comment #277219

David,
Earmarks are an issue, and no one wants to see wasteful, pointless spending. However, earmarks are a distraction from the big picture. For the GOP, it’s an issue intended to discredit all government actions, and undermine the Democrats. As we are all aware, earmarks were not a problem for the GOP when they were in power.

Stephen,
Good article. Over the weekend, there was a movement to expand the FDIC’s line to $500 billion; in other words, a very big bank is about to fail.

I think there’s a realization entering the national political consciousness: repeatedly bailing out failures is not sustainable. There needs to be a nationalization of the large failures, a period of three to six months under government ownership, and then piecemeal sale of the viable assets. Letting the failures fail in an instantaneous collapse would be catastrophic for all of us. Nationalization and distribution might work well for Citigroup, GM, BofA, and the other large corporations that took a swan dive, and are about to go splat on the pavement, hitting like a hefty bag full of vegetable soup and hair.

Posted by: phx8 at March 9, 2009 6:59 PM
Comment #277220

Gee for once I agree with Remer. The Dems are going to spend this country into oblivion.

Posted by: KAP at March 9, 2009 7:01 PM
Comment #277221

I always thought Republicans were argumentative, but now I just think they’re stupid. A spending freeze? More tax cuts? It’s a complete denial of the reality we face. This is a party of charlatan hucksters playing to rubes. It’s pure theater. I see a party unwilling to face up to basic scientific facts, common knowledge, recent history (like last month), and simple logic. The Republican party has lost its mind.

Posted by: Max at March 9, 2009 7:03 PM
Comment #277224

KAP,
We’re heading for economic oblivion right now, and no one may be capapble of doing anything to stop it. One hope is that spending will stimulate the economy and keep it from crashing. If you know of any Independent party or GOP ideas which are better solutions, speak up!

When the GOP speaks, they say ‘do nothing.’ If anyone throws out an idea, they say ‘it won’t work.’ That is not helpful. The GOP seems intent on blocking anything the Democrats do, simply because the ideas are being proposed by Democrats.

Posted by: phx8 at March 9, 2009 7:31 PM
Comment #277225

To all Republicans out there:

If President Obama threw up his hands, asked Congressional Republicans to take over the economic councils, name economic leaders and promised he would sign into law any and all bills presented to him by them on the subject of the economy…how long would it take for the entire system to fail completely, the federal government to dissolve and states to have to go their own way, print their own money and hope for the best? How long before the starvation began? How long before al Qaida or some other organization recognized our weakness and got into the mood to put an end to the Western devils?

Posted by: Marysdude at March 9, 2009 7:34 PM
Comment #277229

Marysdude,

Sooooo, what you’re saying is, if we don’t support the Democrats and Obama’s plans to spend ourselves into prosperity, the terrorists will win?

Those who oppose some of the actions of this president have already been called ‘unpatriotic’, I don’t suppose using another of the old Bush cannards wouldn’t hurt.

Posted by: Rhinehold at March 9, 2009 8:29 PM
Comment #277232
It’s no mystery why Republicans have wasted no time blaming FDR for the continuation of the Great Depression. After all, FDR’s policies might otherwise be considered a practical model for averting a continued economic slide, and restructuring the economy towards recovery.

It’s on mystery because it is a factual observation. It is also factual that the ‘New Deal’ were the continuation of the policies that Hoover had proposed and started to put into place. In fact, FDR won on the platform of turning back the role of government and getting the budget balanced, that Hoover had been too interventionist.

It never ceases to amaze me that people still parrot the incorrect view of FDR that he rode in on a white horse and saved out country. Well, not really I suppose, when people want power or want to enact policies by using fear as the last two administrations have been working towards, there is little reason to be surprised of anything I suppose.

The democratic congress, the last administration and the current administration have already spent trillions of dollars and plan on spending more, yet we are seeing nothing getting better… Maybe people are getting tired of their chain being yanked and having those that are responsible being dragged down to help those who weren’t?

Nah, it’s all just because capitalism is a bad thing.

Posted by: Rhinehold at March 9, 2009 8:36 PM
Comment #277238

Rhinehold,
Do Libertarians have a constructive idea to help prevent the economic meltdown? I mean, other than absolutely nothing whatsoever. Everybody already got that part. Feel free to present the postiive ideas of Independents.

Seriously, I’d like to see something positive added to the debate. So far, the opponents of Obama and the Democrats offer either nothing, or nothing relevant.

Posted by: phx8 at March 9, 2009 9:35 PM
Comment #277239

Rhinehold-
We need not recapitulate every policy Roosevelt made. We should not, in fact. Some of his plans were objective failures. However, what was not an objective failure was using government spending to get demand back up, get the economy growing again.

Roosevelt did indeed beat up Hoover about spending and fiscal responsibility. But instead of cutting spending and raising taxes (two moves that later would bring on a relapse of economic troubles for FDR), FDR did much the opposite. And we should be glad.

We need people who make tough decisions and don’t let what they said in a campaign bind them from doing what is objective the right thing. When you allow that to happen, the quality of one’s judgment becomes distorted.

Once you get in the job, the campaigning for the next term should be done first and foremost by doing your job. FDR did his job, and the people loved him for it. Bush failed to do his job, and people hate his guts for it.

As for hating Capitalism? I’m sorry, you’re looking for the Marxist in 21B. I love capitalism. I just don’t think it runs well without good rules, and I don’t think the world ends if Government helps to push certain technologies and start certain initiatives.

Posted by: Stephen Daugherty at March 9, 2009 9:55 PM
Comment #277241

Stephen Daugherty,
You can’t expect people to believe only the Democratic Party Leadership is capable of pushing successful technologies and initiatives.
I find it very hard to believe only the Republican Party is responsible for our current delema. I cannot believe I am that ignorant.

Posted by: Weary Willie at March 9, 2009 10:28 PM
Comment #277244
Do Libertarians have a constructive idea to help prevent the economic meltdown?

Of course they do, as to Republicans, as do Greens, etc… That you want to ignore them is not other people’s fault, it is yours. And it is even worse that those on the left rankled when Bush supporters claimed the same thing of the Democrats during the first half of the decade… You don’t see that?

I mean, other than absolutely nothing whatsoever. Everybody already got that part. Feel free to present the postiive ideas of Independents.

I have and will continue to do so. For a single example of many, I was one for calling for an end to the mark-to-market laws put in place post-Enron that led DIRECTLY to the lack of lending capital during the latter half of the last year that caused much of what happened. Neither Bush nor the Democrats running the House and Senate wanted to do anything about it. They are both culpable. This administration is culpable for continuing the mismanagement that started with the Republicans and Democrats and for making it worse.

Seriously, I’d like to see something positive added to the debate. So far, the opponents of Obama and the Democrats offer either nothing, or nothing relevant.

Again, you not looking for it doesn’t mean it doesn’t exist. So go try your invalid and ineffectual argument on someone else.

Posted by: Rhinehold at March 9, 2009 11:21 PM
Comment #277245

WW,

You may be right…the Republican party may have some sound ideas…but, it is so engrossed with obstructionism and being hatefully negative, we may never know any of those good ideas until it is in office again…by that time it will have long been too late. The party has presented two policy ideas so far:

1. Do nothing

2. Cut taxes

Since the two ideas presented have been attempted for several years, and both failed, do you expect somehow that folks will suddenly have faith again? What is going on on the right? Has fear of Limbaugh’s disapproval caused paralysis? It’s like listening to robotic voices repeating the same thing over and over…

Posted by: Marysdude at March 9, 2009 11:23 PM
Comment #277247
However, what was not an objective failure was using government spending to get demand back up, get the economy growing again

Actually it was. The demand was lacking mainly because of two things, first was not something he did but didn’t reverse, the tarriffs that effectively ended ALL international trade. The second was the repeated and horrendous attacks on ‘those with means’ that caused many to pull money out of investing and go into a protective mode. Much as what is happening now.

The spending did help keep things going a bit until we got healther (and the ultimate issues were fixed, sadly 10 years too late) as a bandaid, but it did not FIX anything.

In his private diary, FDR’s very own Treasury Secretary, Henry Morgenthau, seemed to agree. He wrote: “We have tried spending money. We are spending more than we have ever spent before and it does not work… . We have never made good on our promises… . I say after eight years of this Administration we have just as much unemployment as when we started … . and an enormous debt to boot!”

Economic historian Robert Higgs draws a close connection between the level of private investment and the course of the American economy in the 1930s. The relentless assaults of the Roosevelt administration — in both word and deed — against business, property, and free enterprise guaranteed that the capital needed to jump-start the economy was either taxed away or forced into hiding. When FDR took America to war in 1941, he eased up on his anti-business agenda, but a great deal of the nation’s capital was diverted into the war effort instead of into plant expansion or consumer goods. Not until both Roosevelt and the war were gone did investors feel confident enough to “set in motion the postwar investment boom that powered the economy’s return to sustained prosperity.”

How much of the proven failed policies of the past are we going to keep revisiting?

FDR did his job, and the people loved him for it.

Had the world crisis not broken out FDR would not have been re-elected to a third term. His polls numbers were horrible and he was blamed for the continuing of the depression much longer than it should have. However, most people did not want to change president during such a volitile time and he won re-election. His handling of the war is what endeared him to the people.

Many modern historians tend to be reflexively anti-capitalist and distrustful of free markets; they find Roosevelt’s exercise of power, constitutional or not, to be impressive and historically “interesting.” In surveys, a majority consistently rank FDR near the top of the list for presidential greatness, so it is likely they would disdain the notion that the New Deal was responsible for prolonging the Great Depression. But when a nationally representative poll by the American Institute of Public Opinion in the spring of 1939 asked, “Do you think the attitude of the Roosevelt administration toward business is delaying business recovery?” the American people responded “yes” by a margin of more than two-to-one. The business community felt even more strongly so.
Posted by: Rhinehold at March 9, 2009 11:36 PM
Comment #277250
we may never know any of those good ideas until it is in office again
Posted by: Weary Willie at March 9, 2009 11:53 PM
Comment #277251

DR
Again. It is the constitutional function of congress to spend money. Bringing federal funds back to the districts they represent is the job of congresspersons. That is why we elect them. Their success or failure in that regard is determinent regarding their re-election. The alternative is to have the executive branch make all the spending decisions. Are you argueing for a benign dictater? You usually get it. Is this condemnation merely reflexive perhaps?
Believe me, I would support a %40 cut in “earmark” spending. We should cut every funding request made by every Republican. Of course some would think that is a bit partisan.

RH
In an ironic twist, the BHO regime has been dragging its feet re. bank nationalization with rightist like Greenspan and Baker pushing it.
Warren Buffet,often called a capitalist,is urging that we stand united behind BHO as esentially a wartime president.

WW
“I cannot believe I am that ignorant”

You make it too easy sometimes.

Policy decisions have consequences. A series of policy decisions by those in power that result in negative outcomes is a clear indicater that those policies were not correct. Blame shifting reduces our ability to learn from our mistakes. Your party ,while in power, made some serious mistakes for reasons of idealogy. An intelligent response is to question the basic ideaology that underpinned those decisions and go forward.

Posted by: bills at March 9, 2009 11:57 PM
Comment #277253

Marysdude:

I had hoped more from Obama. Trillion dollar deficits as far as the eye can see. Rose colored glasses on the economy. Predicting 4%/year economic growth!! Using a crisis to cram through his left wing agenda. You guys have just lost every ability to criticize Bush.

Oh now the troops are coming out of Iraq. What is it 16,000 in September? Bush would have done the same thing. McCain supports Obama’s Iraq plan.

In terms of the big crisis, where is Obama’s input? Anyone can spend our way to oblivion. Obama’s plan for economic growth is simply to take advantage of the crisis the push through his far left wing agenda.

Forget new politics.

Posted by: Craig Holmes at March 10, 2009 12:00 AM
Comment #277254

Too many of the arguments being made here are knee-jerk responses to stereotypes having to do what the parties supposedly represent rather than what they actually have done historically and are currently doing.

What was Kennedy’s response to an economic downturn? Cut taxes. What was George W Bush’s response? To borrow money from the Chinese to “stimulate” the economy.

So who was the Republican and who was the Democrat and whose measures succeeded? Kennedy, the Democrat, succeeded, by following measures that Reagan would take later and which people now brand as “Republican.”

Obama is doing exactly what Bush did, only doing ten times more of it. That Bush did it is not an excuse for Obama doing even more of it. Both should be condemned for expanding the government and saddling future generations of Americans with debt.

How did the Republican’s respond to the Great Depression? By becoming fiercely protectionist and trying to raise tariffs through the roof?

Was this Ralph Nader or Dennis Kucinich doing this? No, Herbert Hoover.

It’s not about party. It’s about what works and what doesn’t. Growing government, increasing taxes, and stifling business does not work. Not when Republicans do it and not when Democrats do it.

Stupid economic policies are not suddenly smart ones simply because Democrats instead of Republicans are carrying them out.

Posted by: Loyal Opposition at March 10, 2009 12:01 AM
Comment #277257
Your party ,while in power, made some serious mistakes for reasons of idealogy.

WHO SAID THAT? (stiff jawed) WHO WAS IT? (puff puff)

Whoever you are, Quote me as a member of the Republican Party.

I dare you.

A series of policy decisions by those in power that result in negative outcomes is a clear indicater that those policies were not correct.

Only if they were made in the last 8 years. A Democratic policy, in time, will always be the best policy because the Democratic Party has always been the longest lasting party in our nations history.

Go figure. The longest lasting party in our country’s history is still in power and we are suffering the same fate our forefathers suffered and died for.

Oh, well! Sorry about our luck, eh?

Posted by: Weary Willie at March 10, 2009 12:46 AM
Comment #277259

Weary Willie-
I’m neither claiming the Democrats are saints nor the only folks operating with full skulls.

The trouble is that the Republicans are using a one-size fits all strategy, and will not let themselves or anybody else use any others without a fight, even after their policies have lead to what’s happened today. The Democrats had their part in the dismantling of the safeguards and economic protections, but the Right led on this, and led right up until the point it failed claiming Americans couldn’t get economic leadership any better than from them, in this way. McCain even was saying “deregulate”, and “make the Bush Tax Cuts permanent”

I am not always free of frustrations when I see what my party and even President Obama are doing. But at least the Democrats seem to be willing to try more than one approach, to accommodate other ideas within reasonable limits. The Republicans won’t seem to support it unless Rush Limbaugh and the Club for Growth say they can.

Posted by: Stephen Daugherty at March 10, 2009 1:23 AM
Comment #277260

Rhinehold,
So, let me get this straight. Last year, while Bush was still president, you called for suspension of mark-to-market accounting practices, which are widely accepted practices. Again, that was done during the Bush administration. It was done because, by widely accepted accounting standards, the financial sector was bankrupt.

(This gets into some pretty obscure stuff. For anyone who is interested, the wikipedia article on mark-to-market accounting and the subprime crisis gives a good sketch of a complex topic).
http://en.wikipedia.org/wiki/Mark-to-market

I’m fine with pretending the financial sector is still viable. Of course, they know they are not, and they know the other members of the sector are not, but the fiction is preferable to the reality for all concerned.

Secretary of the Treasury Geithner is attempting to sell the mortgage-related “toxic assets” at 40 cents on the dollar, but no amount of accounting fiction will convince anyone those assets are actually worth that much.

The losses are real (if anything that has to do with these financial vehicles can be said to be real). Accounting practices did not cause the crisis. Mark-to-market practice only forced the holders of the toxic assets to admit their losses, which triggered ‘margin calls’ for the holding institutions.

Leverage magnified the housing downturn. A fairly ordinary drop in real estate became a financial catastrophe, because investments to the tune of $52 trillion dollars (notional value) lost their value. Worse yet, they lost their value in an illiquid, unsupervised “shadow market.” There was no government regulation or oversight to ensure orderly trading. There was no way the federal government could save them from themselves. THAT caused the crisis.

The following link is to a Daily Kos article on Shadow Banking. I’d suggest scanning the four excerpts from articles, because they give a good understanding of what happened, and… well, just how bad it really is.
http://www.dailykos.com/story/2009/2/18/84218/8682/223/696440

Posted by: phx8 at March 10, 2009 1:28 AM
Comment #277262

Rhinehold-
The Protectionist measures and the monetary measures didn’t do much good. The thing to keep in mind was that the New Deal wasn’t necessarily pretty at the time it was being used.

The Hoover Administration’s policies were much uglier, though. The difference is largely that FDR did more. He pulled out all the stops, not having so many sacred cows to gore.

Let me ask you a question: when in strategy do you do nothing?

Well, are you waiting for something to happen? What particularly, then, and how will you know it when you see it?

Are events already lined up, such that unimpeded they might solve the problem on their own? What are these trends, what are these events?

Is this just a natural gyration, with market forces set to ripple things back to where they were?

I’m asking you these questions, because you can attack and you can defend, but generally when you seek a neutral position, it’s because you know something’s coming, or you know what you want and are just looking for the means to get it.

That’s not the impression I’m getting here. I’m getting the impression that “Do nothing” is simply invoked for philsophical purposes, as rhetorical habit. That’s not good enough, in my view. In general, I don’t have much respect for automatic approaches.

Roosevelt was caught in the midst of a structural collapse of the economy, not something caused by natural variability. He at least kept the country out of the hell it was in up until his election. It wasn’t perfect, it wasn’t conclusive until WWII, but it was much better than the alternative in practice.

Craig Holmes-
The real question is, where are the people practicing the old politics setting their priorities?

Just for future reference, which do you think more important: reducing the poll ratings of the opposition delegation in Congress, or confronting the crisis we face out there?

LO-
Kennedy succeeded in large part because taxes were incredibly high for the rich by our standards. Reagan ended up having to raise taxes three times. Meanwhile, Bush cut taxes again and again, and only succeeded in starting us down the road to deficit.

Here’s the operative question: Bush did everything you described, cut taxes, cut regulation, and let business have free rein.

How did that work out?

Posted by: Stephen Daugherty at March 10, 2009 1:58 AM
Comment #277263
Weary Willie- I’m neither claiming the Democrats are saints nor the only folks operating with full skulls.

You are doing neither. You are obfuscating and procrastinating. You are making excuses and you are deflecting responsibility.

You are laying bets your party will convince the world someone else is to blame. Your payoff will be greater control and an obedient mass of human flesh.

Tell me I’m wrong, Stephen Daugherty. Take the next 8 years proving your party is the light on the hill. Your party is in control. Why do you keep harping on the Republican party standing in the way.

It’s because your party needs a scapegoat, and the Republican party has been available since the civil war.


It makes me sick to think a party that has been in control of this country since 1820 is ripping us off. Why would you support the Democratic Party when it’s continued existance is perpetuated by it’s allowing an opposition party to make it’s mistakes for it? HMMM? Think about it!

Stephen Daugherty, Why is the Democratic Party alway the savour of this country? If the Democratic Party is so knowing and seeing, why would the Republican party be a factor at all?
It’s all to appearant money is the root of this evil. Yes evil, Steven Daugherty, and partisanship. Success needs a goal and an opponent. The Democratic Party Leadership has successfully manufactured both throughout this country’s history.

Posted by: Weary Willie at March 10, 2009 2:14 AM
Comment #277264
Rhinehold, So, let me get this straight. Last year, while Bush was still president, you called for suspension of mark-to-market accounting practices, which are widely accepted practices.

Yes. ‘Widely Accepting’ meaning the law, then yes. If the same rules had been in place during the Saving and Loan crisis the US would have been a Chineese province over 15 years ago.

And you can see where I pointed to it here.

Again, that was done during the Bush administration. It was done because, by widely accepted accounting standards, the financial sector was bankrupt.

And it was an overreaction that has solved nothing. It didn’t prevent fraud (Madoff?), it didn’t prevent economic issues. It failed miserably and impacted the economy in a very negative way. As Mr. Isaac, chairman of the Federal Deposit Insurance Corp. from 1981-1985 said:

The biggest culprit is a change in our accounting rules that the Financial Accounting Standards Board and the SEC put into place over the past 15 years: Fair Value Accounting. Fair Value Accounting dictates that financial institutions holding financial instruments available for sale (such as mortgage-backed securities) must mark those assets to market. That sounds reasonable. But what do we do when the already thin market for those assets freezes up and only a handful of transactions occur at extremely depressed prices?

The answer to date from the SEC, FASB, bank regulators and the Treasury has been (more or less) “mark the assets to market even though there is no meaningful market.” The accounting profession, scarred by decades of costly litigation, just keeps marking down the assets as fast as it can.

This is contrary to everything we know about bank regulation. When there are temporary impairments of asset values due to economic and marketplace events, regulators must give institutions an opportunity to survive the temporary impairment. Assets should not be marked to unrealistic fire-sale prices. Regulators must evaluate the assets on the basis of their true economic value (a discounted cash-flow analysis).

If we had followed today’s approach during the 1980s, we would have nationalized all of the major banks in the country and thousands of additional banks and thrifts would have failed. I have little doubt that the country would have gone from a serious recession into a depression.

If we do not halt the insanity of forcing financial firms to mark assets to a nonexistent market rather than their realistic economic value, the cancer will keep spreading and will plunge the world into very difficult economic times for years to come

Now the current administration wants to use tax money to artificially inflate the value of these assets instead of removing the mark to market rules temporarily and allow the market to right itself without using tax funds. And we are talking about nationalizing the banks, just as Mr Issac stated.

Secretary of the Treasury Geithner is attempting to sell the mortgage-related “toxic assets” at 40 cents on the dollar, but no amount of accounting fiction will convince anyone those assets are actually worth that much.

LOL, so why is PennyMac (former CountryWide executives with heavy ties to Democrats) buying them up and planning on making billions of dollars on them then?

You are going to tell me that those loans which represent REAL people in REAL houses with REAL loans can’t be purchased for 40 cents on the dollar and the lender then strike a deal with the current occupants to forgive outstanding past-due balances and refinance the loans at a good fixed rate and someone make some good money that way?

Investors aren’t doing it because they don’t know what is going to happen tomorrow to those loans? What strings are attached? What rules are going to be forced on those loans in the next 3 to 6 months that may make them worth less than 40 cents on the dollar?

It is the not knowing what is going to happen that keeps investors at bay, just as it did in the 1930s.

Leverage magnified the housing downturn. A fairly ordinary drop in real estate became a financial catastrophe, because investments to the tune of $52 trillion dollars (notional value) lost their value.

On the books, not in reality. That’s the problem. You can only make that assumption if your wealth is in that amount that the house value drops. And we only went back to pre-2004 values in houses, it is not like we lost decades of value increases. But we then force those loans on homes that are not worth 0 to be marked at 0 even though there is a real asset tied to those loans that can be sold, at a loss most likely, but still worth more than they were being forced to value them at. Once they were valued so low, there was no room to borrow, liquidity dried up. But it wasn’t and isn’t ‘real’ because there is still value there that isn’t being recorded.

The following link is to a Daily Kos article on Shadow Banking. I’d suggest scanning the four excerpts from articles, because they give a good understanding of what happened, and… well, just how bad it really is. ”>http://www.dailykos.com/story/2009/2/18/84218/8682/223/696440

You’ll forgive me if I don’t read a DailyKOS propoganda piece. Just like I know you wouldn’t read anything from FreeRepublic or Foxnews. You should know better than that, Stephen.

Posted by: Rhinehold at March 10, 2009 2:20 AM
Comment #277265

phx8, not Stephen, sorry, my bad.

Posted by: Rhinehold at March 10, 2009 2:21 AM
Comment #277266
Here’s the operative question: Bush did everything you described, cut taxes, cut regulation, and let business have free rein.

How did that work out?

Uh, no he didn’t, as I just pointed out. He implemented bad policy in the wake of Enron that has caused a bad situation to be much worse, he didn’t relax those rules when they were proving bad.

In fact, his administration, in trying to fight the recession he inherited and get past the economic fallout of 9/11, interferred in the economy in ways that would have made many liberals blush. Until now, that is…

We have serious problems in the US, but a lack of governmental interferrence is definately NOT one of them.

Posted by: Rhinehold at March 10, 2009 2:26 AM
Comment #277276

So Bush inherited a recession, according to Rhinehold up above here. And then apparently fixed it (?) and then left us with another one. He of course said there was no recession at the end of his phony presidency but we all know there was one for at least a year now. So how did the Democrats do this to Bush and this country again?

Posted by: ray at March 10, 2009 8:28 AM
Comment #277277

Weary Willie-
Can you guys ever look at things beyond partisan politics? This is not all about YOU!

Your party has decided to be a roadblock, has decided essentially to act like nothing’s happened and just play the same political games.

If you want to play the obstructive opposition, that’s fine. We’ll play off you, wear you down, make you sorry. But we’re not doing it just to win elections. All we need is a Senate seat or two, and we’ll be able to work without your leave.

At the same time, most Democrats are not interested in the same belligerent opposition you folks demonstrated. Most of what we want is to take care of the problems that have come up to plague this country.

The Republicans, though, have a vested interest in the institutions of the past, the paradigm government has been running by.

Unless the Republicans wake up and admit their problem, they’ll never solve it. They will become victims of their own delusion as they stoke populist rage against them. You guys are at 20 percent in the polls. Are you trying to figure out how much lowere you want to go?

Posted by: Stephen Daugherty at March 10, 2009 8:37 AM
Comment #277285

i will throw this out there: what do republicans think of the extra $13.00/per week for the middle class workers? i will look back and see the responses. be very careful you just may show how completely out of touch with america you really are.

stephen i think you’re great! but, as i read repub posts - i guess they will never understand the other 99% - no matter how hard you try.

Posted by: bluebuss at March 10, 2009 12:11 PM
Comment #277287

Tell us how you feel about Republicans Stephen; it seems to be on your mind lately! Since the election you’ve called the GOP morons (12/12), screw ups (1/22), unconcerned (1/30), arrogant and cowardly (2/2), unimaginative (2/6), hate mongers (2/15), stupid (2/26), dishonest and wrong (3/7).

So why not add dogmatic brutes to the list? Oh, and if you can’t find a Republican to fight with you can just anoint Rush as the face of the GOP then proceed to call him names.

They’re pickin up the prisoners
and puttin
em in the pen……

You don’t want a constructive conversation with someone who believes differently than you do. You don’t want to make a critical assessment of where we are and how we can best get to where we need to be. You’re not trying to win friends and influence people at least in a fashion that I’ve ever seen.

All you are doing is dancing Stephen.

Never mind the heat
comin off the street

Posted by: George at March 10, 2009 12:13 PM
Comment #277293

Max, your comment below steps over the line of our rules.

“I always thought Republicans were argumentative, but now I just think they’re stupid.”

In order bring that comment into compliance, it would need to read: “I always thought Congressional (or Elected) Republicans were argumentative, but now I just think they’re stupid.

Without such qualification, your comments reads as an insult toward WB participants who are Republican voters, and that is a clear violation of our WB rules.

Please comply with our rules to avoid having comment privileges suspended.

Posted by: WatchBlog Manager at March 10, 2009 1:15 PM
Comment #277294

George,

It is just that Stephen finally lost his patience. He has attempted to conduct what you call ‘constructive conversations’ for several years. He has had the patience of Job, but he has finally cracked under the insurmountable pressures of the waves bouncing off the blank slate of conservative dogma (now that’s pretty close to ‘dogmatic brutes’).

And, if you’d like someone to call Rush foul names, you don’t have to wait for Stephen…I’ll be glad to oblige…thanks for asking…

Posted by: Marysdude at March 10, 2009 1:15 PM
Comment #277296

PS:

Rush Limbaugh (AKA Brash Lamebrain) is a drop-out who couldn’t make an honest living, so he became a ‘conservative radio talk show host. He is a drug addict who finds fault with just about anything and everything outside his realm of understanding. He is a hate-monger who influences his ‘ditto-heads’ into lockstep compliance with antidemocratic, anti-common sense, anti American talk and activity.

Should I keep going or is that enough for now?

Posted by: Marysdude at March 10, 2009 1:22 PM
Comment #277300

Rhinehold said: “Of course they do, as to Republicans, as do Greens, etc… That you want to ignore them is not other people’s fault, it is yours.”

I think Democrats are ignoring some the voices of third parties, but, then, third parties are not well represented in the Congress. Republicans however, are not being ignored. They are being heard, and their alternatives are being rejected. That is different from ignoring.

I agree with you though, they have alternative plans. But, those alternative plans should not supercede the plans of those elected to power in our government, unless those in power are persuaded by the merits of the alternatives. That is what the democratic election process is all about, isn’t it?

The role of Republicans, and other parties at this time is to attempt to construct alternatives which, on the alternative’s merits, are capable of persuading those elected to power to adopt a better course of action with higher probability of success.

Posted by: David R. Remer at March 10, 2009 1:30 PM
Comment #277301

PPS:

Oh, Yeah…did I mention that Brash is a buffoon, a blowhard and an academic nitwit?

Posted by: Marysdude at March 10, 2009 1:31 PM
Comment #277302

bills said: “Again. It is the constitutional function of congress to spend money.”

The function of Congress as set out in the Constitution is vastly MORE complex than this comment of yours attributes to Congress. Yes, they are charged with appropriating funds to accomplish the obligations of the federal government, but, as you can readily see, the way I have elaborated your comment with just a few extra words, diminishes the simplicity your assertion.

Posted by: David R. Remer at March 10, 2009 1:34 PM
Comment #277305

Weary Willie, your comment below violates our Rules for Participation. Your comment privileges are suspended.

You are doing neither. You are obfuscating and procrastinating. You are making excuses and you are deflecting responsibility.
Posted by: WatchBlog Manager at March 10, 2009 1:52 PM
Comment #277307

Stephen:

Just for future reference, which do you think more important: reducing the poll ratings of the opposition delegation in Congress, or confronting the crisis we face out there?

Are you talking about the economy or the war on terror?

We should probaably get one thing straight, Your parties conduct during the war was deplorable. Reid shouting the surge was a failure while young men and women were not even on the ground yet in Iraq. So don’t lecture on this one.

Remember what your party did to a sitting general in a war zone? Hope you enjoyed the rating increase at the expense of our troops.

Posted by: Craig Holmes at March 10, 2009 2:12 PM
Comment #277308

George, your comment, quoted below, violates our rules for participation. Failure again to comply with WB’s rules for participation will result in suspension of your comment privilege.

You don’t want a constructive conversation with someone who believes differently than you do. You don’t want to make a critical assessment of where we are and how we can best get to where we need to be. You’re not trying to win friends and influence people at least in a fashion that I’ve ever seen.
Posted by: WatchBlog Manager at March 10, 2009 2:19 PM
Comment #277309

Daugherty writes; “They can avoid being like the Republicans of the thirties, whose behavior helped set their party back for decades afterwards, in both the White House and the Congress. They can become a party of practicallity, rather than abstract orthodoxy, of folks who talk things out, rather than trying to impose their dogma on others by brute political force.

Mr. Daugherty, I would add that today’s liberal dems can avoid being like the dems of the 60’s. Here’s a brief refresher course of the “Great Society” written by conservative David Stokes.

“Our 36th president was famous for what was called “the Johnson Treatment” – a method of political arm-twisting that would presumably be seen today in the same category as CIA torture. Lyndon B. Johnson was the Jack Bauer of personal politics.

Those were heady days for President Johnson who soon found himself having been elected in his own right by a landslide margin and with a decidedly Democratic Congress on his coattails, if not in his pocket. After the 1964 election, the Senate was 68-32 and the House 295-140 lopsidedly in favor of LBJ’s party.

However, the biggest difference between what Johnson attempted to do in the mid-1960s and today is that LBJ launched his sweeping change against the backdrop of a stable economy. In fact, as Randall B. Woods has written in LBJ: Architect of American Ambition, “the Great Society was conceived and implemented during a period of growing prosperity.” Yet even then, it was largely a failure and ultimately politically repudiated.

Many wonder if President Obama, for all his best intentions, is overreaching by trying to do too many things so quickly and simultaneously. The answer to this might, in fact, be found in the story of Lyndon Johnson – a man with big dreams, a good heart, and gigantic ambitions.

While Lyndon worked the system as only he could do to bring forth his vision for The Great Society, he was mired in “that war in Asia.” And when LBJ went back to his Texas sanctuary near the Pedernales upon retirement, he did so as a man stretched, broken, defeated, despised, and in ill-health. For the rest of his days – which turned out to be not so many – he fumed about how Vietnam had been an altar of sacrifice for his best hopes for this nation.

I will not try to make a connection here between Barack Obama’s goals and some war over there. But what I will say is this: It is very possible that the economy itself might be an ironic Vietnam for the 44th president.

It’s very unlikely that anyone on his team a year ago envisioned the kind of economic meltdown we have now seen. Mr. Obama has assumed the office of the presidency during difficult times. Certainly, he must feel a sense of frustration about it all. He has dreams and ambitions that are threatened by a troubled economy.

But sometimes dreams have to give way to reality. Just as Lyndon Johnson couldn’t do guns and butter to the max for too long before something had to give, so President Obama needs to consider taking a page from another famous political playbook: “It’s the economy, stupid.”

He also needs to read the fine print of history and note that LBJ lowered taxes to continue to stimulate a growing economy. Proposed by President Kennedy, but stalled in Congress, Johnson led the effort to reduce the top marginal tax rate by 20 percent in February of 1964. He knew that a growing, prosperous economy was the only realistic foundation for what he wanted to do.

If Lyndon Johnson, master politician and visionary, couldn’t really make his “new deal” work against the backdrop of prosperity – can Barack Obama in these days of economic chaos?

Probably the most telling comparison between 1964 and now is that back then polls showed that 76 percent of Americans trusted the federal government to do what was right. Forty years later that confidence factor is less than half.”

Posted by: Jim M at March 10, 2009 2:32 PM
Comment #277310

Craig,

Again it comes out…anyone who was against the despicable, dishonorable and ill fought stupidity in Iraq is somehow a traitor, or un-American.

One last time…the stupidity in Iraq had nothing, I repeat, NOTHING to do with the ‘war on terror’…except to create better training and rich recruitment for terrorists.

Posted by: Marysdude at March 10, 2009 2:35 PM
Comment #277311

George-
I would invite everybody to go into the archives and my author profile, and take a look at what I actually think. But here’s some nickel summaries:

12/12 was my response to Republican Politicians willing to let our Domestic Automotive industry collapse, a move that would have probably been no more beneficial than the Lehman Brother’s collapse they allowed.

1/22 was a reflection on how, even as Bush screwed up time and again, I wished for him to start succeeding, because his failures were bad for the country. My concluding paragraph said this:

People want results. Obama will rise and fall on his ability to deliver those results, but the Republican’s game should not be to sabotage those results on political grounds. Americans will not tolerate the fate of this country being held hostage to the ambitions of its politicians. Either the Republicans work with the President towards the success of this country, or they will share its failure with everybody else. We don’t elect these people to glorify their own causes, but to support America’s needs, and shoulder the responsibilities of keeping our country safe, prosperous and free. America must come first, even if that means wishing for the success of the folks in office who would not be our first or even last choice.

1/30 essentially expressed a sentiment that Joe the Plumber and Rush Limbaugh have articulated, that the GOP can’t simply do a media makeover in order to get out of its hole. I disagreed, though, with the future direciton of the party. I believe following the old dogmas is political suicide, or at least a starvation diet when it comes to votes. They need, like Teddy Roosevelt’s Republicans, to get with the times in more way than just signing up for twitter.

My sentiment in 2/2 was an expression of frustration with the GOP, after years and years of watching it double down on this same political strategy. As I said:

I’m not a radical leftist, though some would quickly define me as such per their Rush Limbaugh/Sean Hannity/Ann Coulter training. I’m pretty much of a centrist, who once felt very comfortable as a Republican. But as a guy who believe that some government spending was good, that the New Deal was a net positive, that some regulation of Business and society was necessary, and so on and so forth, I found the radical shift to the hard right to be jarring and disturbing. The GOP I knew at that time was not full of people who thought the UN was a tool of Satan, or the Freemasons. It had people willing to face fiscal realities, rather than just a bunch of tax cut addicts. It had people willing to impose environmental and financial regulations, when push came to shove. It had people who could and would talk with the bad guys, and who were famous for having defeated our enemies through diplomatic opening of the country, rather than one final, apocalyptic war.

The GOP as it once was no longer exists.

What’s left in its place are either people too arrogantly confident in their ideology to change their minds, or too cowardly about crossing the ideologues and the pundits to be of much good to anybody.

2/6 was a rebuttal of the sentiment that Stimulus items always had to be roads and bridges projects, and suggested that there was more than one way to skin the cat of economic stimulus.

2/15 was about the failure of the Republicans to learn from their mistakes, and their insistence on having their mistakes be accorded equal status to Obama’s policy ideas, which have not yet proved to be wrong, and the fact that their actions may end up destructive to both the countrty and themselves. I backed that with several sources tracing out just what pundits like Rush had said, and what news reports had said about the results of different policies.

Ultimately, my approach has been the opposite of what you describe. My problem with Rush and other republicans can be summed up in terms of practicality and reaching beyond the narrow world of political argumentation. Politics can cover just about any subject that touches on group decision making, but the inclusion only goes one way. From the other side, politics is not the sum total of everything. It’s a means to an end, and must not be allowed to take over the conversation as a whole.

Posted by: Stephen Daugherty at March 10, 2009 2:42 PM
Comment #277312

Craig Holmes-
Deplorable? Understand this from my point of view: we had a President in charge who did not acknowledge failures that were billboard-sized attention getters to everybody else. We had a Congress dealing with progressively greater failures in the war in Iraq, culminating with a disastrous bombing at a holy shrine in Samarra, which blew up those tensions outright. The next years violence, even during the surge, was horribly greater.

What’s deplorable about saying the surge, at that point, is not succeeding? When many soldiers a week are dying, the Iraqis are not playing ball, and the ethnic cleansing is going on right before our eyes?

At that time, the surge seemed to me to be a waste of soldiers in rotation who might have been better used providing a softer landing to the Iraq war. Even now, I’m not convinced that was entirely wrong. But I never thought that letting things get worse was a good option, even as a transition to my desired outcome. My attitude was always, we had to get from here to there with some better planning.

You can pull out the “you, too” argument, but this current case with Obama is not about dealing with some ongoing failure of his, a Hail Mary pass from a president whose desperate line of failures in and out of the war had grown great distrust of him.

This is about the GOP essentially trying to return to the majority, to the white house by being a roadblock, as much as they can be, to Obama’s policies. Not by earning back the trust through positive alternatives that work. Not by cooperating and putting aside partisan differences for the sake of the country. Not by shedding the layer of slime and nastiness that has encased the party.

The Republicans want the voters to give them a bailout, ironically enough. They want voters to forget everything they did wrong, to ignore their continuation of their old policy positions and behaviors. They want folks to give them back what they lost doing pretty much what they’re doing now. You have the situation reversed: with us, the folks who weren’t failing were critiquing those who were. Here, the failures are critiquing those who have defeated them twice in a row, the last time on an economy the Democratic president did a better job of stewarding.

Posted by: Stephen Daugherty at March 10, 2009 3:08 PM
Comment #277317

Rhinehold,

While I don’t disagree some alteration of Mark-to-Market was and is still in order, surely, you are not suggesting this as a solitary solution to the credit meltdown, as this thread suggests?

You were asked for your solutions as a libertarian, what exactly are those solutions, other than, hands off?

Posted by: gergle at March 10, 2009 4:58 PM
Comment #277318
While I don’t disagree some alteration of Mark-to-Market was and is still in order, surely, you are not suggesting this as a solitary solution to the credit meltdown, as this thread suggests?

No, it is the main change that needs to be made. Beyond that, we have programs in place already to do much of the other heavy lifting. Then dealing with shoring up our economic health by tackling debt and out of control spending should be looked at.

However, that goes with the view that things that need to fail need to be allowed to do so. Continually propping up failed business practices, models and entities is going to prolonge the inevitable, as we have been doing for years. The Republicans and Democrats are for keeping things good for everyone with no regard to stability or viability.

You were asked for your solutions as a libertarian, what exactly are those solutions, other than, hands off?

No, I wasn’t. But I will infer that you are asking me now…

1) Fix the M2M issues we have, as well as SOX and some other reactionary programs that neither work nor help in this situation.

2) Allow the market to then settle on a value for the homes in the packages and provide for businesses to buy these to help get them off of the books of businesses who shouldn’t own them because of failed business practices. The US Government could help incentivise this through guaranteed LOANS and playing the job of broker. Then further incentivise the companies taking on the risk to work with the existing homebuyers to refinance from ARMs to Fixed mortgages, etc. The key is to have this plan in place FIRST so that those who can purchase the mortgages know what they are getting and won’t be putting themselves in unknown risk with a sketchy plan that is not finalized. Until that happens, this can’t be fixed.

3) Use existing progams to remind people that they have a fallback and their money in banks is protected through FDIC and existing bankruptcy laws.

4) Let business know you are not ‘going after them’ for two years, allow them to get back into the economy before telling them that they are going to be paying more taxes. Making strong assurances to this will help coax investors and businesses to look to expand, not contract.

5) Make good on promises of eliminating all pork and earmarks, this can only be done by congress btw. The president can promise to veto any bill with them in it, but he must be willing to veto and so far he is only showing that he will not when pushed.

6) Let it be known that any business that comes to the US government for handout because they are ‘too big to fail’ will be broken up immediately so that they are not.

7) make the stimulus a real stimulus, not a 13/week insignificance.

8) If we are going to have a school system like the one we have, utilize to teach people a) critical thought and b) personal finance. We do not teach either of these things to our children and, to be quite honest, these are the first two things we should be teaching. If they have these two they can learn the rest on their own.

9) Legalize and tax marijuana. This will end the ignorant spending of money on a failed and arguably unconstitutional practice and return more money to the federal budget through taxation.

10) Look at simplying or other alternative means of taxing. Understand the evils of forced charity and find ways to encourage charity without it being at the end of a gun. Really balance the budget and pay off our debts. We can’t expect our citizens to do it if we don’t take it seriously to do ourselves.

11) Most of all, allow people to fail and recover from failure to try again. This is the greatest strength of the United States that just doesn’t exist anywhere else in the world. If we lose this, as we have been doing the past several decades, we will be a far worse country for it.

There is more, but that’s just off of the top of my head. If you are really serious about debating these things, I may go into greater detail.

Posted by: Rhinehold at March 10, 2009 5:36 PM
Comment #277320

Stephen:

What’s deplorable about saying the surge, at that point, is not succeeding? When many soldiers a week are dying, the Iraqis are not playing ball, and the ethnic cleansing is going on right before our eyes?

First of all, let’s be clear about what was said. Reid said it was a failure! What is deplorable about saying early on in a combat venture that it helps our enemies. It puts our military at risk. These comments were made as troops were still moving into position.

So here I am with a son who is in the military scheduled to go to “the sandbox” and your leaders are saying his mission is a failure while he is still in America. Do you have any idea what that does to morale?

Now here in your comments above you appear (key word appear) to want to lecture the right on it’s criticism of Obama during a financial crisis. Right or wrong, I wont hear of it from a Democrat. You all sat back and let Pelosi and Reid fire away during an ongoing military action putting my son at risk.

Key words are “on going” and saying the surge was a “failure”.

Here is a link:

http://www.highbeam.com/doc/1P2-5869649.html

Basically, it’s hypocritical of the left to criticize the right for criticizing Obama in the middle of this crisis. You might be right, but you (as democrats) don’t have the moral authority to speak to the issue.


Posted by: Craig Holmes at March 10, 2009 5:46 PM
Comment #277323

Stephen:

I understand a political need to put all of the blame for this crisis on the Republicans doorstep. However here are just a few things that you might want to deal with.

1. Glass- Steagall. Republican Congress passed by Bill Clinton. 1999.

2. Robert Rubin: He was of course Clinton’s Sec of Treasury. Where is he now? If he was truely the brightest guy in the room do you still think so? He is a case of the chickens coming home to roost.

3. Here are some of your heros:

http://www.youtube.com/watch?v=_MGT_cSi7Rs

Basically this is a mess created by both parties.

Obama is now according to a report on drudge reached a record. He has the worst start of any president in the stock market.

Posted by: Craig Holmes at March 10, 2009 6:07 PM
Comment #277324

Craig Holmes-
I just ****ing hate arguments that rely on morale. I wish the soldier all the best, and I hope they feel as good about their mission as they can, but if you ask me, this defensive citation of morale as a defense to serious questions about policy and strategy strikes me as an insult to their sacrifice.

Soldiers seeing their folks die in poorly armored vehicles… what do you think that did to morale? Soldiers seeing places they had cleared fall back into enemy hands as soon as they left… what do you think that does to morale? Being unable to prevent ethnic and sectarian cleansing… What do you think that does to morale? Seeing your friends who got shipped back home treated in squalor… that does the trick for morale, doesn’t it?

It pisses me off that people preach to me about morale. It seems to treat our soldiers as delicate flowers who can’t withstand the thought that at home, not everybody agrees with the war. Accounts I heard from soldiers were often just as critical of relentlessly cheery war supporters, as those who opposed the war.

We needed to get the G—damn war right, not walk on eggshells trying not to discourage the troops with hard discussions on the homefront about what was going on, because it is inherently in politicians interests back home to downplay problems, to avoid situations where they might get blamed for something.

Now what Reid said may have been inartful, but it reflected a lot of opinion at the time. Do you seriously think that before Reid opened his mouth that everything was nice and rosy? Republicans attacked Reid because they self-centeredly like portraying every Democrat who doesn’t agree with a war like Jane Fonda. They’ll even do that to a triple amputee vet who earned the right to have an opinion on military matters the hard way.

I don’t play these ****ing games with subjective crap like this. The most important parts of the war regard logistics, equipment, leadership, and proper intelligence. these are far more measureable, and if they’re working well, morale is easy as hell to maintain. If they’re not, then a critical CNN story is going to be the least of his concerns.

It’s my honest belief that because the media tippy-toed around these matters, hoping not to be seen as against the military or against this or that, the soldiers were done a disservice. Because talking points were bought and not questioned, people died as equipment, vehicles, living quarters, and a variety of other matters were neglected.

It’s not always pleasant, and I don’t think the soldiers always quite enjoy it, but it’s necessary, because otherwise you invite spineless cowards at the top of the chain of command to use the brave, resourceful soldiers at the bottom as human shields which they put in the way of their own accountability.

Also, what do you think? That the dissent just goes away? That people stop thinking poorly of the war? It’s unrealistic to think especially as things escalate and more blood is shed, after a number of painful years of war, that people will just become sweetness and light about it.

When will you realize that the soldiers have nothing to gain from a bunch of self-righteous media figures insisting that everybody just shut up and go along with the plan? This is a Democracy. The command of our military ultimately ends at a civilian’s desk. That civilian is accountable to the American people. It is fair game to talk about these thing. The more you try to force things otherwise, the more you simply create frustration and opposition.

People like me care about the soldiers more than any possible hurt feelings. We care more about keeping them from dying needlessly owing to chicken**** politicians and bureaucrats than we care about having soldiers not hear anything discouraging on the front. This is the real world. Stop trying to make things run according to some fantasy of a free society completely agreeing with a war.

Posted by: Stephen Daugherty at March 10, 2009 6:42 PM
Comment #277325

Craig Holmes-
You will find that I’ve never denied their role. I don’t work like that. However, I give credit where credit is due: These people were centrists following the Republican cue in the age of Reagan and Gingrich. Triangulation.

What you shouldn’t deny is that your people have yet to abandon this ideology. Quit with this crap. Just because somebody followed your people with these bad ideas, doesn’t mean that your party wasn’t the nerve center for them. Take Responsibility, acknowledge the poor results, and think of some other position.

Posted by: Stephen Daugherty at March 10, 2009 6:45 PM
Comment #277326

Stephen:

I will be happy to take joint responsibility with you on this one. Looking at the youtube videos it was Republicans looking for more regulation and Democrats fighting it.

Looking forward there is a huge problem. It’s hard to put the needle where it belongs!! I am thrilled to hear a Democrat (Conrad) say there aren’t enough votes to pass Obama’s dangerous budget.

I think we will be fine as soon as Obama looses a bit of his self righteousness. Like it’s a shock that the markets are down after how the left has been speaking down with contempt on those in the top 5%!! Of course the top five percent own over 50% of the shares of our companies, which have constitutional protection.

Once Obama backs off the way Clinton did, the economy will start to recover. We may need the needle a little to the left, but obama’s budget is jerking the needle to the left. Aint gonna happen. All that does is change the problem we face from stopping Bush to stopping Obama. Obama will be stopped. The markets wont let him do his plan as campaigned. The question is, are you willing to compromise?

Posted by: Craig Holmes at March 10, 2009 6:58 PM
Comment #277327

Stephen,

Do you really don’t need to worry about what the Republicans would want to do? Obama doesn’t need a single Republican to pass his agenda. The Republicans have made themselves completely irrelevant so I’m not sure why you even care to make these kinds of arguments about what the GOP and conservatives need to do.

But I wonder why Obama is intent on creating a new socialist healthcare system entitlement when the economic crisis is so paramount? Shouldn’t he be focusing on stabilizing the stockmarket and the financial sector?

The dogma of socialized healthcare is probably going to do more to slow down growth of the economy than anything else besides the next 4 trillion dollar federal budget.

Posted by: eric simonson at March 10, 2009 7:16 PM
Comment #277328

Stephen:

I took another look at your response. The problem I have as a moderate republican is that Obama doesn’t give me a place to hang on to. I’m fiscally convervative and do not believe growing government is the answer. I also resent Obama using this crisis to move his liberal agenda.

Obama is trying to do something that hasn’t been tried since Rosevelt. (radically growing government). No I don’t want to redebadt Rosevelt. I do want you to understand that I have no part in what Obama’s agenda truely is. Traditionally, well at least since the end of WWII, America has spent about 20% of gdp on federal expenses. The military budget has gradually declined and social spending has gradually expanded. Obama wants no part of that, his budget appears far more about expanding liberalism that about the fiscal crisis.

Count me in on solving the crisis. Even if the way it is done isn’t my favorite way to do it. However, it is impossible to figure out what is related to the crisis, and what is just liberalism.

I’m out. I would far rather have a longer recession and stop Obama’s liberalism that compromise my beliefs to get us out in a shorter amount of time. I am so angry about how dishonest Obama is with the bait and switch. Using a crisis for political purposes!!

(This after enduring the left’s criticism of Bush doing the same)

Obama is simply politics as usual only this time from the left.

Posted by: Craig Holmes at March 10, 2009 7:22 PM
Comment #277329

Stephen,

Whooosh! It went right over his head…

Posted by: Marysdude at March 10, 2009 7:24 PM
Comment #277330

>The question is, are you willing to compromise?
Posted by: Craig Holmes at March 10, 2009 06:58 PM

>I would far rather have a longer recession and stop Obama’s liberalism that compromise my beliefs to get us out in a shorter amount of time. Posted by: Craig Holmes at March 10, 2009 07:22 PM

Yeah! Stephen, you do the compromising, I’ll do the stonewalling…that oughta fix things up…right???

Posted by: Marysdude at March 10, 2009 7:31 PM
Comment #277331

Hey, Warren Buffet kind of makes the same point about the bait-and-switch that this ‘new kind of politician’ has been making:

BUFFETT: …And, Joe, it—if you’re in a war, and we really are on an economic war, there’s a obligation to the majority to behave in ways that don’t go around inflaming the minority. If on December 8th when—maybe it’s December 7th, when Roosevelt convened Congress to have a vote on the war, he didn’t say, `I’m throwing in about 10 of my pet projects … [snip] …

JOE: Yeah, but you might—might not have fixed…

BUFFETT: But I say…

JOE: You might not—you might not have fixed global warming the day after—the day after D-Day, Warren.

BUFFETT: Absolutely. And I think that the—I think that the Republicans have an obligation to regard this as an economic war and to realize you need one leader and, in general, support of that. But I think that the—I think that the Democrats—and I voted for Obama and I strongly support him, and I think he’s the right guy—but I think they should not use this—when they’re calling for unity on a question this important, they should not use it to roll the Republicans all.

JOE: Hm.

BUFFETT: I think—I think a lot of things should be—job one is to win the war, job—the economic war, job two is to win the economic war, and job three. And you can’t expect people to unite behind you if you’re trying to jam a whole bunch of things down their throat. So I would—I would absolutely say for the—for the interim, till we get this one solved, I would not be pushing a lot of things that are—you know are contentious, and I also—I also would do no finger-pointing whatsoever. I would—you know, I would not say, you know, `George’—`the previous administration got us into this.’ Forget it. I mean, you know, the Navy made a mistake at Pearl Harbor and had too many ships there. But the idea that we’d spend our time after that, you know, pointing fingers at the Navy, we needed the Navy. So I would—I would—I would—no finger-pointing, no vengeance, none of that stuff. Just look forward. ..[snip] …

BUFFETT: Well, I was going to mention to Joe that you’ve heard this comment recently from some Democrats recently that a `crisis is a terrible thing to waste.’

BECKY: Yeah.

BUFFETT: Now, just rephrase that and since it’s, in my view, it’s an economic war, and—I don’t think anybody on December 7th would have said a `war is a terrible thing to waste, and therefore we’re going to try and ram through a whole bunch of things and—but we expect to—expect the other party to unite behind us on the—on the big problem.’ It’s just a mistake, I think, when you’ve got one overriding objective, to try and muddle it up with a bunch of other things. CNBC.com interview transcript via kaus files on salon.com

To which Rush Limbaugh said today that if this is an economic war… then the war is lost. Just so you understand the reference- here is the video of Senate Majority Leader Harry Reid (D) saying that the war is lost.

Posted by: eric simonson at March 10, 2009 7:32 PM
Comment #277344

Eric Simonson-
First, let’s drop the “-ists” and the “-isms” They don’t describe the problem all that well. We need to do something, because everything that Republicans like you threatened would come true under government healthcare, has in fact come to pass under free market healthcare. Costs have exploded, care has worsened, and employers aren’t hiring so many people on account of these costs.

Whatever the hell we call it, we need something better than we have now.

Craig Holmes-
We’ve been compromising for the last couple generations. We went with wars, went with shrinking the government went with free market policies. We went with much of Bush’s policies, the party essentially folding like a cheap suit any time it was challenged.

Why is it now our turn again to compromise? Did we lose an election? Did events discredit and deal a blow to our theories? Was it our President who just spectacularly self-destructed the party?

As a person who has seen both sides of the argument, I don’t mind Obama reaching out to you guys. But when is it going to occur to you that it is your time to compromise now? That all this stonewalling only serves to make people less willing to accommodate you? You’re using strategies suited to a party that had solid majorities in Congress, and a President elected to the White House.

Why do you expect them to be worth much now? People willing to lend votes to legislation can make greater demands than those who will, without exception, oppose that legislation. Why should we, the majority party, water down legislation (like we did with the stimulus) When we’re not going to get anything out of it? Give and take, man. Give and take. Compromising on ideals is tough, but I’m sorry: from experience, I can tell that this is the nature of being in a minority.

Obama won with an obvious mandate. Republican congressional numbers are tanking, even as they escalate the attacks, while Obama’s remain high.

These are extraordinary times, and the Republicans have had their crack already at solving the problem. They made it worse, opposed regulating what Banks could do with the money from TARP, and let Lehman Brothers collapse. The Republicans just don’t have a playbook for handling a deflationary crisis.

You’re following their rhetoric, and their rhetoric follows notions of how to get out of recessions that were mainly inflationary in nature, driven by energy crisises and tight monetary policies.

We’re not going to get out of this through the methods the Republicans are prescribing.

Posted by: Stephen Daugherty at March 10, 2009 9:55 PM
Comment #277361

Stephen,

The Republicans are prescribing methods on how to get out of the recession? I didn’t think most of them even understood we are IN a recession. To hear most of them talk, you’d think this thing we’re in was a blip on the world economic scene…they don’t think we should actually DO anything, and if we insist on DOING something, we should lower taxes (because lowering taxes always works, especially if the lowering is for the wealthiest among us), or deregulate some more (because history has shown that the free-market, running amok, is what stabilizes the economy). Republicans don’t think beyond that.

Posted by: Marysdude at March 11, 2009 2:22 AM
Comment #277363
has in fact come to pass under free market healthcare. Costs have exploded, care has worsened, and employers aren’t hiring so many people on account of these costs.

Free market? We don’t and haven’t had a free market healthcare system for over 30 years… Government protected monopolies are not ‘free market’. What we have is more free market than what may be being suggested, but that doesn’t make it free.

Whatever the hell we call it, we need something better than we have now.

Couldn’t agree more. The question is what. What we don’t need is something WORSE than we have now. Many people feel that what is being suggested is just that, worse.

went with shrinking the government went with free market policies. We went with much of Bush’s policies

Stephen, please do me a favor.

Please write for here for all to see, what years the government shrank. List the years where we had fewer government intrusion, fewer federal spending, fewer laws on the books from previous years.

Government shrank? Free market? I feel like Inigo Montoya asking “You keep using those words, I don’t think they mean what you think they mean”…

Posted by: Rhinehold at March 11, 2009 3:04 AM
Comment #277366

BTW, nice article on the mess that government has made in the financial market and how it may be too late to fix the mess that suspending M2M accounting six months ago may have been able to alleviate.

http://www.realclearmarkets.com/articles/2009/03/marktomarket_doesnt_destroy_it.html

Posted by: Rhinehold at March 11, 2009 6:57 AM
Comment #277373

Good use of the word, ‘may’, Rhinehold. Using logic, it is just as true a statement, to borrow your words, to say: “and how it may NOT be too late to fix the mess that suspending M2M accounting six months ago may NOT have been able to alleviate.”

Logically valid and true. So, does this modified version of original statement render your statement equivocal, or the modified statement equally valid?

There are two was to approach efforts to solve our crises. As a United States of people with a common vested interest in resolution, or, as short sighted individuals whose differing preferences for manner of resolution are far more important to them than solving the crises as a united people in a manner chosen by the elected officials charged with that choice.

It is pretty easy to spot in the comments on this and many other blogs, which camp participants fall in. One of the beauties of 2 and 4 year elections is that discordant voices don’t have much ability to impede government follow through on solving problems. Of course, the converse is also true, they they don’t have much power to halt government action obviously headed in the wrong direction either between elections. A case to be made for referendums.

Posted by: David R. Remer at March 11, 2009 7:53 AM
Comment #277378

Rhinehold-
Mister, you’re confusing the point. I believe I was saying that Democrats were showing a lot of deference towards Republican ideology in the last three decades. Are you trying to argue with me that President Clinton and other Democrats weren’t triangulating, weren’t letting Republicans go through with their deregulation and everything? *sigh*

What you’re saying is arguable: government didn’t shrink, and in some ways didn’t become less intrusive. In other cases, though, government enforcment and regulation were slashed, or rewritten in an industry friendly fashion.

But that’s hardly what people were calling it. It’s a misleading shorthand, but nonetheless the standard shorthand for what was being done.

Let’s call it industry-friendly regulation instead of deregulation. Let’s call it co-opted government instead of small government. The effect is the same, whatever you call it. We created a system where fewer checks and balances were placed upon business. You liked that, because you think of things in Libertarian terms, but the consequence of that is a system where Business takes the place of Government in becoming what you hate.

Let me explain. Can you not say that Healthcare has become as expensive and bureaucratic as it was going to be under the government? Can you not say that Walmart does as much as any treaty to ship jobs overseas, because it’s market share and leadership force that outcome?

In truth, we are not and cannot ever be again the society we were before the Depression, or even the beginning of this century. I mean, if we stopped telling auto manufacturers how they could make their cars, how long before the pollution, the low mileage and crash safety became issues for the public?

You might respond that the market could drive the same things. But what if the market essentially priced cars so much lower that it became too painful for people to pay the premium required for safety, good emissions and the rest?

My basic principle about regulation and government interference in business is that the market has a tendency, especially with bean counters in management of these companies to protect dysfunction when it’s obviously cheaper than handling the problem. The very paradigm of regulation over the past few years has been problematic for that very reason. When government is unwilling to harm a bottom line when conditions otherwise call for intervention, then government finds itself being a bystander for all kinds of scandals and catastrophes.

But of course, active intervention probably strikes you as problematic. You’re a libertarian on the Right Wing, so I don’t blame you. But let me pose this to you: the best way to keep regulation and intervention to a minimum is to create a system where the implicit authority of the government is respected, and the laws are shaped to prevent the kinds of catastrophes that convince people that more must be done.

Industry, over the last three decades, has become so arrogantly opposed to regulation that even the mention of it sends them into a murmur. How dare Obama regulate us? We’ll pull a John Galt, go into capital flight. Folks like them are, even in the wake of a financial catastrophe like we’re in now, still thinking that they should be allowed to do what they please, still resisting any checks and balances.

The operative question, though, is what the effect on the markets will be to have so much destruction, and how much patience the American people will have, as things inevitably get worse before they get better, for such industrial snobbiness. This is not a fight industries can win from this particular place on the battlefield. They’re against regulation in a way that will only tell people that there should be more.

In my view, only a balancing of interests, worked out in cooperation, not conflict or competition between the average person and the corporation, will work. Americans will vote their interests, and they will ask and soon shout for those in government to lay down the heavy hand of regulation.

Americans let things get lax over the last thirty years because they rarely felt enough pain in the markets for long enough to feel like laying down the law. It will be different this time. The only way to maintain greater freedoms, and relatively fewer and weaker regulations is to concede things up to the point where people feel safe and secure again, and then to demonstrate to people that they aren’t out of control incompetents who don’t care if they bring down the house as long as they profit.

Posted by: Stephen Daugherty at March 11, 2009 8:13 AM
Comment #277401

Stephen:

Why is it now our turn again to compromise? Did we lose an election? Did events discredit and deal a blow to our theories? Was it our President who just spectacularly self-destructed the party?

Because if you don’t comnpromise you will be thrown out of power again.

America is right of center, and you are liberal, so the way you hold on to power is by compromise. You have to have a coalition with the middle in order to govern. If you stay left, the right will build the coalition and take back power. It’s nothing personal, it’s just facts.

Posted by: Craig Holmes at March 11, 2009 1:00 PM
Comment #277416
There are two was to approach efforts to solve our crises. As a United States of people with a common vested interest in resolution, or, as short sighted individuals whose differing preferences for manner of resolution are far more important to them than solving the crises as a united people in a manner chosen by the elected officials charged with that choice.

No, there are more than two ways. I’m sorry that you have ‘drank the water’ so to speak so that you now view all who disagree with the measures being taken by this administration as short-sighted obstructionists. I tended to hear a different tune by you when you disagreed with an administration that you didn’t agree with. In fact, you are sounding much like the ignorant Bush followers who claimed anyone who didn’t agree with the Bush administration was a ‘traitor’.

If a person believes that a course of action will make the issues we have WORSE, in both the short and long term, isn’t it their duty to oppose those actions? Is that ‘short-sighted’ of someone?

I think that one real positive of the change in administration is that we can see how people react…

Posted by: Rhinehold at March 11, 2009 2:34 PM
Comment #277418
Mister, you’re confusing the point. I believe I was saying that Democrats were showing a lot of deference towards Republican ideology in the last three decades. Are you trying to argue with me that President Clinton and other Democrats weren’t triangulating, weren’t letting Republicans go through with their deregulation and everything?

I’m not trying to argue it, I’m stating it as fact. Let’s see, accusing Republicans of tyring to kill old people, taking food out of the mouths of children, etc… Yeah, they were pushovers.

Come on Stephen, one of the advantages I have of not being either Republican or Democrat is that I don’t have those partisan blinders on and have seen some pretty awful and nasty things done by both parties in the past few decades.

Heck, this one article is a GREAT example.

Speaker Newt Gingrich and Vice President Al Gore got into a shouting match last week at the White House, accusing each other of making dastardly attacks that poisoned the political atmosphere.

In doing so, they provided the most dramatic evidence yet that when it comes to the budget, the level of debate is getting in the way of serious discussion of the issues. The oral brawl on Wednesday, which left some bystanders wondering whether punches would be thrown, began when President Clinton changed the meeting’s subject from Bosnia to the national debt and asked where everyone stood.

At last week’s meeting, Mr. Gore responded to Mr. Gingrich’s complaint by saying that at least the Democrats had not accused the Republicans of being responsible for the drowning of two innocent children in South Carolina.
A couple of weeks ago, apropos of Republicans and Medicare, Mr. McCurry said: “Eventually they would like to see the program die and go away. You know, that’s probably what they’d like to see happen to seniors, too.” Mr. McCurry apologized promptly. Earlier, after sabotage had caused a train wreck in Arizona, Mr. McCurry said of the Republicans’ spending cuts, “What the Republicans have done is basically they took the bolts out so that the train could run off the track.”

The debate in the House, where Mr. Gingrich once set the standard for vitriol, has been equally acid. Representative Sam M. Gibbons, Democrat of Florida, said, “G.O.P. stands for ‘Get Old People,’ ” and outside the chamber Mr. Gibbons called Republicans “dictators” and “fascists.”

Mr. Gingrich has used the House floor for the sort of attack he now decries for more than a decade. These days, he throws the adjective “dishonest” around nearly as much as he says “preserve and protect” to describe his party’s plan for Medicare. In one recent usage, he said, “For labor unions and liberals to deliberately try to frighten 75- and 85-year-old people with deliberately dishonest ads is just beyond any moral decency.”

Yeah, all warm and fuzzy those guys were with each other…

Posted by: Rhinehold at March 11, 2009 2:48 PM
Comment #277420
Let’s call it industry-friendly regulation instead of deregulation. Let’s call it co-opted government instead of small government. The effect is the same, whatever you call it.

Actually, it isn’t the same. Which is sort of my point…

We created a system where fewer checks and balances were placed upon business. You liked that, because you think of things in Libertarian terms, but the consequence of that is a system where Business takes the place of Government in becoming what you hate.

You’re making an assumption here. You are assuming that I am an anarcho-libertarian, which is not true. I am a true Libertarian, not a quasi-anarchist with Republican leanings..

The difference is that I believe in anti-monopoly laws, no corporate welfare, etc. I also believe that business regulation, when necessary, should be in place. The key is that there be fewer laws, but those laws are well known and the punishments be severe and swift. And I mean that of all areas of our lives, fewer laws but strong ones. And this futher allows for adequate enforcement with limited resources.

But you said one thing I wanted to address. You say that we would go from Government being what we hate to Business. Remember, the main thing is that Business holds no control over our individual lives. A business CANNOT take away our ability to walk around free, to breathe, to live.

That’s the real key, one that many people don’t comprehend. I think if they saw this truth that things would be much different.

But you are right, people will keep voting themselves more of someone else’s money as long as they can, right up until the time of the system’s collapse… It’s inevitable unfortunately.

Posted by: Rhinehold at March 11, 2009 2:56 PM
Comment #277423

Craig Holmes-
That’s not a fact, that’s a claim, and one you’ll have to back up. Where’s the cry for Democrats to compromise further? What does it say that Congress’s approval ratings have doubled since they started passing liberal legislation?

The Republicans and their policies are not popular. What’s the political draw in compromising any further with those?

The Republicans are the ones badly in need of compromise. You can say the Democrats need compromise to keep their coalition. What about the Republicans, who have utterly lost their ability to appeal to the middle, who generally poll in the twenties and thirties, if not lower?

What is so center-right about a country where Republicans poll so lowly, especially now that they’re expressing their right-winginess so profoundly? Why is the take away from an environment where Republican unpopularity is extreme that the country is center right and the Democrats need to get with the program?

I would think that the onus would be on those who are being stubbornly contrarian. We already compromise. The time has come for the GOP to realize that it must do so, too.

Posted by: Stephen Daugherty at March 11, 2009 3:05 PM
Comment #277427

Rhinehold said: “And I mean that of all areas of our lives, fewer laws but strong ones. “

Fewer laws must mean broader, less specific laws, which, as we have seen time and again, leave tunnels and bridges and detours below, above, and around the law.

Example. Thou Shalt Not Kill. Simple, elegant, and entirely unworkable as a law, because their are too many exceptions where killing will be perceived by the majority to be both justified and righteous.

I think a more practical approach which would also reduce the number of laws, somewhat as a consequence, is to review, find, and erase contradictory laws, laws aimed at personal private behavior with virtually no consequence to neighbors or society.

The enormous contradiction between legal alcohol and illegal pot is one which costs our society up to a billion dollars per year. And that is just one.

But, Rhinehold, since our current lawmakers make the cluttered complexity of laws we now have, the question is begged, who should be charged with reducing and simplifying our laws, in the absence of a mandate from the majority of citizens. Otherwise, such a suggestion is purely academic.

Posted by: David R. Remer at March 11, 2009 4:00 PM
Comment #277429

Rhinehold said: “No, there are more than two ways.”

Very likely. But, NO ONE said there were ONLY two ways. Only that there are two ways. There can be no logic from those who fail to comprehend the meaning of words and language. “Only humans are capable of logic, and damned few of them in evidence.” (Mark Twain, I think.)

Posted by: David R. Remer at March 11, 2009 4:06 PM
Comment #277447
The Republicans and their policies are not popular. What’s the political draw in compromising any further with those?

Where is your evidence of this? I see a lot of contradictory evidence of that, including:

59% Still Believe Government Is the Problem

Thursday, February 26, 2009 In early October, as the meltdown of the financial industry gained momentum following the collapse of Lehman Brothers, a Rasmussen Reports national telephone survey found that 59% of U.S. voters agreed with Ronald Reagan that “government is not the solution to our problem; government is the problem.”

Since then, the stock market has fallen roughly 3,000 points, millions of jobs have been lost, nearly a trillion dollars has been spent so far to bail out the financial industry, an additional $787-billion government stimulus package has been approved, and a new president has taken office who has proposed spending billions and billions more.

Despite all that, a new Rasmussen Reports telephone survey shows that the basic views of the American people have not change: 59% of voters still agree with Reagan’s inaugural address statement. Only 28% disagree, and 14% are not sure.

23% Think Government Represents Will of the People

Monday, March 09, 2009 Less than a quarter of Americans (23%) believe the federal government truly reflects the will of the people.

The latest Rasmussen Reports national telephone survey found that most adults (63%) disagree, while another 14% are undecided.

65% Hope Government ‘Cure’ Doesn’t Make Things Worse Friday, March 06, 2009 Edward C. Johnson III, chairman of Fidelity Investments, said recently of government efforts to jump-start the economy, “We can only hope that the government’s cure doesn’t further sicken the patient.”

Sixty-five percent (65%) of U.S. voters agree with Johnson in a new Rasmussen Reports national telephone survey. Fifteen percent (15%) disagree, and 20% are not sure if he’s right or not.

Since President Obama and Democrats in Congress are leading the way on the multi-billion-dollar efforts to stimulate the economy and bailout the financial and housing sectors, it’s no surprise that Democrats are less supportive of Johnson’s analysis than Republicans and voters not affiliated with either political party.

54% Say ‘No’ To All Bailouts Tuesday, February 24, 2009 Bailouts, bailouts everywhere, and not an end in sight.

The automakers want more, the banks want more, even the nation’s biggest insurance company is back because its $150-billion bailout last year wasn’t enough. And what about the people who can’t pay their mortgages? Taxpayers are beginning to wonder if the U.S. Treasury is going to run out of money.

So what do Americans think about all these bailout requests?

Given the choice between federal bailouts for the auto companies, the finance industry and financially trouble homeowners or no bailouts for any of them, 54% say no bailouts period.

Just 26% support bailouts for all three, according to a new Rasmussen Reports national telephone survey. Twenty percent (20%) aren’t sure which course is better to follow.

Investors, with their eyes on the financial markets, are even more strongly opposed. Sixty-two percent (62%) of investors say “no” to all three bailouts, with 24% who favor them. Twenty-eight percent (28%) of non-investors support the bailouts, but 45% are opposed.

Confidence as measured by the Rasmussen Investor Index hit a record low on Tuesday – for the second day in a row.

Posted by: Rhinehold at March 11, 2009 5:04 PM
Comment #277484

Rhinehold-
The question about the free market economy is a false dichotomy. It depends on a libertarian definition of free in free market (that is free of regulation, rather than government price controls that mark a command economy, which is the original meaning). The funny thing is, with all these questions is that the wording is very important. Generally, for the Government to take over a bank, and to nationalize it are essentially the same thing. But if you tell people you’re going to nationalize the big banks, as opposed to taking them over temporarily, people will flip one way or the other, with most a majority favoring the take over and opposing the nationalization! The Newsweek poll, when explaining that this pair of choices is really one choice sees overwhelming support for what even Democrats a year ago would have branded socialism.

You ask people, should Wall Street be regulated? Most will probably say yes. Of course, you could word the question to play on people’s insecurities about government, and thereby drive down the apparent support. But when you float the idea outright, in plain language, people support it.

The second survey you cite has a problem: no follow up questions, to clarify what people think. Given the result on Nationalization of banks, and the fact that “representing the will of the people” can mean any number of things, other questions are necessary. You could chop it up by party, ask whose direction you think works best. That might clarify what people believe the government’s will means. You might ask questions concerning whether people think this administration better represents the will of the people than the last one, or provide a range of options rather than just a yes or no answer. You know, Very much, Somwhat, not so much, not at all, neutral… you get the picture.

The last one is an understandable, but ultimately politically ambiguous hope. It doesn’t take a Republican to hope that the cure to the economic problems we have isn’t worse than the disease, but then again, you can wish that (as I do) without believing that Barack Obama’s economic program is so problematic as to be guaranteed to be that bad. Number two question on that third survey is a leading question, but even so, people are effectively split on the question of FDR making things worse.

Rasmussen is famously right-wing as a survey group, and the wording of these questions and the lack of clarifying follow-ups is a problem for people making generalizable claims. Also problematic is the fact that if you look at other surveys, you’ll see broad support for basic priniciples of the Obama administration’s response. It’s the loading of meanings on certain words and phrases that often makes for shifts away- a sign of success on a rhetorical level, but failure on a philosophical language. You can lead the American people to agree with a particular catchphrase, but you can’t get them to buy into it further than the superficial wording.

Let me now say something to the subject of investor reactions to Obama.

I think it’s far too soon to start accusing Obama of being poison to the Dow Jones. I think, if we’re talking subjective effects, the Republican’s bitterly scathing promises of economic decline on account of Obama’s changes in the tax structure and the regulatory system have had more drag on those numbers than anything Obama’s said, much less done.

I have thing about not liking measures of any kind that depend upon such short-term twitch responses as the DJIA. The economy beyond Wall Street was going downhill long before Wall Street Collapsed. Yet you didn’t see much of that in the DJ’s response. There are many times when stocks have fallen off cliffs without the result of recessions in the economy as a whole. Neither taxes nor Regulation have gotten in the way, in the past, of economic prosperity. Like those poll questions, our response is something of a triumph of rhetoric over factual study and memory. We have had times within the lifetimes of many reading where top tax rates were 50%, even 70%, rates that are confiscatory far beyond those of today, even under Obama’s plan (try in the high thirties, for the richest of us.)

Is this conventional wisdom on the right correct? I see no factual basis to accept their conclusions. We have prospered in times of greater taxation, greater regulation, and done just fine as a country. Ironically, this is the period many see as blissfully lacking in big bad government.

How much of the perceived negative role of government simply a by-product of years of somewhat successful propaganda? I would say much of it. I would also say that despite the heavily lowered expectations, people want a great deal out of government despite how they might respond to loaded questions.

Posted by: Stephen Daugherty at March 11, 2009 10:38 PM
Comment #277498

Stephen:

I think it’s far too soon to start accusing Obama of being poison to the Dow Jones. I think, if we’re talking subjective effects, the Republican’s bitterly scathing promises of economic decline on account of Obama’s changes in the tax structure and the regulatory system have had more drag on those numbers than anything Obama’s said, much less done.

Who says he is “poison to Wall Street?” He is just the latest new kid on the block who thought he could walk in and transform things by his very words and pen. Wall Street has seen many Obama’s come and go. Obama will moderate. He is a smart guy. Or he will be gone.

He has already caved on defense. McCain is applauding his troop withdrawals. I can’t tell any difference yet between what Obama has done and what Bush and McCain would have done in Iraq.
I suppose the words are a bit different, but the actions so far are about the same.

His Budget doesn’t have the votes to pass a democratic congress. Wow!!

Posted by: Craig Holmes at March 12, 2009 11:01 AM
Comment #277532

Craig,

Obama would not have been there, so withdrawal would not now be an issue…you can’t see the difference in WHAT???

Posted by: Marysdude at March 12, 2009 7:09 PM
Comment #277537

Craig, ooops! I think Marysdude has a winning point there. 15-Love.

As for Wall St. they cannot be treated as a monolithic group with a unified voice, an error committed by many. Some can’t wait for Obama’s regulations, others are quaking in their boots at the prospect, and still others are saying any plan to deal with the toxic asset balance sheets will be better than no plan at all. Then there are your Dem’s on Wall St., and your Repub’s, and Independents, each with differing perspectives on solutions. Then there are the old schoolers and young upstarts, the men and the women, the experienced and the educated and both together groups.

Nope, not a monolithic voice at all. The differences are as clear as Kudlow and Cramer.

Posted by: David R. Remer at March 12, 2009 9:59 PM
Comment #277538

Stephen, quite right about the Markets reactions. This weeks bear market rally is just that, not a reaction to exclusively to the administration, as the downward spiral was also due to many factors including impatience for a new president to rescue their butts from the CEO’s they invested in.

Appears to me, Geithner et.al. are working on an inordinately complicated problem with a solution as optimal as can be created with the least negative consequences. That is something one does not produce in a matter of days. Examining the longer term effects of various potential short term solutions requires an inordinate amount of time, modeling, and feedback form experts.

Investors are impatient, but, they are investors, day, hour, and minute traders. It is there nature to be impatient when microseconds for a trade to register is too long and can cost them thousands in fees and commissions.

They shouldn’t be ignored, but, their impatience damn well should be.

Posted by: David R. Remer at March 12, 2009 10:10 PM
Comment #277545

>They shouldn’t be ignored, but, their impatience damn well should be.
Posted by: David R. Remer at March 12, 2009 10:10 PM

DRR,

Truer words were never spoken. The stock market is an important economic tool, but that is all it is. It gathers together the where-with-all for trading. Every one knows how volatile it is, there has never been any question that it rises and falls on whims and fancies…and sometimes just superstition. When you look for long term solutions to current problems, stock market fluctuations have to be ignored.

Also to be ignored is the braying about ‘pretending to work on the economic collapse, while pushing a liberal agenda’. I can’t even imagine a fix of the economy without education, health-care and energy being part of that fix. The days of keeping Americans barefoot and pregnant and down on the farm are over. The days of expecting the health of the nation to continue its eleven plus percent inflationary climb to take care of itself are over. The days of relying on money from China to fund our flow of oil from the Mid-East are finally coming to a close. It has NOTHING to do with a liberal agenda, and EVERYTHING to do with our economic recovery.

I hope Americans never again listen to the dolts who espouse ‘do nothing, because the market will mend itself’, ‘quit spending taxpayer money on education, because the dumber Americans are the less work they are to herd’, ‘America has the best medical system, don’t mess with it’, and ‘drill baby drill’.

Posted by: Marysdude at March 12, 2009 11:42 PM
Comment #277553

Craig Holmes-
Did he cave on defense? I seem to remember him promising, pretty much, to do what he’s doing now.

I don’t think it’s smart to treat Obama as if he’s some young tyro, because a good look at his career shows somebody whose got some brain cells to spare, and who’s pretty much defeated those who have tried to beat him up.

I think what you have in the Democratic Congress is a greater spread of faction than you’d see with the Republicans, and so, making this comment as if this budget is too liberal for liberals is misleading. I think there are still some people who take arbitrarily fiscally conservative positions, even in times where the economic conditions don’t make them reasonable positions to hold.

Posted by: Stephen Daugherty at March 13, 2009 8:31 AM
Comment #277581

Stephen:

I don’t think it’s smart to treat Obama as if he’s some young tyro, because a good look at his career shows somebody whose got some brain cells to spare, and who’s pretty much defeated those who have tried to beat him up.

Never said he wasn’t smart. He is young and inexperienced. He will be fine in time. He just needs to be told no. He is being told that now. He will moderate.

Posted by: Craig Holmes at March 13, 2009 2:27 PM
Comment #277586

Marysdude writes; “The days of expecting the health of the nation to continue its eleven plus percent inflationary climb to take care of itself are over.”

Presuming that Marysdude is advocating NHC I would simply ask; with government now in command of around 50% of all health care delivery in the nation, and if we use his inflation claim of 11+% increases, should we then expect 22+% increases when government controls 100% of health care delivery?

If marysdude would answer NO…then I presume that he would welcome rationing to reduce costs.

Posted by: Jim M at March 13, 2009 2:59 PM
Comment #277594

I agree with Marysdude on this. Healthcare cost will bankrupt us if they continue.

Posted by: Craig Holmes at March 13, 2009 6:04 PM
Comment #277641

Craig, are you then in favor of health care rationing? If not, how else will you account for reducing costs if government delivers 100% of care?

PO flatly stated that he is in favor of wealth redistribution. Simply stated this means that we should take from some and give to others for no other reason than to accomplish something he thinks is “fair”.

NHC is exactly the same thing. By rationing care government will reduce the level of care for some and increase the level of care to others. It is happening right now in Europe in countries who have NHC. The quality of care in those countries is diminishing and the cost of the care is increasing. This is not a solution, merely an attempt by government to equalize everyone.

If equalization is the optimum goal among a people, why are libs not advocating government housing for everyone. Would this not be “fair”. Why not equalization of income? I am absolutely convinced that no liberal on this blog would advocate equalized housing or income…why then equalized health care? Why is this sacred?

That there are abuses in our current health care is obvious both in private and government delivery of that care. Let’s address that. There are better ways to deliver adequate health care to all people than to socialize it.

Posted by: Jim M at March 14, 2009 12:47 PM
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