Democrats & Liberals Archives

A Compelling Theory That Is Wrong

The Republicans say that the main reason we’re seeing such trouble with the job market is that regulations are strangling employment. The Democrats say that the reason we have such a problem with employment is that we lack demand. Who is right?

Bruce Bartlett has a rather unambiguous answer, and it might not be the one some would like or expect..

The trouble for your average Republican is that for all they make the case that it's regulation getting in the way of new jobs, the vast, and I mean vast majority of job losses are from the simple fact that there isn't enough demand out there.

What makes those job numbers so unambiguous? The sheer disproportionate relationship, really. There were something like 4,854 jobs lost in 2009 because of regulations. No, I didn't forget to add "thousands" to that. That's precisely how many. It's a fraction of a percent, .2 percent, actually.

But what about 2010? 2,971. This year, first half, has been 1,119. The proportion is steady, and tiny to boot. If five hundred people are laid off, just one, just one will lose their job because of regulations.

Lack of demand? For the same years, the numbers have been 824,834, 384,565, and 144,746. The first number is almost 40%, and the other numbers are about 30% apiece, of their respective totals.

If we're talking proportion, then it is fair to say that the first years layoffs were about 200, then 150 times more the result of lackluster demand than regulation.

So, if the Republicans are aiming at regulation as the big job killer, then they're sadly mistaken.

That, or they're trying to look concerned with the job market when they're actually after something else.

I mean, really. Is there actually a time when the answer to a question hasn't been "deregulate", when it comes to Republicans? Even when the actions or mistakes of the corporate class has clearly crossed some threshold of acceptable behavior, they're saying the best thing is to relieve them further of burdensome rules.

Maybe it's to their benefit not to have to concern themselves with the pollution, job safety, labor or other matters that a regulation might force them to confront, but is it cheaper for them for the right reasons? I mean, if everybody else is getting poisoned, broken by their jobs, made to work long hours for less pay, while their children and spouses end up neglected, well then, what are we doing? If the rest of us have to endure chronic unemployment, devaluation of our own property, the gutting of our retirement, etc, just to make sure that a few already rich men make even more money, then you'll have to tell me where the benefit's going to be in the trade-off.

It has been the nature of the rich and powerful to take advantage of those who are less rich and powerful than they. This is the simple nature of man, and it can happen whether the person is a lifetime blueblood heir, or whether they're just some schmoe that got lucky. Put somebody in a position where they're no longer responsible merely for themselves, and watch their estimation of their interests change.

This is not good or evil, it just is. What folks need to realize is that if they had looked after their interests earlier, if they had remembered and recognized the problems that came with the changes that those in the pay of the big corporations and the big rich folks wanted, they might not be in this position now.

Interests in this democratic republic of ours are meant to compete, not merely win outright, one way or another. You should not be always saying, "Oh, I shouldn't call for greater regulation, because I might lose my job."

When somebody's going with that line, they're typically trying to con you. The people who come up with these arguments aren't trying to be compassionate, they're trying to extort your will to stand up for your own interest, by essentially telling you, "know your place, or we'll take it from you when we don't get what we want."

By not dealing with those things, many people lost their jobs in the long run anyways, and for their deference, they've been put in even more desperate positions. The simple axiom would be, if you want something done right, you've got to do it yourself, for yourself.

I'm not saying we should just sociopathically define things in our own interests alone. Far from it. But we should learn to recognize when folks are just taking advantage of our anxieties, our prejudices.

As a person who studies storytelling, and does a little of it myself, I understand the ways in which reality is often compromised for the sake of an interesting story, or the presentation of an interesting story. So many of the things we see in movies, even the relatively realistic ones, are implausible or even impossible in the real world. But being fictional, such worlds and their representation can bring forth the impossible and the implausible with ease, with our imaginations often as their willing co-conspirators. I mean, our minds are built to be adaptable, capable of learning about and understanding many things. Since you can't evolve in anticipation of everything, we are evolved to being able to imagine things beyond what even the real world can present to us.

Now that's fine if we're entertaining ourselves, but when we're confronting the state of the real world, we need to be able to both imagine, and rule out certain stories, even if they are compelling. Science has brought us advancement at a pretty fast pace, simply by formalizing and improving that process of skeptical inquiry. Other disciplines benefit from it.

I know what it is to have a compelling set of beliefs, but beliefs are no replacements for truths. Each of us has an imperfect appreciation of the truth, so it is in our interest to improve on that, to learn, and shape our feelings by what we learn, rather than assume we know better.

I have already presented evidence that shows that job creation during the time of the Bush Tax Cuts was simply terrible. Even without taking away the jobs lost during his administration, his job numbers are little better than Reagan's first term, and about half of what Carter created in one term in the mid to late seventies. Think about that.

But still, Republicans insist on tax cuts as a panacea.

If a policy doesn't work, insisting on it won't make it work, it'll just make things worse. Of course, try telling the modern Republican that. Try telling a Republican who thinks they are fighting what is in all but name a communist fifth column conspiracy, who thinks that Democrats just want to ruin the economy, that they're wrong.

That's one reason their leaders have fed them that, by the way. Since they don't want to lose support, they have to push their followers to believe that something much worse will happen if they settle down and work reasonably with others across the aisle, if they admit defeat. But look at the extremity of it, the sheer, implausible paranoia of it all!

If you're having to scare people that badly, push them to that ridiculous end, then there's not much more room for denial left. People are going to figure it out, sooner or later, because other compelling ideas are going to come along, and these ideas will have the advantage of being backed by good logic and good evidence. People are already tired of the conflict, tired of the political chicanery. They want answers, and they want change for the better. They're not going to wait for this economy to recover, sooner or later they're going to demand that the government helps.

It worked before. It should work now. The era of anorexic government is over. We're going to return this government and this nation to a healthy weight, and a healthy attitude, where polices are based less on political hysteria, and more on theories constrained by the real world, and moderated by practice.

Posted by Stephen Daugherty at October 9, 2011 4:34 PM
Comments
Comment #330249

Regulations should be smart. They should apply to things like health and safety. They should not be too intrusive and they should as much as possible set goals w/o dictating the precise means to reach those goals.

These are also principles of good leadership, BTW. Good leaders empower their people to make decision within broader goals because they know that many people, close to the problem, will almost always come up with better solutions than a few people some distance removed.

Regulation is necessary, but should not be applied simply because somebody doesn’t like a situation.

Regulation need to be constantly reviewed and updated. They often are set to solve yesterday’s problems.

Regulations should have sunset periods. Otherwise they tend to experience accretion and develop constituencies.

It is very difficult to figure out the cost of a regulation in jobs or money and those who do it with precise generally are fooling themselves or trying to fool us.

Regulations tend to be conservative (with small c) since it is always easier to know the benefit of avoiding a cost than it is to figure out the cost of avoiding a benefit.

Regulations should never to used to achieve political goals. Having the power to regulate creates the temptation for corruption.

It is the nature of the rich and powerful to capture regulator and use them as offensive weapons to keep out less well connected or financed competitors.

These are some of the things I just could come up with on the spur of the moment. Others may add more. With these caveats in mind, by all means regulate when you need to.


Oh yeah - re the rich and powerful - the market is a lot harder on them than government. We have government “dynasties” even in Republics. Beyond that, even the most powerful businesses go out of business. A government program along with its bureaucracy can live almost forever.

Posted by: C&J at October 9, 2011 6:52 PM
Comment #330250

No, they should be in place only to ensure that the marketplace is kept free and balanced. They should not be in place to direct action or pick winners and losers. Unfortunately, that is precisely what Stephen is saying that they should be used for.

Posted by: Rhinehold at October 9, 2011 7:08 PM
Comment #330252

Rhinhold

BTW - welcome back.

Posted by: C&J at October 9, 2011 7:45 PM
Comment #330255

“No, they should be in place only to ensure that the marketplace is kept free and balanced.”

The corollary of that principal is that the markets will self regulate. Unfortunately, the experience of financial deregulation and limited discretionary regulatory enforcement under the Greenspan Fed and the Bush administration proved that assumption to be false. “..a humbled Mr. Greenspan admitted that he had put too much faith in the self-correcting power of free markets and had failed to anticipate the self-destructive power of wanton mortgage lending. http://www.nytimes.com/2008/10/24/business/economy/24panel.html This is what he specifically said:

“Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,”

“This modern risk-management paradigm [credit default swaps] held sway for decades,” he said. “The whole intellectual edifice, however, collapsed in the summer of last year.”


Posted by: Rich at October 9, 2011 9:21 PM
Comment #330258


What ails the U.S. job market is the freedom that business owners and investors now have to indulge themselves in the pursuit of the lowest priced labor. It is a situation which will probably have to be endured until the labor markets are united as one.

Posted by: jlw at October 9, 2011 10:00 PM
Comment #330263

Rich-
The assumption for self-correction is that there is just one ideal that the market will correct towards. Unfortunately for that theory, the reality is that there are any number of different economic states that we could actually end up to, from which the market will not necessarily correct towards something better.

Some folks wish for the economy to simply move towards the ideal, without intervention. But even Rhinehold’s forced to admit that some regulations are necessary to keep the shape of the market good. Why?

Because people cheat. Because some folks will speculate and gamble rather than invest. Because people can be and are deceived by those holding necessary information.

If you can put minimal effort towards winning your fortune, why bother with the uncertainties that come from competing with a real business in a real world, where you have to satisfy real customers?

One of the basic functions of government, since ancient times, has been to regulate commerce, and this has been necessary because the truths about people, the truths mentioned above, have been true since the time of Hammurabi. As long as people have sold things to one another, had money or belongings or other kinds of wealth, there have been those who simply try to gain those things by unethical or dishonest means.

Greed can distort any market, and it distorted ours in awful ways we’re still feeling three years on from the crisis that brought us down.

Our problem isn’t the uncertainty brought by regulation upon businesses. That is nothing compared to the uncertainty that has been brought by an economy that has left millions of consumers behind, sucking air, when consumers are essential to the function of the economy. There are not enough people getting the wealth spread to them to make America as productive as it needs to be.

People are uncertain about whether enough customers will walk in the door.

Rhinehold-
As for picking winners and losers? The problem is, with even necessary policies, there are winners and losers. There have to be. I don’t think that should be the typical thought, really. The thought should be, what reflects the public’s best interests.

The problem, with the markets on Wall Street being what they are, is that they’ll certainly be losers, given how they make most of their money, if real reforms, the necessary reforms are put in place.

Ah, but let’s sit down for a second and consider just what we’re doing when we issue a regulation. We’re really saying, do things a certain way, or you’ll end up a loser, even if what you were doing could be profitable. If a law can’t make the person misbehaving a loser, then the law is toothless, and useless to boot.

Besides, we’re talking about how Washington really is. The truth is, and people might find this shocking, is that even under Republicans, the governments messing around in things. What do you think all the tax breaks are?

It’s not a question of whether government intervenes, it’s how. Then, once we know how, then it’s a question, about what the main advantage being sought is. The government shouldn’t be in business simply to do the dirty work for a few businesses who can pay for the influence necessary. If the government’s going to issue policies with winners and losers, the ultimate winners, under whatever plan, have to be the American people in general. The public good has to be the first goal of the American government, and all it’s smaller governments. That sounds like a truism, like a cliche, but it’s the practical reality, and figuring it out is very complicated.

It’s easy to get sidetracked, to invest “the good of the people” into the good of a certain company or another. But those gains and losses have to be incidental to something greater, really.

Posted by: Stephen Daugherty at October 9, 2011 11:11 PM
Comment #330265
“No, they should be in place only to ensure that the marketplace is kept free and balanced.”

The corollary of that principal is that the markets will self regulate.

How is the ‘corollary’ to ‘we must have regulations of the market’ lead to ‘we don’t need regulations of the market’?

Unfortunately, the experience of financial deregulation and limited discretionary regulatory enforcement under the Greenspan Fed and the Bush administration proved that assumption to be false.

Please, there was little deregulation, please list all of these ‘deregulations’ that happened under Bush? I’ll provide some ‘regulations’ that were added under Bush and caused a big problem in 2008.

Mark-to-Market accounting principles
Sarbanes-Oxley
TSA/Homeland Security

http://www.heritage.org/Research/Reports/2008/03/Red-Tape-Rising-Regulatory-Trends-in-the-Bush-Years

As for picking winners and losers? The problem is, with even necessary policies, there are winners and losers.

Yes and no. Sometimes both sides win, sometimes both sides lose, but yes there are times when there are winners and losers in any economic transaction.

The thought should be, what reflects the public’s best interests.

That’s an interesting thought, one the Republicans seem to share with the Progressives. My question, why? Who’s business is it if two people enter into an economic transaction and one person, because he made a bad decision, lost his shirt? That’s his choice, his business, his life, not ours. WE don’t have that right or power to make those decisions for them, nor should we.

The truth is, and people might find this shocking, is that even under Republicans, the governments messing around in things. What do you think all the tax breaks are?

You are entirely correct there. The Democrats want to tip the scale to the side that they thing needs help and can’t figure things out on their own, the Republicans want to tip the scale to the side that will create a prosperous business environment. That is why we have such a mess. Sports teams and large companies holding cities hostage in order to get their jobs in town, Unions trying to get everyone as a member whether they want to or not. It’s all tied to the same flawed philosophy that somehow the market is a tool for them to shape outcomes, not provide a stable marketplace for people to exchange opportunity costs with one another free from fraud and excessive costs.

It’s not a question of whether government intervenes, it’s how.
No, that is where you are wrong, it *IS* a question of whether government intervenes.

The constitution was clear that the founders did NOT want the government involved in every little transaction between individuals, poking into every aspect of our lives. They didn’t want the totalitarianism that you are representing, Stephen.

Posted by: Rhinehold at October 9, 2011 11:31 PM
Comment #330271

Rhinehold-
Nobody’s going to make perfect decisions. Simply saying you’re going to make no decisions on that account is not realistic. The world will force decisions, and if you’ve put them off, you’ll probably have a crisis on your hands.

What has struck me, since I was a kid, is how some on the Right, and the libertarian end of things see failures that have more than just the single economic dimension, touch on so many other things that matter in the real world, but only see what is essentially the bottom line for some people.

I mean, we can look at cigarettes in terms of just the cost, but what about the distorting effect it has on our personality, the moral character of the health effects, etc? Why does the discussion about global warming always circle back to a claims that doing something about it will kill jobs, impose a socialist state, or some garbage like that? Never mind the paranoia involved in believing that ninety percent plus of climate scientists are all just trying to grift grant funds, let’s just concern ourselves of what it means if they’re right! We’re talking, eventually, the inundation of hundreds of thousands of square miles of American territory, changes in the weather that will fundamentally alter where and how we can grow our crops. What about the legacy we leave to our children? What about the destruction, one way or another, of the legacy that was left to us by our parents and forebears?

Look at that oil spill in the gulf. There are people who have to go begging, who can’t pass their livelihood to their children. There are miles and miles of coastline that were in our stewardship, now ruined for decades. Didn’t we have greater responsbilities than just their economic value? Isn’t it a form of moral cowardice to willingly overlook the bad thing that happened there, and just say, for the sake of some principle about picking winners and losers, that we shouldn’t reform regulations to make sure that these people are required to plan these things out better, do better?

Or put another way, why does the right keep on cheering on those who, after a crisis, keep pushing to be free to do what they did catastrophically wrong, ruining the lives of millions? The free market, I believe, cannot take the place of the rules of a civil society that well and wisely governs itself through the rule of law, and the participation of the masses in that government. We’re not just some mob to be staved off, we were the bulk of the people of this country, and our interests, on the many different levels they exist, should not be ignored, simply so a few can be free in some theoretical fashion to make as much money as they can rake in with their own two hands.

As far as the Constitution goes? It was preceded by a government that was much weaker, much more reliant on the the states and small parts of the government. It did much of what modern Libertarians would want it to do. But it was such a disaster that the system in question got chucked.

A government needs to have the strength to do what it needs to do, and the constraints to make sure that this increased strength is not employed in the wrong places. That’s my basic opinion: strong government, but strongly defined in its powers so that its power is not abused, and are not used beyond where they are justified.

I don’t believe a government can or should solve all problems. People have to solve some of their own.

I can’t claim to be able to work out all the details on that, on where freedoms should end and laws begin, or vice versa, but the basics, I would say, start with our civil liberties. That’s where I stand strongly for keeping government out of our lives. We don’t need every decision made for us.

However, we do need the ability as citizens to demand and get laws that prevent destructive market practices. A free market isn’t free because it’s lawless, it’s free because the bulk of the work of figuring out prices is left up to the market. However, if the market is badly distorted by the behavior of private actors, as it was in the case of the 2008 crash, and the recession it accompanied, then our market economy won’t work so well to our advantage.

I think we need to define out of legitimacy that behavior which leads to such distortion. We need to take the house of games mentality out of Wall Street. Their job is supposed to be making it easier for America to function economically, but because of their mistakes, they’re actually doing the opposite. Neither the financial sector, nor any other sector, should be allowed to serve as a millstone around our economy and our societies neck.

Posted by: Stephen Daugherty at October 10, 2011 8:09 AM
Comment #330272
Nobody’s going to make perfect decisions. Simply saying you’re going to make no decisions on that account is not realistic. The world will force decisions, and if you’ve put them off, you’ll probably have a crisis on your hands.

I don’t think I’ve ever suggested that someone will make perfect decisions. We are human beings, perfection is not a part of us.

What has struck me, since I was a kid, is how some on the Right, and the libertarian end of things see failures that have more than just the single economic dimension, touch on so many other things that matter in the real world, but only see what is essentially the bottom line for some people.

That may be your invalid interpretation, but it isn’t true. You may disagree with the way we view the world, but trying to suggest that because we don’t see it the way you do is getting it all wrong and preventing you from understanding those you disagree with.

I mean, we can look at cigarettes in terms of just the cost, but what about the distorting effect it has on our personality, the moral character of the health effects, etc?

I am very well aware of those costs, but those costs are those that the smoker should make the choice of, not anyone else. My father has emphysema and can’t breath very well, just shy of 70 years old, but that was his decision to make and his alone.

Why does the discussion about global warming always circle back to a claims that doing something about it will kill jobs, impose a socialist state, or some garbage like that? Never mind the paranoia involved in believing that ninety percent plus of climate scientists are all just trying to grift grant funds, let’s just concern ourselves of what it means if they’re right!

You mean the chicken little philosophy? Isn’t that the same philosophy that religious people want to use to try to get you to believe in a god? “If there is no god, there is nothing you can do, but what if the christians are right?”

The problem with ‘global warming’ has never, to me, been about the economic costs. It is the fact that I have a skeptical nature and there is just too much here that doesn’t ring true to me. I’ve also got just about enough physics knowledge to be dangerous, but it also helps me see flaws in much of what is touted by non-scientific individuals. An example in the next part.

We’re talking, eventually, the inundation of hundreds of thousands of square miles of American territory, changes in the weather that will fundamentally alter where and how we can grow our crops.

And your assumption is that that is a bad thing. There is too much here that we are GUESSING about. Did the global temps rise in the 80s and 90s? Yup. Did they not rise in the 00s? Yup. What does that mean? What are the driving factors, what do we not know. What was the global temperature when the earth was warmer than it is now (and helped spur the Renascence?

I’m not the kind of person who is willing to forcibly take money (which is a representation of the time, work, sacrifices in an agreed upon currency) from someone else on guesses, just to feed the wallets of others.

What about the legacy we leave to our children? What about the destruction, one way or another, of the legacy that was left to us by our parents and forebears?

Don’t you usually eschew these same concerns when the notion of ‘debt’ is brought up? That is a known quantity, not a guess… and yes, no matter how much you want to say it is ‘settled science’, the causes and effects of the global warming issue it is still at this point a guess.

Look at that oil spill in the gulf. There are people who have to go begging, who can’t pass their livelihood to their children. There are miles and miles of coastline that were in our stewardship, now ruined for decades. Didn’t we have greater responsbilities than just their economic value? Isn’t it a form of moral cowardice to willingly overlook the bad thing that happened there, and just say, for the sake of some principle about picking winners and losers, that we shouldn’t reform regulations to make sure that these people are required to plan these things out better, do better?

You mistake the notion of regulations being able to PREVENT something. You can have all of the regulations in the world in place, but bad things are still going to happen. Look at the FDA, aren’t their regulations supposed to prevent things like Listeria?

I am in no way saying that we don’t make the penalties stiff so that people will not want to harm others, BP should be making those people whole. That is where our government needs to be, making sure of that. Trying to enforce something ahead of time that we can’t enforce (willful negligence) is folly and far more costly. And not just economically costly. If the regulations for doing something are so onerous that no one wants to get into that business, aren’t we putting more lives at risk and harming others by doing that?

Or put another way, why does the right keep on cheering on those who, after a crisis, keep pushing to be free to do what they did catastrophically wrong, ruining the lives of millions?

Not being ‘of the right’ I can’t answer that for you, but I have never done such a thing. When someone does something wrong and ruins the lives of millions, they should be on the hook to make those lives whole. Unfortunately, that is not what the right or left in this country care about…

You can look at the Libertarian Party to see how they view dealing with environmental issues, it is NOT ‘people can dump garbage on my property’…

The free market, I believe, cannot take the place of the rules of a civil society that well and wisely governs itself through the rule of law, and the participation of the masses in that government.

You make the illogical conclusion that ‘free market’ means an absence of law or regulation. The rule of law is the only thing that can make the market free. By ensuring that no fraud is in play, that each side of an interaction is aware of the risks (nothing is hidden from them) and that any negligence is resolved by the party at fault, only then can we have a free market. You are talking anarcho-capitalism there and as far as I know the Republican party nor the Libertarians are led by those who subscribe to that thought, just as the Democratic party is not led by ‘communists’.

We’re not just some mob to be staved off, we were the bulk of the people of this country, and our interests, on the many different levels they exist, should not be ignored, simply so a few can be free in some theoretical fashion to make as much money as they can rake in with their own two hands.

It sounds like you are starting to lapse into rhetoric here, saying ‘the bulk’ of the people is presumptuous don’t you think, when at best you speak to about half (or less) of the people in the country?

As far as the Constitution goes? It was preceded by a government that was much weaker, much more reliant on the the states and small parts of the government.

Yes, you are correct.

It did much of what modern Libertarians would want it to do. But it was such a disaster that the system in question got chucked.

No, you are incorrect. Libertarians are looking towards the constitution, not the Articles of Confederation. You keep trying that old tactic but that dog doesn’t hunt… At no time do Libertarians think there should be ‘no’ central government or the government of the Articles. Straw Men arguments don’t help.

A government needs to have the strength to do what it needs to do, and the constraints to make sure that this increased strength is not employed in the wrong places. That’s my basic opinion: strong government, but strongly defined in its powers so that its power is not abused, and are not used beyond where they are justified.

No, the government was designed to be strong in a few basic areas that needed to be (specifically dealing with foreign countries and regulating how the states dealt with each other) and beyond that it was to stay hands off.

You can see evidence of that in the 9th and 10th amendments, the words of the Framers and the writers of the Constitution. It was not meant to put in place a totalitarian central government that had domain over everything that anyone did in the country, otherwise why leave the Crown? We already had that.

I don’t believe a government can or should solve all problems. People have to solve some of their own.

I am curious to hear a few examples of this…

I can’t claim to be able to work out all the details on that, on where freedoms should end and laws begin, or vice versa, but the basics, I would say, start with our civil liberties. That’s where I stand strongly for keeping government out of our lives. We don’t need every decision made for us.

Luckily we don’t have to, it was done for us when the Constitution was adopted AND when it has been changed to allow for how the country has changed.

Simply ignoring its clear, proscribed limitations invalidates the purpose and strength of it entirely.

However, we do need the ability as citizens to demand and get laws that prevent destructive market practices. A free market isn’t free because it’s lawless, it’s free because the bulk of the work of figuring out prices is left up to the market. However, if the market is badly distorted by the behavior of private actors, as it was in the case of the 2008 crash, and the recession it accompanied, then our market economy won’t work so well to our advantage.

And I’ve made that pretty clear that I agree with you. But that is not the same thing as picking winners and losers. Keeping a free market that is fair and does not pick winners and losers is the ONLY way that this can happen.

I think we need to define out of legitimacy that behavior which leads to such distortion. We need to take the house of games mentality out of Wall Street. Their job is supposed to be making it easier for America to function economically, but because of their mistakes, they’re actually doing the opposite. Neither the financial sector, nor any other sector, should be allowed to serve as a millstone around our economy and our societies neck.

Agreed, but the way to do this is to get government out of the business of trying to define an outcome.

We want people to own homes because it is ‘good for the country’ so we put policies in place to make home buying more attractive. We take money from people to help others pay for their homes through tax exemptions, hoping to drive to a predicted outcome. Only we create bubbles while doing so, we elevate home prices by doing so and we put ourselves in the very situation where eventually that bubble has to burst. It is not sustainable. We are altering the market to meet an idea that we want it to be, not what it is.

Overregulation, or rather, WRONG regulation, was the cause of the problems we have now, along with politics being played because of the election of the president that was going on at the time. Bush wanting to ARTIFICIALLY increase the economy after 9/11 and then to get re-elected along with politics trying to push the market in ways it wasn’t meant to go in order to get congressmen elected created an unsustainable bubble. It was going to fail, the question was just when and how bad. When the congress decided to ignore the calls to temporarily end mark-to-market accounting (put in place after Enron) that wiped off 500 *BILLIONS* of dollars off of the books of banks so they couldn’t loan anymore, it was a perfect storm.

Doing the same things that failed over the last 10 years to try to solve it is more folly…

Posted by: Rhinehold at October 10, 2011 9:09 AM
Comment #330277

Rhinehold-
The right wing and the libertarians all too often point to mistakes on government’s part, or imperfections on their part to justify taking government out of the equation. They imply that people by themselves will handle it better. Unfortunately, they simply assume this, all too often, even when the evidence says that it was a mistake to simply leave it up to chance and individual judgment.

Some people make the judgments they do not because they are wise enough to foresee the best ends, but because they are counting on being lucky enough not to pay the price, that the indefinite future of that reckoning will not be made manifest.

Or maybe the product or the shape of the market itself pose the problem. Many people invested in mortgage securities, assured by the ratings agencies and the people selling the bonds that they were a sound investment, despite the fact that a good faith assessment of those products would indicate they weren’t.

Choices were skewed not by mere negligent ignorance, but ignorance born of the deception of client by broker. The banks and the financial institutions didn’t pay much mind to the long term problems of essentially running a bad mortgage fraud scheme. They were sure, and not without reason, that they wouldn’t be the ones punished.

Or, in the case of smoking, you have a choice involving a substance which itself skews judgment. Addiction is not a matter of moral failure, but a real change in the physiology of the neurons. A person is literally fighting their own primal reward system in order to battle the addiction. For years, people argued as you have, that it’s fundamentally a choice, but in reality, it’s not as much of a choice as it should be once people end up addicted to that tobacco product. It’s something they have to do to feel normal, to behave like a normal human being.

For decades, cigarette manufacturers fought the basic fact that cigarettes were addictive, and deliberately marketed cigarettes to the young to ensure a long term market of addicts. If this seems to you to be a responsible sort of social behavior, then by all means, explain to me your understanding of what makes this a moral business.

And what about “chicken little” philosophies? Isn’t it more chicken little to warn of vast socialist conspiracies of which there is no reliable evidence, than to warn of climate change of which there is overwhelming evidence?

It is the fact that I have a skeptical nature and there is just too much here that doesn’t ring true to me.

If you are to be skeptical, you must be skeptical enough to question your own assumptions. For example, is their enough increase or decrease in other forcings to explain global warming? Even if a theory or model is not perfect, it is to be preferred on a tentative basis to one which has absolutely no explanatory power, which falls short on basic physics.

And your assumption is that that is a bad thing. There is too much here that we are GUESSING about.

Well, let me tell you what my assumptions are. My first assumption is that science is basically built on educated guesses that are confirmed by observation or experimental evidence. There’s been a lot to confirm global warming, so we’re not talking guesswork alone.

But more to the point, you are guessing here, even if you won’t admit it. You’re guessing that it’s going to be a net positive for us.

What are your assumptions based on? We’re not Europe, and the temperature increase won’t necessarily behave like it did with the Medieval Warm Period. Climate scientists pretty much say that one was local.

A true skeptic in these situations would say that they don’t know for sure what will happen, who the winners and losers might be.

The real threat from global warming is the change from 8000 years of Holocene stability. We’re changing the weather on a fundamental level, in an unpredictable fashion. We have no idea what the new normal will be, and that will work against us as we try to adapt.

Me, I think that’s an awfully wasteful way to go about things.

One thing the scientists agree on is that the longer we burn fossil fuels to create energy, the more unavoidable change is, and the more severe it will be. Me, I like the world like it is, I’m in no rush to remake it. I don’t want us to have to go through all the expense of running around, trying to figure out what lands will be best for growing food. I want us to be able to keep the bread baskets we got, and not ruin ourselves on a gamble like you’re describing. We should not be playing russian roulette with our civilization.

Don’t you usually eschew these same concerns when the notion of ‘debt’ is brought up? That is a known quantity, not a guess…

Try again. Those debt forecasts are not known quantities, they are projections based on assumptions that policies will not change, and on current growth projections.

If you want to know what bugs me about your arguments sometimes, it’s that you fail to see the uncertain nature of your own projections, of your own assumptions.

If we, for example, stimulate the economy now, that might mean more people employed over time, which means more revenue. If we charge higher taxes for those at the top, that might close the gap, too. The projections would then be obsolete.

Long story short, I think you are certain about things that you would be uncertain about if you were truly examining your claims, and you are spreading doubts about things that are not truly born out by the evidence.

Posted by: Stephen Daugherty at October 10, 2011 12:33 PM
Comment #330278

Rhinehold-
Another thing: Mark to Market accounting wasn’t put in place AFTER Enron, it was one of the fundamental parts of the Enron scandal, and predated it by quite some time.

Posted by: Stephen Daugherty at October 10, 2011 12:47 PM
Comment #330281

Rhinehold-

We want people to own homes because it is ‘good for the country’ so we put policies in place to make home buying more attractive. We take money from people to help others pay for their homes through tax exemptions, hoping to drive to a predicted outcome. Only we create bubbles while doing so, we elevate home prices by doing so and we put ourselves in the very situation where eventually that bubble has to burst. It is not sustainable. We are altering the market to meet an idea that we want it to be, not what it is.

There were other elements to it.

Let’s review what might have been the potential market brakes on this, before we move forward.

Okay, let’s say people are encouraged to buy homes. But wait! They have to be able to pay for it, and in most cases, that means a mortgage. The mortgage company has to originate a mortgage first. If they choose not to, then the house cannot be bought at that value by that customer.

Okay, let’s say that the company gives people the mortgages. If they are good paying customers, if the Mortgage companies figured it out right, then the mortgage company will see the loans paid back consistently. If customers do not pay those companies back consistently, the company can’t post a return on investment.

Ah, but what if we’re eager to make more money? Well, if you’re reasonably sure that somebody will pay back a mortgage, you can sell that mortgage for its eventual value. Theoretically, the limit on that will be that if a company sells bad mortgages instead, people will quit buying their mortgage securities, or demand a higher rate of return on the bonds. This will put them out of the market for the most common investors.

The system can work, and did work for decades.

What went wrong? Let’s start from the consumer and move up:

Reckless decisions by lenders meant that people who couldn’t afford houses were being lent the money to buy them. Unsustainable, of course, but in the mean time, home values increase, so when companies have people refinance or get new home loans, they end up with a thing of increased value to sell, and so do homeowners.

That is, until that market crashed. In the meantime, it didn’t.

Lenders were also encouraged to originate bad loans because they knew they could get sold. In fact, the larger and the worse the loan, the better. They counted on the increase of the theoretical cost of the loan, including penalty fees and late charges, and manipulated homeowners into positions where they literally could not keep things up and keep things clean, so the eventual value of the loan would increase.

Of course, this would eventually cause a wave of foreclosures that would collapse the value of the market, and kill home sales for quite some time to come, but in the meantime, there were enough people left to con.

High risk loans should have been put in their very own tranche to be sold off, given to investors, fewer in number, who were more keen on the risk. Ah, but that wouldn’t have kept the game up long enough, so they slapped some derivatives hedging on those mortgages, and then intermixed them with the other, better mortgages, making the securities more broadly sellable. Unfortunately, they didn’t leave behind any documentation as to what mortgages composed what parts of these assets. By making them more broadly sellable, they made it, at least for the time being, profitable to run an industry on predatory lending.

To make it even worse, investment banks knowingly piled one layer of derivatives on top of another, so when the derivatives with stuff from the subprime market became uncertain in value, so did the value of trillions of dollars worth of bank assets, in the form of those compounded derivatives.

Long story short, a lack of regulation, oversight, and transparency at those critical levels helped create a situation where not only did market forces not work to correct problems, they actively worked to make those problems worse. The Republicans want to blame it on minorities, or the CRA, or on Fannie and Freddie being poorly run, but if it were just them, this would have been one rinky-dink crisis, and Wall Street would have hardly batted an eye.

We let Wall Street police itself, and this is the system they came up with.

All games have rules, rules set in place for one reason: to filter out as many of those people who win by unfair or unacceptable means as possible. In the case of the Deepwater Horizon, BP and the other companies failed to make the proper preparations to safely detach the drilling rig, and put in place their production rig. There are any number of things they did wrong that lead to problems they could have prevented.

Many of these things, they overlooked because it saved them money to overlook them.

The market is a game, and if there isn’t a rule in a game that filters out a bad way of winning it, you’ll see people take up those cheating tactics, knowing they can get away with it.

Libertarian free market policies often deny that this might be the outcome. They assume the market will make corrections. In my experience, though, deception and chicanery often mean that the correction is excessive, often strong enough to push the economy into another mode of functioning. Enron was just one company that was being deceptive on its books. It was the fact that there were so many bad loans and bad debt issues out there that made it a truly widespread problem.

My philosophy is, there will always be catastrophic failures of one kind or another. I believe the frequency of certain severe kinds will be influenced by the weaknesses present in the market. If we allow too much weakness to develop in too many places, then those will be the places along which our market will break. The inevitable disasters need to be better contained, better minimized, in my view.

Posted by: Stephen Daugherty at October 10, 2011 1:43 PM
Comment #330282
The right wing and the libertarians all too often point to mistakes on government’s part, or imperfections on their part to justify taking government out of the equation. They imply that people by themselves will handle it better. Unfortunately, they simply assume this, all too often, even when the evidence says that it was a mistake to simply leave it up to chance and individual judgment.

No, not NECESSARILY better, but it would be a decision based on their needs and goals, not a political solution that doesn’t take the individual’s experience into account. That individual may make the wrong choice for them, but that’s part of life, at least they made their own wrong decision and is not forced to rely on someone else’s.

If you are to be skeptical, you must be skeptical enough to question your own assumptions.

Which is the case, I routinely question myself and my views, read things I would normally not read and look up facts before posting them by looking at ‘the other side’ to see what their arguments are. They may be right (and there have been times that I have been wrong and I’ve changed my views).

For example, is their enough increase or decrease in other forcings to explain global warming? Even if a theory or model is not perfect, it is to be preferred on a tentative basis to one which has absolutely no explanatory power, which falls short on basic physics.

And is there enough explanation, if C02 is increasing yet we so no temp increases, does C02 play as important of a role as previously thought 10 years ago?

Yes, there is a lot to consider in this area.

You’re guessing that it’s going to be a net positive for us.

No, at no time did I say it would. We don’t know. I am making no guesses other than seeing too many inconsistencies that just don’t fit the narrative.

A true skeptic in these situations would say that they don’t know for sure what will happen, who the winners and losers might be.

Which is exactly what I’ve said. I ask opened ended questions because NO ONE has the answers.

Those debt forecasts are not known quantities

I never mentioned forecasts, I mean the debt we have TODAY. If tomorrow a budget was actually passed (unlikely) and it only spent what we brought in (again, unlikely), essentially balancing the budget, we would still have over 14 Trillion dollars to pay back (specifically 14,836,776,365,856.51). No one has a plan on how to balance the budget, let alone pay that back, are you expecting them to just ‘disappear’?

Another thing: Mark to Market accounting wasn’t put in place AFTER Enron, it was one of the fundamental parts of the Enron scandal, and predated it by quite some time.

I wasn’t specific because I figured many wouldn’t know what I’m talking about. FAS 157 sound better to you or can we agree to just say Mark to Market so that others who don’t know the specific difference between FAS 115 and 157 can follow along?

BTW, it’s a perfect example of how bad regulation was ‘fixed’ by more bad regulation resulting in worse problems…

William Isaac was clear that if we had to report those assets during the S&L crisis, we wouldn’t have to worry about mortgage derivatives because US wouldn’t have existed long enough to worry about them…

Posted by: Rhinehold at October 10, 2011 2:03 PM
Comment #330284
Libertarian free market policies often deny that this might be the outcome.

And no matter how many times I tell you this isn’t true, you still keep repeating it.

Libertarian free market policies are regulations that are there to prevent fraud and deal with people like BP who act irresponsibly. This is how the market ‘stays fee’. You want to keep arguing Straw Men of your own devising when I’ve clearly stated that you are misstating Libertarian thought over and over again.

What we don’t want is government trying to determine the outcome, trying to alter the market to make it be what they want it to be based on some political view, whether it be the Democrats or the Republicans in charge at the time. What it seems to me is that both parties want to be able to alter the market to fit their political desires while preventing the other party from being able to alter it to fit theirs…

That’s how we get into the troubles we have now. If government didn’t have these powers to begin with, why would ‘corporate america’ try to influence the environment? There would be no gain any more.

Posted by: Rhinehold at October 10, 2011 2:29 PM
Comment #330290

SD writes; “The trouble for your average Republican is that for all they make the case that it’s regulation getting in the way of new jobs, the vast, and I mean vast majority of job losses are from the simple fact that there isn’t enough demand out there.”

If SD should practice what he preaches, it would become obvious to him that there was and is demand or else jobs would not be created elsewhere to create the goods and services being sold here.

If this were not true, why would jobs leave our shores rather than simply disappearing all together?

I often read on these pages from those who hate and disparage Walmart and other huge retailers who sell mostly foreign made goods. Someone created those goods and someone, in the US, purchases them. Is that not DEMAND?

If we lacked demand for goods and services why would we be running trade deficits? But that is not the case…is it?

Instead of addressing the real causes of job losses, some prefer to simply blame corporate America. It’s greed, monopolistic tendencies, hunger for power, or whatever that they say is the problem.

These folks are anti-capitalists. They see profit from investment of capital as the reason for our job losses. Do China, India and other countries around the world who produce and sell much to the US not concern themselves with profit? Are they simply practicing philanthropy? Not likely!

We must compete for jobs in this world. The truth is, we have not been doing a very good job at competing lately. We allow other countries to steal our best ideas despite patents and other protective devices. We engage in unfavorable trade deals that place us at a disadvantage. We allow countries to manipulate their currencies to their advantage and our disadvantage. We subsidize higher education for those who lack desire or intellect to warrant such an expense. We place roadblocks (unnecessary regulation) in the way of our businesses to compete and excel in the market place. Many of these regulations merely exist to provide a job for a government bureaucrat or satisfy a political interest group.

Unions hamper productivity in many of our industries. Unions do not encourage maximum output by each worker. Instead, they foster the idea of doing the minimum since seniority, not productivity, determines their wages.

If we want good jobs to return to these shores we must compete with the world for them. And, we have many advantages that others do not possess.

We already are a nation of property laws (and others) which fosters innovation and industry. We have plentiful natural resources, energy, minerals, land, and a highly educated populace. We have infrastructure in the form of highways, rail, waterways, communications and more that is the envy of much of the world.

We provide subsidizes to placate some at the disadvantage of others and call it enlightened. Our tax code is thousands of pages in length and full of loopholes for those who can afford the accountants to find them and lawyers to defend them. There is one reason, and one reason only that our individual and corporate tax code is so complicated. It is this way to allow politicians to favor some at the expense of others. It impedes our trade negotiations, the building of new plants, the development of new, and refurbishing of older, factories. It stifles innovation and industry. It penalizes risk-taking and discourages entrepreneurs.

And yet, some would have us compete in the world market for jobs with one or both hands tied behind our backs. And then, these same folks wonder why we are losing jobs. I call it a mental disorder.

We find much of this same disorder in the way our country wages war. We do it in a half-hearted and nonsensical way and expect superb results. Mental disorder or insanity…whichever, same lacklustre results.

Posted by: Royal Flush at October 10, 2011 6:10 PM
Comment #330291

SD wrote; “A government needs to have the strength to do what it needs to do, and the constraints to make sure that this increased strength is not employed in the wrong places. That’s my basic opinion: strong government, but strongly defined in its powers so that its power is not abused, and are not used beyond where they are justified.”

What a nonsense comment. A government that has the strength you speak of will have no constraints. A strong government with defined powers is along the lines of our founders thoughts. We don’t have that today and that is one of the primary problems…A strong government whose power has become undefined.

I would ask SD just who it is he believes is there to exercise the strength to prevent the power from becoming wrongly employed?

Certainly it is not the people. They can only exercise power through our political parties which are mostly corrupt. Certainly it is not the administration which is filled with bureaucrats interested in preserving their own power.

Posted by: Royal Flush at October 10, 2011 6:53 PM
Comment #330295

SD writes: “That’s my basic opinion: strong government, but strongly defined in its powers so that its power is not abused,..”

Royal Flush writes: “A strong government with defined powers is along the lines of our founders thoughts.”

Royal Flush,

You say SD’s comments are “nonsense.” But, where is the disagreement?

Posted by: Rich at October 10, 2011 7:36 PM
Comment #330298

Rich…it was well explained.

Posted by: Royal Flush at October 10, 2011 7:57 PM
Comment #330303

Rhinehold-
First, how individual are our experiences? When you have companies whose policies affect millions of individuals apiece (like AT&T, Boeing, or BP, to name a few) there’s a limit on how unique people’s experience must be.

You’re confusing chaotic behavior with random. Behavior out there is not random. The price of gas does not have a random effect. Nor does a ton of oil coating your coastline. Individual experiences may vary, but the variation can be fairly consistent under many circumstances.

I mean, look at the housing crisis. This was industry standard practice, to overlook the riskiness of the loans. They got enough people on the hook for this to cause a major wave of foreclosures, which in turn was enough to drop home prices. It didn’t have to be everybody, it just had to be enough people to break a weakened system.

This also where the failure to keep banks, hedge funds, insurance companies and brokerages apart reaps its bitter fruit. They were too big to fail because we changed the laws to allow them to be. You could let their failures be individual experiences a lot easier, if there were more competitors, and not everybody was in the same kind of trouble. That’s the point of diversified competition. It makes the different companies more disposable, with less threat to our nation’s economy.

As for being skeptical?

Look, it’s not just about looking at the other side. Truth is, there aren’t sides to the argument, there’s the truth and then there’s our approximations.

As for increases in CO2 without temperature increases?

You should have picked a harder challenge. First, there have been some temperature increases. In particular, Texas recorded the highest average temperatures that AMERICA (not just Texas) has ever seen. I should know, I suffered through that summer personally. A number of other places around the world have experienced record temperatures as well, and enormous amounts of rainfall. The last decade contain many of the warmest years on record. They just didn’t happen to be warmer than 1998.

The trick, really, is that while you’re willing to play rhetorical tricks with the existence of natural variability, you’re not grasping that it continues to act even in the face of human-caused variations.

You talk of inconsistencies, I think, where you should be speaking of your unfamiliarity with the science. Climate change is not about a graph that doesn’t stop going up, it’s about an average that keeps on going up.

No, at no time did I say it would. We don’t know. I am making no guesses other than seeing too many inconsistencies that just don’t fit the narrative.

Look, you point out, in your narrative, that the medieval warm period was good for the Europeans. But that warm period was the product of a very small local difference in average temperatures. What happens when you introduce a very large difference, comparatively, in global average temperatures?

If we have no idea about what exactly might happen, we do have a good idea of how much small changes in temperature can do to a climate system. And we are introducing one hell of a change to that system.

What we can say is that those climate differences will be significant, and what’s more, not simple in the least. Climate change in Earth’s past has meant extreme shifts in conditions. A moderate cooling turned the Sahara from Grasslands to the world’s greatest desert. A difference in temperature in the Atlantic could dry up the rain forests. Drought and dryness might become a permanent feature of my area, where once it was just an occasional problem.

It’s not just a matter of what the thermometer says. It’s a matter of where the wind blows, where the air masses take the moisture, the storms, and whatever else. It’s how much moisture the air can hold before it has to rain it out. It’s a combination of all kinds of different things.

The rains fall upon the great plains, and the dry air comes to California for particular reasons. The currents flow where they do for particular reasons, following the winds.

And you’re saying it’s nothing to mess with these things.

As for the budget? We can pay back that debt, you know. We’re not in a position where servicing that debt is crippling to our economy. The real trouble is that some well intentioned folks are going to kill the economy trying to kill the deficit, and that’s going to make the deficit, debt, and servicing problems greater. The real problem for us is the bad economy. Everything else flows from that. You can’t expect our finances to do much better if long term unemployment continues like this.

As for your technical talk about mark to market? Explain the differences, because I don’t see where I should just be fobbed off by some technical number. Tell me why the mark to market of one era is different from another. I’m sure if you understand things better you can explain better.

Royal Flush-
Oh, dear, you’re right. There must be demand. If I had realized that, I would have said there wasn’t enough demand, instead of saying there was no demand…

Wait, I did say that.

The problem is not that we don’t have any demand, the problem is that demand dropped off a cliff, and hasn’t fully recovered, to the point that our productive potential is being realized, the way it was when we had full employment.

I’m not an anti-capitalist. I’m just not an idolator of the system. You preach the free market, but do you really think the countries you mention practice it the way you have us practice it? No. They don’t. Hell, the Chinese are the exact kind of socialist you’re decrying, yet they’re kicking our butts. Why? Because they haven’t thrown the fight on leading the world in industry. Your people have.

I mean, who is it who has insisted on free trade being the answer, more than anybody else? Who has balked at including provisions to trade deals that help keep jobs here at home, and help protect our products abroad?

As for subsidizing education here at home? Many countries do just fine making higher education available to those willing to take it on.

Oh, and what about this:

We place roadblocks (unnecessary regulation) in the way of our businesses to compete and excel in the market place. Many of these regulations merely exist to provide a job for a government bureaucrat or satisfy a political interest group.

That’s some Chutzpah you got there. Did you read my entry? Regulation isn’t the job killer. Low demand is. Unions aren’t the job killers. Folks not being able to afford anything beyond the basics, if that, is the jobs killer.

You can slander all the people you want with that claim of a mental disorder, but that doesn’t change the fact that you’re putting forward creative stories about regulation and government that do little to fulfill the promises you make as to what will happen when we do away with these things.

What a nonsense comment. A government that has the strength you speak of will have no constraints. A strong government with defined powers is along the lines of our founders thoughts.

What a nonsense response. Strength in a government is not a lack of constraints. It’s the ability to do something when it’s got the cause and clearance to do so.

Posted by: Stephen Daugherty at October 10, 2011 9:50 PM
Comment #330421

Is is unfortunate that SD wishes to engage in politics rather than addressing the real solutions of which I wrote.

We say we want jobs and we have a government that responds by borrowing money to create a few, non-permanent jobs with most of the money going into the pockets of those who don’t need jobs.

We say we want jobs but are resistant to creating the conditions that will bring back jobs lost and create new…lasting jobs for many.

We say we want jobs but are stuck with the liberal solution which has not, and will not, work.

We hear obama say, while waving a sheaf of papers representing his ideas, that a mere half trillion dollars will restore jobs for many and yet, congress will not even introduce his failed plan. Why, because it has been tried and found wanting.

We hear writers on WB decry the “too big to fail” banks and others yet rail at the thought of allowing the tried and true method of bankruptcy to operate.

SD and his friends are not so much interested in changing the way things are done to allow the private industry to create jobs as they are in political power. Their power, at present, emanates not from the voting booth, but rather, from the power to spend what we don’t have. Not content to have half the mature population in the US paying no taxes, they wish to increase the numbers relying upon government for their existence.

Employing the remedies I suggest is anathema to them as they see no political advantage in a strong economy with full employment. The liberal philosophy preys upon the weak, the needy, those who want something for nothing. We will be well served when obama and his enablers are evicted from offices of power.

Posted by: Royal Flush at October 11, 2011 2:39 PM
Comment #330422

Royal Flush-
Some of the jobs will be permanent jobs, and other jobs will be temporary, but once you get the ball rolling, the effects of the stimulus feedback into the economy, and the economy itself takes over. See, we have faith that the market can take over, but that sometimes you need a kickstart to get it out of a rut it can’t move from on its own.

Our solution worked. Yours hasn’t. Mainstream opinion says that the stimulus brought back a million and a half to three million jobs, and that it’s multiplier effects helped save this country from a lot of economic grief. Because many of the jobs were never lost, or were added, the economy’s not going to go down that dark road so far, unless something else pushes it.

Republicans have responded with the brilliant plan of using tax cuts that correlate with the lowest job creation rate in decades, budget cuts and layoffs that directly drag on growth and employment numbers, and uncertainty-generating political stunts like that stupid debt-ceiling confrontation your folks forced on everybody else. Nobody else was going to inflict that crap on our economy in these times.

As for why Congress won’t introduce the plan, that’s easy: because the Republican leadership wants a crap economy. A crap economy is their only hope to get people to overlook the flaws of their rather lackluster collection of candidates.

We hear writers on WB decry the “too big to fail” banks and others yet rail at the thought of allowing the tried and true method of bankruptcy to operate.

Tried and true? Two words: Lehman Brothers. Just their failure was enough to cause a panic that sunk us into this economic crisis. You want to repeate “tried and failed” strategies, you go do it in your fantasies, and leave reality to the more responsible.

The truth is, they never should have been allowed to be so big, to concentrate so much economic power in just the hands of a few. They should have never been given an unregulated playing field with OTC derivatives that would allow them to build their assets up based on nothing more than nominal bets and speculative instruments.

Your remedies are worse than the disease, in fact in many cases the cause of the ailment itself.

If you had spent any time reading liberal sites, they are profoundly interested in a functioning economy. It’s the Republican Party, with it’s continued interest in austerity over economic stimulus that is the one trying to trade our nation’s prosperity for their own political and financial enrichment. Your argument is just more sleight of hand to conceal the ugly truth: that Republicans have invested in America’s economic decline.

Why? Because any success they allow Obama in improving the economy will make it that much more easier for him to defeat the Republicans opposing him.

Posted by: Stephen Daugherty at October 11, 2011 3:14 PM
Comment #330423

SD writes; “Why? Because any success they allow Obama in improving the economy will make it that much more easier for him to defeat the Republicans opposing him.”

Hmmm…it is the dems who won’t introduce his jobs bill isn’t it? Why isn’t his own party of the same belief in spending that obama is? Could it be that many of them also face reelection? If so, wouldn’t an improving economy by virtue of a new jobs bill be to their advantage? Of course it would. Since they won’t introduce obama’s bill it can only mean that they don’t believe in it and believe more reckless spending will cost them in their own election efforts.

SD doesn’t believe in corporate bankruptcy for the TBTF bunch. Apparently he believes it is better to reward them for bad behavior. I know…I know…mental disorder.

Posted by: Royal Flush at October 11, 2011 3:27 PM
Comment #330424

Royal Flush-
It’s funny that your basic defense is not to say my ideas are bad, but to reference the fact that some Democrats won’t agree with it. Well, a major pollster, who’s had his differences with Obama in the past has basically come out and said they’re morons.

Why should I join such folks, who don’t have the brains or the guts to support their own party? If they think throwing their fellow Democrats under the bus is a good idea, I’ve got news for them: the Bus is only going to back over them on the way back, with people like you driving it.

These are conservative Democrats, Democrats who have made their careers by sticking their thumbs in the eyes of their more liberal colleagues. Do you seriously expect me to be surprised, much less in agreement with them? They need to get their heads on straight, and learn some party loyalty.

As for corporate bankruptcy?

The mental disorder belongs to those who fail to register that deserving or not, those bastards wield an incredible amount of capital in our economy, and their collapse, which would likely be as one entangled mass, would gut that economy, and send it into a depression.

I think that’s nuts. It sucks that I can’t indulge my magic market fairy fantasies like you can, but I’m not willing to kill this country’s economy, like you are, to test your harebrained theory yet again, that somehow we’ll rise up better than ever out of the ashes.

I’m sympathetic to breaking the banks up. I’m sympathetic to rewriting the laws and reinforcing the SEC to make sure their bull**** mistakes don’t get repeated.

Don’t mistake the unwillingness to court a catastrophic large scale economic collapse with sympathy for their banks.

Posted by: Stephen Daugherty at October 11, 2011 3:57 PM
Comment #330425

Oh yes, I understand SD that rather than let these poorly managed companies fail thru bankruptcy you would rather prop them up with trillions of public debt. All the regulations that you and congress can drum up will not prevent unscrupulous folks from doing bad things.

How many of these corporate assholes still remain in control? Nearly all of them. They suffer not from their terrible management and greed. And yet, you reward them. Un Fuc*ing Believable.

Bankruptcy purges and punishes the crooks, the lousy managers, the careless, and the irresponsible. The problems persist and may, in fact, be growing as the rewards keep coming.

Some believe that government is pure, honest, above board, incapable of collusion. That’s simply bullshit. Government employees are just as human as any other. When one places all their faith and trust in government they will always be disappointed.

The free capitalist market works, and works well, when it is not in bed with government. Liberals wish to marry corporate actions with government regulation. The problem is almost always that these same corporations that are being regulated, dictate the very regulations being formulated.

Bankruptcy and restructuring always beats government pandering and protection.

Posted by: Royal Flush at October 11, 2011 4:18 PM
Comment #330427

Royal Flush-
It’s pretty simple. You’re calculating as if we can let those banks fail for free. Lehman Brothers proved they wouldn’t fail without some cost to our economy.

If Lehman Brothers had not failed, if we had capitalized it, unwound it and the other bad debts instead of letting it implode and take the rest of the economy with it, we probably could have avoided trillions in debt, caused by the crash of our economy.

What, you think you can let the economy fail, and not increase the deficits?

You’re thinking in slogan-sized chunks, not systematically like you should.

As for this whole “in bed with government”? Give me a break (it would be a ****ing break if I’m inclined to curse). The Republicans, far from distance business from government, got them a hotel room and a canful of Spanish Fly. Bankruptcy won’t work for the big banks because they’re involved in so many counterparty obligations that letting one collapse would bring them all down, and with it, our nation’s ability to drive consumer demand of any kind. I mean, what is it, did you just not do a good enough job last time, and you think you have to complete the ****-up? (see there? I censored it just fine.)

You want to posture as if your party would be the better protectors of capitalism, but the truth is, you’ve let it become a degenerate, slack version of what it once was.

Posted by: Stephen Daugherty at October 11, 2011 6:23 PM
Comment #330428

SD writes; “If Lehman Brothers had not failed, if we had capitalized it, unwound it and the other bad debts instead of letting it implode and take the rest of the economy with it, we probably could have avoided trillions in debt, caused by the crash of our economy.”

I just love how casually you write about “us” capitalizing the debts of a private company. Private debt becomes public debt. What a grand idea. How does one “avoid trillions in debt” by transferring private debt to public debt? Someone still pays the piper don’t they?

What you are advocating, and what has and is actually happening, is the transfer of private debt to public debt to be paid at some imaginary date by imaginary taxpayers. Your comments involves denial, delay, and obfuscation.

Bankruptcy burns clean and true. It allows remaining assets to come under new management to be more wisely managed. And, it forces bad management, thieves, and others responsible, to be charged with possible criminal action or civil action, and in most cases, the perps are gone for good. These desired results can not be achieved by bailing out the perps to live and connive and cause more future problems.

Posted by: Royal Flush at October 11, 2011 7:35 PM
Comment #330431

“…it would become obvious to … that there was and is demand or else jobs would not be created elsewhere to create the goods and services being sold here.”

Royal Flush,

You can’t be serious. You seem to thing that there is actually adequate demand. American consumption is just fine. The reported drop in consumption after the 2008 collapse and the low trajectory of increased consumer consumption and spending thereafter is just some statistical artifact. But, if true, then what is the problem? If we can afford to purchase all the goods and services that we desire, who cares where they are produced. But, that isn’t true, is it? This is what conservative Noble prize winning economist and fellow at the Hoover Institute, Michael Spence, had to say recently about domestic demand:

“The financial crisis that began in 2008 caused a sudden stop to the unsustainable pattern on the demand side.”

“The net effect is that domestic demand is dramatically lower, and overall demand (domestic and foreign) is too low. As a result, the U.S. economy has almost stopped growing, particularly as the federal government (together with state and local governments) are now reining in their own budget deficits.” http://search.japantimes.co.jp/cgi-bin/eo20111003a5.html

I would encourage you to read the above article. Mr. Spence presents a strong argument that this downturn is not cyclical, but rather structural. There are no simple fixes. The American economy needs to be re-tooled to compete in the international market. In order to do that, it will be necessary for the government to invest in technology, education, alternative energy, etc.

Posted by: Rich at October 11, 2011 8:14 PM
Comment #330435

Royal Flush-
You seem to love a lot of things: here’s what I love: the ability to think through things properly without bringing blind emotion into it.

The point is only to forestall the failure long enough to make it an orderly failure, with what that company owes, and what is owed that company sorted out. For all your raging doubts, I have the advantage in this argument: we did this once before.

When Long Term Capital Management missed their guess on the value of the ruble, what had been a profitable company seemed on the verge of imploding. With the derivatives market then much as it is now, that could have brought about what Lehman Brothers did bring about a decade earlier.

However, the company was unwound, rather than left to collapse. That meant our markets were left standing, rather than taken down by a widespread collapse. The banks paid for it in this case.

The problem with letting companies get so big, and then letting them fail is that the secondary results of that punish a hell of lot of people and businesses that did nothing wrong, and if the effect is harsh enough, then you get huge amounts of slack in the economy. That’s where our lack of demand comes from- not the failure of the banks, but rather the failure of the credit markets brought on by the panic, which caused about four million people to lose their jobs in a years time, and then four million more people the next year.

You would trigger that same exact event, on a permanent and lasting scale, for America’s own good, it seems. It’s not for nothing that folks say the road to hell is paved with good intentions. Problem is, you don’t seem to want to learn from things that went sideways. You want to insist that the same things you thought were wrong before are wrong now. Does it not concern you that the only causes you seem to come with are vague pronouncements about regulations getting in the way, or government being too big, or taxes too high? Does it not concern you that fixing these problems, the way you have over the last few years, doesn’t seem to have actually fixed the problems themselves?

You can believe what you want, but the world out there is going to put it to the test. So far, your assumptions have not proved correct. Big tax cuts to the “job creators” did not create jobs, did not supercharge the growth we had before. A constant stream of layoffs, turned into a surge of new layoffs has not relieved any pressure on the economy. Government is shrinking all over the place, and austerity has not solved Greece, Ireland, and Great Britain’s problems, only stalled their economies, making things worse.

Your argument is stuck in a kind of denial. You talk about how Republicans would leave the businesses alone, and remove all temptation, but let me be quite blunt: we’re not talking about folks who are powerless here. Nor are we talking about people who don’t get favors from Washington in the other direction. I mean, if you really went down the list of all the things you or your candidates support, would we really find a hands off attitude, or would we, in effect, find folks who, for the price of political support, get a hand from the federal government.

Meanwhile we have real concerns here. We have a country that’s falling behind competitors on the world markets for the new technology that’s going to drive tomorrows energy market. We have a tremendous amount of slack in the economy that’s leaving too much of America’s ability to produce idle. We have infrastructure that ain’t going to last forever, and isn’t up to our needs, and we’ve got deficit and debt problems that are partly due to your ill-advised fiscal policies, but also much the fault of that economy.

The elegant solution to many of those problems is to build new infrastructure, build up our part of the world’s new energy industries, and by doing that, get ourselves out of this self-destructive, potential-wasting rut we’re in.

Your solution? Your solution is to do nothing, or simply serve the interests of the rich few.

I was never one of those people who looked at Wall Street in ideological terms. I see it in practical terms. I see that much of the wealth and wealth creation has become this clubbly little frothing of fake economic activity, derivatives and derivatives based on those derivatives supporting distorted markets, draining good dollars out of the economy to just sit idle among the few who have the pull to concentrate that wealth.

I don’t think that’s sustainable. But I think there are responsible and irresponsible ways to change that, and the idea that if we just let the “too big to fail” banks fail, that it would fix everything is just terminally stupid in my estimation. It’s the economic equivalent of throwing the baby out with the bathwater.

Your policies have left us with a big bloody mess. You gave these people so many of the freedoms they ended up abusing. You gave them the right to form these super-banks, for crying out loud, concentrating our economic fate and our economic strength in the hands of these few institutions. You allowed them the freedom to conglomerate high-risk ventures with their investment bank and depository bank divisions. You even made it illegal to push new regulations of the over the counter derivatives!

And yet it’s not your fault. And yet, you’re fighting us every inch of the way when we try to reform things. And yet, when we try to revive the economy, your people bitterly oppose even ending the debate, meaning that a bill to go out there and actually create the jobs America needs to provide demand gets shafted.

The Republicans in Washington are a bloody obstacle not only to fixing the problem, but also to making sure it never happens again. We do things your way, and the recovery problem stalls. We do things your way, and eventually what killed us in this last recession will threaten the economy again. And if you get your wish there, well, gee golly, there won’t be much left of this economy to speak of.

I’m sick of this country having to defer to these discredited, dysfunctional policy. American wants, needs, and deserves better than what the GOP has to offer.

Posted by: Stephen Daugherty at October 11, 2011 9:45 PM
Comment #330437


“Bankruptcy won’t work for the big banks”

Hey, a new form of economics, globalism.

Bankruptcy won’t work a whole lot better when we consolidate the big banks, but I guess we will continue the pretence of competition a while longer.

Posted by: jlw at October 11, 2011 11:11 PM
Comment #330438


Seeing as how there was no way in hell for the conservatives to have pulled this off acting alone, it is painfully apparent that America deserves better than what either party has been offering. Of course one must make the distinction between America and the voters who call themselves Americans.

Perhaps the only way to get voters to act responsibly is for the worse case scenario to happen. If not, these politicians can continue to take the money and play the party blame game FOREVER.

Posted by: jlw at October 11, 2011 11:39 PM
Comment #330439

jlw, Well Said!!!!!!!!!!!!!!

Posted by: KAP at October 11, 2011 11:43 PM
Comment #330440

jlw-
Well, we can go back and forth about it all day, what party is truly worth, and I doubt we’re going to find one.

If what we’re looking for, that is, is a party to save us.

What we really should be thinking about is saving ourselves. See, the trouble is, we’ve been deferring our interest to those of the rich, and penalizing those who take in the other direction, who do things like support Unions, or oppose corporate takeovers of things. Whether you didn’t vote all those years, or punished those who took a more “liberal” position, you gave those people aid and comfort.

It’s a little late now to go looking for the political party that’s purely in the corner of the little man. The little man was manipulated into destroying their own political strength.

Getting that back won’t be easy. Getting that back means applying selective pressures constructively towards something better. That takes time, that means dealing with confusing situations and confounded policies.

I don’t go for the Democrats because they’re perfect. I go for them because they are the closest thing to what I would really like that I can find, and that I can see winning the struggle to claim power. I’ll take increments when I can get them, and leaps and bounds when they are available.

In politics, you are either encouraging one thing, or discouraging another. There are no null choices.

Posted by: Stephen Daugherty at October 12, 2011 12:47 AM
Comment #330441

jlw-
And on the bankruptcy front?

I see letting them drop as a fantasy option, as something we’ve already tried and failed at. We would love to believe that bailing out the big banks was wholly unnecessary, but it wasn’t. We needed to keep them alive.

We still do, to a certain extent. However, what we should be working towards, instead, in my opinion, is a way to surgically disconnect the veins, arteries, and nerves of toxic assets and troublesome derivatives contracts, so we can extract that business from the face of the earth without having everything fall to crap.

One way I might put it is “a more responsible version of bankruptcy,”

Our goal should be to make “Too Big to Fail” a thing of the past. We can’t change the fact that the banks are big right now, so the question is, how do we take them apart, and how do we deal with the parts?

Posted by: Stephen Daugherty at October 12, 2011 12:53 AM
Comment #330449

In politics, you are either encouraging one thing, or discouraging another. There are no null choices.

Posted by: Stephen Daugherty at October 12, 2011

OH, Really…no null choices. And yet, that is exactly what you support. You denounce bankruptcy for mismanaged corporations because they are large and yet…seek solutions for this very same malady by infusing tax dollars to keep them afloat. Which is it to be?

SD writes; “One way I might put it is “a more responsible version of bankruptcy,”

Same old liberal crap. Bankruptcy, as now practiced, already can include reorganization, being taken apart and resembled…which you claim to support. What you apparently don’t like in our current bankruptcy laws is the absence of huge government involvement and management.

Many corporations go bankrupt every year. Some are in such bad shape that nothing new emerges. However, many, with some real assets, do emerge strengthened, leaner, and much more competitive.

Too big to fail is a meaningless label. SD seems to stick that label on those companies that are complex, with interwoven financial ties. It makes not the slightest difference. Bankruptcy burns true and clean. It concerns itself with assets and debts. It makes no difference whether government sponsors the debt, or new ownership sheds the debt thru bankruptcy. In the first case, the debt is given to all the taxpayers to repay. In the second case, the debt is given to those who invested in the company in the form of a loss.

In the first case, the taxpayer did not invest voluntarily and does not stand to gain. In the second case, the investor risked his/her capital and stood to gain or lose.

Any loss thru bankruptcy should be borne by the investor, not the taxpayer.

Banks and other financial entities have fiduciary responsibilities. If I have $100,000 on deposit with Bank of America in CD’s, a savings account, and such, should the bank fail and file for bankruptcy does it mean that my money has disappeared? Was that money kept in a vault? Of course not, it was invested in something, some real assets. We are not talking about fraud here, but rather…poor management.

FDIC insures deposits up to a couple hundred thousands. Should BOA file for bankruptcy much of my $100K will be recoverable. What is not is insured. Accounts in amounts above the FDIC limits will still not be a total loss. Does the bank not have that money invested in something? The biggest losers, if losers there must be, will also be those with the largest deposits. Those damn wealthy persons that liberals seem to despise. Why are liberals so adamant about bailing them out while at the same time attempting to take significant more money from them through taxation?

We have the tools we need to deal with so-called TBTF companies. It is called bankruptcy. We should have used it in the past and now.

Posted by: Royal Flush at October 12, 2011 3:05 PM
Comment #330450


Stephen, fantasy option? No, it was the reality option, the road to hardship option, the road to reform option.

We should make to big to fail a thing of the past? Please explain how reelecting Obama will accomplish that. Please explain how reelecting these Democratic politicians or Republican politicians will help accomplish that goal.

I agree that because of the circumstances we had no choice but to bail the status quo. I disagree that it was in our own best interests to do so.

The greatest problem facing us is our mass consumption of consumer goods, most often purchased with debt, and yet our great hope for the economy is getting that mass consumption up and running at peak performance asap. I would call that the fantasy if it wasn’t so reality.

Posted by: jlw at October 12, 2011 3:28 PM
Comment #330451

The greatest problem facing us is our mass consumption of consumer goods, most often purchased with debt, and yet our great hope for the economy is getting that mass consumption up and running at peak performance asap. I would call that the fantasy if it wasn’t so reality.

Posted by: jlw at October 12, 2011

That’s very true jlw. What SD and obama wish to do is spur consumption with borrowed dollars which will, some day, by someone, have to be paid back.

SD believes we have a lack of demand. And, the lack of demand is due to lack of jobs and lack of consumer spending. His answer is to artifically create demand.

The correct way to increase demand is to create conditions in the private market that creates more money. The private market can be stimulated without massive government deficit borrowing as I have outlined in many of my posts.

It makes little sense to put money in my left pocket only to be removed again from my right pocket.

Posted by: Royal Flush at October 12, 2011 4:35 PM
Comment #330457

Royal Flush-
The banks, love them or hate them, perform a necessary function keeping our economy going. If you want to play games with the logic and rhetoric, be my guest, but I’m starting this off from the viewpoint that maintaining the integrity of our economy is first priority.

It’s like we’re faced with a metaphorical bomb here. You want to let it blow up, reasoning that everybody’s going to learn a valuable lesson from it blowing up. That it might cripple our economy for decades to come is beside the point to you.

I want to defuse it. I would rather change the laws to discourage such behavior and prevent a reoccurence of such consolidation. I would rather wind down these banks when they fail, rather than just let them drop, or keep them on life-support indefinitely.

You are willing to allow something truly horrible to happen to this country to make a political point, or to vindicate your theories. Me? I would rather disaster be prevented. I would rather act to keep this country’s economy working, rather than carry out a lesson about moral hazards at the nation’s expense.

Sometimes, failing to deal with something the right way is more costly than biting the bullet and going through the pain necessary to do it right.

If we help the economy recover, then we pay for the thin years out of the fat ones. If we continue to put our fiscal house in order on the back of an economy in shambles, we will be paying for doing that in the thin years with many more years of economic decay.

Which, of course, will cost us fiscally. You cannot both force the economy to adjust to it’s new normal, and bring us back to prosperity. If you reinforce what are making these times hard times, you won’t save money, you just won’t make that much money in this country for years to come.

Posted by: Stephen Daugherty at October 12, 2011 6:40 PM
Comment #330462

SD writes; “That it might cripple our economy for decades to come is beside the point to you.”

It is interesting that you use the word “might” since you seem absolutely convinced that allowing the TBTF corporations to file bankruptcy is tantamount to financial disaster.

These TBTF corporations retain the same assets both before and after being bailed out. It does not change their balance sheet. Unless of course you consider bailouts as gifts rather than loans to be repaid.

The same thing happens with bankruptcy. Assets are still assets and a court will order repayment of debt in a certain order to certain creditors, bondholders or stockholders.

Many times assets in bankruptcy are purchased by new owners with a restructuring plan approved by a court. SD apparently views bankruptcy as the magical disappearance of all assets. It doesn’t work that way.

I suggest SD does a little more study and then come back and discuss it intelligently.

Posted by: Royal Flush at October 12, 2011 7:19 PM
Comment #330466

“The correct way to increase demand is to create conditions in the private market that creates more money. The private market can be stimulated without massive government deficit borrowing as I have outlined in many of my posts.”

Royal Flush,

Yes, it is called monetary policy. But, what do you think that the Fed has been doing? Sitting on their hands? Money is created in our system by debt! The Fed has increased bank reserves by every trick imaginable to spur lending, including giving them almost a trillion dollars in their cash reserve accounts for mortgage backed securities, buying their treasury bonds (QE2), lowering interest rates to virtually zero, etc.

Bank reserves are busting. But, no significant increase in lending. No new bank credit creation of money. Why would that be? Did it ever strike you that the consumer is impaired? That banks aren’t lending because of that fact? That banks are also concerned about their balance sheets chuck full of risky assets? That the consumer is reeling from debt and loss of equity, principally in housing? That the consumer is trying to save and deleverage in a period of too much debt, threat of unemployment and decades of wage stagnation? That businesses are not borrowing despite the cheap money because of lack of demand?

You keep asserting that aggregate demand is high but provide no evidence of that fact. Despite the fact that the Fed and every private sector analyst recognizes that aggregate demand is not sufficient to consume potential output, you claim the contrary. What is your data?

Posted by: Rich at October 12, 2011 8:23 PM
Comment #330469

Royal Flush-
Trying to elbow me out of the debate, eh?

I can discuss this intelligently right now. While I do so, I should mention that many banks nowadays do their accounting in such a way that they count money owed to them as being basically as good as money in the bank.

What happens when the people who owe you money, though, declare bankruptcy? Well then, it’s not as good as money in the bank, now is it? Suddenly a whole bunch of derivatives and a whole bunch of debts owed aren’t worth what they used to, or worse, can’t even properly be valued.

Brilliance! See, it doesn’t so much matter if, say, a business goes under, and it’s just a few investors out. But if some of the biggest banks go out of business, well then you have to deal not only with the fact that the other banks aren’t going to get paid like they thought they were, making them more unstable, but you also have to deal with the consequences of the fact that they’re not issuing the credit and spreading around the capital that they were.

And, having destabilized the rest of the financial sector, it’s wash, rinse, repeat.

Oh, by the way, you said something about the courts ordering the payback of the creditors. Well, that’s all fine and good, so long as there are enough assets and equity to liquidate to pay everbody back. Has it occurred to you that there may not be enough real assets to pay everybody off, especially since since that’s the main reason these banks are in danger of failing?

A judge can order somebody in bankruptcy to pay something back, but it doesn’t mean they actually will. Bankruptcy doesn’t magically create doubts about the ability of a business to pay back it’s debts, it’s by definition the admission of a person or a buainess that they are unable to pay back their creditors.

If you want to discuss things intelligently, dispense with the BS, and acknowledge things for what they are. Bankruptcy means that any promises to pay back debts just got that much more uncertain.

Posted by: Stephen Daugherty at October 12, 2011 9:10 PM
Comment #330490


Royal, both the Democrats and the Republicans are promoting plans that have the intent of maintaining the corporate/government or just the corporate status quo. The Democrats want to do that by raising taxes marginally on the wealthy and stimulating the economy. The Republicans want to do it by eliminating taxes on the wealthy, gutting the government, and squeezing the lower middle class and the poor.

I am not the least bit interested in maintaining the corporate/government or the corporate status quo.

It is not just Stephen, Obama, the Republicans, and the corporations, that want to get that mass consumption back up and running smoothly, it is the vast majority of the people that want that.

If the people show there disinterest for some of the reforms put forth by the Wall Street protesters, and do not make a demand to enact them, then it becomes painfully obvious that pain is the only solution. To allow our economy to collapse would have created great pain on millions more Americans than those feeling the pain now. The fact that there will be a considerable number of people that can ride out the depression won’t save them from the reforms that will be demanded by those that aren’t. Collapsing the economy has a far better chance of producing the exact opposite of what conservatives would want it to produce. Something that a majority of Americans would dislike as much or more than they dislike the corpocracy.

Gutting the governments ability to regulate business and eliminate social programs will create a great demand for government regulation and social programs. That is why we have these things now, because of the demand. Most Americans have no idea of what it was like for many Americans back in the good old days. If they did, they would know why the people made a demand for progressive change.

I find it extremely hard to believe that many supposed conservatives are supporting the most liberal form of capitalism.

Posted by: jlw at October 13, 2011 1:02 PM
Comment #330500

Why don’t some of the users here just take their opinions to UnitedIssues Debate to argue their points?

Posted by: Justin Jones at October 13, 2011 4:22 PM
Comment #330502

Rich writes; “You keep asserting that aggregate demand is high but provide no evidence of that fact.”

No, that is not what I have asserted. I wrote that what demand we have is partially being provided from other countries. There are ways to bring that production back to the US. And, you misunderstand my writing about stimulating the private economy. We need to address corporate taxes, regulations, and more utilization of our natural resources.

Posted by: Royal Flush at October 13, 2011 4:40 PM
Comment #330504

SD writes…”Oh, by the way, you said something about the courts ordering the payback of the creditors. Well, that’s all fine and good, so long as there are enough assets and equity to liquidate to pay everbody back.”

Obviously you didn’t read what I wrote, but rather…what you imagined I wrote. Here is my quote…”Assets are still assets and a court will order repayment of debt in a certain order to certain creditors, bondholders or stockholders.”

Sorry jlw…no comment from me as I don’t understand your comments.

Posted by: Royal Flush at October 13, 2011 4:48 PM
Comment #330513

Royal Flush-
To win the economic competition your way, we have to debase just about everything that made this country a great economic power, and a good place to live. Land of opportunity’s not going to mean much after decades of your policies have left infrastructure crap, people too poor to consume like they once did, etc. You tried so many of these things, and the only thing that has happened to most Americans is a diminishment of their fortunes, for the sake of a few who didn’t need the extra help.

As for assets?

If assets are these wonderfully stable things, why did the collapse of Lehman Brothers set off such a panic? What is a toxic asset, in that case, and why are they such a problem for the banks, requiring their bailout? A court can order repayment to creditors, but that doesn’t mean creditors get made whole on their debts, that doesn’t mean things get paid off, that doesn’t mean their own assets are worth what they once were before hand, etc.

In short, what many of the banks and corporations were counting on seeing on their balance sheets isn’t going to show up when it’s supposed to, which means they’re in trouble, even if at some point, some person hands them a sheet of paper that says they have the right to be paid back at some point.

Follow the news some on bankruptcies. Hell, follow your own argument on Solyndra. Why is it bad that they’re going into bankruptcy? By your logic here, we should expect the taxpayers to be paid back 100%, so it shouldn’t be a problem, right?

Bankruptcy does not maintain the normal flow of repayment of debts. That’s the whole point, since folks go into bankruptcy for protection from creditors.

Bankruptcies often mean reduced, delayed payoffs for creditors. Under the accounting rules they were operating under, that means the banks that didn’t fail still saw a big new hole develop in their finances.

The bills your political movement helped make the law of the land made it easier for big banks, investment banks and other firms to get involved in risky business interactions, with largely unregulated derivatives forming the huge bulk of those assets. Your policies led to this mess, led to “Too Big To Fail.”

I read what you wrote just fine, but your premises are faulty, and I know enough about how things like Bankruptcy and corporate finance work to know that your idealization of bankruptcy with the big banks would hardly be the safely contained walk in the park you’re implying.

Posted by: Stephen Daugherty at October 13, 2011 6:00 PM
Comment #330516

An asset, or anything else for that matter, is only worth what someone will pay to own it at some point in time.

If a bank or other financial concern intentionally inflates its assets values and then sells that asset to another based upon those inflated values, it is a criminal act. It certainly should not be rewarded with a bailout by the taxpayer.

The bailouts given by government to some such institutions allowed them to stay in business rather than declare bankruptcy. In doing so, they rewarded these criminals. Are the assets of those institutions increased by the bailout? Of course not, unless it was given as a gift and not expected to be paid back.

Since the asset value of the company was not increased by the bailout, the asset value would be the same if the company filed bankruptcy. Is it not logical to assume that those who purchased the assets through bankruptcy would do a better job of handling those remaining assets? They could hardly do worse!

SD writes; “Follow the news some on bankruptcies. Hell, follow your own argument on Solyndra. Why is it bad that they’re going into bankruptcy? By your logic here, we should expect the taxpayers to be paid back 100%, so it shouldn’t be a problem, right.”

Well even though that is an extremely stupid comment I will favor you with a response.

Solyndra does have some assets in the form of real estate and equipment that is worth something to someone. The reason taxpayers will see no part of any remaining assets is because the obama fart heads placed other investors ahead of the taxpayer. Why was that done do you think?

If one of the TBTF companies files bankruptcy after receiving a taxpayer bailout, will the taxpayer come last also in participating in the share of assets remaining? Of course we will.

Do you know why Solyndra couldn’t obtain private funding? Do you know why government was willing to risk taxpayer money in this fiasco? Do you know why government placed private investment money ahead of taxpayer money in the case of bankruptcy? Do you know why government didn’t bail out Solyndra?

SD may understand the mechanics of bankruptcy, or maybe he doesn’t, but…he fails to understand why it is such a valuable tool in capitalism.

Posted by: Royal Flush at October 13, 2011 6:39 PM
Comment #330528

The banks were in serious trouble due to the complex, opaque mortgage backed securities that they were holding. The market had disappeared for them and as Rhinehold has pointed out, mark to market accounting forced a write down of value well below their long term value (most were still performing).

Bankruptcy, at that time, would have forced a realization of a tremendous amount of unnecessary losses from mortgage backed securities held by the banks. Those losses would have been staggering. The impact on the economy enormous.

The Troubled Asset Relief Program (TARP) was initially proposed to deal with that problem by extracting them from the banking system and sequestering them (bad bank) until the market returned and the true state of those securities fully determined. That goal of TARP was eventually abandoned and it was the Fed who did the heavy lifting in creating a market for securities by purchasing about $600 billion of them for face value in late 2008-2009 (QE1). The Fed has been unwinding its portfolio of those assets and has made a profit on the investments. Whether it can fully unload the securities without incurring a loss remains to be seen.

The point is that a straightforward bankruptcy of the major banks in 2008 would have been a disaster.

But there were other options like that used in the late 80s during the savings and loan failures. Why a model like that wasn’t used and a new Resolution Trust Corporation (RTC) formed to hold, manage and eventually sell off portfolio assets held by the banks is unclear. I suspect it was because the amount of taxpayer dollars that would have to have been allocated would have been politically transparent and prohibitive. Better that the Fed quietly assume the responsibility. The secrecy surrounding those purchases lends some credence to that thought.

In any case, it wasn’t our finest hour. The absence of a dissolution mechanism for banks which contain systemic risk and holding enormous amounts of impaired assets was an unnecessary problem. The “required” bailout of Continental Illinois in the early 80s was a clear signal that the issue should have been addressed decades ago. Both parties have responsibility for allowing this glaring weakness to continue and to grow over the decades as bank mergers and consolidation accelerated.

Posted by: Rich at October 14, 2011 7:20 AM
Comment #330530

Royal Flush-
There’s so much emotional BS in your comments here.

You call what they did criminal, and then talk about rewarding it with a bailout. Problem is, your people lead the charge on making much of what they did legal, and the bailout wasn’t a reward, it was a defensive measure taken against the collapse of the markets.

You can turn on them now, because it suits you to, politically. Or have you turned on them? I mean, you’re quick to say that they should have been allowed to fail, and that these bankers were criminals, but in the meantime, you resist changing the laws to prevent them from doing whatever they were doing all over again. You even resist calls to claw back the money when those folks gave themselves ludicrous bonuses out of the money taxpayers fronted them to keep them in business.

The only consistency to your policy is that it takes advantage of the fact that Democrats had to do some unpopular but necessary things in order to keep our economy from collapsing. What you fail to realize is that your party’s leg is in the bear-trap, too, and that your party’s put itself there, too.

The reason taxpayers will see no part of any remaining assets is because the obama fart heads placed other investors ahead of the taxpayer. Why was that done do you think?

Interesting response, since you’re acting like bankruptcies for the world’s biggest banks would be no problem. You’re saying here that others would see a delay in their repayments. Why would that matter? Yes, Solyndra has assets to sell, but the value of those assets aren’t fixed, and much of the other worth of the company is of course gone. It’s not a simple game of shuffling around the same value’s worth of assets, it’s more complicated than that.

Do you know why Solyndra couldn’t obtain private funding?

Stupid question. It did secure private funding.

Do you know why government was willing to risk taxpayer money in this fiasco?

Well, lobbying had something to do with it, but also the fact that the process Solyndra came up with was cheaper and more efficient than other kinds of solar panels at the time.

Do you know why government placed private investment money ahead of taxpayer money in the case of bankruptcy?

Perhaps to avoid the criticism that private investors were getting screwed to pay off the government first.

Do you know why government didn’t bail out Solyndra?

Because there is actual competition in the solar power market, so if you let one competitor fail, it doesn’t take the whole sector with it.

See, that’s the value of preventing such conglomerates. You can let individual companies fail. If we had kept laws in place discouraging consolidation of such industries, the banks that did screw things up could have been replaced in their role by the ones that didn’t screw things up.

I understand what the role of bankruptcy is, why we need it.

But if you let four or five banks become the predominant engine of finance, and then you let them entangle each other with exotic financial instruments to the point where one can’t fail without pushing the others towards doom, there are consequences to the bank’s failure, even if the collapse is managed by bankruptcy.

You can talk all you want to about letting things take their natural course, but when the natural course seems to be going off the cliff, government intervention becomes necessary. Me? I think if you want to minimize government intervention, you create a system which is failsafe, rather than one that seems to compound it’s own weaknesses as it responds. If we break up the banks, and find some means of unwinding their obligations, we can let them fail. If we regulate derivatives so these companies can’t take such hideous risks outside the view of their investors, then they might not be so proned to fail like this.

The market relies on information. More information on derivatives, and better information on corporate finance might help the market regulate things before they get out of hand.

So on and so forth.

Now, it might not make some as much money, and you might mourn that, but there are plenty of ways to make money in a productive, healthy way, that we can encourage in the stead of risky, financially harebrained get-rich-quick schemes.

Posted by: Stephen Daugherty at October 14, 2011 9:42 AM
Comment #330572

Speaking of jobs bills, the dumbest one to date and IMO of all time is Rep. Jesse Jackson’s DEMOCRAT, plan for the government to hire all unemployed persons and pay them $40K.per year.

Posted by: KAP at October 15, 2011 11:27 AM
Comment #330576

KAP

i guess the nut doesn’t fall far from the tree eh.

BTW,hope you enjoyed that round of late warm weather we’ve had. i know i did. i think it’s over though, and i think the snowfall is gonna be a real b#tch this year.

Posted by: dbs at October 15, 2011 1:26 PM
Comment #330577

Got thyat right dbs, yes I think it’s going to be a bad one this year. I missed the winter of 78 because the Navy had me vacationing in Europe.

Posted by: KAP at October 15, 2011 2:04 PM
Comment #330578

KAP and dbs

In northern AZ we had our first blizzard. Got an inch and it disappeared within the hour. About a week ago. lol

Maranatha

Posted by: tom humes at October 15, 2011 3:26 PM
Comment #330584


Did you fellas consult the Farmers Almanac?

Posted by: jlw at October 15, 2011 4:40 PM
Comment #330585

No jlw Dick Goddard, he’s the local weatherman.

Posted by: KAP at October 15, 2011 4:44 PM
Comment #330590

Global warming or climate change, is an empirical question. Its not a political question. The evidence seems clear. There is global warming. That’s a fact.

Has the burning of fossil been a major contributor to the warming and climate change? The consensus view of scientists, including the Bush administration’s scientific review, is yes.

Is this a cause for alarm? There is a strong consensus, including the last review by the Bush administration, that it is indeed a cause for alarm.

So, why do we have this weird conservative vs. liberal controversy on this issue? It is or it isn’t. We have to do something about it or we don’t. What’s this issue got to do with politics?

Posted by: Rich at October 15, 2011 8:24 PM
Comment #330594

GW is the latest of a long list of religions of the left. It is used as a scare tactic for the purpose of raising taxes and wealth redistribution. GW is meant to cause Americans to hate fossil fuel. We have nothing to take the place of fossil fuel and we have an abundance of the stuff, even though the left continues to peddle their propaganda that we have limited supplies in America.

Now if the left really wants to protest the use of fossil fuel; why don’t they go protest in China? China’s pollution, as a result of the use of coal and oil, is reminiscent of the US in the 60’s.

It seems the left’s protests are all screwed up. They condemn China for selling cheap products in the US and for manipulating their currency, and yet have no problem which their use of coal and oil, or the terrible pollution which is created. Kind of reminds one of the WS protesters, who protest capitalism, while communicating with each other by smart phones and laptops, which were created by a capitalist. Or, protesting cost of paying back school loans to universities who raise their prices every year. Why aren’t they protesting at the gates of institutions of higher learning?

Posted by: Mike at October 15, 2011 10:16 PM
Comment #330595

“China’s pollution, as a result of the use of coal and oil, is reminiscent of the US in the 60’s.”

How did it get cleaned up?

Posted by: Rich at October 16, 2011 6:28 AM
Comment #330601

No Rich, the question to you is, “how are you going to make China, Russia, or any other country comply with your version of rules?” Or is this just a punish America program?

Posted by: Mike at October 16, 2011 4:46 PM
Comment #330619

dbs-
Oh, I thoroughly enjoyed the hottest summer America ever had. No global warming, nothing here to see. Move on.

Mike-
Look, if Global Warming is a religion, the basic question is why you’re not an adherent. I mean, the evidence is overwhelming, and the folks in denial are just recycling questions that were answered fifteen or twenty years ago.

If some Religions had the hard data backing them that Global Climate Change has, low church attendance would not be a problem.

The irony is, you describe Global Warming as a religion to discredit it, and those who agree with it. If I were to confront you over Christianity, and bash their belief on that account, you would be ripping me a new one over that, or at least trying.

But Global Warming is not a religion, it’s a scientific theory which is empirically provable. Things like the way the stratosphere has gotten colder, the way that certain isotopes of carbon show up, the way the temperature changes are more consistent with greater retention of warmth, rather than greater solar irradiation help to support the claims of those who adhere to the theory. You can point to something and say both that it is capable of confirming or disconfirming the claim, and say that Global Warming theory passes most of those tests.

I’m not too critical of religion, being an adherent to one myself, but I think you misuse the word to malignant effect. It is not what cannot be proven that forms the grounds of our theory here, but what can be, and unfortunately, you’re too concerned with playing politics with science to actually concede what can be demonstrated in fact.

Now before you demonstrate your ignorance by claiming that there must be absolute proof, let me tell you something: there’s no such thing in science. Science is tentative. Unfortunately, some of your appeals go in the exact opposite direction, claiming a kind of wishy-washiness to science that it does not have. Science is contingently tentative, meaning that all theories have their weaknesses, their incompleteness, but these are not cause to simply throw everything that has been learned and observed and understood away. It’s reason, instead, for careful adjustments and measurements, for calibrations, for an examination of the problem in greater depth.

Let’s take the recent neutrino experiment at CERN. For some odd reason, they’ve gotten a result from that test, which was intended to determine the pace at which Neutrinos changed what kind of neutrino they were, that seems to contradict the assertion that nothing with any rest mass can go faster than the speed of light in a vacuum.

Does that utterly destroy Special and General Relativity? No, not necessarily. First they have to prove that the measurement was not a fluke caused by faulty math, faulty measurement of distance, or improper measurement of time. Second, if it doesn’t turn out to be an artifact of the experimenter’s mistake, if the result is real, that doesn’t mean that Einstein’s theory has no use, or doesn’t reflect a truth.

People have seen what Einstein’s theories predicted. The theory that succeeds his theory has to explain not just the new facts, but the old ones as well. It has to be functionally equivalent elsewhere to Einstein’s theory, where Einstein’s theory sucessfully predicts the course of the real world.

If a successor theory doesn’t adequately explain observed differences in time’s passage between objects in different inertial frames of reference, if it doesn’t provide adequate explanation for the equivalence of mass and energy, then it is not going to dethrone Einstein’s theory, even if it’s flawed.

Which is to say that you can’t just cast doubt on a theory to make the claim you’re making. You’ve got to provide a better explanation, a better model, that better fits what is observed, what comes from experiment.

Global Warming “skeptics” have far from satisfied this requirement. They cast out the same claims again and again, make the same irrelevant appeals to economics, and do little better than sow doubts, many of which are even empirically disprovable now.

It’s a lot easier to get people to question reality, than to substitute a better explanation.

But let’s address your economics here: China and india are already looking into this stuff, and pretty much for the reasons we are: because energy, as time goes on, is only going to get more expensive, even if Global Warming is the lie you say it is.

This is a simple fact of increased demand for a supply that is increasing nowhere near as fast. The rest of the world is competing for our lifestyle, and they’ll do what they have to in order to get it, and in order to profit by others trying to get it.

They’re already making moves to hoard critical minerals for creating green technologies, Even while the fools in Washington do their best to sabotage government support here for the same industries.

Or put another way, your party’s policy seems to be to punish America to make sure that it is at the ass-end of any conversion to alternatives, a Johnny-come-lately to the game who will end up having to buy its green technology from China, rather than manufacturing and exporting it from home.

As for the Occupy Wall Street Movement? Fact is, most of those people don’t object to capitalism. They object to Wall Street’s incompetence, it’s corruption, it’s failure to keep the capitalist system properly working, and its continued resistance to any kind of reform to make sure things don’t repeat again, and people can get back to work.

You just red-bait these people all the time because you don’t have any good ideas, much less new ideas of how to improve things. You just don’t want to give up power, regardless of how screwed up things have gotten. You don’t even really want to admit that your experiment in the lawless, degenerated operation of our capitalist system failed.

So you distract people with bull**** claims that these people, that liberals and Democrats really want to destroy the economy. You pile the propaganda on top of the vilification, on top of the demonization, until you’ve created cariactures that should be drawn with mustaches to twirl.

We want a better economy, in both senses of the word. We want growth, and we want reform. If you want us to be the last folks to figure it out on that one, too, be my guest. I’m going to workfor the benefit of this country now.

Posted by: Stephen Daugherty at October 17, 2011 11:54 AM
Comment #330634

Good lord Stephen, give it up… Your still out here defending GW, which no one with a brain believes. It’s like Obama sending his obamacare to the CBO; when you feed in false information, you get false results. It now turns out that obama’s HC bill will lose $9 billion of the surplus they were supposed to have, as a result of the loss of long term health ins. It’s the same with GW; when false info is fed in, false results come out. It turns out that facts (temps and dates) were falsified; investigations are now taking place concerning the falsification of the death of polar bears. And here you are Stephen, still defending the indefensible. Is GW a religion? Yes, to the left it is. It’s a religion as much as abortion is a religion of the left. Hating the rich is a religion. In fact every agenda of the left becomes a religion to them.

“As for the Occupy Wall Street Movement? Fact is, most of those people don’t object to capitalism. They object to Wall Street’s incompetence, it’s corruption, it’s failure to keep the capitalist system properly working, and its continued resistance to any kind of reform to make sure things don’t repeat again, and people can get back to work.”

This is complete BS. If these clowns want to protest someone, why don’t they go to DC and protest the government. You guys on the left are so jealous of the TP and it’s grass roots origin of everyday people, and yet your movement is nothing. No central thought, no goals; just a mishmash of complaints and you want it to be equal to the TP rallies. As one of the other libs on WB was told; when you can effect an election, comeback and talk about your movement. Obama has stuck his neck on the chopping block defending and supporting the clowns, and when it becomes violent, there will be hell to pay. Obama and his admin are absolutly terrified and are using you suckers to try to take people’s minds off of his failures.

Had obama and his bailouts not interferred with the capitalist system, we would already be on our way to recovery; but no, obama had to bail out his union buddies and their pension funds. Get a life Stephen, your views represent about 10% of the wackos in this country.

Posted by: Mike at October 17, 2011 7:20 PM
Comment #330635

Mike, I agree that the MMGW push is nothing but…”hot air”. As you wrote…garbage in, garbage out. SD is so impressed with his writing that he simply forgets to think.

The obama mask is coming off and we are seeing the true nature of this person. He is being revealed as a true socialist who espouses income and wealth redistribution. Of course, those who can read, and think, knew that early on in his campaign. He has said as much.

The mask is also coming off those who are pushing the WS mob. The dunces on the street don’t even know they are being used by those who hate capitalism and individualism.

As more light is being shed on the billions of borrowed public money being spent for political purposes it will, I believe, become intense before November 2012. It is not possible to keep a lid on the corruption taking place in this administration. obama will have his own “Watergate” and it will be horrendous.

Posted by: Royal Flush at October 17, 2011 7:36 PM
Comment #330636

Obama’s not in Chicago anymore. These protests are going to backfire. The events taking place in other nations will embolden these radicals on WS to become more violent, and when it happens the American people are not going to like it. Obama has bet his whole re-election campaign on these protests.

As for Stephen, he lives in his own little fantasy world. So his rediculous comments don’t impress me.

Posted by: Mike at October 17, 2011 7:51 PM
Comment #330646

Socialist/Democrat/Leftist Illinois representative Jan Schakowsky marching lockstep with the Communist Party in one of the protests. And we have people on WB that say we are all wet when we give evidence of where these minions position themselves.

Just one of many that fill the bill of people in authority that want to destroy this great nation of ours.

Maranatha

Posted by: tom humes at October 17, 2011 9:23 PM
Comment #330655

Royal Flush


“The dunces on the street don’t even know they are being used by those who hate capitalism and individualism.”


yes, i think lenin refered to them as useful idiots.

Posted by: dbs at October 18, 2011 5:28 AM
Comment #330660

When the violence starts and people die and property is destroyed, they will be referred to as “cannon fodder”.

Posted by: Mike at October 18, 2011 11:27 AM
Comment #330673

Mike-
Estimates and proposals can be wrong in the real world, without people being liars. It might be helpful, though, if you remember just what that error you describe is cutting out of. The final healthcare bill saved 143 billion over ten years, according to estimates, so that comes to 134 billion dollars in saving now.

Geez, raise those deficit red flags.

As for global warming? Let me be blunt: yours are the false arguments. Three or four seperate organization examined the data from the so-called Climate Gate, and concluded there was no scientific misconduct. The numbers were right, your assumptions are wrong. Your people are jumping at BS, because all you ever do is try and discredit climate researchers and climate scientists. Meanwhile, you have no alternative scientific explanation, just a grab-bag of old and outdated claims offered forth to gull the scientifically illiterate.

I mean, why else are you folks always talking about “shocking developments” Folks who rely on shock value often end up being the people who overreached themselves on an argument trying to push people emotionally.

As for Occupy Wall Street? Well, we don’t envy them. First, we didn’t have to get organized by a whole bunch of Koch-backed astroturf groups, we genuinely organized ourselves. We didn’t get instant Fox coverage, no we had to fight for media coverage. But we got it!

More to the point, we’ve got a big advantage: the OWS movement is a much more direct and purposeful confrontation of the powers that be. It’s purpose flows naturally from the frustrations many Americans have, which is why it’s so instantly sympathetic to so many. Our concerns are their concerns. The Tea Party was, for the most part, a forced popular culture phenomenon.

Our movement is the more natural one, the more grassroots one in reality. We are what the Tea Party pretended to be.

Had obama and his bailouts not interferred with the capitalist system, we would already be on our way to recovery;

Revisionist history at its worse. TARP was created in fall of 2008, before Obama was elected. The Panic in the markets did not cease when the first version of TARP was voted down with the help of nearly every Republican, it got worse.

By the way, letting Lehman Brothers fail didn’t help things either. If it was any indication of what the consequences of the big banks going down would do, then we would have been utterly screwed without the bailout.

You need to stop letting your rhetoric lead your thinking. Fiery words do not equal wisdom or comprehension.

Obama’s not in Chicago anymore. These protests are going to backfire. The events taking place in other nations will embolden these radicals on WS to become more violent, and when it happens the American people are not going to like it. Obama has bet his whole re-election campaign on these protests. As for Stephen, he lives in his own little fantasy world. So his rediculous comments don’t impress me.

Let me return the favor by saying how unimpressed I am by your comments. You think that a person like me, who’s been blogging for going on eight years, hasn’t had his hair blown back in a permanent orange afro by a dozen folks just like you?

These protests have gone on for about a month. They have yet to degenerate into violence, despite several incidents in which protestors were injured by police.

I think it’s telling that you’re practically rubbing your hands with glee, waiting for things to get nasty. Who is living in their fantasies here?

You actually think that those protestors are unaware of what you want to happen? You think they’re not organizing against that?

Royal Flush-
You’re so impressed with your putdowns you forget to do much else than insult people. They aren’t a mob. A mob would have burned things and rioted by now. It’s a grassroots movement with strong public sympathy. It’s not people who hate capitalism, it’s people who hate what it’s become under your party’s laissez faire mismanagement.

You want Watergate for the same reason you wanted Whitewater and all that other BS: you’re too wrapped up in your own partisanship to understand that you have to do more than discredit your opponent to get people to trust your leaders instead. Bush came into office, claiming he would restore integrity and morality to the White House and the Government, and instead we had people from the interior department snorting meth off of toaster ovens, Jack Abramoff running schemes, and Bernie Kerik flaming out, etc.

So much of Republican efforts these days seem to be focused on Bringing Obama and the other Democrats down to their level, rather than improving their own competence, their own ability to govern well and wisely. Your party needs to get over its envy of competent, charismatic Democrats, and cultivate better, more in-touch leaders.

Posted by: Stephen Daugherty at October 18, 2011 4:29 PM
Comment #330677

SD

“The final healthcare bill saved 143 billion over ten years,…”

It has saved nothing. You are using past tense as if there is a fact of accomplishment. There is none. Quit trying to prophecy something that is so out of reach for anybody.

CLASS is being dropped. That will give “your people” the axe on the “health care act”. That is perfectly fine with me.

I have been writing at various levels on a wide range of subjects for over forty years. So what? Your ego is sagging to your toes again. Quit trying to project yourself as an expert on anything. You have not convinced anybody at this location. I should retract that. You are good at writing fiction.

Maranatha

Posted by: tom humes at October 18, 2011 4:42 PM
Comment #330748

Here is something especially for SD. Since he is worshiping at the altar of GW, and is one of the few who are defending this lie, which is promoted by the left for tax increases:

http://www.powerlineblog.com/archives/2011/10/the-wheels-are-coming-off.php

And here is one of the best responses to the article:

Russell Davis · Top Commenter · Fort Wayne, Indiana

“Repeat a lie often enough and fools’ll believe anything. What’s a “greenhouse gas” other than what’s coming out of algore’s mouth and anus? Pure propaganda without an ounce of integrity, typical for the modern pseudo-science Ben Stein exposed in “Expelled.” Real science advanced under its creationist founding until the clergyman based bigotry of Darwin adopted by the Nazis & Soviets in opposition that eventually took over the West without firing a shot, turning the blind, stupid fools against the very beliefs their boys died for in WWII. Now this alien propaganda delusion of clergyman Darwin, funded by perverts and moneypockets, is destroying the true science of creationists Newton, Galileo, Pasteur, Lister, etc. under which we advanced with its system-wrecking counterfeit extensively refuted at various true science sites like www.creation.com and www.trueorigin.org. Russ Humphreys’s creation model correctly predicted basics of what the outer planets and their moons would be like BEFORE Voyager 2 got there but enslaved fascist evolutionists/Darwinists bombed, yet the matter was covered up by the regime to save face and keep people from discovereing the fraud of the crowd, others of whose members are now spinning algore’s global cooling/warming scam that turns cold and hot every few decades to keep people fooled into thinking these useful idiots actually know what they’re talking about.”

Stephen, your GW theory is falling apart…

Posted by: Mike at October 19, 2011 7:47 PM
Comment #330791


“Real science advanced under its creationist founding until the clergyman based bigotry of Darwin adopted by the Nazis & Soviets in opposition that eventually took over the West without firing a shot…”

“…is destroying the true science of creationists Newton, Galileo, Pasteur, Lister, etc…”

It’s interesting that the author would trash Darwin in virtually the same breath that he would praise Galileo.

Galileo believed that the writers of the Scripture merely wrote from the perspective of the terrestrial world, from that vantage point that the sun does rise and set.

Galileo turned the Christian view that the earth was the center of the universe on it’s ear when he supported the Copernican view of heliocentrism. Though there are dolts out there that still believe otherwise;

http://blogs4brownback.wordpress.com/2007/05/18/heliocentrism-is-an-atheist-doctrine/

“It seems clear that it may occasionally be convenient to assume that the calculations of Copernicus and Kepler were mathematically sound. However, for both moral and theological reasons, we should always bear in mind that the Earth does not move. If it moved, we would feel it moving. That’s called empiricism, the experience of the senses. Don’t take my word for it, or the evidence of your own senses, Copernicans. There’s also the Word of the Lord:
“He has fixed the earth firm, immovable.” (1 Chronicles 16:30)
“Thou hast fixed the earth immovable and firm …” (Psalm 93:1)
“Thou didst fix the earth on its foundation so that it never can be shaken.” (Psalm 104:5)
“…who made the earth and fashioned it, and himself fixed it fast…” (Isaiah 45:18)
“The sun also ariseth, and the sun goeth down, and hasteth to his place where he arose.” (Ecclesiastes 1:5)”

Darwin reported what he observed, just as Newton, Galileo, Kepler, etc, reported what they observed.

Your source chooses, like the link I provided, not to observe, but to merely believe.

That ain’t science pal.

Rocky

Posted by: Rocky Marks at October 20, 2011 2:55 PM
Comment #330844

There’s also the Word of the Lord:
“He has fixed the earth firm, immovable.” (1 Chronicles 16:30)
“Thou hast fixed the earth immovable and firm …” (Psalm 93:1)
“Thou didst fix the earth on its foundation so that it never can be shaken.” (Psalm 104:5)
“…who made the earth and fashioned it, and himself fixed it fast…” (Isaiah 45:18)
“The sun also ariseth, and the sun goeth down, and hasteth to his place where he arose.” (Ecclesiastes 1:5)”
Darwin reported what he observed, just as Newton, Galileo, Kepler, etc, reported what they observed.
Your source chooses, like the link I provided, not to observe, but to merely believe.
That ain’t science pal.
Rocky”

Posted by: Rocky Marks at October 20, 2011 2:55 PM

Why do you liberals continue in an attempt to quote the very Scriptures of which you do not believe?

“He has fixed the earth firm, immovable.” (1 Chronicles 16:30)

The KJV says “Fear before him, all the earth: the world also shall be stable, that it be not moved.”

The Hebrew word “ מוט” does not refer to a locked position, but rather “to waver, to slip, shake, fall”

“Thou hast fixed the earth immovable and firm …” (Psalm 93:1)

The KJV says “The LORD reigneth, he is clothed with majesty; the LORD is clothed with strength, wherewith he hath girded himself: the world also is stablished, that it cannot be moved.”


It is the same Hebrew word, with the same meaning.

“Thou didst fix the earth on its foundation so that it never can be shaken.” (Psalm 104:5)

The KJV says “Who laid the foundations of the earth, that it should not be removed for ever.”

Yes, you guessed it, the same Hebrew word.

“…who made the earth and fashioned it, and himself fixed it fast…” (Isaiah 45:18)

The KJV says, “For thus saith the LORD that created the heavens; God himself that formed the earth and made it; he hath established it, he created it not in vain, he formed it to be inhabited: I am the LORD; and there is none else.”

This one is a little different, it is the Hebrew word “כּוּן” and means to “establish, fix, prepare, apply”, but nothing about a fixed position.

“The sun also ariseth, and the sun goeth down, and hasteth to his place where he arose.” (Ecclesiastes 1:5)”

Interesting that you would use the KJV on this one. The best I can tell you is look this one up as you have all the verses, but the meanings of the words are not what you are alluding to as a moving sun.

Ariseth: זרח, meaning to irradiate (or shoot forth beams)

Goeth down: בּוא, meaning a primitive root; to go or come (in a wide variety of applications): - abide,

Arose: the same meaning as ariseth.

My suggestion to you is to stick with what you know best, personal attacks on conservatives. Not one of your verses can be used to say that God was moving the sun out of it’s fixed position in the center of our solar system. If what you say was true, the Bible would have been proven to be false hundreds of years ago. And that ain’t happened.

Posted by: Mike at October 21, 2011 7:41 PM
Comment #330845

Mike,

The quotes I used came from the website I linked. I merely added them to show that there are still idiots out there that don’t observe but just believe.

Apparently you neglected to actually read what I wrote that wasn’t within the quotation marks, and didn’t read the link I supplied.

So are you an observer, or merely a believer?

Rocky

Posted by: Rocky Marks at October 21, 2011 7:55 PM
Comment #330846

Oh, and BTW, I found the link when I googled “heliocentrism”. Strangely enough the web site was on the first page of the google results.

Rocky

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Comment #330862

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Posted by: zsdf at October 22, 2011 3:46 AM
Comment #330955
“Repeat a lie often enough and fools’ll believe anything. What’s a “greenhouse gas” other than what’s coming out of algore’s mouth and anus? Pure propaganda without an ounce of integrity, typical for the modern pseudo-science Ben Stein exposed in “Expelled.” Real science advanced under its creationist founding until the clergyman based bigotry of Darwin adopted by the Nazis & Soviets in opposition that eventually took over the West without firing a shot, turning the blind, stupid fools against the very beliefs their boys died for in WWII. Now this alien propaganda delusion of clergyman Darwin, funded by perverts and moneypockets, is destroying the true science of creationists Newton, Galileo, Pasteur, Lister, etc. under which we advanced with its system-wrecking counterfeit extensively refuted at various true science sites like www.creation.com and www.trueorigin.org. Russ Humphreys’s creation model correctly predicted basics of what the outer planets and their moons would be like BEFORE Voyager 2 got there but enslaved fascist evolutionists/Darwinists bombed, yet the matter was covered up by the regime to save face and keep people from discovereing the fraud of the crowd, others of whose members are now spinning algore’s global cooling/warming scam that turns cold and hot every few decades to keep people fooled into thinking these useful idiots actually know what they’re talking about.”

Award Russell Davis a Nobel Prize! Look like he just disproved the last 150 years of physics! Russell Davis has said it, therefore it must be true!

I guess we were wrong about quantum mechanics all along as well. According to Mr. Davis, gases do not absorb and re-emit heat at particular frequencies (except when Al Gore’s bodily orifices are involved?). Also, Davis is either claiming that all objects in the universe are

The Hebrew word “ מוט” does not refer to a locked position, but rather “to waver, to slip, shake, fall”

I always find it hilarious to see non-Jews try to interpret Hebrew. The Hebrew in the Leningrad Codex goes like thisבַּל־תִּמּֽוֹט ׃
The “ מוט” is preceded by בַּל־ which means “not”. This brings us back to the original translation of an unmoving Earth. This is not an attack on the Bible’s theological or philosophical accuracy, but merely a reflection of what the Bible is not. Scripture was never intended to be a science textbook, it’s claims about the universe only occur in the context of poetry with the primary intent of telling us how to forge a personal relationship with God.

Posted by: Warped Reality at October 24, 2011 12:15 AM
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