Monthly Archives: September 2008

Pay the Fiddler

If any gentlemen, whose money is a burden to them, choose to lead off a dance, I am decidedly opposed to the people’s money being used to pay the fiddler.Abraham Lincoln

In this week’s Sift:

  • Bailout Deal: I Wish I Knew What to Tell You. But I don’t. The people who think they do all disagree.
  • Debate Reaction. McCain needed to back up his claim that he can lead and Obama can’t. He didn’t, so the tie goes to Obama.
  • Financial Crisis: The Brown People Did It. The ugliest meme around today is the one that blames the financial crisis on minorities and immigrants.
  • This Week in Sarah. Palin’s Couric interview panicked people all across the political spectrum. And part of it hasn’t come out yet.
  • Short Notes. Paul Newman. The difference between Christians and Christianists. What “freedom of the press” means in St. Paul. And neither George Will nor David Letterman is happy with John McCain.


Bailout Deal: I Wish I Knew What to Tell You

Last minute update (2:30 p.m.): The House defeated the bailout 228-205, with “less than a third” of House Republicans voting for it. The Dow is down 517 points.

Like every other recent weekend, this one brought big economic news that is hard to evaluate Monday morning. Congressional leaders and the administration have agreed on a $700 billion financial-system bail-out plan. The original 3-page plan has expanded to 110 pages (which I confess I haven’t read).

The original Paulson plan was almost universally denounced. There is general agreement that the current bill is an improvement, but it’s still not popular. The improvements:

  • Oversight. In the original, Paulson’s decisions would be final.
  • Warrants. The government is going to get an option to buy stock in the companies it helps. If their stockholders benefit, the taxpayers will capture some of that benefit.
  • Not releasing all the money at once. I’m not as thrilled with this as some people are, because the procedure for blocking the later chunks of money looks too cumbersome to work unless some gross malfeasance is happening.
  • Executive pay cap. Again, I’m not as excited as a lot of people. I’d be amazed if there weren’t a bunch of ways around this.

The House Republicans are still threatening to revolt against this deal. In theory, House Democrats could pass the plan without the Republicans, but it’s generally agreed that would be suicide: It would let Republicans run against Bush-and-the-Democrats. In other words, it undoes the theme of the Democrats’ whole fall campaign.

The obvious question, then, is why the Democrats would vote for this plan at all. The simple answer seems to be true: When the Treasury Secretary and the Chairman of the Federal Reserve come to you and say that we might be going into another Great Depression (and non-government folks like Warren Buffett agree), it’s hard to say no. Democrats have a lot of doubts about this program, but they don’t have the kind of certainty they think they need to oppose it. If that sounds a lot like the Iraq vote in 2002, well, yes, up to a point. But Hilzoy notes:

some people write as though we’re being asked to trust the Bush administration about the existence of a crisis. This isn’t true. It’s not like the runup to the war in Iraq, where a lot of the crucial information was classified and we had to take the government’s word for it.

Liberal bloggers and pundits are split. This isn’t the plan that Paul Krugman would have designed, but he believes we need to do something. So if the choice is yes or no, he says yes. David Sirota and Sterling Newberry say a resounding no. Josh Marshall, like me, doesn’t know what to think.

A lot of liberals would prefer that we follow the model that Sweden successfully used during its banking crisis in 1992. (The warrants in the current plan lean in that direction, but don’t go as far as the Swedes did in government ownership.)

As for what will happen if the bailout passes, it’s anybody’s guess. Barrons even claims the taxpayers will make money on the deal. Seems unlikely to me, but why not? I can’t disprove it.

Meanwhile, the dominoes continue to fall: Morgan-Chase picks up the failing Washington Mutual and Citicorp grabs distressed Wachovia. Next?


Very few articles make the connection between the credit crunch and stuff you can see. That’s why I thought this was interesting: McDonalds thinks it needs to reassure its franchisees that they’ll be able to get financing for the McCafe upgrade.



Debate Reaction

My immediate reaction to Friday’s Obama-McCain debate was more-or-less in line with the way the story has spun out since: There was no knock-out punch, which works to Obama’s advantage.

The danger of making experience your central issue and claiming that your opponent is “not ready to lead” (but you are) is this: When you finally debate your “unqualified” opponent, the difference needs to be apparent. If the other guy looks equally well prepared, he wins. That’s what happened Friday. (Biden needs to watch out Thursday with Palin.)

Nonverbal cues always play a big role in debates, and here the difference was clear: Obama looked at McCain, called him “John”, and acknowledged many times that McCain had made a good point. McCain didn’t look at Obama, called him “Senator Obama”, and acknowledged nothing.

How you read this difference seems to depend on your age and gender. (In post-debate polls, men gave McCain a small advantage while women overwhelmingly thought Obama was more impressive.) Older men (like David Broder) tended to interpret McCain’s behavior as dominant. The McCain campaign apparently saw it this way themselves, and compiled all Obama’s “John is right” statements into an ad reiterating that Obama is “not ready to lead.” Young people and women tended to read it the opposite way: Obama was secure enough to give McCain his due, while McCain could not look Obama in the eye. (Primatologist Frans de Waal: “A confident alpha male chimpanzee would never show studied
indifference. I have seen such behavior only in males who were
terrified of their challenger.”)

This nonverbal stuff harmonizes with substance: Obama’s willingness to look at McCain harmonizes with his willingness to talk to hostile world leaders — you don’t have to agree with people to face them. His acknowledgement of McCain’s good points reinforces his claim to be able to work in a bipartisan fashion. McCain’s looking away likewise harmonizes with his view that you don’t talk to foreign leaders unless they submit first, but it conflicts with his claim to be bipartisan.

DailyKos’ DemFromCT sums up the post-debate polling, which looks good for Obama.

Financial Crisis: The Brown People Did It

I wish I were more familiar with the works of Joseph Goebbels, so that I could use the words of the Master to express this basic propaganda principle: When you’re caught holding the bag, blame some group even more unpopular than you are.

So imagine that you’re a free-market conservative, facing the obvious fact that unregulated capitalism has brought us to the brink of disaster. What to do? I know — let’s blame the whole thing on blacks and Hispanics. Here’s how Investors Business Daily does it:

For those looking for a real start to today’s financial meltdown and government rescue, you need to go back — way back — to 1977, and the Jimmy Carter presidency. … The CRA (Community Reinvestment Act) forced banks and savings institutions — then far more heavily regulated than today — to make loans to poor, often uncreditworthy minority borrowers. … Banks became pliable, easy targets. No bank CEO wanted to be mau-maued as an enemy of the poor.

There are a zillion things wrong with this interpretation, most of which are detailed in an article in The American Prospect. For example: Why did it take 30 years for the CRA to cause trouble?

Janet Yellen, president of the San Francisco Federal Reserve, offers the killer statistic: Independent mortgage companies, which are not covered by CRA, made high-priced loans at more than twice the rate of the banks and thrifts. With this in mind, Yellen specifically rejects the “tendency to conflate the current problems in the sub-prime market with CRA-motivated lending.”

And Rick Perlstein explains why non-performing mortgages are only the beginning of the problem:

none of the financial contagion — none of it — would have happened had not greedy financial institutions invented the risky securities that used mortgages as their foundation, via procedures that created economic incentives to write non-performing loans.

But why should facts stop conservatives from shifting the blame? The most outrageous version of this right-wing argument was made by Michelle Malkin in the New York Post.

But there’s one villain that has slipped notice: how illegal immigration, crime-enabling banks and open-borders Bush policies fueled the mortgage crisis.

Of course, nobody keeps statistics on mortgages to illegal aliens, so Malkin tries to support her claims by talking about Hispanics in general.

Half of the mortgages to Hispanics are subprime. A quarter of all those subprime loans are in default and foreclosure. … A July report showed that in seven of the 10 metro areas with the highest foreclosure rates, Hispanics were at least one-third of the population; in two of those areas — Merced and Salinas-Monterey, Calif. — Hispanics comprised half the population.

If you’re wondering what this proves — beyond Hispanics being disproportionately poor, and poor neighborhoods having more foreclosures — congratulations, you’ve seen through the fog.

But a lot of people won’t see through the fog. The state of our economy and the plan to bail out Wall Street with taxpayer money has made them angry, and so the Right is giving them someone to be angry at: blacks, Hispanics, immigrants, and poor people.


Those are our domestic troubles. The people you’re supposed to blame for our foreign troubles are Muslims. The right-wing Clarion Fund is distributing 28 million DVDs of the anti-Muslim documentary Obsession: Radical Islam’s War Against the West. Friday, distribution in Dayton was followed by someone gassing a mosque during Ramadan. Chris Rodda connects the dots.



This Week in Sarah

You know things are bad when your allies are asking you to resign and your opponents are starting to feel sorry for you. Conservative columnist Kathleen Parker says this about Sarah Palin:

Only Ms. Palin can save Mr. McCain, her party, and the country she loves. She can bow out for personal reasons, perhaps because she wants to spend more time with her newborn. No one would criticize a mother who puts her family first. Do it for your country.

Moderates and liberals agree: Newsweek’s Fareed Zakaria (“Is it too much to ask that she come to realize that she wants, in that
wonderful phrase in American politics, ‘to spend more time with her
family’?”) and the NYT’s Bob Herbert (“it would behoove John McCain and the Republican Party to put the country first — as Mr. McCain loves to say — and find a replacement for Ms. Palin on the ticket.”)

The New Republic’s Christopher Orr notes that Palin got worse between the Charles Gibson and Katie Couric interviews and wonders whether the McCain campaign has “broken” Palin:

I’m reminded of the situation you see every now and then in sports, when a talented athlete–which, conveniently enough, Palin was–gets a taste of heavy duty coaching and, rather than being built up, is broken down, losing confidence in his game, becoming tentative, second-guessing himself even to the point of paralysis.

The NYT’s Judith Warner looks into Palin’s frozen expression and feels sorry for her:

I’ve come to think, post-Kissinger, post-Katie-Couric, that Palin’s nomination isn’t just an insult to the women (and men) of America. It’s an act of cruelty toward her as well.

CNN’s Campbell Brown expressed a similar sympathy-with-a-twist when she railed against the McCain campaign for shielding Palin from the press and any hard questions.

Tonight, I call on the McCain campaign to stop treating Sarah Palin like she is a delicate flower that will wilt at any moment. … Allow her to show her stuff. … Sarah Palin has just as much right to be a real candidate in this race as the men do.

The cause of all this hand-wringing is Palin’s performance in the three interviews she has been allowed to have: Charles Gibson, Sean Hannity, and especially Katie Couric. Hannity is so pro-Palin that his interview has been called an “infomercial“, and Gibson and Couric are not known as tough interviewers. (By contrast, Obama has sat down with Bill O’Reilly.) None of them pushed her the way a hostile interviewer would —
on Troopergate, whether her daughter’s pregnancy has changed her mind about abstinence-only sex education, why her administration makes raped women pay for post-rape kits, her witch-hunting pastor, the cruelty of hunting wolves from the air, or a host of other issues. But in each interview, no matter how soft the questions, she could do nothing more than repeat canned talking points.

Somebody sent me this comment: “Sarah Palin is like an audio version of the Republican playbook magnetic poetry kit…that is, if you dumped the box on the floor and picked up random pieces and strung them together.” For example, this response to Couric:

But ultimately what the bailout does is help those who are concerned about the healthcare reform that is needed to shore up our economy … helping the … it’s got to be all about job creation too, shoring up our economy and putting it back on the right track. So healthcare reform and reducing taxes and reining in spending has got to accompany tax reduction and tax relief for Americans. In trade, we’ve got to see trade as opportunity, not as a competitive scary thing, but 1 in 5 jobs being created in the trade sector today — we’ve got to look at that more as opportunity. All those things under the umbrella of job creation — this bailout is a part of that.

“Did you get that?” CNN’s Jack Cafferty asked. “If John McCain wins, this woman will be one 72-year-old’s heartbeat away from being president of the United States. And if that doesn’t scare the hell out of you, it should. … I am 65 and I’ve been covering politics for a long time, and that is one of the most pathetic pieces of tape I have ever seen for someone aspiring to one of the highest offices in this country.”

And Howard Kurtz warns: “the worst may be yet to come for Palin; sources say CBS has two more responses on tape that will likely prove embarrassing.”

So it’s not surprising that the McCain campaign is doing everything it can to limit Palin’s exposure to unscripted exchanges. After Friday’s Obama-McCain debate Joe Biden was on every network, while Palin watched the debate in a bar. The networks wanted to talk to her, but the campaign didn’t make her available. And she’s even getting into trouble talking to ordinary voters over a cheesesteak.

The silver lining in Palin’s dark cloud is the advantage she has in Thursday’s debate with Biden: If she doesn’t make any huge errors, she’ll have exceeded expectations. Here’s what I expect: On Thursday Palin will attack with all the stuff too toxic for McCain to say — Rev. Wright, Bill Ayers, questioning Obama’s Christianity, and so on. The spin will be that this is fair play after all the attacks Palin herself has suffered.


Palin continues to be a godsend to comedians. If you don’t think Tina Fey’s portrayal of Palin is cruel enough, you should check out Sara Benincasa’s YouTube site. Ms. Benincasa has been doing a Sarah Palin video journal since the convention. After Matt Damon’s comment that Palin’s story sounded like “a bad Disney movie,” the folks at College Humor made a trailer for it. And 23/6 imagines Palin’s handler freaking out while watching the Couric interview.



Short Notes

The next time someone starts blasting the “liberal Hollywood elite,” remember to say a few words about Paul Newman. Liberal — yes; he took great pride in being #19 on Nixon’s list of enemies. Hollywood elite — certainly. But he was married to the same woman for more than 50 years and raised five daughters. He started a company that made more than $200 million, and he gave it all away. “I’m not running for sainthood,” he said. “I just happen to think that in life we need to be a little like the farmer, who puts back into the soil what
he takes out.”


Tristero on Hullabaloo points out the important distinction between Christians and Christianists, defined as “political radicals who use the symbols of Christianity in order to gain secular power.” It’s similar to the distinction between Muslims and Islamists.


Onion Radio News: A laid-off zoologist went on a rampage with a tranquilizer rifle, “brutally sedating” 12 zoo visitors and two employees. (I guess guns don’t tranquilize people; people tranquilize people.) And the Onion’s print edition reports that a Darwin-shaped wall stain has appeared in Dayton, Tennessee. Thousands of evolutionist pilgrims have turned the site into “a hotbed of biological zealotry.”


McCain has lost George Will.


The city of St. Paul has decided to drop charges against the journalists who were arrested during the Republican Convention. With no apparent intention of irony, Mayor Chris Coleman said, “This decision reflects the values we have in St. Paul to protect and promote our First Amendment rights to freedom of the press.” (In this context “freedom of the press” seems to mean the freedom to leave detention after the news-making event is over.) This is a good time to go back and watch Amy Goodman’s account of her arrest.


Comedian Jimmy Kimmel was not surprised when McCain temporarily suspended his campaign: “For a man his age, it’s very difficult to maintain an election.” The main victim of the campaign suspension seems to have been David Letterman, who was not happy about it.

Tomorrow Morning’s Revolution

It is well enough that people of the nation do not understand our banking and monetary system. For if they did, I believe there would be a revolution before tomorrow morning. — Henry Ford

In this week’s Sift:

  • The Bailout: Kwai Me a River. Here’s how you know that you’ve made it into the ruling class: Your privileges are so intertwined with the workings of society that any threat to you is a threat to everybody.
  • This Week in Sarah. Keeping up with Sarah Palin is like watching the soaps or the OJ trial. I’m not proud of it, but I can’t stop.
  • Short Notes. Donald Luskin’s bad timing. Pakistan will shoot at us to defend the Taliban. A few conservatives are going for Obama. And an interesting article on race.



The Bailout: Kwai Me a River

While I’ve been trying to figure out the proposed bailout of our financial system, I’ve been thinking about a bridge. No, not the Brooklyn Bridge. Not the Bridge to Nowhere. Not the newly re-opened bridge in Minneapolis, the one that collapsed last summer. Not even the symbolic Bridge to the 21st Century that President Clinton promised us in 1996. (Which is still unbuilt, as best I can tell. We remain on the ever-more-barren shores of the Age of Reagan, the promise of a new era still off in the mists somewhere.)

Instead, I keep thinking about the Bridge on the River Kwai. If it’s been a while since you’ve seen that classic film, the conflict begins when the Japanese try to make British POWs build a bridge for the strategically important Burma Railway. The ranking British officer (Alec Guinness) takes a principled, idealistic stand: the Geneva Conventions forbid forcing captured officers to do manual labor. In other words: Enslave the enlisted men all you want, but if officers have to get sweaty, the laws of war lose all their meaning and civilization collapses.

You see, that’s what it really means to belong to the ruling class: Your position and privilege is so interconnected with the machinery of society that any threat to one is a threat to the other. That’s what’s happening now. It’s unfortunate — but not an emergency — if an economic downturn causes middle-class people lose their jobs and homes, or if nobody can pay for little Susie’s liver transplant. But if Merrill Lynch or Fannie Mae or AIG are about to go bankrupt, on the other hand, civilization is at stake. Money is no object. The government has to step in or there will be cannibalism in the streets by Thursday evening.

It would be sad enough if this were just Wall Street propaganda. But the really sad thing is that it’s very close to being true.

Great Depression 101. To see why it’s nearly true, you need to understand something simple but profound about economics. When people in a primitive economy save, they save some physical thing. Their savings is a pile of grain or firewood or some other good that will be consumed in the future rather than now. But in a modern economy, people save money, and no actual goods are put aside for the future. So, for example, when the workers at an auto plant save, no cars are set aside. Instead, the banking system loans the workers’ money to people who want cars, so that all the cars produced now can be sold now. In a modern economy, production and consumption are always equal — no goods are “saved”.

That happens on a global scale, and the banking system serves as a big match-maker between producers and consumers. When it works, which it does most of the time, it allows production and consumption to match up at a high level. That’s what we mean by prosperity.

But the system is vulnerable to what we used to call a panic (until Herbert Hoover decided that a depression sounded less scary). In a panic, everybody’s net worth is changing so fast that nobody is sure who can be trusted to pay. So banks stop lending, consumers stop consuming, and everybody tries to save at the same time. In a primitive economy, they really could all cut consumption and save at the same time: Grain and firewood would pile up all over until folks realized there was plenty. But the modern economy doesn’t have any capacity to stockpile actual goods, and services can’t be stored at all. So instead, we have to close factories and lay off workers. Businesses go bankrupt and their debts don’t get paid. And that just makes the problem worse. It creates more fear and more uncertainty about who can be trusted to pay.

In a panic, in other words, production and consumption can’t match up at a high level, so they have to match up at a lower level. And that process of moving downward produces more panic. Production keeps dropping in a vain attempt to catch up with dropping consumption.

OK, that’s the Great Depression in a nutshell. Since then, we’ve actually become more dependent on the banking system. Now we have just-in-time production, where goods move freely because businesses all have lines of credit that give their suppliers confidence. What do you think would happen if all those lines of credit suddenly vanished? Well, at every step between the iron mine in Minnesota and your local car lot, each business would have to wait for a check to clear before they delivered the goods. It could work — it used to work — but the transition would be really ugly.

The Bailout Plan. That’s why economists are just about unanimous is saying that the government has to do something when a panic starts in the financial markets. Now we get to what the government should do.

You can think of a panic like a big-city fire: the Chicago fire of 1871 or the London fire of 1666, say. The response has to come on two different time-scales. First you have to put the fire out as fast as you can. And then you need a thoughtful process of rebuilding, where you figure out what went wrong and how it’s not going to happen again.

This is when it would be really nice to have faith in our government. If we trusted that our government was both competent and had our best interests at heart, then we could give it vast temporary authority to put out the fire, trusting that the more thoughtful rebuild-and-reform process would happen later.

The bailout plan that Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke have put together looks just like that. It gives the Treasury Secretary $700 billion to handle as he sees fit. The bill proposed to Congress authorizes him to purchase mortgage-backed securities from any financial institution headquartered in the U.S. at any price he thinks appropriate. It exempts him from any rules about who he can hire or what duties he can contract out. And it says that his actions can’t be reviewed “by any court of law or any administrative agency”.

As I read it, Paulson could hire some relatives to perform unspecified duties, pay them the $700 billion, and close up shop. (Probably he could be tried for malfeasance and sent to jail or something, but I don’t see how we’d get the money back.) Short of that, he could pay exorbitant prices for worthless securities, essentially piping money straight from the taxpayer to Citicorp or Morgan Stanley. And then he could take a high-paying job at Citicorp or Morgan Stanley. It would all be perfectly legal.

And when will we get around to that thoughtful restructuring of the financial system, so that this never happens again? The bill doesn’t say.

I hate to be this cynical, especially when I understand the importance of doing something quickly. But I saw what happened to the Authorization for the Use of Military Force (AUMF) that Congress passed quickly after 9/11. The Bush administration read it as broadly as possible, as an authorization to attack any country, tap any phone, and lock up anyone it cared to designate as an enemy combatant for as long as it thought necessary. And I saw how the administration low-balled the costs of the Iraq War and kept coming back for more money after we were committed.

What the Blogs Are Saying. A lot of people have been writing about the plan. One of the best analyses I’ve seen is by investment banker Yves Smith on a blog called Naked Capitalism. She fleshes out a point that Nouriel Roubini has been making for almost two years: There’s a difference between a liquidity crisis and an insolvency crisis. (Quick summary: If you’re driving a Mercedes and have no cash for the tolls, you’re in a liquidity crisis. But if the balance on your car loan is more than the Mercedes is worth, you’re in an insolvency crisis.) The government can end a liquidity crisis just by guaranteeing loans, so that firms have time to sell off their assets at reasonable prices. But the only way to end an insolvency crisis is for somebody to eat the loss. Is that what the $700 billion is for? Nobody will say.

Paul Krugman makes a similar point. Daily Kos’ New Deal Democrat pulls together a bunch of commentary. The best sound bite is by Senator Bernie Sanders of Vermont: “If a company is too big to fail, it is too big to exist. We need to determine which companies fall in this category and then break them up.”

Politics. The most worrisome question is whether the administration will play politics with this. The plan as written could be a very bad deal for the taxpayer. (I have to say could, because Paulson could also exercise all that power responsibly. Who knows?) We could do better. For example, the government could authorize a detailed audit of the major financial institutions, force them to mark down their mortgage-backed securities to a reasonable value, and then provide capital to bring the firms back to solvency in exchange for stock. If the economy recovers and the institutions prosper, the government could get the taxpayers’ money back by selling the stock, and maybe even make a profit.

But if Congress balks at this bad deal, it risks looking like a dysfunctional institution that can’t take the action we need to save our economy from meltdown. If it puts together a better deal, Bush might threaten a veto and blame Democrats for the impasse. That sounds ridiculous, but it’s exactly what happens every time Congress tries to put conditions on approving more money for the Iraq War.

Down the line, if the Democrats buckle and approve the deal, the Obama administration (insh’allah) could be saddled with a monstrous debt not of its own making. “See,” the Republicans will say when Obama tries to exercise some fiscal responsibility, “I told you Obama would raise taxes.” The payout of hundreds of billions to investment bankers could trigger a fiscal crisis that (Republicans would claim) can only be solved by “entitlement reform” — cuts in Social Security and Medicare.

The public needs to understand that this crisis — just like Reagan’s savings-and-loan disaster —  is the natural result of the conservative philosophy of big business and small government. (Devilstower lays out the history, including the role played by McCain adviser Phil Gramm.) Conservatives have been running against government regulation for decades and arguing that business needs to be free to innovate and be creative. Well, there’s a limit to the virtue of deregulation. We’re in this mess because financial firms innovated and used their creativity, and government stood by and watched.


Arlo Guthrie’s response to the Chrysler bail-out — “I’m Changing My Name to Chrysler“– is relevant again. The same basic idea is at BuyMyShitPile.com. And Nathan Kottke cc’s the NYT on his letter to Secretary Paulson: “My student loans are too big and it is hurting the economy. Can I have a bailout, please? I need $92,000. Thanks.”


17% of Americans still approve of the way President Bush has handled the economy. Who are these people? Are they a danger to themselves or others?


McCain thinks the deregulation of financial markets is a model for how to handle health care:

Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation.

Corporate innovation without government regulation — what could possibly go wrong with that?



This Week in Sarah

Sarah Palin has become like the OJ trial. I complain about how much attention she gets even as I keep watching it. And like every good soap opera, each day brings just enough new information to keep me tuning in. Here’s a summary.

The big news this week was that Todd Palin, under his powers as First Dude, has decided that he can ignore a subpoena from the Alaska legislature. This violates some little-known provision known as “the law”, so the legislature could charge him with contempt ($500 fine and six months in jail). But they don’t come back into session until after the election, so who cares?

Some bloggers have suggested that the legislative council that launched the investigation (unanimously, 14-0, with ten Republican votes) should go ahead and find him in contempt, and argue in court that when the legislature delegated subpoena power it also delegated the power to enforce a subpoena. (I can think of a state trooper who might be willing to make the arrest.) In other words, if the McCain campaign is going to court with novel legal theories to shut down this investigation, why not strike back with novel legal theories to keep it going?


Supposedly Troopergate isn’t about Palin’s ex-brother-in-law at all. But when Sean Hannity brought up the investigation, she started talking about what a bad guy her ex-brother-in-law is. So, this isn’t about him, but it’s justified because he’s a jerk.


As I predicted two weeks ago, there’s a balancing reaction to the evangelicals’ excitement about Palin, and she’s starting to hurt the ticket. Her approval numbers are plunging.


The Anchorage Daily News is annoyed that big-city lawyers from the McCain campaign are running their state government.


She lied about not using the teleprompter at the convention.


She lied about consulting the kids before accepting the nomination.


James Fallows on her interview with Charles Gibson:

What Sarah Palin revealed is that she has not been interested enough in world affairs to become minimally conversant with the issues. Many people in our great land might have difficulty defining the “Bush Doctrine” exactly. But not to recognize the name, as obviously was the case for Palin, indicates not a failure of last-minute cramming but a lack of attention to any foreign-policy discussion whatsoever in the last seven years.


One of the reasons people give for supporting Palin is that “she’s like me”. Salon has a story that points out the fallacy of thinking that because she’s like you, she’ll do good things for you: As mayor of Wasilla, she did a bad job taking care of Lake Lucille, the lake her own home sits next to. So until you see her endorse an actual policy, don’t jump to the conclusion that she’d be good for women or middle-class people or parents of special-needs kids or families with pregnant teen-agers or anybody else.



Short Notes

The Bad Timing Award for 2008 goes to McCain adviser Donald Luskin. A week ago Sunday, the day before Lehman’s bankruptcy knocked over a series of financial dominoes, Lusking had a column “Quit Doling Out that Bad-Economy Line” in the Washington Post.

Things today just aren’t that bad. Sure, there are trouble spots in the economy, as the government takeover of mortgage giants Fannie Mae and Freddie Mac, and jitters about Wall Street firm Lehman Brothers, amply demonstrate. And unemployment figures are up a bit, too. None of this, however, is cause for depression — or exaggerated Depression comparisons.

“Jitters” — I love that.


Boyd Reed wrote a very thoughtful article on race. He begins with an experience from his days as a black high school chess player: His East St. Louis high school team was playing at a high school in a well-to-do white suburb, and when he wandered away from the tournament area (as I used to do at chess tournaments) he was stopped by a white security guard, who marched him to the office and began calling the police. (That never happened to me.)

OK, I’m sure a lot of African-Americans have a story like that, but it’s interesting where Reed goes from there: He thinks about how that one incident shaped his stereotype of whites. And he relates this insight about stereotypes to his experiences canvassing for Obama.

many people are experiencing a fundamental disconnect when they try to process Barack Obama. That disconnect is related to the images they see on the news, in movies, on ESPN, and on the streets where they live.  I think Joe and Jane Six-Pack are suspicious of Obama – despite the fine-tooth comb that’s been taken to his life – because they haven’t ever really *seen* anyone like him.


Some people are starting to see the light. For Elizabeth Drew, author of the glowing 2002 biography Citizen McCain, McCain’s caving in to Bush on torture was the final straw:

This was further evidence that the former free-spirited, supposedly principled, maverick was morphing into just another panderer – to Bush and the Republican Party’s conservative base.

For self-described conservative editor Wick Allison, Obama is “thoughtful, pragmatic, and prudent” while “today it is so-called conservatives who are cemented to political programs when they clearly don’t work.” (His example: tax cuts.) And he is obviously nostalgic for the days when conservatives knew what they were trying to conserve: “It gives me comfort just to think that after eight years of George W.
Bush we will have a president who has actually read the Federalist
Papers.”

Retiring Republican Congressman Wayne Gilchrest agrees.


ShadowSD collects everything you need to know about Obama.


So the Taliban can attack Afghanistan from bases in Pakistan — and if we chase them back there, the Pakistani army will shoot at us.


What kind of a wacko would write this? Oh, right, that was me.

Honesty and Policy

Honesty is not policy. The real honest man is honest from conviction of what is right, not from policy. — Robert E. Lee


In this week’s Sift:

  • Does the Truth Matter? Everyone from liberal bloggers to Karl Rove agrees that McCain is lying. Does the electorate care?
  • The Palin Trap. What if we spend all our time tearing down Sarah Palin and forget to mention that Obama has a health care plan?
  • Short Notes. Another Monday, another financial disaster. McCain’s roommates. Wind power. Voter suppression. The latest from ONN. And Craig Ferguson on voting.


Does the Truth Matter?

Here’s how a normal presidential campaign works: You stretch facts a little, you take your opponent somewhat out of context, and if the media starts to call you on some particular distortion, you back off and find some other facts to stretch. Serious lying is reserved for outside-the-campaign groups, like the Swift Boat Veterans who smeared John Kerry’s war record.

This week the mainstream media started to notice what bloggers (and Brave New Films ) picked up some while ago: McCain has thrown that playbook away. He and Palin tell whopping lies, and if the media calls them on one they just keep repeating it. A lead paragraph in Wednesday’s Washington Post seemed taken aback by this bold trail-breaking into new frontiers of mendacity:

From the moment Alaska Gov. Sarah Palin declared that she had opposed the infamous “Bridge to Nowhere,” critics, the news media and nonpartisan fact checkers have called it a fabrication or, at best, a half-truth. But yesterday in Lebanon, Ohio, and again in Lancaster, Pa., she crossed that bridge again.

The article quotes a Republican strategist:

The more the New York Times and The Washington Post go after Sarah Palin, the better off she is, because there’s a bigger
truth out there and the bigger truths are she’s new, she’s popular in
Alaska and she is an insurgent. As long as those are out there, these little facts don’t really matter.

Which answers exactly what Post columnist E. J. Dionne was asking in that same edition: Does the truth matter any more?:

This is not false naivete: I am genuinely surprised that John McCain
and his campaign keep throwing out false charges and making false
claims without any qualms.

Friday, Associated Press started cataloging McCain lies. (“Even in a political culture accustomed to truth-stretching, McCain’s skirting of facts has stood out this week.”) By Saturday, DailyKos’ Chris Carlson was seeing a widespread John-McCain-is-a-liar meme, quoting articles in the New York Times, Los Angeles Times, Seattle Times, San Francisco Chronicle, and Dallas Morning News. On Sunday, even the Army Times chimed in. And Karl Rove, no less.

What’s striking about this coverage is the directness. Typically, the media turns all disputes — even disputes about checkable facts — into he-said/she-said stories, something like: “Vice President Cheney said today that the sky is green and has always been green. Some Democrats objected, claiming that the sky is often blue.” That’s considered balanced reporting. If a journalist actually went out, looked at the sky, and told us that Cheney is wrong, that would be taking sides. (Because, as Stephen Colbert has pointed out, “Reality has a well-known liberal bias.“) But apparently McCain has crossed some line, and now reporters feel justified in acting like … well, like reporters.

Democrats are also getting more aggressive. In this clip from MSNBC, Ari Melber takes apart a Republican flack. The lie in this case was the McCain ad claiming that Obama had voted for comprehensive sex education in kindergarten, when in fact he supported teaching kindergarteners how to avoid sexual predators. When called on the ad, the Republican retreats to “We don’t know what was in that bill” — which seems to be the McCain standard: It’s not up to us to verify something before we claim it.

When McCain appeared on “The View” Friday, he got a hard grilling from the regulars, including being told by Joy Behar that his ads were “lies”. Undaunted, McCain told a true whopper later in the show. Barbara Walters pushed him to get specific about what “reform” really means, so he started talking about Sarah Palin refusing earmarks. “She also took some earmarks,” Walters observed. “Not as governor she didn’t,” McCain lied.

This is exactly the kind of thing that Dionne had expressed “genuinely surprise” over two days before. It’s checkable, there’s no interpretation about it, and it’s false. As governor, Palin requested earmarks that are indistinguishable from the ones McCain ridicules in his stump speech. McCain likes to talk about a $3 million earmark “to study the DNA of bears in Montana”. Gov. Palin requested a $3.2 million earmark to study the DNA of seals, and half a million to study the mating habits of crabs.

But McCain can look into a camera and with absolute sincerity tell a national audience that this never happened.

Now, in some sense this kind of stuff is trivial. A $3.2 million earmark isn’t what’s wrong with our government. (Earmarks in general are pretty trivial, if you’re talking about trying to balance the budget.) But honesty and integrity aren’t trivial. Paul Krugman connects the dots:

I’m talking … about the relationship between the character
of a campaign and that of the administration that follows. Thus, the deceptive and dishonest 2000 Bush-Cheney campaign provided an all-too-revealing preview of things to come. In fact, my early
suspicion that we were being misled about the threat from Iraq came from the way the political tactics being used to sell the war resembled the tactics that had earlier been used to sell the Bush tax cuts. And now the team that hopes to form the next administration is running a campaign that makes Bush-Cheney 2000 look like something out of a civics class. What does that say about how that team would run the country?

The interesting question is whether any of this will move the polls. Maybe, after eight years of Bush-Cheney, the electorate finds it perfectly normal that political speech is completely manipulative and has no significant informational value. We’ve been told that tax cuts don’t cause deficits, that we’d capture Bin Laden dead or alive, that it didn’t matter whether we captured Bin Laden, that Saddam had weapons of mass destruction, that wiretaps are only done with warrants, that the United States doesn’t torture people, that the Iraqi insurgency was in its last throes, that the Iraqis could finance their own reconstruction, and God knows what else. What kind of fool would expect a president to be bound by the truth?

If that’s the case, then I think the American republic is in real trouble. How meaningful is our vote, if we can’t get any reliable information to vote on? At that point it’s all just American Idol.


Psychologically, I think it’s fascinating the way McCain is re-running the sleazy campaign that Bush ran against him in 2000 in South Carolina: the untraceable negative rumors about Obama, the disregard for truth, and now the slogan-stealing. McCain ran with a reform theme in 2000, and after he won in New Hampshire Bush stole it right out from under him. “Reformer with Results” said the banners behind Bush. It worked. So now McCain is trying to steal “change” from Obama.

I’m reminded of George Wallace, who in the 1950s was fairly liberal for a white Alabama politician. But losing his first gubernatorial campaign to a hardline segregationist transformed him. “I was out-niggered,” Wallace said privately. “I will never be out-niggered again.”



The PalinTrap

The biggest topic of discussion on liberal blogs this week was whether we should be focusing on the various Sarah Palin issues or ignoring them. Looseheadprop on FireDogLake sums up the ignore-her case:

Why do you think they wanted a candidate with Troopergate,
Librariangate, and all the other salacious issues that belong on Jerry Springer? So that we would waste energy and precious time giggling over this stuff instead doing the right thing–specifically tying Bush/Cheney around the neck of each and every GOP candidate, starting with McSame, like the millstone they are and then throwing that GOP candidate overboard to sink under the weight of Bush/Cheney failures.

McCain’s only hope to win, in this analysis, is if people ignore the issues. His strategy relies distraction, on tossing up a whole series of bright, shiny objects that will draw the electorate’s attention away from their worries about the economy, whether they’ll be able to afford health care, whether we’re going to end these wars or start new ones, or anything else that’s important. Palin is the brightest, shiniest object yet. If we talk about her from now until November, McCain wins.

Framing expert Jeffrey Feldman says that McCain’s shift back to the culture wars has given Obama a winning move if he can take advantage of it: the Solve Real Problems frame. Every message — even charges that McCain is lying — should be rooted in a basic message of Obama trying to solve real problems and McCain trying to derail that effort. (A Daily Kossack backs this up with his experience working an Obama phonebank. The undecided voters he talked to like Palin, but are swayed when he talks about Obama’s programs and solutions.)

The focus-on-her bloggers, on the other hand, say McCain relies on mythology triumphing over facts. If McCain and Palin are the Maverick Twins who are going to ride in from the West, clean up this here capital city, and run the varmints out of town — he wins. If that myth were true, maybe he even should win. But it’s false in just about every particular. Over the past eight years McCain has sold out all of his principles to support the Bush administration. (In February he even backed down on torture.) And Palin is the scariest kind of right-wing extremist — vindictive, cruel, proudly ignorant, and willing to use today the tactics that she denounced yesterday. (“George Bush with big hair” says Garrison Keillor.) “Reform” means replacing people she doesn’t like with people she likes — nothing more.

In addition to the practical aspects of tearing down the Palin myth, there’s the pure emotional response liberals have to the pro-Palin double standard. (That’s the real point of the Palin-Hillary SNL skit.) For example, there was a big hoo-hah when Michelle Obama made a comment that could be taken out of context and construed as a lack of patriotism. But it’s no big deal that Todd Palin belonged for years to the Alaskan Independence Party — a party for people who don’t want to be Americans at all. And I recommend not even trying to imagine the right-wing reaction if Chelsea Clinton had gotten pregnant in 1997, when she was 17.

It seems weird to use a celebrity interview as a man-on–the-street reaction, but this Matt Damon clip really captures how scary the prospect of President Palin is to a lot of us: “I need to know if she really thinks dinosaurs were here four thousand years ago. I want to know that, I really do. Because she’s going to have the nuclear codes.” (Sadly, like most celebrity liberals Matt is misinformed about Biblical chronology. Bishop Ussher pinpointed Noah’s Flood — when the dinosaurs became extinct — at 2348 BC, and some young-Earth creationists today think it happened nearly 5,000 years ago. Four thousand years — dinosaurs in 1992 BC — would just be nutty.)

I find myself in the middle. The McCain strategy resembles that of a stage magician: Tell an attractive-but-false story about what you’re doing, while managing the stage effects to take the audience’s eyes off the real sleight-of-hand. The Maverick Myth needs to be blown up, but that point needs to be made quickly, not dwelt on. (Like this: “McCain tried running as a maverick in 2000 and he lost. So for the last eight years he’s been selling out to the Bush administration and the far right wing — because being president is more important to him than having integrity.”) If that point gets challenged, you don’t need a laundry list, you just need one telling example: torture. (“If there was any issue you’d think McCain would stand up for, it would be torture. But he even sold out on that.”) If somebody tries to use Palin as a positive argument, make them bring up specifics. The Obama-campaign argument should just be a flat: “All that stuff about Palin and reform is a fantasy. They made it all up.” Keep all the other stuff in your back pocket in case you need it, but don’t bring it up: troopergate, book-banning, and the rest.

In other words, make the point and move on to talk about Solving Real Problems. Don’t fall into the trap of talking endlessly about Palin and not at all about Bush and Cheney. And don’t kid yourself that there’s still plenty of time. The Republicans have a blizzard of false negative ads about Tony Rezko and Bill Ayers waiting to run in October. Anything we haven’t brought up by then will get drowned out.


OK, I can’t resist continuing to talk about Palin long enough to link this clip made from her Gibson interview, where she sounds like a C-student taking an oral exam.


This Obama ad is a pretty good attack: McCain is lying to distract us from his connections to Bush. But it needs to be a one-two punch with this ad of Obama talking straight to the camera about what he wants to do.


Colbert King gives us a quick lesson on racism and classism by comparing Bristol Palin’s pregnancy with the letters he got after writing a column on teen pregnancy in inner-city Washington. The public reacts very differently to a middle-class white pregnant teen-ager than to a poor black pregnant teen-ager.



Short Notes

One disadvantage of writing on Mondays is that so many big financial deals get worked out over the weekend that it’s hard to figure out what to make of them Monday morning. This morning, Lehman Brothers declared backruptcy after failing to find anyone to buy what was one of Wall Street’s big names not too long ago. Merrill Lynch, apparently in bad shape but not quite so bad as Lehman, sold itself to Bank of America. Insurance giant AIG (which had already lost $14 billion in the first half of 2008) is trying to get a $40 billion loan from the Fed. If they don’t get it, they might go bust too. The Dow dropped 300 points in response.

What makes all this so worrisome is that cacading bankruptcies are precisely what precipitate depressions. Last week the value of Fannie Mae and Freddy Mac preferred stock — once considered quite safe — cratered. That may have had something to do with destabilizing Lehman and Merrill. And now you have to wonder whether there are firms whose balance sheets looked fine Friday, but now they have to look at the money Lehman or AIG owed them and wonder how much of that they’ll ever see again. Maybe that makes them insolvent too. Or maybe it just makes their customers worry about insolvency and start moving their money somewhere that looks safer, and that pushes the firms into insolvency.

Nobody knows where it’s going to stop. In case you’re wondering whether to sell everything you own and hide the cash in your mattress, the FDIC insures bank accounts up to $100,000 and the SIPC protects brokerage accounts up to $500,000 (protects them against the bankruptcy of the the brokerage, not against trading losses).


The best short online political video I’ve seen in a while is a two-part (so far) series called “McCain’s Roommates”. The premise is two ordinary guys who share an apartment with John McCain. McCain is always off-screen, all his lines are taken from the audio of his public appearances, and the roommate problems parallel what’s going on in the campaign. In the first episode, the roommates are trying to complain to McCain about the mess he left on the kitchen table, but he responds to every criticism by talking about his POW experience. In the second episode, the roommates are trying to talk McCain out of inviting Sarah Palin to move in with them. “We’re worried about you as a friend, man. You’re rushing into this. You don’t know anything about this girl.”


The Onion News Network has a great piece — it’s from the primary campaign, but it’s still relevant — “Candidates Compete for the Vital Idjit Vote.” And they analyze the possibility that an even older, more curmudgeonly candidate might steal votes from McCain. They also profile the No-Values Voters, who are looking for an evil candidate they can support. “The tenor of the political debate right now seems focused on helping people and making positive change, and that’s very alienating for people like us.” And in sports news, ONN reports that the Jacksonville Jaguars forfeited a football game when “the pre-game coin toss caused the Jags to realize the randomness of life and the triviality of their own existence.”


The challenge of wind power is that while you can build a coal-fired power plant anywhere you want and burn the coal whenever you need the electricity, you have to put a wind farm where the wind blows and you can’t control how much power you’ll get from one hour to the next. So you either have to be able to move the power to where it’s needed or to store it somehow.

This article is about the limitations of the current electrical grid, which can’t move large quantities of power even from upstate New York to New York City. This one is about off-shore wind farms, which seem to make a lot of sense in the Northeast. They’re more expensive to build than land-based wind farms, but the wind is steadier offshore, and you get power a few miles off the East coast rather than in the middle of North Dakota. So the windmills are more expensive but the grid improvements are cheaper.


The dirty tricks to suppress voter turnout begin.


Did you hear that Venezuela and Boliva expelled their U.S. ambassadors? Me neither. You’d think somebody might have mentioned it to us.


You have to love Craig Ferguson‘s view of his adopted country’s democratic process. Voting’s not exciting or cool; it’s a pain in the butt. But “if you don’t vote, you’re a moron.” This is actually a fairly old idea. The word idiot comes from the same Greek root as idiosyncrasy. The original idiot was somebody who cared only about his own affairs and not at all about the community. The whole routine in the link is fabulous.

Scrounging for Change

They always say time changes things, but you actually have to change them yourself. — Andy Warhol

In this week’s Sift:

  • What is Change? Over the next few weeks, I’m going to do my small bit to shift the focus back to issues. This week I compare the Obama and McCain proposals for taxes and health care. Or at least I let the Tax Policy Center do it for me.
  • Palin and the Other Republican Base. All week, journalists have been interviewing Republican voters coming out of Evangelical churches, as if there was some doubt that working-class Evangelicals would rally behind Sarah Palin after her daughter’s pregnancy. But what about the old-guard Republican establishment, the suburban professionals? I bet they’re not nearly so happy.
  • Short Notes. Fannie and Freddie get a bailout. Jobs increase faster under Democrats. What are these “small town values” Rudy Giuliani was talking about? And how not to respond to political attacks.


What is Change?

It’s official: Both candidates — including the one who has voted with President Bush 90% of the time — are running on change.

In his acceptance speech Thursday, John McCain said change ten times, including: “Change is coming. … We need to change the way government does almost everything. … We have to change the way we do business in Washington.” By contrast, the word Bush was hardly ever heard at the Republican Convention. McCain said Bush exactly once (“Laura Bush”). Otherwise it was like listening to orthodox Jews avoid saying the name of God. McCain once obliquely thanked “the president of the United States” (whoever he might be) and “the 41st president” (who shares the unmentionable name). Even the word Republican was hard to find at the Republican Convention. McCain said it three times: twice as part of a nonpartisan list (“Republicans, Democrats, and independents” and “Democrats or Republicans”), and once in a distancing way (“some Republicans gave in to the temptations of corruption”).

So everybody is for change now, and is running against (or at least not with) the Republican Party and President He-Who-Must-Not-Be-Named. But what kind of change? Are we talking America 2.0? Or something more like New Coke?

Over the next few weeks I’m going to resist the temptation to lose myself completely in the day-to-day campaign trivia. Instead I plan to take an issue or two each week, look at what McCain and Obama propose to do with it, and try to find some independent analysis about the likely results. This week I look at taxes and health care, which I’m putting together because there’s one excellent document that covers both: “An Updated Analysis of the 2008 Presidential Candidates’ Tax Plans” by the Tax Policy Center.

If you want the one-paragraph summary, here it is: McCain cuts taxes mainly for rich people, Obama mainly for non-rich people. (EconomistMom asks the obvious question: “If McCain’s tax cuts will create jobs, why haven’t Bush’s?”) McCain’s health plan is about 20% less expensive than Obama’s, but does almost nothing to reduce the number of people without health insurance. Obama’s plan cuts that number in half, but it’s still not universal care.

Taxes. Let’s start with the conclusion, from page 37:

If enacted, the Obama and McCain tax plans would have radically different effects on the distribution of tax burdens in the United States. The Obama tax plan would make the tax system significantly more progressive by providing large tax breaks to those at the bottom of the income scale and raising taxes significantly on upper-income earners. The McCain tax plan would make the tax system more regressive, even compared with a system in which the 2001–06 tax cuts are made permanent. It would do so by providing relatively little tax relief to those at the bottom of the income scale while providing huge tax cuts to households at the very top of the income distribution.

If you’re a visual thinker, see the bar graphs on pages 38 and 39.

The specific changes each candidate supports are in one big indigestible paragraph on page 1, and again in a huge table on page 6. Here’s the gist:

  • Expiring tax cuts. Most of the 2001 and 2003 tax cuts are set to expire after 2010. McCain, like He-Who-Must-Not-Be-Named, wants to make them permanent. Obama wants to make permanent almost all the cuts for people making less than $250,000 a year, and repeal the other cuts right away.
  • Estate tax. If your estate is going to be less than $3.5 million, neither candidate will tax you. McCain taxes estates above $5 million at a 15% rate. Obama taxes above $3.5 million at a 45% rate. Prospective heirs of dying billionaires should definitely vote for McCain.
  • Alternate Minimum Tax. The AMT was originally created in 1969 to make sure rich people paid a little tax, no matter how many shelters and deductions they had. But inflation has pushed a bunch of upper-middle-class people into the AMT’s range, and millions more have to file a complicated form just to prove they don’t owe any AMT. Congress can’t agree on a permanent solution, so every year it passes a “patch” to mitigate the problem. Both candidates propose to make the 2007 patch permanent and index it for inflation so that subsequent patches won’t be necessary. McCain’s plan makes additional cuts in the AMT. (In his stump speech he talks about eliminating it, but that seems to be an overstatement.)
  • Other. Both candidate have a list of targeted cuts. Obama wants to eliminate income tax for seniors making less than $50,000. McCain increases the exemption for children, and lowers the corporate tax rate from 35% to 25%. Both propose to eliminate various corporate tax loopholes. Obama wants to raise tax rates on dividends and capital gains, but not to the Clinton-era levels.

Without spending cuts (which both candidates promise but neither has specified) both plans increase the deficit: Obama by $3.4 trillion and McCain by $5.0 trillion over ten years.

Health care. Obama’s plan does a number of things: It mandates that parents find health insurance for their children. It subsidizes health insurance for people of lower incomes, by expanding Medicaid and SCHIP programs for the very poor and by giving direct subsidies to lower-income families who don’t qualify for Medicaid but don’t have employer-sponsored insurance. It requires more employers to offer health insurance, and it guarantees that everyone will be able to get insurance for no worse than 110% of the average employer-offered premium.

Unlike Hillary Clinton’s plan (or Mitt Romney’s in Massachusetts) Obama’s plan doesn’t require adults to have insurance. This is probably a mistake, because no matter how much you subsidize it, a lot of people will assume they’re invulnerable and try to save some money. So although the number of uninsured will go down significantly, hospitals still won’t be able to assume that everyone is covered. But at least everyone who doesn’t think he’s Superman will be able to afford coverage.

McCain’s plan mostly does two things: It shifts the tax credit for health insurance premiums from employers to individuals, and it allows insurance companies to compete across state lines. The main effect is to increase shopping: Healthy people will shop for the least expensive insurance plan, and insurance companies will shop for a low-regulation state to locate in.

Some workers, especially young and healthy ones who can find inexpensive insurance in the nongroup market, would decide that [employer sponsored insurance] was no longer their best option and would refuse their employer’s offer of insurance (and expect higher wages). Some employers, finding that their average premiums increase as the healthy employees opt out, would decide to stop offering coverage.

This is typical Republican YOYO (you’re on your own) philosophy. Group coverage will likely unravel, leaving high-risk people (like my wife, a cancer survivor) dependent on some kind of government-supported “high-risk pool”. McCain offers no details about how these pools would work or what they would cost either individuals or the government.

McCain’s tax credit is a little more generous (for most people) than the current one, and it applies to everybody (rather than just people who get health insurance through their employers). So it’s a net increase in the government subsidy for health care, and the result is a small decrease in the number of uninsured people.

Obama’s plan is more expensive, but not a lot more. ($1.6 trillion vs. $1.3 trillion over the first ten years.) And the effect on the number of uninsured is much larger. By 2018, the report estimates that 66.8 million people would be uninsured under the current system. McCain’s plan would lower that to 64.8 million and Obama’s plan to 32.9 million. Again, a graph can help you picture what’s going on.



Palin and the Other Republican Base

Let me start with a digression, and tell you how my magazine-writing career started. By coincidence, I read George Lakoff’s Moral Politics and James Ault’s Spirit and Flesh one right after the other. And it dawned on me that Ault’s long-term study of an upstart working-class Evangelical church provided the nitty-gritty detail that Lakoff’s strict-father/nurturant-parent archetypes lacked. So I wrote an article I called Red Family, Blue Family and put it on my web site. A magazine editor noticed it, and convinced me to cut it up into articles here and here. My continuing fascination with the overlap of religion, politics, class, and worldview led to a later article here.

Now let me tell you what that has to do with Sarah Palin. The pundits — almost none of whom are working-class Evangelicals themselves — cluelessly expected that such people would turn on Palin when her unmarried 17-year-old daught Bristol turned out to be pregnant. So we’ve been treated to a week’s worth of cameras pointing in the wrong direction, at Evangelicals who (predictably) are more enthusiastic about her than ever. It’s a dog-bites-man story — they always seem like a big deal to people who have never seen a dog before.

The interesting story, which I hope somebody starts covering soon, is what the other side of the Republican base is thinking. I’m talking about the suburban professionals: the corporate middle managers, medium-sized business owners, engineers, doctors, accountants, and Chamber of Commerce types who made up the core of Gerald Ford’s Republican Party. I’m willing to bet that they’re sitting in front of their TVs being quietly horrified. I doubt they’re making any snap decisions, so this effect won’t show up in the polls in the next week or two, but they’ve got to be having some serious doubts.

Here’s why: One of the biggest differences between these two chunks of the Republican base — working-class Evangelicals and non-Evangelical suburban professionals — has to do with the value of personal planning and control. It’s already a big difference between the working class and the professional class, before religion and politics get into the picture. Professionals value control. When you interview with a Fortune 500 company, they’re bound to ask: “Where do you expect to be in five years?” But when the car wash hires you, they don’t ask that. You can explain this two ways: (1) Working-class people don’t have the options professionals do, so they have to react to life more than plan for it. Or (2) professionals are more successful precisely because they don’t get knocked off stride. They make a plan — college and an MBA, say — and carry it out, while people with a shorter-term view of life are more likely to wind up waiting tables or driving trucks.

When you throw Evangelical religion into the working-class mindset, you get a Christian version of fatalism: Sure, you had plan, but God had a different plan, and you just have to roll with it. Try to see things from God’s point of view and look for the blessing-in-disguise.

But to a professional-class Episcopalian or Catholic or Jew, that’s a rationalization for losers. Their God is no fairy godmother, so if Cinderella wants to go to the ball she’s going to have to make a plan and stick to it — no matter what random obstacles get thrown in her way.

Now look at how the Palins have spun Bristol’s situation: Blessing in disguise. The pregnancy wasn’t what they would have chosen for their daughter, but it’s OK because everybody’s going to do the right thing. Bristol’s keeping the baby and her teen-age boyfriend is going to marry her. So Sarah and Todd get to be grandparents even sooner than they had hoped.

It’s no wonder working-class Evangelicals are eating this up. Sarah Palin gracefully rolls with the unexpected blow, and quickly gets herself lined up again with God’s plan. And the story has a happy ending: a wedding, a baby, and a handsome young couple with a beautiful child — just like Mary, Joseph, and the baby Jesus.

But to professional-class Republicans this doesn’t sound like a happy ending at all. Professional-class parents start picking out their baby’s college while the kid is still in the uterus. (I heard this joke: Asked how old her children are, the mother says, “The doctor is five and the lawyer is seven.”) Parents coach their kids from childhood about how things will look on their application to Harvard or Stanford. The idea that all that planning might get tossed aside so that their 17-year-old daughter can marry the 18-year-old who knocked her up, and the two of them can raise their accidental child — it’s a nightmare, not a fantasy. If that’s what the girl wants to do, her parents will try too talk her out of it. Because in the professional class, a surprise pregnancy isn’t a gift of God or even an act of God; it’s poor planning. It’s a sign — if you needed another sign — that the couple is not ready for marriage.

As the professional-class worldview tells the story, it doesn’t have an ending at all yet. Professional-class folks believe in statistics, so they know that (the Holy Spirit notwithstanding) teen marriages don’t work. Teen shotgun marriages work even less well. So the wedding is just another scene in the ongoing tragedy, not a happily-ever-after moment. Most likely the young couple has another kid or two and then gets divorced. (This is exactly what happened to the pastor’s daughter in Spirit and Flesh.) Then the girl is 21 and has kids, but no husband and no education. That’s an even bigger disaster than being 17 and pregnant, and it’s a disaster not just for your daughter, but for your grandchildren too.

So I’m waiting for reporters to realize that they should interview some Republicans coming out of Nordstroms or visiting their children at Yale. You know who’s mind I’d really like to read right now? Barbara Bush. No way she’d have let a teen-age W or Jeb marry some girl just because she got pregnant. That’s not how dynasties are built.


Yeah, I know: There are professional-class Evangelicals. I’m guessing most of them don’t know which way to turn on this.


It was illuminating to watch the conservative talking heads instantly reverse all their previous rhetoric when Palin was selected. As so often happens, nobody captured the sheer hypocrisy better than The Daily Show. Unless it was that open mic at MSNBC that continued recording Republican flacks Peggy Noonan and Michael Murphy after Chuck Todd cut away for commercial. Both said glowing things about Palin in public, but when they think the mic is off Noonan describes Palin’s selection as “political bullshit” and Murphy says it was “cynical”.

Matthew Yglesias comments: “In a sane world, one wouldn’t put talking heads on TV to express their opinions unless they were going to express their genuine opinions.” Me, back in April: “In theory, it would be possible to assemble a team of pundits of a variety of political philosophies, but still have them work for you. Their statements would be colored by their philosophies (the same way mine are), but they would say only what they truly thought, and not what their side’s strategy wanted you to believe. In practice, I don’t see this happening anywhere.”


Republicans have tried to make an issue of Democrats’ anti-Palin “sexism”, but actually the harshest comments have come from Republicans. Ben Stein said “She should have Henry Kissinger baby-sitting her.” Dr. Laura: “But really, what kind of role model is a woman whose fifth child was recently born with a serious issue, Down Syndrome, and then goes back to the job of Governor within days of the birth?” And then there’s this pre-Palin-announcement conversation between Joe Scarborough and Pat Buchanan.


Finally, a lot of questions about Palin really do need answers. Kagro X on Daily Kos explains why Troopergate is so important: Start with someone who abuses her power as governor to advance a personal vendetta, and now drop her into the unaccountable “fourth branch of government” that Cheney has created in the vice presidency. It’s a recipe for disaster. Plus, the McCain campaign has started using all the Bush-Cheney tactics to stall or derail the Alaska legislature’s investigation. These are the people who are going to clean up Washington?



Short Notes

So now the government is taking over Fannie Mae and Freddy Mac. Here’s the best analysis I’ve seen so far. The upshot: We depend on the Chinese to keep financing our borrowing, and they were getting nervous. Matt Yglesias expresses my own worries about the bailout plan:

Under the circumstances, one is inclined to suspect that obscure-but-consequential provisions of a complicated-and-important arrangement will be slanted toward the interests of the powerful and well-connected (i.e., those in a position to really monitor what’s happening) rather than you or I.


Three lines: job growth under Clinton, job growth under Bush, and population growth. Under Clinton jobs grow faster than the population, under Bush much less so. David Fiderer sums up the lesson of the last 75 years: “Rapid job growth only occurs when there’s a Democrat in the White House.” A former vice chair of the Fed agrees.


The Daily Show asks the just-plain-folks at the Republican Convention to define “small town values”.


The voter registration numbers look good.


You know what the dumbest thing Nixon ever said was? “I am not a crook.” Because of way human brains work, that statement fused the words Nixon and crook for anybody who lived through that era. Here’s advice on how not to repeat that mistake by saying things like “Obama is not a Muslim.”


You know all that talk about crumbling infrastructure? Never mind. Couldn’t be that serious.

Conventional Thoughts

This time, like all times, is a very good one, if we but know what to do with it. – Ralph Waldo Emerson

In this week’s sift:



Democrats: the Convention

The speeches are all on the convention web site, including the ones that the network talking heads ignored. (I had to download a plug-in to watch the video, but it was painless.) A bunch of them are also on YouTube. So don’t take my word for what happened. Watch it yourself, if you haven’t already.

The Democratic Convention had three questions to answer:

  • Would the party come out of the convention united?
  • Could they present a compelling case for electing Obama over McCain?
  • Would Obama get a convention bounce in the polls?

Party Unity. This question was way over-hyped by the networks, who again and again searched out the most distressed Clinton supporters, without making any effort to quantify how few people they represented.

Yes, Hillary Clinton aroused exceptionally strong loyalties, particularly among women of her own generation. But it’s not like 1968, when Gene McCarthy’s people didn’t trust Hubert Humphrey to end the war. Every issue Hillary stands for — equal pay, choice, health care, getting out of Iraq, looking out for working people, preserving Social Security — will do better under an Obama administration than a McCain administration. The vast majority of Clinton supporters understand that, and they’re not going to stay home or vote for McCain out of spite.

In the end, though, the Democrats made lemonade out of this lemon. The ginned-up conflict got people to watch, and the convention made a good case for Obama. As an Obama supporter, I wanted a huge rating for Hillary’s speech, and also for Bill’s. They’re good speakers, good Democrats, and sensible professional politicians. The idea that they might sabotage Obama made compelling TV, but not much sense.

Making the Case. Obama’s speech (video, text) was just right — not a soaring piece of oratory for scholars to praise decades hence, but an effective presentation of his case here and now. And more than 40 million people watched — double John Kerry’s audience in 2004, and more than the Oscars or any night of the Beijing Olympics. (God apparently rejected Focus on the Family’s prayers for rain. We can only hope he’ll reject the parody prayer request of johnfromberkeley as well. Of course, I can’t help noticing that a storm of Biblical proportions is disrupting the Republican convention. Is God displeased?)

Obama gave a positive statement of his own policies — fleshing out what “change” means. (I’ll focus on this next week.) And he framed the attack on McCain in ways that I think will resonate through the fall.

Best lines: “America, we are better than these last eight years. We are a better country than this.”

“The record’s clear: John McCain has voted with George Bush 90 percent of the time. Senator McCain likes to talk about judgment, but, really, what does it say about your judgment when you think George Bush has been right more than 90 percent of the time? I don’t know about you, but I am not ready to take a 10 percent chance on change.”

“For over two decades, he’s subscribed to that old, discredited Republican philosophy: Give more and more to those with the most, and hope that prosperity trickles down to everyone else. In Washington, they call this the ‘Ownership Society,’ but what it really means is that you’re on your own. Out of work? Tough luck, you’re on your own. No health care? The market will fix it. You’re on your own. Born into poverty? Pull yourself up by your own bootstraps, even if you don’t have boots. You are on your own. Well, it’s time for them to own their failure. It’s time for us to change America.”

The Bounce. There was a bounce, but not a game-changing one. 538 still rates the election as extremely close.



Republicans: The Palin Pick

McCain’s VP pick was always going to be more significant than Obama’s. Not just because he’s 72, but because there have been two John McCains. His VP would indicate which one is real.

McCain-2000 often sounded like a reasonable moderate post-partisan. He seemed to understand the liberal point of view even when he didn’t agree with it, and the divisive social issues didn’t interest him much. McCain-2008 has been a dogmatic conservative, and has kowtowed to all three of the GOP’s power bases — theocrats, plutocrats, and neocons. McCain-2008 is strongly anti-abortion and anti-gay-rights, he wants more tax cuts for the rich, and he has promised more wars. Only on one or two issues — global warming, for example — does the pragmatic, results-based, evidence-considering McCain-2000 seem like he might be peeking out.

They can’t both be real, so was McCain-2000 an act that he put on to appeal to Independents? Or is McCain-2008 an act to win the Republican nomination that escaped him in 2000? Picking Romney would have kept the guessing game going, because he also has two masks — the moderate one he wore when he ran for governor of Massachusetts and the right-of-Reagan one he put on for his presidential run. Lieberman was a neocon favorite, but would have been a big screw-you to the theocrats because of his pro-choice record. If McCain-2000 was still in there somewhere, he’d probably go for Lieberman. (Pawlenty, the other name frequently mentioned, was the safe pick, and would have meant that McCain thought he was winning. By contrast, choosing a wild card like Palin says that he believes he’s losing. That’s why Charles Krauthammer and Dan Gerstein aren’t happy.)

Choosing Sarah Palin says that McCain-2008 is in charge. Palin has one of the most extreme anti-abortion positions possible — no exceptions for rape or incest. Even the threat of a debilitating injury isn’t sufficient. The only excuse for an abortion is if “the mother’s life would end if the pregnancy continued.” (On page 188 of The Political Brain, Drew Westen recommends framing the no-rape-exception as “guaranteeing every rapist the right to choose the mother of his child.”) She doesn’t believe that global warming has man-made causes, to the point of suing to prevent polar bears from being classified as an endangered species.

Conclusion: McCain is serious when he says he’s against abortion, but he’s not serious when he says he’s against global warming.

The Female Factor. Everybody’s first thought was that Palin was a play for the disgruntled Hillary voters. I doubt this, because I don’t think McCain’s that dumb. Or else he thinks Obama is even dumber.

The right comparison here is Clarence Thomas in 1991. Thurgood Marshall, the legendary lawyer who won the Brown v. Board of Education case in 1954, had just retired, making the Supreme Court all-white again. President Bush the First was feeling pressure to replace him with another African-American, so he responded with what was essentially a parody of affirmative action: If there’s a one-seat black quota on the Court, and if no other qualification matters, then why not Clarence Thomas?

According to a study by The Newspaper Research Journal, Thomas’ initial support was lower among blacks than among whites. But it grew after the Anita Hill attacks.

the lines were not so much between black liberals and black conservatives but between the seemingly condescending whites in the U.S. Senate and the nation’s African Americans. This allowed the black press to paint the heretofore different issues as not liberal versus black but as black versus white–with the U.S. Senate as the chief villain.

Expect the same pattern here. If the Obama campaign is stupid enough to attack Palin in a misogynistic way, then women will rally around her. But if not, then Clinton’s female supporters are going to feel insulted by this pick, just as blacks were insulted by the idea that Thomas could replace Thurgood Marshall. Former Clinton supporter and Florida Congresswoman Debbie Wasserman Schultz had the exactly right response: “I know Hillary Clinton, and Sarah Palin is no Hillary Clinton.” Women Hillary’s age are bound to see this as yet another case where a powerful man promotes a young, pretty woman over the heads of older women who have paid their dues, like Senators Kay Bailey Hutchison or Susan Collins. Early polls bear this out.

Attacking Obama. It wasn’t until I watched the video of the Palin introduction rally in Dayton that I started to get what McCain was thinking. McCain has been pushing three themes against Obama. The first is the scurrilous, lie-based one that stays just under the radar: Obama isn’t like you. He’s black, he might be Muslim, he’s not patriotic, and he’s not really even an American. The second is the inexperience theme: Obama isn’t ready. And the third looks like the first, but is actually different: Obama is an elitist. (See below.)

By picking Palin, McCain is giving up on the inexperience theme. That’s smart, because it wasn’t going to work much longer anyway. You see, experience is really a quick substitute for two other questions: “Does he know his stuff?” and “How does he handle himself under pressure?” A thin resume makes you grill somebody harder in the interview, but if he keeps his composure and proves that he knows his stuff, the problem goes away. In order to make the inexperience theme stick, McCain would have to demonstrate in the debates that he has a deeper, richer grasp of the country’s challenges than Obama does. Or that he can make Obama lose his cool under the harsh lights. That was never going to happen, because actually it is McCain who is more superficial and more likely to get rattled.

But Palin is great for the other two themes. In the rollout rally, she was Mrs. Middle America. She’s good looking without being too good looking. She’s a Mom. She fishes and shoots a gun. Her husband belongs to a union. She’s not the kind of Christian who hates gays and other sinners, but the kind who honestly feels bad that they’re going to burn in Hell. (I’m extrapolating. She didn’t say that; she just reminds me of people who do.) Her son is on his way to Iraq — deploying on September 11, no less. She didn’t have an abortion even after she found out that her fetus had Downs Syndrome.

In other words, Palin says to a lot of people: I’m like you. Or I’m like you would be if you had the energy and luck and determination to be what you really can be. She makes Michelle look so … black. Both Obamas look very Ivy League compared to her journalism degree from Idaho. By picking her, McCain is expressing his faith that all you really need is a good heart, not some kind of expertise that ordinary people will never have. If something happens to John, God forbid, we can count on Sarah to make the right choices in Iraq because she’s got a son there. It doesn’t matter whether she knows who’s Sunni or Shia, or the history of what the British or the Ottomans did there, or even the difference between Kurds and whey. Her heart is in the right place. She’ll do fine.

This is nutty, I hope you realize. If we should have learned anything from the last eight years, it’s that you really do want your leaders to know things and understand things. Think Katrina, Iraq reconstruction, Monica Goodling’s Justice Department. Expertise matters.

How to Attack McCain/Palin. Obama and Biden are going to have to handle Palin very carefully. Because even though there’s no evidence that Palin has expertise in anything, she might. You can never tell just by checking a resume. Ideally she will look like an amateur all on her own, without any Democrat’s help.

That’s starting to happen. She apparently thinks the founding fathers wrote the Pledge of Allegiance, and that “under God” was in it. She admits that the Iraq War is about oil. What she and McCain are claiming about her opposition to the Bridge to Nowhere doesn’t stand up. And she’s already in the middle of a scandal.

The other appropriate tactic is not to attack Palin, but to attack McCain’s judgment in choosing her. (You’d think he might have investigated enough to find out that Palin’s unmarried 17-year-old daughter is pregnant. Don’t attack Palin or the daughter — but why didn’t McCain know?) What other bizarre, unvetted appointments might we expect in a McCain administration? This theme connects Palin with stories like Phil Gramm’s statement in July that we’re “a nation of whiners” because we’re not happy with the economy. And there’s a new example that’s even better: According to Wednesday’s Dallas Morning News, McCain health-care advisor John Goodman thinks that access to an emergency room is enough health insurance for Americans:

So I have a solution. And it will cost not one thin dime. The next president of the United States should sign an executive order requiring the Census Bureau to cease and desist from describing any American — even illegal aliens — as uninsured. Instead, the bureau should categorize people according to the likely source of payment should they need care. So, there you have it. Voila! Problem solved.

Paul Krugman elaborates. Palin, Gramm, and Goodman are examples of bad judgment, of a candidate who surrounds himself with people you either shouldn’t trust or can’t count on to know what to do.



Who’s an Elitist?

On the surface, the charge seems so ridiculous that the Onion News Network made a joke out of it: A grey-haired black college professor says, “In the past blacks were seen as ignorant or dangerous. That today a black man is seen as too good for people is a huge step forward.”

Gore, Kerry, and now Obama have all been portrayed as elitists. A true patrician like George W. Bush was not, and neither is John McCain, who is the son and grandson of admirals, and married an heiress with gobs more money than the Obamas. What’s up with that?

Why the elitist charge sticks is only a mystery if you interpret it in a literal sociological way, and don’t realize that it’s code for something else entirely. Let me illustrate with a story. One morning when I was in graduate school, I was on an elevator with a workman who was coming in to do some maintenance on the building. He unwrapped a Butterfinger, and then he looked at me and said: “I bet you don’t approve of eating a candy bar for breakfast.” At that point in my life I was undoubtedly making less money than he was, my diet was nothing to brag about, and I hadn’t been paying any attention to him or his candy bar. But still, to him I represented all the people who think they know how he’s supposed to be living his life.

In politics, that’s who the elitists are — the people who make you think bad thoughts about yourself, the people who might have some reason to think they know better than you.

They’re not the billionaires or the social-register types. The person who really makes you feel inferior is the sister or cousin or childhood friend who came from the same trailer park you did, but now she has her masters degree, a nice husband, a house in the suburbs, and beautiful children. She doesn’t smoke or drink much and she always looks like a million bucks — and if that bitch ever starts telling you how to live or what to do or how to raise your kids, you’re really going to let her have it. The elitist is the guy whose accent changed after he went to Princeton. He actually understands all this stuff they talk about in the newspapers, to the point that you’re afraid to talk to him about any of it, because he might just say, “What do you know? You should just shut up.” Or even if he didn’t say that, you’d know he was thinking it.

That’s how Obama is an elitist, even moreso than Gore or Kerry. He’s a smart, well-informed guy who really could look down his nose at you, if he were so inclined. On all sorts of issues, Obama would have every right to say: “You don’t know what you’re talking about.”

You can almost picture him saying it. That bastard. Who does he think he is?



Short Notes

Electric cars. They’re energy efficient if they’re done right.


DailyKos has a totally cool election-map tool. If you want to try out all the “What if McCain takes Florida and Obama gets Ohio?” scenarios, this is the place to do it.


After swearing up and down that all the problems with Premier (old name: Diebold) voting machines were either non-existent or due to human error, the company finally admits the programming error that’s been there all along.


The Onion News Network coaches you on how to pretend you care about the election. And if you’re looking for a party that really responds to your concerns, check out the Republicrats.


Hullabaloo’s dday reports on the police-state tactics Republicans are using to keep down the protests in Minneapolis. Apparently it takes nine police cars to pull over one school bus of protestors. Glenn Greenwald:

Just review what happened yesterday and today. Homes of college-aid protesters were raided by rifle-wielding police forces. Journalists were forcibly detained at gun point. Lawyers on the scene to represent the detainees were handcuffed. Computers, laptops, journals, diaries, and political pamphlets were seized from people’s homes. And all of this occurred against U.S. citizens, without a single act of violence having taken place, and nothing more serious than traffic blockage even alleged by authorities to have been planned.