Category Archives: Political Commentary

Business, Economics, Media Criticism, Political Commentary

Regulatory Overreach

6 Comments

Why we shouldn’t allow the federal government to accumulate any more power over the financial industry (and why in fact it already has too much):

… the case for broadening regulators’ oversight to include investment banks and other financial institutions is based on three flawed assumptions.

The first is that the same factors that justify expansive powers to close banks and take control of their assets are equally applicable to investment banks and other financial institutions. But the FDIC’s interest in commercial banks is unique — because it guarantees deposits up to $250,000, the FDIC is a bank’s most important creditor and has a stake in its health as the representative of American taxpayers. The government’s stake and the need to assure that depositors do not lose access to their deposits, even temporarily, arguably justify the FDIC’s extraordinary powers. Those factors are not present with investment banks or other financial institutions.

The second flawed assumption is that our bankruptcy laws are not adequate for handling defaults by investment banks or other financial institutions. …

Contrary to the widespread myth that bankruptcy is time-consuming and ineffectual, Lehman sold its major brokerage assets to Barclays less than a week after filing for bankruptcy. It is now in the process of selling its tens of billions of dollars of less time-sensitive assets at a more deliberate pace. …

The third flawed assumption is that financial firms flirting with distress are somehow worse decision makers than federal regulators. But the opposite is likely true. If the Treasury, FDIC and Fed had authority over investment bank failures, troubled banks would have a strong incentive to negotiate for rescue loans, and their pleas would be heard by regulators influenced as much by political as financial factors. The involvement of three different regulators (and mandatory consultation with the president) would magnify this risk. With bankruptcy, in contrast, the decision of whether and when to file is made by an institution’s managers and creditors, who have the best information and their own money on the line.

[Via Professor Bainbridge], who has more thoughts.

Much of the risk taking occurring in these institutions was caused by the moral hazard of knowing (or at least being willing to bet) that the government would step in and bail them out. Particularly since many in the government were on their payroll, either through campaign contributions, sweetheart mortgage deals, or simply the incestuous revolving door between the federal bureaucracy and the institutions. Fannie Mae and Freddie Mac both seem to have been a cushy retirement home for former Democrat operatives (e.g., Franklin Raines).

And in the “gee, ya think?” category — “Dodd’s Troubles Open Debate On Congress’ Ties With Special Interests“:

Dodd has become the poster boy for critics who say the inevitable ties between long-time members of Congress and special interests are undermining efforts to revive the economy.

“He literally thinks he’s going to play a critical role from saving us from ourselves,” Christopher Healy, the Republican Party chairman in Connecticut, said of the Democratic senator.

“It’s like putting the arsonist in charge of the volunteer fire department. He knows where the fire is because he set it. But beyond that, he can’t offer much help.”

Such a debate (assuming it actually occurs) is long overdue. It should have occurred during the election campaign.

We have to break up this megatrust.

I wish that I could make Human Action and The Road To Serfdom mandatory reading on the Hill, but it would probably be beyond the IQ of many, indeed most of them.

[Late afternoon update]

Thoughts on progressive corporatism:

At this point, I think that the relevant political divide is not between the two parties. It is between the forces of Progressive Corporatism and the (much smaller) forces of The Resistance.

Or, as Virginia Postrel has noted, between dynamism and stasis. That’s the real point. Despite all the rhetoric, these people don’t want change. They are defenders of the status quo. Everything they’re doing is to prevent change. They don’t want housing values to change, they don’t want bank stock values to change, they don’t want UAW workers’ salaries to change, and (most of all) they don’t want any change in their level of power over the rest of us.

Political Commentary, Space

Are You As Shocked As I Am?

46 Comments

If you are, you’re not very shocked. Ares 1/Orion is looking at an eighteen-month schedule slip. And no, it’s not because it was starved for money:

The problem isn’t just funding – which has become problematic for CxP over the last few years – but also what is described as “serious disconnects” between related departments, such as Orion, Ground Ops and Ares.

While continued changes to the designs of Ares and Orion are part of the natural development cycle, issues such as Thrust Oscillation and vehicle performance have come at a price for both schedule and costings, despite fine work from the engineering teams tasked with mitigating the issues.

a314CxP attempted to protect the schedule and budgetary pressures by offsetting these additional strains by deleting test items – notably on the Upper Stage. However, this only proved to cause further disconnects throughout the program.

Gosh, who could have foreseen that?

I haven’t read through the whole thing in detail, and I can see at a glance that there’s a lot to chew on, but the main point that seems to be lost is that, even if it was on budget, and on schedule, it is an intrinsic programmatic disaster from the standpoint of affordability and sustainability. Each mission would still cost billions of dollars, not even attempting to amortize the development costs, and there would be no more than a couple a year, into the indefinite future. This is not something that any sane person should be willing to spend fifty billion dollars on.

Doing Apollo made sense in the context of the Cold War, if not in opening up the space frontier. Repeating it half a century later makes absolutely no sense at all.

Business, Economics, Media Criticism, Political Commentary

The Double Standard

2 Comments

Instapundit:

Remember, when a private company wants to cover up billions in losses and the responsibility for them, that’s a major scandal and proof of the evils of capitalism. But when a government regulator does the same thing, that’s just how people are, these things happen, whaddyagonnado? Plus, more evidence that the country’s in the very best of hands:

After the companies were taken over, investors around the world who buy the companies’ debt and mortgage investments weren’t willing to pay top dollar, reflecting doubts about whether the U.S. government would stand behind the firms if they faltered further. As a result, mortgage rates initially rose, further depressing house prices, contrary to what the government intended when it took over the firms.

Then, earlier this month Freddie Mac lost its chief executive, longtime banker David Moffett, who joined the company at the government’s behest in September. He clashed with government regulators who pushed him to take steps that would forgo revenue opportunities. Freddie Mac is now looking for a new chief executive, chief operating officer and chief financial officer — and having trouble finding them.

Gee, why would a business that the government has taken over and mismanaged have trouble recruiting fall guyssenior executives in this political climate?

I think that Liddy missed a big opportunity to have a McCarthy-hearing style moment, after having to take all that Bravo Sierra from the anal orifices on the Hill who really caused the crisis because they were on the take, after taking a thankless job for one dollar a year. He could have castigated them for their own roles, and resigned, with an “At last, Senator, have you no decency?” He’d have been my hero if he had, and I suspect a lot of people would have agreed.

Media Criticism, Political Commentary, War Commentary

Thanks, Pat Oliphant

6 Comments

Roger Simon:

Oliphant – whose work I usually find humdrum in the extreme – has done us a favor. Deliberately or not, he has dropped the oldest of phony Leftist pretenses – that anti-Semitism and anti-Zionism are not the same. The poor, diminutive woman and child of Gaza in his cartoon are being eaten alive by a rapacious Jewish star, not by the flag of Israel. It is the religion or ethnic group (you decide), not the state – Jews, not Israelis – performing this supposedly horrific act.

Well, thank you, Oliphant, you racial primitive you. You let the cat out of the bag we always knew was in there. And you did it in the pages of the Washington Post.

It was always a pretty thin excuse.

[Update a few minutes later]

More thoughts from Ron Radosh:

in his new cartoon, Oliphant echoes the kind of propaganda once favored by the Nazis in their racist paper Der Strumer, edited by one of Hitler’s top journalists, Julius Streicher. What Oliphant does is show a headless Nazi-like soldier- an Israeli- goose-stepping Nazi fashion with his sword ready for action. He is ready to inflict a weaponized Star of David on a mother and child in Gaza. The right side of the religious symbol of Judaism is depicted as a shark coming at the hapless victims.

If you think the comparison to the cartoons in Streicher’s rag is going too far, take a look at this cartoon. Or this one: the Jewish “monster” with his claw-like hands trying to take over the world. One might wonder if Oliphant consulted this Nazi archive for inspiration.

He probably didn’t have to. They have modern equivalents in Middle East media.

Economics, Political Commentary, Science And Society

Making A Difference

11 Comments

I’m going to turn on extra lights tomorrow night at 8:30. I hope that many of my readers will join me. Hell, I might even turn on the air, though we won’t need it. I’ll just run it with the windows open.

I wonder what these people think when they look at a picture of the Korean peninsula at night? Who do they consider more virtuous, those in the light, or those in the dark?

Call it a vote for sanity and freedom.

[Later afternoon update]

Here are some more suggestions:

Our press release described ways people might celebrate the achievements of humanity such as eating diner, seeing a film, driving around, keeping the heat on in your home — all things that Earth Hour celebrators, presumably, should be refraining from. In the cheekiest manner, we claimed that anyone not foregoing the use of electricity in that hour is, by default, celebrating the achievements of human beings. Needless to say, the enviros in the blogosphere didn’t take to kindly to our announcement.

Needless to say.

If our Human Achievement Hour is at all a dig against Earth Hour, it is so only by the fact that we are pointing out what Earth Hour truly is about: It isn’t pro-Earth, it is anti-man and anti-innovation.

Got it in one.

[Update a couple minutes later]

Here’s the web site for Human Achievement Hour.

Media Criticism, Political Commentary

The Meaninglessness Of Political Labels

3 Comments

At the thread about the world’s most attractive female politicians, Alan K. Henderson notes that Alessandra Mussolini didn’t make the cut, though she’s got Hillary beat by a country mile. I’d never heard of her before, but she’s very interesting. She’s Il Duce’s granddaughter, and Sophia Loren’s niece, if Wikipedia is to be believed.

But what’s strange about the article (well, not so strange, actually, it’s typical) is the way the word “fascist” and the phrase “right wing” are thrown around freely, with very few references to actual policies that would justify such labels. It seems to contain many of the misconceptions described in Jonah Goldberg’s book. For instance:

Her relations with Gianfranco Fini, leader of the Alleanza Nazionale, never were very good, she announced; she then withdrew later, her resignation due to differences with him at least once.[9] This antagonism was exacerbated when Fini criticized some aspects of fascism, such as its antisemitism. She unsuccessfully challenged him for leadership of the party when he withdrew support for Benito Mussolini in a television interview in January 2002.

Note that there is an implicit assumption that there is something intrinsically anti-semitic about fascism. But one can understand why she might be upset about this slander against her grandfather because, for all of his other sins, there is zero evidence that he was anti-semitic. That was in fact one of the tensions between his regime and Hitler’s. It wasn’t just a coincidence that eighty percent of Italian Jews survived the Holocaust.

And of course, there was very little that was actually “right wing” about him, except that he appropriated the label late to differentiate himself, a man of the left all his life, and a national socialist, from the international ones in the Soviet Union.

And let’s puzzle out the next graf:

Mussolini suddenly left National Alliance on 28 November 2003, following the visit of party leader and the Deputy Prime Minister Gianfranco Fini to Israel, where he described fascism as “the absolute evil” as he apologised for Italy’s role as an Axis Power during the Second World War. Mussolini however defended the right of Israel to exist and declared that the world “should beg forgiveness of Israel.”

That hardly sounds like either a “right winger,” or anti-semite to me. Again, while it wouldn’t be inappropriate to apologize for being part of the Axis, Italy had nothing to apologize for when it came to its own treatment of the Jews, at least relative to the rest of Europe, or even with respect to the US, which refused to admit them in the thirties. So again it would be understandable that she would be upset about an apparent slander of her grandfather’s memory. The use of the word “however” in the last sentence implies that she would be expected to be opposed to Israel, when in fact there’s no reason to think that even her grandfather would have been.

This next one is hilarious, if you accept Jonah’s thesis:

Following her resignation, Mussolini formed her Social Action party, originally named “Freedom of Action”, and organized a far right coalition named Social Alternative. That was a surprising move, as Mussolini, during her political career, had always taken progressive stances on many issues, including abortion, artificial insemination, gay rights and civil unions. She has been an outspoken “feminist” and has been described by conservative commentators as a “socialist” and a “left-winger”.

So, what exactly is it that is “far right” about the coalition? They don’t say. We must simply take their word for it that it is. Is it possible that the move is not as “surprising” as it might be to people who don’t view the world through the conventional looking glass of fascism as “right wing”?

I loved this one:

In 2006 she responded to claims by effeminate Italian M.P. candidate Vladimir Luxuriathat she was a ‘fascist’ with the line “Meglio fascista che frocio” (“It is better to be a fascist than a fruit”).

Of course, she’s not necessarily admitting to be a fascist with that line, but she actually seems fine with the label, given that her grandfather invented it. Perhaps as a leftist, she understands fascism much better than most of her cohorts?

[Update late afternoon]

I missed this one. The very first sentence of the article:

Alessandra Mussolini (born 30 December 1962) is an Italian conservative politician…

So what is it that makes her a “conservative”? Her “progressive” views on abortion, artificial insemination, gays, civil unions? Her “feminism”? Or is it just that she’s an admitted fascist, and we all know that fascism is “conservative,” and “right wing”?

[Update a few minutes later]

Now that I think about it, she’s her grandfather’s granddaughter — a leftist who calls herself a fascist. Except unlike most European leftists, she’s not anti-Israel (and anti-semitic).