Thursday, January 31, 2008

Bill's Big Blunder

Bill Clinton, not known for gaffes, made a statement today that will have repercussions perhaps causing the ultimate destruction of his wife's campaign for the White House. In a speech in Denver while campaigning for Hillary, he said:

"We just have to slow down our economy and cut back our greenhouse gas emissions 'cause we have to save the planet for our grandchildren."

There will be a particular contingent on the Left that will laud the former President's bold statement. The people who have become followers of the Green Faith, whose leader is Pope Al Gore will no doubt be lured more towards the Clintons. Unfortunately for Billary, most Americans do not fit into this category, and are more concerned about how they are going to pay their bills and save for retirement than whether or not the dubious claims about Climate Change are followed by stout action to stave off some supposed global catastrophe.

It will be interesting to see how Hillary responds to questions about Bill's comments. It may decide her fate--at least in the general election.

Monday, January 28, 2008

John Fitzgerald Obama?



I saw this picture on the Web earlier and thought it was rather interesting. I am not so sure if Obama really has that much in common with JFK or if people just wish it were the case. After all, it has been decades since the Left had their love affair with Robert and John Kennedy. The old middle aged hippies who came of age in the Kennedy Era have joined forces with the young wanna-be 60s hippies who have gotten their kicks opposing the Iraq War as if it were Vietnam II.

Without a doubt, many youthful Republicans had a similar experience with George W. Bush, as if they were falsely nostalgic for Ronald Reagan. But the important thing to remember about 2nd Comings is that unless they are 2nd Comings of the same person, then they aren't the same person, and nobody has ever been the 2nd Coming of somebody else who ended up being that great.

Bush was supposed to be Reagan. He wasn't.

Clinton was supposed to be JFK II. He wasn't.

Now Obama is supposed to be the return of Camelot--but he won't be. In fact, we really don't know much about what he *will* be, and that's what should be concerning to Democrats (many of whom seem prepared to run a candidate who has never had a significantly contested general election campaign against a Republican in his career), and to the American public.

As America's attitude towards Party Politics evolves, I believe many Americans residing in the non-partisan center (which are now a third of all Americans) will begin to look at the two parties' candidates and make determinations about whether or not they trust those parties to select the right person for the job in their primaries. If Obama is elected and proves to be a disaster, then the Democrats will pay dearly both in the mid-term elections in 2010 and especially in the 2012 Presidential election and beyond.

The law of unintended consequences seems to have greater caution against an unknown like Obama than against a very known quantity like Hillary Clinton. Since the end of the World War II era, the Republican Party has held the White House for 36 years, the Democratic Party for 20. Bill Clinton was the only Democrat during this time to be elected to two full terms, whereas Eisenhower, Nixon, Reagan, and George W. Bush were elected to two full terms on the Republican side. This is partially because of the disastrous presidencies of Lyndon Johnson (especially the Vietnam War) and Jimmy Carter (economic policy and extreme weakness in foreign policy), who seemed to have marred their parties' future chances. Even Watergate wasn't enough for the Democrats to convince the American public that it belonged in the White House for very long.

The Democrats have done themselves no favors. They have nominated a pacifist (McGovern), an idiot (Carter), a tax-happy wonk (Mondale), and joke (Dukakis), a bore (Gore), and a gold-digging, botox-injecting Vet who betrayed his fellow sailors (Kerry). Are they really ready to nominate an untested, inexperienced law professor from Chicago just because he talks pretty?

The damage that could be done to the Democratic Party is perhaps greater than could be done to the country if Obama is nominated (and especially elected). If he is really terrible, the country will put another party in charge of Congress (whether it is the Republicans or an emergent 3rd party remains to be seen), and he will be immobilized for the last 2 years of his term, and then like Jimmy Carter he will lose in a landslide, and the Republicans might be back in power for another decade or more.

In the coming days, this blog will examine, in-depth, the policy statements and claims made by Obama on his website, and see if the country really knows what its getting into if it decides to elect him as President.

The Long Tail Promotes Better Art: Why We Should Reject Hollywood Once and For All

I read an excellent letter letter to the editor in Salon about the dumbing down of Hollywood. The letter makes an excellent point: Hollywood's increased focus on appealing to global market "blockbusters" has caused a dramatic increase in simplification of the films. The letter concludes brilliantly:

One doesn't succeed in this marketplace of ideas and entertainment by being simplistic and going for the greatest common denominator, but by finding your niche, exploiting it, and celebrating whatever you have that is fresh and different from everyone else. Seen from that angle, the fact that the Hollywood movie machine, in its relentless quest to maximize profits, is dumbing down so as to extricate the greatest profit from the greatest number, is just another signal of the long-term irrelevance and ultimate failure of a business model whose moment in the sun will soon be over.


The future of entertainment is in the Long Tail--appealing to a niche with thoughtful, provocative entertainment value. On occasion something will catch the eye of the masses and become a blockbuster hit. That's how it used to be. But the focus on the blockbuster has declined as a viable business model because the blockbusters became more about their hype than about their quality. With the growth of distribution of content over the Web, and the economies of scale now available in Web distribution, the Long Tail model will not only continue to make sense for distribution, but also for creation.

This isn't good news for the people who make millions promoting movies like "Spiderman 3" and other filth that passes for entertainment these days, but good riddance to traditional marketing agencies. Go get a real job.

"Low budget" will not longer be an epithet, but a badge of honor, and the new form of blockbuster--the one that naturally arises from genuine quality and popularity, will take hold. Few and far between, but truly enriching--like The Iliad and the Odyssey of old.

Supply & Demand at Work: Oil Slides to 3-Month Low, Expected to Go Lower

The cooling economy is sending oil prices lower, and speculators are backing out of their futures and options contracts. As a result, oil prices have declined to $85 per barrel, and they are expected to go lower. Although the long-term issues with oil supply and the increase of demand from India and China require attention, the Chicken Littles of the Environmental Movement who have predicted that "the end of oil" is nigh seem to have been wrong.

The moral of today's story is that the forces of Supply & Demand actually work. Without government intervention, the price of oil has declined. Why? Because prices outpaced demand. The buyers and speculators took note and began to sell. Insofar as oil has been very slightly responsible for the inflationary pressures in the economy, they will now back off a bit. This will have a positive effect on the rest of the economy as well. Unfortunately in our instant gratification, consumerist culture that is entirely devoid of patience, the people clamor for government action before the markets have time to adjust, and in the process they make the problems even worse.

We will learn our lesson one day...

Sunday, January 27, 2008

Losing Our Back Yard: Why the Bush Administration has Failed in Latin America

Little commentary is needed. The Marxist-Socialist threat in Latin America has returned. Hugo Chavez has capitalized on the ineptitude of this Administration's foreign policy, especially the War and the mishandling of US-Latin American relations. These sorts of moves will have tremendous ripple effects on our economy as countries become convinced of our instability. We need leadership in the White House to shore up our economic situation, not just through national policy, but through national leadership: the kind of leadership that inspires people to conserve rather than consume, to invest rather than spend, and to be responsible stewards of their monetary resources.

Read the details:

Chavez pushes for Latin American withdrawal of Dollar Reserves

Strange Change: The Establishment Votes for Reform?

For all of you Obama fans out there, clamoring for change and completely enthralled with the charisma of Barack Obama, I entreat you to consider something. Today, Ted Kennedy endorsed Obama. See for yourself. For somebody who talks about how messed up Washington is, Obama sure has some entrenched establishment figures endorsing him (Ted Kennedy and Patrick Leahy for example).

It reminds me of the scene in O Brother Where Art Thou? when Governor Pappy O'Daniel is sitting in a restaurant with his son and two advisers. The dialog goes like this:

Pappy O"Daniel: "We need a shot in the arm. You hear me boys? In the god-damn arm! Election held tomorrw, that son of bitch Stokes would win it in a walk!"
Junior O'Daniel: "Well' he's the reform candidate, Daddy."
Pappy O"Daniel: "Yeah."
Junior O'Daniel: "A lot of people like that reform. Maybe we should get us some."
Pappy O"Daniel: "Reform? Reform? I'll reform you, you soft-headed son of a bitch. How we gonna run reform when we're the damn incumbent? Is that the best idea you boys can come up with? Reform?! Weepin' jesus on the cross. That's it! You may as well start drafting my concession speech right now."

So Obama wants reform, but he is pointing to all of the "experienced" people who support him...what exactly do you think you're going to get when he has to go pay the piper after the election? Does America really want a President who is indebted to Ted Kennedy? This should be a sign to the Democrats that Obama is the wrong person for the nomination. After all, Ted Kennedy also endorsed John Kerry in 2004.

SmugMug: The Best Photo Utility on the Web

I don't frequently review products, but I have started exploring a lot of the new tools available in the social computing space and I am absolutely in love with SmugMug. It is the most elegantly-designed, easy-to-use photo utility for sharing pictures on the Internet. If you are a Mac user, you are going to love "MacDaddy," which allows you to rapidly upload photos in the simplest, fewest steps method I have seen to date to get pictures from your iPhoto to the Web. They have a similar tool for Windows users.

The site, which requires a small yearly subscription, is completely ad-free.

Everybody should go try out a 14 day trial today.

SmugMug

Barack's Pie in the Sky and Romney's Delusion

The Romney Delusion

Mitt Romney praises Bush, draws inspiration from Bush Sr. and Reagan, yet in 1994 when he was running against Ted Kennedy, he said he didn't support the policies of Reagan-Bush. See for yourself:



Courting the Republican base (the 30% of people in America who are blinded enough by their partisanship to give the President a positive approval rating), Romney has said whatever he thought he needed to say to prove that he is a real conservative. He touts his business experience and his experience as governor of Massachusetts as proof that he can handle the nation's economic problems, yet he endorses the Keynsian economic policies of this Administration that have thrust us into the most substantive inflationary economy since the Carter years.

Unfortunately, Romney doesn't realize that every time he says nice things about George W. Bush the Democrats are saving those videos, and all they will have to do in the general election is re-play Romney's own words, in debates and on the stump. No commentary will even be needed. Romney may be helping solidify the nomination by praising Bush, but it will be hard to run away from those comments in a few months. He has put himself into a precarious position--one that even his pomade and sweet-talking Mormon fakeness won't be able to get him out of.

At this point, the Republicans need to just suck it up and vote for McCain. He's not the second coming of Bob Dole...he's not a lot better, but he could be a lot worse.

Pie in the Sky: Barack's Naivete

Barack Obama's vapid rhetoric never ceases to dazzle the fat-minded masses. It also never ceases to nauseate me. He may have the delivery skills of Martin Luther King, but he doesn't have the substance.

"It's not about rich versus poor, young versus old and it's not about black versus white. It's about the past versus the future," Mr. Obama told the crowd that chanted, "Race doesn't matter."

"We are up against conventional thinking that says your ability to lead as president comes from longevity in Washington or proximity to the White House. But we know that real leadership is about candor, and judgment, and the ability to rally Americans from all walks of life around a common purpose — a higher purpose."

The trouble with Mr. Obama is that he has failed to define what that higher purpose is, or how we would get there. He has mentioned repealing the tax cuts. He has discussed massively raising social security taxes. And he has mentioned universal health care, but only in vague and undefined terms. If he is going to use such grandiose rhetoric to describe what his Presidency would be like, then he must explicate precisely how he intends to achieve that dream. Otherwise it is just more empty promises.

George W. Bush and Bill Clinton both ran on "changing Washington." So did Ronald Reagan and Jimmy Carter. They were the outsiders--the Governors who knew how to run a good state and thought they could change Washington. Yet they didn't change Washington. They didn't change it in tone or policy. The American train continues towards the inevitable cliff, and it has only gained in momentum.

No one person can change Washington. In fact, the only way to change Washington is to fire Washington--and only the American people can do that. In order for things to truly change, we must reject the stalemate that has emerged as a result of the Two Party System, and we must get a new Congress. That is the only way to change Washington--retake the people's house, send the pork barrel Senators home, and start afresh. 1994 was an attempt to do just this, but what happened is that in the aftermath of Newt Gingrich's departure, the Establishment came back and Dennis Hastert was annointed Speaker. As if to hearken back to George Orwell's classic novel Animal Farm, Hastert taught the pigs to sleep in human beds and to walk on two legs. And then Jack Abramoff was exposed--and Enron collapsed--and the War brought the lament of the Republican Establishment to a fever pitch and in 2006 the people said no more. So they put the Democrat Establishment back into power and they are equally (and by most measures more) unhappy with Congress now.

America doesn't need any more rhetoric--we don't need any more good speeches. What we need is good policy, and we need it fast. The cliff gets more inevitable by the day.

Saturday, January 26, 2008

George W. Bush, the Republican Jimmy Carter

Marx once said "History repeats itself: the first time as tragedy, the second time as farce." As we are now reaching the twilight of the George W. Bush administration, an administration I (regrettably) supported not once, but twice, on the promise of less government, controlled spending, and lower taxes (and thrice burned--inflation has more than wiped out the tax cuts), I have come to a rather depressing conclusion: George W. Bush is the Republican Jimmy Carter.

Let's follow the historical comparison (at least as far as it can take us). Richard Nixon was a wildly popular president when he was first elected. He was elected and then re-elected in Electoral College landslides. So was Bill Clinton. Richard Nixon was a phenomenal diplomat and foreign policy President. So was Bill Clinton. Nixon's problem was his arrogance--so was Clinton's. And both Nixon and Clinton got themselves into scandals that more or less completely wounded them (and their successors) irrevocably. Both men regained popularity and likability after being out of office (though it has not taken Clinton as long as it took Nixon). Al Gore was the Democrat Gerald Ford--he stood by the scandal-ridden President and so calls for change in the name of "honest" government seemed to stick. Both men lost their attempts to win a Presidential election.

Enter Jimmy Carter. Affable Southern Governor, devout Christian, not the most charismatic or articulate speaker, and completely devoid of judgment and common sense during his presidency. He wrecked the economy with bad policy, perpetuated foreign policy disasters (especially in the Middle East), and was a laughing stock in the international community during his presidency. Nobody took him seriously. This will be the legacy of George W. Bush. Jimmy Carter's foreign policy was inept because he was too weak, George Bush's because he tried to be too strong.

(Oh...I forgot to mention...they both took a beautiful opportunity to rebuild their party after almost a decade of opposite party rule, and ruined it.)

Peggy Noonan wrote yesterday in the Wall Street Journal that George W. Bush destroyed the Republican Party. I concur. But he did something worse--he contributed to the further destruction of America. He accomplished this killing of two birds with bad policy--on all fronts. As I reflect on his record of Keynsian economic policy, complete lack of courage or character on the nation's real fiscal crisis (the unfunded liabilities in Social Security and Medicare), and a war policy that has befuddled strategists, tacticians, and pundits on both sides, I can only conclude that the man simply didn't have it in him to be President. He was elected twice as a lesser of two evils. These sorts of people rarely turn out to be great.

Now we face a national debt that is nearly double what it was just 8 years ago, we have a budget deficit equal to what the surplus was 8 years ago, the unfunded liability crisis has increased by almost 50%, and our educational system and national infrastructure have been all but ignored. Our foreign policy is in shambles, and our diplomatic or "soft" power is diminished to its lowest point since the Vietnam War.

George W. Bush ran as the Second Coming of Reagan, but he was not a political Christ, but rather a political Antichrist. He was not the Second Coming of Reagan, he was the Second Coming of Jimmy Carter. He betrayed the Conservative-Libertarian base that elected him, and worse, he destroyed the Republican Party's credibility on both economics and national security--just as Jimmy Carter did in the 1970s.

Fortunately for us, George W. Bush will not be on the Ballot in November. But he has left a tall order for the Republican nominee--run away from the last 8 years and try to convince America that the Republican Party is in fact not the party of George W. Bush. I do not think this is an achievable goal.

The silver lining for those who don't want a Democratic President is that the Democrats are going to nominate one of the two most unelectable (Obama for his lack of experience, Hillary *because* of her experience) candidates in modern history. John McCain *could* beat either of them, but it will be another 50-50 election--2000 all over again, with probably not one but ten Floridas.

The nation will continue to be divided, and Washington will continue to fiddle while America burns.

"This is the way the world ends.
This is the way the world ends.
This is the way the world ends.
Not with a bang but a whimper."
-T.S. Eliot

Saturday, January 12, 2008

What Would Reagan Do? Or Why Rudy and Romney Don't Get Foreign Policy

If you have been paying attention to the Republican presidential primary debates, you will notice that Ronald Reagan's name has been invoked many times, almost in the manner of a deity. There is this clamor to be like Ronald Reagan in such a way as to hearken one's mind to religious comparisons--potential successors to a deceased prophet trying to out-do even the prophet himself. This of course is why all Calvinists are more rigid than Calvin himself, why all Marxists are more radical than Marx, Kantians more skeptical than Kant, and so on.

Rudy and Romney like to invoke the name of Reagan perhaps more than anybody--perhaps because they are the candidates who least resemble him, and therefore they are a bit self conscious. (I find this is also true of Christians...the ones who find it necessary to wear it on their sleeve all the time are most usually the ones who least resemble both the life and teachings of Christ himself).

For some reason there is a myth amongst Republicans that Ronald Reagan was this great war hawk. Actually, the opposite is true. Reagan believed in "peace through strength." That is, having a military large enough that it never had to be used. This is dramatic contrast with Rudy and Romney, who are saber-rattlers extraordinaire. Rudy is calling for massive increases in the size of the U.S. Military--a 50% increase in personnel, a build up to a 300-ship navy, and so on, but simultaneously calling for immediate military action against Iran. Perhaps the brilliance of Reagan's foreign policy is that he adapted Mark Twain's old adage "'Tis better to remain silent and be thought a fool than to open your mouth and remove all doubt." In foreign policy terms, Reagan never really used the military, except as a threat-deterrent. "Tis better to be thought an unbeatable power than to use that power and prove otherwise." Which is precisely what has happened in Iraq.

The reason Iran is so defiant is that they know a) the U.S. doesn't have the domestic political support to justify military action against Tehran and b) Even if the U.S. did invade Iran, Iran would probably win.

I'm not sure that there is anything more uncivilized about Rudolph Giuliani than his constant call for more military and more war and the continual justification of pre-emptive strike, as if America needs to "prove something" to the world and show that we still have our "manhood." I would rather show our manhood through massive economic strength, and being the cultural and soft-power leader in the world who people follow because they love us--which is what happened in the aftermath of World War II, when we really were viewed as liberators--instead of invaders.

Reagan understood this well. The Soviet Union was a threat--but he knew better than to call for military action against the Soviet Union. The most saber-rattling Reagan ever did was jokingly test out his radio mike (unaware he was live) by saying "My fellow Americans I have just signed legislation outlawing Russia forever. We begin bombing in five minutes."

Yet it's obvious that Romney and Rudy don't get it. Reagan called for a strong national defense. Romney and Rudy's rhetoric calls for a "stronger military." Seemingly, this is a splitting hairs, but there is an obvious underlying motive that is different. Romney and Rudy contemplate a military that can invade our enemies before they invade us. Their language is reflective of this. They talk of taking the fight to radical jihadism, rather than defending America from foreign threats.

The trouble for Rudy and Romney is that even if they were advocating Reagan's actual foreign policy, it wouldn't work today. This is not 1980. We do not live in a bipolar world, where the Soviet Union and the United States are the world's two superpowers, duking it out in a cold war where merely building a larger military helped to bankrupt the enemy. It shows that, for two people who talk so much about terrorism and "radical jihadism," they don't understand much about the necessity of new strategies to deal with such threats--especially strategies that do not involve the pre-emptive invasion of sovereign countries.

The only Republican who seems to truly understand the Islamic world is (regrettably) Ron Paul. The reason they hate America is not because we love freedom. That is a weird fantasy that a lot of Republicans seem to have frequently. Rudy and Romney say these sorts of things often. No, the Islamic world really does hate us because we have military bases in their territory--we have a long history of intervention in their region, and we have made it clear, under the Bush Doctrine, that we are going to keep doing it forever. When Ron Paul says this in the Republican debates, Romney responds with flash point garbage like "Well Ron, it's apparent you've been reading Ahminejad's latest press releases," and "If they just hate us because we occupy their countries, then why did the jihadists assassinate Benazir Bhutto?"

If the only way to combat terrorism is unending imperial wars, then I'm afraid we're in for some trouble.

In connection with my post from this morning, I'd like to start synthesizing some of my points about what is at stake in this election. Depending on who the Republicans nominate, this country will face a presidential election that puts us squarely between the Scylla of worsening our fiscal crisis through socialized health care and the Charybdis of worsening our fiscal crisis through imperial overstretch abroad. These two choices, though seemingly very different given the rhetoric of each side, are actually two sides of the same coin. They both promise security--but they go about it in different ways. The Republican mindset is that security comes through the prevention of threats from abroad. The Democrat mindset is that security comesthrough the prevention of the ills that plague humanity by its very nature: disease, sickness, and hunger.

To both the Republicans and Democrats, I paraphrase Benjamin Franklin "a people who would sacrifice freedom for security deserve neither."

Unfortunately both want to sell us out--just in different ways. When will there be somebody who wants to actually preserve America--rather than gain power by playing on people's fears?

Then The Gods of the Market Tumbled...

For those of you who didn't see the article in the Financial Times yesterday (and, I'm sad to say, I can't provide you with a useful link because FT nukes their content after 24 hours, except for subscribers), the U.S. government is in danger of losing its Triple A credit rating for the first time since it was originally assessed on U.S. government debt in 1917. With all of the other economic statistics barreling out in the mainstream U.S. media about unemployment, the U.S.'s credit rating may not seem like an extremely important factor, yet it is perhaps the most critical indicator that the 70+ year ponzi scheme that the federal government has justified with smoke, mirrors, and most importantly an ignorant voting public, is finally showing signs of cracking.

Having a Triple A credit rating means that the U.S. can borrow money at extremely favorable interest rates, primarily because it means that the risk of non-repayment is very low. A reduction in that credit rating by the actuarial gurus would mean that those financial wizards believe that there is an increased risk that the U.S. government might default on its debt. Fortunately, the credit rating has been affirmed, for now. But that there was a question is, in an of itself, a worry.

The United States is in uncertain fiscal territories. Those who say it is on the "brink of disaster" are perhaps sensationalizing things. The likelihood of a massive meltdown is quite small. After all, the U.S. is a $15+ Trillion economy, meaning it can withstand substantial shocks and not fall into some sort of precipitous decline. However, there are real risks on the immediate horizon. The U.S. currently has a national debt that is

with an additional $75 Trillion in long-term unfunded liabilities in the Social Security and Medicare accounts. With the Baby Boomers retiring, the specter of those bills coming due should haunt actuaries and accountants not only of the people responsible for America's check book, but also America's creditors.

As proof that I'm not just making this stuff up, I highly recommend you watch David Walker, the U.S. Comptroller General (Chief Accountant) talk about the crisis the country is facing (this video is a bit old, so the numbers are lower than they are today):



America's likely comeuppance for its fiscal malfeasance will be in the form of a gradual decline. Our international creditors will start charging higher rates for borrowing money, and our annual deficit will begin an even greater uptick as we maintenance the debt. Social Security and Medicare will bleed dry the current taxpayer, and the federal government will be faced with a situation where they simply cannot raise taxes any more and simultaneously dread the political disaster of non-payment of benefits to the highly motivated voting populace that is the elderly. So they will do what every government since the beginning of man has done in such a crisis: print more money. It's much easier today than it was a hundred years ago. The computers at the Federal Reserve can effortlessly create fiat money ad infinitum.

Prices will begin to go up, and the Dollar will continue to slide. And it will keep sliding and sliding, prices will keep rising and rising, until one day the world decides to stop holding their reserves in dollars. This is already beginning. It will continue.

And then things will get really good. We will experience something not seen in our lifetimes: hyperinflation. Prices will skyrocket by the minute. Americans have forgotten how bad this can really be. Russia experienced hyperinflation after the fall of the Soviet Union, and it was said that people preferred buses to taxis because you pay at the beginning of a bus ride and at the end of a taxi ride, and by the time you got to where you were going, the prices would have doubled, so it was advantageous to pay at the beginning. Think this can't happen in America? Continue to ignore history, then.

Eventually the hyperinflation will burn itself out. People will stop spending except on basic necessities. The rest of the economy will collapse and then prices will plummet as fast as they went up--only this time, nobody will take the greenback seriously. The people will begin to resort to hard currencies as the only trustworthy method of payment. "If you can't pay me in silver or gold coins, you aren't buying anything from me" will become a commonplace phrase.

This entire cycle: hyperinflation followed by hyperdeflation is what economist Ludwig von Mises called a "Crack-Up Boom." It is a scenario that seems impossible in our world of government salvation of all of our problems--but that is the trouble. It is the government salvation of our problems that has led to our ultimate demise. As the saying goes "all is not gold that glitters."

Unfortunately, this problem exists already--even without new entitlement programs. And in a year when it seems that everybody is rushing toward "Universal Health Care" and "Universal Health Insurance," which is just code for "Taxpayer-funded health care" that its advocates ignore what an extraordinary exacerbating effect it will have on the present crisis.

I think it would be great if everybody could have health insurance--but I'm not willing to risk the existence of the republic for a few years of health coverage for all. It is simply too high a price to pay.

As people go to the polls in the primaries and in November, it is imperative not only that we pressure all of the candidates to take our fiscal crisis seriously, but also that we vote for candidates who are tough enough to withstand the mounting political pressure to fix our short-term health care problems with new entitlement programs and as a necessary adjunct to those programs, more unfunded liabilities. We cannot have our cake and eat it too. And if we continue down the present path, there won't be any cake at all.

Wednesday, January 09, 2008

The Pollsters Got It Wrong or How New Hampshire Proved Again They Aren't Lemmings

Adding to their already spotty record in recent memory of failed electoral predictions, pollsters were embarrassed by their "double digit" projections of an Obama victory in New Hampshire. Rasmussen was the closest of the national pollsters, and he still had Obama winning by 7--far from Senator Clinton's 2-point victory. How did they get it so wrong, and what does that say for the rest of the campaign?

First, Hillary dispatched The Former President in full force in New Hampshire, and I firmly believe that is and will continue to be the most potent weapon in her arsenal. Bill Clinton forcefully, but articulately bashed the Obama "Fairy Tale," and Democrats listened. They long for the days of a Clinton Presidency again, and for better or worse, they still trust Bill. Bill also brings to the table 8 years of experience as President and people are reminded that Hillary is "Two Presidents for the Price of One."

Second, Obama's record is slowly being brought into the fore. Hillary is no longer letting him get away with his "hope" rhetoric without reminding people that he is a political neophyte. Although Clinton herself has never held executive office of any kind, being First Lady is a substantial look into how executive power operates. She would do well to actively point out that Obama has never run anything--except perhaps the Harvard Law Review (not exactly what I call "executive experiend.")

Third, New Hampshire voters do not like being told who to vote for. They revolted against Fox News's exclusion of Ron Paul from the Republican Debates, and they rejected Romney's massive spending as an attempt to merely buy the election. They also rejected the Iowa Bounce. Uneducated Iowa farmers were simply not going to tell this New England elite what to do. So this begs the question--does the independent streak of voters continue beyond New Hampshire? If history is any guide, Obama may have gone from "also ran" to "front runner" too quickly. For Howard Dean, this happened prior to the Iowa Caucuses. For Obama, it may have happened afterward. I would contend that the same people who followed Governor Dean are the ones actively behind Obama--the radical, unpragmatic ideological Left, the anti-war youth vote, and a handful of people easily led astray by a good talker.

Fourth, the situation proves that the media are the real Lemmings, not the voters. The media as quickly jumped off the Clinton bandwagon and onto the Obama bandwagon as soon as a poll suggested they should--after all, that's what gets the good ratings. Now the media doesn't know what to do--Obama or Clinton? I'm sure they will sit in their studios picking plastic daisies apart saying "Do we live him? Do we love him not?" The mass media has been in steady decline for the better part of the last fifteen years, but 2008 may be the end of its significant influence. The rise of the Internet, blogging, YouTube, etc., have made it much easier for people to get "the whole story" rather than what fits into a 30 minute news program.

Fifth, Democrats find themselves in a quandry. I don't think they have really decided amongst themselves who the "better candidate" is to face the still unknown Republican nominee. For those who have studied game theory, we have here (for the first time in memory) a two-level game in the race for the White House. There is no incumbent or Vice President on the ticket on either side. Consequently, both races being wide open has caused confusion in picking the pragmatic candidate--which is perhaps what led to Obama's victory in Iowa. A compelling case could be constructed either way. There is no doubt that Hillary is a massive motivator of the Democratic base--though I think Obama would do the same if he were the nominee. Hillary is more likely to motivate the Republican base in response, however. At the same time, the general election voter has still not really been polled--and he is a rather different animal from his cousin the primary voter. A general election voter could very well look at Obama and say "Hmmm, not just yet--come back in 8 years" or they could look at Hillary and say "Eh...something doesn't feel right about her." Not knowing who the Republican nominee will be complicates the matter immensely. Though it is increasingly looking like Romney, Thompson, and Giuliani are soon to be has-beens. McCain and Huckabee are the Republicans' best opportunities for a win in '08, though each presents his own unique challenges for the Republicans and their Get Out The Vote efforts in November.

However, both have the ability to bring back some of the old Reagan Coalition--blue collar rust belt voters who are economically liberal but socially conservative. They are neither one warmongers like Rudy and Romney, but they are not too Dovish like Obama or Clinton. They may be "just right" for Ohioans, Pennsylvanians, and Michiganders. That begs the question then: who is the stronger Democrat to face off against McCain or Huckabee in the swing states? Do Union workers in Michigan care about race or gender more? Do retirees in Florida trust Hillary or Obama to protect their entitlements more? Which candidate can handle foreign policy better? (The clear answer to the last question is Hillary--because she has Bill)

These are questions Democrats must answer seriously--and correctly. That is, unless they want 8 more years with a Republican in the White House.

Tuesday, January 08, 2008

So we left them to teach the Gorillas...

"A leader is a dealer in hope." --Napoleon

"We were living in trees when they met us, and they showed us each in turn,
That water would certainly wet us, and fire would certainly burn,
But we found them lacking in uplift, vision and breadth of mind,
So we left them to teach the gorillas and followed the march of mankind.

We moved as the Spirit listed, they never altered their pace,
Being neither cloud nor wind-born, like the Gods of the Marketplace.
But they always caught up with our progress, and presently word would come,
That a tribe had been wiped off its icefield, or the lights had gone out in Rome..."
--Rudyard Kipling

"But they were all of them deceived." -The Lord of the Rings

For 7 years, America has yearned for a more articulate, more eloquent President. I sometimes think that people are so blinded by the superficialities of candidates that they are able to ignore their substantive shortcomings. Not that all candidates don't have shortcomings, but it seems that if the candidate is attractive and articulate that the nation is more apt to gloss over their problems on substance.

And therein lies the causes of Hillary Clinton's Iowa catastrophe. No offense to the Senator and former First Lady, but she is not particularly attractive, and though she is not inarticulate, she is frequently shrill, mean-sounding, and angry. There is no doubt in my mind that Hillary Clinton is one of the most capable political maneuverers of our time, but she is not the kind of person that strikes the general populace as a likeable leader. Enter Barack Obama.

Everybody thought he was really running for 2012 or perhaps for the Vice Presidency when he got into this race. I knew better. First, the Clintons do not reward people who challenge them, and so if the Obama candidacy was to gain any traction, his chances of being #2 on a Hillary Rodham Clinton ticket would be next to nothing. And why would Obama run for President in 2008 when it would make more sense just to wait if he were really aiming for 2012? After all, given his last rock-star performance at a Democratic National Convention, he would probably be invited back. He could spend time building his grassroots, formulating an agenda and national organization, and using the Senate as his bully-pulpit to foment a 2012 or 2016 campaign--and he's plenty young for that strategy to work.

But he, and very few others, saw the great opportunity in Hillary's weaknesses--likeability. With his young personality, great oratory skills, and message of "hope," he knew that if he stayed in there long enough, he could bring down Goliath. And it appears that he has. I knew Hillary would be in trouble when billionaire David Geffen and long-time Bill Clinton financier abandoned the Clinton Coronation to take a chance on upstart Obama.

Obama's win in Iowa has now propelled him into the hearts of millions of Americans--especially young people. In one article I read this week, Obama's candidacy was compared to that of Robert F. Kennedy's campaign with respect to the intensity of support and even mania surrounding it. Obama's message of Unity and Hope might just be the ticket to the White House. I believe that people really are genuinely tired of politics as usual in Washington. People are tired of us vs. them, rich vs. poor, corporations vs. unions, republicans vs. democrats, christians vs. secularists, etc.

The last person to unite the country around a message of unity and hope was a man who said that it was "morning in America again." Ronald Reagan's vision of optimism and hope propelled him to unseat Jimmy Carter in a landslide after a hard-fought primary against a "more experienced" George H. W. Bush. He of course went on to win the largest electoral college landslide in American history in 1984.

Many people have compared Clinton to Reagan--amazing speaker, wonderful orator, uniter of his party, etc. I think that comparison is misplaced. Ronald Reagan emboldened his party--he made it to be OK to be a Republican again after the desolation the party faced in the wake of Nixon and Watergate. Reagan created a new coalition of people that lasted well beyond his tenure, and his Vice President was handily elected to the Presidency in 1988. Reagan laid the foundation for the Gingrich Revolution in 1994 when the Republicans took both houses of Congress.

In contrast, Bill Clinton never won a majority of the popular vote, and in 1992 garnered only 43%. His party, after 40 years in control of the House, was decimated in 1994 and was out of power until 2006. He compromised most of his party's principles to avoid a catastrophic loss in 1996, signing massive states rights welfare reform, supporting free trade, and finally acquiescing to the calls for a balanced budget after forcing Congress to shut down the government in the wake of his refusal to cut spending. And perhaps most of all, Clinton was utterly despised and hated by rank-and-file Republicans during his entire tenure. Reagan was more or less beloved even though the press loathed him.

Obama, I think, has the potential to become the Democrats' Reagan. I hate to say this, or admit it, because I rather loathe Obama. I think his policy proposals would be disastrous for the nation's economy, and I think he could shape up to be a rerun of Jimmy Carter on foreign policy. And that's the kicker:

Obama has not run on policy. He has run on this vague message of hope and optimism. In fact, little of this year's campaign has come down to policy on the Democrat side. Perhaps that's because all of the Democrats have roughly similar policies. So if Obama gets the nomination, and ultimately the Presidency based on non-policy, he will have to figure out exactly how it is he plans to govern. For this reason, he is a wild card--an unknown quantity. We genuinely have no idea what he will do when he is elected.

I earnestly hope America is not led astray by merely good oratory...

"Then the gods of the market tumbled and their smooth-tongued wizards withdrew,
And the hearts of the meanest were humbled, and began to believe it was true,
That all is not gold that glitters, and two and two make four,
And the gods of the copybook headings limp up to explain it once more."
-Rudyard Kipling

Sunday, January 06, 2008

Lessons from Dogs


Yesterday, as I was engaging in the ever-difficult task of getting my 7 month old Catahoula Leopard Dog, Adelaide (the one on the left in the picture above), to go into her crate before leaving the house for the day, I stopped to think about her behavior in relation to the American electorate. Most of the time I have to drag Adelaide kicking and screaming into her cage so she doesn't terrorize the house in my absence. But when I'm not in the mood for that I just say "Adelaide, want a treat?" and get her excited about the treat. I go to the cabinet, get a Milk Bone treat about 2 inches long and a half inch in diameter and I dangle it over her crate. She goes right in, I close the door to the crate, and then give her the treat. For the next few hours she loses her freedom, and for the low price of a 3 oz. wafer.

Our Red Bone Coon Hound, Aries, on the other hand, prizes her freedom. Fortunately, she doesn't have to be locked in her crate because she is responsible with her freedom in our absence, but she loathes taking showers. It is the ultimate loss of freedom, it would seem, for her. No treats, toys, prizes, gimmicks, or anything will get her into the bathtub or shower. She has to be hauled in, and if there isn't a closed door, it's a two-man job. She then resents you for the rest of the day for putting her through such torture. She really loves her freedom, and it doesn't have a price.

They aren't much different than most Americans, it's sad to say. Aries is the Good Steward American--the one who works hard, saves, spends wisely, who when she messes up (like eating leftover Chinese food out of the trash can) feels guilty and owns up to her mistakes, is calm and dutiful, and never complains about her existence. She just wants to be left alone most of the time, and merely acknowledged the rest of the time.

Adelaide is like everybody else--give her an inch, she demands miles upon miles. Let her play with a t-shirt and she wants to tear up all of your socks, too. Let her play outside and she digs holes to get under the fence. Her treat isn't enough--she thinks she deserves Aries's treat too. And most egregiously she is willing to continuously, without fail, sacrifice her freedom for a lousy Milk Bone treat. (This isn't to say I don't absolutely adore Adelaide-and think she's incredibly cute, but she is frustrating sometimes...)

Is the American voter really quite ready to hand over even more of its freedom for some sub-standard, government-sponsored health care? The average American already spends 5 months in his metaphorical cage every year paying off Uncle Sam. And even so, Uncle Sam is broke--beyond broke. He can't balance his short-term check book or his long-term check book. So we continue running multi-hundred billion dollar budget deficits every year and keep ignoring the structural debt of over $75 trillion in unfunded liabilities in Social Security and Medicare.

It would seem that the people who are buying into the Santa Claus rhetoric of the Clinton, Obama, and Edwards candidates are not only saying they are willing to go into their cage for an indefinite amount of time, but they don't even realize there isn't going to be a treat when they get there.

Even my dog isn't that stupid...

Friday, January 04, 2008

After Iowa: The Challenge for Huckabee

Today is more important than yesterday. What happened in the Iowa Caucuses will have less to do with who wins New Hampshire than how the victory is utilized by the victors moving forward. Let's look at the challenges ahead for the Huckabee campaign.

For Huckabee, Iowa accomplished a few things. First, it established him, without question, as a first tier candidate and at least for now, THE front-runner. He would have been considered it all along if he had had some money in the bank. Second, it helped fix the problem to which I just alluded: it will help him raise some much needed money to strengthen his national organization in advance of South Carolina, Florida, and Michigan. Third, it put Romney squarely on the defensive. Given Romney's propensity (thus far) for negative campaigning, I predict he will implode.

So where does Huckabee go from here? If Romney loses New Hampshire, it's game over for Mormon Mitt. Huckabee will then likely have to contend with an emboldened McCain, who will likely have been endorsed by soon-to-be-former candidate Fred Thompson. Giuliani will still be around until Florida, but if he loses there, he'll bow out too--my guess is he won't be making any endorsements. That puts Huckabee in the same position George W. Bush was in after New Hampshire 2000: a virtual head-to-head match-up against John McCain.

Like Bush, Huckabee has strong credentials with evangelical voters, and McCain is simply mistrusted both by that demographic and conservatives at-large. Unlike Bush, Huckabee already has a natural appeal to moderates and independents, who view his populism as a breath of fresh air. But that brings us to the person who may be the Achille's heel of the Republicans (even though I am largely sympathetic to his economic ideology): Ron Paul. Especially if Romney and Thompson are out, Ron Paul will likely pick up some stragglers: people who liked him already but wanted to vote for a "more electable" candidate who still shared much of their economic agenda. If Romney and Thompson are out, that agenda is no longer represented, and many Republicans may hold out as protest voters through the end of the election, thereby delaying the certainty of the Republican nominee.

If this happens, it is bad new the Republicans, because if Obama steams ahead to successive victories and cuts off the fundraising ability of Edwards and Hillary (which, though unlikely, could very well happen given the present political climate), then he will be able to get a lot of more or less undisputed air time while the Republicans are still fighting amongst themselves about who will be the nominee.

So here is what Huckabee has to do, not only to win the primary, but to do it quickly enough that he doesn't have a late-starter disadvantage against Obama heading into the general election:

Huckabee started smartly: he pitched to his super niche, white evangelicals. Most evangelical voters are not rich Republicans--they are blue collar or middle class folks with a mortgage, a car payment, two kids, the prospect of paying college bills in a couple of years, who go to Sunday School every week. There are lots of these people in the country--but not enough to win a Republican Primary, and certainly not enough to win a general election. He needs to immediately shift his focus (though not all of his attention) away from his super niche.

He has now secured his natural audience: the people who should love him and be enthusiastic for him simply for who he is. His next audience should be the pragmatists: the people who will vote for whichever Republican they perceive can win in November. This is not a difficult sell, but it will require some explanation. Mitt Romney, Rudy Giuliani, John McCain, and Fred Thompson are conventional candidates. So is Hillary Clinton. They run negative ads, they play into the Conventional Wisdom, and they are focused too much on policy (bad policy, to boot). Huckabee has always played to his own strengths: personal charisma, charm, wit, abilities on the stump. He has to turn that into an asset that can be bought by the Republican primary voters.

He's folksy enough to appeal to the common guy but (much unlike the current President) he can not only string together a coherent sentence, but is among the most articulate speakers in politics today. This is a quality lacked by Obama and Hillary--there's nothing folksy about them. Their Ivy League pedigrees are looked upon with suspicion by people in The Heartland. Huckabee has to convince Republicans that this matters and that he is the pragmatic choice.

Additionally, he has to convince non-evangelical conservatives that the only way the Republicans can win is to nominate somebody who can secure the South (as a Southerner, a Christian, and former Governor he can do that) as well as win the key battleground states. Ohio, Pennsylvania, Michigan, and Iowa will vote a for a Republican like Huckabee--they won't vote for a guy like Romney. As Huckabee himself said on Leno the other night "people want to vote for a guy who is more like a guy they work with than the guy who laid them off." A Huckabee candidacy will radically complicate the Democrats' agenda on so-called "kitchen table issues" in the upper Midwest and Pennsylvania.

After he has secured the pragmatists, he will likely have won over enough people to have the nomination locked up--and that's where it gets tricky. Then he has to minimize the impact of the people who actively dislike him--free market libertarians and social moderates. Part of this can be remedied by choosing a Vice President who is one (or preferably both) of those things.

Or, he could take an alternative route--pick a bipartisan Democrat Vice President and completely neutralize the independent vote. Sam Nunn and Joe Lieberman come quickly to mind.

More to come soon...

The Iowa Coup

Can you feel the heat? That's the flame emanating from thousands of political consultants across the country getting fired. The Conventional Wisdom is dead. Kaput. But let's not linger too much around its grave, because the death of the Conventional Wisdom is not the interesting part of the story--the interesting part of the story is what happens next.

The way campaigns operate has been relatively unchanged since 1960, when Television first entered the stage as the driving force in American politics. TV advertising, and the money required to run TV ads in major media markets became the sine qua non of campaigning. Campaign cash was more important than ever, because he who controlled the cash controlled the airwaves. That is starting to change, and political consultants and campaign managers across the country need to understand that if they do not adapt to these changes, their candidates are going to start losing to "amateurs" who are "broke."

The measure of a campaign is no more its long-venerated War Chest, but the power of the message and the strength of its grassroots efforts. Look at Iowa.

Barrack Obama (and Oprah) have raised quite a handsome War Chest, but has done so $20 at a time. He is the first candidate to have meaningfully brought young people into the campaign fundraising world, and has built a grassroots effort that beat back the Clinton juggernaut. Hillary Clinton had all but been anointed by the Press, the Conventional Wisdom, and the professional fundraisers as not only the Democratic nominee, but the inevitable Next President of the United States. Yet Iowa didn't even give her the consolation prize.

On the Republican side, nearly half of Iowa's voters selected candidates who had been given zero credibility from the Press and Pundits just 90 days ago: Mike Huckabee (who garnered 37% of the caucus voters) and Ron Paul (who garnered 10% of caucus voters). Ron Paul, an obscure libertarian Congressman from Texas, and the only Republican who voted against the Iraq War, has utilized the Internet to raise millions of dollars in the "Long Tail" (See Chris Anderson's Book, The Long Tail: How The Future of Business is Selling Less of More), with thousands of small contributors who simultaneously formed a passionate and energetic social community. Ron Paul gets Web 2.0--and the future of politics lies in many of the strategies employed by his campaign.

Mike Huckabee, the big winner in Iowa, routed Mitt Romney, who substantially underperformed in spite of millions in TV advertising, a massive staff, and a better organization than Huckabee's. Well, Romney and his team miscalculated a couple of things:

1. Thanks to the Internet, people know all the candidate's sins, pecadillos, shortcoming, gaffes, bad policies, checkered histories, etc., and as a result, they don't want another candidate (or special interest group) running ads informing them of such. "We know already, thanks."

Lesson: Negative campaigning is dead as a tactic.

2. Romney underestimated the power of free press, or as people in the business call it "earned media." Huckabee, primarily because his campaign was broke until about 45 days ago, had to earn media attention if he was to get any, and so he pulled some pretty impressive stunts. Chuck Norris was the bizarre grenade that got Huckabee the little bit of attention he needed to begin earning some press.

Lesson: Guerrilla Tacts work in politics.

3. Romney and his team underestimated the power of Huckabee's appeal to the evangelicals. Were there as many libertarians as evangelicals in Iowa, Ron Paul would have tied with Huckabee. Romney's scatter approach and "try to appeal to everybody" failed miserably.

Lesson: Always secure a super niche first. Then sell to everybody else.

4. Huckabee has more or less been devoid of catch phrases and sound bytes--the golden letters of campaigns prior to 2008. He hasn't tried to "control the message," because he knows he can't. Those days are long gone. Romney and his advisers must not have gotten the memo that people have started thinking for themselves (at least Caucus-goers in Iowa), and they won't be manipulated by "message development" anymore. Huckabee, in spite of some really really bad press (pardons, immigration, and economics--all of which were supposed to decimate him in a Republican primary) emerged victorious.

Lesson: Message manipulation and sound bytes are dead.

5. Lastly, Huckabee instinctively employed another essential element of a Web 2.0 framework in his campaign: transparency. There is no more genuine a candidate on either side of the aisle than Mike Huckabee. You can love him or hate him, but you can't accuse him of being fake. He is who he is, and he's relatively unapologetic about it. Yet he is good humored and honest, and most of the time a gentle person. Do not underestimate the power of "Realness" in this election. Mitt Romney is the polar opposite--he is fake and plastic, and most of the time appears completely disingenuous. Huckabee would annihilate Hillary and Edwards in a general election if this were the only thing that mattered--but it matters quite a lot; just ask Mitt Romney.

Lesson: To thine own self be true. People should love you (and vote for you) for who you are.

------

To the Conventional Wisdom and the Pundits--may you rest in peace.