Relevant and even prescient commentary on news, politics and the economy.

Another Fafblog Hit

If they keep this up, I can stop writing original posts and just excerpt Fafblog posts and direct my readers over there.

See, like this:

… Look at Al Gore, and how ANGRY he is over the torturing of Iraqis in American-run prisons. Such rage and pessimism! Look at Michael Moore, and how FULL OF RAGE AND PESSIMISM over his country being sucked into a bloody war of choice! And look at dark, dour John Kerry, crackin’ a joke about his ass! About his rage-filled, pessimist ass. The ass… of HITLER.

In fact now that Giblets thinks about it, Hitler isn’t that much of a pessimist compared to John Kerry. In fact Hitler’s got a lotta can-do, optimistic gumption. “Sure, I can fight fend off the allies in the west and conquer Russia at the same time!” he says. “Sure, all my problems will be solved if I can just kill every last Jew, gypsy and homosexual in Europe!” he says. He set goals for himself – difficult goals – and then tried to reach for those goals. That’s some pie-in-the-sky thinkin’ there…

Then I say, “Read the rest.” I’ve got the formula down, but I’ll need to come up with a name that’s less unwieldly than “InstaAngryBear”.

AB

P.S. For a little context, in case you missed it, see this International Herald Tribune story.

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Blotchy O’Reilly

From the Washington Post:

In kicking off what he called “no-spin coverage” of the issue, O’Reilly began the show by saying that “the Times and other newspapers have been under heavy fire for their misleading headlines, basically saying there was no link” between Iraq and al-Qaeda.

As Cole listened from Washington, the program played a clip of commission chairman Thomas Kean saying: “There is no evidence that we can find whatsoever that Iraq or Saddam Hussein participated in any way in attacks on the United States — in other words, on 9/11. What we do say, however, is there were contacts between Iraq and Saddam Hussein, excuse me, al-Qaeda.”

O’Reilly complained that this was the wrong sound bite. In retaping the commentary, he paraphrased one of Kean’s points but not the other: “Governor Thomas Kean says definitely there was a connection between Saddam and al-Qaeda. And he’s the 9/11 investigative chief, but that’s not enough for the Times.”

“I was sort of astonished he would do it so brazenly in front of guests,” says Cole, an activist attorney who has challenged the USA Patriot Act in court.

O’Reilly calls “totally absurd” the suggestion that he cut the sound bite “because it didn’t fit my thesis.” A producer had simply selected a clip that wasn’t right for the segment, he says.

What if any is the substantive difference between “not fitting his thesis” and “not being right for the segment [which had a thesis]”?

AB

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Interest Rates

Adding their voices to Kash’s view that interest rates should not be changed are Supply Side advocate Jude Wanninski and Keynesian Economist James Galbraith in a joint Op/Ed in the Sunday Washington Times:

One of us is the First Supply Sider. The other is the Last Keynesian. One is Republican; the other Democrat. One helped invent Reaganomics; the other spent four years trying to stop it. Yet we agree on one thing. Alan Greenspan should not raise interest rates now or in the near future.

…And while growth has returned, the economy remains far from full employment. We have enjoyed just a few decent months of job creation. A million jobs in three months is good news. But we remain about 1.3 million jobs below the actual level of payroll employment four years ago. We’re still about 5 million jobs short of what we should have, given population and labor force growth since then.

I’m not an expert in Macroeconomics, but I’d like to see us at least break even on jobs relative to where we were when Bush took office before the Fed starts tightening the screws. I suppose the silver lining of a rate hike is that it might hurt Bush. But I prefer my monetary policy rooted in economics, not politics.

AB

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No to Gephardt

A reader emailed me this missive this morning:

Please, continue to crusade against Gephardt. Whenever I see him, I immediately feel tired and old. He is sort of a black hole of energy – it vanishes in his presence. I don’t live in MO, BTW.

So I guess I’ll share the email I sent to Kerry’s blog last Friday(*):

Hi,

I think it might be worth passing up your chain of command that liberal and centrist bloggers and their readers are somewhere between 92% and 99% against Gephardt for VP. Seriously, I haven’t seen a single enthusiastic endorsement of DG; at most, just posts saying the VP choice doesn’t matter much, so DG wouldn’t be the worst thing ever.

Bloggers, and their readers, are a miniscule fraction of the electorate; but I think they are active water cooler/happy hour politcal conversationalists, both in terms of spouting their opinions as well as (and maybe more importantly in the current context) absorbing what friends and co-workers are saying. So there’s a decent chance that the sentiment among bloggers presages the likely reaction voters would have to a Gephardt selection. Seems like something the Kerry’s VP committee might want to consider.

On the other hand, I haven’t seen anyone write that they would not support Kerry just because he picks Gephardt. But that’s hardly a ringing endorsement.

AB

I did get a nice email back saying that the message had been passed on to the political desk (the sender noted that “According to a Pew/Roper report, the percentage of people online who are “influentials” in their communities is much higher than the general population.”) So hopefully they’ll pick someone else, which at this point apparently means John Edwards. If they do, I’ll take full credit.

Speaking of Kerry, don’t forget to make your final contributions. After the conventions, you won’t be able to give to Kerry anymore, so act now! So far, this blog has raised $5,342, keeping me ahead of my goal of raising at least 1/50th of what Atrios raises. Goal number 2, raising $10,000, looks elusive.

AB

(*) I would have posted this sooner, but I was searching in vain for a screenshot of Abe “Grampa” Simpson typing one of his angry letters (common in the early years of The Simpsons) to accompany this post.

UPDATE: Here we go. This is how I think my readers picture me, emailing unsolicited advice to the Kerry campaign (thanks to Xan for the link):

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Fed Watch

The FOMC will be releasing their assessment of monetary policy this afternoon. While it’s virtually a foregone conclusion that they’ll decide to raise the Federal Funds target rate by .25% to 1.25%, a lot of attention will be paid to the wording of the brief statement that will accompany the announcement. Is the Fed worried about inflation? Are they worried about a potential slowdown of the economy? Both? Neither?

I’ve argued before that I think that if you’re going to change interest rates, you should do it in a larger increment than one quarter point. But it’s still an open question in my mind about whether interest rates need to rise at all. Yes, inflation has picked up a bit recently, but much of that rise was due to a possibly temporary increase in oil prices (and which does seem to be reversing in recent weeks), and the level of inflation is still relatively low.

On the other hand, the economy is not growing particularly fast – 3.9% growth is rather modest by the standards of most recoveries – and there are reasons to worry about the recovery’s sustainability, both because of waning economic stimuli and the future behavior of asset markets.

If I were on the FOMC (surprisingly I haven’t yet been invited), I would vote to keep interest rates constant a bit longer. But I would probably be outvoted.

Kash

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David Frum violates Canada’s “Professional Political Punditry” Standards

Canada is having an election this week and Ira Basen is demanding better campaigns and commenting on “The Spin Cycle”. This piece is directed at former Bush speechwriter David Frum as he opines on the Canadian political scene. Rules #3 and #4 are speak simply to “staying within yourself”and speaking to issues of competence. Basen wrote this nine days before this Frum piece at NRO.

Frum notes that Federal revenues have risen by 45% over the past decade as GDP rose by 67% and then writes “the lion’s share of Canadian economic growth in the 1990s was pocketed by government”. Taxes rose by a lower percentage than GDP and he suggests the government is taking the lion’s share of growth? See Brad DeLong and Sadly No correct this silly error.

DeLong notes that the share of GDP taken by Federal revenues fell from 18% to less than 16%, which means the share not taken rose by almost 72% in nominal terms. Frum also talks about the more modest rise in after-tax income per capita, but never applies this same metric to GDP or Federal revenues. But why not factor in the increase in prices, which was just over 20% along with the approximately 10% increase in population to look at these growth rates in real per capita terms. Of course when one does this, we see real GDP per person rose by about 25% while real Federal revenues per capita rose by less than 10%.

Yes, Isa Basen standards make a lot of sense to me but then I don’t write for the National Review.

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A Symposium on Offshoring

Last week, the Brookings Institution held a day-long symposium on the offshoring of services to foreign countries. The list of invited speakers included many of the world’s top trade and labor economists. While the text of the presentations is not yet available, the symposium’s website does link to various excellent background sources that may be of interest.

One of the most informative general background pieces on the issue is one by Brookings’ well-known economist Charlie Schultze, “Offshoring, Import Competition, and the Jobless Recovery“. (Incidentally, Schultze, who was chair of the CEA during the Carter administration, is also the author of one of my favorite books explaining the basics of macroeconomic policy to the non-economist.)

The main conclusion of Schultze’s background paper, and seemingly of the symposium in general was simply this: there’s a fair amount of circumstantial evidence that the offshoring phenomenon has had a relatively small impact on the US labor market, but we lack the good data needed to really know for sure. Most people probably find the subject of data collection and analysis by government bureaucracies to be one of the most boring things in the world – it’s awfully hard to imagine the typical voter getting upset because they think budget for the Bureau of Economic Analysis is too small, for example – but this is an excellent example of exactly how the lack of good data can handicap policy debates, and why spending money on government data collection is so worthwhile.

Kash

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Sec. Powell Should Read Imperial Hubris

Condoleezza Rice refused to comment specifically on “Anonymous” because, “I don’t know who Anonymous is.” In an interview with Wolf Blitzer Secretary of State Colin Powell said:

I don’t know who he is. I haven’t read his book. I think what we are seeing are an insurgency in Iraq and terrorist activities elsewhere in the world. I think what we are also seeing is that the world is coming together in the clear understanding that we have to deal with these kinds of terrorist organizations and not just write it all off to Muslim extremism. There are some people here who just don’t want to see progress. They are not acting in the name of Muslim — of Islam. They are working against Islam. They are violating the basic tenants of Islam. And what we have to do is to continue to bring the world together in this effort to defeat this kind of thinking and to defeat these individuals. But I don’t know who Anonymous is, and I can’t really comment on his book because I haven’t read it.

Contrast this take on Al Qaeda, which appears to be pre-approved by the Office of Political Affairs with that of the man heading the very hard working staff at CIA dedicated to the Al Qaeda issue:

And the genius that lies behind it, because he’s not a man who rants against our freedoms, our liberties, our voting, our — the fact that our women go to school. He’s not the Ayatollah Khomeini; he really doesn’t care about all those things. To think that he’s trying to rob us of our liberties and freedom is, I think, a gross mistake. What he has done, his genius, is identify particular American foreign policies that are offensive to Muslims whether they support these martial actions or not — our support for Israel, our presence on the Arabian Peninsula, our activities in Afghanistan and Iraq, our support for governments that Muslims believe oppress Muslims, be it India, China, Russia, Uzbekistan. Bin Laden has focused the Muslim world on specific, tangible, visual American policies. And there seems to be very little opposition to him within the Muslim world, and that’s why I think that our assumption that he distorts Islam is just that, it’s analysis by assertion. I’m not sure it’s quite accurate.

Read the whole interview and note that Anonymous is frustrated that the insights of the analysts are being blocked by “senior bureaucrats”. Was this why Richard Clarke wanted to “shake the trees”? But Dr. Rice was not interested in shaking the trees. I have my doubts that the Office of Political Affairs would allow Sec. Powell to get a word in edge-wise as far as affecting White House decisions, but should not the Sec. of State read what the analysts are saying about what drives Al Qaeda’s support?

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Giblets on Gephardt

I can’t add anything to this (except approving laughter):

Dick Gephardt. Gephardt would have an amazing pull with loser voters, voters who like losing the House to opposing parties, voters who have a long history of being supported by decrepit and dying labor institutions in failing political campaigns, just people who generally like to lose. He could swing loser states, such as Wyoming or Rhode Island, or put states with a large loser population, such as Nevada or Alabama, into play. The upside to having a Kerry-Gephardt ticket is it would take all those people who go into shock in the voting booth thinkin’ “Oh dear god we nominated Kerry?!” and push them just far enough over the edge with “Oh dear god we nominated Kerry and Gephardt?!” that it would sort of jar them into a feeling of complacent somnambulism that would render them susceptible to voting for Kerry-Gephardt anyway. The downside to this is that such a hypthetical waking sleepstate could also get them to vote for Nader.

Read the full post for analysis of the rest of the field. (I opined against Gephardt in this post.)

AB

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