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

Thus Spake the Rube

For the hundredth time the foreign-born Muslim commie Nazi extends an olive branch across the aisle, and for the hundredth time it’s dashed to the floor, stomped on and set ablaze – along with the latest spokes-liars trousers.   It became a conflagration that the infamous water-stop could not staunch.

Early in Marco Rubio’s alleged rebuttal to B. Hoover Obama’s latest exercise in political theater it became painfully obvious that his pants were on fire.  This was even before it became obvious that his diatribe was utterly incoherent.  Steve Benen explains.

By any sensible measure, Rubio’s entire pitch was incoherent gibberish. He thinks President Obama is hostile to free enterprise and wants to increase the deficit, neither of which makes any sense. Rubio thinks the housing crisis was caused by big government, which is simply idiotic. Rubio celebrates his family’s history of dependence on government social programs like student loans and Medicare, while articulating a policy agenda that guts government social programs like student loans and Medicare.
Forget ideology, subjectivity, and areas of opinion — the fact is Marco Rubio’s speech was filled with a series of claims with no meaningful connection to reality. The senator even thinks combating the climate crisis means asking government to “control the weather,” which is just genuinely dumb.

Part way through I started taking notes, and discovered an unappetizing platter of rewarmed left-overs [or more accurately: right-overs] of Romney’s failed presidential campaign, where lying and incoherence were the norm.  It was deja vu all over again. Viz:

Obama’s obsession with raising taxes
Solyndra [God help us – I am not making this up]
We should open Federal lands to energy exploration
Grow Energy industry [but not renewables]
Lower Corp tax rate [Highest in the world, don’t cha know]
Incentivise school districts
Schools of choice
Solve the debt problem [As if BHO ignored it – or, more importantly – as if it were a real problem]
Obama created the debt with excessive spending  [my personal favorite]
Need a balanced budget amendment  [the ignorance – it burns, too]
Obama’s in favor of leaving Medicare just the way it is [though he clearly stated otherwise]
He also wants to unconstitutionally undermine 2nd amendment rights
The President’s devastating cuts to our military [Seriously — WTH?!?]
Moral breakdown in society – need more faith
Economic liberty

That’s what I was able to capture as Rubio’s litany of [mostly] decades old Republican clap-trap spewed forth almost faster than I could record it.

One of the MSNBC commentators pointed out that this nonsense wasn’t directed to the American public, who I hope are beginning to see through the smoke screen, but to the hard-core right-wing base.  As such, it’s Rubio’s first gambit in his run for the 2016 presidential nomination.

I don’t know if I should laugh, cry, or drink myself into a stupor.

It’s Only the Bottom of the Second: Fearful of Losing My Bet with Lance

Greg Sargent, whose Gatekeeper Job at Kaplan Prep Daily makes him somewhat important in determining the results of elections, cast a pale over my good mood about my dinner bet with Lance Mannion this morning:*

Having trouble getting outraged with Romney campaign sending out only good parts of Det[roit] News endorsement. Seems like par for course.

Romney is still dealing with Newton Leroy, the Gold Bug, and the Spreading Guy. Which means the big money on his side is still somewhat diffuse, what with Sheldon Adelson still considering wasting more money Stimulus Spending on The Never-Ending Book Tour and Foster “put an aspirin between your knees; I’ve never heard of doggie-style” Freiss still supporting, and supported by, Beelzebub in a Sweater Vest. Not to mention whoever (other than himself) is spending money to keep Mr. My-Son-Might-Be-the-Vice-Presidential-candidate-and-all-I-got-was-this-racist-newsletter in front of the CNN cameras.

Short version of the above: It’s a long time before the election. If the Supposedly Liberal Gatekeepers are already becoming inured to Romney’s, er, Selective Amnesia—what humans would call “lying”—it’s going to be a Very Long Summer and Fall.

Probably from Grace, voluntarily.

*All right, he sent it out last night. But Twitter is potentially asynchronous, and I only read it this morning. Before then, it was alive in another reality, like that bloody, overused, misinterpreted-as-if-it-were-an-economic-model of a cat.

Santorum Surge, Part 144

Let’s ignore that three of his four wins (including two last night) have come in non-binding caucuses and take a quick look at The Size of the Santorum Surge.

Over at Skippy, Our Leader posted a link to a discussion of whether “Romney’s strengths” could beat Obama. I wisecracked, without looking at the data, that the total Republican votes in all three states were lower than the daily NYC subway ridership.

My bad. That’s not even a ballpark comparison. On its lowest day, the NYC subway averages more than 2,350,000 riders. (That’s a lot of elitists, Newt.) It averages more than three million (3,000,000) on Saturdays, more than four million (4,000,000) riders a day, and more than five million (5,000,000) every weekday.

By comparison, here are the number of votes cast yesterday in Republican primaries/caucuses:

Clearly, we need a smaller comparative to make the turnout appear more impressive. So let’s look at one of my favorite demographic measures, Metropolitan Statistical Areas (MSAs).

Keeping in mind that the MSA includes the areas around the cities named, the total voters in the three Republican elections yesterday would occupy…the 144th largest MSA,* just behind Eugene-Springfield, Oregon (351,715).

The Santorum Surge: Smaller than Peoria (#135), bigger than Kalamazoo (#148).

*I resist saying “Gross!” at this point.

The Time I Offered to Bet $10,000

Note: I wasn’t going to post this, but after all the flack Willard Romney is receiving about offering to bet his fellow millionaires $10,000, I find myself in the unusual position of being sympathetic to him.  Therefore, the story of the day in early November of 1992 on which I offered to bet $10,000:

UPDATE: Paul Mulshine (h/t Blue Jersey) claims that had Perry taken the bet—that is, had the courage of his convictions—he would “have awarded him the 10 grand.”***** Instead, Perry claimed he’s “not a betting man,” all evidence contrariwise (e.g., his continuing this campaign) notwithstanding. Instead, the multimillionaire lied. Good thing he’s not running on character.

I am, truth to be told, probably a lousy poker player.  Not so bad as Barack Obama, but—aside from tells—when I see a sucker, I don’t hesitate.

So, a while back, when Lance Mannion (of Lance Mannion is Still Wrong fame) started tweeting about how Obama’s recent activities meant that liberals need to double-down and work to get large Democratic majorities for Obama in 2013. Since that worked so well in 2009-2010, I went looking for an opening.  And found one:

Really, Boehner almost lost his Speakership over this, he may yet, and he sounds like he won the World Series –

which required an appropriate, calm, measured reply*:

@LanceMannion Really, Obama lost his Presidency over this, and he sounds as if he’s cruising toward multimillion dollar CofC [Chamber of Commerce] speaking fees.

which produced the bet:

@klhoughton Dinner says he’s re-elected.

which lead to a discussion of betting on Presidential elections, which I admitted I only did once before:

K: I did bet $10K that WJC would win. But that was the day of the election. Now, my biggest risk is that Romney beats Bachmann.

L: You bet HOW MUCH?????

K: $10,000. (Trade was vetoed by my boss. Long story. Still bitter.) Other side was someone who is prominent [and from what I can tell a major source] in [William D. Cohan’s] House of Cards.

The bitter story below the fold.

It’s Election Day, 1992.  I am (somewhat) young, single, paying about $600/month in rent, and making Real Money for the first time in a year or so. (Ask your grandfather about the recession of 1990-1991.) In short, I am not liquidity-constrained.

Alan “Ace” Greenberg—the last CEO of Bear Stearns who was worth paying—had endorsed William Jefferson Clinton several months previously. He was the first head of a Wall Street firm to do so, but not the last.

Meanwhile, George H. W. Bush has been going around the country for the past week, campaigning as if he doesn’t want to win.  Or at least that’s the way it sounded to me, and I suspect the majority of the American people. It’s long after the Supermarket Scanner incident,** but he has spent the past two days yelling—calling Al Gore “Ozone Man” in Detroit—and generally Not Being Serious. For a candidate whose major strength is that he is Serious, it was clear that he was expecting to lose.

When the candidate expects to lose, it’s not a bad idea to bet against him. His information is likely better than yours, and his “tell” is showing.

So when one of the salespeople, who had a rather short temper, was pontificating at the end of the day about how GHWB was going to win that evening, I offered a friendly wager. At least, it started out that way.  But this is Wall Street.

Ken: “Bet you $10 Clinton wins.” As I said, trying to keep it a friendly wager. We would spend more than $10 on lunch (which was a company expense anyway).

Salesman (irritated at being challenged): “Make it $100.”

Well, when the mark says, “Take my money!” it’s at least a venial sin not to do so.  But if we’re going to talk about real money…

Ken:  “Make it $1,000.”

Salesman (getting angrier): “If you’re that certain, make it $10,000.”

At this point I hesitate. Not for effect, but just to do the calculations.  I know I have about $20,000 in liquid assets*** at the time, so another order of magnitude is out of the question.****  Can I afford to lose A Sure Thing?  Absolutely.

Ken: “Done.”

At this point, my boss—who had met the soon-to-be-former President and still thought fondly of him—intervened. (It is left as an exercise whether he made it up to me in bonus.)

So when millionaire Willard “Mitt” Romney offers to bet $10,000 with millionaire Rick Perry or millionaire Newt Gingrich, he’s basically fitting the minimum criterion for “this should get your attention.”  It’s hardly an “all-in”bet; as Hendrik Hertzberg notes, it’s more a casual wager.

As Francis Scott Key’s descendant once noted, “The rich are different.” And Papa’s rejoinder, “Yes, they have more money” is especially relevant when judging how sincerely the person believes their position to be correct.

Mitt’s offer to his fellow multimillionaires isn’t notable for its size; what is notable is that—as with me nineteen years ago—neither Gingrich nor Perry was willing to call and raise him.


*Those who have read my last two posts will realize that I say this without the slightest hint of irony, and that your mileage may vary.

**I’m sympathetic to GHWB on that one, by the way.  I lived and shopped in Washington Heights at the time, so we didn’t have scanners in any of our supermarkets either.  No one managing those stores would even think about making that type of capital investment.  And I shopped in stores a lot more often than the President—or even the Vice President—of the United States ever would. Those being the two jobs GHWB had had since 1981, the odds of him having encountered a supermarket scanner are about the same as [pick famous actress not related to my neighbor’s husband or filming one of her novels] showing up on my front door.

***I may have been counting Lines of Credit as part of liquid assets.

****I’m certain, in retrospect, that he would have said “done” on $100K. And given that I would have estimated the probability of losing at less than 10%, economic theory says that I should have offered the higher amount, even knowing I couldn’t cover it.  I believe this is the theory recently used by MF Global, who were dealing on direct-from-Mario-Draghi information.

*****The AP disagrees, but I find myself agreeing with Mulshine—a strange feeling in itself.

Posts I Won’t Write

Buce sends us to Der Spiegel’s description of Barack Obama’s potential 2012 opponents (“You Think This is Bad?”)

John Kay in today’s FT (no link) tells us why letting economists pontificate about finance is a Mug’s Game. The mugging being of people who are stupid enough to believe economists. (If Brad DeLong or Mark Thoma links to this one, I’ll add a link to them.)

This (from Kaplan Daily of all places, but Valerie Strauss is one of the only Bright Lights there) is probably the most important general article about standardized testing and education.

This one tells the truth and shames the devil, as it were. Those fooling themselves that vouchers and charter schools will lead to improvement in anything other than excess rents going into the pockets of the people who are hired to run them (such as Christopher Cerf, President and COO and Christopher Christie, lobbyist) either have forgotten or are ignoring history:

Decades of research have shown that not only do the for-profit, corporate models being forced on school districts from coast to coast not work, they present a separate and unequal solution, and offer huge profits for investors.

Anyone stupid enough to believe the “anti-piracy” crowd has the best interest of Creators in mind needs to mark that belief to market. For another data point (via Dr. Black), see here.

On a more positive note—not to mention having grown up watching Bob Braun as a local, afternoon talk-show host—I want to note Mr. Braun being one of the only reasons to read The Star-Ledger, and especially highlight his series dealing with ICE abusing its power (nu?) and almost preventing a girl from saving her sister’s life.

This one has a happy ending.

Republican candidates and taxes

Think Progress carries quotes from the Presidential contenders and election slogans

The release of this plan immediately spurred the natural Republican tax apoplexy, with the GOP presidential candidates decrying tax increases as a surefire way to destroy jobs:

MITT ROMNEY: President Obama’s plan to raise taxes will have a crushing impact on economic growth. Higher taxes mean fewer jobs – it’s that simple. This is yet another indication that President Obama has no clue how to bring our economy back.

RICK PERRY: President Obama’s plan is a bait and switch that offers more than a trillion dollars in higher taxes for a promise of temporary tax relief…Worst of all, the Obama plan fails to provide the certainty employers need to create jobs.

MICHELE BACHMANN: Mr. President – you don’t create jobs by increasing taxes on job creators. The President’s plan to raise taxes on the American people is the wrong policy to create economic growth and jobs and shows he doesn’t understand how to turn our economy around…If Warren Buffett believes he doesn’t pay enough taxes, then he should write a check today to the Treasury, but he and the President shouldn’t enact warfare on the millions of small businesses, on charities and on middle class America with increased tax burdens.

RON PAUL:[W]hen the President starts targeting the so-called rich, he’s really targeting small business owners, so ultimately he’s threatening the little guy. The President’s plan, then, will result in a fatal broadside to the national economy from Main Street on down….A $1.5 trillion tax hike will do nothing to help us out of this mess we’re in, and will more than likely create more problems, lead to less investment, and cause more job loss at a time when Americans of all kinds are hurting.

JON HUNTSMAN: President Obama continues to demonstrate that he has no new ideas on how to create American jobs. For two and a half years he’s been peddling a version of the Buffett Tax Hike as a key pillar of his failed attempt to tax and spend and regulate this country to prosperity. That simply hasn’t worked and it won’t work now.

HERMAN CAIN: Here’s what I can tell [Obama] about math: raising taxes on anyone, no matter their income level, will do nothing to stimulate our economy, create jobs or balance our federal budget. Increasing taxes on the private sector will destroy jobs, further damaging our economy and sending even less revenue to the federal government.

NEWT GINGRICH: In the midst of the worst economy since the Great Depression, job creation must be job one for our political leaders. Instead, the president has chosen a path of political gamesmanship and class warfare with a plan that would kill jobs with higher taxes on small businesses and private capital.

Links Worth Rants

Busy day on several fronts, but these should be discussed and I’ve already posted one rant this week, so a riff on the second piece would be overkill. Sort of an Open Thread, with four topics.

  1. Tyler Cowen argues that, instead of giving out stimulus monies, the government should just hire people directly. No, really:

    Let’s say seventy percent of the stimulus gets spent on labor at all, and only forty-two percent of that gets spent on unemployed labor….That’s less than thirty percent of the initial expenditure being spent on unemployed labor and that is before any other problems with the expenditures kick in. It’s hard for me to see that as a triumph of the program (NB: we are only talking about one part of ARRA here); would direct government employment have overhead costs that high?

    UPDATE: Matt Yglesias comes the same conclusion I did: that the Jones and Rothschild study advocates “a targeted make-work program for unemployed people.” And Mike Konczal does the definitive takedown of pretending the study reads as anything other than that ARRA was successful and too small.

  2. Anyone who thinks that S&P will be in business five years from now should read this piece. Not even the market is stupid enough to believe that house prices cannot decline 5%, or that the costs of payment delays and the like will not eat the “value” of these securities. That’s not unique; what has changed is that investors are saying so.
  3. Marshall Auerback suggests that Germany may be preparing to exit the Euro. My rough sketches suggest that’s a bad idea for their banks, but it might do their companies some good. As he notes, “[his] view, which was once considered borderline crazy, is now getting more serious consideration.”
  4. Everyone who claimed that Jon Huntsman is a “sensible, sane Republican” owes the rest of us a sackcloth-and-ashes level apology. Anyone who still does it is a pawn or an idiot.

Bachmann-Perry Overdrive, the Snag, and Other Notes

The real story of Michelle Bachmann’s “win” in the Iowa straw poll (not to be confused with the Iowa primary) isn’t that she got just over 4,800 votes—it’s that she paid for 6,000, proving at least 1,200 Iowa straw pollers are smarter than most of the reporters covering her “win.”

Late to the party mention: The Kauffman Institute’s Blogger Survey results are here (I hope).

The people who rant about 51% of Americans “paying no income taxes” are strangely silent about the fact that more than two-thirds of corporations don’t pay any—and they aren’t subject to Social Security or Medicare/Medicaid taxes either.

More Dr. Seuss is good, though “newly enhanced Seuss illustrations” sounds suspiciously like a step beyond even the later collaborations, such as The Butter Battle Book.

Robert (at least on his FB feed) is trying desperately to be nice to Matt Yglesias. I’m not, since Matt “I’ve never attended a public school so I know what’s wrong with them” Y. continues to fool himself about “the need for education reform” and refuses to pay attention to the research that shows most of those “reforms” his hedge-fund buddies are championing have been tried and failed. Jersey Jazzman does the heavy lifting here and (especially) here, while Bruce Baker notes the core of the Charterist argument.

Want a clear explanation for why people become writers or, if they don’t write well enough, bloggers? Jason Albert in, of course, Slate explains his own ego.

(The idea that maybe we need a third category of uncreative typist—Slate columnists—rises up when they try to make an economic argument without understanding sunk costs. But giving them any more pageviews would be a violation of the Douthat Rule.)

Abolish the Republican Party Now

If I made this up, you would never believe me:

“He informed me by text while he was on the floor,” [Erie County Republican Chairman Nicholas A.] Langworthy said of [New York, State Sen. Mark J.] Grisanti’s Friday vote. “I urged him to stick by his word he had given. The people elected him on what he ran on. This is not tax policy or something. This is important stuff.” [emphasis mine]

Good to know The Republican Party has ceased to give a shit about anything for which the Ancestral Party stood.

(via Lance)

cross-posted from Skippy

Why Would Anyone Call Congressman Ryan’s Plan "a Budget"?

More on the health-care later, but let me be clear:

Congressman Paul Ryan’s “plan” is NOT a budget.

Budgets show Sources and Uses. As the CBO analysis makes clear, this “budget” is no more a budget than Ryan’s last round of fakery. To wit:

The path for revenues as a percentage of GDP was specified by Chairman Ryan’s staff. The path rises steadily from about 15 percent of GDP in 2010 to 19 percent in 2028 and remains at that level thereafter. There were no specifications of particular revenue provisions that would generate that path. (CBO, page 11; emphasis mine)

This is the equivalent of my current household budget, which is heavily dependent upon winning the lottery sometime in the next three years even though there is no provision for buying tickets.

I’ll call Ryan’s proposal a budget when—as, for instance, Obama’s does—he specifies Sources as well as Uses. Until then:

And, with due respects to the alcoholic lout, sometimes a fantasy is not all you need.