WhiteHouse2008

CONTENTS OF THIS PAGE: or just click on pictures below to take a more right-brained review of the news!

TABLE OF CONTENTS TO THIS PAGE: within each area, items in reverse chronological order.

Newspaper reports (and columns) selected by this website, arranged in reverse chronological order...

Financial melt down.
"During the general election" articles here.
What went before the end of Primary Season...
Issues '08.

Cabinet and "team" news, selected by this website. POLITICS: Campaign Finance Report you MUST check out!!! "S" stands for "scenario?"

To the barricades! NYTIMES Presidential interview from April, published May 3, 2009, here.

Our own "jokes."

All the news that fits we print...here's more!

Unprecedented: Reconciliation ought not to be used for controversial, sweeping legislation.
NATIONAL REVIEW ONLINE, www.nationalreview.com
Michael G. Franc
March 2, 2010 4:00 A.M.

With the dust settled on the health summit, it is clear that the president and his allies on Capitol Hill intend to plow forward with their sweeping proposal to overhaul the nation’s health sector. As the Los Angeles Times observed, it is also clear that “they will have to do it by themselves.”

And there’s only one way they can “do it by themselves”: an arcane budgetary procedure known as “reconciliation.” Reconciliation lets lawmakers “expedite” consideration of proposals to reduce projected budget deficits, and it allows Senate leaders to circumvent the filibuster — which normally enables a determined minority of 41 or more senators to block legislation. Under reconciliation, a simple majority rules the Senate.

Speculation that Senate Majority Leader Harry Reid will advance Obamacare in this manner has incited fevered debate over the procedure itself. Is it appropriate to use reconciliation on such a controversial and consequential bill?

Senator Reid says it is. He argues that the reconciliation process has been used many times over the last three decades — usually, he claims, at the instigation of Republicans. House Majority Whip Rep. James Clyburn (D., S.C.) chimes in that reconciliation “is a normal thing to do in the Congress. It’s just simply a majority vote. It is nothing out of the ordinary.” Sen. Barbara Boxer (D., Calif.) characterizes reconciliation simply as “the way to govern with a majority.”

The Congressional Research Service reports that 19 reconciliation measures have been enacted into law since the procedure’s first use in the twilight of the Carter administration. It was attempted, but failed, a couple of times more. Reconciliation has been used for virtually all imaginable scenarios — save one: There is no precedent for using it to enact a once-in-a-generation rewrite of the relationship between Americans and their government that appeals exclusively to one side of the aisle.

Even the current Senate concurs that reconciliation ought not to be used for such mega-bills. Last April, 67 senators — including 26 Democrats and then-Republican Arlen Specter of Pennsylvania — supported a resolution to prohibit reconciliation from being used to advance that other mega-bill lurking out there, the cap-and-trade climate-control bill.

Our custom has always been to subject such bigger-than-life bills to a rigorous vetting process that allows affected parties to scrutinize the pros and cons and examine alternatives before ultimately arriving at a broad and bipartisan consensus. For good or ill, this process produced such landmark legislation as our civil-rights laws, Medicare and Medicaid, the Clean Air Act, the North American Free Trade Agreement, welfare reform, and the Kemp-Roth tax cuts. On final reading, each of these legislative milestones received over 60 votes in the Senate and a comparable majority in the House.

NO PARTISAN PATTERN

“The party of reconciliation,” Sen. Sheldon Whitehouse (D., R.I.) maintains, “is the Republican party.” Not so. Past reconciliation actions reveal absolutely no pattern in this regard.

With reconciliation, it takes two branches to tango — Congress and the president. In its first use (1980), a defeated Pres. Jimmy Carter and a lame-duck Democratic Congress pushed through a modest package of tax hikes and spending cuts. Since then, reconciliation bills have been enacted under every conceivable combination of Republican and Democratic control.

All seven reconciliation bills enacted on President Reagan’s watch, for example, required the cooperation of a Democratic-controlled House. And after the Democrats regained control of the Senate in 1987, the Gipper negotiated a reconciliation measure with an entirely Democratic Congress. Similarly, the first President Bush negotiated two reconciliation packages with Congresses controlled entirely by Democrats (in 1989 and 1990). His Democratic successor, Bill Clinton, negotiated a reconciliation measure with a Democratic-controlled Congress in 1993.

After the 1994 elections ushered in Republican majorities in the House and Senate, Clinton partnered with his new adversaries on three reconciliation bills. In 1997, he signed two reconciliation measures that cut taxes by $80 billion and spending by nearly $110 billion. Pres. George W. Bush worked with Republican-controlled Congresses on four reconciliation measures, including his dramatic tax cuts of 2001 and 2003. In 2007, he reached agreement on a relatively minor reconciliation measure with the newly elected Democratic majority led by Speaker Nancy Pelosi and Majority Leader Reid.

If you can decipher a pattern here, please let me know.

CONSEQUENTIAL AND POPULAR

In keeping with the American tradition of demanding that consequential legislation enjoy broad bipartisan consensus, the most ambitious reconciliation bills of the past have been widely popular on both sides of the aisle. In these cases, reconciliation was used for procedural reasons, not to force through a bill that couldn’t get 60 votes.

Consider President Reagan’s 1981 package of domestic-spending cuts, the so-called Gramm-Latta bill. It remains the bête noire of liberal acolytes of the welfare state. And that’s understandable. The measure reduced spending by $130 billion over three years on a wide array of federal domestic programs, including food stamps, Medicaid, dairy price supports, and even Social Security. Thirty years ago, $130 billion was real money. But though the Gramm-Latta spending cuts spiked the blood pressure in liberal salons and on the editorial pages of the New York Times, the tone was decidedly different on Capitol Hill. The cuts ultimately sailed through Tip O’Neill’s House on a voice vote. (Yes, a voice vote!) The legislation won an 80-vote majority in the Senate, including the support of 31 Democrats.

The 1996 rewrite of our welfare laws, also a reconciliation measure, prompted similar paroxysms of moral outrage and dire predictions from liberals. Sen. Daniel Patrick Moynihan assailed the reforms as “the most brutal act of social policy since Reconstruction” and predicted that “those involved will take this disgrace to their graves.” In fact, welfare reform proved to be the single most successful social-policy reform in decades. It garnered 328 votes in the House (98 of them from Democrats) and 78 in the Senate (25 from Democrats).

The two reconciliation measures negotiated between President Clinton and the Republican Congress in 1997 set in motion the economic boom of the late 1990s. They, too, attracted huge, bipartisan majorities. Eighty-five senators, including all but three Democrats, supported a package containing $118 billion in spending cuts. An even larger majority — 92 senators, including 37 Democrats — signed on to a reconciliation tax-cut package that included the $500 per child tax credit and a significant reduction in the top rate on capital gains. In the House, the support was similarly overwhelming: 346 votes for the spending cuts (including 153 Democrats) and 389 for the tax cuts (including 164 Democrats).

CONSEQUENTIAL AND CONTROVERSIAL

Several times in our history, reconciliation bills were both truly consequential and controversial. Here, the protections granted under the reconciliation process (i.e., requiring a simple majority for passage in the Senate) were absolutely essential.

As a general rule, reconciliation measures that raised taxes inspired considerable opposition.

In 1982, President Reagan agreed to rescind about $98 billion of the Kemp-Roth tax cuts from the previous year. That move prompted 47 senators (most of them Democrats) to oppose him, thus necessitating reconciliation. Then, in 1990, the first President Bush violated his “read my lips, no new taxes” pledge and worked closely with a Democratic congress to enact $137 billion in tax hikes via the infamous 1990 budget reconciliation bill. It incited years of Republican fratricide and sowed the seeds of the Gingrich Revolution of 1994.

But, while the margins on final passage for both bills were quite narrow, the coalitions for and against them were decidedly bipartisan. That’s a marked and critical difference from the current situation regarding health care.

That leaves three reconciliation battles that were both high-stakes and highly partisan: President Clinton’s tax increase of 1993; the Gingrich Revolution’s pivotal package of tax and spending cuts in 1995; and the acceleration in 2003 of Pres. George W. Bush’s signature tax cuts.

In perhaps the closest analogy to today’s showdown over health reform, Pres. Bill Clinton proposed in 1993 what may still be the largest tax increase in history — a cool quarter-trillion dollars over five years. This tax hike turned out to be downright radioactive. The House passed it by the narrowest of margins, with a mere 218 votes. In the upper chamber, a bipartisan coalition of 50 senators (all 44 Republicans plus 6 Democrats) stood in opposition. Vice President Al Gore took a dramatic trip down Pennsylvania Avenue to cast the tie-breaking vote.

Ultimately, the process allowed a unified bloc of Democrats in the White House and on Capitol Hill to prevail. But the precedent cannot be reassuring to today’s Democratic leaders. Anyone remember the 1994 elections?

Buoyed by its historic success in those elections, the new Republican congressional majority bet the ranch on an equally historic reconciliation package. This one would downsize the federal government — cutting spending by $894 billion, slashing taxes by nearly $250 billion, and enacting sundry other reforms such as overhauling farm programs and opening up the Arctic National Wildlife Refuge to oil and gas drilling.

This exercise proved to be too much for our political system. President Clinton and his party resisted, prompting two government shutdowns and a presidential veto. The Congressional Quarterly concluded that “the new majority seemed to cram several years of work into one when crafting the reconciliation package, but at the end of that one year they had little to show for it.”

Lesson: If you’re going to ram through a mind-boggling package of spending and tax cuts, make sure your party controls both ends of Pennsylvania Avenue.

That is precisely what happened in 2001 and again two years later. Few recall now that in 2001, President Bush’s tax-cut agenda passed with respectable bipartisan support, including 28 House and 12 Senate Democrats. The 2003 package accelerating these cuts, however, was too much for the Democrats. Theatrics ensued, and another vice president had to venture into the Senate chamber to break a 50-50 deadlock.

This time, the political fallout was quite different. President Bush and his fellow Republicans actually prospered at the polls in the 2004 presidential election.

Reconciliation can yield political dividends, it seems. But only when it’s used to force through controversial and consequential tax cuts.

— Michael G. Franc is vice president of government relations for the Heritage Foundation.

Ungovernable? Nonsense.
This isn’t structural failure; this is the system working the way it’s supposed to.
National Review
February 19, 2010 12:00 A.M.

In the latter days of the Carter presidency, it became fashionable to say that the office had become unmanageable and was simply too big for one man. Some suggested a single, six-year presidential term. The president’s own White House counsel suggested abolishing the separation of powers and going to a more parliamentary system of unitary executive control. America had become ungovernable.

Then came Ronald Reagan, and all that chatter disappeared.

The tyranny of entitlements? Reagan collaborated with Tip O’Neill, the legendary Democratic House speaker, to establish the Alan Greenspan commission that kept Social Security solvent for a quarter-century.

A corrupted system of taxation? Reagan worked with liberal Democrat Bill Bradley to craft a legislative miracle: tax reform that eliminated dozens of loopholes and slashed rates across the board — and fueled two decades of economic growth.

Later, a highly skilled Democratic president, Bill Clinton, successfully tackled another supposedly intractable problem: the culture of intergenerational dependency. He collaborated with another House speaker, Newt Gingrich, to produce the single most successful social reform of our time, the abolition of welfare as an entitlement.

It turned out that the country’s problems were not problems of structure but of leadership. Reagan and Clinton had it. Carter didn’t. Under a president with extensive executive experience, good political skills, and an ideological compass in tune with the public’s, the country was indeed governable.

It’s 2010, and the first-year agenda of a popular and promising young president has gone down in flames. Barack Obama’s two signature initiatives — cap-and-trade and health-care reform — lie in ruins.

Desperate to explain away this scandalous state of affairs, liberal apologists haul out the old reliable from the Carter years: “America the Ungovernable.” So declared Newsweek. “Is America Ungovernable?” coyly asked The New Republic. Guess the answer.

The rage at the machine has produced the usual litany of systemic explanations. Special interests are too powerful. The Senate filibuster stymies social progress. A burdensome constitutional order prevents innovation. If only we could be more like China, pines Tom Friedman, waxing poetic about the efficiency of the Chinese authoritarian model and complaining that America can only flail about under its “two parties . . . with their duel-to-the-death paralysis.” The better thinkers, bewildered and furious that their president has not gotten his way, have developed a sudden disdain for our inherently incremental constitutional system.

Yet, what’s new about any of these supposedly ruinous structural impediments? Special interests blocking policy changes? They have been around since the beginning of the republic — and, since the beginning of the republic, strong presidents, such as the two Roosevelts, have rallied the citizenry and overcome them.

And then, of course, there’s the filibuster, the newest liberal bête noire. “Don’t blame Mr. Obama,” writes Paul Krugman of the president’s failures. “Blame our political culture instead. . . . And blame the filibuster, under which 41 senators can make the country ungovernable.”

“Ungovernable,” once again. Of course, it seems like just yesterday that the same Paul Krugman was warning about “extremists” trying “to eliminate the filibuster” when Democrats used it systematically to block one Bush (43) judicial nomination after another. Back then, Democrats touted it as an indispensable check on overweening majority power. Well, it still is. Indeed, the Senate, with its ponderous procedures and decentralized structure, is serving precisely the function the Founders intended: as a brake on the passions of the House and a check against precipitous transformative change.

Leave it to Mickey Kaus, a principled liberal who supports health-care reform, to debunk these structural excuses: “Lots of intellectual effort now seems to be going into explaining Obama’s (possible/likely/impending) health care failure as the inevitable product of larger historic and constitutional forces. . . . But in this case there’s a simpler explanation: Barack Obama’s job was to sell a health care reform plan to American voters. He failed.”

He failed because the utter implausibility of its central promise — expanded coverage at lower cost — led voters to conclude that it would lead ultimately to more government, more taxes, and more debt. More broadly, the Democrats failed because, thinking the economic emergency would give them a political mandate and a legislative window, they tried to impose a left-wing agenda on a center-right country. The people said no, expressing themselves first in spontaneous demonstrations, then in public-opinion polls, then in elections — Virginia, New Jersey, and, most emphatically, Massachusetts.

That’s not a structural defect. That’s a textbook demonstration of popular will expressing itself — despite the special interests — through the existing structures. In other words, the system worked.

— Charles Krauthammer is a nationally syndicated columnist. © 2010, The Washington Post Writers Group.

Feeling Lucky?
Weekly Standard
BY William Kristol
February 22, 2010, Vol. 15, No. 22

Yankees pitcher Lefty Gomez was a 20-game winner four times in the 1930s. He led the league twice in wins, winning percentage, and ERA, and three times in shutouts and strikeouts. He was an awfully good pitcher. But he always said, “I’d rather be lucky than good.” It’s best to be both. But if the Obama administration continues to resist being good at national security policy, we need to hope they—and we—remain lucky.

Despite a systemic counter-terrorism failure, Umar Farouk Abdulmutallab failed to detonate his bomb. That was lucky.

Despite a perverse attempt to side with our enemies in Honduras, the Honduran people ignored us and ended up with a decent and democratic—and friendly—government. That was lucky.

Despite a foolish overhyping of the possibilities of an agreement between Israel and the Palestinians, and an unseemly inclination to badger our close ally, nothing too damaging has happened on the ground in the region. That was lucky.

One could go on. And one could even argue that Scott Brown’s victory in Massachusetts was an insistence of Obama luck. By killing health care (assuming it did), it may have averted a massive outpouring of voter anger that Democrats would have faced in November as a result of having forced health care down our throats. Now the issue may recede sufficiently, and if the economy comes back in the short term—partly thanks to the death of Obama’s health care and cap and trade proposals—Democrats may only have a bad, rather than awful, election year. And that would be lucky.

But the real stroke of luck would be regime change in Iran. It’s the only alternative to either a jihadist regime with nuclear weapons, or war. The administration has been pathetically timid with respect to Iran. It can’t bring itself to do the smallest things to support the Iranian dissidents. But the Green revolution could still prevail.

It sometimes works this way: the hard and controversial work of a prior administration—Ronald Reagan’s in taking on the Soviet Union, George W. Bush’s in beginning the task of changing the Middle East—isn’t reversed by its successor. The effort still has momentum. And the big change then happens on the successor’s watch.

So if Obama doesn’t throw away our achievements in Iraq, if he perseveres in Afghanistan, if he doesn’t entirely turn his back on the freedom doctrine for the Middle East—then the Iranian people have a chance to prevail, even without a champion in the White House.

But it would be easier if they had a champion.

Some in Congress are stepping up. The death last week of Charlie Wilson is a reminder of the difference that members of Congress can make. Most accounts of how the Soviet Union was brought down tend to emphasize the Reagan defense buildup and the Strategic Defense Initiative, the deployment of the Pershings, Reagan’s moral and political support for dissidents, and his rhetorical assault on the evil empire. These were important. But one shouldn’t forget our aid to those fighting against the Soviet army in Afghanistan—and the impact in the Soviet Union of the forced withdrawal. That aid began in the Carter presidency and was spearheaded by Charlie Wilson.

It’s not clear Congress could do anything so dramatic for the Iranian protestors. But the legislation introduced last week by Senators John Cornyn and Sam Brownback at least pushes in the right direction. “The Iran Democratic Transition Act” would support—rhetorically and financially—efforts by Iranian opposition groups to remove the regime in Tehran and pave the way for a free and democratic government in Iran.

President Obama said early last week that he had “bent over backwards” to engage Iran. So he has. We’re lucky we haven’t paid a heavier price for this foolish policy. One that seems to have been driven by an odd combination of vanity and weakness. It would be good if the president now stood up straight and put the American government unambiguously and energetically on the side of the Iranians demonstrating against a dictatorship.

With all due respect to Lefty Gomez, and to the admittedly large role of fortune in human affairs—it’s nice to be lucky, but it’s safer to be strong.

—William Kristol

Where the U.S. went wrong on the Christmas Day bomber
From the Washington Post
By Michael B. Mukasey
Friday, February 12, 2010; A27

It seems to me unlikely that Umar Farouk Abdulmutallab will be known to future generations of lawyers for generating any groundbreaking legal principle or issue. But when it comes to illuminating our public discourse about the "global war on terror," he is right up there with Clarence Earl Gideon, Ernesto Miranda or even Jose Padilla. His case presents in one tidy package virtually all the issues that arise from the role intelligence plays in this struggle and compels us to examine what the law requires and what it doesn't.

When Abdulmutallab tried to detonate a bomb concealed in his undershorts, he committed a crime; no doubt about that. He could not have acted alone; no doubt about that either. The bomb was not the sort of infernal device readily produced by someone of his background, and he quickly confirmed that he had been trained and sent by al-Qaeda in Yemen.

What to do and who should do it? It was entirely reasonable for the FBI to be contacted and for that agency to take him into custody. But contrary to what some in government have suggested, that Abdulmutallab was taken into custody by the FBI did not mean, legally or as a matter of policy, that he had to be treated as a criminal defendant at any point. Consider: In 1942, German saboteurs landed on Long Island and in Florida. That they were eventually captured by the FBI did not stop President Franklin Roosevelt from directing that they be treated as unlawful enemy combatants. They were ultimately tried before a military commission in Washington and executed. Their status had nothing to do with who held them, and their treatment was upheld in all respects by the Supreme Court.

If possible, FBI custody is even less relevant today in determining someone's status. In 1942 the FBI was exclusively a crime-fighting organization. After Sept. 11, 2001, the agency's mission was expanded beyond detection of crime and apprehension of criminals to include gathering intelligence, helping to prevent and combat threats to national security, and furthering U.S. foreign policy goals. Guidelines put in place in 2003 and revised in September 2008 "do not require that the FBI's information gathering activities be differentially labeled as 'criminal investigations,' 'national security investigations,' or 'foreign intelligence collections,' or that the categories of FBI personnel who carry out investigations be segregated from each other based on the subject areas in which they operate. Rather, all of the FBI's legal authorities are available for deployment in all cases to which they apply to protect the public from crimes and threats to the national security and to further the United States' foreign intelligence objectives."

"As with criminal investigations generally, detecting and solving the crimes, and eventually arresting and prosecuting the perpetrators, are likely to be among the objectives of investigations relating to threats to the national security. But . . . other measures needed to protect the national security . . . may include . . . providing threat information and warnings to other federal . . . agencies and entities; diplomatic or military actions; and actions by other intelligence agencies to counter international terrorism or other national security threats."

Contrary to what the White House homeland security adviser and the attorney general have suggested, if not said outright, not only was there no authority or policy in place under the Bush administration requiring that all those detained in the United States be treated as criminal defendants, but relevant authority was and is the opposite. The Supreme Court held in Hamdi v. Rumsfeld that "indefinite detention for the purpose of interrogation is not authorized" but also said in the same case that detention for the purpose of neutralizing an unlawful enemy combatant is permissible and that the only right of such a combatant -- even if he is a citizen, and Abdulmutallab is not -- is to challenge his classification as such a combatant in a habeas corpus proceeding. This does not include the right to remain silent or the right to a lawyer, but only such legal assistance as may be necessary to file a habeas corpus petition within a reasonable time. That was the basis for my ruling in Padilla v. Rumsfeld that, as a convenience to the court and not for any constitutionally based reason, he had to consult with a lawyer for the limited purpose of filing a habeas petition, but that interrogation need not stop.

What of Richard Reid, the "shoe bomber," who was warned of his Miranda rights and prosecuted in a civilian court? He was arrested in December 2001, before procedures were put in place that would have allowed for an outcome that might have included not only conviction but also exploitation of his intelligence value, if possible. His case does not recommend the same procedure in Abdulmutallab's.

The struggle against Islamist extremists is unlike any other war we have fought. Osama bin Laden and those like-minded intend to make plain that our government cannot keep us safe, and have sought our retreat from the Islamic world and our relinquishment of the idea that human rather than their version of divine law must control our activities. This movement is not driven by finite grievances or by poverty. The enemy does not occupy a particular location or have an infrastructure that can be identified and attacked but, rather, lives in many places and purposely hides among civilian populations. The only way to prevail is to gather intelligence on who is doing what where and to take the initiative to stop it.

There was thus no legal or policy compulsion to treat Abdulmutallab as a criminal defendant, at least initially, and every reason to treat him as an intelligence asset to be exploited promptly. The way to do that was not simply to have locally available field agents question him but, rather, to get in the room people who knew about al-Qaeda in Yemen, people who could obtain information, check that information against other available data and perhaps get feedback from others in the field before going back to Abdulmutallab to follow up where necessary, all the while keeping secret the fact of his cooperation. Once his former cohorts know he is providing information, they can act to make that information useless.

Nor is it an answer to say that Abdulmutallab resumed his cooperation even after he was warned of his rights. He did that after five weeks, when his family was flown here from Nigeria. The time was lost, and with it possibly useful information. Disclosing that he had resumed talking only compounded the problem by letting his former cohorts know that they had better cover their tracks.

The writer was U.S. attorney general from 2007 to 2009 and the presiding judge at initial proceedings against Jose Padilla in 2002.

The Real Obama: The man behind the "postpartisan" curtain
Weekly Standard
BY Matthew Continetti
February 1, 2010, Vol. 15, No. 19

What does the Massachusetts special election tell us about President Obama? Nothing good. Scott Brown’s victory over Martha Coakley not only ended the Democrats’ filibuster-proof Senate majority. It also exposed as false the White House’s preferred storyline about the president’s ideology, capacities, and temperament—what you might call the Obama Myth.

The Obama Myth rests on three assumptions: (a) Obama is a nonideological pragmatist; (b) Obama is an uncommonly powerful communicator; and (c) Obama has a gut connection with the people. All three are wrong. Only the Democrats’ fantasy that opposition to their agenda is limited to a lunatic fringe has blinded them from seeing the president’s liabilities. Let’s open their eyes.

The False Pragmatist

Obama campaigned on a bipartisan platform of post-ideological problem-solving. The label has stuck: Joe Biden has referred to Obama as a “clear-eyed pragmatist”; David Brooks says the president suffers from a “voracious pragmatism.”

All of which might be true—if by “pragmatist” they mean a committed liberal who is willing to sign legislation passed by razor-thin, partisan margins. The stimulus became law with only three Republican votes—and one of those Republicans is now a Democrat. The House passed cap and trade with the support of only eight Republicans; the legislation is dead in the Senate. Health care got a single Republican vote.

Besides some aspects of education reform and the surge in Afghanistan, it is difficult to name a single conservative idea the president has co-opted. You sometimes get the impression that Obama truly believes in the strawmen he parades before the public: those wraith-like Republicans who want to “do nothing” when it comes to health care, the financial system, and the budget. Is he unaware that conservative think tanks and journals regularly propose reforms in these and other areas?

No, Obama’s problem is with the content of conservative proposals—for they tend to rely on decentralized markets and give economic growth priority over equity. Obama hasn’t dismissed conservatives because they lack ideas. He’s dismissed them because conservative ideas do not meet his ideological commitments.

The Not-so-Great Communicator

“Obama is the Democrats’ Great Communicator, our Ronald Reagan,” the editor of Salon wrote in February 2009. A year later, that no longer seems to be the case (if it ever was). Again and again, the president has tried to persuade or cajole audiences to follow his lead. No such luck.

Forget about persuading Republicans—Obama doesn’t try, and most of them aren’t interested anyway. What about independents? Ask Creigh Deeds, Jon Corzine, and Martha Coakley. These three share at least two things: The president campaigned for all of them, and they all lost. Independents abandoned them in droves.

Democrats would like to pretend that Obama has not been a factor in the three statewide elections since he assumed office. And, granted, there were other issues in play. None of the candidates was particularly strong. Unemployment is at 10 percent. Nevertheless, “our Ronald Reagan” told Democrats and independents in all three states that his agenda would be imperiled if Republicans won. And in all three, those voters greeted his dulcet tones with a collective shrug.

Persuasive? In 2009 the president gave dozens of televised townhall meetings, speeches, and press conferences to muster support for the Democratic health care reform. Yet none of this frenetic activity did anything to improve the public’s opinion of his approach to health care. Quite the reverse: Opposition to the plan has increased.

The “international community” was also supposed to fall under Obama’s spell. Maybe that’s true, in some places. Not in Copenhagen. The president went there twice, to campaign for the 2016 Olympic games to come to Chicago and for a global treaty on climate change. He was denied both times. And don’t forget the deafness of Russia, China, North Korea, and Iran to Obama’s words, as well.

The Lecturer in Chief

In endorsing Obama for president, the Washington Post editorialized that he is “a man of supple intelligence, with a nuanced grasp of complex issues” whose “temperament is unlike anything we’ve seen on the national stage in many years.” True enough: Obama is cool, unflappable, intellectual. And yet the personality traits that made him attractive to so many as a candidate have not worn well as president.

Since 2008, there have been three moments when the man-of-the-people looked more like the lecturer-from-Hyde Park. The first was during the campaign, when Obama famously told fundraisers in San Francisco that the folks in “small towns in Pennsylvania” can “get bitter” and “cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations.” The speech was pure liberal condescension.

Then there was Obama’s July 2009 remark that the Cambridge police had behaved “stupidly” when they arrested Harvard professor Henry Louis Gates on the porch of his own home. The public reaction to his comment, which tripped over race, class, and educational lines, forced the president to call his hastily arranged “beer summit” at the White House, with Gates, Officer Joe Crowley, and Biden as props. Ironically, it was probably Obama’s most successful summit.

More recently, when Obama appeared alongside Martha Coakley at a last-minute rally in Boston, the president ridiculed Scott Brown’s pickup truck: “Forget the truck,” he said at one point. “Everybody can buy a truck.” This isn’t the case, of course, as Brown pointed out the next day. In the Massachusetts campaign, Brown’s truck became a metaphor for his scrappy, can-do, underdog attitude. Obama mocked it and therefore became the voice of entrenched power.

Obama has fallen into a trap that ensnares many intelligent people. He is so convinced of his opinions that he dismisses all contrary thinking as bizarre, dishonest, or fake. In the liberal worldview, Brown is a phony, opposition to health care reform is based on lies or callousness, the Tea Party activists are nuts, racists, or worse, and the solution to most public policy issues can be found only in more regulation, more bureaucrats, and more centralized power.

In the liberal worldview, Scott Brown’s victory is not a signal that Democrats have overreached. It is that the American people are “angry” and “don’t understand” all the good liberals are trying to do for them. “The same thing that swept Scott Brown into office swept me into office,” Obama told George Stephanopoulos last week, as if the American people are a bunch of emotional basket cases who have no grasp of public policy and no ability to distinguish between Bush Republicans and Obama Democrats.

And there you have another incorrect assumption that is key to the Obama Myth. Question is, will Obama and the Democrats learn their lesson? Or will the people be forced to give them another in November?

Op-Ed Columnist
Politics in the Age of Distrust
NYTIMES
By DAVID BROOKS
January 22, 2010

In November 2008, William A. Galston and Elaine C. Kamarck wrote a report called “Change You Can Believe In Needs a Government You Can Trust.” Galston and Kamarck, who served in senior positions in the Clinton administration, threw up some warning flags for the incoming Obama administration.

Despite the Democratic triumph that month, they noted, public distrust of government remains intensely high. Historically, it has been nearly impossible to pass major domestic reforms in the face of that kind of distrust. Therefore, they counseled, the new administration should move cautiously to rebuild trust before beginning a transformational agenda.

The Obama administration interpreted the political climate in an entirely different way. As John F. Harris and Carol E. Lee wrote in a smart piece in Politico on Wednesday, the administration interpreted the 2008 election as a rejection of not only George W. Bush-style conservatism, but also Bill Clinton-style moderation. The country was ready for a New Deal-size change. It had a leader in Barack Obama who could uniquely inspire a national transformation.

As happens every four years, hubris defeated caution, and the administration began its big-bang approach.

As always, it backfired. Instead of building trust in government, the Democrats have magnified distrust. The country already believed Washington is out of touch with its core concerns. So while most families were concerned about jobs, Democrats in Washington spent nine months arguing about health care. The country was already tired of self-serving back-room deals, so the Democrats negotiated a series of dirty deals with the pharmaceutical industry, the unions and certain senators. Americans already felt Washington doesn’t understand their fears and insecurities. So at the moment when economic insecurity was at its peak, the Democrats in Washington added another layer of insecurity by threatening to change everything at once.

Instead of building a new majority, the Democrats have set off a distrust insurrection (which is not the same as a conservative insurrection). Republicans are enraged. Independents are furious. Democrats are disheartened. Health care reform is brutally unpopular. Even voters in Massachusetts decided it was time to send a message.

The Democrats now have four bad options. The first is what you might call the Heedless and Arrogant Approach. A clear majority of Americans are against the Congressional health care reform plan. Democrats could say: We know this is unpopular, but we think it is good policy and we are going to ram it through and you voters can judge us by the results.

The second route is what you might call the Weak and Feckless Approach. Democrats could say: We have received and respect the message voters are sending. We are not going to shove the biggest social transformation in a generation down the throats of a country that has judged and rejected it. We are not going to concentrate immense new powers in a Washington the country detests.

Instead, we will regroup and reorganize. Perhaps we will try incremental reforms. Perhaps we will use federal money to support a series of state reform efforts — like the one in Massachusetts — which are closer to the people. (In 2007, Russ Feingold, a Democrat, and Lindsey Graham, a Republican, co-sponsored the State-Based Health Care Reform Act to spark this kind of local experimentation.)

The third approach is the Dangerous and Demagogic Approach. This begins with the presumption that what Americans really want is a bunch of pseudopopulists to tell them they can have everything for free. This would mean stripping the health bills of anything that might be unpopular — like Medicare cuts and tax increases — and passing the rest regardless of the cost.

The fourth approach is the Incoherent and Internecine Approach. This would involve settling on no coherent policy but just blaming each other for cowardice and stupidity for the next month. Liberals, who make up 20 percent of the country, could complain because they didn’t get their version of reform. The Senate and the House could bash each other. The intelligentsia could bash the public.

Right now, Incoherent and Internecine is winning, but the hard choice is between the first two approaches. Galston, ironically, now supports Heedless and Arrogant. It was a mistake to rush into health care, he believes, but now that the party is down the road it would be suicide to turn back. Democrats should stand for what they believe in. If the policy works, then public trust will follow.

I support the Weak and Feckless Approach. Trust is based on mutual respect and reciprocity. If, at this moment of rage and cynicism, the ruling class goes even further and snubs popular opinion, then that will set off an ugly, destructive, and yet fully justified popular rebellion. Trust in government will be irrevocably broken. It will decimate policy-making for a generation.

These are the choices ahead. Have a nice day.

Op-Ed Contributor
Taxing Wall Street Down to Size
NYTIMES
By DAVID STOCKMAN
January 20, 2010

WHILE supply-side catechism insists that lower taxes are a growth tonic, the theory also argues that if you want less of something, tax it more. The economy desperately needs less of our bloated, unproductive and increasingly parasitic banking system. In this respect, the White House appears to have gone over to the supply side with its proposed tax on big banks, as it scores populist points against the banksters, too.

Not surprisingly, the bankers are already whining, even though the tax would amount to a financial pinprick — a levy of only 0.15 percent on the debts (other than deposits) of the big financial conglomerates. Their objections are evidence that the administration is on the right track.

Make no mistake. The banking system has become an agent of destruction for the gross domestic product and of impoverishment for the middle class. To be sure, it was lured into these unsavory missions by a truly insane monetary policy under which, most recently, the Federal Reserve purchased $1.5 trillion of longer-dated Treasury bonds and housing agency securities in less than a year. It was an unprecedented exercise in market-rigging with printing-press money, and it gave a sharp boost to the price of bonds and other securities held by banks, permitting them to book huge revenues from trading and bookkeeping gains.

Meanwhile, by fixing short-term interest rates at near zero, the Fed planted its heavy boot squarely in the face of depositors, as it shrank the banks’ cost of production — their interest expense on depositor funds — to the vanishing point.

The resulting ultrasteep yield curve for banks is heralded, by a certain breed of Wall Street tout, as a financial miracle cure. Soon, it is claimed, a prodigious upwelling of profitability will repair bank balance sheets and bury toxic waste from the last bubble’s collapse. But will it?

In supplying the banks with free deposit money (effectively, zero-interest loans), the savers of America are taking a $250 billion annual haircut in lost interest income. And the banks, after reaping this ill-deserved windfall, are pleased to pronounce themselves solvent, ignoring the bad loans still on their books. This kind of Robin Hood redistribution in reverse is not sustainable. It requires permanently flooding world markets with cheap dollars — a recipe for the next bubble and financial crisis.

Moreover, rescuing the banks yet again, this time with a steeply sloped yield curve (that is, cheap short-term money and more expensive long-term rates), is not even a proper monetary policy action. It is a vast and capricious reallocation of national income, which would be hooted down in the halls of Congress, were it properly brought to a vote.

National economic policy has come to this absurd pass because for decades the Fed has juiced the banking system with excessive reserves. With this monetary fuel, the banks manufactured, aggressively at first and then recklessly, a tide of new loans and deposits. When Wall Street’s “heart attack” struck in September 2008, bank liabilities had reached 100 percent of gross domestic product — double the ratio of a few decades earlier.

This was a measurement of the perilous extent to which bad investments, financed by debt, had come to distort the warp and woof of the economy. Behind the worthless loans stands a vast assemblage of redundant housing units, shopping malls, office buildings, warehouses, tanning salons and fast food restaurants. These superfluous fixed assets had, over the past decade, given rise to a hothouse economy of jobs that have now vanished. Obviously, the legions of brokers, developers, appraisers, contractors, tradesmen and decorators who created the bad investments are long gone. But now the waitresses, yoga instructors, gardeners, repairmen, sales clerks, inventory managers, office workers and lift-truck drivers once thought needed to work at these places are disappearing into the unemployment statistics, as well.

The baleful reality is that the big banks, the freakish offspring of the Fed’s easy money, are dangerous institutions, deeply embedded in a bull market culture of entitlement and greed. This is why the Obama tax is welcome: its underlying policy message is that big banking must get smaller because it does too little that is useful, productive or efficient.

To argue, as some conservatives surely will, that a policy-directed shrinking of big banking is an inappropriate interference in the marketplace is to miss a crucial point: the big Wall Street banks are wards of the state, not private enterprises. During recent quarters, for instance, the preponderant share of Goldman Sachs’ revenues came from trading in bonds, currencies and commodities.

But these profits were not evidence of Mr. Market doing God’s work, greasing the wheels of commerce and trade by facilitating productive financial transactions. In fact, they represented the fruits of hyperactive gambling in the Fed’s monetary casino — a place where the inside players obtain their chips at no cost from the Fed-controlled money markets, and are warned well in advance, by obscure wording changes in the Fed’s policy statements, about any pending shift in the gambling odds.

To be sure, the most direct way to cure the banking system’s ills would be to return to a rational monetary policy based on sensible interest rates, an end to frantic monetization of federal debt and a stable exchange value for the dollar. But Ben Bernanke, the Fed chairman, and his posse are not likely to go there, believing as they do that central banking is about micromanaging aggregate demand — asset bubbles and a flagging dollar be damned. Still, there can be no doubt that taxing big bank liabilities will cause there to be less of them. And that’s a start.

Health 'reform' vs. the Constitution
NYPOST
By GEORGE F. WILL
Last Updated: 7:41 AM, January 16, 2010
Posted: 12:31 AM, January 16, 2010

Although Democrats think their health-care legislation faces smooth sailing to implementation, there is a rock dead ahead -- a constitutional challenge to the legislation's core. Democrats who assume it is constitutional to make it mandatory for Americans to purchase health insurance should answer some questions:

Would it be constitutional for the government to legislate compulsory calisthenics for all Americans? If not, why not? If it would be, in what sense does the nation still have constitutional, meaning limited, government?

Supporters of the mandate say Congress can impose it under the enumerated power to regulate interstate commerce. Since the New Deal, courts have made this power capacious enough to include regulating intrastate activity that "substantially affects" interstate commerce. Hence Congress could constitutionally ban racial discrimination in "public accommodations" -- restaurants, motels, etc. -- as an impediment to interstate commercial activity.

Opponents of the mandate say: Unless the Commerce Clause is infinitely elastic -- in which case, Congress can do anything -- it does not authorize Congress to forbid the inactivity of not making a commercial transaction, of not purchasing a product (health insurance) from a private provider.

"Congress can regulate commercial activities in which people choose to engage, but cannot require that they engage in those commercial activities." So says Sen. Orrin Hatch, who also notes that if Congress can mandate particular purchases in order to help the economy, there was no need for Cash for Clunkers: Congress could have ordered people to buy cars (with subsidies, if necessary). Why not the Anti-Couch Potato Act To Make Calisthenics Mandatory and To Impose a $50 Excise Tax on Cheeseburgers Because Unhealthy Lifestyles Affect Interstate Commerce?

Many liberals, says Hatch, spent eight years insisting that "the Constitution sets definite and objective limits that the president must obey." There are, however, no constitutional controls on Congress if there are no limits on its power to declare all its preferences "necessary and proper" for the regulation of commerce.

Stuart Taylor, a judicious analyst of legal matters, says (in National Journal) that the Supreme Court probably would uphold the constitutionality of the mandate, for two reasons: Because uninsured people create substantial economic effects by seeking free care from emergency rooms. And because the mandate is, in Congress' judgment, "necessary and proper" for financing health-care reform.

But if any activity, or inactivity, can be declared to have economic consequences, then anything can be regulated -- or required. Furthermore, judicial review, and the Constitution itself, is largely nullified by a doctrine of virtually unlimited judicial deference to Congress' estimates of what is "necessary and proper" for the regulation of commerce.

If Congress does something beyond its constitutional powers, that something does not become constitutional merely by Congress saying it is necessary for this or that.

Taylor also says that the alternative to upholding the mandate is for the court to strike down a president's "signature initiative -- something that no court has done in 70 years, for good reason." The reason is a general duty to respect government decisions arrived at democratically.

Which brings us to what conservatives must believe in order to believe that the Supreme Court should declare the insurance mandate unconstitutional.

Judicial review -- let us be candid: judicial supervision of democracy -- troubles people who believe, mistakenly, that the Constitution's primary purpose is simply to provide the institutional architecture for democracy. Such people believe that having government by popular sovereignty is generally much more important than what government does; hence courts should be broadly deferential to preferences expressed democratically. This is the doctrine of those conservatives who deplore, often with more vigor than precision, "judicial activism."

More truly conservative conservatives take their bearings from the proposition that government's primary purpose is not to organize the fulfillment of majority preferences but to protect pre-existing rights of the individual -- basically, liberty. These conservatives favor judicial activism understood as unflinching performance of the courts' role in that protection.

That role includes disapproving congressional encroachments on liberty that are not exercises of enumerated powers. This obligatory engagement with the Constitution's text and logic supersedes any obligation to be deferential toward the actions of government merely because they reflect popular sovereignty.

The latter kind of conservatives are more truly conservative than the former kind because they have stronger principles for resisting the conscription of individuals, at a cost of diminished liberty, into government's collective projects. So a constitutional challenge to the mandate serves two purposes: It defies a pernicious idea and clarifies conservatism.

Time to change course
NYPOST
By MICHAEL BARONE
Last Updated: 2:43 PM, January 9, 2010
Posted: 12:24 AM, January 9, 2010

A year ago, I was privileged to be one of several guests at a dinner with President- elect Obama. One thing that struck me and others, aside from his courtesy and fluency, was his air of self-confidence. The man who had risen in just four years from state senator to president of the United States seemed sure he could master the job.

I wonder if he is as sure now. It seems to me that two assumptions that Obama carried into the White House -- assumptions that were shared by many who hadn't voted for him -- have proved to be unfounded.

The first is that economic distress would lead more Americans to favor big-government policies. The second is that Obama's personal characteristics and his repudiation of many of his predecessor's policies would change the minds of America's critics and enemies.

Any doubts that these assumptions were mistaken were dispelled at Christmastime. On Christmas Eve, the Senate passed a huge health-care bill that according to every public opinion poll is opposed by most Americans. And on Christmas Day, Nigerian terrorist Umar Farouk Abdulmutallab came close to destroying an airliner nearing Detroit.

The unpopularity of the stimulus package, cap-and-trade legislation and the various health-care bills probably surprised the congressional Democratic leaders who put them together and the president who, with surprising passivity, indicated he would sign them. After all, weren't these ways to spread the wealth to ordinary people, as Obama put it to Joe the Plumber?

But through most of our history, Americans have preferred policies that enable and help them to amass wealth rather than those that purport to transfer someone else's wealth to them. The biggest outpouring of political sentiment this year came from those who thronged to "tea parties" and denounced increases in the national debt as stirringly as did the first Democratic president, Andrew Jackson, who actually paid it all off.

On foreign policy, Obama imagined that confessing past American sins, announcing the closing of Guantanamo and abandoning enhanced interrogation techniques would make Islamist terrorists think better of America. He thought he could induce the leaders of enemy nations to change their ways by referring respectfully to regimes like Iran's and downplaying all talk of human rights abuses.

It turns out that just as the financial crisis and recession didn't much change Americans' fundamental attitudes on the balance between government and markets, so emollient talk and confessions of past American sins didn't much change the behavior of those who consider America a sworn enemy. The mullahs still want their nuclear bomb.

US officials could stop talking about a "War on Terror" and speak instead of "man-caused disasters." But that didn't disarm the Islamist terrorist who shot up the recruiting station in Little Rock, Ark., or the Muslim psychiatrist who opened fire at Fort Hood or the pampered Nigerian who tried to bring down Northwest flight 253 over Detroit.

Obama did manage to abandon his statement that the Detroit bomber was an "isolated extremist" and admit that he was in touch with al Qaeda terrorists in Yemen. Yet the administration quickly sent him into the civilian-justice system, where he predictably clammed up.

We've all experienced the cognitive dissonance that comes when it turns out that the world doesn't work the way we assumed it would. It's hard to give up your assumptions and easier to believe that unexpected events were an aberration from norm that would quickly snap back to what we expected.

Midcourse corrections in these circumstances are often awkward and difficult to execute, the more so when all eyes are on you and any change in direction is the subject of universal comment and adverse criticism.

Getting elected president of the United States must be an enormously confidence-building experience: So many people wanted the job, and you got it. Being president can be more chastening when events don't turn out as you anticipated.

The great presidents -- Lincoln, FDR -- faced events no one expected and in response changed policies and priorities without ever, so far as we know, losing their nerve. Lesser presidents, including Bill Clinton and George W. Bush, did so as well. Will Barack Obama?

Op-Ed Columnist
The Obama Way
NYTIMES
By ROSS DOUTHAT
December 26, 2009

Every presidency is the subject of competing caricatures. But almost a year into his first term, there’s something particularly elusive about Barack Obama’s political identity. He’s a bipartisan bridge-builder — unless he’s a polarizing ideologue. He’s a crypto-Marxist radical — except when he’s a pawn of corporate interests. He’s a post-American utopian — or else he’s a willing tool of the national security state.

The press has churned out a new theory every week, comparing Obama to John F. Kennedy and Franklin Roosevelt, to George H. W. Bush and Jimmy Carter — to every 20th-century chief executive, it often seems, save poor, dull Gerald Ford. But none of the analogies have stuck. We’re well into the Obama era, but neither his allies nor his enemies can quite get a fix on exactly what our 44th president really represents.

Obama baffles observers, I suspect, because he’s an ideologue and a pragmatist all at once. He’s a doctrinaire liberal who’s always willing to cut a deal and grab for half the loaf. He has the policy preferences of a progressive blogger, but the governing style of a seasoned Beltway wheeler-dealer.

This is a puzzling combination, for many, because we expect our politicians’ principles to align more neatly with their approach to governing. Our deal-making Machiavels are supposed to be self-conscious “centrists” (think Ben Nelson or Arlen Specter). Our ideological liberals and conservatives are supposed to be more concerned with being right than with being ruthlessly effective.

It’s also puzzling because Obama promised exactly the opposite approach while running for the presidency. He campaigned as a postpartisan healer who would change the cynical ways of Washington — as a foe of both back-room deals and ideology-as-usual. But he’s governed as a conventional liberal who believes in the existing system, knows how to work it and accepts the limitations it imposes on him.

In hindsight, the most prescient sentence penned during the presidential campaign belongs to Ryan Lizza of The New Yorker. “Perhaps the greatest misconception about Barack Obama,” he wrote in July 2008, “is that he is some sort of anti-establishment revolutionary. Rather, every stage of his political career has been marked by an eagerness to accommodate himself to existing institutions rather than tear them down or replace them.”

Both right and left have had trouble processing Obama’s institutionalism. Conservatives have exaggerated his liberal instincts into radicalism, ignoring the fact that a president who takes advice from Lawrence Summers and Robert Gates probably isn’t a closet Marxist-Leninist. The left has been frustrated, again and again, by the gulf between Obama’s professed principles and the compromises that he’s willing to accept, and some liberals have become convinced that he isn’t one of them at all.

They’re wrong. Absent political constraints, Obama would probably side with the liberal line on almost every issue. It’s just that he’s more acutely conscious of the limits of his powers and less willing to start fights that he might lose than many supporters would prefer. In this regard, he most resembles Ronald Reagan and Edward Kennedy. Both were highly ideological politicians who trained themselves to work within the system. Both preferred cutting deals to walking away from the negotiating table.

The upside of this approach is obvious: It gets things done. Between the stimulus package, the pending health care bill and a new raft of financial regulations, Obama will soon be able to claim more major legislative accomplishments than any Democrat since Lyndon Johnson.

The downside, though, is that sometimes what gets done isn’t worth doing. The assumption that a compromised victory is better than no victory at all can produce phony achievements — like last week’s “global agreement” on climate change — and bloated, ugly legislation. And using cynical means to progressive ends (think of the pork-laden stimulus bill or the frantic vote-buying that preceded this week’s Senate health care votes) tends to confirm independent voters’ worst fears about liberal government: that it’s a racket rigged to benefit privileged insiders and a corrupt marketplace floated by our tax dollars.

At the same time, Obama doesn’t enjoy the kind of deep credibility with his base that both Reagan and Kennedy spent decades building. When Kennedy told liberals that a given compromise was the best they could get, they believed him. Whether the issue is health care or Afghanistan, Obama’s word doesn’t carry the same weight.

This leaves him walking a fine line. If Obama’s presidency succeeds, it will be a testament to what ideology tempered by institutionalism can accomplish. But his political approach leaves him in constant danger of losing center and left alike — of being dismissed by independents as another tax-and-spender, and disdained by liberals as a sellout.

How O says he's about to mislead
NYPOST
By JACOB SULLUM
Last Updated: 12:17 PM, December 19, 2009
Posted: 12:08 AM, December 19, 2009

'There are those who claim we have to choose between paying down our deficits . . . and investing in job creation and economic growth," President Obama said last week. "This is a false choice."

During the same speech, he asked his audience to "let me just be clear" that his administration, having racked up the biggest budget deficits ever, is embracing fiscal responsibility, as reflected in his vow that "health-insurance reform" will not increase the deficit "by one dime."

For connoisseurs of Obama-speak, the address featured a trifecta, combining three of his favorite rhetorical tropes. There was the vague reference to "those who" question his agenda; the "false choice" they use to deceive the public; the determination to "be clear" and forthright, in contrast with those dishonest naysayers.

These devices are useful as signals that the president is about to mislead us.

Obama says his opponents wrongly insist that we choose between "paying down our deficits" and "investing in job creation and economic growth." But that is not the way his real critics -- as opposed to the imaginary, nameless ones who appear in his speeches -- would frame the issue.

The real critics question the premise that the spending Obama supports, which he says ultimately will boost tax revenues and curtail outlays for public-assistance programs, should be considered an investment at all -- and, if so, whether it is a better use of this money than the market would have found.

Copying his predecessor by throwing more money at education, for example, is a dubious strategy for spurring economic growth, since there is no clear relationship between spending and student achievement.

Likewise, Obama's promise that health-insurance subsidies won't expand the deficit may be "clear," but it's not realistic, since it's based on accounting tricks and wishful thinking. Congressional Democrats avoided counting a $240 billion Medicare "fix" by putting it in a separate bill and assumed reimbursement cuts that probably will never materialize.

Here are some other things Obama has asked us to let him be clear about: "Earmarks have given legislators the opportunity to direct federal money to worthy projects"; the US government "has no interest in running GM"; Medicare cuts will be made "in a way that protects our senior citizens" from changes in benefits or costs; and a "public option" for health care, which would invite businesses to offload their medical costs onto taxpayers and could drive private insurers from the market, "would not impact those of you who already have insurance."

From now on, when you hear Obama speak, try replacing "let me be clear" with "let me lie to you," and see if it makes more sense.

Speaking of making sense, some of the "false choices" Obama has identified in the last year are more puzzling than misleading. "I reject the false choice between securing this nation and wasting billions of taxpayer dollars," he declared in March. So according to Obama, we can secure the nation and waste billions of taxpayer dollars. Actually, that sounds about right.

Obama's depiction of his critics is a bit further removed from reality. In the health-care debate, he says, "there are those who simply don't believe Washington can bring about this change"; "there are those who will say that we do not go far enough"; "there are those who would have us try what has already failed, who would defend the status quo"; "there are those who will oppose reform no matter what"; and "there are those who want to seek political advantage."

What about those who don't like the status quo but have a different vision of reform, not because they want to go farther than Obama does but because they want to go in a different direction, toward more choice, more competition and less government involvement? In Obama's world, they don't exist.

Instead we have his bold yet achievable plan, pitted against socialist utopianism and blind partisan intransigence. Let me be clear: This is a false choice.

Kristol: Did the Medicare Buy-In Just Die on Face the Nation?
Sunday, December 13, 2009 @1:25pm blog post

On Face The Nation, Sens. Joe Lieberman and Ben Nelson made it pretty clear they weren't inclined to support the Reid "compromise" featuring a Medicare buy-in. Nelson said he thought such a buy-in is a bad idea, and Lieberman noted that on "the so-called Medicare buy-in -- the opposition to it has been growing as the week has gone on. Though I don't know exactly what's in it, from what I hear I certainly would have a hard time voting for it because it has some of the same infirmities that the public option did."

Reid might be able to arrange to get a jerry-rigged Congressional Budget Office score Monday or Tuesday that seems acceptable (the preferred way of doing this so far has been to have the legislation feature ten years of (alleged) spending cuts and (real) taxes and pay-ins, and then only five or six years of benefits). But it sounds as if Lieberman and Nelson aren't willing to play along with the notion that the way to save Medicare is to expand the number of subsidized, adversely-self-selected people in it.

But who's going finally to just say no? There must be a dozen moderate and/or red-state Democrats who would love for Reid's bill to die, but it's hard to be the one who definitively goes first. Lieberman and/or Nelson could do it. Or it might be that the easiest way for everything to collapse in the next couple of days would be for a gang of six (or whatever) to emerge--say, Lieberman, Nelson and Blanche Lincoln, and John McCain, Olympia Snowe, and Judd Gregg--who would agree to work together in the new year on bipartisan legislative efforts to pass sensible incremental reforms with substantial bipartisan support. Word leaking out of one meeting of such a group would put the Reid legislation out of its misery.

If moderate Democrats could say in good faith that the failure of Reid's bill now doesn't mean there won't be health care reform this congressional session--and there's no reason they shouldn't be able to say that, as there would be huge pressure on both parties next year to deliver something--then Democrats would have an easier time breaking ranks. Indeed, they could say such an outcome would be more in their party's, and their president's, interest, than jamming though a startlingly unpopular and incoherently bloated piece of legislation on a party-line vote. And they would be right.

Obama’s Wheel of Fortune: The president’s luck has changed — and he doesn’t seem to have noticed.
National Review
By Victor Davis Hanson
December 11, 2009, 4:00 a.m.

No one in the Obama throng has ever believed much in the Roman concept of a “wheel of fortune” — rota fortunae — so often alluded to by the likes of Cicero and Boethius.

But that metaphor for changeable fortune reminds us that at times we all enjoy inexplicable good luck — and therefore must brace for the moment when the wheel turns, and inevitable adversity follows.

Of course, the downturn is always worse for those who were flippant on the upturn — or so medieval moralists reminded haughty royalty. All cultures are aware of the fickleness of fortune — whether exemplified through the morality tale of Job, the polarities of hubris/nemesis, or the notion of karma.

Any student of the 2008 campaign could have seen that Obama’s messianic persona would not last — given the human propensity to tire of flashy neon signs that advertise empty trifles. Candidate Obama said nothing of real substance — even as he advised the wowed crowds that there were first-aid provisions for those who would soon faint in ecstasy at his very words.

That his platform was vague and disingenuous, contradicted much of what he had said in the past, and remained inconsistent mattered little. Any suspicions of the inexperienced community organizer from Chicago were trumped by popular fury at the Wall Street meltdown, weariness with eight years of the Bush administration, and the promise that the ascension of Obama would, on the cheap, wash away the guilt of the American suburbanite.

Remember his energy policy, such as it was?

When candidate Obama was pressed, he reluctantly mentioned nuclear energy, coal, oil, and natural gas. But these were castoff concessions. They were offered as sops until the popular anger over gas-price hikes subsided — and they were to become no more than mere bookends to soaring rhetoric about “millions of new green jobs.”

Infatuated voters apparently bought this fantasy. Our deserts and mountain passes would be scarred with ugly panels, turbines, and access roads, as millions of newly hired government construction workers rushed out to ensure that we could obtain 5 percent of our current power needs from such green salvations.

A charlatan like Van Jones (cf. the remarks of Valerie Jarrett, “Oooh. Van Jones, all right! So, Van Jones. We were so delighted to be able to recruit him into the White House. We were watching him . . . ”) surely knew more about America’s energy needs than did the CEO of Exxon.

But now, on the wheel’s downturn, President Obama must brace for spiraling energy costs when the world economy rebounds. Soon the sobering electorate will turn and ask why Obama did not push for nuclear power and encourage more exploitation of newly discovered natural-gas fields.

Ditto the war. For much of 2007–2009, “hope and change” masked the absurdity of Obama’s “I’m for the good war/Bush did the bad war” dichotomy. So now the wheel turns again, and hokey rhetoric cannot mask reality.

The bad war is relatively quiet. The good war has heated up — more Americans were killed in Afghanistan in Obama’s first ten months than in any of the Bush years. And the good-war president now addresses the nation with the look of “This is really not supposed to happen to Nobel Peace Prize winners!” and “Remember, Bush did it!” and “Where are the American people who used to support the Afghan war?” Had candidate Obama empathized with bad/worse choices in every war, rather than simplistically demonizing his predecessor, the public might be more sympathetic to his present plight.

Candidate Obama did not worry much about a creepy cast of characters that kept surfacing around him — Bill Ayers, Rashid Khalidi, Father Pfleger, Tony Rezko, the Rev. Jeremiah Wright. In the aggregate, they appeared as a coterie of unhinged, anti-American, and quite unpleasant people. Someone should have reminded Obama that he was running to be president, not a Chicago ward boss.

The lesson went unlearned. And so the cast was updated with the likes of Van Jones, Anita Dunn, and Kevin Jennings. Instead of “God d*** America,” we got George Bush was in on 9/11, the mass-murdering Chairman Mao was an inspirational political thinker, and homosexuality is merely an alternative lifestyle choice for our teens. The revolving planets change, but the pull of their sun remains the same.

On fiscal policy, candidate Obama could not quite explain who “they” were, who were to be skinned for the sins of Wall Street. Those who made over $150,000? Or was it $250,000, or perhaps $200,000?

In Obama’s never-never land, these amorphous “they” had all sorts of money from stealing bonuses, getting exorbitant tax cuts, or unnecessarily taking out tonsils or cutting off limbs. What was so hard about having “them” cash out a few of their hidden bank accounts to pay for green jobs and comprehensive health care?

So President Obama went on demonizing the productive classes, promising more taxes, gratuitously slurring the Chamber of Commerce and the town-hallers. And now suddenly there is surprise on the downturn that we are on the verge of what John Kerry once said of a 5.3 percent unemployment rate under George W. Bush — “a jobless recovery.”

“Bush did it” was the repeated campaign message. Those soaring cadences of castigation silenced worries that a first-term senator and former Chicago community organizer did not know much about the world around us.

Apparently, Obama was convinced that apologies, bows, concessions to Iran, Putin, Latin American Marxists, and the Arab world would wow them all the way his tropes had mesmerized upscale suburbanites in Palo Alto and Greenwich. After all, Obama had as many suspicions about America’s past as did our enemies and rivals whom he courted.

But then Obama learned that — unlike professors, stockbrokers, lawyers, and teachers — the likes of Ahmadinejad and Putin did not care about his Kenyan father. They had not read his Dreams from My Father. Their names are even more exotic than his. Instead such thugs interpret his showy magnanimity as innate weakness, and men like these will manipulate it rather than show deference.

Soon Putin will flex his muscles in Russia’s backyard. In a year or two Iran will announce that it has the bomb. And we will witness more anguished debates over the motives of the next Major Hasan, more Khalid Sheik Mohammeds contextualizing their mass murders live from New York, and more terrorist plotting on the assumption that the new administration is more interested in shutting down Guantanamo Bay than putting the fear of God into radical Islamists bent on our destruction.

So the wheel turned, and now most of the country disapproves of President Obama — in the greatest crash of approval ratings of any first-year-presidency in recent history.

Will the wheel turn again? Not for a while, given Obama’s reaction to his downturn.

Foreign policy? It is still “Bush did it,” not reflection on his own rookie errors.

The economy? Jobs saved by borrowing are better metrics than the old unemployment statistics. Blame Bush again, tinker with the stats, and print more money.

Small businesses? Employers are still “they,” who must and will pay higher income and payroll taxes, and higher premiums for medical insurance. They won’t be thanked for their greater contributions; rather, they owe a sort of penance for doing well and creating the nation’s wealth.

Energy? President Obama is on his way to Copenhagen — oblivious to Climategate. He ignores the paradoxes of a planet the last decade slighting cooling, when it is supposed to be radically heating. And he does not worry at all about the effects of new green taxes on the country — when the productive classes may soon be paying 65 percent of their incomes in state and federal taxes and increased insurance premiums.

Spending? Obama, if given his way, will run up debts to match the aggregate red ink of all prior presidents combined. So far, “Never let a serious crisis go to waste” has not been repudiated. Instead, Obama continues to blame Bush and the Republicans for causing the recession, rather than wondering whether his massive borrowing and disbursement are making things far worse.

In other words, a very human President Obama still does not grasp that events are catching up to him and that even his empyrean rhetoric cannot allow him to escape. For now, the wheel has turned, and it is still heading downward. If he does not change, his luck won’t either.

Good riddance to bipartisanship
National Review
By JONAH GOLDBERG
Last Updated: 9:37 AM, November 28, 2009
Posted: 2:19 AM, November 28, 2009

I hereby forfeit my claim to a right-wing- conspiracy-decoder ring by offering two cheers for the Democrats. I congratulate them on their victory last Saturday night in the Senate, and while I can't quite wish them success on the course they are following, I'm beginning to make peace with the possibility that they'll win.

For years, conservatives and liberals have flirted with the idea of disposing of the fool's errand of bipartisanship. Seeking compromise with partisans across the aisle is a recipe for getting nothing important done.

For liberals, New York Times columnist Paul Krugman has been a leader of this school. In 2007, Krugman wrote in Slate magazine that progressives should abandon any pretense at working with Republicans. The "middle ground," he wrote, "doesn't exist -- and if Democrats try to find it, they'll squander a huge opportunity. Right now, the stars are aligned for a major change in America's direction. If the Democrats play nice, that opportunity may soon be gone."

"If one thing is clear from the stimulus debate," he wrote earlier this year, "it's that the two parties have utterly different economic doctrines." Krugman went on to describe the different views in his typically tendentious manner.

He's right on the basic point. While there are plenty of hackish, opportunistic deal makers in both parties, the core visions -- one progressive, the other conservative -- that animate the rank and file are increasingly, and fundamentally, irreconcilable.

Hence, the quest for the middle ground usually rewards the worst politicians -- those devoid of any core convictions and only concerned with feathering their own nests -- and yields the worst policies. Blending the two visions is like trying to marry two different recipes. You don't get the best of both so much as a huge mess -- say, peanut butter and caviar -- or a fraudulent meal, like a "vegetarian" cheesesteak. Better to stay pure, have your way and convince the American people that your way is the best way.

In short, if you can't join 'em, beat 'em.

Now, the appeal of such an argument depends a great deal on your proximity to power. When your side is out of power, half a loaf is more appetizing than nothing. When in power, the thought of hogging the whole loaf for yourself instead of sharing is seductive.

I may be talking about team dynamics, but I don't mean that there's no difference between the teams. Far from it. The Democrats sincerely believe that nationalized health care, in one form or another, is the best thing for America and that if they can get it passed, voters will fall in love with it. Politically, there is a real danger they're right. Americans are loath to relinquish entitlements once they've secured them. That's the Republicans' gamble.

Then again, Democrats run the serious risk that before the imagined joys of health-care reform can be realized, voters will revolt over its tax hikes, huge Medicare cuts, increased bureaucracy and/or its budget-exploding costs. That's the Democrats' gamble.

Some moderate Democrats are making a side bet that they can vote for it out of solidarity and then run back to the center come the 2010 elections.

Well, I say let it ride. And just to make it more interesting, Republicans should promise to repeal "ObamaCare" if they get a congressional majority in 2010. As National Review's Ramesh Ponnuru argues, that way moderate Democrats won't be able to run away from their votes come 2010. They'll be on notice that this will be the issue of the election. And moderate Republicans will be on notice to resist the temptation to tinker with ObamaCare rather than defenestrate it once it's passed.

Sure, I'd rather see the health-care proposal die stillborn (and that's still quite possible). But if it passes, the upside is that Americans will finally be given a stark philosophical choice on a fundamental issue. That's much rarer than you might think. (Recall that the Iraq war and the bailouts were bipartisan affairs.)

ObamaCare is a vast, deeply polarizing demonstration project for progressive ideas. It's terrible policy, but it may well result in a beneficial backlash. "Example is the school of mankind," proclaimed Edmund Burke, "and they will learn at no other."

Democrats insist they're pushing for health-care reform against a political headwind because "history" compels them to. Republicans are standing athwart "history" yelling, "Stop!"

Politically, one side will be proved right, and the side proved wrong will pay a staggering price. Everyone's all in.

We Ain’t Seen Nothing Yet: If you think things have been rough so far, hang on.
National Review
By Victor Davis Hanson
November 26, 2009, 0:00 a.m.

When it comes to the problems facing this country, an old slogan comes to mind: “You Ain’t Seen Nothing Yet.”

High unemployment, the recession, and a terrorist resurgence in Afghanistan are bad enough. But there are a number of problems on the horizon that could dwarf President Obama’s first-year trials.

Why the pessimism? In short, we are doing nothing to prepare for the crises to come.

A global recession has led to low oil prices. Yet in this window of opportunity, America has not decreased its foreign-oil dependence. We are not encouraging domestic exploration. And we are still ambivalent on nuclear power.

But as the world economy recovers, oil will probably surge back over $100 a barrel, increasing our oil-import tab by 25 percent or more. The Obama administration, though, mostly is obsessed with subsidizing relatively small amounts of wind and solar power. It likely won’t be long before angry motorists at the pump are demanding to know why we have not pushed for more development at home of still-plentiful natural-gas and oil fields.

Meanwhile, other economic bad news may be just around the corner. Today, interest rates on short-term Treasury bills still are less than 1 percent. But they, too, will climb as business picks up and worries over American inflation spread.

If we have to pay foreign lenders 5 percent to 7 percent interest on our debt, as in the past, the increased costs will gobble up additional billions from our annual budget. Yet sadly again, we are missing this rare opportunity of low interest to pay off cheaply the trillions that we already owe. Instead, we are borrowing even more!

The War on Terror is also heating up again. Fairly or not, the Fort Hood massacre sent the message that the United States is more worried about appearing politically correct in matters of diversity than about hunting down radical Islamists on its home soil. Those who seek to copy what happened at Fort Hood will be encouraged. And those charged with stopping them will be discouraged and confused.

Such uncertainty was reinforced by the attorney general’s decision to try the architects of 9/11 in federal courts in New York City. At best, the confessed mass-murderer Khalid Sheikh Mohammed will lecture the United States. At worst, one sympathetic juror could find the monster only 99 percent guilty, and therefore the court might fail to convict him of planning the murders of 3,000 innocent people.

After announcing a new strategy of counterinsurgency in March, and appointing Gen. Stanley McChrystal the new supreme commander in Afghanistan, it looks like Obama only now will commit more troops to Afghanistan. That will be a wise decision — but one coming three months after the generals’ request.

We were given an unexpected reprieve through the defeat of al-Qaeda in Iraq. We can now build on that victory by routing the Taliban in the way the Iraq surge stabilized democracy there.

Finally, there is an array of taxes on the horizon — increased federal income-tax rates; promised hikes in health-care surcharge taxes; and even rumors of value-added federal sales taxes. These increases are said to be aimed at the proverbial wealthy. But that could change — given that the top 5 percent of households already provide 60 percent of the nation’s income-tax revenue. And many are already paying 50 percent to 60 percent of their incomes in combined local, state, federal, and payroll taxes.

Just consider. The price of gas will soon likely increase. The cost of servicing our profligate borrowing will, too. One more terrorist attack like at Fort Hood, or nightly sermons from a grandstanding Khalid Sheikh Mohammed, or a new Taliban offensive, and the momentum could shift to radical Islam in its decades-long war against the United States. Next year’s tax hikes will be real and large — and no longer just this year’s idle talk.

As these storm clouds gather, Congress bickers on Saturday nights about borrowing even more money for health-care reform, yet another federal entitlement.

If you think things have been rough so far, hang on, ’cause you ain’t seen nothing yet.

Op-Ed Columnist
Obama in His Labyrinth
NYTIMES
By ROGER COHEN
November 24, 2009

HALIFAX, Nova Scotia — Before coming up to Canada’s Atlantic provinces, where the nicest people in this nice country are said to live, I found myself seated next to Henry Kissinger at a New York dinner and asked him how he thought President Barack Obama was doing.

“He reminds me of a chess grandmaster who has played his opening in six simultaneous games,” Kissinger said. “But he hasn’t completed a single game and I’d like to see him finish one.”

I thought that wasn’t a bad image for Obama’s international gambits, and then here, at the first Halifax International Security Forum, I heard a similar observation from one participant: “We’ve had the set-up, but is there a middle game?” Or, put another way, can this probing, intelligent president close anything?

As an Obama admirer, I’m worried. He feels over-managed, over-scripted to me, to the point where he’s not showing the guts that prevailed at various difficult moments in the campaign. The ideas are good, but the warmth, cajoling and craft that make ideas more than that are lacking.

I find myself yearning for a presidential gaffe if only to reveal an instinctual human moment. Memo to Obama handlers: Give us a little more of the unvarnished. De-teleprompt the president for a few seconds!

The list of Obama’s international initiatives is of head-turning scope. There’s his “world without nuclear weapons,” announced in Prague last April, reiterated at the United Nations in September. It’s an idea with resonance, and may provide some moral suasion over countries contemplating pursuit of a bomb, but I can’t help recalling that the worlds of 1914 and 1939 were worlds without nukes. No thanks to that.

Unless proliferation, the most worrying global trend of the past 15 years is reversed, this dream is just a feel-good notion.

Then there’s the “reset button” with Russia, which always makes me think of those announcements on flights — “We’re trying to reset the video system” — and my heart sinks. One way to measure the importance of this attempt to warm a cool relationship is that Russia and the United States still control upward of 95 percent of the world’s nuclear arsenal.

There are glimmerings with Dmitri Medvedev, the Russian president, but as Robert Gates, the U.S. defense secretary, observed here, Russia now offers “two perspectives on the rest of the world depending on which of its leaders you’re talking to.” The other perspective is called Vladimir Putin.

Obama needs Russian help on Iran, but I’m not holding my breath for forthright cooperation from Moscow on any eventual sanctions. As for the follow-up agreement to the Strategic Arms Reduction Treaty, or Start, intended to cut Russian and American arsenals by about half and supposed to be signed before the old pact expires on Dec. 5, it still needs work. I don’t believe Obama has yet shifted the basic confrontational optic of a resurgent Russia emerging from the humiliation of imperial collapse.

On Afghanistan, where an announcement is at last imminent on the troops the United States will commit to “the necessary war,” Obama has mixed messages with unhappy results. The clarity of March yielded to the cloudiness of fall and the long think has, in the words here of John McCain, “sounded an uncertain trumpet.” Peter MacKay, the Canadian defense minister, said the hesitation was “not helpful” because “everyone has hit the pause button until the U.S. decision.”

I worry now that Obama’s quest for perfect calibration will yield a less than resounding fudge where the tenacious message of a troop increase is undermined by talk of exit timing. That’s not how you break the will of an enemy.

In Europe, a more modest reset attempt has been compromised with political leaders (if not the public) by a perception of cool distance, underscored when Obama did not show at 20th-anniversary celebrations of the Berlin Wall’s fall. Feelings are particularly strong in Paris, where mutterings about Obama’s “Carterization” are heard. President Nicolas Sarkozy, who ushered France back to NATO’s integrated military command structure, and shattered political taboos dictating coolness toward America, has seen his hopes for a special relationship evaporate.

In Israel-Palestine, Obama underestimated the damage of the past decade and has been outmaneuvered by Prime Minister Benjamin Netanyahu.

The president’s groundbreaking outreach to Iran, which I applaud, has unsettled a regime that does not know how to respond. But here, as elsewhere, Obama has been unnecessarily weak on human rights issues in the face of an unconscionable crackdown. There’s a trace of churlish “ABB” — “Anything but Bush” — in Obama’s failure to speak out more for human rights and freedom. Once again, calibration has trumped gut to a damaging degree.

Ieva Kupce, a Latvian Defense Ministry official here, told me, “Watching Obama, I worry that democracy is going out of fashion. We in Latvia would not have made it without the United States.”

The great battle of the 21st century is going to be between free-market democracies and free-market authoritarian systems. America’s position in that struggle has to be clear if Obama’s simultaneous grandmaster openings are to produce victories.

Marching off a cliff

By RICH LOWRY
Last Updated: 3:23 AM, November 23, 2009
Posted: 2:07 AM, November 23, 2009

Saturday night's health-care vote in the Senate was a theatrical fizzle. Sure, Majority Leader Harry Reid made senators sit at their desks for their vote to create a sense of "history" -- but everyone knew that he'd get the 60 votes he needed to start debate on ObamaCare.

If a $100 million Medicaid payoff to her state wasn't enough to keep Louisiana Sen. Mary Landrieu bought for at least a few days, there truly is no honor among thieves. Landrieu bragged about her swag, calculating that the "Lousiana Purchase" was really worth $300 million.

The two other centrist Democrats whose votes were in doubt -- Blanche Lincoln of Arkansas and Ben Nelson of Nebraska -- took refuge in the explanation that they had only a Socratic interest in opening a debate on the bill, and who could be against that?

But there was real drama Saturday -- the same drama playing out every day the Democrats persist in the political and fiscal heedlessness that characterizes their push for ObamaCare. It's as if they don't realize that they're led by a marginally popular president (dipping below 50 percent public approval in the Gallup poll last week for the first time), are deeply unpopular themselves and are pushing for legislation that is opposed by more people than support it in almost every single opinion poll.

But they do realize it -- they just don't care. They've talked themselves into the ludicrously self-delusional notion that what ails them and the president is that they haven't yet passed the hundreds of billions of dollars of tax hikes and Medicare cuts that finance (albeit incompletely) ObamaCare.

This will long be a case study in the annals of abnormal political psychology. Tax hikes undid George H.W. Bush and Bill Clinton (Bush lost his presidency, Clinton his congressional majority), and Medicare cuts undid Newt Gingrich (taking the air out of his "Republican revolution"). Obama's Democrats are prescribing themselves a strong dose of both, in an exercise in self-destructive quackery.

They believe that Obama can't afford failure, that's it's the defeat of ClintonCare that killed the Democrats in 1994. But such are the grave political and substantive flaws of ObamaCare that Democrats can't afford success or failure.

If they pass it, they have tax hikes and Medicare cuts around their necks, as well as the increased insurance premiums the bill is sure to cause. If they fail, they've demonstrated their own ineffectual ideological fervor, while still putting themselves on record in favor of tax increases and Medicare cuts.

The Democrats got themselves into this hellish dilemma by not taking the obvious step of scaling back the bill once it became clear it engendered fierce public resistance. Take half a loaf, disarm your critics, call it victory, hail yourselves at the signing ceremony -- and come back for more later. It's not complicated.

Instead, they've stayed on a maximalist course. They've pushed to the point where the effort could collapse -- and, even if they succeed, they'll have done themselves and the nation's fiscal future grave harm.

This is the other element of the drama that inheres in the health-care debate: If it passes, people years and even decades from now will look back and ask, "What were they thinking?" It's a rare opportunity to see a train wreck at its inception, as the conductors make the decisions with malice afterthought that will ramify disastrously.

Everyone agrees that the nation is on an unsustainable fiscal path. So Democrats will add a $2.5 trillion entitlement to hurry us further along the path. Tax hikes that could go to reducing the deficit they'll plow into the new entitlement. Medicare cuts that could shore up Medicare's own shaky finances, they'll plow into the entitlement too (if the cuts happen at all). The new entitlement will grow at a projected 8 percent a year, and it's only through gimmickry it's made to look deficit neutral in the first decade. The cost curve of health care will be bent up, and insurance premiums, too, will rise. For all of this, ObamaCare will still leave 24 million people without health insurance.

If nothing else, watching the Democrats sacrifice so much on behalf of this monstrosity is fascinating, appalling -- and dramatic. Common sense suggests that they shouldn't do it. The basic laws of political physics say they can't do it. And yet on they march.

What Obama Accomplished in Asia: Nothing much.
Weekly Standard
by Fred Barnes
11/19/2009 12:00:00 AM

Has a president ever been less successful on a trip overseas than President Obama has on his eight-day excursion to Asia? I've been covering presidents since Gerald Ford and I can't think of one.

Obama struck out on his entire agenda in China and he acquiesced as the Chinese subjected him to the humiliation of a choreographed town hall meeting with student members of the Young Communist League. And he suffered through a 30-minute news conference with Chinese President Hu Jintao in which no questions from the media were allowed. Presidents normally come away on visits to foreign countries with "deliverables"--that is, tangible signs of progress like a treaty signing. All Obama got was a list of things the United States and China would do in the future. There's a name for this: diplomatic boilerplate.

Obama's aides and flacks insisted he wasn't looking for immediate gains in the American relationship with China. Instead he was developing stronger relations for long term. This reminds me of what his defenders say about a football running back who doesn't gain many yards. He's a great blocker. Yeah, right!

And imagine the embarrassment of being lectured by the Chinese about being protectionist. No previous president has been subjected to that. China manipulates its currency and is protectionist itself. Yet Obama didn't have a good comeback to the charge because his administration has slapped tariffs on imports of Chinese tires and pipe. And Obama has declined to push for ratification of a free trade treaty, negotiated by the Bush administration, with South Korea.

What didn't Obama get in China? He wanted China to join in pressuring on Iran to stop its nuclear weapons program. He got nowhere on that. He hoped China would step up on curbing global warming. Again, he largely failed. He wished China would begin to strengthen its undervalued currency. On that, he got China's umpteenth promise to start that process--a hollow promise if there ever was one. Then there was human rights. No progress on that either.

That wasn't all. Even before Obama arrived in China, the U.S. was criticized at the Asia-Pacific Economic Cooperation forum by Russia, Mexico, and China for creeping protectionism. The best Obama, who now calls himself "America's first Pacific president," could offer was willingness to negotiate a possible U.S. membership in a minor trade pact known as the Trans-Pacific Partnership.

Also at the forum, Obama had to settle for less than he sought on global warming. As a result, next month's international meeting at Copenhagen will only be a stepping stone to a comprehensive treaty later to curb greenhouse gas emissions. Plus, China zinged Obama for the weakened dollar.

One surprise of the trip was the press coverage. For once in Obama's case, it wasn't adoring. Obama took his lumps from the New York Times, Washington Post, and Los Angeles Times for his lack of accomplishment. "When it came to China, President Obama's famous powers of persuasion failed to persuade," wrote Barbara Demick of the LA Times. "Not only is the U.S. president coming away without definable concessions, but the Chinese appeared to be digging in their heels."

For Obama, the honeymoon with the press may be over.

Changing the subject

By DICK MORRIS & EILEEN MCGANN
Last Updated: 4:20 AM, November 16, 2009
Posted: 12:51 AM, November 16, 2009

As he flew to Asia on Saturday, President Obama told the media in Alaska that he opposes a congressional investigation into the Fort Hood massacre, saying that we must "resist the temptation to turn this tragic event into political theater." Yet, even as he was posturing against political theatrics, he had just decided that the prosecution of 9/11 mastermind Khalid Sheikh Mohammed would proceed on the greatest of public stages -- New York City.

With the strict evidentiary rules in force in federal civilian courts, it is easy to see how the prosecution of Mohammed could morph into an indictment of the Bush administration's interrogation techniques and waterboarding. As in rape trials, the magnitude of the underlying crime (masterminding the 9/11 attacks) might well be lost as the defense puts the victim (in this case, the government) on trial.

It is not political theater itself to which Obama objects -- but theater that highlights issues that liberals would rather forget. He is quite content to let the Mohammed trial become the theater of the left. Perhaps even eager.

Obama and his handlers know that the key to building favorable ratings is to control the agenda. And the more the national discussion centers on national security and terrorism, the more Republicans gain. So the Fort Hood terror attack comes at an awful time for an administration trying to turn the nation's attention away from the terrorist threat.

As soon as the killing spree was over, Obama hastened to call it "an act of violence" -- obscuring the obvious fact that it was the most serious terror attack on US soil since 9/11. And, as evidence mounts that the FBI was on to Major Nidal Malik Hasan for years, the president is doing his best to stop Congress from finding out why these warnings went unheeded.

Even as Rep. Peter Hoekstra (R-Mich.), the ranking Republican on the House Intelligence Committee confirmed that the government knew of 10 to 20 e-mails between Hasan and a radical imam in Yemen -- who was urging the killing of American troops -- starting last December, Obama hastened to urge Congress to refrain from investigating why the danger signs were ignored.

The Obama administration has a clear agenda here:

1) Stop people from focusing in how his administration permitted the worst domestic terror attack in eight years.

2) Avoid a national airing of how liberal policies -- restraints on the intelligence community, political correctness in the armed forces -- might have inhibited the military from reining in Hasan.

3) Re-ignite a firestorm on the left and abroad against the aggressive anti-terror policies of the Bush administration.

Making all this particularly important for Obama are his other political needs.

As he likely decides to send more troops to Afghanistan and eyes abandoning the "public option" to secure Senate passage of his health-care plan, Obama has to rebuild his credibility on the left. A public circus that focuses on waterboarding and interrogations could be just what he wants and needs.

Op-Ed Columnist
Off the Chart
NYTIMES
By ROSS DOUTHAT
November 16, 2009

Ten months ago, at the beginning of the great stimulus debate, President-elect Barack Obama’s economic advisers produced an unfortunate chart.

The chart plotted out two lines. One projected the unemployment rate through 2014 with a stimulus package; the other projected unemployment across the same period without it.

The first line — the hopeful line, the one that was used to sell $800 billion worth of stimulus — showed the rate of joblessness peaking this fall at 8 percent, and dropping swiftly thereafter. The second line — the no-stimulus scenario — showed unemployment peaking at 9 percent, holding there across 2010, and then declining in 2011 and 2012.

Now reality has produced numbers of its own. In every month since May, the unemployment rate has been roughly a percentage point higher than the chart’s grimmer, stimulus-free scenario. This October, when Obama’s advisers predicted that unemployment would stand at 8 percent with the stimulus and just under 9 percent without it, the actual jobless rate leaped to 10.2 percent.

This dire figure isn’t Barack Obama’s fault. Even in an age of near-trillion-dollar spending sprees, the president of the United States has only limited influence over the unemployment numbers. But the White House spent the winter pretending otherwise. The stimulus bill was framed and sold primarily as a jobs bill, and the Obama administration placed a substantial bet on the promise that the unemployment rate would start dropping before 2010 arrived.

When the stimulus passed with almost no Republican support, Rahm Emanuel, the president’s chief of staff, declared that “the most important number ... is how many jobs it produces, not how many votes it gets.”

He was right. But with unemployment near a 25-year high, that “most important number” isn’t looking very good. The White House is stuck arguing counterfactuals — how much worse the economy would be without the stimulus — and trumpeting obviously inflated estimates of how many jobs have been “created or saved” by federal dollars.

If the midterm elections were held today, the Democrats would probably take an unemployment-driven beating. In Gallup’s generic Congressional ballot, Republicans are up 22 points among independents, and they’ve opened up a rare lead among the voting public as a whole.

“Most of the prior Republican registered-voter leads,” Gallup notes, “occurred in 1994 and 2002.” Both were ugly years for liberalism.

If there’s any comfort for Democratic legislators in this landscape, it’s the possibility that the angst-ridden health care debate may matter less to their re-election prospects than anyone expects. Amid the town-hall tumult in August, Obamacare looked like 2010’s defining issue. But when you talk to Republicans on Capitol Hill today, it sounds as if health care will play a relatively modest role in the campaign they plan to run.

If a bill passes, they’ll attack the Democrats for reorganizing the nation’s health care sector instead of putting Americans back to work. If the legislation fails, they’ll attack the Democrats for trying to reorganize the health care sector instead of putting Americans back to work.

Either way, though, they expect the jobs issue to matter much, much more than the specific details of health care reform.

The Democrats seem to be expecting this as well. Obama is planning an ostentatious “jobs summit” for December, and a “jobs bill” has suddenly materialized on Harry Reid’s to-do list. Nobody in the Democratic Party will call it a second stimulus, but the liberals who have complained that the first $800 billion wasn’t enough may get the second round of pump-priming they’ve been asking for.

They won’t get much else, though. It’s hard to imagine any legislation that might be attacked as “job killing” — like the Employee Free Choice Act, immigration reform or even cap-and-trade — finding traction in Congress next year.

This means that the broader Democratic agenda is essentially a hostage to the unemployment numbers. And Republicans are hoping that if they win enough seats in 2010, Obama will turn into Bill Clinton redux, pursuing compromises on deficits and entitlement reform in lieu of more liberal legislation.

Of course, they haven’t won yet. Even without a second stimulus, there’s still plenty of money from the first one set to wash into the economy before next year’s election (It almost seems as if Nancy Pelosi drew it up that way ...). The Republicans remain broadly unpopular: they're leading the polls more by default than because they inspire any deep affection. And they aren’t exactly overflowing with their own ideas for job creation at the moment.

If unemployment stays high enough, though, they may not need them. All they’ll have to do is tally up the job market’s performance since Barack Obama took office, and then draw a third line, in red, on a certain overly optimistic chart.

This article has been revised to reflect the following correction:

Correction: November 16, 2009
An earlier version of this column contained an incorrect statistic for the October unemployment rate. The correct figure is 10.2 percent, not 10.4 percent.

Op-Ed Contributors
Trading Women’s Rights for Political Power
NYTIMES
By KATE MICHELMAN and FRANCES KISSLING
November 12, 2009

Washington

A GRIM reality sits behind the joyful press statements from Washington Democrats. To secure passage of health care legislation in the House, the party chose a course that risks the well-being of millions of women for generations to come.

House Democrats voted to expand the current ban on public financing for abortion and to effectively prohibit women who participate in the proposed health system from obtaining private insurance that covers the full range of reproductive health options. Political calculation aside, the House Democrats reinforced the principle that a minority view on the morality of abortion can determine reproductive health policy for American women.

Many House members who support abortion rights decided reluctantly to accept this ban, which is embodied in the Stupak-Pitts amendment. They say the tradeoff was necessary to advance the right to guaranteed health care. They say they will fight another day for a woman’s right to choose.

Perhaps. But they can’t ignore the underlying shift that has taken place in recent years. The Democratic majority has abandoned its platform and subordinated women’s health to short-term political success. In doing so, these so-called friends of women’s rights have arguably done more to undermine reproductive rights than some of abortion’s staunchest foes. That Senate Democrats are poised to allow similar anti-abortion language in their bill simply underscores the degree of the damage that has been done.

Many women — ourselves included — warned the Democratic Party in 2004 that it was a mistake to build a Congressional majority by recruiting and electing candidates opposed to the party’s commitment to legal abortion and to public financing for the procedure. Instead, the lust for power yielded to misguided, self-serving poll analysis by operatives with no experience in the fight for these principles. They mistakenly believed that giving leadership roles to a small minority of anti-abortion Democrats would solve the party’s image problems with “values voters” and answer critics who claimed Democrats were hostile to religion.

Democrats were told to stop talking about abortion as a moral and legal right and to focus instead on comforting language about reducing the number of abortions. In this regard, President Obama was right on message when he declared in his health care speech to Congress in September that “under our plan, no federal dollars will be used to fund abortions” — as if this happened to be a good and moral thing. (The tone of his statement made the point even more sharply than his words.)

The party has distanced itself from the abortion-rights movement in other ways. It has taken to calling Democrats who oppose a woman’s right to choose “pro-life” (and not “anti-choice”). The group Democrats for Life of America, whose Congressional members ultimately led the battle to exclude private insurance companies that cover abortions from health insurance exchanges, was invited to hold a press conference in Democratic Party offices. The party has promoted “pro-life progressives” like Sojourners, Catholics United and Catholics in Alliance for the Common Good, organizations whose leaders have stated that abortions should be made “more difficult to get.”

This, then, is where we stand as party leaders celebrate passage of the House bill. When it comes to abortion, they seem to think all positions are of equal value so long as the party maintains a majority. But the party will eventually reap what it has sown. If Democrats do not commit themselves to defeating the amendment, then they will face an uncompromising effort by Democratic women to defeat them, regardless of the cost to the party’s precious majority.

In the meantime, the victims of their folly will be the millions of women who once could count on the Democratic Party to protect them from those who would sacrifice their rights for political gains.

Jihad in Texas
National Review
By the Editors
November 10, 2009, 4:00 a.m.

What was the craziest reaction to the attack at Ft. Hood by Major Hasan, the crazed jihadist? It could be Secretary of Homeland Security Janet Napolitano’s saying that what we most have to fear now is a possible wave of anti-Muslim sentiment. Or it could be journalist Michael Tomasky’s saying that we should not draw any inferences from “Allahu akbar,” the murderer’s battle cry, because it’s just something that votaries of the religion of peace say in moments of stress. We vote for a collective prize to all who attributed the bloodbath to post-traumatic stress disorder, not that Hasan ever experienced any trauma himself, but only heard tales of it when treating patients — presumably in the intervals when he was not trying to convert them to Wahhabism.

In time of war, a man who redefined his identity (he called himself Palestinian, though he was born in Virginia), prayed with a jihadist cleric, complained and preached to acquaintances, and may have contacted terrorists, shoots several dozen people, most of them servicemen and -women, and our commentariat wonders what is going on.

We see the operation of the same political correctness that cocooned Major Hasan in his Army career. Fellow soldiers noticed his strident and unbalanced behavior, but did not report him, lest they discriminate against him (or — their more likely fear — be rebuked for discrimination). He was invited to attend a conference of the Homeland Security Policy Institute at George Washington University in 2008. (Major Hasan, as it turned out, had a lot to say — not that he would have said it all, or that his plump-minded peers would have listened, even if he had.) We should not be surprised that journalists and pundits are no smarter than our defense and security bureaucracies.

We also suffer from a larger American unwillingness to acknowledge political violence. We rightly applaud ourselves for having avoided Europe’s upheavals. Yet the historic free flow of ideas in this country means that pernicious ones will lodge in the minds of very bad actors. Few of our famous assassins were mere loony loners without political motives. JFK’s assassin was a Marxist, RFK’s was another Palestinian, McKinley’s was an anarchist. Lincoln was murdered by a rogue Confederate intelligence operation. The solution is not to restrict freedom, but to take ideas seriously — to flag them and combat them; to monitor those who take them to extremes and to come down on them when they first cross the line to incitement or action; certainly to keep them out of positions of power or responsibility, even to the rank of major.

We have a difficult enough problem as it is: We cannot know where we are unless we honestly identify and discuss what happens around us.

Op-Ed Columnist
Call White House, Ask for Barack
NYTIMES
By THOMAS L. FRIEDMAN
November 8, 2009

The Israeli-Palestinian peace process has become a bad play. It is obvious that all the parties are just acting out the same old scenes, with the same old tired clichés — and that no one believes any of it anymore. There is no romance, no sex, no excitement, no urgency — not even a sense of importance anymore. The only thing driving the peace process today is inertia and diplomatic habit. Yes, the Israeli-Palestinian peace process has left the realm of diplomacy. It is now more of a calisthenic, like weight-lifting or sit-ups, something diplomats do to stay in shape, but not because they believe anything is going to happen. And yet, as much as we, the audience, know this to be true, we can never quite abandon hope for peace in the Holy Land. It is our habit. Indeed, as I ranted about this to a Jordanian friend the other day, he said it all reminded him of an old story.

“These two guys are watching a cowboy and Indian movie. And in the opening scene, an Indian is hiding behind a rock about to ambush the handsome cowboy,” he explained. “ ‘I bet that Indian is going to kill that cowboy,’ one guy says to the other. ‘Never happen,’ his friend answers. ‘The cowboy is not going to be killed in the opening scene.’ ‘I’ll bet you $10 he gets killed,’ the guy says. ‘I’ll take that bet,’ says his friend.

“Sure enough, a few minutes later, the cowboy is killed and the friend pays the $10. After the movie is over the guy says to his friend, ‘Look, I have to give you back your $10. I’d actually seen this movie before. I knew what was going to happen.’ His friend answers: ‘No, you can keep the $10. I’d seen the movie, too. I just thought it would end differently this time.’ ”

This peace process movie is not going to end differently just because we keep playing the same reel. It is time for a radically new approach. And I mean radical. I mean something no U.S. administration has ever dared to do: Take down our “Peace-Processing-Is-Us” sign and just go home.

Right now we want it more than the parties. They all have other priorities today. And by constantly injecting ourselves we’ve become their Novocain. We relieve all the political pain from the Arab and Israeli decision-makers by creating the impression in the minds of their publics that something serious is happening. “Look, the U.S. secretary of state is here. Look, she’s standing by my side. Look, I’m doing something important! Take our picture. Put it on the news. We’re on the verge of something really big and I am indispensable to it.” This enables the respective leaders to continue with their real priorities — which are all about holding power or pursuing ideological obsessions — while pretending to advance peace, without paying any political price.

Let’s just get out of the picture. Let all these leaders stand in front of their own people and tell them the truth: “My fellow citizens: Nothing is happening; nothing is going to happen. It’s just you and me and the problem we own.”

Indeed, it’s time for us to dust off James Baker’s line: “When you’re serious, give us a call: 202-456-1414. Ask for Barack. Otherwise, stay out of our lives. We have our own country to fix.”

The fact is, the only time America has been able to advance peace — post-Yom Kippur War, Camp David, post-Lebanon war, Madrid and Oslo — has been when the parties felt enough pain for different reasons that they invited our diplomacy, and we had statesmen — Henry Kissinger, Jimmy Carter, George Shultz, James Baker and Bill Clinton — savvy enough to seize those moments.

Today, the Arabs, Israel and the Palestinians are clearly not feeling enough pain to do anything hard for peace with each other — a mood best summed up by a phrase making the rounds at the State Department: The Palestinian leadership “wants a deal with Israel without any negotiations” and Israel’s leadership “wants negotiations with the Palestinians without any deal.”

It is obvious that this Israeli government believes it can have peace with the Palestinians and keep the West Bank, this Palestinian Authority still can’t decide whether to reconcile with the Jewish state or criminalize it and this Hamas leadership would rather let Palestinians live forever in the hellish squalor that is Gaza than give up its crazy fantasy of an Islamic Republic in Palestine.

If we are still begging Israel to stop building settlements, which is so manifestly idiotic, and the Palestinians to come to negotiations, which is so manifestly in their interest, and the Saudis to just give Israel a wink, which is so manifestly pathetic, we are in the wrong place. It’s time to call a halt to this dysfunctional “peace process,” which is only damaging the Obama team’s credibility.

If the status quo is this tolerable for the parties, then I say, let them enjoy it. I just don’t want to subsidize it or anesthetize it anymore. We need to fix America. If and when they get serious, they’ll find us. And when they do, we should put a detailed U.S. plan for a two-state solution, with borders, on the table. Let’s fight about something big.

Op-Ed Columnist
More Poetry, Please
By THOMAS L. FRIEDMAN
November 1, 2009

More and more lately, I find people asking me: What do you think President Obama really believes about this or that issue? I find that odd. How is it that a president who has taken on so many big issues, with very specific policies — and has even been awarded a Nobel Prize for all the hopes he has kindled — still has so many people asking what he really believes?

I don’t think that President Obama has a communications problem, per se. He has given many speeches and interviews broadly explaining his policies and justifying their necessity. Rather, he has a “narrative” problem.

He has not tied all his programs into a single narrative that shows the links between his health care, banking, economic, climate, energy, education and foreign policies. Such a narrative would enable each issue and each constituency to reinforce the other and evoke the kind of popular excitement that got him elected.

Without it, though, the president’s eloquence, his unique ability to inspire people to get out of their seats and work for him, has been muted or lost in a thicket of technocratic details. His daring but discrete policies are starting to feel like a work plan that we have to slog through, and endlessly compromise over, just to finish for finishing’s sake — not because they are all building blocks of a great national project.

What is that project? What is that narrative? Quite simply it is nation-building at home. It is nation-building in America.

I’ve always believed that Mr. Obama was elected because a majority of Americans fear that we’re becoming a declining great power. Everything from our schools to our energy and transportation systems are falling apart and in need of reinvention and reinvigoration. And what people want most from Washington today is nation-building at home.

Many people, including conservatives, voted for Barack Obama because in their hearts they felt he could pull us all together for that project better than any other candidate. Many are what I’d call “Warren Buffett centrists.” They are not billionaires, but they are people who believe in Mr. Buffett’s saying that whatever he achieved in life was due primarily to the fact that he was born in this country — America — at this time, with all of its advantages and opportunities.

I believe that. And I believe that without a strong America — which, at its best, can deliver more goods and goodness to its own citizens and to the world than any other nation — our kids and many others around the world will not have those opportunities.

I am convinced that this kind of nation-building at home is exactly what Mr. Obama is trying to deliver, and should be his unifying call: We need universal health care because it would strengthen our social fabric and enable our businesses to better compete globally. We need to upgrade our schools because no child in 21st-century America should be left behind and because we cannot compete for the best new jobs without doing so. We need a greener economy, not just to mitigate climate change, but because a world growing from 6.7 billion people to 9.2 billion by 2050 is going to demand more and more clean energy and water, and the country that develops the most clean technologies is going to have the most energy security, national security, economic security, innovative companies and global respect.

But to deliver this agenda requires a motivated public and a spirit of shared sacrifice. That’s where narrative becomes vital. People have to have a gut feel for why this nation-building project, with all its varied strands, is so important — why it’s worth the sacrifice. One of the reasons that independents and conservatives who voted for Mr. Obama have been so easily swayed against him by Fox News and people labeling him a “socialist” is because he has not given voice to the truly patriotic nation-building endeavor in which he is engaged.

“Obama’s election marked a shift — from a politics that celebrated privatized concerns to a politics that recognized the need for effective government and larger public purposes. Across the political spectrum, people understood that national renewal requires big ambition, and a better kind of politics,” said the Harvard political theorist Michael Sandel, author of the new best seller — “Justice: What’s the Right Thing to Do?” — that calls for elevating our public discourse.

But to deliver on that promise, Sandel added, Obama needs to carry the civic idealism of his campaign into his presidency. He needs a narrative that will get the same voters who elected him to push through his ambitious agenda — against all the forces of inertia and private greed.

“You can’t get nation-building without shared sacrifice,” said Sandel, “and you cannot inspire shared sacrifice without a narrative that appeals to the common good — a narrative that challenges us to be citizens engaged in a common endeavor, not just consumers seeking the best deal for ourselves. Obama needs to energize the prose of his presidency by recapturing the poetry of his campaign.”

Hope, change & peddling access

By MICHELLE MALKIN
Last Updated: 7:53 AM, October 31, 2009
Posted: 12:21 AM, October 31, 2009
Updated: Sat., Oct. 31, 2009, 7:53 AM home

Like Capt. Renault in "Casablanca," I am shocked, shocked to discover that access-peddling is going on in the Obama White House. Perks for deep-pocketed donors? Presidential meetings for sale? The stale Chicago odor of pay-for-play wafting from 1600 Pennsylvania Avenue? Knock me over with a feather.

Despite the president's claimed distaste for the campaign-finance practice known as "bundling" (rounding up contributions from friends, business associates and employees), the House of Obama has been a bundlers' paradise from Day One. A new Washington Times report just confirms the obvious: It's business as usual in the era of Hope and Change. O's wealthiest Democratic donors have received lavish receptions, golf outings, bowling dates and movie nights with Obama.

And internal Democratic National Committee documents acquired by the Times show that "high-dollar fund-raisers have been promised access to senior White House officials in exchange for pledges to donate $30,400 personally or to bundle $300,000 in contributions ahead of the 2010 midterm elections."

Yup, they're just haggling over the price.

Many Obama bundlers have secured slots on federal advisory panels and commissions. Still more have benefited from the time-honored patronage tradition of rewarding political benefactors with ambassadorships. Clinton did it. Bush did it. Despite all his fantastical rhetoric of bringing a "new politics" to Washington, Obama's done it, too.

His ambassador to London, Louis Susman, is a Chicago crony with no diplomatic experience who bundled between $200,000 and $500,000 for Team Obama and is known as "The Vacuum Cleaner" for his fund-raising prowess. His ambassador to France, entertainment mogul Charlie Rivkin, headed up Obama's California fund-raising operations, raking in $500,000 for the campaign and another $300,000 for the inaugural. His ambassador to Spain, Boston moneyman Alan Solomont, bundled the same amounts for the campaign and inaugural.

In June 2008, candidate Obama railed: "We need a president who will look out for the interests of hardworking families, not just their big campaign donors and corporate allies." After the speech, he headed to a campaign fund-raiser at the Manhattan HQ of Credit Suisse, a major investment company caught up in the subprime lending debacle. President Obama collected $3 million last week at another Manhattan fund-raiser after carping about Wall Street's "self-interestedness." Audacity is his middle name.

When Obama inveighs against Wall Street greed and politicians beholden to Big Business, remember this: The Wall Street gamblers that Obama and his wife carped about on the campaign trail shoveled money to his campaign hand over fist. The Center for Responsive Politics reports that hedge funds and private-equity firms donated $2,992,456 to Obama in the 2008 cycle. No fewer than 100 Obama bundlers are investment CEOs and brokers: Nearly two dozen work for Lehman Brothers, Goldman Sachs or Citigroup.

Obama happily accepted more than $200,000 in bundled contributions from billionaire hedge-fund manager James Torrey, more than $100,000 in bundled contributions from billionaire hedge-fund manager Paul Tudor Jones and more than $50,000 in bundled contributions from billionaire hedge-fund manager Kenneth C. Griffin, CEO of Citadel Investment Group.

Another notable: Chicago banker James Reynolds, who raised more than $200,000 for the Obama campaign while chief executive of Loop Capital Markets. The municipal-bond specialist was a longtime friend of Obama's -- feting him at his Hyde Park home and convincing friends and associates to open up their wallets more than a decade ago.

In 2003, USA Today reported, Reynolds was caught on FBI wiretaps arranging what prosecutors called a "sham" consulting contract with a gal pal of a Philadelphia mayoral adviser. After the conversations, Reynolds snagged $300,000 in no-bid city contracts for Loop Capital Markets. City officials went to jail over the scam. Reynolds skated. The Obama campaign's only statement? "Jim Reynolds has admitted that he made mistakes, but he has not been charged with any wrongdoing."

Fortunately for Obama bundlers who may find themselves in legal trouble in the future, Clinton-era donor-maintenance fixer Eric Holder (who oversaw the pardon for fugitive financier Marc Rich) is guarding the henhouse at the Justice Department.

As Obama himself noted in 2007: "It is no coincidence that the best bundlers are often granted the greatest access, and access is power in Washington."

Indeed, the Obama White House policy can be summed up thus: No Bundler Left Behind.

Three Envelopes: Afghanistan is Obama’s problem.
National Review
By Charles Krauthammer
October 30, 2009, 0:00 a.m.

Old Soviet joke:

Moscow, 1953. Stalin calls in Khrushchev.

“Niki, I’m dying. Don’t have much to leave you. Just three envelopes. Open them, one at a time, when you get into big trouble.”

A few years later, first crisis. Khrushchev opens envelope 1: “Blame everything on me. Uncle Joe.”

A few years later, a really big crisis. Opens envelope 2: “Blame everything on me. Again. Good luck, Uncle Joe.”

Third crisis. Opens envelope 3: “Prepare three envelopes.”

In the Barack Obama version, there are 50 or so such blame-Bush free passes before the gig is up. By my calculation, Obama has already burned through a good 49. Is there anything he hasn’t blamed George W. Bush for? The economy, global warming, the credit crisis, Middle East stalemate, the deficit, anti-Americanism abroad — everything but swine flu.

It’s as if Obama’s presidency hasn’t really started. He’s still taking inventory of the Bush years. Just this Monday, he referred to “long years of drift” in Afghanistan in order to, I suppose, explain away his own, well, year-long drift on Afghanistan.

This compulsion to attack his predecessor is as stale as it is unseemly. Obama was elected a year ago. He became commander in chief two months later. He then solemnly announced his own “comprehensive new strategy” for Afghanistan seven months ago. And it was not an off-the-cuff decision. “My administration has heard from our military commanders, as well as our diplomats,” the president assured us. “We’ve consulted with the Afghan and Pakistani governments, with our partners and our NATO allies, and with other donors and international organizations” and “with members of Congress.”

Obama is obviously unhappy with the path he himself chose in March. Fine. He has every right — indeed, duty — to reconsider. But what Obama is reacting to is the failure of his own strategy.

There is nothing new here. The history of both the Afghanistan and Iraq Wars is a considered readjustment of policies that have failed. In each war, quick initial low-casualty campaigns toppled enemy governments. In the subsequent occupation stage, two policy choices presented themselves: the light or heavy “footprint.”

In both Iraq and Afghanistan, we initially chose the light footprint. For obvious reasons: less risk and fewer losses for our troops, while reducing the intrusiveness of the occupation and thus the chances of creating an anti-foreigner backlash that would fan an insurgency.

This was the considered judgment of our commanders at the time, most especially Centcom commander (2003–2007) Gen. John Abizaid. And Abizaid was no stranger to the territory. He speaks Arabic and is a scholar of the region. The overriding idea was that the light footprint would minimize local opposition.

It was a perfectly reasonable assumption, but it proved wrong. The strategy failed. Not just because the enemy proved highly resilient, but because the allegiance of the population turned out to hinge far less on resentment of foreign intrusiveness (in fact, the locals came to hate the insurgents — al-Qaeda in Iraq, the Taliban in Afghanistan — far more than us) than on physical insecurity, which made them side with the insurgents out of sheer fear.

What they needed, argued Gen. David Petraeus against much Pentagon brass opposition, was population protection, i.e., a heavy footprint.

In Iraq, the heavy footprint — also known as the surge — dramatically reversed the fortunes of war. In Afghanistan, where it took longer for the Taliban to regroup, the failure of the light footprint did not become evident until more recently when an uneasy stalemate began to deteriorate into steady Taliban advances.

That’s where we are now in Afghanistan. The logic of a true counterinsurgency strategy there is that whatever resentment a troop surge might occasion pales in comparison with the continued demoralization of any potential anti-Taliban elements unless they receive serious and immediate protection from U.S.-NATO forces.

In other words, Obama is facing the same decision on Afghanistan that Bush faced in late 2006 in deciding to surge in Iraq.

In both places, the deterioration of the military situation was not the result of “drift,” but of considered policies that seemed reasonable, cautious, and culturally sensitive at the time, but ultimately turned out to be wrong.

Which is evidently what Obama now thinks of the policy choice he made on March 27.

He is to be commended for reconsidering. But it is time he acted like a president and decided. Afghanistan is his. He’s used up his envelopes.

Dismantling America: Will the country wake up before it’s too late?
National Review
By Thomas Sowell
October 27, 2009, 0:00 a.m.

Just one year ago, would you have believed that an unelected government official, not even a cabinet member confirmed by the Senate but simply one of the many “czars” appointed by the president, could arbitrarily cut the pay of executives in private businesses by 50 percent or 90 percent?

Did you think that another “czar” would be talking about restricting talk radio? That there would be plans afloat to subsidize newspapers — that is, to create a situation where some newspapers’ survival would depend on the government’s liking what they publish?

Did you imagine that anyone would even be talking about having a panel of so-called “experts” deciding who could and could not get life-saving medical treatments?

Scary as that is from a medical standpoint, it is also chilling from the standpoint of freedom. If you have a mother who needs a heart operation or a child with some dire medical condition, how free would you feel to speak out against an administration that has the power to make life-and-death decisions about your loved ones?

Does any of this sound like America?

How about a federal agency giving school children material to enlist them on the side of the president? Merely being assigned to sing his praises in class is apparently not enough.

How much of America would be left if the federal government continued on this path? President Obama has already floated the idea of a national police force, something we have done without for more than two centuries.

We already have local police forces all across the country and military forces for national defense, as well as the FBI for federal crimes and the National Guard for local emergencies. What would be the role of a national police force created by Barack Obama, with all its leaders appointed by him? It would seem more like the brownshirts of dictators than like anything American.

How far the president will go depends of course on how much resistance he meets. But the direction in which he is trying to go tells us more than all his rhetoric or media spin.

Barack Obama has not only said that he is out to “change the United States of America,” the people he has been associated with for years have expressed in words and deeds their hostility to the values, the principles, and the people of this country.

Jeremiah Wright said it with words: “G** damn America!” Bill Ayers said it with bombs that he planted. Community-activist goons have said it with their contempt for the rights of other people.

Among the people appointed as czars by President Obama have been people who have praised enemy dictators like Mao, who have seen the public schools as places to promote sexual practices contrary to the values of most Americans to a captive audience of children.

Those who say that the Obama administration should have investigated those people more thoroughly before appointing them are missing the point completely. Why should we assume that Barack Obama didn’t know what such people were like, when he had associated with precisely these kinds of people for decades before he reached the White House?

Nothing is more consistent with his lifelong patterns than putting such people in government — people who reject American values, resent Americans in general and successful Americans in particular, and resent America’s influence in the world.

Any miscalculation on his part would be in not thinking that others would discover what these stealth appointees were like. Had it not been for the Fox News Channel, these stealth appointees might have remained unexposed. Fox News is now high on the administration’s enemies list.

Nothing so epitomizes President Obama’s own contempt for American values and traditions as trying to ram two bills through Congress in his first year — each bill more than a thousand pages long — too fast for either of them to be read, much less discussed. That he succeeded only the first time says that some people are starting to wake up. Whether enough people will wake up in time to keep America from being dismantled, piece by piece, is another question — and the biggest question for this generation.

America’s Obama Obsession: Anatomy of a passing hysteria.
National Review
By Victor Davis Hanson
October 23, 2009, 4:00 a.m.

For 30 months the nation has been in the grip of a certain Obama obsession, immune to countervailing facts, unwilling to face reality, and loath to break the spell. But like all trances, the fit is passing, and we the patient are beginning to appreciate how the stupor came upon us, why it lifted, and what its consequences have been.

HOW OBAMA WON

Barack Obama was elected rather easily because, in perfect-storm fashion, five separate trends coalesced last autumn.

1) Obama was eloquent, young, charismatic — and African-American. He thus offered voters a sense of personal and collective redemption, as well as appealing to the longing for another JFK New Frontier figure. An image, not necessarily reality, trumped all.

2) After the normal weariness with eight years of an incumbent party and the particular unhappiness with Bush, the public was amenable to an antithesis. Bush was to be scapegoat, and Obama the beginning of the catharsis.

3) Obama ran as both a Clintonite centrist and a no-red-state/no-blue-state healer who had transcended bitter partisanship. That assurance allowed voters to believe that his occasional talk of big change was more cosmetic than radical.

4) John McCain ran a weak campaign that neither energized his base nor appealed to crossover independents. McCain turned off conservatives; many failed to give money, and some even stayed home on election day. Meanwhile, the media and centrists who used to idolize McCain’s non-conservative, maverick status found Obama the more endearing non-conservative maverick.

5) The September 2008 financial panic turned voters off Wall Street and the wealthy, and allowed them to connect unemployment and their depleted home equity and 401(k) retirement plans with incumbent Republicans. In contrast, they assumed that Obama, as the anti-Bush, would not do more bailouts, more stimuli, and more big borrowing.

Take away any one of those factors, and Obama might well have lost. Imagine what might have happened had Obama been a dreary old white guy like John Kerry; or had Bush’s approvals been over 50 percent; or had Obama run on the platform he is now governing on; or had McCain crafted a dynamic campaign; or had the panic occurred in January 2009 rather than September 2008. Then the trance would have passed, and Obama, the Chicago community organizer and three-year veteran of the U.S. Senate, would have probably lost his chance at remaking America.

OBAMA'S ASSUMPTIONS

I note all this at length because Obama seems to act as if this right-center country — one that polls oppositely to his positions on most of the major issues (deficits, spending, nationalized health care, homeland security, Guantanamo, cap-and-trade, etc.) — has given him a mandate for a degree of change not seen in nearly 80 years.

Apparently, Team Obama figured that with sizable majorities in both the House and the Senate, Obama would snap his fingers, Congress daily would pass bills redefining America, and Obama would stay in perpetual campaign mode to hope and change the country to accept his agenda. Governing would be like campaigning, as audiences fainted hearing the details of a 1,500-page health-care bill or of ever more sins from America’s past.

But, after just a few months in office, that proved not to be the case. Just as a number of planets had to line up precisely to allow an inexperienced hard-left ideologue to be elected president, so there would have had to be a similar configuration to allow him to govern successfully.

BITTER TRUTHS

1) Obama had to match his unity rhetoric with brotherly action. In fact, he has done the opposite.

At one time or another, Obama and his supporters have, rather scurrilously, insulted doctors, insurers, the police, tea-partiers and town-hallers, opponents of his health-care plan, non-compliant members of the media, and a host of other groups as either greedy, dishonest, treasonous, unpatriotic, moblike, racist, or in general worthy of disrespect.

Fewer and fewer Americans now believe that Obama — after just nine months of governance — is a uniter. In Obama’s world, doctors carve out children’s tonsils for profit, racist morons rant at legislators about losing their private health care, and trillions in borrowed money must be paid back by the greedy rich whose capital was unearned in the first place.

When his base supporters lambaste him for softness, they are lamenting his inability to become an effective partisan — not a lack of partisanship in general. In surreal fashion, liberals demand that the ideologue Obama become more ideological precisely at the time his ideologically driven agenda is souring millions of non-ideological Americans.

2) His opposition is no longer ossified, but decentralized and grass roots. One of the oddest proofs of that statement is the sudden leftist furor at tea parties, town halls, the media, dissent, and free speech. As long as Obama was opposed by calcified Republicans in Congress, there was no real danger to him. But once the opposition proved populist, panicked liberal elites started demonizing populism — and Obama now finds himself opposed to the popular grievance-mongering that was once the mother’s milk of our Chicago organizer’s existence.

3) Obama campaigned on the notion that even if voters might not like his policies, they most assuredly would like him. Even that spell is now lifting. The more the American public gets to know Barack Obama, the less they find him appealing.

On matters racial, their campaign-season unease with his connection to the Rev. Jeremiah Wright, his toss-offs like “typical white person,” and his stereotyping of rural Pennsylvanians has not been allayed; rather, it has been amplified by Eric Holder’s Justice Department, Obama’s own statement that the Cambridge police acted “stupidly” in arresting Professor Gates, and the use of the race card by prominent Democrats from the likes of Rep. Charles Rangel to Gov. David Paterson of New York.

Much of the newly stirred public suddenly assumes two things from the Obama administration: that the president himself will periodically say something racially insensitive or unwise; and that his supporters will call opponents of his policies racist. If we have wearied of all that in nine months, think what four years of it will do to the public mood.

In just nine months the phrase “Chicago style” has gone from something old-time that evokes Al Capone or Mayor Daley to something very real, contemporary, and scary — as David Axelrod, Rahm Emanuel, Valerie Jarrett, and others try to strong-arm the opposition, demonize the media, and manipulate government largesse to either penalize or reward recipients on the basis of their degree of support for Obama.

Could the most imaginative right-wing political operative have invented the idea of a National Endowment for the Arts official gleefully considering quid pro quo grants, administration officials trying to persuade other media outlets that a network critical of Obama is “not a news organization,” or an administration communications director bragging about how her team sandbagged the American media and took them to the cleaners? We can believe there might be one statement like Van Jones’s slander of “white people,” or Sonia Sotomayor’s “wise Latina” boast, or Anita Dunn’s lengthy praise of the mass-murdering Mao, but not an entire series of them. At some point, the American public snaps out of it, and sighs, “Wow, these people really are nuts!”

4) “Bush Did it” was the IV drip of the Obama campaign, always there to infuse a fresh life-saving excuse into every Obama fainting spell. But the problem now is that it has been more than nine months since Bush left office, and Obama’s “mop up” metaphors are getting stale. Worse still, the reasons the public soured on Bush are precisely the reasons it may well sour more on Obama, inasmuch as he took Bush’s problems like deficits, soaring federal spending, bailouts, and unemployment and made them far worse.

Yet Obama has given no credit for the good that Bush did, and therefore must remain mum about the other “Bush Did It”s, like quiet in Iraq; the homeland-security protocols, from renditions and tribunals to wiretaps and intercepts; AIDS relief for Africa; friendly governments in Britain, France, Germany, India, and Italy; and domestic safety since 9/11. If Bush is at least partly responsible for all these things as well, were they therefore bad?

NOW WHAT?

Obama very soon is going to have to make a tough choice, far tougher than his current “present” votes on the option of sending additional troops to Afghanistan.

As the midterm elections near, and his popularity bobs up and down around 50 percent, Obama can do one of two things.

He could imitate Bill Clinton’s 1995 Dick Morris remake. In Obama’s case, that would mean, abroad, cutting out the now laughable apologies for his country, ceasing to court thugs like Ahmadinejad, Chávez, and Putin, keeping some distance from the U.N., and paying closer attention to our allies like Britain and Israel. At home, he could declare victory on his sidetracked agenda and then start over by holding spending in line, curbing the deficit, stopping the lunatic Van Jones–style czar appointments, courting the opposition, and tabling cap-and-trade. I think there is very little chance of any of the above, whatever voters may have thought during the campaign.

Or, instead, Obama could hold the pedal to the floor on the theory that, as a proven ideologue, he must move the country far left before the voters catch on and stop him in his tracks in November 2010. That would mean more of the “gorge the beast” effort to spend and borrow so much that taxes have to soar, and thus redistribution of income will be institutionalized for a generation. He would push liberal proposals no matter how narrow the margin in the Senate. He would keep demonizing Fox News. In Nixonian fashion he might continue to hit the stump, ratcheting up his current “they’re lying” message and energizing his left-wing base by catering to the unions, gays, minorities — and liberal Wall Street special interests.

If he chooses the former, he might well be a more successful version of Bill Clinton given that his appetites are far more in check.

But if, as is likely, he chooses the latter, he will polarize the country in a way not seen since 1968, set back racial relations to the 1960s, do to the reputation of big government what LBJ did from 1964 to 1968, and, in the manner of what Jimmy Carter wrought, turn voters off liberal foreign policy for a generation.

— NRO contributor Victor Davis Hanson is a senior fellow at the Hoover Institution.

Inadequate indecision
Washington Times
Clifford D. May
Saturday, October 24, 2009

Don't fault President Obama for reconsidering his strategy in Afghanistan. Fault him for reconsidering his strategy only in Afghanistan. Nearing the end of his first year in office, his administration has not yet developed a coherent and comprehensive plan to defend Americans from the movements, groups and regimes that declare themselves our enemies, explicitly state their intentions - e.g., "Death to America!" - and, unless we take steps to prevent it, will soon have nuclear capabilities to help them accomplish their mission.

The Bush administration fought what it called a "Global War on Terrorism." The phrase was unsatisfactory because it suggested our fight was against a weapon rather than against an enemy using that weapon. But at least it acknowledged the obvious: An asymmetric war is being waged against the United States and other free nations.

The Obama administration has rejected the Global War on Terrorism. Its spokesmen say there is no global conflict - only "overseas contingency operations." The problem with this is not merely semantic. It's conceptual. It's disconnecting the dots.

In his new book, "Accomplice to Evil: Iran and the War Against the West," Michael Ledeen, the Freedom Scholar at the Foundation for Defense of Democracies (the policy institute I head), asks why, in the 1930s, so many otherwise smart people were so blind to the gravity of the threat posed by the Nazi movement that arose in Germany, the militarist movement that arose in Japan and the Fascist movement that arose in Italy.

Whatever the explanation, we might have learned from that experience. Yet today, so many otherwise smart people are equally blind to the gravity of the threat posed by the Khomeinist movement that arose in Iran in 1979 and the al Qaeda movement that arose in Pakistan and Afghanistan in 1988.

These movements are rivals - Khomeinism appeals primarily to Shia Muslims, while al Qaeda reaches out to the Sunni - but they can and do cooperate and conspire against those they view as common enemies. One or both have links to other groups - the Taliban, Hezbollah, Hamas - that are waging war against "infidels." The Wahhabis of Saudi Arabia stoke the fires of Islamic rage in mosques, madrassas and media, and they use their enormous oil revenues to fund Islamist terrorists, insurgents and militants around the world.

"The rise of messianic mass movements is not new, and there is very little we do not know about them," Mr. Ledeen notes in his book. Yet "there is little apparent recognition that we are under attack by a familiar sort of enemy, and great reluctance to act accordingly."

German Nazis, Italian Fascists and Japanese militarists all had grievances. They sought to redress those grievances and gain power through war and conquest. President Franklin D. Roosevelt's response was not to pursue "conflict resolution." His goal was to defeat them - utterly and unconditionally. After that, the United States could and would assist in a robust reconstruction effort.

Roosevelt understood, too, that he was not fighting one war in Europe, another war in the Pacific and a third in North Africa. He grasped that these were separate theaters in a single struggle to defend the West.

Seeing the current struggle similarly - recognizing that militant jihadists are fighting on multiple fronts from Iraq to Afghanistan to Gaza to Lebanon to Pakistan - would help clarify the administration's strategic thinking.

In Afghanistan, Mr. Obama appears to be considering three options. He can go all in, providing the resources required for a full-blown and prolonged counterinsurgency campaign. He can go all out - withdrawing and, almost certainly, accepting the Taliban's return to power. Or he can maintain the status quo, which at best would mean a prolonged stalemate.

It is not an easy decision. But to make it correctly requires asking how the outcome of this battle will affect the broader conflict, the "War Against the West," which is the real "war of necessity." But Mr. Obama and his advisers won't ask that question until and unless they acknowledge that such a war is under way.

Clifford D. May is president of the Foundation for the Defense of Democracies, a policy institute focusing on terrorism.

Perotistas on the March: The return of “raging moderates” and “angry centrists.”
National Review
By Jonah Goldberg
October 21, 2009, 0:00 a.m.

One of the most macabre images I’ve ever heard described came in the aftermath of the Asian tsunami in 2004. Before the tidal wave crashed on shore, beachgoers stood around and idly gaped as the water drastically receded. Bewildered, they didn’t realize they were looking at the prelude to a calamity.

The Democratic party looks more and more like those beachgoers every day, watching popular support recede, oblivious to the Perot tsunami coming our way.

In 1992, the incumbent president, George H. W. Bush, was a disappointment to his party’s base and a pariah to the Democrats. Government seemed to have lost its grip. The deficit became a massive issue, a symbol of out-of-control government. The hangover of Cold War sacrifices, the S&L bailout, runaway crime, huge trade deficits, the long-term trend of manufacturing decline, and, of course, the recession contributed to the sense that America desperately needed to get its house in order.

Ross Perot, a quirky Texas billionaire, tapped into that anxiety perfectly. Western, pro-business, no-nonsense, pro-choice and pro-gun, culturally conservative but with little interest in culture-war issues, he managed to thread the needle between both parties. He also benefited enormously from the fact that his independent bid for the presidency was seen by the press as an indictment of both the incumbent Republican and the “Reagan deficits” that Democrats and the media had been denouncing for years. At one point, Perot led in the polls, and if he hadn’t dropped out and then rejoined (or had he not been so Yosemite Sam-goofy), he might have done even better than his historic 19 percent of the popular vote.

It’s still debated whether Perot cost Bush the election. But even if Clinton would have won regardless, Perot’s candidacy had an underappreciated significance. He forced Clinton to double-down on his “New Democrat” appeals. Clinton had already fashioned himself as a “different kind of Democrat” who would “end welfare as we know it.” But the Perotista revolt of “raging moderates” and “angry centrists” reinforced Clinton’s rhetorical commitments and the voters’ expectations.

Historian Richard Hofstadter identified the phenomenon decades earlier when he wrote of third parties in U.S. politics: “Their function has not been to win or govern but to agitate, educate, generate new ideas and supply the dynamic element in our political life.”

He added: “Third parties are like bees: Once they have stung, they die.” The Perotistas stung in 1992.

Once elected — with only 43 percent of the vote — Clinton seemed to betray his promises to govern from the center. His heavy-handed “Hillarycare” effort was exactly the sort of thing the Perotistas didn’t want (never mind gays in the military and all that). The Democrats were shellacked in 1994, losing the Senate and the House to Newt Gingrich and his “Contract with America,” which was a carefully calibrated appeal to centrism.

The liberal interpretation of this sea change has always been freighted with denial. The late ABC News anchor Peter Jennings said the election was a giant hissy fit: “Ask parents of any two-year-old and they can tell you about those temper tantrums. . . . The voters had a temper tantrum.”

In part because Perot voters and sympathizers were disproportionately white and male, and because they expressed their dismay with Clinton by voting for the GOP, the Democrats and the media ginned up the “angry white male” theory of American politics. The same voters who were part of a “vital center” when attacking a Republican president were increasingly recast as dangerous minions of Rush Limbaugh and the forces of hate when they aligned with Republicans.

Fast-forward to today. The tea-party protesters are in large part the heirs of Perotism, and they are being subjected to the same insults. Liberal commentators are deaf to the tea partiers’ disdain for both political parties, preferring to cast the protesters as a deranged band of birthers and racists or hired guns of a Republican “AstroTurf” campaign.

Meanwhile, as National Review’s Ramesh Ponnuru has argued, the Democrats have convinced themselves that the moral of Clinton’s failed health-care push is not that he was wrong to try, but that he was wrong not to cram it through against popular opposition.

President Obama promised a “new era of fiscal responsibility,” but he’s governing as if exploding the size of government is what Americans want, polls be damned. The Democrats’ budget games and giveaways amount to poking the angry Perotista beast with a stick.

If the GOP can convincingly align with and exploit the growing Perotista discontent, it very well might ride to victory on a tsunami the Democrats can’t even see.

An iconic piece of what was claimed to be original art, destroyed by greed.

Artist admits he lied about 'Hope' photo
NYPOST
ASSOCIATED PRESS
Last Updated: 3:09 PM, October 17, 2009
Posted: 3:06 PM, October 17, 2009

Shepard Fairey’s claim that he had the right to use a news photo to create his famous Barack Obama “HOPE” poster became a widely watched court case about fair use that now appears to have nearly collapsed.

By Friday night, his attorneys — led by Anthony Falzone, executive director of the Fair Use Project at Stanford University — said they intend to withdraw from the case and said the artist had misled them by fabricating information and destroying other material.

Fairey himself admitted that he didn’t use The Associated Press photo of Obama seated next to actor George Clooney he originally said his work was based on — which he claimed would have been covered under “fair use,” the legal claim that copyrighted work can be used without having to pay for it.

Instead he used a picture the news organization has claimed was his source — a solo picture of the future president seemingly closer to the iconic red, white and blue image of Obama, underlined with the caption “HOPE.” Fairey said that he tried to cover up his error by submitting false images and deleting others.

The distinction is critical because fair use can sometimes be determined by how much of an original image or work was altered in the creation of a new work. If Fairey didn’t need to significantly alter the image he used — in this case the solo shot of Obama — then his claim could have been undermined. Fair use cases also may consider the market value of the copyrighted material and the intended use of the newly created work.

“Shepard Fairey has now been forced to admit that he sued the AP under false pretenses by lying about which AP photograph he used,” said AP vice president and general counsel Srinandan R. Kasi. “Mr. Fairey has also now admitted to the AP that he fabricated and attempted to destroy other evidence in an effort to bolster his fair use case and cover up his previous lies and omissions.”

Kasi said Fairey’s admission struck “at the heart” of Fairey’s defense that he was protected by fair use.

Kasi said the AP would continue to pursue its countersuit alleging that Fairey willfully infringed the AP’s copyright. It was not immediately clear from the statements issued and court filings if Fairey would continue with his case, but a person close to Fairey said that the artist would. The person was not authorized to discuss the case and spoke on condition of anonymity.

Fairey, 39, had claimed he based his “HOPE” drawing on a photo of then-Sen. Obama seated next to Clooney. The photo was taken in April 2006 by Mannie Garcia, on assignment for the AP, at the National Press Club in Washington.

Fairey now says he started with a solo photograph of Obama — taken at the same event, by the same photographer. The AP has long maintained that Fairey used the solo shot for the poster.

Fairey sued the not-for-profit news cooperative in February, arguing that he didn’t violate copyright law because he dramatically changed the image. The AP countersued in March, saying the uncredited, uncompensated use of an AP photo violated copyright laws and signaled a threat to journalism. cm-bd

Fairey, a Los Angeles-based street artist with a long, often proud history of breaking rules, said in a statement Friday that he was wrong about which photo he used and that he tried to hide his error.

“In an attempt to conceal my mistake, I submitted false images and deleted other images,” said Fairey. “I sincerely apologize for my lapse in judgment, and I take full responsibility for my actions, which were mine alone.”

He said he was taking steps to correct the information and regretted that he didn’t come forward sooner.

In addition to indicating they plan to withdraw from the case, attorneys for Fairey papers filed Friday in federal court in Manhattan stating that he misled them. They also amended the original court documents, reflecting that Fairey used a different picture.

“Mr. Fairey was apparently mistaken about the photograph he used when his original complaint for declaratory relief was filed on February 9, 2009,” the papers say. “After the original complaint was filed, Mr. Fairey realized his mistake. Instead of acknowledging that mistake, Mr. Fairey attempted to delete the electronic files he had used in creating the illustration at issue. He also created, and delivered to his counsel for production, new documents to make it appear as though he had used the Clooney photograph as his reference.”

Although he said he was “very sorry to have hurt and disappointed colleagues, friends, and family,” Fairey said that the real issue was “the right to fair use” so artists can create freely.

“Regardless of which of the two images was used,” he said, “the fair use issue should be the same.”

Laurence Pulgram, an intellectual property lawyer who represented Napster in a copyright fight with the rock band Metallica, said Saturday that Fairey’s case was in trouble.

“This was a brain-dead move by Mr. Fairey, and it could be the turning point. His lawyers will still be able to argue that he made a ’fair use’ under copyright law, but it’s a whole lot less likely that the court or jury will think that what he did was actually ’fair’ if he has lied and tried to mislead the entire world about what use he made.”

The dispute between Fairey and the AP has led to a strong debate between artists and free speech advocates defending Fairey and photographers and journalism organizations citing the need for copyright protection.

The “HOPE” image has appeared on countless posters, stickers and buttons. It has appeared in several books and in numerous museums, including a mixed-media stenciled collage version added to the permanent collection of the National Portrait Gallery in Washington.

Fairey also used the AP photograph for an image designed specially for the Obama inaugural committee, which charged anywhere from $100 for a poster to $500 for a poster signed by the artist. It is unclear how much, in total, Fairey may have earned from the design.

Fairey has said that he first designed the image in early 2008, after he was encouraged by the Obama campaign to come up with some kind of artwork.

The AP plans to donate any proceeds received for past use of the photo to the AP Emergency Relief Fund, which assists staffers and their families around the world who are victims of natural disasters and conflicts.

In February 2009, Fairey was arrested when he went to Boston for an event kicking off his solo exhibit at the Institute of Contemporary Art, among the most popular in the museum’s more than 70-year history.

He faced dozens of vandalism charges, but nearly all were dropped. He pleaded guilty to three misdemeanor charges last summer and was sentenced to two years probation.

NEW YORK POST is a registered trademark of NYP Holdings, Inc. nypost.com , nypostonline.com , and newyorkpost.com are trademarks of NYP Holdings, Inc. Copyright 2009 NYP Holdings, Inc. All rights reserved. Privacy | Terms of Use

Op-Ed Columnist
The Reality Moment
NYTIMES
By DAVID BROOKS
October 16, 2009

That which can’t continue doesn’t. A nation can spend and spend, pile debt upon debt, but eventually there comes a reality moment when some leader emerges to say enough is enough and when decent people, looking around at themselves and their own best nature, respond by demanding a return to responsibility.

In the United States, we’re not at that moment yet. Private debt is being replaced by public debt. New entitlements are being created, and the money that could be used to ward off fiscal disaster is being used for other things. Here, Democrats still get ahead by promising tax cuts for the bottom 98 percent and Republicans get ahead by promising tax cuts for all and Medicare cuts for none.

But Britain has hit its reality moment. The Brits are ahead of us when it comes to public indebtedness and national irresponsibility. Spending has been out of control for longer and in a more sustained way.

But in that country, the climate of opinion has turned. There, voters are ready for a politician willing to face reality. And George Osborne, who would become the chancellor of the Exchequer in the likely event that his Conservative Party wins the next election, has aggressively seized the moment.

In a party conference address earlier this month, Osborne gave the speech that an American politician will someday have to give. He said that he is not ideologically hostile to government. “Millions of Britons depend on public services and cannot opt out,” he declared. He defended government workers against those who would deride them as self-serving bureaucrats: “Conservatives should never use lazy rhetoric that belittles those who are employed by the government.”

But, he pivoted, “it is because we treat those who work in our public sector with respect that I want to be straight with you about the choices we face.” The British government needs to cut back.

Osborne declared that his government would raise the retirement age. That age was scheduled to rise at some point in the distant future. Osborne vowed to increase it sometime in the next five to 10 years.

Osborne declared that there would be no tax cuts any time soon. He said that as a matter of principle he believes that the top income tax rate of 50 percent is too high. But, he continued, “we cannot even think of abolishing the 50 percent rate in the rich” while others down the income scale are asked to scrimp.

Osborne offered government workers the same sort of choice that many private sector executives are forced to make. He proposed a public sector pay freeze in order to avoid 100,000 layoffs. He said that the pay freeze would apply to all workers except those making less than £18,000 (nearly $29,000) “because I don’t believe in balancing the budget on the backs of the poorest. Nor do you.”

There were other austerities. Osborne vowed to cut a program he once supported but which has not proved its worth: a baby bond program that was meant to help offset the costs of childhood. There would no longer be means-tested tax credits for families making more than £50,000.

Osborne’s speech was not an isolated event. The Conservatives have treated British voters as adults for a year now, with a string of serious economic positions. The Conservatives supported the Labour government bank bailout, even though it was against their political interest to do so. Last November, Osborne opposed a cut in the value-added taxes on the grounds that the cuts were unaffordable and would not produce growth. It is not easy for any conservative party to oppose tax cuts, but this one did it.

And the public has responded. The Conservatives now have a dominating lead over Labour. Over all, support for the Conservatives rose by 4 percentage points after Osborne’s speech. The polls reveal that nearly 60 percent of Britons support the austerity measures. The Conservatives have a 21-point lead when it comes to being honest about public finances and a 14-point lead on economic policy generally.

The key is that Osborne is not merely offering pain, but a different economic vision — different from Labour and different from the Thatcherism that was designed to meet the problems of the 1980s.

In the U.S., the economic crisis has caused many to question capitalism. But Britain has discredited the center-left agenda with its unrelenting public spending, its public development agencies and disappointing public-private investment partnerships.

Osborne and David Cameron, the party leader, argue that Labour’s decision to centralize power has undermined personal and social responsibility. They are offering a responsibility agenda from top to bottom. Decentralize power so local elected bodies have responsibility. Structure social support to encourage responsible behavior and responsible spending.

If any Republican is looking for a way forward, start by doing what they’re doing across the Atlantic.

Op-Ed Columnist
A Hatchet Job So Bad It’s Good
NYTIMES
By PAUL KRUGMAN
October 16, 2009

In the past, the insurance industry’s power has been a major barrier to health-care reform. Most notably, the industry paid for the infamous “Harry and Louise” ads that helped kill the Clinton plan. But times have changed. Last weekend, the lobbying organization America’s Health Insurance Plans, or AHIP, released a report attacking the reform plan just passed by the Senate Finance Committee. Some news organizations gave the report prominent, uncritical coverage. But health-care experts quickly, and correctly, dismissed it as a hatchet job. And the end result of AHIP’s blunder may be a better bill than we would otherwise have had.

For 2009, it turns out, is not 1993. Once again, Republicans have tried to kill reform with smears and scare stories. But all they seem to have killed with their cries of “socialism” and warnings about “death panels” is their own credibility. Some form of health-care reform is highly likely to pass. So it’s a different game than it was 16 years ago. And it’s a game that the insurance industry apparently doesn’t know how to play.

The motivation for the AHIP report seems to have been the decision by the Finance Committee to weaken the penalties for individuals who don’t sign up for insurance, even as it retains regulations requiring that insurers offer the same policies to everyone, regardless of medical history. The industry worries that some people will game the system, remaining uninsured as long as they’re healthy, then signing up when they get sick.

This is, believe it or not, a valid concern. Many health-care economists believe that a strong individual mandate, requiring that almost everyone sign up, will be needed to make health reform work. And the Finance Committee probably did weaken the mandate too much. But AHIP, apparently unable to help itself, didn’t stop there. Instead, the report threw every anti-reform argument the authors could think of at the wall, hoping that something would stick.

One argument was particularly striking: the claim that attempts to limit Medicare spending would lead to higher insurance premiums. In fact, the report assumes that 100 percent of any reduction in Medicare payments to hospitals will translate into higher costs for patients with private insurance. The only way to justify this claim is to assume that all hospitals are purely charitable institutions, charging as little as they possibly can. Now, some hospitals may fit this description. But all of them?

What’s more, this argument stands the usual logic of markets on its head: if you believe AHIP’s story, competition raises prices instead of reducing them. And it doesn’t matter where the competition comes from: anyone who gets a better deal, whether it’s Medicare or a private insurer, makes life worse for everyone else. I don’t believe that, and neither should you.

Of course, the report doesn’t mention these implications. The only bad competition it talks about is competition from the government. Specifically, it claims that a public insurance option would be a bad thing — not because it would be inefficient, but because the public plan would negotiate better prices. Isn’t that an argument for, not against, such a plan? Which brings us to the ways in which AHIP may have done health reform a favor.

As I said, the individual mandate probably should be stronger than it is in the Finance Committee’s bill. But there’s a reason the mandate was weakened: fear that too many people would balk at the cost of insurance, even with the subsidies provided to lower-income individuals and families. So why not address that cost?

Aside from making the subsidies larger, which they should be, there are at least two changes to the legislation that would help limit costs. First, health exchanges — special, regulated markets in which individuals and small businesses can buy insurance — can be made stronger, in effect giving small buyers a better bargaining position. Second, the public option — missing from the Finance Committee’s bill — can be brought back in, giving private insurers some real competition.

The insurance industry won’t like these changes, but that matters less than it did a week ago.

There’s also another point, which House Speaker Nancy Pelosi has stressed. Part of the opposition to a strong individual mandate comes from the sense that Americans will be forced to buy policies from a greedy insurance industry. Giving people, literally, another option — the right to buy into a public plan instead — would defuse that opposition. Even with stronger exchanges and a public option, health reform would probably increase, not reduce, insurance industry profits. But the insurers wanted it all. The good news is that by overreaching, they may have ensured that they won’t get it.

Young Hamlet’s Agony: Will he listen to Emanuel and Biden or Petraeus and McChrystal?
National Review
By Charles Krauthammer
October 09, 2009, 0:00 a.m.

The genius of democracy is the rotation of power, which forces the opposition to be serious — particularly about things like war, about which until January 20 of this year Democrats were decidedly unserious.

When the Iraq War (which a majority of Senate Democrats voted for) ran into trouble and casualties began to mount, Democrats followed the shifting winds of public opinion and turned decidedly anti-war. But needing political cover because of their post-Vietnam reputation for weakness on national defense, they adopted Afghanistan as their pet war.

“I was part of the 2004 Kerry campaign, which elevated the idea of Afghanistan as ‘the right war’ to conventional Democratic wisdom,” wrote Democratic consultant Bob Shrum shortly after President Obama was elected. “This was accurate as criticism of the Bush administration, but it was also reflexive and perhaps by now even misleading as policy.”

Which is a clever way to say that championing victory in Afghanistan was a contrived and disingenuous policy in which Democrats never seriously believed, a convenient two-by-four with which to bash George Bush over Iraq — while still appearing warlike enough to fend off the soft-on-defense stereotype.

Brilliantly crafted and perfectly cynical, the “Iraq War bad, Afghan War good” posture worked. Democrats first won Congress, then the White House. But now, unfortunately, they must govern. No more games. No more pretense.

So what does their commander in chief do now with the war he once declared had to be won but had been almost criminally under-resourced by Bush?

Perhaps provide the resources to win it?

You would think so. And that’s exactly what Obama’s handpicked commander requested on August 30 — a surge of 30,000 to 40,000 troops to stabilize a downward spiral and save Afghanistan the way a similar surge saved Iraq.

That was more than five weeks ago. Still no response. Obama agonizes publicly as the world watches. Why? Because, explains national-security adviser James Jones, you don’t commit troops before you decide on a strategy.

No strategy? On March 27, flanked by his secretaries of defense and state, the president said this: “Today I’m announcing a comprehensive new strategy for Afghanistan and Pakistan.” He then outlined a civilian-military counterinsurgency campaign to defeat the Taliban in Afghanistan.

And to emphasize his seriousness, the president made clear that he had not arrived casually at this decision. The new strategy, he declared, “marks the conclusion of a careful policy review.”

Conclusion, mind you. Not the beginning. Not a process. The conclusion of an extensive review, the president assured the nation, that included consultation with military commanders and diplomats, with the governments of Afghanistan and Pakistan, with our NATO allies and members of Congress.

The general in charge was then relieved and replaced with Obama’s own choice, Stanley McChrystal. And it’s McChrystal who submitted the request for the 40,000 troops, a request upon which the commander in chief promptly gagged.

The White House began leaking an alternate strategy, apparently proposed (invented?) by Vice President Biden, for achieving immaculate victory with arm’s-length use of cruise missiles, predator drones, and special ops.

The irony is that no one knows more about this kind of warfare than General McChrystal. He was in charge of exactly this kind of “counterterrorism” in Iraq for nearly five years, killing thousands of bad guys in hugely successful under-the-radar operations.

When the world’s expert on this type of counterterrorism warfare recommends precisely the opposite strategy — “counterinsurgency,” meaning a heavy-footprint, population-protecting troop surge — you have the most convincing of cases against counterterrorism by the man who most knows its potential and its limits. And McChrystal was emphatic in his recommendation: To go any other way than counterinsurgency would lose the war.

Yet his commander in chief, young Hamlet, frets, demurs, agonizes. His domestic advisers, led by Rahm Emanuel, tell him if he goes for victory, he’ll become LBJ, the domestic visionary destroyed by a foreign war. His vice president holds out the chimera of painless counterterrorism success.

Against Emanuel and Biden stand David Petraeus, the world’s foremost expert on counterinsurgency (he saved Iraq with it), and Stanley McChrystal, the world’s foremost expert on counterterrorism. Whose recommendation on how to fight would you rely on?

Less than two months ago — August 17 in front of an audience of veterans — the president declared Afghanistan to be “a war of necessity.” Does anything he says remain operative beyond the fading of the audience applause?

The Buck Passes Here
According to Obama’s chorus of whiners, nothing is ever his fault.
National Review
By Victor Davis Hanson
October 06, 2009, 4:00 a.m.

Meet the Obama whiners. “They did it” is the new administration’s credo when things go wrong. Most often, the culprit for disappointment in Obama’s hope-and-change agenda remains George W. Bush — a sort of modern-day fallen angel Azael, whose wickedness is persistent and omnipresent.

Nine months after his departure, the former president insidiously still has his hand in almost everything that seems to plague Barack Obama’s utopian plans. At other times “the Republicans,” “the far Right,” “conservatives,” or even the “mob” have kept America from getting the future it deserves. One would never guess that the Democrats have held the Senate and the House since 2006, own the executive branch, and enjoy the support of the ever-obsequious media.

Instead, demons everywhere are busy at work to stall Obamism.

Civil-rights problems? “Cowards!” Attorney General Eric Holder yells at his countrymen. Energy stasis? “Teenagers!” we Americans are, Energy Secretary Steven Chu sermonizes about the ill-informed electorate. More problems with terrorists? The old bogeyman Bush created a “global war” mindset that served only to “validate al-Qaeda’s twisted worldview” — or so insists the new terrorism czar, John Brennan.

Persistent joblessness? It can only be the aftereffect of the Bush-induced financial panic of over a year ago — not past bipartisan criminality at Freddie Mac and Fannie Mae, or present failed stimuli, or massive deficits, or the current climate of chronic uncertainty, given that business has no idea of the cost of promised high taxes to come, health-care reform to come, cap-and-trade to come, or anything else to come. We have forgotten that John Kerry ran in 2004 on the notion of a Bush-induced “jobless recovery” — when unemployment was at 5.4 percent, just a little more than half of what it is currently.

Obama’s signature health-care reform is being stalled by mob-like right-wing tea parties and town-hall racists who have mysteriously nullified Democratic majorities in Congress. Few fault Obama’s insane idea of outsourcing the reform bill to the Democratic House and Senate, which cobbled together an unreadable 1,000-page free-for-all spending mess at a time of a $2 trillion deficit.

The failure to charm Russia, denuclearize Iran, or commit to Afghanistan? All these problems likewise persist because of George W. Bush, who antagonized the misunderstood Putin, wanted to “wage war” against a troubled Ahmadinejad, and “took his eye off the ball” in regard to the “necessary war” against the Taliban. Even when we push the reset button, Bush still manages somehow to confound the new diplomacy and prevents the Russians from helping with a mysteriously stubborn Iran.

Supposedly outspoken generals like Stanley McChrystal are fouling up administration policies in Afghanistan, getting dangerously close to tipping the balance between civilian and military authority — not at all like the noble “revolt of the generals” during the Bush-era controversy over the surge, when dozens of high-ranking officers, present and past, took turns, candidly or stealthily, trashing the chief executive.

Obama jetted in to Copenhagen to lobby for a Chicago Olympics. He spent a little over an hour there. Both he and Michelle wowed Europeans with inspirational stories from their Chicago neighborhoods. Most of the anecdotes proved implausible or inane: Michelle sitting on her father’s knee (at 20?) watching Carl Lewis, or learning from her dad to throw a right hook (at a time when the world was watching YouTube snippets of a wild Chicago street slugfest). Obama found himself playing the role of a 19th-century Irish pol finagling for the home tribe — at a time when the natural consequence of his serial apologies and postmodern transnational rhetoric would be the selection of Rio as host to the 2016 games.

No matter. It was Bush who lost Chicago its sure-thing bid — literally, according to Illinois senator Roland Burris. He claimed that the judges were still angry at Bush’s America, rather than peeved that Europeans were being treated by Barack and Michelle almost like teeny-boppers at a Beatles concert who were supposed to weep in adulation and seek autographs.

State Rep. Susana Mendoza (D., Chicago) added, “I feel in my gut that this vote today was political and mean-spirited. I travel a lot. . . . I thought we had really turned a corner with the election of President Obama. People are so much more welcoming of Americans now. But this isn’t the people of those countries. This is the leaders still living with outdated impressions of Americans.”

The president unwisely boasted upon coming into office that he would close Guantanamo within a year. He apparently forgot that Bush had wanted to phase out the detention center since 2006, but faced a bad/worse choice of having to put unrepentant out-of-uniform terrorists somewhere else.

So when Obama soon discovered the same existential challenges that had plagued his predecessor, his administration immediately came up with a “Bush did it” excuse. Here is Obama’s Guantanamo czar, Greg Craig: “I thought there was, in fact, and I may have been wrong, a broad consensus about the importance to our national security objectives to close Guantanamo and how keeping Guantanamo open actually did damage to our national-security objectives.” Craig still has not fathomed that it was a Congress controlled by the Democrats that balked at the administration’s promise.

Throughout the campaign Barack Obama called for an end to the “Don’t ask, don’t tell” policy on gays in the military. That won him ample support from the homosexual community. And now? The two Bush wars apparently prevent him from following through on that promise as well. The national-security adviser, Gen. James Jones, complains that there is “an awful lot on his desk. I know this is an issue that he intends to take on at the appropriate time.” Apparently we were not fighting in Iraq and Afghanistan when Obama made his grandiose campaign pledge.

There is a growing credibility problem with this young administration. When Barack Obama promises a public option in health-care reform, or the passage of such legislation before the August break, or a renewed commitment to the necessary war in Afghanistan, or an end to lobbyists in government, or a new transparency, no one believes any of it anymore. Even worse, we know that the broken promises and policy mishaps will always be someone else’s fault.

The problem with all this is that while Americans may tire of duplicity, they hate whining with a passion. Harry Truman became a folk hero for not blaming others for the myriad of crises that he inherited. In contrast, Barack Obama’s legacy is shaping up as “The Buck Passes Here.”

George Will endorsed Obama in the last election, remember...
Count on More Bad Climate 'News'

By GEORGE F. WILL
Last Updated: 12:36 AM, October 3, 2009
Posted: 12:36 AM, October 3, 2009

"Plateau in Temperatures Adds Difficulty To Task Of Reaching a Solution"
-- The New York Times, Sept. 23

IN this headline on a Times story about difficulties confronting people alarmed about global warming, note the word "plateau." It dismisses the unpleasant -- to some people -- fact that global warming is maddeningly (to the same people) slow to vindicate their apocalyptic warnings about it.

The "difficulty" -- the "intricate challenge," the Times says -- is "building momentum" for carbon reduction "when global temperatures have been relatively stable for a decade and may even drop in the next few years." That was in the Times' first paragraph.

In the fifth paragraph, a "few years" became "the next decade or so," according to Mojib Latif, a German "prize-winning climate and ocean scientist" who campaigns constantly to promote policies combating global warming. Actually, Latif has said he anticipates "maybe even two" decades in which temperatures cool.

But stay with the Times' "decade or so." By asserting that the absence of significant warming since 1998 is a mere "plateau," not warming's apogee, the Times assures readers who are alarmed about climate change that the paper knows the future and that warming will continue: Don't de spair, bad news will resume.

The Times reported that "scientists" -- all of them? -- say the 11 years of temperature stability has "no bearing," none, on long-term warming. Some scientists say "cool stretches are inevitable." Others say there may be growth of Arctic sea ice, but the growth will be "temporary." According to the Times, however, "scientists" say that "trying to communicate such scientific nuances to the public -- and to policymakers -- can be frustrating."

The Times says "a short-term trend gives ammunition to skeptics of climate change." Actually, what makes skeptics skeptical is the accumulating evidence that theories predicting catastrophe from man-made climate change are impervious to evidence. The theories are unfalsifiable, at least in the "short run." And the "short run" is defined as however many decades must pass until the evidence begins to fit the hypotheses.

Warnings about cataclysmic warming increase in stridency as evidence of warming becomes more elusive. A recent report from the UN Environment Program predicts an enormous 6.3 degrees Fahrenheit increase by the end of the century even if nations fulfill their most ambi tious pledges concerning re duction of carbon emissions. The US goal is an 80 percent reduction by 2050. But Steven Hayward of American Enterprise Institute says that would require reducing greenhouse-gas emissions to the 1910 level. On a per-capita basis, it would mean emissions approximately equal to those in 1875.

That won't happen. So, we are doomed. So, why try?

America needs a national commission appointed to assess the evidence about climate change. Alarmists will fight this because the first casualty would be the carefully cultivated and media-reinforced myth of consensus -- the assertion that no reputable scientist doubts the gravity of the crisis, doubt being conclusive evidence of disreputable motives or intellectual qualifications.

President Obama, however, could support such a commission because he is sure "there's finally widespread recognition of the urgency of the challenge before us."

So he announced at the UN climate-change summit, where he said the threat is so "serious" and "urgent" that unless all nations act "boldly, swiftly and together" -- "time . . . is running out" -- we risk "irreversible catastrophe." Prince Charles agrees. In March, he said humanity had 100 months -- until July 2017 -- to prevent "catastrophic climate change and the unimaginable horrors that this would bring." Evidently humanity will prevent this.

Charles Moore of the Spectator notes that in July, the prince said that by 2050 the planet will be imperiled by the existence of 9 billion people, a large portion of them consuming as much as Western people now do. Environmental Cassandras must be careful with their predictions, lest they commit the unpardonable faux pas of denying that the world is coming to an end.

Germany takes a right turn
NYPOST
By RALPH PETERS
Last Updated: 3:10 AM, September 29, 2009
Posted: 1:14 AM, September 29, 2009

On Sunday, German voters elected their most business-friendly, pro-American government in decades. Angela Merkel -- the leading grown-up on the world stage -- returns as chancellor.

Merkel's Christian Democrats and Christian Social Union (her party's Bavarian branch) actually lost a few seats, but the pro-business, Washington-friendly Free Democrats roared back to life and more than made up the difference.

On the other hand, the Social Democrats -- Germany's establishment lefties -- took their worst beating in post-war history. The hard-left Greens fell, too. Only the nut-case Left Party gained a bit of ground, thanks to protest votes.

Moscow's unhappy, but resigned. The Kremlin misses former Chancellor Gerhard Schroeder, who did all he could to save Saddam, put Russia's interests above Germany's own -- and then went to work for a Russian energy company after leaving office.

Turkey's angry. No-nonsense Merkel's no multicultural mama. She doesn't want the Middle East dragged inside the EU.

President Obama may believe that Islam shaped America, but Merkel -- a Lutheran pastor's daughter who, as a teenager in East Germany, chose her faith over Communist Party privileges -- realizes that Germany's had enough trouble without dragging Mohammed into things. And her German supporters are sick of being told they have to indulge Muslim immigrants who behave barbarically.

Al Qaeda's disgusted. The terrorists released a series of videos prior to the balloting, warning Germans to vote for surrender, or face the consequences.

The videos backfired. Germans aren't crazy about their Afghan involvement, but they don't like threats to scratch the Mercedes.

Washington's relieved. Even though Obama doesn't share Merkel's deep suspicion of socialist pie-in-the-sky, he knows she won't desert him on Afghanistan. And she'll give our president top-cover on terror (I didn't want to renew the Patriot Act, but Tante Angie made me do it. . .).

Germans don't want to give up their government benefits -- but they understand that benefits have to be paid for. They voted for honest accounting and fiscal discipline. (We may be carefree, but they're serious about their national debt.)

Germans trust and respect Merkel (despite her maiden-aunt appearance, she has a doctorate in quantum chemistry). Her party got a mild spanking because, hampered by a "grand coalition," it didn't act tough enough. Germans want her to continue as chancellor -- with a free hand to get things done. In their political system, a vote for the Free Democrats was a vote to strengthen Merkel.

This election's sob story is the fall of the Social Democrats, whose share of the vote collapsed to 23 percent. Once upon a time, the party produced the likes of Helmut Schmidt and Willy Brandt -- men willing to stand up to the Kremlin. But after the Berlin Wall came down, the socialists lost their way, kneeling to Moscow, backing business deals with dictators and pandering to immigrant minorities at the expense of Herr Meier (the German Joe Six-pack).

Now Merkel's Christian Democrats and her Free Democrat partners have a mandate for leadership backed by conservative majorities in both houses of parliament. This election extends the Euro-trend toward common-sense conservatism that began with the election of President Nicolas Sarkozy, France's most pro-American president ever.

If the trend continues, we may even get a pro-American president in Washington.

Op-Ed Columnist
The Next Culture War
NYTIMES
By DAVID BROOKS
September 29, 2009

Centuries ago, historians came up with a classic theory to explain the rise and decline of nations. The theory was that great nations start out tough-minded and energetic. Toughness and energy lead to wealth and power. Wealth and power lead to affluence and luxury. Affluence and luxury lead to decadence, corruption and decline.

“Human nature, in no form of it, could ever bear prosperity,” John Adams wrote in a letter to Thomas Jefferson, warning against the coming corruption of his country.

Yet despite its amazing wealth, the United States has generally remained immune to this cycle. American living standards surpassed European living standards as early as 1740. But in the U.S., affluence did not lead to indulgence and decline.

That’s because despite the country’s notorious materialism, there has always been a countervailing stream of sound economic values. The early settlers believed in Calvinist restraint. The pioneers volunteered for brutal hardship during their treks out west. Waves of immigrant parents worked hard and practiced self-denial so their children could succeed. Government was limited and did not protect people from the consequences of their actions, thus enforcing discipline and restraint.

When economic values did erode, the ruling establishment tried to restore balance. After the Gilded Age, Theodore Roosevelt (who ventured west to counteract the softness of his upbringing) led a crackdown on financial self-indulgence. The Protestant establishment had many failings, but it was not decadent. The old WASPs were notoriously cheap, sent their children to Spartan boarding schools, and insisted on financial sobriety.

Over the past few years, however, there clearly has been an erosion in the country’s financial values. This erosion has happened at a time when the country’s cultural monitors were busy with other things. They were off fighting a culture war about prayer in schools, “Piss Christ” and the theory of evolution. They were arguing about sex and the separation of church and state, oblivious to the large erosion of economic values happening under their feet.

Evidence of this shift in values is all around. Some of the signs are seemingly innocuous. States around the country began sponsoring lotteries: government-approved gambling that extracts its largest toll from the poor. Executives and hedge fund managers began bragging about compensation packages that would have been considered shameful a few decades before. Chain restaurants went into supersize mode, offering gigantic portions that would have been considered socially unacceptable to an earlier generation.

Other signs are bigger. As William Galston of the Brookings Institution has noted, in the three decades between 1950 and 1980, personal consumption was remarkably stable, amounting to about 62 percent of G.D.P. In the next three decades, it shot upward, reaching 70 percent of G.D.P. in 2008.

During this period, debt exploded. In 1960, Americans’ personal debt amounted to about 55 percent of national income. By 2007, Americans’ personal debt had surged to 133 percent of national income.

Over the past few months, those debt levels have begun to come down. But that doesn’t mean we’ve re-established standards of personal restraint. We’ve simply shifted from private debt to public debt. By 2019, federal debt will amount to an amazing 83 percent of G.D.P. (before counting the costs of health reform and everything else). By that year, interest payments alone on the federal debt will cost $803 billion.

These may seem like dry numbers, mostly of concern to budget wonks. But these numbers are the outward sign of a values shift. If there is to be a correction, it will require a moral and cultural movement. Our current cultural politics are organized by the obsolete culture war, which has put secular liberals on one side and religious conservatives on the other. But the slide in economic morality afflicted Red and Blue America equally.

If there is to be a movement to restore economic values, it will have to cut across the current taxonomies. Its goal will be to make the U.S. again a producer economy, not a consumer economy. It will champion a return to financial self-restraint, large and small. It will have to take on what you might call the lobbyist ethos — the righteous conviction held by everybody from AARP to the agribusinesses that their groups are entitled to every possible appropriation, regardless of the larger public cost. It will have to take on the self-indulgent popular demand for low taxes and high spending.

A crusade for economic self-restraint would have to rearrange the current alliances and embrace policies like energy taxes and spending cuts that are now deemed politically impossible. But this sort of moral revival is what the country actually needs.

Passive-Aggressive at the U.N.: Obama boldly proclaims a new meekness.
Weekly Standard
by Andrew Ferguson
10/05/2009, Volume 015, Issue 03

In his speech to the United Nations last week, President Obama really broke the presidential pattern. At a glance these annual turns before the General Assembly are all alike. The president stands alone, dwarfed by the absurdly outsized dais angled together from blue-green granite, while the extravagantly dressed audience sits through long stretches of stony silence. The speech itself is always grandiose. Even back in the 1990s, when the world appeared to be going swimmingly, relatively speaking, the president of the United States felt he had to inform the assembled nations about "the great challenges" that "still confront us."

It's a safe bet that great challenges will be confronting us, because even if they weren't, the world's political and diplomatic leaders would invent them to keep themselves busy. Boldly (always boldly) asserting the existence of such challenges lends an urgency that earns the president's speech a mention on the evening news, at least. And it makes the president appear indispensable--not only as the man who calls the world's attention to great challenges but also as the man who, with help from his attendants, will wrestle the challenges to the ground.

Or so it usually went, until last week. This time the new president, in his U.N. debut, tried something altogether different. He worked hard to present himself as just one of the guys--one more world leader yakking it up with all the other world leaders down at the bar at the World Leaders Club.

He began the speech conventionally enough, by proclaiming a bold challenge. "The time has come for the world to move in a new direction." What challenge could be bolder than moving the world in a direction? So far, so normal. But note the passive voice. There was no we moving the world, and certainly no I. The world would be moving itself.

"No one nation can or should try to dominate another nation," he said, by way of explaining this strange unmoved movement. "No world order that elevates one nation or group of people over another will succeed." The bipolar world of the "long-gone Cold War," in which two powerful nations pushed or pulled the world this way or that, is no longer possible, he said. And then he went an unexpected step further: Even the unipolar world, in which one country assumes leadership by virtue of its wealth or moral standing, isn't going to work, either. The president himself would see to that, by relinquishing any claim to indispensability. He was introducing us to the no-polar world.

In the no-polar world, according to the president, everybody is doing everything all at once. "Persistent action," the president called it. "The future will be forged by deeds and not simply words." The deeds, however, will entail a great many words; on most occasions, words exclusively. There will be summits, conferences, negotiations, and consultations. And in this important work, "America intends to keep our end of the bargain," which isn't to say we'll be bossing anybody around.

Take, for instance, the issue of nuclear disarmament. Boldly the president pledged that the United States would "pursue a new agreement with Russia." We would "work with others" to enforce a treaty after we "move forward with ratification." We would "complete a Nuclear Posture Review." And we would "call upon countries to begin negotiations." Pursuing, reviewing, working with, moving forward, and calling upon--dirty work, but somebody has to do it. And when all this labor has ended, the president promised, he will "host a summit" that "will work to strengthen the institutions and initiatives that combat" nuclear proliferation. (The word "combat" was not meant to be an endorsement of violence.) The sentence from the speech that best expresses our new no-polar world was this one: "We will develop regional initiatives with multilateral participation, alongside bilateral negotiations."

We've been told that most presidents appear to the rest of the world to be too aggressive, especially if they're Republicans, and especially when they stand before the General Assembly on that silly dais, talking grandly. But at the U.N. last week the world got its first look at a passive-aggressive president. For now Obama's co-leaders like their new colleague. They rewarded his speech with applause on thirteen occasions. (In his speech to the General Assembly last year, our previous president, Mr. Aggressive-aggressive, wasn't interrupted by applause at all, not once.) Hugo Chávez of Venezuela said he'd been particularly moved by Obama's vision.

Yet there's a kink in the logic of the president's performance, and it will become hard to ignore. For his speech was a particularly grandiose refusal to be grandiose--a high-handed refusal to be high-handed. Who is he, after all, to declare a no-polar world? Only the leader of the most powerful nation in the world would have the nerve to announce to the world that from now on, by his decree, no nation will be more powerful than any other. The declaration subverts itself, cancels itself out, as he'll discover when he comes to reap the dividends of his new no-polar world.

"Those who used to chastise America for acting alone," the president insisted, "cannot now stand by and wait for America to solve the world's problems alone." It's only a matter of time before the other guys at the bar start to think: Oh really? Who are you to say we can't?

And what are you going to do about it?

Andrew Ferguson is a senior editor at THE WEEKLY STANDARD.

Score One for the Diplomats
NYTIMES
By GAIL COLLINS, Op-Ed Columnist
September 26, 2009

We are gathered here today to praise the United Nations, not to make fun of it.

Although it’s sort of hard to resist when you’ve got Col. Muammar el-Qaddafi working on a plan to dismember Switzerland. This thought is not central to my argument about the U.N., but we live in troubling times and it might be very soothing to stop worrying about Iran for a while and listen to world leaders argue about the Swiss Menace.

The president of Switzerland, Hans-Rudolf Merz, paid a conciliation call on Qaddafi, who is camping out at the Libyan Embassy in New York City this week after literally being unable to find a patch of ground on which to pitch his tent. Merz has been trying to get Libya to spring two Swiss businessmen, who have been stuck in Tripoli since 2008, when Qaddafi decided that Switzerland is a “world mafia and not a state.” He also withdrew Libya’s assets from Swiss banks, recalled his diplomats and closed the Nestlé office in Tripoli.

This would be immediately after the Geneva police arrested Qaddafi’s son Hannibal and his wife for beating two servants with a coat hanger and belt while they were staying in one of the city’s luxury hotels. The servants later withdrew their complaint after receiving what The Associated Press said was “compensation from an undisclosed source.”

Unappeased, Qaddafi submitted a U.N. proposal to abolish Switzerland altogether and divide the territory among its next-door neighbors.

Hannibal has an interesting résumé, which includes being picked up in Paris for drunken driving at 90 miles per hour on the wrong side of the Champs Élysées. On another occasion, he was taken into custody by French police after he allegedly pulled a gun on officers who came to his hotel room to investigate reports that he was beating his girlfriend. After he was released, he was quickly arrested again in another hotel for breaking up the furniture. Perhaps he has a problem with rented rooms.

But we digress. About the United Nations: For eight years, the Bush White House regarded the U.N. mainly as an annoyance, a mole in the garden of the new American world order. Now we are in the age of the Obama, and trying to once again play well with others.

Qaddafi’s weird performance before the General Assembly on opening day was a bit of a blow to the American plan to deal with the U.N. seriously, although the 96-minute speech may have suffered from the fact that his translator collapsed somewhere into the second hour. But things improved a lot when Obama got the Security Council to pass a resolution on nuclear proliferation, just before he and the leaders of Britain and France dramatically blew the whistle on Iran for hiding a second uranium-enrichment plant from U.N. nuclear inspectors.

The resolution encourages member nations to consider whether the folks who buy their nuclear technology are allowing the U.N. to keep track of what they’re doing with it. It also encourages nations to get their nuclear materials secure within four years.

There has never been so much encouragement this side of elementary school tee-ball leagues. Basically, the Security Council resolved that it would be really keen if members refrained from selling nuclear bomb kits to just anybody who happened to show up at the door.

There are two ways to look at this. One is that it just goes to show that the U.N. can’t really step up to the plate. “Fluff and stuff,” grumbled John Bolton, the U.N.-hating U.N. ambassador during the Bush administration.

The other is to feel that while the United Nations can be feckless and frustrating, it’s not any more so than, say, the United States Senate, which has been busy this week trying to make sure that health reform does not involve anything that might really work.

Legislative bodies are maddening, even when they’re made up of people from the same country. In fact, if the United Nations was the New York State Senate, instead of passing a semi-toothless resolution, the Security Council members would have started locking the doors on each other and arguing about whether France could be counted as part of a quorum if its delegate just walked across the room to get a cup of coffee.

If it was the Connecticut House of Representatives, China and Russia would have been too busy playing solitaire on their computers to pay attention. The State Legislature in Hartford was recently embarrassed by pictures of two lawmakers playing card games on their state-issued laptops during a late-night budget debate. However, if the U.N. had handed out similar equipment to the General Assembly, there might have been a lot more people hanging around through that Qaddafi speech.

Anyhow, I’m thinking — good work, Security Council. At least it wasn’t a study commission.

A Whiskey Tango Foxtrot Presidency? The choice to succeed or fail in Afghanistan is Obama's.
Weekly Standard
by William Kristol
09/21/2009, Volume 015, Issue 01

The single most damning story about President Obama so far is one we know courtesy of his national security adviser, Jim Jones. Visiting the newly installed military commanders in Afghanistan in late June, Jones told General Stanley McChrystal that if he requested more troops any time soon, Obama would have a "Whiskey Tango Foxtrot" (i.e., "What the f--") moment. Jones then, in an interview, made the claim--denied by everyone else involved--that military leaders had agreed that when the president earlier sent 21,000 troops to Afghanistan, "there would be a year from the time the decision was made before they would ever come back and ask for any more."

Okay. Jones is in way over his head. And, we gather, he'll likely be gone by Christmas. But it's still a remarkable statement by the president's national security adviser. Afghanistan is a war Obama supported repeatedly as a candidate. One of his first acts as president was to recommit to success in the struggle. Yet Jones was willing to portray his boss, both privately and publicly, as timid and fearful of tough decisions.

What's worrisome is that most of Obama's senior advisers seem to be on the same page as Jones. We hear that Rahm Emanuel is counseling the president to figure out how to get out of Afghanistan rather than how to win. He's convinced that this is Vietnam redux, and that his job is to prevent Obama from going down the path of LBJ. The president's grand poobah for Afghanistan and Pakistan, Richard Holbrooke, who was shaped by his experiences as a young foreign service officer in Vietnam, has weighed in behind the scenes against McChrystal's coming request for more troops. Meanwhile, congressional Democrats, led by House speaker Nancy Pelosi and Senate Armed Services Committee chairman Carl Levin, are falling all over each other searching for the exits.

Of course this wing of the Democratic party--the dominant McGovern-Carter wing--has been wrong about just about everything in foreign policy over the last three decades. So maybe President Obama should look for guidance to another kind of Democrat. House Armed Services chairman Ike Skelton would be a good choice.

He is a 77-year-old Missourian in the Harry Truman tradition (indeed, his father was a good friend of Truman's). Last week, on the eve of the anniversary of 9/11, Skelton put out a statement titled "Americans Must Not Forget Why We Are In Afghanistan":

America's security depends on our success in denying al Qaeda breathing room to plot future attacks on the U.S. and our allies. . . . Tragically, the attacks of September 11, 2001, were not al Qaeda's first acts of war against the United States. The same plotters were behind the 1993 attacks on the World Trade Center, the 1996 bombing of the Khobar Towers, the 1998 U.S. Embassy bombings in Tanzania and Kenya, and the attack on the USS Cole in the year 2000. And given the opportunity, al Qaeda would attack us again. We must keep al Qaeda on the run, as we have since 9/11.

Skelton reminded the president that "Now is not the time to lose our resolve. We must give our forces the time and resources they need to show progress in the fight against the enemies responsible for the attacks of 9/11."

General McChrystal and his boss, General David Petraeus, with the support of Secretary of Defense Robert Gates, are about to request additional forces needed to prevail in Afghanistan. We trust the president will approve their request--and if higher to lower risk options are presented, that he will choose the lowest risk option. That is, the option most likely to produce decisive results the most quickly.

The president must understand that this war is eminently winnable. He must understand what would be the consequences of retreat from the theater from which we were attacked eight years ago--for Afghanistan, for Pakistan, and around the world. Emanuel might want Obama to avoid being LBJ. But if Obama pulls out he will be Jimmy Carter--a post-9/11 Jimmy Carter. Not a recipe for a successful presidency.

This decision really shouldn't be based on politics. Obama should, as Ike Skelton suggests, remember 9/11. Previous generations of Americans remembered the Alamo and the Maine and Pearl Harbor. Surely this generation of Americans can remember 9/11 and act on the memory by winning the war in Afghanistan.

It's up to Barack Obama. Surely he doesn't want to be remembered for a Whisky Tango Foxtrot presidency?

Does He Lie? No, but Obama implies, misdirects, and misleads.
Washington Post
By Charles Krauthammer
September 18, 2009, 0:00 a.m.

You lie? No. Barack Obama doesn’t lie. He’s too subtle for that. He . . . well, you judge.

Herewith three examples within a single speech — the now-famous Obama-Wilson “you lie” address to Congress on health care — of Obama’s relationship with truth.

(1) “I will not sign (a plan),” he solemnly pledged, “if it adds one dime to the deficit, now or in the future. Period.”

Wonderful. The president seems serious, veto-ready, determined to hold the line. Until, notes Harvard economist Greg Mankiw, you get to Obama’s very next sentence: “And to prove that I’m serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promised don’t materialize.”

This apparent strengthening of the pledge brilliantly and deceptively undermines it. What Obama suggests is that his plan will require mandatory spending cuts if the current rosy projections prove false. But there’s absolutely nothing automatic about such cuts. Every Congress is sovereign. Nothing enacted today will force a future Congress or a future president to make any cuts in any spending, mandatory or not.

Just look at the supposedly automatic Medicare cuts contained in the Sustainable Growth Rate formula enacted to constrain out-of-control Medicare spending. Every year since 2003, Congress has waived the cuts.

Mankiw puts the Obama bait-and-switch in plain language. “Translation: I promise to fix the problem. And if I do not fix the problem now, I will fix it later, or some future president will, after I am long gone. I promise he will. Absolutely, positively, I am committed to that future president fixing the problem. You can count on it. Would I lie to you?”

(2) And then there’s the famous contretemps about health insurance for illegal immigrants. Obama said they would not be insured. Well, all four committee-passed bills in Congress allow illegal immigrants to take part in the proposed Health Insurance Exchange.

But more importantly, the problem is that laws are not self-enforcing. If they were, we’d have no illegal immigrants because, as I understand it, it’s illegal to enter the United States illegally. We have laws against burglary, too. But we also provide for cops and jails on the assumption that most burglars don’t voluntarily turn themselves in.

When Republicans proposed requiring proof of citizenship, the Democrats twice voted that down in committee. Indeed, after Rep. Joe Wilson’s “You lie!” shout-out, the Senate Finance Committee revisited the language of its bill to prevent illegal immigrants from getting any federal benefits. Why would the Finance Committee fix a nonexistent problem?

(3) Obama said he would largely solve the insoluble cost problem of Obamacare by eliminating “hundreds of billions of dollars in waste and fraud” from Medicare.

That’s not a lie. That’s not even deception. That’s just an insult to our intelligence. Waste, fraud, and abuse — Meg Greenfield once called this phrase “the dread big three” — as the all-purpose piggy bank for budget savings has been a joke since Jimmy Carter first used it in 1977.

Moreover, if half a trillion is waiting to be squeezed painlessly out of Medicare, why wait for health-care reform? If, as Obama repeatedly insists, Medicare overspending is breaking the budget, why hasn’t he gotten started on the painless billions in “waste and fraud” savings?

Obama doesn’t lie. He merely elides, gliding from one dubious assertion to another. This has been the story throughout his whole health-care crusade. Its original premise was that our current financial crisis was rooted in neglect of three things — energy, education, and health care. That transparent attempt to exploit Emanuel’s Law — a crisis is a terrible thing to waste — failed for health care because no one is stupid enough to believe that the 2008 financial collapse was caused by a lack of universal health care.

So on to the next gambit: selling health-care reform as a cure for the deficit. When that was exploded by the Congressional Budget Office’s demonstration of staggering Obamacare deficits, Obama tried a new tack: selling his plan as revenue-neutral insurance reform — until the revenue neutrality is exposed as phony future cuts and chimerical waste and fraud.

Obama doesn’t lie. He implies, he misdirects, he misleads — so fluidly and incessantly that he risks transmuting eloquence into mere slickness.

Slickness wasn’t fatal to “Slick Willie” Clinton because he possessed a winning, near-irresistible charm. Obama’s persona is more cool, distant, imperial. The charming scoundrel can get away with endless deception; the righteous redeemer cannot.

— Charles Krauthammer is a nationally syndicated columnist. © 2009, The Washington Post Writers Group

PRUDEN: At the top of the televangelist's game
Washington Times
Wesley Pruden
Friday, September 11, 2009

OPINION/ANALYSIS:

Barack Obama did what he does best. Billy Graham once said Bill Clinton could make a great evangelist, but Bubba's not a patch on this president. Mr. Obama early on mastered the cadence of the black church - dropping his voice on the last word of the sentence to make the listener pay attention - and he understands the power of language. He speaks great prose. He understands that a televangelist concentrates on sales, not substance.

The president was on his game Wednesday night, soaring with a promise of partisan geniality and finishing with the resurrection of a corpse. No one in the House chamber would have been surprised if Teddy Kennedy had walked in from Arlington National Cemetery to lead the applause.

"The time for bickering is over," he said. "Now is when we must bring the best ideas of both parties together, and show the American people that we can still do what we were sent here to do."

The faux humility - the appeal to his Republican "friends" - was intended to seduce the independents who have been deserting his game for weeks. The Republicans contributed to the emotionalism of the evening with an outburst of frustration and bad manners - "You lie!" - that was unexpected manna from Democratic heaven. The ferocity of the media exploitation of the incident reveals the desperation of the Democrats to find something, anything, to stop the bleeding. (Rahm Emanuel, the president's chief of staff, calls Rep. Joe Wilson's shout-out unique in American history, demonstrating once more how little this administration knows of the history of America and the 57 states beyond the Chicago city limits.

But neither the resurrection of Teddy Kennedy nor the exploitation of bad manners is likely to change things. Everyone expected the president to offer something to change the debate but what he delivered was warmed-up leftovers.

If the president and his party were serious about "showing the American people that we can still do what we were sent here to do," he would trash Obamacare, whatever it is, and start over. He could start by applying some of his concern with Wall Street greed to the greed of the tort lawyers who have turned the courts into a casino with payouts that lottery winners envy. Fat chance.

Mr. Obama offered "demonstration projects" in a few states to test ideas for "reforming" the medical malpractice abuses that are driving up the price of medicines and persuading doctors to move their shingles from one state to another, seeking relief. This is the "reform" that tort lawyers, on whom Democratic candidates feed like maggots on roadkill, could cheerfully abide. They know that nothing would come of it because the right honorable senators would kill a serious threat to the casino.

The few details of health care reform laid out Wednesday night differ only superficially from the details that trickled out over the summer, the gasoline on a grass-roots fire. The little that was new Wednesday night seemed taken from the scheme proposed earlier in the week by Sen. Max Baucus, chairman of one of the committees writing reform legislation. Mr. Baucus proposes penalties ranging to $3,800 on families without mandatory health care insurance. If the Baucus scheme works, it could be applied to other public policy dilemmas. We could cure homelessness, for example, by imposing stiff fines on the homeless who refuse to buy houses. (That would spur the housing market, too.)

The temper and tone of Mr. Obama's remarks was scolding for everyone who disagrees with him, offering to resolve angry argument by requiring those who disagree with him to change their naughty minds. He attempted to hoodwink his own flanks with a little televangelistic magic, too. He appeared to defend the so-called "public option," which for the unregenerate left is nonnegotiable. He knows this is an empty promise, too. Democratic votes will doom that. Soon we'll see who hits the sawdust when the president makes his altar call. That's the test of every evangelist.

Barack Obama studied law at Harvard, not Yale, as I wrote earlier this week. Apologies to both Harvard and Yale. I was distracted by the boola-boola from the White House.

Wesley Pruden is editor emeritus of The Washington Times.

A dandy speech - if truth doesn't matter
National Review
By RICH LOWRY
Last Updated: 5:24 AM, September 10, 2009
Posted: 3:56 AM, September 10, 2009

President Obama wants to rewrite the calendar. As far as he's concerned, the year has progressed from June to July to September. August is to be forever erased from our minds and our hearts. His speech to a joint session of Congress was delivered as if the late unpleasantness of last month never happened, or as if it were all simply "bickering" and "games" on the otherwise smooth, consensual path to reordering one-sixth of the nation's economy in one fell swoop.

"Now is the season for action," Obama intoned.

In other words, please don't bother me with your inconvenient Congressional Budget Office reports, with your tiresome concerns about ballooning government in an era of exploding debt, with your facts -- yes, the House bill would end up covering abortion -- that I prefer to deny. Now is the time for all good men to vote with me or get out of the way. Obama mouthed his usual platitudes about drawing ideas from Republicans and seeking common ground.

By implication, he characterized Republican opposition to his plan as devoid of "facts and reason," even as he called for civil debate.

And he ended his speech with a long, heartfelt passage defending government activism as essential to the national character. This was the speech of an ideologue posing as a pragmatist. Of course, it was an able and spirited performance. Obama with a TelePrompTer is like Yo-Yo Ma with a cello. In the near term, the speech might even help him. But circumstances are different than his storied oratorical performances of the past. Now his rhetoric is tethered to 1,000-page legislation that bears little relation to his key representations.

For such a reputedly fine, nuanced policy mind, Obama can't get basic things right about his party's proposals. Last night, he again insisted that the Democratic plans will reduce health-care costs when there is no serious mechanism to do so (outside eventual rationing, although Obama insists that will never happen). Obama said more preventive care saves money, when it isn't so.

He relied on an intentionally misleading formulation to reassure people that they wouldn't have their current arrangements disrupted.

"Nothing in our plan [requires] you to change what you have," Obama said, twice. True enough, but note the cagey choice of words. It wouldn't be mandated by law, but the effect of the plans would be to detach millions from their current coverage.

Obama portrays the Democratic proposals as utterly cost-free. They won't add to the deficit and they will be paid for painlessly. In language that will be closely parsed, Obama strongly defended the public option, but also said it's only one part of his plan. He wants to forestall a progressive revolt in the House over the public option, evidently doomed in the Senate. But besides this, there was little the left wouldn't love. For weeks, it has urged the president to get more confrontational and adamant.

Last night, Obama signaled that he will happily bulldoze an opposition that he believes deserves its fate. So, in the face of a skeptical public, he and his Democrats will set about pushing through a massive, Great Society-style program all by themselves.

As they relegate August to the memory hole.

Coruscating on Thin Ice: The Obama administration is young and out of touch.

By PEGGY NOONAN
SEPTEMBER 3, 2009, 8:22 P.M. ET

At a speech in Colorado someone asked if I was concerned about some of the appointees to the Obama administration. The questioner was referring obliquely to conservative dismay at Van Jones, special adviser for green jobs on the White House environmental council. Apart from a flirtation with radicalism (you have to hope it did not become a full, deep and continuing relationship), Jones, in February, thoughtfully attempted to capture the essence of the GOP in a speech in Berkeley, Calif. "Republicans are —," he explained. We don't print the word he used, but it refers to a body part involved in elimination. He was speaking at the inaugural ceremony of the Rahm Emanuel Center for the Study of Political Comportment. Ha, just kidding.

But Mr. Jones is not my concern. All early administrations draw to their middle and lower levels a certain number of activists from the edges—flakes. But because they are extreme, they become controversial, and because they are controversial, they become ineffective. In its way the system works.

A greater concern about President Obama's staffers and appointees is that so many of them are so young and relatively untried. And not only young and untried, but triumphant. They're on top of the world. They came from nowhere and elected their guy against the odds. Against expectations, they beat a machine (the Clintons) and a behemoth (long-triumphant Republicanism). Now nothing can stop them, Let's do big things, let's be consequential. Consequentialism has been the blight of America's political life for a decade. Because of it, America's nerves have been rubbed raw.

To make things worse, for the past 10 months Mr. Obama's aides have been overpraised by their friends in the media, who either are on their side or were source-greasing. How can you not return my calls when I called you "coruscatingly brilliant" in Time?

I use "coruscatingly brilliant" because it was what a columnist early on called Arthur Schlesinger Jr., a figure in John F. Kennedy's White House and the focus of much, and deserved, praise. JFK saw it and laughed: "Just remember, a hundred thousand votes the other way and we'd all be coruscatingly stupid." JFK was of course young himself, but he'd fought a war and been sick since childhood, which will tend to age you.

Why be concerned about the young in the White House? Because they've never been beaten up by life, never been defeated. They haven't learned from failure because they haven't experienced it. They don't know what the warning signs of trouble are. They haven't spent time on the losing side.

Mr. Obama's young aides are hardworking, humorous and bright as pennies, but I wish they had an arthritic ache or two, I wish they told old war stories because they'd been in old wars, I wish they knew what it looks like when an administration goes too far and strains the ties between itself and the bulk of the people.
***

They are all now busy planning and strategizing his congressional address on health care. It will be hard to pull off well. The president will be talking, essentially, to three groups: the political elites of both parties and the media, his supporters on the ground, and highly informed citizens who are already either for or against the plan but want to hear, ponder and form an opinion on the speech.

But the great mass of Americans, the big center, will, I strongly suspect, not be listening. Mr. Obama has grown boring. And it's not Solid Boring, which is fine in a president and may be good. It's sort of Faux Eloquent Boring, especially on health care. The president likely doesn't know this, and his people won't have told him because they don't know it either, but Mr. Obama always has the same sound, approach, logic, tone, modulation. He always has the same stance. There's no humor or humility in it. News is surprise, and he never makes news.

The past 10 months, the president has lessened and not increased the trust of the big center. He did a number of things wrong, but one has not been noticed much, or noted. He moved too quickly, before he'd earned the right to change a big chunk of American life. You earn that right by establishing trust. Absent crisis, leaders have to show, over a certain amount of time and through a series of actions, that they're sober, sound, farsighted, looking out for the middle. In addition, of course, middle America is worried about two dramas, the economy and war, and he's showing he's worried about a third drama, health care, which they've put to the side. His concerns do not coincide with theirs. Which makes him, not them, look out of touch.
More Peggy Noonan

He could always surprise everyone by saying he made a mistake and he's going back to the drawing board to work hand in hand with Republicans. That would be interesting, and could be quite productive. But no one expects a climbdown at this point. And so he will go on, and win something, some piece of what he wants, and "Obama Wins Health Care Battle" will wind up in the headlines, and it will be a catastrophic victory, won at the price of losing the big center.

***

The president's biggest potential long-term problem in terms of the public part of the presidency became obvious to me only during the past week.

I watched with great interest much of Teddy Kennedy's wake and funeral, and saw in a clearer way than I had in the past a big cultural difference between the elites of the two parties, or rather the Democratic and Republican establishments. Pretty much the entire Democratic establishment was at the Kennedy services, and the level of shown affection among those in the pews and the audience was striking—laughing, hugging, telling stories, admitting weaknesses, weeping. It was Irish, and old-time. If it had been a gathering of the Republican political and journalistic establishment it would have been less emotive, with little shown affection. Polite laughter, cordial handshakes, a lot of staring ahead. A guy with his head down and you think he's mourning but he's BlackBerrying. They don't especially like each other, they compete against each other, and they don't feel the need to fake liking each other. They have the old dignity of the old grown-ups. And I suppose their style reflects some of their philosophy: Politics isn't about emotions but thoughts.

The difference between the party establishments struck me, but is not my point. This is: The president walked into the funeral and moved toward the front pews nodding, shaking hands. He hugged Mrs. Kennedy, nodded some more, shook more hands. He was dignified and contained, he was utterly appropriate, and he was cold.

He is cold, like someone who is contained not because he's disciplined and successfully restrains his emotions, but because there's not that much to restrain. This is the dark side of cool. One wonders if this will play well with the American people. Long-term it is hard to get people to trust your policies if they think you're coolly operating on some intellectual or ideological abstractions.

I don't think as a presidential style it will wear well with the center. And it may not wear well with the president's own party. They may come to see him, in time, as not really one of them. And that's when things will really get interesting.

Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit

www.djreprints.com

JOE'S CRITIQUE MAY TURN TIDE

By DICK MORRIS & EILEEN MCGANN
August 26, 2009 --

SEN. Joseph Lieberman's criticism of the Obama health-care initiative may prove to be a pivotal turning point.

Others have focused exclusively on the Obama plan's impact on health care. The elderly worry about bearing the brunt of the inevitable rationing; others look with alarm at the de facto socialization of one-sixth of our economy.

But Lieberman's critique doesn't center on the program's health-care aspects or even on its ultimate desirability. Rather, he questions the wisdom of attempting so radical a transformation and so extensive -- and expensive -- an extention of government's role in our economy during a major recession attended by a huge budget deficit.

His go-slow commentary integrates worries about the economy, the deficit and interest rates with those about the health-care proposal itself. In making this linkage, Lieberman cautions supporters of the idea and of the plan that this might not be the right time to try to do it all.

His comments come at a time when the Congressional Budget Office predicts a growth in the 10-year deficit projection to $9 trillion and when Americans are growing increasingly nervous about the massive debt we are incurring.

Few buy the president's argument that spending $1 trillion extra will cut the deficit and rein in spending. The very notion is so counter-intuitive that it is hard to give it any credibility.

The elderly may worry about the reform bill's cuts of $500 billion in Medicare and Medicaid over the ensuing decade; conservatives may fret over socialization of health care. But the average American can relate most easily to the concerns over the size of the debt and the deficit that Lieberman articulates.

This also gives moderates a place to go in the health-care debate. Caught in the tug between the liberals who dominate Democratic primaries and the more conservative voices that may prevail in November, centrist Democrats can rally easily around Joe Lieberman's "not now" approach.

It is obvious that, despite the Obama majorities in Congress, this is the exact wrong time to embark on a major new government spending program.

By expressing the obvious -- that this is a time for retrenchment, not for expansion of the public sector -- Lieberman may even have given President Obama an avenue of escape, permitting him to accept a scaled-back, phased-in program that might attract bipartisan support.

Pull the Plug on ObamaCare: It's the best cure for what ails the Obama presidency.

By PEGGY NOONAN
AUGUST 21, 2009, 3:58 P.M. ET

Looking back, this must have been the White House health-care strategy:

Health care as a subject is extraordinarily sticky, messy and confusing. It's inherently complicated, and it's personal. There are land mines all over the place. Don't make the mistake the Clintons made and create a plan that gets picked apart, shot down, and injures the standing of the president. Instead, push it off on Congress. Let them come up with a dozen plans. It will keep them busy. It will convince them yet again of their importance and autonomy. It will allow them to vent, and perhaps even exhaust, their animal spirits. Various items and elements within each bill will get picked off by the public. Fine, that's to be expected. The bills may in fact yield a target-rich environment. Fine again. Maybe health care's foes will get lost in the din and run out of ammo. Maybe they'll exhaust their animal spirits, too.

Summer will pass, the fight confined to the public versus Congress. And at the end, in the fall, the beauty part: The president swoops in and saves the day, forcing together an ultimate and more moderate plan that doesn't contain the more controversial elements but does constitute a successful first step toward universal health care.

That's not what happened.

It all got hotter, quicker than the White House expected. The many plans of Congress congealed in the public mind into one plan, and the one plan became a poison pool. The president is now immersed in it.

***

Here's another thing that didn't work. (I write as if health-care reform or insurance reform or whatever it's called this week is already a loss, a historic botch, because it is. Even if the White House wins, they lose, because the cost in terms of public trust and faith was too high.)

Every big idea that works is marked by simplicity, by clarity. You can understand it when you hear it, and you can explain it to people. Social Security: Retired workers receive a public pension to help them through old age. Medicare: People over 65 can receive taxpayer-funded health care. Welfare: If you have no money and cannot support yourself, we will help as you get back on your feet.

These things are clear. I understand them. You understand them. The president's health-care plan is not clear, and I mean that not only in the sense of "he hasn't told us his plan." I mean it in terms of the voodoo phrases, this gobbledygook, this secret language of government that no one understands—"single payer," "public option," "insurance marketplace exchange." No one understands what this stuff means, nobody normal.

And when normal people don't know what the words mean, they don't say to themselves, "I may not understand, but my trusty government surely does, and will treat me and mine with respect." They think, "I can't get what these people are talking about. They must be trying to get one past me. So I'll vote no."

***
In a more beautiful world, the whole health-care chapter could become, for the president, that helpful thing, the teachable moment. The president the past month has been taught a lot by the American people. It's all there in the polls. He could still step back, rethink, say it didn't work, promise to return with something better.

When presidents make clear, with modesty and even some chagrin, that they have made a mistake but that they've learned a lesson and won't be making it again, the American people tend to respond with sympathy. It is our tradition and our impulse.

Such admissions are not a sign of weakness. John F. Kennedy knew this after the Bay of Pigs. He didn't blame his Republican predecessor, Dwight Eisenhower, or the agencies that had begun the invasion's tentative planning under Ike. JFK made it clear he'd learned a great deal, which increased confidence in his leadership. His personal popularity rose so high that he later wryly noted that the more mistakes he made, the more popular he became.

I suspect the American people would appreciate seeing Barack Obama learn from this, and keep going. He's their president. He will be for the next few difficult years, which will no doubt contain moments he will have to lead us through. They also probably wouldn't mind seeing a wry, modest, very human and self-critical stance from a new president who doesn't strut and doesn't swagger but does have a level of 1950s cool, Old Vegas cool, of supreme and confident smoothness that one wouldn't mind seeing ruffled a bit by that old ruffler, reality. Critics of George W. Bush will say here, "Did he ever show wry self-criticism?" No, he didn't. And that's why it ended so well for him.

Modern presidents are always afraid to show anything so human as modesty or doubt. They're afraid of the endless cable-news loop of "I think I was wrong, I think I misjudged, I didn't get it right." They're afraid of death by soundbite. Which is understandable. But they should get over it, especially when it comes to a bit of self-criticism, and even a bit of self-doubt. Modesty is one of the prevailing moods of the moment, it's part of where the American people are and have been since at least a year ago when the economy tanked. We all lived through the abundance, made investments, not only financial ones, that turned out good or bad, made mistakes of judgment, and are wondering about the past decade, and its mistakes, and our part in its mistakes.

It shouldn't become a wallow, but there's nothing wrong with self-reflection and trying to learn from everything we did that was wrong, and right. It wouldn't be so bad to see a president echo this.

***

A final factor contributed to the mess of the health-care debate, and the White House might ponder it. Looking back, what a lucky man President Clinton was to have—to help bring about after his own health-care fiasco—a Congress controlled by the opposite party. What a great and historic team Mr. Clinton and Newt Gingrich were, a popular Democratic president and a determined GOP leader with a solid majority. Welfare reform, a balanced budget, and a sense the public could have that not much crazy would happen and some serious progress might be made. If Mr. Clinton pressed too hard, Mr. Gingrich would push back. If Mr. Gingrich pressed too hard Mr. Clinton pushed back. Two gifted, often perplexing and always controversial Boomers who didn't even like each other, and yet you look back now and realize: Good things happened there.

Right now Mr. Obama's gift is his curse, a Congress dominated by his party. While the country worries about the economy and two wars, the Democrats of Congress are preoccupied with the idea that this is their moment, now is their time, health care now, "Never let a good crisis go to waste," the only blazingly memorable phrase to be uttered in the new era.

It's not especially pleasurable to see history held hostage to ideological vanity, but it's not the first time. And if they keep it up, they'll help solve the president's problem. He'll have a Republican congress soon enough.

Op-Ed Columnist
This Is Reform?
NYTIMES
By BOB HERBERT
August 18, 2009

It’s never a contest when the interests of big business are pitted against the public interest. So if we manage to get health care “reform” this time around it will be the kind of reform that benefits the very people who have given us a failed system, and thus made reform so necessary.

Forget about a crackdown on price-gouging drug companies and predatory insurance firms. That’s not happening. With the public pretty well confused about what is going on, we’re headed — at best — toward changes that will result in a lot more people getting covered, but that will not control exploding health care costs and will leave industry leaders feeling like they’ve hit the jackpot.

The hope of a government-run insurance option is all but gone. So there will be no effective alternative for consumers in the market for health coverage, which means no competitive pressure for private insurers to rein in premiums and other charges. (Forget about the nonprofit cooperatives. That’s like sending peewee footballers up against the Super Bowl champs.)

Insurance companies are delighted with the way “reform” is unfolding. Think of it: The government is planning to require most uninsured Americans to buy health coverage. Millions of young and healthy individuals will be herded into the industry’s welcoming arms. This is the population the insurers drool over.

This additional business — a gold mine — will more than offset the cost of important new regulations that, among other things, will prevent insurers from denying coverage to applicants with pre-existing conditions or imposing lifetime limits on benefits. Poor people will either be funneled into Medicaid, which will have its eligibility ceiling raised, or will receive a government subsidy to help with the purchase of private insurance.

If the oldest and sickest are on Medicare, and the poorest are on Medicaid, and the young and the healthy are required to purchase private insurance without the option of a competing government-run plan — well, that’s reform the insurance companies can believe in.

And then there are the drug companies. A couple of months ago the Obama administration made a secret and extremely troubling deal with the drug industry’s lobbying arm, the Pharmaceutical Research and Manufacturers of America. The lobby agreed to contribute $80 billion in savings over 10 years and to sponsor a multimillion-dollar ad campaign in support of health care reform.

The White House, for its part, agreed not to seek additional savings from the drug companies over those 10 years. This resulted in big grins and high fives at the drug lobby. The White House was rolled. The deal meant that the government’s ability to use its enormous purchasing power to negotiate lower drug prices was off the table.

The $80 billion in savings (in the form of discounts) would apply only to a certain category of Medicare recipients — those who fall into a gap in their drug coverage known as the doughnut hole — and only to brand-name drugs. (Drug industry lobbyists probably chuckled, knowing that some patients would switch from generic drugs to the more expensive brand names in order to get the industry-sponsored discounts.)

To get a sense of how sweet a deal this is for the drug industry, compare its offer of $8 billion in savings a year over 10 years with its annual profits of $300 billion a year. Robert Reich, who served as labor secretary in the Clinton administration, wrote that the deal struck by the Obama White House was very similar to the “deal George W. Bush struck in getting the Medicare drug benefit, and it’s proven a bonanza for the drug industry.”

The bonanza to come would be even larger, he said, “given all the Boomers who will be enrolling in Medicare over the next decade.”

While it is undoubtedly important to bring as many people as possible under the umbrella of health coverage, the way it is being done now does not address what President Obama and so many other advocates have said is a crucial component of reform — bringing the ever-spiraling costs of health care under control. Those costs, we’re told, are hamstringing the U.S. economy, making us less competitive globally and driving up the budget deficit.

Giving consumers the choice of an efficient, nonprofit, government-run insurance plan would have moved us toward real cost control, but that option has gone a-glimmering. The public deserves better. The drug companies, the insurance industry and the rest of the corporate high-rollers have their tentacles all over this so-called reform effort, squeezing it for all it’s worth.

Meanwhile, the public — struggling with the worst economic downturn since the 1930s — is looking on with great anxiety and confusion. If the drug companies and the insurance industry are smiling, it can only mean that the public interest is being left behind.

Worst. Hires Rate. Ever. Welcome to the “Help Not Wanted” economy.
National Review
By Jerry Bowyer
August 14, 2009

It’s not enough for most people to know what the unemployment rate is and whether it’s going up or down. It’s not enough for investors and entrepreneurs living during some of the strangest times in American financial history. And it’s not enough for citizens trying to decide whether the policy proposals now in Washington are worthy of their support. If you fall into any of these categories, you need to know more about the labor market than the headline numbers. In particular, you need to know the JOLT.

Last week we learned that non-farm payrolls dropped by “only” 247,000 and that the unemployment rate decreased a tick from 9.5 percent to 9.4 percent — important statistics both. This week, however, a lesser-known but no-less-vital jobs indicator arrived: the Job Openings and Labor Turnover Survey (or JOLT, to its friends). This survey breaks down the ins and outs, literally, of our dynamic employment system. It tells us how fast we’re hiring, firing, quitting, and offering gainful employment. Critically, it tells us the hires rate.

The Bureau of Labor Statistics defines the hires rate as the “number of hires during the month divided by the number of employees who worked during or received pay for the pay period that includes the 12th of the month.” And the latest hires rate — the worst in the history of this measure — confirms what BuzzCharts has been reporting for months (see “Obama’s Magical Misery Tour” and “The Jobless Recovery”): Entrepreneurs and business managers are frozen. They’ve stopped posting want ads and they’ve stopped adding staff. When I look at the chart above, I see a giant sign hanging in the window of America. It reads: “Help Not Wanted.”

Economic minds on the political left might reflexively counter that the blame should fall on the greedy businesspeople who are not hiring. But even if we concede that business owners are greedy (which we do not), was there ever a point, across the hundreds of months during which the hiring rate has been reported, when they weren’t greedy? Weren’t they greedy when they went on a hiring spree following passage of the Bush-Cheney (or is it the other way around?) tax cuts of 2003? Did Obama make them greedy?

No, but Obama has made them scared. Everywhere I go I hear the same story. Business owners know the little details that academics and pundits don’t, and they know what not to do. They know, for example, that payroll taxes are not only scheduled to rise, but already have risen. And they know all too well that government-mandated unemployment compensation is funded by employers through an unemployment-compensation payroll tax. As a result, they know not to hire.

As a business owner, your unemployment-compensation level rises as you are forced to cut your workforce. And when job-market conditions are strained, as they are now, each new employee you hire becomes a potentially larger cost center than he used to be for each hour worked. If you let him go, you will end up paying him anyway every time you cut a check to your remaining employees. My friend Art Laffer calls this a “wedge” between employee and employer. It’s a job killer and a wealth killer.

BuzzCharts offers its sincerest prayers and condolences to the roughly 15 million Americans — including one in four teenagers and one in three African-American teenagers — who want work but can’t find it. We’ve been there too.

But if the job statistics don’t miraculously recover, you’ll need to proceed as follows: Next year, get out there and elect for yourself, and the rest of us, a new Congress. One that understands the way the world really works.

Two years after that, vote in a new president.

Op-Ed Columnist
Is Obama Punking Us?
NYTIMES
By FRANK RICH
August 9, 2009

“AUGUST is a challenging time to be president,” said Andrew Card, the former Bush White House chief of staff, as he offered unsolicited advice to his successors in a television interview last week. “I think you have to expect the unexpected.”

He should know. Thursday was the eighth anniversary of “Bin Laden Determined to Strike in U.S.,” the President’s Daily Brief that his boss ignored while on vacation in Crawford. Aug. 29 marks the fourth anniversary of Hurricane Katrina’s strike on the Louisiana coast, which his boss also ignored while on vacation in Crawford.

So do have a blast in Martha’s Vineyard, President Obama.

Even as we wait for some unexpected disaster to strike, Beltway omens for the current White House are grim. Obama’s poll numbers are approaching free fall, we are told. If he fails on health care, he’s toast. Indeed, many of the bloviators who spot a fatal swoon in the Obama presidency are the same doomsayers who in August 2008 were predicting his Election Day defeat because he couldn’t “close the deal” and clear the 50 percent mark in matchups with John McCain.

Here are two not very daring predictions: Obama will get some kind of health care reform done come fall. His poll numbers will not crater any time soon.

Yet there is real reason for longer-term worry in the form of a persistent, anecdotal drift toward disillusionment among some of the president’s supporters. And not merely those on the left. This concern was perhaps best articulated by an Obama voter, a real estate agent in Virginia, featured on the front page of The Washington Post last week. “Nothing’s changed for the common guy,” she said. “I feel like I’ve been punked.” She cited in particular the billions of dollars in bailouts given to banks that still “act like they’re broke.”

But this mood isn’t just about the banks, Public Enemy No. 1. What the Great Recession has crystallized is a larger syndrome that Obama tapped into during the campaign. It’s the sinking sensation that the American game is rigged — that, as the president typically put it a month after his inauguration, the system is in hock to “the interests of powerful lobbyists or the wealthiest few” who have “run Washington far too long.” He promised to smite them.

No president can do that alone, let alone in six months. To make Obama’s goal more quixotic, the ailment that he diagnosed is far bigger than Washington and often beyond politics’ domain. What disturbs Americans of all ideological persuasions is the fear that almost everything, not just government, is fixed or manipulated by some powerful hidden hand, from commercial transactions as trivial as the sales of prime concert tickets to cultural forces as pervasive as the news media.

It’s a cynicism confirmed almost daily by events. Last week Brian Stelter of The Times reported that the corporate bosses of MSNBC and Fox News, Jeffrey Immelt of General Electric and Rupert Murdoch of News Corporation, had sanctioned their lieutenants to broker what a G.E. spokesman called a new “level of civility” between their brawling cable stars, Keith Olbermann and Bill O’Reilly. A Fox spokesman later confirmed to Howard Kurtz of The Post that “there was an agreement” at least at the corporate level. Olbermann said he was a “party to no deal,” and in any event what looked like a temporary truce ended after The Times article was published. But the whole scrape only fed legitimate suspicions on the right and left alike that even their loudest public voices can be silenced if the business interests of the real American elite decree it.

You might wonder whether networks could some day cut out the middlemen — anchors — and just put covert lobbyists and publicists on the air to deliver the news. Actually, that has already happened. The most notorious example was the flock of retired military officers who served as television “news analysts” during the Iraq war while clandestinely lobbying for defense contractors eager to sell their costly wares to the Pentagon.

The revelation of that scandal did not end the practice. Last week MSNBC had to apologize for deploying the former Newsweek writer Richard Wolffe as a substitute host for Olbermann without mentioning his new career as a corporate flack. Wolffe might still be anchoring on MSNBC if the blogger Glenn Greenwald hadn’t called attention to his day job. MSNBC assured its viewers that there were no conflicts of interest, but we must take that on faith, since we still don’t know which clients Wolffe represents as a senior strategist for his firm, Public Strategies, whose chief executive is the former Bush White House spin artist, Dan Bartlett.

Let’s presume that Wolffe’s clients do not include the corporate interests with billions at stake in MSNBC and Washington’s Topic A, the health care debate. If so, he’s about the only player in the political-corporate culture who’s not riding that gravy train.

As Democrats have pointed out, the angry hecklers disrupting town-hall meetings convened by members of Congress are not always ordinary citizens engaging in spontaneous grass-roots protests or even G.O.P. operatives, but proxies for corporate lobbyists. One group facilitating the screamers is FreedomWorks, which is run by the former Congressman Dick Armey, now a lobbyist at the DLA Piper law firm. Medicines Company, a global pharmaceutical business, has paid DLA Piper more than $6 million in lobbying fees in the five years Armey has worked there.

But the Democratic members of Congress those hecklers assailed can hardly claim the moral high ground. Their ties to health care interests are merely more discreet and insidious. As Congressional Quarterly reported last week, industry groups contributed almost $1.8 million in the first six months of 2009 alone to the 18 House members of both parties supervising health care reform, Nancy Pelosi and Steny Hoyer among them.

Then there are the 52 conservative Blue Dog Democrats, who have balked at the public option for health insurance. Their cash intake from insurers and drug companies outpaces their Democratic peers by an average of 25 percent, according to The Post. And let’s not forget the Democratic Senate Campaign Committee, which has raked in nearly $500,000 from a single doctor-owned hospital in McAllen, Tex. — the very one that Obama has cited as a symbol of runaway medical costs ever since it was profiled in The New Yorker this spring.

In this maze of powerful moneyed interests, it’s not clear who any American in either party should or could root for. The bipartisan nature of the beast can be encapsulated by the remarkable progress of Billy Tauzin, the former Louisiana congressman. Tauzin was a founding member of the Blue Dog Democrats in 1994. A year later, he bolted to the Republicans. Now he is chief of PhRMA, the biggest pharmaceutical trade group. In the 2008 campaign, Obama ran a television ad pillorying Tauzin for his role in preventing Medicare from negotiating for lower drug prices. Last week The Los Angeles Times reported — and The New York Times confirmed — that Tauzin, an active player in White House health care negotiations, had secured a behind-closed-doors flip-flop, enlisting the administration to push for continued protection of drug prices. Now we know why the president has ducked his campaign pledge to broadcast such negotiations on C-Span.

The making of legislative sausage is never pretty. The White House has to give to get. But the cynicism being whipped up among voters is justified. Unlike Hillary Clinton, whose chief presidential campaign strategist unapologetically did double duty as a high-powered corporate flack, Obama promised change we could actually believe in.

His first questionable post-victory step was to assemble an old boys’ club of Robert Rubin protégés and Goldman-Citi alumni as the White House economic team, including a Treasury secretary, Timothy Geithner, who failed in his watchdog role at the New York Fed as Wall Street’s latest bubble first inflated and then burst. The questions about Geithner’s role in adjudicating the subsequent bailouts aren’t going away, and neither is the angry public sense that the fix is still in. We just learned that nine of those bailed-out banks — which in total received $175 billion of taxpayers’ money, but as yet have repaid only $50 billion — are awarding a total of $32.6 billion in bonuses for 2009.

It’s in this context that Obama can’t afford a defeat on health care. A bill will pass in a Democrat-controlled Congress. What matters is what’s in it. The final result will be a CAT scan of those powerful Washington interests he campaigned against, revealing which have been removed from the body politic (or at least reduced) and which continue to metastasize. The Wall Street regulatory reform package Obama pushes through, or doesn’t, may render even more of a verdict on his success in changing the system he sought the White House to reform.

The best political news for the president remains the Republicans. It’s a measure of how out of touch G.O.P. leaders like Mitch McConnell and John Boehner are that they keep trying to scare voters by calling Obama a socialist. They have it backward. The larger fear is that Obama might be just another corporatist, punking voters much as the Republicans do when they claim to be all for the common guy. If anything, the most unexpected — and challenging — event that could rock the White House this August would be if the opposition actually woke up.

The Great American Debt
We are committing national suicide by debt addiction, as the Chinese rake in our IOUs.
National Review
By Victor Davis Hanson
August 05, 2009, 4:00 a.m.

With our national debt at $11 trillion and climbing at a projected rate of $1 to $2 trillion a year, examine the brilliant manner in which Americans justify borrowing much of this money from abroad, particularly from the Chinese.

Precise figures on how much the United States owes China are hard to come by. China is secretive about where it invests its vast surpluses, and even about how gargantuan they have become. Perhaps they are afraid that if such data become widely known, Chinese reformers will start questioning state financial policy — and specifically how, why, and where such national wealth is banked.

But for now, many observers believe the figure may have reached $1.4 trillion. On a per-capita basis, this means that each affluent American has borrowed well over $4,000 from the rather poor Chinese. We have excused our indebtedness in a variety of insidious ways. We say that our annual deficits and aggregate debt stimulate the U.S. consumer demand that is so essential to the Chinese export market. By buying and borrowing from China, we have jumpstarted its transformation from rogue nation to member of the responsible capitalist world — with benefits for the planet at large.

We go on to say that cheap Chinese goods keep consumer costs down in the U.S., increase the purchasing power of a weak currency, and maintain constant pressure on American competitors to maximize efficiency, lower prices, and cut costs. If real earnings have remained stagnant for the middle class, their purchasing power has increased, thanks in part to reduced prices at Wal-Mart and other mass retailers of Chinese goods.

And we’ve thought up even more justifications. Some argue that this debtor/creditor relationship is analogous to the federal government’s tangled no-divorce involvement with AIG or Citibank: The U.S. is simply “too big to fail,” and so we have more leverage over the Chinese than they have over us. They stop lending, we stop buying — and soon their factories shut down. And by the way, we pay low interest at fixed rates on their billions, and plan to pay them back with inflated dollars that will translate in the end into negative-interest loans.

Others point out that China has few options as to where to park its surpluses. Even in the era of Bernie Madoff and Lehman Brothers, what other country is so transparent and committed to protecting capital from arbitrary confiscation or government manipulation? And if China were to tap its vast cash reserves and begin a domestic shopping spree, it might create a consumer revolution at home, in which ever-increasing expectations would fuel ever-rising discretionary spending. If one billion Chinese started investing in three-bedroom homes, SUVs, and power boats, would the Chinese environment support it? Would China’s labor remain competitive? Could the government still control public discourse and expression?

Besides the strange ways in which we addicts justify our borrowing habit vis-à-vis China, such huge sums have also warped politics at home. Republicans have not balanced a budget since the latter days of the Eisenhower presidency. We are supposed to nod and smile when they talk about financial responsibility, like the crowds at the naked emperor’s procession. Nixon, Reagan, and the two Bushes all employed varying exegeses to justify red ink — Keynes, supply side, tapering deficits, a balanced budget by 2010, etc. Clinton, in contrast, was the last president to actually balance a budget — thanks mostly to a Republican Congress.

The recent Republican-Democratic symbiosis about borrowing is bizarre: Democrats in Congress run up debts like teenagers, enabled by the fact that their Republican parents in the White House never call in their credit cards. Republicans, in turn, started calibrating debts and deficits as percentages of GDP, not in real dollars, once hundreds of billions had metamorphosed into tens of trillions.

Liberals privately talked about “gorging the beast,” hoping that their out-of-control spending would force higher taxes, and with them a long-awaited redistribution of income and government-mandated equality of result. Conservatives have talked of “starving the beast,” by voting in tax cuts that would dry up government revenues and therefore force an end to huge federal expenditures. In the end, we got only higher taxes and higher spending and higher deficits and more debt. Republicans now say of Obama’s fantasyland deficits, “He’s gone way beyond Bush.” Democrats reply, “But Bush did it first.”

Both parties privately know that financial physics will take care of the problem in Californian or Icelandic fashion: Lenders abroad and at home will cut off our supply of money; conservatives will have to agree to even more tax increases; liberals will have to agree to some modest spending cuts; and the voters will be told that neither side had any choice. Unless we change our habits, that rendezvous is as inevitable as the sun’s rising. The only mysteries are the approximate date of its arrival, and whether we will call federal pay cuts and layoffs “furloughs,” massive income-tax hikes “surcharges,” and a new blanket federal sales tax an innocuously European-sounding “value-added tax.”

In the meantime, we might begin to look at federal expenditure in terms of where the money is borrowed. Cash-for-clunkers sounds like a great stimulus. But in terms of debt, we are borrowing a few billions from the Japanese and Chinese so that we can rent-to-own new fuel-efficient cars largely from the Japanese and Koreans. At some point, an economist will show us that the savings in fuel efficiency per clunker removed are overmatched by the interest on the money we borrowed for an imported replacement.

I support the conservative argument for a strong next-generation fighter component for national defense. But in acquiring more $177-million F-22 Raptors in our present financial circumstances, we should at least be honest enough to admit that we are renting the planes, not buying them. We are borrowing billions of dollars from the Chinese to protect against future threats from the Chinese. That may sound neat, but at some point the Chinese will not be amused.

When we talk of trillion-dollar health-care initiatives and universal coverage, we fool ourselves again. In essence, we are borrowing hundreds of billions from the Chinese, who do not have adequate health care, in order to give millions of our own citizens what the Chinese lack. Rationed health care is indeed a scary thought, but so is the idea that at age 85, I will have my government Medicare plan borrow $250,000 from the Chinese for my artificial hips and knees while my 50-year-old counterpart from rural China goes without annual check-ups or necessary medications.

Imagine instead an America in which we were obsessed with paying for things rather than borrowing, especially abroad. A senator might pontificate, “I propose purchasing another 100 F-22s, and so advocate cutting the national bike-path program.” Or a congressman would bellow, “I demand universal health care and will force the average rich person to give the government another $25,000 a year to pay for it.” Populists could cry out, “We need interest-free student loans, so I urge that those who make $10 million a year give us another $1 million as a surtax.” Conservatives could counter, “We need a supplemental appropriation for Afghanistan, so we have to cut $200 billion from agricultural subsidies.”

In short order, the entire way we think would be turned upside down, from buying votes with freebies to losing them by demanding payment up front. It all reminds me of the ancient world of my grandfather, who would point to a used tractor he had purchased (and paid for in cash) and sigh, “That cost me 20 tons of raisins”; or would look at the living-room floor and say with a shrug, “It took an acre of Santa Rosa plums to pay for that rug.”

Instead, today we charge it, pay the 19 percent interest on our credit cards, get behind, and then applaud as a Sen. Chris Dodd rails that we were tricked, snookered, and victimized by evil usurers as we justifiably renege on the debt.

It will be interesting when America tries all that with the Chinese.

— Victor Davis Hanson is a senior fellow at the Hoover Institution and a recipient of the 2007 National Humanities Medal. © 2009 Tribune Media Services, Inc.

Teeing Up the Middle Class:
Joe the Plumber’s tax vindication is nigh.
Wall Street Journal
Opinion
August 3, 2009

Few of President Obama’s 2008 campaign pledges were more definitive than his vow that anyone making less than $250,000 a year “will not see their taxes increase by a single dime” if he was elected. And he was right, very strictly speaking: It’s going to be many, many, many billions of dimes.

Asked about raising taxes on the middle class on Sunday on CBS’s “Face the Nation,” White House economist Larry Summers wouldn’t repeat Mr. Obama’s pre-election promise. “It is never a good idea to absolutely rule things out no matter what,” Mr. Summers said—except, apparently, when his boss is running for office. Meanwhile, on ABC’s “This Week,” Treasury Secretary Timothy Geithner also slid around Mr. Obama’s vow and said, “We have to bring these deficits down very dramatically. And that’s going to require some very hard choices.”

These aren’t even nondenial denials. The Obama advisers are laying the groundwork for taxing the middle class while claiming the deficit made them do it.

The liberal establishment is even further along in finally admitting that Mr. Obama wasn’t, er, telling the truth. A piece in the New York Times over the weekend declared in a headline that “the Rich Can’t Pay for Everything, Analysts Say.” And it quoted Leonard Burman, a veteran of the Clinton Treasury who now runs the Brookings Tax Policy Center, as saying that “This idea that everything new that government provides ought to be paid for by the top 5%, that’s a basically unstable way of governing.” They’re right, but where were they during the campaign?

In an editorial on February 26, “The 2% Illusion,” we wrote that the feds could take 100% of the taxable income of everyone in America earning more than $500,000 and still have raised only $1.3 trillion even in the boom year of 2006. The rich are fewer and less rich now, while the Obama budget is nearly $4 trillion.

Democrats already plan to repeal the Bush tax cuts, but that won’t raise enough money. So they’re proposing an income tax surcharge on “the wealthy,” but that won’t raise enough either. Democrats have no choice but to soak the middle class because only they have enough money to finance the liberal dream of yoking the middle class to cradle-to-grave government entitlements.

Democrats have already taxed the middle class by raising cigarette taxes to pay for the children’s health-care expansion. They’re also teeing up average earners with their cap-and-tax energy bill. Mr. Obama had hoped that cap-and-tax would raise some $646 billion over a decade, but Democrats in the House had to give most of that away in bribes to business to pass their bill. To finance ObamaCare, they’re also proposing another 10-percentage-point increase in the payroll tax on firms and individuals that don’t purchase health insurance. But this won’t raise enough money either.

So waiting in the wings is the biggest middle-class tax increase of them all: a European-style value added tax, or VAT. This tax would apply to every level of production or service, and it is beloved by politicians in Europe because it raises so much money so easily without voters noticing. Ezekiel Emanuel, a White House aide and brother of Chief of Staff Rahm Emanuel, has advocated a 10% VAT to finance national health care. Look for a VAT to be one of the prominent options when Mr. Obama’s tax reform commission issues its report later this year.

The undeniable reality is that you can’t run a European-style welfare-entitlement state without European-style levels of taxation on the middle class (and eventually without low European-style growth and high jobless rates). It’s looking more and more like Mr. Obama’s no-middle-class-tax pledge was one of the greatest confidence tricks in American political history.

Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit

RHETORIC V. REALITY: HEALTH CARE BY ORWELL
NEW YORK POST
Dick Morris & Eileen McGann
Last updated: 4:22 am
July 23, 2009
Posted: 2:52 am
July 23, 2009

PRESIDENT Obama's rhetoric last night summoned the memory of "1984," George Orwell's novel of a nightmarish future -- where the slogan of the rulers is "War is peace; freedom is slavery; ignorance is strength."

The president assures us that he will cut health-care spending . . . by adding $1 trillion to health-care spending.

He says that "health-care decisions will not be made by government" . . . while he sets up a new Federal Health Board to tell doctors what treatments they can offer and to whom and under what circumstances.

Obama told the media, "I will free doctors to make good health-care decisions" . . . by telling the physicians what to do.

When the president says he guarantees the "same coverage" to people who like their current health-insurance policies, he means that their current HMOs, insurers and doctors will be the ones to implement the protocols and instructions the government hands down to them -- not that we'll have our current freedom of decision-making.

When he blandly assures us that we will "stop paying for things that don't make us healthier," he really means that his Federal Health Board will overrule your doctor and stop him from using his own best judgment in your treatment.

The president will "get the politics out of health care" by putting it under government control.

Obama says that he will not "add to the deficit" to fund health care. But the bill reported out by Rep. Charlie Rangel's Ways and Means Committee leaves $550 billion unfunded.

The president says that he'll identify savings that will reduce the need for more taxes -- even though the Congressional Budget Office refuses to say that his "savings" will actually work and warns that the bill will really be added to the deficit.

He repeatedly tells us that he'll cut health-care spending. What he means is that he will cut doctors' incomes and will turn down patients -- particularly the elderly -- when they seek medical care that his bureaucrats disapprove of.

And he ignores that cutting incomes in the medical field will reduce the number of doctors and force further rationing of care.

The president opines that he will replace the most "expensive care" with the "best care" by empowering government officials who have never met you to substitute their judgment for that of your doctor, who has examined you thoroughly.

When Obama laments that "14,000 people lose their insurance every day," he is referring to the job losses that his own failed efforts to end the recession have permitted.

He warns that health-care costs are gobbling up money that employers should use to raise wages and worker pay -- yet the plans he backs would require employers to pay 8 percent of their payroll as a tax or provide insurance to their workers.

The Obama plan highlights greater preventive care -- but, at the same time, cuts medical incomes and so will cut the number of doctors who might provide it.

The stimulus package, in the Gospel According to Barack, was "designed" to work over the next two years. But at the time, he demanded immediate passage to "jump-start the economy" -- something that clearly did not happen.

Medicare and Medicaid are "driving the deficit" even as he increased the amount of red ink by at least $800 billion in six months with little, if any, increase in the cost of either program.

He says he "expects" banks to repay their TARP money. In fact, they're lining up around the block to do so -- but the Treasury will only permit a handful of them to do so.

In summary, Obama's health program will promote "lower cost and more choice" by increasing spending by $1 trillion, telling patients what care they're permitted to have, and limiting their access to quality care.

Orwell's heirs should sue for violation of copyright.

Editorial
CIT on the Verge
NYTIMES
July 23, 2009

A funny thing happened last week. After the government refused a second bailout for the CIT Group — the ailing lender to small and midsize businesses — CIT’s bondholders realized how much they could lose if the firm filed for bankruptcy and agreed to provide $3 billion in emergency financing. The agreement, finalized Monday night, averted what would have been the fifth-largest bankruptcy filing in the history of corporate America.

The reprieve is likely only temporary. CIT needs $7 billion just to pay debt that is coming due over the next year. Even if it comes up with the money, the firm’s longer-term viability is still in doubt. That’s because the bondholders currently propping up CIT are apparently counting on regulators to provide more government support in the future. That’s far from assured.

The government’s decision not to offer a second bailout to CIT is defensible. The lender had not satisfactorily restructured its operations since receiving a $2.3 billion bailout late last year. Since then, financial markets have calmed down, building confidence among regulators that the system is strong enough to withstand at least CIT-sized problems.

While CIT may be too small to rescue, its problems hold big lessons for the Obama administration on how to manage through the ongoing recession and how to judge the system that is emerging from the wreckage.

For starters, forcing CIT to fend for itself does not mean that its business customers should be cut adrift. In today’s tight credit markets, many small businesses cannot simply switch lenders at will. In a CIT bankruptcy filing, retailers could be especially clobbered, since the firm provides short-term financing to some 2,000 vendors that supply hundreds of thousands of stores. And yet, last week, when the government refused to rescue CIT, it had no apparent plan to make sure those businesses would continue to have access to the financing needed to stay in business.

Clearly, the administration must do more to ensure that lender difficulties do not undermine small businesses. The Treasury Department must ramp up a stalled $15 billion initiative to buy up small business loans so that lenders have more money to re-lend. The program was announced in March but is not expected to be up and running until the end of this month. A separate $730 million program that allows the Small Business Administration to guarantee most small-business bank loans should be reassessed to see if it is big enough.

The Obama administration must also pay close attention to how the broader financial system responds to CIT’s difficulties. As CIT restructures, whole swaths of its operations could be sold to competitors. The knee-jerk reaction would be to hail that outcome as evidence that the markets are working to efficiently deploy resources.

But if much or most of the business ends up at the few big banks that are still standing (thanks in no small part to federal efforts to rescue the financial system), the result would be that too-big-to-fail institutions get even bigger. That implies, in turn diminished competition, higher banking costs for businesses and increased systemwide risk. That would be the opposite of what’s needed to rebuild a healthy economy.

BRACE YOURSELVES FOR HIGHER TAXES
New York Post
George Will
Last updated: 1:49 am
July 13, 2009
Posted: 1:18 am
July 13, 2009

ECONOMIC policy, which became startling when Washington began buying automobile companies, has become surreal now that disappointment with the results of the second stimulus is stirring talk about the need for a . . . second stimulus.

Elsewhere, it requires centuries to bleach mankind's memory; in Washington, 17 months suffice: In February 2008, President George W. Bush and Speaker Nancy Pelosi agreed that a $168 billion stimulus -- Stimulus I -- would be the "booster shot" the economy needed. Unemployment then was 4.8 percent.

In January, the administration said that unless another stimulus -- Stimulus II wound up involving $787 billion -- was passed immediately, unemployment, which then was 7.6 percent, would reach 9 percent by 2010. But halfway through 2009, the rate is 9.5. For the first time since the now 16-nation Eurozone was established in 1999, the unemployment rate in America is as high as it is in that region, which Americans once considered a cautionary lesson in the wages of sin, understood as excessive taxation and regulation.

"Everyone guessed wrong" about the economy's weakness, says the vice president, explaining why Stimulus II hasn't yielded anticipated benefits.

To be fair, economics is a science of single instances, which means it is hardly a science. And it is least like one when we most crave certainty from it -- when there is a huge and unprecedented event and educated guessing is the best anyone can do.

But before embarking on Stimulus III, note that only about 10 percent of Stimulus II has yet been injected into the economy in 2009. This is not the administration's fault, the administration's defenders say, because government is cumbersome, sluggish and inefficient.

But this sunburst of insight comes as the administration toils to enlarge governmental control of health care, energy, finance, education, etc. The administration guesses that these government projects will do better than the Postal Service (its second-quarter loss, $1.9 billion, was 68 percent of its losses for all of 2008) and the government's railroad. (Amtrak has had 38 money-losing years.)

Let's guess: Will a person or institution looking for a place to invest $1 billion seek opportunities in America, where policy decisions are deliberately raising taxes, debt, regulations and the cost of energy, and soon will increase the cost of borrowing and hiring?

Or will the investor look at, say, India. It's the least urbanized major country (70 percent of Indians live in rural areas) so the modernizing and productivity-enhancing movement from the countryside to the city is in its infancy. This nation of 1.2 billion people has a savings rate of 25 percent to 30 percent, and fewer than 20 million credit cards. Which nation, India or America, is apt to have the higher economic growth in the next decade?

Yet while government diminishes America's comparative advantages, liberals are clamoring for . . . higher taxes. Partly because of changes endorsed by presidents from Ronald Reagan to Barack Obama, some 60 percent of taxpayers now pay either no income tax (43 percent) or less than 5 percent of their income. Because one can't raise significant money by that tax without nicking the middle class, or without bringing millions of people back onto the income tax rolls, attention is turning to a value-added tax.

A VAT is levied at every stage of production. Like cap-and-trade, a VAT is a liberal politician's delight: It taxes everything, but opaquely.

Before he became an economic adviser in the Obama White House, where wit can be dangerous, Larry Summers said: Liberals oppose a VAT because it is regressive and conservatives oppose it because it is a money machine, but a VAT might come when liberals realize it is a money machine and conservatives realize it is regressive.

At the June 29 White House briefing, Press Secretary Robert Gibbs was asked, with reference to health-care legislation, if the president's pledge not to raise taxes on couples making less than $250,000 is "still active." Gibbs answered: "We are going to let the process work its way through." What's your guess? georgewill@washpost.com

GAG THE INTERNET! AN OBAMA OFFICIAL'S FRIGHTENING BOOK ABOUT CURBING FREE SPEECH ONLINE
NYPOST
Kyle Smith
Last updated: 12:09 pm
July 11, 2009
Posted: 12:05 pm
July 11, 2009

When it comes to the First Amendment, Team Obama believes in Global Chilling.

Cass Sunstein, a Harvard Law professor who has been appointed to a shadowy post that will grant him powers that are merely mind-boggling, explicitly supports using the courts to impose a "chilling effect" on speech that might hurt someone's feelings. He thinks that the bloggers have been rampaging out of control and that new laws need to be written to corral them.

Advance copies of Sunstein's new book, "On Rumors: How Falsehoods Spread, Why We Believe Them, What Can Be Done," have gone out to reviewers ahead of its September publication date, but considering the prominence with which Sunstein is about to be endowed, his worrying views are fair game now. Sunstein is President Obama's choice to head the White House Office of Information and Regulatory Affairs. It's the bland titles that should scare you the most.

"Although obscure," reported the Wall Street Journal, "the post wields outsize power. It oversees regulations throughout the government, from the Environmental Protection Agency to the Occupational Safety and Health Administration. Obama aides have said the job will be crucial as the new administration overhauls financial-services regulations, attempts to pass universal health care and tries to forge a new approach to controlling emissions of greenhouse gases."

Sunstein was appointed, no doubt, off the success of "Nudge," his previous book, which suggests that government ought to gently force people to be better human beings.

Czar is too mild a world for what Sunstein is about to become. How about "regulator in chief"? How about "lawgiver"? He is Obama's Obama.

In "On Rumors," Sunstein reviews how views get cemented in one camp even when people are presented with persuasive evidence to the contrary. He worries that we are headed for a future in which "people's beliefs are a product of social networks working as echo chambers in which false rumors spread like wildfire." That future, though, is already here, according to Sunstein. "We hardly need to imagine a world, however, in which people and institutions are being harmed by the rapid spread of damaging falsehoods via the Internet," he writes. "We live in that world. What might be done to reduce the harm?"

Sunstein questions the current libel standard - which requires proving "actual malice" against those who write about public figures, including celebrities. Mere "negligence" isn't libelous, but Sunstein wonders, "Is it so important to provide breathing space for damaging falsehoods about entertainers?" Celeb rags, get ready to hire more lawyers.

Sunstein also believes that - whether you're a blogger, The New York Times or a Web hosting service - you should be held responsible even for what your commenters say. Currently you're immune under section 230 of the Communications Decency Act. "Reasonable people," he says, "might object that this is not the right rule," though he admits that imposing liability for commenters on service providers would be "a considerable burden."

But who cares about a burden when insults are being bandied about? "A 'chilling effect' on those who would spread destructive falsehoods can be an excellent idea," he says.

"As we have seen," Sunstein writes, having shown us no such thing, "falsehoods can undermine democracy itself." What Sunstein means by that sentence is pretty clear: He doesn't like so-called false rumors about his longtime University of Chicago friend and colleague, Barack Obama.

He alludes on page 3 (and on page 13, and 14, and 45, and 54 - the book is only 87 pages) to the supposedly insidious lie that "Barack Obama pals around with terrorists." Since Sunstein intends to impose his Big Chill on such talk, I'd better get this in while I can. The "rumor," i.e., "fact," about the palsy-walsiness of Obama and unrepentant terrorist Bill Ayers (Ayers referred to Obama as a "family friend" in a memoir) did not "undermine democracy," i.e., prevent Obama's election. The facts got out, voters weighed them and ruled that they weren't disqualifying.

Sunstein calls for a "notice and take down" law that would require bloggers and service providers to "take down falsehoods upon notice," even those made by commenters - but without apparent penalty.

Consider how well this nudge would work. You blog about Obama-Ayers. You get a letter claiming that your facts are wrong so you should remove your post. You refuse. If, after a court proceeding proves simply that you are wrong (but not that you committed libel, which when a public figure is the target is almost impossible), you lose, the penalty is . . . you must take down your post.

How long would it take for a court to sort out the truth? Sasha and Malia will be running for president by then. Nobody will care anymore. But it will give politicians the ability to tie up their online critics in court.

Sunstein, trying to fair, argues that libel awards should be capped at $15,000, or at least limited for anyone demonstrating financial hardship. But $15K is the limit you'd pay to your opponent. The legal bill is the scary part, and the reason bloggers already have plenty of reason to be careful about what they say, even if they don't much fear a libel conviction.

Sunstein dreams of an impossibly virtuous America: "We could also imagine a future in which those who spread false rumors are categorized as such, discounted and marginalized . . . people would approach rumors skeptically even they provide comfort and fit their own biases." But if his chilling wind doesn't work, Sunstein may try to make good on the implicit threat that runs through his book: that he would redefine libel as the spread of false information and hold everyone up the ladder responsible.

If this happened, the blogosphere would turn into Pluto overnight. Comments sections would slam shut. Every writer would work on a leash shorter than a shoelace.

Sunstein is an enemy to every news organization and blogger. We should return the favor and declare war on him.

Obama Can't Be Trusted With Numbers
So why should we trust him with health care?
Wall Street Journal
By KARL ROVE
JULY 9, 2009

In February, President Barack Obama signed a $787 billion stimulus bill while making lavish promises about the results. He pledged that "a new wave of innovation, activity and construction will be unleashed all across America." He also said the stimulus would "save or create up to four million jobs." Vice President Joe Biden said the massive federal spending plan would "drop-kick" the economy out of the recession.

But the unemployment rate today is 9.5% -- nearly 20% higher than the Obama White House said it would be with the stimulus in place. Keith Hennessey, who worked at the Bush White House on economic policy, has noted that unemployment is now higher than the administration said it would be if nothing was done to revive the economy. There are 2.6 million fewer Americans working than Mr. Obama promised.

The economy takes unexpected turns on every president. But what is striking about this president is how quickly he turns away from his promises. He rushed the stimulus through Congress saying we couldn't afford to wait. Now his administration is waiting to spend the money. Of the $279 billion allocated to federal agencies, only $56 billion has been paid out.

Mr. Biden has admitted that the administration "misread" the economy. But he explained that away on ABC's "This Week with George Stephanopoulos" on Sunday by saying the administration had used "the consensus figures and most of the blue chip indexes out there" to draw up its stimulus plan. That's not true.

The Blue Chip consensus is an average of some four dozen economic forecasts. In January, the consensus estimated that GDP for 2009 would shrink by 1.6% and that unemployment would top out at 8.3%. Team Obama assumed both higher GDP growth (it counted on a contraction of 1.2%) and lower peak unemployment (8.1%) than the consensus.

Instead of relying on the Blue Chip consensus, Mr. Obama outsourced writing the stimulus to House appropriators who stuffed it with every bad spending idea they weren't previously able to push through Congress. Little of it aimed to quickly revive the economy. More stimulus money will be spent in fiscal years 2011 through 2019 than will be spent this fiscal year, which ends in September.

On Sunday, Mr. Biden, backpedaling from his drop-kick comments, said that "no one anticipated, no one expected that the recovery package would in fact be in a position at this point of having to distribute the bulk of the money."

This fits a pattern. The administration consistently pledges unrealistic results that it later distances itself from. It has gotten away with it because the media haven't asked many pointed questions. That may not last as the debate shifts to health care.

The Obama administration wants a government takeover of health care. To get it, it is promising to wring massive savings out of the health-care industry. And it has already started to make cost-savings promises.

For example, the administration strong-armed health-care providers into promising $2 trillion in health savings. It got pharmaceutical companies to promise to lower drug prices for seniors by $80 billion over 10 years. The administration also trotted out hospital executives to say that they would voluntarily save the government $150 billion over 10 years.

None of this comes near to being true. On the promised $2 trillion, everyone admits that the number isn't built on anything specific -- it's an aspirational goal. On drug prices, a White House spokesman admitted that "These savings have not been identified at the moment." It is speculative that these cuts will actually be made, when they would begin, or whether they would reduce government health-care spending.

None of this will stop the administration from arguing that its "savings" will pay for Mr. Obama's $1.5 trillion health-care plans. By the time the real price tag emerges, it will be too late to do much more than raise taxes and curtail spending on urgent priorities, such as the military.

The stimulus package is a clear example of how Mr. Obama operates. He is attempting to employ the same tactics of bait-and-switch when it comes to health care, only on a much larger scale.

Mr. Obama has already created a river of red ink. His health-care plans will only force that river over its banks. We are at the cusp of a crucial political debate, and Mr. Obama's words on fiscal matters are untrustworthy. His promised savings are a mirage. His proposals to reshape the economy are alarming. And his unwillingness to be forthright with his numbers reveals that he knows his plans would terrify many Americans.

Mr. Rove is the former senior adviser and deputy chief of staff to President George W. Bush.
Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved

Op-Ed Columnist
Invent, Invent, Invent
NYTIMES
By THOMAS L. FRIEDMAN
June 28, 2009

I was at a conference in St. Petersburg, Russia, a few weeks ago and interviewed Craig Barrett, the former chairman of Intel, about how America should get out of its current economic crisis. His first proposal was this: Any American kid who wants to get a driver’s license has to finish high school. No diploma — no license. Hey, why would we want to put a kid who can barely add, read or write behind the wheel of a car?

Now what does that have to do with pulling us out of the Great Recession? A lot. Historically, recessions have been a time when new companies, like Microsoft, get born, and good companies separate themselves from their competition. It makes sense. When times are tight, people look for new, less expensive ways to do old things. Necessity breeds invention.

Therefore, the country that uses this crisis to make its population smarter and more innovative — and endows its people with more tools and basic research to invent new goods and services — is the one that will not just survive but thrive down the road.

We might be able to stimulate our way back to stability, but we can only invent our way back to prosperity. We need everyone at every level to get smarter.

I still believe that America, with its unrivaled freedoms, venture capital industry, research universities and openness to new immigrants has the best assets to be taking advantage of this moment — to out-innovate our competition. But we should be pressing these advantages to the max right now.

Russia, it seems to me, is clearly wasting this crisis. Oil prices rebounded from $30 to $70 a barrel too quickly, so the pressure for Russia to really reform and diversify its economy is off. The struggle for Russia’s post-Communist economic soul — whether it is going to be more OPEC than O.E.C.D., a country that derives more of its wealth from drilling its mines than from tapping its minds — seems to be over for now.

At the St. Petersburg exposition center, showing off the Russian economy, the two biggest display booths belonged to Gazprom, the state-controlled oil and gas company, and Sberbank, Russia’s largest state-owned bank. Russian companies that actually made things that the world wanted were virtually nonexistent: Two-thirds of Russia’s exports today are oil and gas. Gazprom makes the money, and Sberbank lends it out.

As one Western banker put it, when oil is $35 a barrel, Russia “has no choice” but to reform, to diversify its economy and to put in place the rule of law and incentives that would really stimulate small business. But at $70 a barrel, it takes an act of enormous “political will,” which the petro-old K.G.B. alliance that dominates the Kremlin today is unlikely to summon. Too much rule of law and transparency would constrict the ruling clique’s own freedom of maneuver.

China is also courting trouble. Recently — in the name of censoring pornography — China blocked access to Google and demanded that computers sold in China come supplied with an Internet nanny filter called Green Dam Youth Escort, starting July 1. Green Dam can also be used to block politics, not just Playboy. Once you start censoring the Web, you restrict the ability to imagine and innovate. You are telling young Chinese that if they really want to explore, they need to go abroad.

We should be taking advantage. Now is when we should be stapling a green card to the diploma of any foreign student who earns an advanced degree at any U.S. university, and we should be ending all H-1B visa restrictions on knowledge workers who want to come here. They would invent many more jobs than they would supplant. The world’s best brains are on sale. Let’s buy more!

Barrett argues that we should also use this crisis to: 1) require every state to benchmark their education standards against the best in the world, not the state next door; 2) double the budgets for basic scientific research at the National Science Foundation, the Department of Energy and the National Institute of Standards and Technology; 3) lower the corporate tax rate; 4) revamp Sarbanes-Oxley so that it is easier to start a small business; 5) find a cost-effective way to extend health care to every American.

We need to do all we can now to get more brains connected to more capital to spawn more new companies faster. As Jeff Immelt, the chief of General Electric, put it in a speech on Friday, this moment is “an opportunity to turn financial adversity into national advantage, to launch innovations of lasting value to our country.”

Sometimes, I worry, though, that what oil money is to Russia, our ability to print money is to America. Look at the billions we just printed to bail out two dinosaurs: General Motors and Chrysler.

Lately, there has been way too much talk about minting dollars and too little about minting our next Thomas Edison, Bob Noyce, Steve Jobs, Bill Gates, Vint Cerf, Jerry Yang, Marc Andreessen, Sergey Brin, Bill Joy and Larry Page. Adding to that list is the only stimulus that matters. Otherwise, we’re just Russia with a printing press.

Op-Ed Columnist
The Green Revolution(s)
NYTIMES
By THOMAS L. FRIEDMAN
June 24, 2009

There has been a lot of worthless chatter about what President Barack Obama should say about Iran’s incipient “Green Revolution.” Sorry, but Iranian reformers don’t need our praise. They need the one thing we could do, without firing a shot, that would truly weaken the Iranian theocrats and force them to unshackle their people. What’s that? End our addiction to the oil that funds Iran’s Islamic dictatorship. Launching a real Green Revolution in America would be the best way to support the “Green Revolution” in Iran.

Oil is the magic potion that enables Iran’s turbaned shahs — “Shah Khamenei” and “Shah Ahmadinejad” — to snub their noses at the world and at many of their own people as well. President Mahmoud Ahmadinejad behaves like someone who was born on third base and thinks he hit a triple. By coincidence, he’s been president of Iran during a period of record high oil prices. So, although he presides over an economy that makes nothing the world wants, he can lecture us about how the West is in decline and the Holocaust was a “myth.” Trust me, at $25 a barrel, he won’t be declaring that the Holocaust was a myth anymore.

The Obama team wants to pursue talks with Iran over its nuclear program, no matter who wins there. Fine. But the issue is not talk or no talk. The issue is leverage or no leverage. I love talking to people — especially in the Middle East — on one condition: that we have the leverage. As long as oil prices are high, Iran will have too much leverage and will be able to resist concessions on its nuclear program. With oil at $70 a barrel, our economic sanctions on Iran are an annoyance; at $25, they really hurt.

“People do not change when you tell them they should; they change when they tell themselves they must,” observed Michael Mandelbaum, the Johns Hopkins University foreign policy specialist. And nothing would tell Iran’s leaders that they must change more than collapsing oil prices.

Mr. Obama has already started some excellent energy-saving initiatives. But we need more. Imposing an immediate “Freedom Tax” of $1 a gallon on gasoline — with rebates to the poor and elderly — would be a triple positive: It would stimulate more investment in renewable energy now; it would stimulate more consumer demand for the energy-efficient vehicles that the reborn General Motors and Chrysler are supposed to make; and, it would reduce our oil imports in a way that would surely affect the global price and weaken every petro-dictator.

That is how — as Bill Maher likes to say — we make the bad guys “fight all of us.”

Sure, it would take time to influence the regime, but, unlike words alone, it will have an impact. I believe in “The First Law of Petro-Politics,” which stipulates that the price of oil and the pace of freedom in petrolist states — states totally dependent on oil exports to run their economies — operate in an inverse correlation. As the price of oil goes down, the pace of freedom goes up because leaders have to educate and unleash their people to innovate and trade. As the price of oil goes up, the pace of freedom goes down because leaders just have to stick a pipe in the ground to stay in power.

Exhibit A: the Soviet Union. High oil prices in the 1970s suckered the Kremlin into propping up inefficient industries, overextending subsidies, postponing real economic reforms and invading Afghanistan. When oil prices collapsed to $15 a barrel in the late 1980s, the overextended, petrified Soviet Empire went bust.

In a 2006 speech entitled “The Collapse of an Empire: Lessons for Modern Russia,” Yegor Gaidar, a deputy prime minister of Russia in the early 1990s, noted that “the timeline of the collapse of the Soviet Union can be traced to Sept. 13, 1985. On this date, Sheikh Ahmed Zaki Yamani, the minister of oil of Saudi Arabia, declared that the monarchy had decided to alter its oil policy radically. The Saudis stopped protecting oil prices, and Saudi Arabia quickly regained its share in the world market.

“During the next six months,” added Gaidar, “oil production in Saudi Arabia increased fourfold, while oil prices collapsed by approximately the same amount in real terms. As a result, the Soviet Union lost approximately $20 billion per year, money without which the country simply could not survive.”

If we could bring down the price of oil, the Islamic Republic — which has been buying off its people with subsidies and jobs for years — would face the same pressures. The ayatollahs would either have to start taking subsidies away from Iranians, which would only make the turbaned shahs more unpopular, or empower Iran’s human talent — men and women — and give them free access to the learning, science, trade and collaboration with the rest of the world that would enable this once great Persian civilization to thrive without oil.

Let’s get serious: An American Green Revolution to end our oil addiction — to parallel Iran’s Green Revolution to end its theocracy — helps us, helps them and raises the odds that whoever wins the contest for power, there will have to be a reformer. What are we waiting for?

Resolutely Irresolute: Obama dithers while Tehran burns.
Weekly Standard
by Stephen F. Hayes & William Kristol
06/29/2009, Volume 014, Issue 39

The events of the past week in Iran, following the June 12 presidential election there, have been remarkable and hopeful. It's been a moment when one would like a president of the United States--who has, in such moments, a supporting but not an inconsequential role--to rise to the occasion. Barack Obama hasn't. We are therefore put in the position of hoping that the words of an American president are being mostly ignored, that his weakness won't matter, and that the forces of reform or revolution will be able to prevail--as they may--with the support of many in America, if not the president.

The day after the election, as hundreds of thousands of Iranians gathered in the streets to protest election fraud, White House press secretary Robert Gibbs said the administration was "monitoring" the situation. The next day, Sunday, as the extent of the fraud became clear to anyone willing to see it, Vice President Joe Biden said that while there were "doubts" about the outcome, "I don't think we're in a position to say" that the election wasn't free and fair. Obama played golf.

On Monday, Obama finally had something to say: "I think it would be wrong for me to be silent about what we've seen on the television over the last few days." He said he was "deeply troubled" by the violence but noted, "We respect Iranian sovereignty and want to avoid the United States being the issue inside of Iran." Eight people were killed that day.

On Tuesday, Obama acknowledged the "amazing ferment" inside Iran. But, as the forces of change rallied behind Mir-Hussein Mousavi, and as Mousavi, heretofore a cautious apparatchik, was carried along Yeltsin-like to a position of virtual opposition to the regime, Obama seemed to try to take the steam out of the protest, declaring, "The difference between Ahmadinejad and Mousavi in terms of their actual policies may not be as great as has been advertised." Meanwhile Gibbs said that while Obama "deplored the violence"--disembodied violence, whose perpetrators went unnamed--he was nonetheless encouraged by the "vigorous debate inside of Iran by Iranians."

On Wednesday, Gibbs repeated those words verbatim and reported that the president would continue to "ensure that we're not meddling." And on Thursday, Gibbs once again said the president "deplored unnecessary killing." Senator John Kerry, defending Obama, said, "We can't escape the reality that for reformers in Tehran to have any hope for success, Iran's election must be about Iran--not America."

All week, the Obama administration bent over backwards to avoid questioning the legitimacy of the Iranian regime. In this, Obama became a de facto ally of President Mahmoud Ahmadinejad and Supreme Leader Ali Khamenei. Although Obama finally spoke about the protesters--"the whole world is watching," he said--he never expressed real support for them.

Obama supporters defended his silence. Anything he said to endorse the protests, they argued, would taint the protesters' message and damage their cause.

The protesters, many of whom held signs written in English, seemed to disagree. "On several occasions, I've had supporters of Mousavi say we need President Obama," reported CNN's Reza Sayah, from Tehran. When Wolf Blitzer asked Sayah directly whether the protesters want Obama to speak out in support of their cause, Sayah responded: "I think they do, but they're realistic."

"Realistic" about the weakness, about the foolish and counterproductive "realism," of an American president. How sad.

Two weeks earlier, Obama had promised in Cairo, in his address to the Muslim world, a "new beginning" in U.S.-Muslim relations. He spoke of his belief in democracy and of his "unyielding belief that all people yearn for certain things: the ability to speak your mind and have a say in how you are governed; confidence in the rule of law and the equal administration of justice; government that is transparent and doesn't steal from the people; the freedom to live as you choose."

Those are not just American ideas, he said, but universal human rights. "And that is why we will support them everywhere."

Except not in Iran. And not when it matters.

Yet there is good news: Obama is not the only one to speak for America. After the president's week of equivocation, stubbornly continuing to dodge and weave so that, we suppose, he couldn't be blamed if anything went wrong, or so that Khamenei and Ahmadinejad wouldn't be mad at him in case they prevailed, both houses of Congress passed resolutions in support of the Iranian people. In its resolution, adopted 405 to 1, the House

(1) expresses its support for all Iranian citizens who embrace the values of freedom, human rights, civil liberties, and rule of law;

(2) condemns the ongoing violence against demonstrators by the Government of Iran and pro-government militias, as well as the ongoing government suppression of independent electronic communication through interference with the Internet and cell phones; and

(3) affirms the universality of individual rights and the importance of democratic and fair elections.

The lone "no" vote came from Representative Ron Paul. "I have admired President Obama's cautious approach to the situation in Iran," said Paul, "and I would have preferred that we in the House had acted similarly."

That was apparently enough to push the White House over the edge. After the House vote Friday afternoon, Robert Gibbs said the resolution's language is "very consistent" with what President Obama has been saying. Indeed, he claimed, "it echoes the words of President Obama throughout the week."

Right. Still, better late than never.

In 1823, first-term congressman Daniel Webster spoke up in support of the Greek revolution. Responding to critics who said that mere rhetorical support would do the revolutionaries no good, Webster said: "I hope it may. It may give them courage and spirit. It may assure them of public regard, teach them that they are not wholly forgotten by the civilized world, and inspire them with constancy in the pursuit of their great end."

And in any case, Webster continued, support for those fighting for freedom abroad was "due to our own character, and called for by our own duty."

French president Nicolas Sarkozy seemed to grasp this aspect of leadership when he said, "We support the Iranian people, and today the Iranian people are on the street."

It's not too late for the president of the United States to act in a manner due to our own character and called for by our own duty.

--Stephen F. Hayes and William Kristol

Hope and Change -- but Not for Iran
Washington Post
By Charles Krauthammer
Friday, June 19, 2009

Millions of Iranians take to the streets to defy a theocratic dictatorship that, among its other finer qualities, is a self-declared enemy of America and the tolerance and liberties it represents. The demonstrators are fighting on their own, but they await just a word that America is on their side.

And what do they hear from the president of the United States? Silence. Then, worse. Three days in, the president makes clear his policy: continued "dialogue" with their clerical masters.

Dialogue with a regime that is breaking heads, shooting demonstrators, expelling journalists, arresting activists. Engagement with -- which inevitably confers legitimacy upon -- leaders elected in a process that begins as a sham (only four handpicked candidates permitted out of 476) and ends in overt rigging.

Then, after treating this popular revolution as an inconvenience to the real business of Obama-Khamenei negotiations, the president speaks favorably of "some initial reaction from the Supreme Leader that indicates he understands the Iranian people have deep concerns about the election."

Where to begin? "Supreme Leader"? Note the abject solicitousness with which the American president confers this honorific on a clerical dictator who, even as his minions attack demonstrators, offers to examine some returns in some electoral districts -- a farcical fix that will do nothing to alter the fraudulence of the election.

Moreover, this incipient revolution is no longer about the election. Obama totally misses the point. The election allowed the political space and provided the spark for the eruption of anti-regime fervor that has been simmering for years and awaiting its moment. But people aren't dying in the street because they want a recount of hanging chads in suburban Isfahan. They want to bring down the tyrannical, misogynist, corrupt theocracy that has imposed itself with the very baton-wielding goons that today attack the demonstrators.

This started out about election fraud. But like all revolutions, it has far outgrown its origins. What's at stake now is the very legitimacy of this regime -- and the future of the entire Middle East.

This revolution will end either as a Tiananmen (a hot Tiananmen with massive and bloody repression or a cold Tiananmen with a finer mix of brutality and co-optation) or as a true revolution that brings down the Islamic Republic.

The latter is improbable but, for the first time in 30 years, not impossible. Imagine the repercussions. It would mark a decisive blow to Islamist radicalism, of which Iran today is not just standard-bearer and model, but financier and arms supplier. It would do to Islamism what the collapse of the Soviet Union did to communism -- leave it forever spent and discredited.

In the region, it would launch a second Arab spring. The first in 2005 -- the expulsion of Syria from Lebanon, the first elections in Iraq and early liberalization in the Gulf states and Egypt -- was aborted by a fierce counterattack from the forces of repression and reaction, led and funded by Iran.

Now, with Hezbollah having lost elections in Lebanon and with Iraq establishing the institutions of a young democracy, the fall of the Islamist dictatorship in Iran would have an electric and contagious effect. The exception -- Iraq and Lebanon -- becomes the rule. Democracy becomes the wave. Syria becomes isolated; Hezbollah and Hamas, patronless. The entire trajectory of the region is reversed.

All hangs in the balance. The Khamenei regime is deciding whether to do a Tiananmen. And what side is the Obama administration taking? None. Except for the desire that this "vigorous debate" (press secretary Robert Gibbs's disgraceful euphemism) over election "irregularities" not stand in the way of U.S.-Iranian engagement on nuclear weapons.

Even from the narrow perspective of the nuclear issue, the administration's geopolitical calculus is absurd. There is zero chance that any such talks will denuclearize Iran. On Monday, President Ahmadinejad declared yet again that the nuclear "file is shut, forever." The only hope for a resolution of the nuclear question is regime change, which (if the successor regime were as moderate as pre-Khomeini Iran) might either stop the program, or make it manageable and nonthreatening.

That's our fundamental interest. And our fundamental values demand that America stand with demonstrators opposing a regime that is the antithesis of all we believe.

And where is our president? Afraid of "meddling." Afraid to take sides between the head-breaking, women-shackling exporters of terror -- and the people in the street yearning to breathe free. This from a president who fancies himself the restorer of America's moral standing in the world.

Op-Ed Columnist
Recession and Revolution
NYTIMES
By ROSS DOUTHAT
June 16, 2009

Economic fiascos usually have political consequences, and it was only a matter of time before the ripples from the Great Recession produced a crisis in one of the world’s more volatile powers.

Luckily for America, it’s happening in Iran.

Americans are accustomed to fretting about how theology shapes Iranian politics. But you don’t need to be an expert in Shi’a eschatology to understand how last week’s volatile election gave way to an exercise in self-discrediting thuggery by Iran’s clerical leadership. Worldly forces made the current crisis possible: Stagnating G.D.P., rising joblessness, and runaway inflation.

Even if this week’s crackdown somehow strengthens Mahmoud Ahmadinejad’s hand within the ruling clique, the regime as a whole has been severely weakened. The patina of democracy was a useful thing for the ruling mullahs, and riot police can’t make Iran’s economic problems go away. (Iranian statistics put unemployment at 17 percent and the inflation rate at 25 percent; the real numbers may be higher. And chronic mismanagement may even send Iran’s oil revenues — the backbone of its faltering economy — into steep decline.) Their monopoly on violence notwithstanding, the leaders of the Islamic Republic look less like the Nazis of the Middle East, and more like hapless Weimar functionaries watching their country’s finances circle the drain.

In 1930s Europe, a economic crisis toppled democratic governments, and swept dictators into power. Liberal societies seemed ineffectual; authoritarianism was the coming thing.

The crash of 2008, though, may end up having the opposite effect. Over the last few years, both American alarmists and anti-American triumphalists have emphasized the disruptive power of populist, semi-authoritarian political actors — from Ahmadinejad’s Iran to Vladimir Putin’s Russia to Hugo Chavez’s Venezuela. But these regimes, which depend on petro-dollars for stability at home and influence abroad, may prove far more vulnerable to economic dislocation than their democratic rivals.

Amid the wreckage of the Great Depression, intellectuals and policymakers looked to fascist Italy and the Soviet Union for inspiration. But it’s hard to imagine anyone seeing a model in the current crop of authoritarian governments. It’s much easier to imagine them being swept away, if the recession endures, by domestic discontent.

Maybe something worse would take their place. Certainly there are authoritarian states — Egypt, Saudi Arabia — where the danger of an Islamist revolution should keep American policymakers awake at night.

But as an ideological rival to liberal democracy, Islamism isn’t in the same league with the totalitarianisms of the 1930s. And there aren’t any other likely candidates on the horizon. Indeed, for all the talk about a crisis of global capitalism, what’s most striking about the great financial meltdown is how little radicalism it’s spawned.

In the West, especially, there’s been more hysteria about the specter of extremism than actual radical activity. If you listen to certain conservative media personalities, you’d think Obama is channeling Leon Trotsky. If you listen to certain liberal pundits, you’d think that talk radio was fomenting a wave of right-wing violence.

But nothing of the sort is happening. Barack Obama is pushing the United States leftward, but his wish list — universal health care, a green industrial policy — has been pinned to the Democratic National Committee’s bulletin board since the 1970s. Glenn Beck and Bill O’Reilly do not, in fact, command an army of gun-toting vigilantes, the crimes of a few lunatics notwithstanding. And in Europe, despite the angst over a few penny-ante racists getting themselves elected to the E.U. Parliament, the crisis’s major beneficiaries have been the cautious, incrementalist parties of the center-right.

In Iran, students are protesting for democracy and shouting for Obama. In the West, meanwhile, nobody’s talking about adopting Putinist economic nationalism, or renovating the financial sector using the tenets of the Islamic banking system, or imitating Hugo Chavez’s “Bolivarian Socialism.” (You’ll sometimes hear admiring comments about China’s recent economic management — but never their one-party dictatorship.)

Our current global economic crisis was created by Western-style democratic capitalism. But it hasn’t turned into a crisis for democracy and capitalism, because nobody has a plausible alternative.

The appeal of authoritarianism, once upon a time, was based on the hope that it might deliver growth, prosperity, and happiness more efficiently than its liberal rivals. But nobody thinks that anymore — not in Washington or London or Tokyo or Berlin, and not, on the evidence of this week’s events, in the Islamic Republic of Iran.

Which is why, if the West is fortunate, the current crisis could reverse the pattern of the Great Depression - by demonstrating the resilience of a global democratic order, and the weakness of its challengers.

PRUDEN: 'Inner Muslim' at work in Cairo
Washington Times
Wesley Pruden
Friday, June 5, 2009

OPINION/ANALYSIS:

Now it's on to Normandy, to apologize to the Germans. It's the least an American president can do after the way the Allied armies left so much of Europe in rubble. There's a lot of groveling to do for what America accomplished in the Pacific, too.

This prospect should appeal to Barack Obama, who relishes the role of Apologizer-in-Chief. Apologizing for manifold sins against civilization is not always easy, but it's simple enough: "Blame America First." You just open a vein and let it flow. In Cairo, Mr. Obama opened an artery.

America, unlike the president, is guilty of hubris, arrogance and cant. All that must change. "Change" is what the smooth-talking Chicago messiah says he is all about. "Given our interdependence, any world order that elevates one nation or group of people over another will inevitably fail," he told the Muslim elites Thursday at Cairo U. "So whatever we think of the past, we must not be prisoners of it." It's not "a world order" that elevates America, but events. No other country is as generous, as forgiving, as willing to sacrifice blood and bone when the world calls for help. If not America, who? Hasn't the president heard?

Big talkers don't know when to stop when they're on a rhetorical roll because they can't remember which facts are actually facts and which "facts" they're making up. Mr. Obama even attributed the Golden Rule, from the teachings of Christ, to "every religion." In an interview before the Cairo speech, he called the United States one of "the largest Muslim countries," based on its Muslim population, and he later put the number of Muslims in America at 7 million, more than even most Islamic advocacy groups claim. The most reliable estimate, by the nonpartisan Pew research organization, is 1.8 million. That would make the United States the 48th "largest" Muslim nation, just behind Montenegro. Mr. Obama often has trouble with numbers, big and small; he once boasted of having campaigned in 57 states.

Mr. Obama described himself as "a Christian, but," and offered a hymn to the Muslim roots he insisted during the late presidential campaign he didn't have. He invoked his middle name, "Hussein," as evidence that he was one of "them." The Obama campaign insisted last year that anyone who uses the middle name was playing with racism.

He told the Cairo audience that "to move forward we must say openly the things we hold in our hearts," but he wasted the opportunity to forcefully instruct Muslims that respect and appreciation must be mutual. While conceding the mote in American eyes, he said almost nothing about the beam that blinds Muslim eyes. He enumerated the "sources of tension" between Islamic countries and the West and never mentioned terrorism. He chided the West for its harsh view of Islamic treatment of women - "I reject the view of some in the West that a woman who chooses to cover her hair is somehow less equal" - and suggested that denying education to women is the gravest Muslim sin against women. He could have denounced "honor killings," forced marriages and how women in Muslim countries are flogged on the pretext of minuscule violations of eighth-century Sharia law.

But it was more fun to fish for applause by berating America and throwing rocks at Israel. "Let there be no doubt: The situation for the Palestinian people is intolerable. America will not turn our backs on the legitimate Palestinian aspiration for dignity, opportunity and a state of their own." Israel, he said, must "live up to its obligations," but he had hardly a word of rebuke for the long record of broken Palestinian promises. It was a remarkable insult to an absent ally, delivered to the applause of Israel's sworn enemies.

Mr. Obama's revelation of his "inner Muslim" in Cairo reveals much about who he is. He is our first president without an instinctive appreciation of the culture, history, tradition, common law and literature whence America sprang. The genetic imprint writ large in his 43 predecessors is missing from the Obama DNA. He no doubt meant no offense in returning that bust of Churchill ("Who he?") or imagining that a DVD of American movies was appropriate in an exchange of state gifts with Gordon Brown. Nor did he likely understand why it was an offense against history (and good manners) to agree to the exclusion of the Queen from Saturday's commemoration of the Anglo-American liberation of France. Kenya simply routed Kansas.

The great Cairo grovel accomplished nothing beyond the humiliation of the president and the embarrassment of his constituents, few of whom share his need to put America on its knees before its enemies. No president before him has ever shamed us so. We must never forget it.

• Wesley Pruden is editor emeritus of The Washington Times.

TESTING O'S LIMITS (HE HAS NONE)
NYPOST
By RALPH PETERS
May 31, 2009 --

In the old days at Officer Candidate School, the "tac officers," snapping and snarling, would circle a hapless would-be lieutenant:

"You're lost, Candidate."

"You're confused.

"What are you going to do now?"

"Make a decision! Make a decision!"

That cherished image of the bewildered victim of calculated harassment fits President Obama perfectly, when it comes to the shambles he's made of foreign policy in record time.

Around the globe, our enemies -- immediate and potential -- are testing Obama to see how far they can go. Thus far, he hasn't set a limit anywhere. Not a single dictator or terrorist leader got a single time-out.

Last week, North Korea nuke-mooned him, then spit missiles in multiple directions. Our president admonished Pyongyang. Words solve everything in Obama-World.

The Master of the Teleprompter didn't seem to grasp the basics: Like spoiled brats, the North Koreans were demanding attention (and got it); Pyongyang never honors agreements; and, above all, this isn't our problem to solve -- it's China's. We just need to worry about nuke exports and keep our Navy gainfully employed.

Instead, we've let ourselves be set up as the bad cop, with Beijing as the good cop. We get the responsibilities, Beijing gets the benefits.

Until Beijing decides to get tough on North Korea, nothing happens. China keeps North Korea on a lifeline, viewing the famine-plagued land of routine horrors as a potential economic slave-state, once the Kim dynasty disintegrates. Beijing's been confident that it's ultimately in control of the neighborhood nukes.

Now the Chinese are having second thoughts: By allowing North Korea to go nuke, Beijing made a mistake similar to our own in backing the worst Islamist elements against the Soviets in Afghanistan.

We thought we could manage the Mujaheddin. China thought it could control the North Koreans. Now the dark-suited men in Beijing aren't so sure.

Toss them the football. We've got enough to do.

A pervasive flaw in Obama's approach to all foreign-policy problems is his chattering-class conviction that individuals and states will behave rationally in a crisis. History suggests otherwise (does Kim Jong-Il look rational to you?). But Obama lives in a world of contractual relations, the realm of the Harvard Law Review.

Our opponents view the world as a zero-sum game. And calm demeanors aren't their strong suit.

Iran's also defiant, plowing ahead with its nuclear-weapons program. As it turns out, Tehran has plenty of reasons to be confident that Obama won't act against the regime: the administration has yanked -- hard -- on Israel's military leash while engaging in murky dealings with Iran.

I'd love to know how Obama really feels about Israel.

Then there's Hugo "Embraceable You" Chavez, who's almost done dismantling Venezuela's once-robust democracy. Elected officials from the opposition are beaten, jailed, locked out or driven into exile. Media freedom's nearly dead. A once-vibrant economy's a disaster. Corruption and demagoguery reign. And Chavez wants nukes, too.

Out of words, for once, Obama has nothing to say.

What does democracy matter, anyway? Ballots and human rights are so Bush-Cheney. In the next few days, Obama will rush to embrace the authoritarian regime in Egypt before crawling to Saudi Arabia. (How deep will his bow to the king go this time? Will photographers be kept away?)

Al Qaeda's just a symptom. Wahhabism, sponsored globally by the Saudis, is the disease. And don't Obama's swooners-in-sweatpants care about the rights of Muslim women?

Sorry, I mis-wrote. Muslim women don't have rights. Rights are for college-educated Western BFFs who trade tips on day-spas and where to get the best price on organic cat food.

(Then there's Speaker Pelosi, who worried so terribly about the human rights of a handful of terrorists at Gitmo, but didn't dare whisper one criticism of Beijing's abuses of a billion Chinese during her recent pilgrimage to Beijing.)

And don't overlook Russia, where we "hit the re-set button." Well, the button must've been made in China, because it not only doesn't work -- it's poisonous. Putin continues to menace his neighbors, suppress dissent (murderously, when necessary), and undercut every effort we make in the region.

Obama's so desperate to get an arms treaty that he's offering huge, unbalanced cuts in our nuclear arsenal. Feel safe yet?

While everything else is falling down around our president, the Obama Doctrine stands: Every enemy is a friend, or can be made into one. Let's talk about it.

Meanwhile, Obama's so far out of his depth that the only role-model he can turn to for Afghanistan is LBJ. Don't have a clue what to do? Send more troops.

In Vietnam, we at least had secure supply lines and sensible rules of engagement. But, then, why feel sorry for our soldiers? Obama's supporters know that those in uniform are all expendable losers. Since the change in administrations, we haven't heard many chants of "Support our troops, bring them home!"

The hypocrisy's inexhaustible.

Pakistan, Iraq, Somalia, our border with Mexico . . . Gitmo . . . better order some back-up teleprompters.

Ralph Peters is Fox News' Strategic Analyst and the author of "Looking For Trouble."

Op-Ed Contributor
Driving the Bond Markets to Ruin
By JAMES K. GLASSMAN
May 30, 2009

Washington

GENERAL MOTORS bondholders have until 5 p.m. on Saturday to accept a parsimonious offer to exchange their loans for stock and warrants. Most likely, enough of the creditors will say no to force G.M. into bankruptcy. But there is no escaping the long-term damage that has been inflicted on credit markets by the Obama administration’s attempts to reward the United Auto Workers, one of the president’s strongest supporters in the last election, while trampling decades of legal precedent regarding owners of corporate debt.

The G.M. debacle is déjà vu all over again. In the Chrysler bankruptcy arranged by the government in April, bondholders also got short shrift, while the union, which might have received little or nothing in a normal bankruptcy, was awarded 55 percent of the company.

What’s my interest in this? I head a nonprofit group that encourages developing nations to adopt policies that will lead to prosperity — starting with transparency and the rule of law — and hold up America as a model. Yet in its high-handed dealings with Chrysler and G.M., the Obama administration reminds me of an irresponsible third-world regime, skirting the law and handing economic prizes to political cronies.

Under the complicated G.M. plan, bondholders — ranging from large institutions to low-income retirees — would receive just 10 percent of the reorganized company, plus warrants that would enable them to get 15 percent more should the company’s value reach certain levels, in return for their $27 billion in loans. The government, which could end up putting $70 billion into G.M., would initially get 72.5 percent of the company.

In return for money G.M. owes its health trust, the auto workers’ union would get 17.5 percent of its stock, warrants to raise that share to 20 percent, along with a $2.5 billion cash payout over eight years and $6.5 billion in preferred stock paying a 9 percent dividend. I agree with bondholders who feel the union is getting at least four times as much of G.M. in return for claims that are, at best, equal to those of the creditors.

Even if the courts were to reject the plans for G.M. and Chrysler, the administration’s actions in trying to force the deals may damage the credit markets for years to come. The treatment of the bondholders is a warning to investors that the federal government won’t hesitate to push them aside in a crisis.

Perhaps it’s no coincidence that in the wake of the Chrysler deal we have seen a decline in prices for long-term Treasury bonds and a sinking dollar. The Chinese, for example, could view things this way: If the United States is willing to skirt the law to help some of the president’s closest political supporters gain large pieces of two of the world’s biggest companies, will Washington necessarily stand behind any Treasury securities we own when it becomes politically inexpedient?

The hardball tactics, furthermore, are unlikely to save G.M. In a normal bankruptcy, the company’s assets pass from weak hands to strong. In 2008, a terrible year for the auto industry, G.M. sold 8.4 million vehicles worldwide, collecting revenues of $148 billion that placed it third among non-energy companies on the Fortune 500.

G.M. is a global business, with two-thirds of its revenues coming from outside the United States. While sales last year dropped 21 percent in North America, they rose 30 percent in Russia, 10 percent in Brazil and 9 percent in India. In 2008, G.M. sold more than one million vehicles in China, up 6 percent over 2007.

(The value of its global operations was made clear on Friday when the company reached a tentative deal to sell G.M. of Europe.)

Of course, the company’s problem is that its expenses exceed its revenues. But in strong hands, G.M. could be a going concern. Unfortunately, the new owners, with about nine-tenths of the shares, will be the government and the U.A.W. These are the same hands that shaped much of G.M.’s trouble in the first place. With substantial union co-ownership, labor costs won’t be contained; and with the government as the boss, politics may trump markets in decisions on such matters as where to put plants and whether to build big cars or small ones.

The deal would also put G.M.’s competitors at a serious disadvantage in the short run. Ford, which has been building better cars lately, prudently raised cash against a decline in demand, playing the ant to G.M.’s grasshopper. Now, Ford will face a G.M. buoyed by taxpayer dollars both for manufacturing and for cheap consumer and dealer financing.

The same holds true for the manufacturers that hold the key to future auto-making jobs: well-managed, foreign-based companies like Toyota and Honda, which, according to the automotive analysts at CSM Worldwide, will build more cars in the United States next year than G.M., Chrysler and Ford combined.

What lesson does federal favoritism toward Chrysler and G.M. teach other businesses that play by the rules? How will our trade negotiators keep a straight face when complaining about subsidies to Airbus or Chinese steel makers? The government should have stepped aside earlier and allowed a normal bankruptcy that would have treated the union and the debt-holders fairly. Fortunately, if the bondholders stand firm, we’re likely to see that process begin on Monday.

Just south of the golf course...
Antigua's 'Mount Obama' to Be National Park
NYTIMES
By THE ASSOCIATED PRESS
May 26, 2009Filed at 4:13 p.m. ET

ST JOHN'S, Antigua (AP) -- Antigua plans to do more than just rename its highest peak to honor President Barack Obama.

Prime Minister Baldwin Spencer says his government wants to create Mount Obama Monument and National Park with a new network of hiking trails. He also plans a museum with entertainment and educational facilities.

Spencer says Mount Obama will be a ''beacon of hope for all people.''

He outlined his plan to reporters Monday. He did not say how much it would cost or how the government of the dual-island nation of Antigua and Barbuda would pay for it.

The 1,319-foot (402-meter) mountain is currently known as Boggy Peak. It will be renamed on Aug. 4 -- Obama's birthday. Spencer says the U.S. president will be invited to the ceremony.

Op-Ed Columnist
And the Angels Rejoice
NYTIMES
By DAVID BROOKS
May 26, 2009

There is nothing so inspiring as public service, so I’ve been incredibly moved over the past few weeks to watch squads of corporate executives come to the White House so President Obama could announce that he was giving away their money.

A few weeks ago, we were privileged to see a gathering of health care executives standing behind the president as he announced that they would be donating $2 trillion in future revenue to the cause of health care reform.

Recently we were uplifted when the president informed Chrysler’s secured creditors that they had agreed to donate their ownership stake in the company to the United Auto Workers. Just last week, we were enthralled to see a group of auto executives beaming with pride as the president announced that in order to reduce gas consumption, they would henceforth be scaling back on all those car lines that consumers actually want to buy.

These events have heralded a new era of partnership between the White House and private companies, one that calls to mind the wonderful partnership Germany formed with France and the Low Countries at the start of World War II. The press conferences and events marking this new spirit of cooperation have been the emotional highlights of the administration so far.

These events usually begin when the executives gather in the Oval Office, where they experience certain Enhanced Negotiating Techniques. I’m not exactly sure what the president does to inspire the business leaders’ cooperation and sense of public service, though those who remember the disembowelment scene in “Braveheart” will have a general idea.

Then the president leads the executives out onto the White House lawn for the announcement ceremony. Often, the president will still be carrying the riding crop and the pliers used in the private negotiation. He moves to the microphone while the executives take their pre-assigned places behind him, the jingle of their leg shackles blending with the dulcet tones of spring. I thought one hospital executive was so moved by the occasion that he had slipped into catatonic shock, except that he was blinking “Save Me! Save Me!” in Morse code to his shareholders.

“We meet at an exciting moment for our country, a time of unprecedented cooperation between government and private industry,” the president intones, lifting his foot from the trachea of an unconscious pharmaceutical executive. “Many of the business leaders behind me have seized an exciting opportunity to join the nonprofit sector without even switching jobs.”

At this, the C.E.O.’s behind him don frozen smiles, exuding the sort of spontaneous enthusiasm often seen at North Korean pep rallies.

During the press conference with health care executives, I don’t even think Obama meant to give away $2 trillion of their money. He was going to give away just $750 billion, but he got carried away by the Era of Responsibility. “The stakeholders behind me have promised to cut costs by nearly 2 percent a year,” the president riffed. (The executives’ lips were like dead worms stretched across mirthless smiles. Their cheeks were like hardened clumps of concrete.) “They have agreed to support the administration’s reform package.” (Coronaries, epileptic seizures all around.) “They have agreed to donate their kidneys in my office right after this ceremony.” (The executives were now flopping about the stage, like a 3-D version of the Heimlich poster.)

These executives have been invited to make these donations in the same spirit that the Cossacks invited my ancestors to emigrate to the Lower East Side. And yet there is a moment during each of the ceremonies when the spirit of the Almighty descends upon the congregation. It usually happens while the president is describing the glorious future. He’ll be describing how, in three years, he will slash the deficit by cutting taxes and doubling spending. He will be describing how, in three years, he will create millions of jobs by raising energy costs.

You can see the ecstasy of Washington promise-making spread joy from soul to soul. Infected by these visions, automakers vow that in three years they will have created a resurgence of enthusiasm around the Chevy Aveo. Financiers vow they will build an entirely new banking industry that doesn’t rely so much on loan repayment. Health care executives vow that in three years they’ll perform CAT scans at Kinko’s.

Some say these are just meaningless promises that ignore hard choices and that no one has any intention of keeping. But this is ungenerous. At these events, the president has taken former rivals and has joined them in the holy bonds of mutual fantasy. He has taken a divided nation and has given us photo-ops to bind us and remind us of our common humanity. Business lies down with government. Management embraces labor. You call it what you will; I call it beautiful.

President Above-It-All : There Obama stands, bravely holding his flanks against straw men on all sides.
National Review
By Rich Lowry
May 22, 2009, 0:00 a.m.

Put Barack Obama in front of a teleprompter and one thing is certain — he’ll make himself appear the most reasonable person in the room.

Rhetorically, he is in the middle of any debate, perpetually surrounded by finger-pointing extremists who can’t get over their reflexive combativeness and ideological fixations to acknowledge his surpassing thoughtfulness and grace.

This is how Obama, whose position on abortion is indistinguishable from NARAL’s, can speechify on abortion at Notre Dame and come away sounding like a pitch-perfect centrist. It’s natural, then, that his speech at the National Archives on national security should superficially sound soothing, reasonable, and even a little put-upon (oh, what President Obama has to endure from all those finger-pointing extremists).

But beneath its surface, the speech — given heavy play in the press as an implicit debate with former Vice President Dick Cheney, who spoke on the same topic at a different venue immediately afterward — revealed something else: a president who has great difficulty admitting error, who can’t discuss the position of his opponents without resorting to rank caricature, and who adopts an off-putting pose of above-it-all self-righteousness.

Obama has reversed himself since becoming president on detaining terrorists indefinitely and on trying them before military commissions. Once upon a time, these policies were blots on our honor; now they are simple necessities. Between the primary and the general election, candidate Obama changed his mind and embraced Pres. George W. Bush’s terrorist-surveillance program. In recent weeks, he countermanded his own Justice Department’s decision not to contest a court decision that would have led to the release of photos of detainee abuse.

A less self-consciously grandiose figure might feel the need to reflect on the fact that his simplistic prior positions had not fully taken account of the difficulties inherent in fighting the War on Terror. Not Obama. On the commissions, he explicitly denied changing his view, instead trumpeting cosmetic changes he’s proposed as major reforms that will bring them in line “with the rule of law.”

For all his championing of nuance, Obama comes back to one source for every dilemma: Bush, as though without his predecessor every question about how a nation of laws protects itself from a lawless enemy would be easy. Under Bush, according to Obama, we set our “principles aside as luxuries we could no longer afford.” Even now, there are those — are you listening, Mr. Former V.P.? — “who think that America’s safety and success require us to walk away from the sacred principles enshrined in this building.” What a shoddy smear.

Consider Obama’s breaks with Bush: We have stopped using enhanced interrogation techniques for now, but Obama reserves the right to use them again; we will have military commissions but with four procedural changes; we’re going to close Gitmo but find some equivalent detention facility for that category of detainees who, Obama says, are dangerous but can’t be tried or released. These are matters of degree and therefore questions of prudence, not principle. If Bush violated our fundamental beliefs, then Obama is violating them, too, only a little less so.

Excoriating Bush is good politics for Obama, which is what makes his repeated exhortations to look ahead so disingenuous. In his speech, he rued that “we have a return of the politicization of these issues.” In other words: Dick Cheney, please shut up. But when did the politicization of these issues end? Has the Left ever stopped braying about Bush’s war crimes?

Obama bracingly politicized these very issues on the stump, staking out unsustainably purist positions because they suited his momentary political interest. Now that’s he’s president, he wants the debate to end. He’s above the grubbily disputatious culture of partisans and journalists. And he’s above contradiction because, as ever, he occupies the middle ground, one “obscured by two opposite and absolutist” sides: those who recognize no terrorist threat and those who recognize no limits to executive power.

And there Obama stands, bravely holding his flanks against straw men on all sides.

— Rich Lowry is the editor of National Review. © 2009 by King Features Syndicate

THE ENEMY AMONGST US
NYPOST editorial
May 22, 2009

It's scant comfort that the four men ar rested Wednesday night as they car ried out what they thought was their own private jihad -- attempting to car-bomb two Riverdale synagogues and shoot down military planes in upstate Newburgh -- were not trained terrorists.

Don't be misled by the amateurish nature of their misadventure. What the four lacked in brains, they more than made up for in malign intent.

And the fact that their plot went as far as it did -- the men actually had planted what they thought were deadly bombs before the feds moved in -- dramatically underscores, as Police Commissioner Ray Kelly noted, the very real threat of homegrown terror cells.

The imitators, in other words, are potentially as dangerous as those sent from abroad by the likes of al Qaeda.

New York is lucky that these four were nabbed as part of an elaborate sting in which an informant supplied them with inert explosives and an inoperable Stinger surface-to-air missile.

Who's to say their dreams of unleashing death and destruction couldn't have been realized -- had they approached someone who was tied to Islamist terrorists instead of working with the feds?

The plot also raises anew questions about how America's prison system has become a breeding ground for aspiring terrorists.

All four of those arrested were Muslim, three of whom converted while doing time. As the sister of ringleader James Cromitie said: "They do a little time in jail, and they don't eat pork no more."

Three years ago, The Post broke the story of a vitriolic anti-American diatribe delivered by Imam Umar Abdul-Jalil, a Rikers Island chaplain.

"We know that the greatest terrorists in the world occupy the White House, without a doubt," he said -- later urging that American Muslims stop allowing "the Zionists of the media to dictate what Islam is to us." Muslims, he said, must be "compassionate with each other" and "hard against the kufr [unbeliever]."

Abdul-Jalil, shockingly, remains on the municipal payroll.

Then there's Warith Deem Umar, who long had a key post overseeing Islamic programs in New York's prison system, including the recruitment and training of numerous chaplains.

Umar actually boasted to The Wall Street Journal that "prison is the perfect recruitment and training ground for radicalism and the Islamic religion."

As Steven Schwartz has written: "Radical Muslim chaplains . . . acting in coordination to impose an extremist agenda have gained a monopoly over Islamic activities in America's state, federal and city prisons and jails."

Thus, it's likely no accident that the spiritual leader of the four men arrested Wednesday, the imam of a mosque in Newburgh, has worked for the state prison system since 1985.

Who knows how many potential terrorists have been inspired by the preachers of poison in our nation's prisons?

Well, at least four.

Maybe it is impossible to keep Islamist propaganda out of the prisons, but the fact that it is directly subsidized by tax dollars is simply insane.

It's time that this boil was lanced.

Op-Ed Columnist
Fiscal Suicide Ahead
NYTIMES
By DAVID BROOKS
May 15, 2009

Barack Obama came to office with a theory. He believed that the country was in desperate need of new investments in education, energy and many other areas. He also saw that the nation faced a long-term fiscal crisis caused by rising health care and entitlement costs. His theory was that he could spend now and save later. He could fund his agenda with debt now and then solve the long-term fiscal crisis by controlling health care and entitlement costs later on.

In essence, health care became the bank out of which he could fund the bulk of his agenda. By squeezing inefficiencies out of the health care system, he could have his New New Deal and also restore the nation to long-term fiscal balance.

This theory justified the tremendous ramp-up of spending we’ve seen over the last several months. Obama inherited a $1.2 trillion deficit and has quickly pushed it up to $1.8 trillion, a whopping 13 percent of G.D.P. The new debt will continue to mount after the economy recovers. The national debt will nearly double over the next decade. Annual deficits will still hover around 5 percent or 6 percent of G.D.P. in 2019. By that year, interest payments alone on the debt are projected to be $806 billion annually, according to the Congressional Budget Office.

Obama believes these deficit levels are tolerable if he can fix the long-term fiscal situation, but he hasn’t been happy about them. He’s been prowling around the White House prodding his staff to find budget cuts. Some of the ideas they have produced have been significant (Medicare reforms), some have been purely political (asking cabinet secretaries to cut $100 million in waste, fraud and abuse), and many have been gutted on Capitol Hill (cap and trade, proposed changes in charitable deductions, proposed changes to the estate tax).

In any case, these stabs at fiscal discipline haven’t come close to keeping up with the explosion in spending. The government now borrows $1 for every $2 it spends. A Treasury bond auction earlier this month went poorly, suggesting the world’s hunger for U.S. debt is not limitless. President Obama has been thrown back on his original theory. If he is going to sustain his agenda, if he is going to prevent national insolvency, he has to control health care costs. Health care costs are now the crucial issue of his whole presidency.

Obama and his aides seem to understand this. They have gone out of their way to emphasize the importance of restraining costs. The president has held headline-grabbing summits with business and union leaders. Unlike just about every other Democrat on the planet, he emphasizes cost control as much as expanding health coverage. o what exactly is the president proposing to help him realize hundreds of billions of dollars a year in savings?

Obama aides talk about “game-changers.” These include improving health information technology, expanding wellness programs, expanding preventive medicine, changing reimbursement policies so hospitals are penalized for poor outcomes and instituting comparative effectiveness measures.

Nearly everybody believes these are good ideas. The first problem is that most experts, with a notable exception of David Cutler of Harvard, don’t believe they will produce much in the way of cost savings over the next 10 years. They are expensive to set up and even if they work, it would take a long time for cumulative efficiencies to have much effect. That means that from today until the time President Obama is, say, 60, the U.S. will get no fiscal relief.

The second problem is that nobody is sure that they will ever produce significant savings. The Congressional Budget Office can’t really project savings because there’s no hard evidence they will produce any and no way to measure how much. Some experts believe they will work, but John Sheils of the Lewin Group, a health care policy research company, speaks for many others. He likes the ideas but adds, “There’s nothing that does much to control costs.”

If you read the C.B.O. testimony and talk to enough experts, you come away with a stark conclusion: There are deep structural forces, both in Medicare and the private insurance market, that have driven the explosion in health costs. It is nearly impossible to put together a majority coalition for a bill that challenges those essential structures. Therefore, the leading proposals on Capitol Hill do not directly address the structural problems. They are a collection of worthy but speculative ideas designed to possibly mitigate their effects.

The likely outcome of this year’s health care push is that we will get a medium-size bill that expands coverage to some groups but does relatively little to control costs. In normal conditions, that would be a legislative achievement. But Obama needs those cuts for his whole strategy to work. Right now, his spending plans are concrete and certain. But his health care savings, which make those spending plans affordable, are distant, amorphous and uncertain. Without serious health cost cuts, this burst of activism will hasten fiscal suicide.

Our view on the federal budget: Obama, Congress go AWOL on fiscal responsibility
Posted at 12:22 AM/ET, May 11, 2009 in Politics, Government - Editorial, USA TODAY editorial | Permalink
USA TODAY welcomes your views and encourages lively -- but civil -- discussions. Comments are unedited, but submissions reported as abusive may be removed. By posting a comment, you affirm that you are 13 years of age or older.

Only thing sorrier than president’s ‘cuts’ is reaction on Capitol Hill.

When it comes to federal spending, there's a pattern emerging with President Obama, and it's not a flattering one. The president says all the right things about the importance of getting the deficit under control, but his actions don't come close to matching his rhetoric.

An early sign of the disconnect was his heavily publicized demand last month that his Cabinet secretaries shave $100 million from their administrative budgets. Obama said the cuts would "send a signal that we are serious about how government operates" and would help close the "confidence gap" with skeptical Americans. Those cuts amounted to a less-than-confidence-inspiring 0.003% of the 2009 budget, or about 3 cents out of every $1,000.

Then, when he unveiled his 2010 budget last week, Obama made a big deal of his demand for $17 billion in cuts, insisting that the cuts "even by Washington standards ... are significant" and that $17 billion is "real money."

The president got it backward. Out in the rest of the world, $17 billion is a ton of money. But in Washington, where the president is proposing to spend $3.6 trillion next year, $17 billion looks puny — a little less than half a percent of the budget, or the equivalent of cutting a $100 grocery bill by handing back a 50-cent pack of gum.

If the president wants to cut outmoded or wasteful programs, more power to him. But it's disappointing that Obama's repeated pledges to hunt line-by-line through the budget for excess spending didn't produce more than this. Even George W. Bush, who never made a serious effort to balance the budget during his eight years in office, was more ambitious: He proposed $18 billion in similar cuts last year.

The only thing sorrier than Obama's effort at fiscal restraint is the reaction to it in Congress. Republicans derided Obama's proposed cuts, but where were they when spending went out of control on their watch?

Democrats, meanwhile, built a hard-earned reputation for fiscal responsibility in the 1990s. Now they're frittering it away. House Budget Committee Chairman John Spratt, D-S.C., essentially told Obama to forget his cuts, saying that "Congress is unlikely to agree with" all of them. Democratic lawmakers immediately vowed to oppose some of the proposed reductions. To name just a couple, Rep Maurice Hinchey of New York protested cuts in the presidential helicopter fleet, and Rep. Mike Ross of Arkansas sought to protect farm subsidies.

This sort of reflexive parochialism leaves us deeply concerned about whether either party, or Congress as an institution, is capable of addressing the nation's dire fiscal circumstances, which will only worsen as Baby Boomers hit retirement age. Radical deficit reduction isn't desirable at a time when the administration is spending massive amounts of money in an effort to stimulate the economy. But this is exactly the right time to hunt down serious savings from weak and wasteful spending programs — and to signal the financial markets that huge deficits won't be tolerated once the economy recovers. Instead, Obama's budget predicts deficits topping $500 billion for each of the next 10 years, adding almost $7 trillion to the national debt.Perhaps by forecasting godawful deficits now, the administration is positioning itself to claim credit for cutting them to slightly less awful levels down the road. If that's the case, it's cynical game playing. If that's not the case, then it's simply irresponsible.

Op-Ed Contributor
The G.D.P. Question
NYTIMES
By BOB PACKWOOD
May 11, 2009

Washington

PRESIDENT OBAMA’S plan to increase the tax rate on those making more than $250,000 has further fueled a national debate about the virtue of raising taxes on the “rich.” But this debate puts the cart before the horse. The real question is not how much we want to tax, but how much we want to spend. After all, the more a government spends, the more it has to tax or borrow.

There is a global trend in government spending as a percentage of gross domestic product, and that is up, up, up. Fifty years ago all governments in the United States — federal, state and local — together spent about 20 percent of the G.D.P. In 2010 that figure could approach 35 percent. This pattern is generally true of Western democracies. Thirty years ago, they typically spent less of their G.D.P. than they spend now. Today Britain exceeds 40 percent. France and Italy border on 50 percent and the Nordic countries spend even more.

So Americans have a choice. We can spend 40 percent of our G.D.P., and provide services like Britain’s national health care. If we spent like the Nordic countries, we could provide government-paid maternity leave, subsidize college tuition and offer a health plan that was close to free for all Americans. But this would leave significantly less money for taxpayers to spend as they want.

Some people might assume that we could afford the maximum amount of government largess and still avoid pain for most taxpayers by simply collecting more taxes from the “rich.” Not a chance. Let’s assume, based on historical patterns and President Obama’s suggested spending, that at some point, the spending of all governments in the United States, federal and local, could add up to 40 percent of G.D.P. Mr. Obama proposes to increase the tax rate on income over $250,000 to 39.6 percent. The billions of dollars a year raised by the higher rate won’t begin to cover the trillion or so a year in increased government spending. Nor would current state and local taxes support their share of that spending. Therefore taxes would have to be raised on Americans making less than $250,000.

One other option would be a national value-added tax on goods. But this would ultimately take its hardest toll on lower- and middle-income consumers.

Even if tax increases are limited to the so-called rich, Mr. Obama’s plan, compounded by state and local taxes, could slow the overall economy. Maybe we have not reached our limit yet. Maybe we can have a tax rate of 50 percent to 60 percent on income above $250,000 and people will still work. But at some stage the law of diminishing returns sets in.

The choice to spend less than 40 percent of G.D.P. on government services is not as easy as it once was, because the federal government has already assumed so much responsibility for shouldering the costs of health care and retirement. Fifty years ago, spending on Social Security, pensions and health care was a relatively small fraction of the total federal budget. Medicare and Medicaid did not even exist until the 1960s. Today, taxpayers are footing the bill for far more government programs. But we simply cannot raise enough money in taxes from the rich to pay for the programs the president wants.

So we basically have two options: raise taxes on the middle class, or demand that federal, state and local governments spend less.

Bob Packwood, a former chairman of the Senate Finance Committee, was a Republican senator from Oregon from 1969 to 1995.

Line By Line? Obama Off To Slow Start In Making Cuts
Editorial - Courant.com
May 11, 2009

In an effort to cut the federal budget deficit in half by the end of his first term, President Barack Obama pledged to go over the budget "line by line," cutting excessive spending and eliminating programs that don't work. Mr. Obama is finding out early that it's a nearly impossible job and that the most formidable obstacle is Congress, controlled by his own party.

Early on, the president floated the idea of cutting federal subsidies to big agribusinesses that don't need them. Sorry, new guy, farming interests with powerful friends in Congress are not about to let you get away with that. The farm pork is just one example of federal outlays that have come to be seen as entitlements by their recipients.

Thursday, Mr. Obama released details of his fiscal 2010 budget, containing $17 billion in proposed cuts gleaned from the line-by-line search. One example: eliminating the U.S. Department of Education's liaison to the Paris headquarters of the United Nations agency UNESCO, for a savings of $632,000. That's fine, even though it's a teensy drop in the bucket. The total of $17 billion in proposed cuts amounts to one-half of 1 percent of the president's $3.6 trillion budget. He can do better than that. But at least it's a start.

The problem is, each of these line items, little or big, has champions who want to preserve it in the budget. Look how squeamish the Democrats are about getting rid of so-called earmarks, the unvetted funding sought by individual members of Congress for pet projects. A profusion of earmarks in federal budgets during recent years of Republican control was one reason Democrats took back Congress in 2006. But Democrats seem incapable of taking that lesson to heart. Earlier this year they loaded up an omnibus spending bill with more than 9,000 earmarks, and Mr. Obama let them get away with it. Instead, he should have issued his first veto.

If Mr. Obama wants the public's support for some of his big-ticket proposals, he's going to have to deliver on his line-by-line pledge, getting rid of excessive spending and programs that don't work. And he's going to have to use the veto when the Democratic-led Congress spends like sailors out on the town.

Op-Ed Contributor
Bailout Justice
By JOHN ASHCROFT
May 5, 2009

Washington

I CAN imagine the Treasury secretary’s face turning pale as he is told by the attorney general that one of the financial institutions on government life support has been indicted by a grand jury. Worse, I can imagine the attorney general facing not too subtle pressure from the president’s economic team to go easy on such companies.

This situation is hypothetical, of course, but in March, the F.B.I. director, Robert Mueller, warned Congress that “the unprecedented level of financial resources committed by the federal government to combat the economic downturn will lead to an inevitable increase in economic crime and public corruption cases.” Yet no one has discussed the inherent conflict of interest that the government created when it infused large sums of money into these companies.

The government now has an extraordinarily high fiduciary duty to safeguard the stability and health of companies that received hundreds of billions of bailout money. At the same time, the Justice Department has the duty to indict a corporation if the evidence dictates such severe action — and an indictment is often a death sentence for a corporation. The quandary is obvious. How, then, does the Justice Department bring charges against a corporation that is now owned by the government?

The tsunami of corporate scandals that shook our economy in 2001 — Enron, WorldCom, Adelphia and others — provides us with an instructive example. The Justice Department moved swiftly to bring corporate wrongdoers to justice. But we also learned that when dealing with major companies or industries, we had to carefully consider the collateral consequences of our prosecutions.

Would there be unintended human carnage in the form of thousands of lost jobs? Would shareholders, some of whom had already suffered a great deal, lose more of their investment? What impact would our actions have on the economy? We realized that we had an obligation to minimize the harm to innocent citizens.

Among the options we pursued were deferred prosecution agreements. These court-authorized agreements were not new but under certain circumstances offered more appropriate methods of providing justice in the best interests of the public as well as a company’s employees and shareholders. They avoid the destructiveness of indictments and allow companies to remain in business while operating under the increased scrutiny of federally appointed monitors.

In September 2007, for instance, the Justice Department and the nation’s five largest manufacturers of prosthetic hips and knees reached agreements over allegations that they gave kickbacks to orthopedic surgeons who used a particular company’s artificial hip and knee reconstruction replacement products. The allegations meant that the companies faced indictment, prosecution and a potential end to their businesses.

Think of the effect on the community if these companies had been shuttered: employees would have lost their jobs, shareholders and pensioners would have lost their savings and countless people in need of hip and knee replacement would have been out of luck, as these five companies accounted for 95 percent of the market. The Justice Department could have wiped out an entire industry that has a vital role in American health care.

Instead, the companies paid settlements to the government totaling $311 million. They agreed to be monitored by private sector individuals and firms with reputations for integrity and public service, with the necessary legal and business expertise and the institutional capacity to do the job. The monitoring costs were borne exclusively by the companies, saving taxpayers tens of millions of dollars that could be then used for other investigations and law-enforcement priorities. (I was a paid monitor for one of these companies, Zimmer Holdings.) In these types of circumstances, a deferred prosecution agreement is clearly better for everyone.

The government must hold accountable any individuals who acted illegally in this financial meltdown, while preserving the viability of the companies that received bailout funds or stimulus money. Certainly, we should demand justice. But we must all remember that justice is a value, the adherence to which includes seeking the best outcome for the American people. In some cases it will be the punishing of bad actors. In other cases it may involve heavy corporate fines or operating under a carefully tailored agreement.

In 2001, we did not know the extent of the corporate fraud scandals. Every day seemed to bring news of another betrayal of trust by top executives of another company. But we learned that there was often a better solution than closing those companies. I believe that if we apply to this current crisis the lessons learned a few short years ago, we can achieve the restoration of trust in the financial system and the long-term vitality of the American economy.

Op-Ed Contributor
Inflation Nation
NYTIMES
By ALLAN H. MELTZER
May 4, 2009

Pittsburgh

IN the 1970s, with inflation rising, I often described the Federal Reserve as knowing only two speeds: too fast and too slow. At the time, the Fed’s idea was to combat recession by promoting expansion, printing money and making it easier for businesses and households to borrow — and worry only later about the inflation that resulted. That strategy produced a sorry decade of slow productivity growth, rising unemployment and, yes, rising inflation. If President Obama and the Fed continue down their current path, we could see a repeat of those dreadful inflationary years.

Back then, as now, the members of the Fed were well aware of the harmful effects of inflation. In private, they vowed not to let it get out of hand and several times even started to do something about it. But when their anti-inflationary moves caused the unemployment rate to rise to 6.5 percent or 7 percent, they forgot their promises and again began expanding the money supply and reducing interest rates.

By 1979, reported rates of inflation, worsened by the oil shock, had reached double digits. Opinion polls showed that the public now considered inflation to be the main economic problem. President Jimmy Carter’s choice for chairman of the Fed, Paul Volcker, said that he would fight inflation more deliberately than his predecessors. The president agreed with him, as did the chairmen of the Congressional banking committees.

With the public acceptance of the importance of low inflation, support in the administration and in Congress, and a chairman committed to the task, the Fed finally set out to correct what it had too long neglected. Instead of working only to avoid unemployment, the Fed sought to bring inflation back under control. Instead of flooding the market and banks with money, the Fed tightened its reserves. And instead of keeping interest rates in a narrow, relatively low range, Mr. Volcker let the market dictate the interest rate, allowing the prime rate to go as high as 21.5 percent. These disinflation policies continued in earnest with the 1980 election of Ronald Reagan.

Even so, the public, having already seen three or four failed attempts to tame inflation, didn’t really believe that Mr. Volcker and President Reagan would stay the course. In my reading of the evidence, a decisive change in attitudes occurred only in the spring of 1981, when the Federal Reserve raised interest rates even though the unemployment rate was approaching 8 percent. This was new. This was different. People began to expect lower inflation and, in this belief, slowed the increase in wages and prices, contributing to the decline in actual inflation.

Naturally, there were critics. But their criticisms were not strong enough to reverse policy. At the 1982 convention of the National Association of Home Builders, Paul Volcker said that if he were to let up on anti-inflation efforts prematurely, “the pain we have suffered would have been for naught — and we would only be putting off until some later time an even more painful day of reckoning.” As always in periods of high interest rates, home builders had been especially badly hurt, but when the chairman finished his speech, they gave him a standing ovation. Though they disliked his policy, they admired his determination to do what was needed.

The pain did not end. And the anti-inflation policy continued until the unemployment rate rose above 10 percent, many savings and loan institutions faced bankruptcy, and most Latin American countries defaulted on their debt. These were the unavoidable side effects of the public’s gradual adjustment to the new economic environment. This process continued until 1983, when the reported inflation rate fell below 4 percent.

Paul Volcker is now the head of President Obama’s Economic Recovery Advisory Board. Mr. Volcker and the administration’s many economic advisers are all fully aware of the inflationary dangers ahead. So is the current Fed chairman, Ben Bernanake. And yet the interest rate the Fed controls is nearly zero; and the enormous increase in bank reserves — caused by the Fed’s purchases of bonds and mortgages — will surely bring on severe inflation if allowed to remain. Still, they all reassure us that they can reduce reserves enough to prevent inflation and they are committed to doing so.

I do not doubt their knowledge or technical ability. What I doubt is the commitment of the administration and the autonomy of the Federal Reserve. Mr. Volcker was a very independent chairman. But under Mr. Bernanke, the Fed has sacrificed its independence and become the monetary arm of the Treasury: bailing out A.I.G., taking on illiquid securities from Bear Stearns and promising to provide as much as $700 billion of reserves to buy mortgages.

Independent central banks don’t do what this Fed has done. They leave such fiscal action to the legislative branch. By that same token, Mr. Volcker’s Fed had to avoid financing the large (for that time) Reagan budget deficits to be able to bring down inflation. The central bank was made independent expressly so that it could refuse to finance deficits. But is there a political consensus that the much larger Obama deficits will not pressure the Fed to expand reserves to buy Treasury bonds?

It doesn’t help that the administration’s stimulus program is an obstacle to sound policy. It will create jobs at the cost of an enormous increase in the government debt that has to be financed. And it does very little to increase productivity, which is the main engine of economic growth.

Indeed, big, heavily subsidized programs are rarely good for productivity. Better health care adds to the public’s sense of well-being, but it adds only a little to productivity. Subsidizing cleaner energy projects can produce jobs, but it doesn’t add much to national productivity. Meanwhile, higher carbon tax rates increase production costs and prices but do not increase productivity. All these actions can slow productive investment and the economy’s underlying growth rate, which, in turn, increases the inflation rate.

Some of my fellow economists, including many at the Fed, say that the big monetary goal is to avoid deflation. They point to the less than 1 percent decline in the consumer price index for the year ending in March as evidence that deflation is a threat. But this statistic is misleading: unstable food and energy prices may lower the price index for a few months, but deflation (or inflation) refers to the sustained rate of change of prices, not the price level. We should look instead at a less volatile price index, the gross domestic product deflator. In this year’s first quarter, it rose 2.9 percent — a sure sign of inflation.

Besides, no country facing enormous budget deficits, rapid growth in the money supply and the prospect of a sustained currency devaluation as we are has ever experienced deflation. These factors are harbingers of inflation.

When will it come? Surely not right away. But sooner or later, we will see the Fed, under pressure from Congress, the administration and business, try to prevent interest rates from increasing. The proponents of lower rates will point to the unemployment numbers and the slow recovery. That’s why the Fed must start to demonstrate the kind of courage and independence it has not recently shown.

Milton Friedman often said that “inflation was always and everywhere a monetary phenomenon.” The members of the Federal Reserve seem to dismiss this theory because they concentrate excessively on the near term and almost never discuss the medium- and long-term consequences of their actions. That’s a big error. They need to think past current political pressures and unemployment rates. For the next few years, they cannot neglect rising inflation.

Congress adopts budget plan endorsing Obama goals
DAY
By ANDREW TAYLOR, Associated Press Writer
Posted on Apr 29, 9:19 PM EDT

WASHINGTON (AP) -- Democrats in Congress capped President Barack Obama's 100th day in office by advancing a $3.4 trillion federal budget for next year - a third of it borrowed - that prevents Republicans from blocking his proposed trillion-dollar expansion of government-provided health care over the next decade.

Wednesday's House and Senate votes to adopt the nonbinding budget blueprint were only a first step toward Obama's goal of providing health care coverage for all Americans. The budget plan for the fiscal year that begins Oct. 1 sets the parameters for subsequent tax and spending bills expected to boost clean energy programs and student aid and extend many of former President George W. Bush's tax cuts.

"It's a budget that reduces taxes, lowers the deficit and creates jobs," House Speaker Nancy Pelosi, D-Calif., said. "It honors the three pillars of the Obama initiatives: energy, health care and education."

Obama cheered passage of the plan, saying in a statement that it "builds on the steps we've taken over the last 100 days to move this economy from recession to recovery and ultimately to prosperity."

The budget outline also makes it plain that Democrats won't let a mountain of deficits and debt interfere with advancing Obama's ambitious but costly agenda.

It gives Democrats the option of moving Obama's health care plan through Congress without the threat of a Republican filibuster, though Democrats promise to try to find bipartisan agreement.

The Senate adopted the plan by a 53-43 vote just hours after a 233-193 House tally.

Newly-turned Democrat Arlen Specter of Pennsylvania voted against the measure as he did earlier this month when it initially passed the Senate. Three other Democrats also voted no: Ben Nelson of Nebraska, Robert Byrd of West Virginia and Evan Bayh of Indiana.

Seventeen House Democrats, mostly from GOP-leaning districts, voted against the budget.

Not a single Republican in the House or Senate voted for the measure.

Obama inherited an economy in deep recession and a financial bailout costing hundreds of billions of dollars, and even some Republicans didn't fault him for deficits rocketing to $1.7 trillion for the ongoing budget year and a still-stunning $1.2 trillion in 2010.

"We inherited a colossal mess," Senate Budget Committee Chairman Kent Conrad, D-N.D., said.

As a result, Democrats opted against extending Obama's signature $400 tax cut for most workers beyond next year and cut $10 billion from his budget for non-defense programs. Also gone are revenues from Obama's "cap-and-trade" plan for curbing global warming by auctioning permits to emit greenhouse gases.

Republicans assaulted the plan as just the latest example of a spending spree by Democrats that started with Obama's $787 billion economic stimulus bill. It was followed by an omnibus appropriations bill that showered generous increases on domestic programs and included 8,000 pet projects for lawmakers' districts and states.

"It spends money we don't have, piles unprecedented debt on our children and grandchildren, and raises taxes on families and small businesses, while taking away the middle-class tax cut the president promised during the campaign," House Minority Leader John Boehner, R-Ohio, said.

Under the plan, the deficit would drop to $523 billion in 2014, but even that figure depends on several unrealistic assumptions, notably that Congress will devote only $50 billion a year for operations in Iraq and Afghanistan for 2011 and beyond, and unrealistic projections of costs for core Pentagon operations.

There's considerable accounting legerdemain in the plan as well, reflecting a struggle by Democrats to cut the budget deficit to 3 percent of the size of the economy within five years - a figure economists say is sustainable without adding crippling debt to the nation's books.

Rep. Paul Ryan, R-Wis., said a report Wednesday that the economy had shrunk by 6.1 percent in the first quarter highlighted the likelihood that the deficit numbers were even worse than predicted in the budget.

"Put reality into the budget and the deficits and debt go much higher," Ryan said.

House Democrats promise that completion of the budget will be followed by a pay-as-you-go law that would require - after some major exceptions for Bush-era tax cuts - that new tax cuts and increases in federal benefit programs like food stamps, unemployment insurance and Medicare are "paid for" with tax increases or offsetting spending cuts.

If the new pay-as-you-go law is violated, automatic spending cuts would be imposed to bring the deficit back into line.

Also permitted to advance under filibuster-free rules is Obama's plan to eliminate student loan subsidies for banks and other lenders, with the savings being used to increase Pell Grants for needy students.

The budget plan skirts difficult decisions on how to pay for Obama's health care plan, which is expected to cost more than $1 trillion over the next decade. It allows the new president's signature $400 tax credit for most workers to expire in 20 months but devotes $512 billion over five years to extend tax cuts passed during Bush's first term for middle-class workers, investors and families with children.

The End of the World as We Know It - Welcome to the “post-American era.”
National Review
By Mark Steyn
April 25, 2009, 7:00 a.m.

According to an Earth Day survey, one third of schoolchildren between the ages of six and eleven think the earth will have been destroyed by the time they grow up. That’s great news, isn’t it? Not for the earth, I mean, but for “environmental awareness.” Congratulations to Al Gore, the Sierra Club, and the eco-propagandists of the public-education system in doing such a terrific job of traumatizing America’s moppets. Traditionally, most of the folks you see wandering the streets proclaiming the end of the world is nigh tend to be getting up there in years. It’s quite something to have persuaded millions of first-graders that their best days are behind them.

Call me crazy, but I’ll bet that in 15-20 years the planet will still be here along with most of the “environment” — your flora and fauna, your polar bears and three-toed tree sloths and whatnot. But geopolitically we’re in for a hell of a ride, and the world we end up with is unlikely to be as congenial as most Americans have gotten used to.

For example, Hillary Clinton said the other day that Pakistan posed a “mortal threat” to . . . Afghanistan? India? No, to the entire world! To listen to her, you’d think Pakistan was as scary as l’il Jimmy in the second grade’s mom’s SUV. She has a point: Asif Ali Zardari, the guy who’s nominally running the country, isn’t running anything. He’s ceding more and more turf to the local branch office of the Taliban. When the topic turns up in the news, we usually get vague references to the pro-Osama crowd controlling much of the “northwest,” which makes it sound as if these guys are the wilds of rural Idaho to Zardari’s Beltway. In fact, they’re now within some 60 miles of the capital, Islamabad — or, in American terms, a couple of I-95 exits north of Baltimore: In other words, they’re within striking distance of the administrative center of a nation of over 165 million people — and its nuclear weapons. That’s the “mortal threat.”

What’s going to stop them? Well, not Zardari. Nor his “summit” in Washington with President Obama and Hamid Karzai of Afghanistan. The creation of Pakistan was the worst mistake of post-war British imperial policy, and all that’s happened in the six decades since is that its pathologies have burst free of its borders and gone regional, global, and soon perhaps nuclear. Does the Obama administration have even a limited contingency plan for the nukes if — when — the Pakistani state collapses?

It would be reassuring to think so. But I wonder.

What’s the greater likelihood? That, in ten years’ time, things in Pakistan will be better? Or much worse? That nuclearization by basket-case dictatorships from Pyongyang to Tehran will have advanced, or been contained? That the bleak demographic arithmetic at the heart of Europe and Japan’s economic woes will have accelerated, or been reversed? That a resurgent Islam’s assaults on free speech and other rights (symbolized by the recent U.N. support for a global Islamic blasphemy law) will have taken hold in the western world, or been forced to retreat?

A betting man would check the “worse” box. Because resisting the present careless drift would require global leadership. And 100 days into a new presidency, Barack Obama is giving strong signals to the world that we have entered what Caroline Glick of the Jerusalem Post calls “the post-American era.” At the time of Gordon Brown’s visit to Washington, London took umbrage at an Obama official’s off-the-record sneer to a Fleet Street reporter that “there’s nothing special about Britain. You’re just the same as the other 190 countries in the world. You shouldn’t expect special treatment.” Andy McCarthy of National Review made the sharp observation that, never mind the British, this was how the administration felt about their own country, too: America is just the same as the other 190 countries in the world. In Europe, the president was asked if he believed in “American exceptionalism,” and replied: “I believe in American exceptionalism, just as I suspect that the Brits believe in British exceptionalism and the Greeks believe in Greek exceptionalism.”

Gee, thanks. A simple “no” would have sufficed. The president of the United States is telling us that American exceptionalism is no more than national chauvinism, a bit of flag-waving, of no more import than the Slovenes supporting the Slovene soccer team and the Papuans the Papuan soccer team. This means something. The world has had two millennia to learn to live without “Greek exceptionalism.” It’s having to get used to post-exceptional America rather more hurriedly.

It makes sense from Obama’s point of view: On the domestic scene, he’s determined on a transformational presidency, one that will remake the American people’s relationship to their national government (“federal” doesn’t seem the quite the word anymore) in terms of health care, education, eco-totalitarianism, state control of the economy, and much else. With a domestic agenda as bulked up as that, the rest of the world just gets in the way.

You’ll recall that, in a gimmick entirely emblematic of post-exceptional America, Hillary Clinton gave the Russians a (mistranslated) “Reset” button. The button has certainly been “reset” — to September 10th, to a legalistic rearview mirror approach to the “War on Terror,” in which investigating Bush officials will consume far more time and effort than de-nuking Iran. The secretary of Homeland Security’s ludicrous re-classification of terrorism as “man-caused disaster,” and her boneheaded statement that the September 11th bombers had entered America from Canada (which would presumably make 9/11 a “Canadian man-caused disaster”) exemplifies the administration’s cheery indifference to all that Bush-era downer stuff.

But it’s not September 10th. In Pakistan, a great jewel is within the barbarians’ reach, the first of many. At the U.N., the Islamic bloc’s proscriptions on free speech will make it harder even to talk about these issues. In much of the West, demographic decay means the good times are never coming back: Recession is permanent.

Hey, what’s the big deal? Britain and France have been on the geopolitical downward slope for most of the last century and life still seems pretty agreeable. Well, yes. But that’s in part because, when a fading Britannia handed the baton to the new U.S. superpower, it was one of the least disruptive transfers of global dominance in human history. In the “post-American era,” to whom does the baton get passed now?

Since January, President Obama and his team have schmoozed, ineffectively, American enemies over allies in almost every corner of the globe. If you’re, say, India, following Obama’s apology tour even as you watch the Taliban advancing on those Pakistani nukes, would you want to bet the future on American resolve? In Delhi, in Tokyo, in Prague, in Tel Aviv, in Bogota, they’ve looked at these first 100 days and drawn their own conclusions.

Op-Ed Columnist
Big-Spending Conservative
By DAVID BROOKS
April 21, 2009

We’ve all heard liberal speeches on the economy. The central concern is inequality. Power and wealth tend to concentrate at the top of society, so government must stand as a countervailing power. It must defend the people against the powerful to ensure fairness and opportunity for all.

It is interesting, therefore, that when President Obama summarized his economic policies in a speech at Georgetown last week, he departed from this story line and worldview. Obama’s chief concern was not inequality. It was irresponsibility. Obama didn’t sound like an economic liberal at Georgetown. He sounded like a cultural conservative.

America once had a responsible economic culture, Obama argued. People used to save their pennies to buy their dream houses. Banks used to lend by “traditional standards.” Fannie Mae and Freddie Mac used to stick to their “traditional mandate.” Companies like A.I.G. used to limit themselves to the “traditional insurance business.”

But these traditions broke down, Obama continued. They were swamped by irresponsibility. Businesspeople chased “short-term profits” over long-term investments. Smart people spent more time manipulating numbers and symbols than actually making things. Americans consumed too much and saved too little. America became corrupted by “excessive debt,” “reckless speculation” and “fleeting profits.”

Obama vowed to end this irresponsibility and the cycle of boom and bust. It’s time to get back to basics, he said. He embraced tradition, order and authority. He quoted the New Testament and argued that it is time that the U.S. built its economic house on rock and not sand.

If Republicans aren’t nervous, they should be. Obama is arguing for his activist agenda not on the basis of class-consciousness, which is alien to America, but as a defense of middle-class morality, which is central to it. Obama is positioning the Democrats as the party of order, responsibility and small-town values. If he pulls this mantle away from the Republicans, it would be the greatest train robbery in American politics.

Obama then went on to describe his remedy in the soothing, understated manner of a country doctor prescribing a few small procedures. The country has been on an irresponsible bender, so his administration will have to “clear away” a few toxic assets, “reassess” the viability of Chrysler and General Motors, and “create rules that punish shortcuts” on Wall Street.

His view was clear. The market is dynamic and important, but it makes people reckless, parochial and dangerously shortsighted. The market needs adult supervision — a leadership class made up of people who appreciate the market but who also have committed themselves to public service, and who therefore take the long view and are more conscious of the public good.

Obama is building this new leadership class. His administration has become a domestic I.M.F., consisting of teams of experts who can swoop in and provide long-term solutions when systems — finance, housing, health care, education, autos — have broken down.

When the members of this new establishment are confronted with a broken system — whether it involves hospitals, energy, air pollution or cars — their approach is the same. They aim to restructure incentives in order to channel the animal drives of the marketplace in responsible directions.

Obama is taking enormous risks. Even F.D.R. decided to concentrate on the banking crisis in his first year and put other issues off until 1934 and beyond. Obama is doing everything at once. And yet in this speech, and in his heart, his approach seems self-evident, reassuring and almost mundane. As explication, the Georgetown speech was a small masterpiece.

The first danger for the Obama administration, of course, is that his teams of experts may not be as farsighted as they believe. It may not be so easy to out-think the market. His advisers are like jugglers who have thrown knives in the air. It’ll get harder when they start coming down.

Moreover, for an administration that puts responsibility at the center, it is not itself very responsible. Federal spending is the leverage the administration uses to gain control over sector after sector, and yet this money is all borrowed.

Obama imposes hard choices on others, but has postponed his own. He presented an agenda that bleeds red ink a trillion dollars at a time. Now he seems passive as Congress kills his few revenue ideas (cap and trade) and spending cuts (agricultural subsidies). Huge fiscal gaps are opening this decade that can’t be closed by distant entitlement reform. They can’t be closed by cynical Potemkin cuts, a few million at a time.

This is not a matter of economics only, but credibility. Obama understands that this is primarily an authority crisis. A system Americans have trusted — the market — has failed in important ways. He has found a theme and bids to reassert authority. But he will seem like an impostor and a manipulator if he imposes responsibility on everybody but himself.

"On a bright, sunny, safe day in April 2009."
Are we still at war?
by William Kristol
04/17/2009 12:00:00 AM

It wasn't really a surprise that President Obama sided with leftist lawyers in his Justice Department and released, over the objections of the intelligence community, four Office of Legal Counsel memos that concluded certain interrogation techniques used in the last several years by CIA officers on certain al Qaeda terrorists were legal. Nor was it a surprise that the presidential statement put out by the White House was a medley of preening self-righteousness and defensive disingenuousness.

What was more interesting was the accompanying statement by the Director of National Intelligence, Dennis Blair, trying to justify Obama's decision--or at least put it "into perspective." The perspective, the context, is that in the months after 9/11, "we did not have a clear understanding of the enemy we were dealing with, and our every effort was focused on preventing further attacks that would kill more Americans. It was during these months that the CIA was struggling to obtain critical information from captured al Qaida leaders, and requested permission to use harsher interrogation methods. The OLC memos make clear that senior legal officials judged the harsher methods to be legal."

Blair continues: "Those methods, read on a bright, sunny, safe day in April 2009, appear graphic and disturbing. As the President has made clear, and as both CIA Director Panetta and I have stated, we will not use those techniques in the future. But we will absolutely defend those who relied on these memos and those guidelines."

So: We were once in danger. Now we live in "a bright, sunny, safe day in April 2009." Now, in April 2009, Obama's Director of National Intelligence seems to be saying, we're safe.

Good news, if true. And it would be an amazing tribute to the preceding administration's efforts in the war on terror--efforts that Democrats have been saying for years were making us less safe. Apparently, the old policies worked. The threat from al Qaeda has gone. We now have the luxury of "reflection," as President Obama put it in his statement, the luxury of debating and deploring what we did back in the bad old days when there was a war on. After all, "we have been through a dark and painful chapter in our history."

Leave aside how dark and painful the chapter really was. The question is, Is it over? Is the chapter in which we had to focus on preventing further attacks really through? Isn't there still a war against the jihadists on?

Of course Blair and other senior Obama officials have elsewhere suggested that the terror threat remains real, and even urgent. Why else the maintenance of the Bush era surveillance program? Why else the decision to send more troops to Afghanistan, and to deploy more Predator strikes into Pakistan?

But can we then afford Obama's "dark and painful chapter" attitude, exemplified by his foregoing certain interrogation techniques in the present and future, and his exposing and deploring what was done in the past? Can we afford an intelligence director who tries to excuse his boss by telling us we are now safe?

Are we at war or not?

William Kristol is editor of THE WEEKLY STANDARD.

Who ever said that a cartoon didn't make waves?
At Summit, NATO Is Divided Over Chief
By REUTERS
Filed at 2:33 p.m. ET
April 4, 2009

STRASBOURG, France (Reuters) - NATO named Danish Prime Minister Anders Fogh Rasmussen as its next leader on Saturday, averting a damaging split with Turkey at a 60th anniversary summit marred by rioting protesters.

U.S. President Barack Obama prodded European allies to do more in Afghanistan, but received pledges for only 5,000 extra troops, the majority of whom will go on a temporary basis to provide security during August elections.

The meeting of the 28-nation military alliance, created after World War Two to defend Europe's borders, exposed transatlantic divisions despite a new U.S. strategy for Afghanistan that Obama's European allies broadly welcomed.

The summit was also plagued by unusually destructive protests, with masked youths burning down a seven-storey hotel and riot police unleashing volleys of teargas and shock grenades to try to contain the violence.

Obama was cheered by crowds waving American flags when he arrived in France on Friday with his wife Michelle, offering the prospect of a new era of cooperation with Europe following the strains under his predecessor, George W. Bush.

"The United States came here to listen, to learn and to lead, because all of us have a responsibility to do our part," Obama told reporters at the end of the two-day summit.

"America cannot meet our global challenges alone. Nor can Europe meet them without America."

Obama then flew to Prague for a U.S.-European Union summit on Sunday and will go on to Turkey, the last stop on a tour that started at the G20 economic summit in London. In Strasbourg, as in London, Obama played a big role in securing a compromise deal but did not win major concessions from allies.

DANE PREVAILS

Obama played a key role in brokering a deal with Turkey on the North Atlantic Treaty Organisation's next leader. Ankara had opposed Rasmussen's bid because of his handling of a 2006 crisis over cartoons of the Prophet Mohammad in a Danish newspaper.

When Turkey threatened to torpedo his candidacy, U.S. officials said Obama pulled Rasmussen and Turkish President Abdullah Gul together, helping avert a damaging row that could have derailed the summit and hurt all three leaders.

Gul later told reporters that Rasmussen, who will travel to Istanbul next week, had pledged to make an "extraordinary effort" to overcome concerns over his image. It also received assurances one of Rasmussen's deputies would be a Turk.

"I made it clear I will reach out to the Muslim world and I will make sure we will cooperate closely with Turkey," said Rasmussen, who will take over from Dutchman Jaap de Hoop Scheffer on August 1.

NATO members came to the summit in the French city of Strasbourg and nearby German towns of Kehl and Baden-Baden hoping to forge a new strategic vision for the alliance.

NATO accepted France back into its military command after four decades, and welcomed Albania and Croatia as members.

The group has expanded to 28 nations despite the demise of its first foe, the Soviet Union, but is struggling in Afghanistan, seven years after U.S.-backed forces toppled the Taliban following the September 11 attacks on the United States.

NATO members agreed at the summit to send 5,000 additional troops and trainers, including 3,000 soldiers that will help provide security during Afghan elections in August.

But the pledges are unlikely to silence critics who say the war is becoming increasingly "Americanized."

The United States has 38,000 troops in Afghanistan, more than all the other national contingents put together. Obama has said he will add an extra 17,000 combat troops as well as 4,000 others to help train Afghan officials.

His new strategy also focuses on rooting out insurgents across the border in Pakistan and he said on Saturday additional aid for that country would depend on how Islamabad tackled the threat of terrorism.

Masked youths hurled petrol bombs, smashed windows and ransacked shops, temporarily forcing police into retreat in Strasbourg. German police crossed the short distance into neighboring France to help put out fires, which gutted a row of low storey buildings and ravaged an IBIS hotel.

The worst of the violence was centered close to the French side of the Bridge of Europe, just 5 km (3 miles) from the conference center where the leaders met. A pall of black smoke was clearly visible from the summit venue.

Op-Ed Columinst
America Agonistes
By ROGER COHEN
April 2, 2009

LONDON — Pax Americana, unlovely but effective, has endured for more than 60 years, the consequence of the post-war development of the United States as a European and Asian power. It has averted the worst, but it is safe to say that it is closer to the end than the beginning of its life.

I say this with no enthusiasm. As a beneficiary of America’s far-flung garrisons, and a member of a generation blessed (as the Germans say) with late birth, I have few illusions about what greater disasters might have befallen Europe and Asia without the offsetting presence of U.S. power.

But, as General Motors has discovered, history moves on.

G.M., in fact, is not a bad emblem for this moment when the world’s tectonic plates are plainly on the move. No corporation ever symbolized American might with greater vividness. It topped the first “Fortune 500” list in 1955, the year I was born, and was in the top three by revenue every year until 2007. Now it is all but bankrupt.

There are many reasons for this debacle, including GM’s failure to adapt to the shift to a low-carbon economy, the general decline of manufacturing in the United States, and global competition. G.M. lost out as America changed. Emma Rothschild noted recently in The New York Review of Books that U.S. consumers spent less on new cars in 2007 than on brokerage fees and investment counseling!

Where that debt-driven American investment binge led is now clear: to financial meltdown, tens of millions of lost jobs and a global hunt for fat-cat scapegoats paying themselves bonuses for failure. Anglo-American capitalism is on trial, the Thatcher and Reagan revolutions exhausted.

From this wreckage, this ending, the Group of 20 must trace the contours of a 21st century global economy. The task embarked on here in London will be long. As it happens, it has begun in the same week as NATO leaders meet in France and Germany to mark the Atlantic Alliance’s 60th birthday. These gatherings — of an old and a new organization — both mark America’s changing place in the world.

At the G-20, the power of free markets — the American mantra of recent decades — is in retreat before state intervention, led in many respects by a chastened United States itself that has discovered some merit in the oft-mocked European model.

More fundamentally, it is clear that the answers do not lie in Washington, where consensus has long been sought, but increasingly in new centers of economic power and new forms of global cooperation. The G-20 itself — with the presence of the likes of China, Brazil, India and South Africa — reflects this reality.

China’s demand for greater power within the International Monetary Fund, its provocative questioning of the dollar as the world’s reserve currency, and the ultimate dependence of a debtor nation like the United States on changed behavior from the mega-surplus powers of China, Germany and Japan are all indicators of American vulnerability.

Such vulnerability is not confined to the economic sphere. Its treasure depleted, its dominance eroded, its standing questioned, America cannot forever bankroll the security of the world.

That will be a reality of the 21st century, not perhaps its first couple of decades, but increasingly over time. The NATO summit, however celebratory in towns that symbolize Europe’s American-assisted overcoming of its collective suicide, must begin to grapple with this inevitability.

For beyond the troubled Afghan mission, itself an eloquent expression of NATO’s ongoing transformation, and beyond the critical question of the alliance’s relations with Russia, lies a still more fundamental issue: what exactly is a post-cold-war NATO for and how will American power be projected within it?

In pondering this, I’m struck by a defining event of this summit: the return of France to the integrated military command of NATO. Poor de Gaulle; he must be turning in his grave. But give President Nicolas Sarkozy credit where it’s due: there was no point in prolonging the quixotic Gallic pursuit of “counterweight” status to the United States when U.S. power itself was dwindling. Why counter an eroding weight?

One result of Sarkozy’s volte-face is that a French general will preside in Virginia over the Allied Command Transformation project, devoted to blue-sky re-imaginings of the alliance. I like the idea of a Frenchman in the United States rethinking the world: friction stimulates.

My own view, based in the conviction that Pax Americana cannot endure another 60 years in its current form, is that a NATO now tacitly or explicitly working for the defense and expansion of the liberal democratic order — a task with no obvious geographical limit — must in time evolve into an alliance of democracies in which the likes of Japan, India and Australia would logically take their place.

One of Barack Obama’s central strategic tasks is to forge a more balanced world order that will advance American interests, political and economic, even at the price of diminished American pre-eminence. Fortunately this most cosmopolitan of U.S. presidents is well suited to the task. A guiding intelligence has replaced a guiding anger at the White House.

OBAMA'S WORST JOBS-KILLER
NYPOST
By DICK MORRIS & EILEEN MCGANN
April 1, 2009 --

MORE than anything else, business needs a predictable environment if it is to create jobs. Changes in the regulatory environment and the tax code make it almost impossible for businesses to make investments.

Yet President Obama seems to ignore this reality. Each day's news brings another bold and far-reaching proposal to change the fundamentals of the US economy. And each time he indulges his personal ideology with such a pronouncement, businesses all over the world cut back on their planned investment until the dust settles.

Most incredible was the fact that he chose the middle of a deep recession to announce a major tax-code overhaul.

Stressing how far-reaching the changes might be, he appointed a commission headed by former Federal Reserve Chairman Paul Volcker to report back by early December on what the changes should be.

Assuming Obama will need several months to figure out which of its recommendations to adopt and Congress will take several more months to enact its own version, the announcement effectively leaves business up in the air for at least 12 more months -- uncertain of the tax consequences of any potential investment.

Who in their right mind is going to invest significantly in new plant, equipment, services, personnel or anything else? How can you consider doing so, when you can't know how the tax code might penalize you?

And, in the same week, Obama announced that he'd seek to regulate nonbank institutions, including those he deems to be "too big to fail" lest their collapse injure the economy. Which businesses will be included? Nobody knows.

We may not know even when the law is passed. As companies grow or merge or acquire one another, they may step over the invisible line and become "too big," and thus subject to Obama's regulation.

How can a firm plan on expansion without knowing what increment in its size will attract regulatory scrutiny? It's hard enough to anticipate possible anti-trust complications -- and the Justice Department is at least usually willing to consult before any merger on what its attitude will be. Obama's leaving everybody guessing.

Growth demands investment, and investment demands stability. So the more Obama stirs the pot with his proposals and potential changes, the more he retards exactly the investment he needs to get the economy moving again.

At least Obama has toned down his rhetoric, no longer echoing JFK's comment that "all businessmen are SOBs." But his actions do more than his words ever did to hobble any recovery.

So why insist on pushing these "reforms" now? Because, while it might be wiser to wait until after the economy's out of recession, it may then become politically impossible to get them through Congress.

So he's determined to use the sense of panic to enact his changes now.

Again, he's putting his ideological agenda ahead of the requisites of national economic recovery. We needed a pragmatic pilot; we elected an ideologue instead.

Op-Ed Columnist: Car Dealer in Chief
NYTIMES
By DAVID BROOKS
March 31, 2009

Some companies are in the steel business, some are in the cookie business, but General Motors is in the restructuring business. For 30 years, G.M. has been restructuring itself toward long-term viability.

For all these years, G.M.’s market share has endured a long, steady slide. But this has not stopped the waves of restructuring. The PowerPoints have flowed, and always there has been the promise that with just one more cost-cutting push, sustainability nirvana will be at hand.

There are many experts who think that the whole restructuring strategy is misbegotten. These experts think that costs are not the real problem. The real problem is the product. The cars are not good enough. The management is insular. The reputation is fatally damaged.

But if you are in the restructuring business, you can’t let these stray thoughts get in the way of your restructuring. After all, restructuring is your life. Restructuring is forever. Restructuring is like what dieting is for many of us: You think about it every day. You believe it’s about to work. Nothing really changes.

When the economy cratered last fall, the professionals at G.M. went into Super-Duper Restructuring Overdrive. In October, they warned the Bush administration of a possible bankruptcy filing and started restructuring. In December, they came back asking for a loan while they ... (wait for it) ... restructured.

The Bush advisers decided in December that bankruptcy without preparation would be a disaster. They decided what all administrations decide — that the best time for a bankruptcy filing is a few months from now, and it always will be. In the meantime, restructuring would continue, federally subsidized.

Today, G.M. and Chrysler have once again come up with restructuring plans. By an amazing coincidence, the plans are again insufficient. In an extremely precedented move, the Obama administration has decided that the best time for possible bankruptcy is — a few months from now. The restructuring will continue.

But this, President Obama declares, is G.M.’s last chance. Honestly. Really.

No kidding.

Could this really be true? Could the Harvard Business Review’s longest-running soap opera possibly be coming to an end? Could President Obama really scare the restructural recidivists in Detroit into coming up with changes big enough to do the job?

Well, the president certainly acted tough on Monday. In a show of force, he released plans from his Office of People Who Are Much Smarter Than You Are. These plans insert the government into the car business in all sorts of ways. They pick winners (new C.E.O. Fritz Henderson) and losers (Rick Wagoner). They basically send Chrysler off into the sunset. Joe Biden will be doing car commercials within weeks.

The Obama team also raised the bankruptcy specter more explicitly than ever before. Even more tellingly, the administration moved to “stand behind” the companies’ service warranties. That lays the groundwork for a bankruptcy procedure and should be a sharp shock to Detroit.

And yet by enmeshing the White House so deeply into G.M., Obama has increased the odds that March’s menacing threat will lead to June’s wobbly wiggle-out. The Obama administration and the Democratic Party are now completely implicated in the coming G.M. wreck. Over the next few months, the White House will be subject to a gigantic lobbying barrage. The Midwestern delegations, swing states all, will pull out all the stops to prevent plant foreclosures. Unions will be furious if the Obama-run company rips up the union contract. Is the White House ready for the headline “Obama to Middle America: Drop Dead”? It would take a party with a political death wish to see this through.

Furthermore, there’s no reason to think the umpteenth restructuring will produce compelling results. Cost control without a quality revolution will make little difference. There’s no reason to think Americans are going to flock to G.M. cars. (The president lauded their fantabulousness, but G.M. sales fell 51 percent during the first two months of this year while the overall market declined by 39 percent.) Politically expedient environmental demands will make the odds of profitability even more remote.

Corporate welfare rarely works when the government invests in rising firms. The odds are really grim when it tries to subsidize fading ones. (In the ’80s, Chrysler already had the successful K-car in the pipeline.)

The most likely outcome, sad to say, is some semiserious restructuring plan, with or without court involvement, to be followed by long-term government intervention and backdoor subsidies forever. That will amount to the world’s most expensive jobs program. It will preserve the overcapacity in the market, create zombie companies and thus hurt Ford. It will raise the protectionist threat as politicians seek to protect the car companies they now run.

It would have been better to keep a distance from G.M. and prepare the region for a structured bankruptcy process. Instead, Obama leapt in. His intentions were good, but getting out with honor will require a ruthless tenacity that is beyond any living politician.

Editorial: Grand Bargain
NYTIMES
March 26, 2009

You think the world’s economic outlook is grim? Consider this possibility: Europe rejects the United States’ call for more fiscal stimulus and resists further monetary easing, and Congress further tightens import restrictions to ensure the economic rescue package only creates jobs at home and doesn’t leak to other countries.

Rich nations that have spent hundreds of billions of dollars bailing out their banks instruct them to focus on lending at home. Developing countries are cut off from international finance. Most devalue; many default. Trying to export their way out, they engage in competitive devaluations yet run up against new import barriers in the West. It would be wrong to shrug off this scenario. Of course, every world leader knows that beggar-thy-neighbor strategies are likely to make the current global emergency worse. Still, protectionism thrives in economic crises as people seek scapegoats abroad for their troubles and demand protection for domestic jobs.

At their summit in Washington last November, leaders of the Group of 20 biggest economies underscored “the critical importance of rejecting protectionism.” A tally by the World Bank found that 17 of the countries have imposed some kind of protectionist policy — from tariffs to tax rebates to export subsidies — since then.

Leaders gathering for another G-20 summit next week in London must not only commit to avoid this path, they must flesh out their commitment with concrete proposals for concerted actions. The world needs a bargain that commits us all to seek collective solutions. The meeting could easily snag on intractable differences. The International Monetary Fund forecasts that countries in the euro zone will suffer a deeper recession than the United States. Still, this seems less of a worry to Europe than potential long-term budget deficits and currency weakness. The countries have not only refused the American call to spend more to dig out, but the Czech prime minister, representing the European Union, called the American plan the “way to hell.”

But there are some areas of accord that could be built on — including support by Japan, the European Union and the United States to increase the resources available to the I.M.F. to at least $500 billion. The I.M.F. also has revamped aid programs to loosen some conditions and speed up payment to countries in need.

More needs to be done to help poorer nations. The World Bank has asked industrial countries to commit 0.7 percent of their stimulus financing toward aid. They could also back a new issue of special drawing rights — the I.M.F.’s currency that can be used to help nations in need — and welcome a bigger role in the fund for China, which could use some of its vast resources to help. It is important that they lean on their banks — perhaps provide guarantees — to encourage them not to pull out of the developing world.

These efforts would help avert catastrophe in the poor world — which would inevitably come back to bite the richer nations — and would establish a sense of collective responsibility. This is vital. Whether countries agree today on specific ideas for economic stimulus and financial rescue, this crisis is not over. Part of the task ahead will be to monitor the evolution of the economic emergency and the effectiveness of rescue plans.

This month, the I.M.F. forecasted that the world economy would contract between 0.5 percent and 1 percent this year, which would be the worst performance since World War II. But each new forecast brings worse news. Rescue plans may well need to be intensified. If reality turns out worse than expected, it would be best if the world’s leading countries were still talking and could agree to do something about it.

Op-Ed Columnist
Everything Bad Is Good Again
NYTIMES
By GAIL COLLINS
March 26, 2009

National Consensus Update:

Tim Geithner — Really cool guy. Super job on that bank bailout thing. Look at the way the stock market jumped. Way better Treasury secretary than last week’s Tim Geithner, who seemed a lot ... shorter.

Barack Obama — Kinda boring. Did you see the news conference? Same thing over and over again. Not that we mind. In these troubled times, we like stability. Thank God we didn’t elect somebody who was all charisma and exciting speeches.

Eliot Spitzer — He was the only one who got it, really got it, about A.I.G. before the big collapse. Great New York attorney general. What ever happened to him?

TALF (Term Asset-Backed Securities Loan Facility) — This is the thing Tim Geithner is doing, and, you know, whatever Tim wants ... We like TALF much, much better than TARP, which was the brainchild of former Treasury Secretary Hank Paulson, who had that dumb idea about buying up all the bank’s toxic assets. Which is what Tim is going to do, except it’s going to be way cooler.

Financial industry — We still hate Wall Street. Although when it sends the stock market up, it makes us like Tim Geithner even more.

In summary, there appears to be only two constants in our ever-changing world. One is that Barack Obama is going to be on television every day forever. No venue is too strange. Soon, he’ll be on “Dancing With the Stars” (“And now, doing the Health Care, Energy and Education tango ...”) or delivering the weather report. (“Here we see a wave of systemic change, moving across the nation ...”)

The other immutable truth is that we always need to have somebody we can be really, really angry at. The A.I.G. bonus-takers have pretty much worn out their 15 minutes. In an Op-Ed article in The Times on Wednesday, Jake DeSantis, one of the executive vice presidents of the company’s dreaded financial-products unit, offered up his side of the story about how even though he had never met a credit default swap in his life, he had promised to stay around to help clean up the mess for $1 a year and a bonus at the end of the tunnel. And then, suddenly, there was the head of the company throwing him to the wolves, or at least to the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises.

It reminded me of a time when I was in college and got a summer temp job at the purchasing department of a widget factory in Brooklyn. The office manager, who stayed hidden away in his office, had given all the power to one assistant manager, the golden Colin from England, while Colin’s two co-workers, Bernie and Frank, had nothing to do but sit around grinding their teeth.

Colin was on vacation when I arrived, and as time went on, it became increasingly clear that he was never coming back. The manager stayed in his office — and in denial. The factory started running out of everything, including toilet paper. I invented a new filing system in which all incoming letters and phone messages were divided by the number of times the petitioner had previously attempted to contact Colin. It was a big hit.

The next time I came through Brooklyn, the widget factory was gone. But suppose that instead of a small manufacturing firm, it had been an international insurance giant and Colin was selling complicated financial products based on risky mortgages? Trust me, Bernie and Frank would have expected to be paid really big bucks for cleaning up after him.

The country needs a new, improved villain. This is not a problem in New York, since we have a state government so awful that we barely noticed this week when prosecutors revealed that the state pension fund scandal is intertwined with a deal to sell DVDs of a movie called “Chooch.” The governor is terrible, and the Legislature is terrible and — we need Eliot Spitzer! Whatever happened to him, anyway?

In Congress, the person currently giving the Obama administration heartburn is Senator Kent Conrad of North Dakota, the chairman of the Budget Committee. But this is a guy whose biggest claim to fame is that when making a budget speech, he uses so many charts that the Senate gave him his own printing equipment. I am not seeing a great target for pitchfork-waving.

Something will turn up. If Tim (Great Guy!) Geithner’s bank bailout plan works, it will mean quadrillions of dollars in profits for hedge fund managers who are already billionaires, and I can absolutely guarantee you that we are not going to be pleased. Then we can turn on him again. And Eliot Spitzer can become the next secretary of the Treasury.

The Outrage Kabuki: And the limits of telepromptered cool.
National Review
By Mark Steyn
March 21, 2009, 7:00 a.m.

Are you outraged by these AIG bonuses?

No, no. For Pete’s sake, you’re an A-list congressional bigshot. Try to get a bit of feeling into “outraged.” The president’s teleprompter puts it in italics, bold, capitalized, and underlined: OUTRAGED!

That’s better. Don’t forget to furrow your brow and fume. No, not like a camp waiter when you send back the arugula salad drizzled in an aubergine coulis. We’re looking for primal, righteous anger: You’re outraged, OUTRAGED that bonuses are being handed out at companies the American taxpayer is bailing out. Yes, to be sure, the bonuses were specifically provided for in the legislation, but, like all busy senators and congressmen, you don’t have time to read every footling trillion-dollar bill before you vote in favor of it. And yes, true, the specific passage addressing these particular bonuses was, in fact, added to the bill in your name, but that was nothing to do with you — you just did that because the White House asked you to, and just because their people called your people and some intern in your office drafted some boilerplate with your name on it is no reason for you to be denied ten minutes of grandstanding on MSNBC. It’s an outrage to suggest you’re anything other than outrageously outraged!

To his credit, the Hopeychanger-in-Chief has had some difficulty doing the outrage kabuki with a straight face. In the middle of his press conference the other day, he got a tickle in his throat and departed from his telepromptered script to joke: “Excuse me, I’m choked up with anger here.” How the assembled hacks laughed! Why, it was almost as funny as his gag on The Tonight Show. Referring to his 129 score at the White House bowling alley, the president cracked that “it was like the Special Olympics.” Ha-ha! What a card that Obama is when he unplugs the prompter and kicks loose a little. Maybe next time he can toss in that the Dow Jones has got “Down” syndrome — geddit? Oh, come on! Don’t be so uptight and politically correct!!! And besides, anyone who says the president shouldn’t be doing crip jokes is a racist.

Frank James of the Chicago Tribune criticized the president’s bon mot more in sorrow than in anger: “Obama seems to be a fairly sensitive and compassionate man who wouldn’t purposely set out to offend the disabled . . . ”

Are you sure about that? He might be “a fairly sensitive and compassionate man.” Alternatively, he could be a mean, self-absorbed s.o.b. who regards anyone other than himself as intellectually disabled. The truth is we don’t know, because in the course of the presidential campaign the press declined to do even the most elementary due diligence on him. And, like Congress with the stimulus, the electorate didn’t bother to find out what’s in there before they voted for it.

Still, on the basis of its first 60 days, this is a very odd presidency. In between appearances on Jay Leno and his “March Madness” picks, Barack Oprompta also found time to compare AIG executives to suicide bombers:

Even though it makes you angry because you’re thinking I was responsible, and these folks are irresponsible, and somehow I’m paying for them, it was the right thing to do to step in. The same is true with AIG. It was the right thing to do to step in. Here is the problem. It’s almost like they’ve got, they’ve got a bomb strapped to them and they’ve got their hand on the trigger. You don’t want them to blow up, but you’ve got to kind of talk them, ease that finger off the trigger.

Right. It’s like you’re at the Jay Leno post-show party and suddenly you notice this AIG vice-president has wandered in, with six figures of bonus strapped to his waist and he’s yelling “Allahu Akbar!” — which is Arabic for “I’d like to deposit this in my Cayman Islands account.”

Maybe Obama’s teleprompter had a wild night on the tiles, and inserted his terrorism speech into the middle of his bonus outrage. But, if not, we now know why the White House announced that they’ll no longer be using the term “enemy combatants” for the Gitmo crowd. They’re reserving that designation for AIG execs, most of whom will shortly be extraordinary-renditioned to Saudi Arabia where a touch of the old electric cattle-prods should soon have their bowling scores heading south.

Any sentient being dumb enough to fall for this AIG huffin’ an’ a-puffin’ from Barry, Barney, Doddy, and the gang is a fool who deserves the vaporization of his assets that the national political class is lining up for him. As Charles Krauthammer pointed out, the $165 million in bonuses is less than 1/18,500 of the $3.1 trillion budget. The massive expansion of government the president is planning is forever, and will ensure you that end your days in what Peggy Noonan calls “post-prosperity America.” More immediately, what message do you send to the world when legal contracts can be abrogated by retrospective confiscatory bills of attainder? You think that’s going to get anyone investing in America again?

The investor class invests in jurisdictions where the rules are clear and stable. Right now, Washington is telling the planet: In our America, there are no rules. Got a legally binding contract? We’ll tear it up. Refuse to surrender the dough? We’ll pass a law targeted at you, yes, you, Mr. Beau Nuss of 27 Plutocrat Gardens, Fatcatville. If you want a banana republic on steroids, this is great news. So cheer on thuggish grandstanding by incompetent legislators-for-life like Barney Frank if you wish. But, in any battle between the political class and the business class, you’re only fooling yourself if you think it’s in your interest for the latter to lose.

The first two months of the Age of the Hopeychange have been an eye-opener. I expected it to be ideologically distasteful to me, but I didn’t expect it to be so inept. Not because I had any expectations of President Obama’s executive skills. But I assumed he’d have folks around him who could take care of details like governing, while he pranced around as the smiley-face hopeychange frontman. But the bench is still empty save for a handful of mediocrities. And the disconnect between the smoothly scripted mush and what’s actually happening makes the telepromptered cool look even more ridiculous.

Op-Ed Columnist: Obama’s Real Test
NYTIMES
By THOMAS L. FRIEDMAN
March 18, 2009

When you hear a sitting U.S. senator call for bankers to commit suicide, you know that the anger level in the country is reaching a “Bonfire of the Vanities,” get-out-the-pitchforks danger level. It is dangerous for so many reasons, but most of all because this real anger about A.I.G. could overwhelm the still really difficult but critically important things we must do in the next few weeks to defuse this financial crisis.

Let me be specific: If you didn’t like reading about A.I.G. brokers getting millions in bonuses after their company — 80 percent of which is owned by U.S. taxpayers — racked up the biggest quarterly loss in the history of the Milky Way Galaxy, you’re really not going to like the bank bailout plan to be rolled out soon by the Obama team. That plan will begin by using up the $250 billion or so left in TARP funds to start removing the toxic assets from the banks. But ultimately, to get the scale of bank repair we need, it will likely require some $750 billion more.

The plan makes sense, and, if done right, it might even make profits for U.S. taxpayers. But in this climate of anger, it will take every bit of political capital in Barack Obama’s piggy bank — as well as Michelle’s, Sasha’s and Malia’s — to sell it to Congress and the public.

The job can’t be his alone. Everyone who has a stake in stabilizing and reforming the system is going to have to suck it up. And that starts with the brokers at A.I.G. who got the $165 million in bonuses. They need to voluntarily return them. Everyone today is taking a haircut of some kind or another, and A.I.G. brokers surely can be no exception. We do not want the U.S. government abrogating contracts — the rule of law is why everyone around the world wants to invest in our economy. But taxpayers should not sit quietly as bonuses are paid to people who were running an insurance scheme that would have made Bernie Madoff smile. The best way out is for the A.I.G. bankers to take one for the country and give up their bonuses.

I live in Montgomery County, Md. The schoolteachers here, who make on average $67,000 a year, recently voted to voluntarily give up their 5 percent pay raise that was contractually agreed to for next year, saving our school system $89 million — so programs and teachers would not have to be terminated. If public schoolteachers can take one for schoolchildren and fellow teachers, A.I.G. brokers can take one for the country.

Let’s not forget, A.I.G. was basically running an unregulated hedge fund inside a AAA-rated insurance company. And — like Madoff, who was selling phantom stocks — A.I.G. was selling, in effect, phantom insurance against the default of bundled subprime mortgages and other debt — insurance that A.I.G. had nowhere near enough capital to back up when bonds went bust. It was a hedge fund with no hedges. That’s why taxpayers have had to pay the insurance for A.I.G. — so its bank and government customers won’t tank and cause even more harm.

Unfortunately, all the money we have already spent on A.I.G. and the banks was just to prevent total system failure. It was just to keep the body alive. That’s why healing the system will likely require the rest of the TARP funds, plus the $750 billion the administration warned Congress in the new budget that it could need.

Best I can piece together, the administration’s recovery plan — due out shortly — will look something like this: The U.S. government will create a facility to buy the toxic mortgages off the balance sheets of the major banks. They will be bought by a public-private fund or funds in which taxpayers will, in effect, be partners with hedge funds and private equity groups. The hedge funds will be there to provide expertise in pricing and trading the assets. The taxpayers will be there to guarantee — gulp — that the hedge funds won’t lose money if they take the early risks and to also lend them money to make some of the purchases. Taxpayers will benefit from any profits these partnerships make.

Once the banks sell their toxic assets, many will need capital, because, while they may be carrying these assets on their books at 85 cents on the dollar, they initially may have to sell them for less. So, the government will probably have to inject capital into more banks to maintain their solvency, but once the banks begin to clear their balance sheets of those toxic assets, they will likely attract the private capital they need and relieve the government of having to put in more.

Will it work? We can only hope. But I know this for sure: unless the banks are healed, the economy can’t lift off, and that bank healing is not going to happen without another big, broad taxpayer safety net.

The only person with the clout to sell something this big is President Obama. The bankers and Congress will have to help; every citizen will have to swallow hard. But ultimately, Mr. Obama will have to persuade people that this is the least unfair and most effective solution. It will be his first big leadership test. It is coming soon, and it is coming to a theater — and a bank — near you.

Editorial: While Everyone Fiddles
NYTIMES
March 13, 2009

The world economy has plunged into what is likely to be the most brutal recession since the 1930s, yet policy makers in Europe and Japan seem to believe there are more important things for them to do than to try to dig the world, including themselves, out.

When Lawrence Summers, President Obama’s top economic adviser, urged countries to increase public spending to boost global demand, Luxembourg’s finance minister, Jean-Claude Juncker, representing the European Union, responded that the prescription was “not to our liking.”

At a meeting this week ahead of an April summit of the world’s largest economies, finance ministers from the European Union declared that they have already done enough to add to domestic demand. In Frankfurt, Axel Weber, the chief of the German central bank added, “We have reached our limits.” Japan’s government is quieter but nearly as resistant.

The United States, which has approved two stimulus packages, plans to spend about 4.8 percent of its gross domestic product by 2010. China is planning to spend nearly 6 percent of its G.D.P. on stimulus programs over the next two years, according to the International Monetary Fund. These numbers are still too small. Yet Europe and Japan are lagging further behind. Germany ’s fiscal boost will amount to just 3.5 percent of its G.D.P. France plans to spend 1.4 percent spread over the next two years, and Britain 1.3 percent. Japan expects to spend 2.2 percent of its G.D.P.

Japan, which struggled with a recession throughout the 1990s, is constrained by a weak government and an enormous pile of debt. Europe, by contrast, has room to spend. But the bigger European countries that share the euro as their currency worry that running big budget deficits will undermine investors’ faith in their economies over the long term and weaken the currency.

Given the current calamity, these concerns seem woefully misguided.

With consumer spending and business investment collapsing around the world, wealthy countries are pretty much the only ones left with the capacity to increase demand to mitigate the economic slump. The price of inaction is getting higher by the day. The World Bank is now forecasting that the global economy will contract this year for the first time since World War II.

What makes this especially puzzling is that the economic data out of Europe and Japan are horrendous. Industrial production in France collapsed 14 percent in January, compared with the year-earlier month. German exports — the pillar of that nation’s economy — plummeted 21 percent. Consumer and business confidence also are sinking. The European Central Bank expects the euro-zone economy to shrink by 2.2 percent to 3.3 percent this year. The I.M.F. expects Japan’s to slip by 2.6 percent.

In 1933, a global conference in London to plot a path out of a worldwide depression collapsed in acrimony. Next month, the leaders of the world’s 20 biggest economies are scheduled to gather in London and give the format another try, meeting to discuss how to fix the global financial system and restore growth.

The world will be much better off if they can agree on three things: to substantially increase fiscal spending at home, to provide financing for poorer countries that cannot do so on their own, and to avoid, by all means necessary, protectionist beggar-thy-neighbor policies that could set the recovery back for years.

In a recent speech, Christina Romer, another of President Obama’s economic advisers, pointed out some lessons from the Great Depression: fiscal stimulus works. And the more countries around the world that do it, “the better off we will all be.” Europe and Japan should listen. So should Washington.

Now Obama Tells Us? What an honest campaign would have sounded like.
National Review
By Victor Davis Hanson
March 12, 2009, 0:00 a.m.

Imagine that last fall, before being elected, Barack Obama had outlined the positions he has embraced since being inaugurated. An honest campaign speech could have gone something like this:

“As we approach Election Day, the American people should not waste the crisis we find ourselves in.

“Consequently, if elected, I promise to get us over the Bush financial meltdown with a stimulus program that will borrow $787 billion — which, of course, will add to the already sizable budget deficit (nearly $500 billion) projected in the Bush administration’s last budget.

“By March of next year, my new $3.6 trillion budget will include a spending bill with over 8,500 budget earmarks to target in-need constituents.

“In addition to the stimulus/borrowing plan, I intend to devote $634 billion to fund a new supplementary national health-care system. But that is not all. Unfortunately, the initial Bush bank bailout of some $700 billion also may well have to be augmented by an additional $750 billion.

“Although my new spending proposals may raise the federal deficit in my first year to $1.75 trillion, I promise the American people that by the end of my first term, I will halve the federal deficit — albeit adding another $3 to $5 trillion to the national debt.

“Those savings can be accomplished by upping the federal income tax to about 40 percent on those rich 5 percent of Americans who currently pay only 60 percent of our aggregate income taxes — as well as lifting Social Security caps on their payroll taxes and cutting out many of their tax deductions.

“With state income taxes, federal income tax, and Social Security and payroll taxes, along with new cutbacks in deductions, some of these rich will pay over 60 percent of their incomes in taxes. That is not an unreasonable rate in comparison with past levels — or the fact that well over 40 percent of Americans do not make enough to pay any federal income taxes.

“I expect that Wall Street may react negatively to these proposals. We may see the Dow fall an additional 2,000 to 3,000 points after I’m elected. It may descend to under 7,000 during my first weeks of office. And this may be the moment when the economy continues to cool and unemployment rises.

“But to deal with this reaction of entrenched interests, I promise a fresh team of hard-nosed American professionals — understanding that it is impossible to ensure that none have past insider connections and occasional tax problems.

“From the former Clinton administration, I will select Rahm Emanuel to run my staff. To oversee revenue, Timothy Geithner will assemble a large team at Treasury. Senator Clinton herself will run State, and I will anchor my cabinet with pros like Tom Daschle, Eric Holder, Bill Richardson, and Hilda Solis.

“On matters of protecting civil libert