links, commentary, toons, pics, fun!

Monday, March 23, 2009


here's the flyer for our show on Friday...

If you have a Facebook account click on the image to see an event page. (I still don't have FB, so I haven't seen it yet myself!)

Saturday, March 21, 2009

saturday music blogging

a cool new Ruby Suns vid:

A segment from BBC2 on Fleet Foxes:

watch the Flaming Lips cover Madonna here

promo for a new concert doc from The Hold Steady:

and a new Wilco concert film:

Tuesday, March 17, 2009

torches and pitchforks

Matthew Yglesias:

We’ve somehow managed to construct something of a post-shame society, in which elites have convinced themselves that the rational agent model of human behavior is not just a useful modeling tool, but an ethical guidebook. There’s something to be said for the idea of a sense of honor and personal responsibility.

That this point even needs to be made is a sad in itself.

Kevin Drum says that if nationalizing the banks sounds bad, all the alternatives are worse:

And in truth, nationalization is more than the least worst option: It actually has a lot of benefits. It allows rapid reorganization and write-down of debts without the associated chaos of a bank failure. It wipes out shareholders and forces creditors to take a haircut, just as in a normal bankruptcy. And unlike endless capital injections in return for small stakes, it's a fair option for American taxpayers, who deserve to own more than just a minority share if they're investing more than the bank is worth in the first place.

Nationalization also solves the problem of valuing toxic assets: The government can simply sit on the stuff until the market turns up and then sell it off for the best price it can get. There's no need to immediately value it at all. Most important, with the full faith and credit of the United States government behind them, nationalized banks can be recapitalized and made into functional credit providers again. And as soon as they're back on their feet, they can be sold back to the private sector, as happened in Sweden. Taxpayers will still lose a lot of money on the deal—there's really no way of avoiding that at this point—but nationalization keeps those losses lower than any of the alternatives.

And there's one more thing about nationalization to keep in mind: We already do it all the time. The FDIC now takes over small banks every week, and among bigger institutions the government has already effectively nationalized Fannie Mae, Freddie Mac, and insurance giant AIG. And for the most part, life goes on as usual. If Citigroup or Bank of America were taken over, the board of directors would be dissolved, some of the senior staff would be replaced, shareholders and bondholders would take a hit, and the bank would continue running as normal except with a stronger capital base and government guarantees behind it. Then, in a few years, it would be refloated and put back in private hands. It's not as scary as it sounds.

As finance blogger Steve Waldman has put it, "real capitalists nationalize." The fundamental principle of a free market system is that ownership and control of failed enterprises should reside in the hands of whoever buys up the corpse. If that's the government, then that means nationalization. This may be why temporary nationalization has won the support not just of mainstream economists like Nouriel Roubini and Paul Krugman, but of no less a free market acolyte than former Fed chairman Alan Greenspan. "It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring," he told the Financial Times in February. "I understand that once in a hundred years this is what you do."

Obama introduces his budget:

Jefferson Morley has a great short analysis on the politics of passing Obama's budget and the outlook on bipartisanship.

my thanks to Molly for alerting me to the "blog" of "unnecessary" quotation marks. Good stuff!

nice shirt:

Monday, March 16, 2009

aig, etc

Today's edition is dedicated to the sanctity of contractual commitments...

Josh Marshall:

We're collectively taking our country's future in our hands, spending vast sums of money to keep these companies from suffering the consequences of their own folly and (in many cases) criminality. And in return we're receiving cavalier dictates about pay-outs and bonuses from executives who by any reasonable measure work for us -- dictates we promptly accede to. There's a beggars can't be choosers problem there. And the disconnect is so mighty that it fuels the impression that the whole enterprise is not what it seems, not what we've been told, that in addition to picking up the tab we're being played for fools.

Robert Reich:

The administration is said to have been outraged when it heard of the bonus plan last week. Apparently Secretary of the Treasury Tim Geithner told AIG's chairman, Edward Liddy (who was installed at the insistence of the Treasury, in the first place) that the bonuses should not be paid. But it turns out that most will be paid anyway, because, according to AIG, the firm is legally obligated to pay them. The bonuses are part of employee contracts negotiated before the bailouts. And, in any event, Liddy explained, AIG needs to be able to retain talent.

AIG's arguments are absurd on their face. Had AIG gone into chapter 11 bankruptcy or been liquidated, as it would have without government aid, no bonuses would ever be paid (they would have had a lower priority under bankruptcy law that AIG's debts to other creditors); indeed, AIG's executives would have long ago been on the street. And any mention of the word "talent" in the same sentence as "AIG" or "credit default swaps" would be laughable if laughing weren't already so expensive.

This sordid story of government helplessness in the face of massive taxpayer commitments illustrates better than anything to date why the government should take over any institution that's "too big to fail" and which has cost taxpayers dearly. Such institutions are no longer within the capitalist system because they are no longer accountable to the market. To whom should they be accountable? As long as taxpayers effectively own a large portion of them, they should be accountable to the government.

But if our very own Secretary of the Treasury doesn't even learn of the bonuses until months after AIG has decided to pay them, and cannot make stick his decision that they should not be paid, AIG is not even accountable to the government. That means AIG's executives -- using $170 billion of our money, so far -- are accountable to no one.

Josh Marshall (again):

Whatever else you can say about AIG CEO Edward Libby, he ain't much for irony. In his letter to Secretary Geithner he said that AIG "cannot attract and retain the best and brightest talent ... if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury."

As noted yesterday, the bonuses are overwhelmingly weighted toward AIG's Financial Products division (AIGFP), the relatively small division responsible for the company's de facto bankruptcy and no little part of the world financial crisis.

With respect to AIGFP, there's no little snarking to be had about whether these folks are really the "best and the brightest." But it actually goes beyond that. It's not just the people. The whole division is toxic and should be shut down, probably the building should be razed and the ground salted.

the scale and nature of a lot of the losses at AIGFP go well beyond reckless and folly. A lot of it looks like fraud. And go-go operations like AIGFP don't tend to fare too well in general when subjected to searching legal scrutiny. The government should be making it clear that criminal investigators are reviewing the entire matter. Contracts don't easily withstand credible allegations of illegal behavior. And the executives in question need to have their attention focused on the calculus of levels of cooperation and legal vulnerability rather than compensation packages.

Time Mag
piles on CNBC:

To watch CNBC today is to enter an alternative universe, where élites are populists, Wall Street is Main Street and bank executives are the oppressed. It's not surprising that a voice of opposition to the new Administration would emerge. But who would have thought it would be on a channel not owned by Rupert Murdoch?

In a way, CNBC has no choice but to become political, since the economy itself has. And CNBC faces the same dilemma as the rest of the media: If psychology drives the economy, when does reporting bad news become creating bad news? How do you walk the line between desperate cheerleading and reckless ranting?

CNBC's answer has been to dive off both sides of the line at once.

CNBC's reaction is colored by its stressed-out day trader's focus on the short term. When ordinary people think about the economy, they think about jobs, college, retirement. Sure, the stock market affects them in the long run — but so do job security and the threat of getting wiped out by health-care bills. When CNBC considers the economy, it means Wall Street's numbers that day, that hour, that minute. CNBC may pay lip service to the long term, but it has the time horizon of a fruit fly.

This means that CNBC looks at everything, particularly politics, in terms of how it will affect "the Market." The commentators on CNBC murmur about the Market as if it were the Island on Lost: a mystic force that must be placated, lest it become angry and punish us. "The Market doesn't like ..." "What the Market wants to see is ..."

And, oooh, is the Market cranky at Obama! The Market doesn't like raising taxes on the wealthy (even if Buffett does). The Market doesn't like government health-care reform or cap-and-trade environmental policy or big budgets or limiting bonuses at bailed-out banks. And don't get the Market started on bank nationalization. That ticks the Market off!

The NYT has an article about the party scene for Wall Street types that is thriving even amidst the failing economy:

Spend $500 on two magnums of Veuve Clicquot Champagne at Bagatelle on West 13th Street in the meatpacking district, and the bottles are delivered to your table with lighted sparklers stuck in their corks.

Spend $2,500 on a jeroboam of Veuve Clicquot and some magnums of Dom Pérignon, and the lights dim, the D.J. cues up the theme from “Superman,” and a waiter is hoisted onto the shoulders of his fellow servers. With a tablecloth knotted around his neck as a makeshift cape and his arms outstretched, he carries one of the blazing bottles of bubbly to your table.

As the waiter soars through the air, he does so against a backdrop of patrons fist-pumping Champagne flutes, flashing cameras capturing pictures ripe forFacebook and a dozen young women clad in sequins, stilettos and Chanel bags climbing onto chairs, banquettes, even tables — any elevated surface that is sturdy enough to dance on.

Christie Larkin, a 28-year-old who lives in Gramercy Park and works for a TriBeCa advertising agency, was brunching at Bagatelle for the first time. “It’s like Friday night in here!” she said upon walking in.

But it is not Friday night. It is 3:30 Saturday afternoon.

Champagne corks are always popping somewhere, of course, and the high life never disappears entirely, especially in New York. But these days, a $750 magnum of Perrier-Jouët stands in striking contrast to the scene outside Bagatelle’s glass-paneled door, where the Dow has lost half its value since the fall of 2007, the recession has claimed a net total of 4.4 million jobs since it began, more than 850,000 families lost their homes to foreclosure last year, and the word “depression” is being heard in the land.

Whatever diversion these afternoons bring, some acknowledged that the sight of the young well-to-do partying hard when many financial firms are being castigated for profligate spending could appear embarrassing.

A man who works in finance and was standing near the bar of Merkato 55 the following Saturday started to talk about this issue, but then he had second thoughts, saying he could be fired for drawing attention to the subject in the news media. Any overt display of conspicuous spending, he added, even if not a dime was expensed to a corporate account, would not sit well with his employer. “Excess,” he said, “is frowned upon heavily.”

As for how he and his fellow Wall Streeters could still afford such afternoons, he said: “We all made so much money in the past five years, it doesn’t matter.”

A 29-year-old man who works for a large investment management firm and was at Bagatelle’s brunch one recent Saturday and at Merkato 55’s the next, put it another way: “If you’d asked me in October, I’d say it’d be a different situation, and I don’t think I’d be here. Then the government gave us $10 billion.”


Someone leaked a copy of a secret Red Cross report on detainee treatment to journalist Mark Danner, who has written two articles about it: a longer account of the contents for the New York Review of Books, and a shorter version for the NYT. The latter ends by saying:

Abu Zubaydah, Walid bin Attash, Khalid Shaikh Mohammed — these men almost certainly have blood on their hands. There is strong reason to believe that they had critical parts in planning and organizing terrorist operations that caused the deaths of thousands of people. So in all likelihood did the other “high-value detainees” whose treatment while secretly confined by the United States is described in the Red Cross report.

From everything we know, many or all of these men deserve to be tried and punished — to be “brought to justice,” as President Bush vowed they would be. The fact that judges, military or civilian, throw out cases of prisoners who have been tortured — and have already done so at Guantánamo — means it is highly unlikely that they will be brought to justice anytime soon.

For the men who have committed great crimes, this seems to mark perhaps the most important and consequential sense in which “torture doesn’t work.” The use of torture deprives the society whose laws have been so egregiously violated of the possibility of rendering justice. Torture destroys justice. Torture in effect relinquishes this sacred right in exchange for speculative benefits whose value is, at the least, much disputed.

As I write, it is impossible to know definitively what benefits — in intelligence, in national security, in disrupting Al Qaeda — the president’s approval of use of an “alternative set of procedures” might have brought to the United States. Only a thorough investigation, which we are now promised, much belatedly, by the Senate Intelligence Committee, can determine that.

What we can say with certainty, in the wake of the Red Cross report, is that the United States tortured prisoners and that the Bush administration, including the president himself, explicitly and aggressively denied that fact. We can also say that the decision to torture, in a political war with militant Islam, harmed American interests by destroying the democratic and Constitutional reputation of the United States, undermining its liberal sympathizers in the Muslim world and helping materially in the recruitment of young Muslims to the extremist cause. By deciding to torture, we freely chose to embrace the caricature they had made of us. The consequences of this choice, legal, political and moral, now confront us. Time and elections are not enough to make them go away.

buhdydharma argues that this evidence obligates the Obama Adm to investigate and prosecute crimes.

Fareed Zakaria on Obama's foreign policy and its critics:

though consumed by the economic crisis in its first 50 days, the Obama administration has nevertheless made some striking moves in foreign policy. Obama announced the closure of Guantánamo and the end of any official sanction for torture. He gave his first interview as president to an Arab network and spoke of the importance of respect when dealing with the Muslim world—a gesture that won him rave reviews from normally hostile Arab journalists and politicians.

Hillary Clinton has racked up more miles in a few weeks than many of her predecessors as secretary of state did in months, mixing symbolic gestures of outreach with substantive talks. The administration has signaled a willingness to start engaging with troublesome regimes like Syria and Iran. Clinton publicly affirmed that the United States would work with China on the economic crisis and energy and environmental issues despite differences on human rights. She has also offered the prospect of a more constructive relationship with Russia. Obama said he was open to the prospect of talking to some elements of the Taliban in an effort to isolate its hard-core jihadis.

These are initial, small steps but all in the right direction— deserving of praise, one might think. But no, the Washington establishment is mostly fretting, dismayed in one way or another by most of these moves.

The problem with American foreign policy goes beyond George Bush. It includes a Washington establishment that has gotten comfortable with the exercise of American hegemony and treats compromise as treason and negotiations as appeasement. Other countries can have no legitimate interests of their own—Russian demands are by definition unacceptable. The only way to deal with countries is by issuing a series of maximalist demands. This is not foreign policy; it's imperial policy. And it isn't likely to work in today's world.

Nate Silver:

There are now two significant drags on Obama's approval. One is the economy: even though most people mostly blame Bush for the economic crisis (or more apolitical forces like the banks themselves), with each day that passes during the contraction, more people are going to get frustrated and begin to blame Obama, in whole or in part. My impression is that Obama's approval ratings are likely to follow one of the following three general paths, depending on how quickly the economy recovers:

Now, if the White House is thinking about these things the same way that I am, they'll figure that there's no time to lose in rolling out their agenda: this is the very probably the best policymaking window they'll have until the economy recovers, and if the recovery is slow in coming, it might be the best policymaking window they'll have at any point in the term.

Indeed, the White House does seem to be thinking along these lines, as they've started the ball rolling on health care, cap-and-trade, the budget, stem cell research, Iraq, and virtually every other significant piece of their agenda.

And this brings us to the second significant drag on Barack Obama's approval ratings: the public isn't universally enamored of his agenda, which he's now put front and center. On this point, I'm in superficial agreement with Goldfarb, Schoen and Rasmussen. Obama's approval rating would be higher if he hadn't tried to do anything substantive. Most of the public agrees with most of the agenda, but certainly not a 65 or 70 percent supermajority.

But a president's goal is not to maximize his approval rating; it's to maximize the amount of policy that he's able to push forward over the balance of his term. Obama is using a lot of his political capital now in order to try and push forward a lot of agenda -- but this, I would argue, is wise, because otherwise some of that political capital will evaporate anyway owing to the economy.

It's a risky play to be sure, and it will be fascinating to watch. But with the White House having made that choice, the fact that Obama's approval rating has responded in the way that it has is utterly unsurprising, especially given the underlying drip-drip-drip of the economy.

Frank Rich sees history repeating itself in more ways than one:

Someday we’ll learn the whole story of why George W. Bush brushed off that intelligence briefing of Aug. 6, 2001, “Bin Laden Determined to Strike in U.S.” But surely a big distraction was the major speech he was readying for delivery on Aug. 9, his first prime-time address to the nation. The subject — which Bush hyped as “one of the most profound of our time” — was stem cells. For a presidency in thrall to a thriving religious right (and a presidency incapable of multi-tasking), nothing, not even terrorism, could be more urgent.

When Barack Obama ended the Bush stem-cell policy last week, there were no such overheated theatrics. No oversold prime-time address. No hysteria from politicians, the news media or the public. The family-values dinosaurs that once stalked the earth — Falwell, Robertson, Dobson and Reed — are now either dead, retired or disgraced. Their less-famous successors pumped out their pro forma e-mail blasts, but to little avail. The Republican National Committee said nothing whatsoever about Obama’s reversal of Bush stem-cell policy. That’s quite a contrast to 2006, when the party’s wild and crazy (and perhaps transitory) new chairman, Michael Steele, likened embryonic stem-cell research to Nazi medical experiments during his failed Senate campaign.

What has happened between 2001 and 2009 to so radically change the cultural climate? Here, at last, is one piece of good news in our global economic meltdown: Americans have less and less patience for the intrusive and divisive moral scolds who thrived in the bubbles of the Clinton and Bush years. Culture wars are a luxury the country — the G.O.P. included — can no longer afford.

Not only was Obama’s stem-cell decree an anticlimactic blip in the news, but so was his earlier reversal of Bush restrictions on the use of federal money by organizations offering abortions overseas. When the administration tardily ends “don’t ask, don’t tell,” you can bet that this action, too, will be greeted by more yawns than howls.

Once again, both the president and the country are following New Deal-era precedent. In the 1920s boom, the reigning moral crusade was Prohibition, and it packed so much political muscle that F.D.R. didn’t oppose it. The Anti-Saloon League was the Moral Majority of its day, the vanguard of a powerful fundamentalist movement that pushed anti-evolution legislation as vehemently as it did its war on booze. (The Scopes “monkey trial” was in 1925.) But the political standing of this crowd crashed along with the stock market. Roosevelt shrewdly came down on the side of “the wets” in his presidential campaign, leaving Hoover to drown with “the dries.”

Much as Obama repealed the Bush restrictions on abortion and stem-cell research shortly after pushing through his stimulus package, so F.D.R. jump-started the repeal of Prohibition by asking Congress to legalize beer and wine just days after his March 1933 inauguration and declaration of a bank holiday. As Michael A. Lerner writes in his fascinating 2007 book “Dry Manhattan,” Roosevelt’s stance reassured many Americans that they would have a president “who not only cared about their economic well-being” but who also understood their desire to be liberated from “the intrusion of the state into their private lives.” Having lost plenty in the Depression, the public did not want to surrender any more freedoms to the noisy minority that had shut down the nation’s saloons.

Saturday, March 14, 2009

saturday music blogging

here are some music vidz for your enjoyment:

New YYY video:

Snippets from the upcoming Sonic Youth album:

Beirut on Letterman:

Deerhunter try out a new one:


Fiery Furnaces:

classic Shins:

Ruby Suns:

Animal Collective:

The Sea & Cake cover Bowie:

happy pi day

Laura D'Andrea Tyson provides a defense of 'Obamanomics' in the WSJ:

If leadership is defined as recognizing a crisis, addressing its challenges, and setting new directions while remaining true to one's values, then Barack Obama is already demonstrating his strengths as a leader. He has inherited an economic crisis worse than any the nation has experienced since the Great Depression. Within fewer than 50 days in office he has signed a historic stimulus package to bolster demand and create 3.5 million jobs. Governors, business leaders and economists from both the left and the right have applauded the stimulus. Friday's distressing employment numbers indicate that much more may be needed.

President Obama has also proposed a 10-year budget that is faithful to the progressive vision he articulated during his campaign. His budget includes significant investments in health care, energy, the environment and education, and a tax cut for the middle class. It also calls for higher taxes on the top 3% of income earners to finance his priorities and reduce the deficit. Not surprisingly, a budget plan this ambitious is triggering strong and well-organized opposition on numerous fronts.

Michael Lind thinks Obama is being too timid:

Once upon a time in the United States, public goods -- from retirement security and energy research to public roads -- were provided by the government and paid for by taxes. As late as the Nixon administration, the provision of public goods by government was considered perfectly compatible with a robust market economy by so-called Modern Republicans like Eisenhower and Nixon as well as New Deal Democrats like Roosevelt, Truman, Kennedy and Johnson. In the intervening 40 years, however, free-market fundamentalists of the Chicago School have managed to change the debate, redefining "socialism" to mean not only public ownership of the means of production, but also public provision of public goods.

Rather than fight back, most Democrats in the last generation adapted to this hostile conservative political climate by jettisoning New Deal "big government" liberalism for "market-friendly" neoliberalism. Neoliberals shared the right's enthusiasm for deregulating industries that New Deal Democrats had regulated in the public interest. Jimmy Carter and Ted Kennedy supported the deregulation of trucking and airlines, while Bill Clinton presided over the dismantling of the New Deal era's banking regulations and declared: "The era of big government is over." Neoliberals and conservatives agreed that public goods should be provided by private, for-profit or nonprofit entities, rather than government agencies. If private corporations or universities had no motivation to provide public goods, well, then, they would be bribed with tax credits or other government subsidies.

Neoliberals are liberals in one sense -- they fret about unequal outcomes. But rather than help middle- and low-income Americans by regulating the prices of privately provided public goods, as the crude and direct New Dealers would have done, neoliberal Democrats have argued for allowing the "market" (translation: the publicly subsidized entities) to set prices and then promised to provide tax subsidies or grants to help middle- and low-income Americans pay for the expensive, privately provided public goods.

You might have thought that the Crash of 2008 would have led Democrats to reconsider this neoliberal approach to providing public goods by private means. But to judge from President Obama's budget, the White House is still living back in the neoliberal era, when the diminutive Milton Friedman cast a giant shadow.

We've been hearing a lot from Republicans about how we don't want to be like Europe... um, actually we could learn a lot from our friends across the pond.

Michael Hirsh:

The New Deal is shrouded in myth—and considerable controversy—but there is little doubt that FDR swiftly restored confidence after he took office on March 4, 1933. He immediately announced a "bank holiday" and began a series of fireside chats. As Liaquat Ahamed writes in his wonderful new history, "Lords of Finance," the nation's mood shifted almost overnight: People were still lined up outside the banks, but they'd gone from running to returning as depositors. When the banks opened a week later, the Dow Jones average rose 15 percent in the first day of trading. It soared 75 percent (granted, from rock bottom) in the first 100 days of FDR's presidency. The problem today, 50 days into the Obama administration, is that despite the fitful market jumps this week, no dramatic change of mood has occurred. The bottom-line issue across the landscape—on Wall Street, on Main Street, in boardrooms and households—remains a lack of confidence. The entire financial system has failed, and until people start believing in the system again, credit will only dribble out, not flow freely.

Of course FDR took charge three full years into the Depression. Yes the market was ever descending, but by then we could understand why: as the economy worsened companies went out of business or had to downsize, which meant there was less spending money to go around, which meant further declining revenues for companies, and the cycle repeats itself. Presently we are starting to see the same dynamic take hold, but we haven't yet been able to even assess the integrity of our financial institutions. It appears that the major banks are insolvent (bankrupt), but we don't even really know that. (that the banks are talking about returning gov't loans is grounds for optimism... unless they're just whining and full of shit, which is also a distinct possibility) And it will be difficult to determine because the bank records are intentionally hard to interpret, as bad assets were "buried" in ways that would be hard to find. So it's hard to inspire confidence when it's open secret that nobody really knows the true status of anything. Imagine FDR had taken over at the start of 1930, when the scope of what was happening was not yet understood, and you would have a better analogy. But the good news is, of course, that we are dealing with this crisis at the beginning rather than after it has whipped our collective asses, so hopefully we will be able to keep things from unraveling so dramatically.

Robert Kuttner says if we don't get a handle on this crisis we could end up with a situation even worse than the Great Depression.

All of these economic calamities have solutions, but each is more radical that what's currently on offer. The government will have to temporarily nationalize major banks, sort out good assets from bad ones, and then return banks to responsible private ownership. To cure the housing collapse, government should directly refinance mortgages, rather than trying to bribe banks to ease terms.

Deficits will have to be a lot larger before they can get smaller.

Indeed the problem with the New Deal is that it did not go far enough:

Roosevelt was said to be a big spender, but his biggest peacetime deficit was only about 6 percent of gross domestic product. This year, the deficit will exceed 11 percent, and the recession will deepen all year. It took the truly massive deficits of World War II -- nearly 30 percent of GDP -- to finally end the Great Depression.

Hopefully it won't require a world war for us to spend our way out of our current mess

If foreign borrowing dries up, we may need to sell massive amounts of recovery bonds to Americans, just as we relied on war bonds rather than borrowing from abroad during World War II.

If government is spending upward of a trillion dollars to stimulate demand, those dollars can be used for social investments that we should have had all along -- things like decent early childhood education and comprehensive health insurance and clean energy. The government needs to view these investments not as a one-shot but as an ongoing commitment to a just society.

President Obama needs to grasp just how radical a set of solutions we need. Then he needs to use his gifts as teacher-in-chief to persuade the public and the Congress to follow his lead.

Meanwhile, we have to deal with this nonsense:

The House Republican leaders' pre-recession mindset is so overwhelming, their ignorance isn't just embarrassing, it's frightening.

House Republican Leader John Boehner of Ohio, appearing after Orszag on "Face the Nation," replied: "American families are tightening their belt, but they don't see government tightening its belt. And I think we can get through this year and lead by example, and show the American people that the government can go on a diet as well." [...]

On CNN, House Republican Whip Eric Cantor of Virginia said: "Director Orszag and others say, look, we've inherited these trillions dollars of deficits. Well, if you've got a situation like that, how in the world should you be going and make it worse? Families are not doing that."

I know there are people who take these guys seriously. I just don't know why. When it comes to economic policy, two of the top Republican policymakers in the federal government are not only in flat-earth territory, they can't imagine why anyone would have the audacity to think the planet is round.

They have literally regressed into Herbert Hoover Republicans. Jonathan Chait, reviewing the recent revisionist histories that argue the New Deal didn't work, provides some perspective:

When they say that the New Deal "didn't work," conservatives almost always mean New Deal fiscal stimulus. (Other policies, such as Social Security or clearing the way for unions, clearly succeeded on their own terms, whatever their ideological merits.) And then, in turn, they confuse New Deal fiscal stimulus with Keynesian economics, which is also not exactly the same thing. So let me step back and briefly explain for the uninitiated what Keynesian economics means. We may not all be Keynesians now, but we would all benefit from knowing what a Keynesian actually is.

Prior to Keynes, the economy was held to be self-correcting. The only cure for a recession was to let wages and prices fall to their natural level. The prevailing attitude, as Paul Krugman writes in his recently re-issued book The Return of Depression Economics, was "a sort of moralistic fatalism." Keynes upended the orthodoxy in a way that was every bit as dramatic as Galileo challenging geocentrism. He insisted that recessions are not a natural process, or the invisible hand's righteous judgment against our sins, but a simple failure of consumer demand.

When people worry about losing their jobs, they sensibly cut back on their spending. But that decision, in turn, reduces demand for goods and services, which results in reduced income or lost jobs for other workers. Keynes called this phenomenon "the paradox of thrift": what makes sense for individuals turns into a disaster for society as a whole. The recession was therefore a failure of collective action that required government action. Government needed to encourage spending by reducing interest rates or, failing that, to inject spending into the economy directly by deliberately running temporary budget deficits.

At the time, orthodox economists deemed this diagnosis heretical and dangerous, but, in the decades that followed, it became a consensus view. Today economists disagree sharply about how to apply Keynes's insights, with many conservative economists questioning the practicality of large-scale government spending to combat recessions; but the essential framework constructed by Keynes--that recessions are caused by a failure of demand, and that at the very least government should not respond to an economic slowdown by paring back its largesse--is no longer in dispute. Even a right-wing Republican economist such as Gregory Mankiw, a former Bush advisor, writes that "if you were going to turn to only one economist to understand the problems facing the economy, there is little doubt that the economist would be John Maynard Keynes."

But everywhere you look, conservative pundits and elected officials have embraced the pre-Keynesian nostrums.

Moreover, the classic right-wing critique fails to explain how the economy recovered at all. In one of his columns touting Shlaes, George Will observed that "the war, not the New Deal, defeated the Depression." Why, though, did the war defeat the Depression? Because it entailed a massive expansion of government spending. The Republicans who have been endlessly making the anti-stimulus case seem not to realize that, if you believe that the war ended the Depression, then you are a Keynesian.

After 1932, generations of Democrats continued to paint Republicans as neo-Hooverites. This was mostly a calumny. Though Hoover himself continued to assail the New Deal as calamitous socialism right up to his death in 1964, from 1936 on the party remained in the hands of men who understood that the New Deal had built an enduring base of support and could not be directly assailed.

But now we have come to a time when leading Republicans and conservatives--not just cranks, but the leadership of the party and the movement--once again sound exactly like Herbert Hoover. "Prosperity cannot be restored by raids upon the public Treasury," said President Hoover in 1930. "Our plan is rooted in the philosophy that we cannot borrow and spend our way back to prosperity," said House Minority Leader Boehner in 2009. They have come to this point by preferring theology to history, by wiping Hoover's record from their memories and replacing it with something very close to its opposite.

I haven't actually watched Jon Stewart's dismantling of Jim Cramer yet, but from what I've read it was pretty brutal. Personally I'm worried that I'll feel sorry for the guy, so I'll wait 'till the next time I'm feeling vengeful to watch it.

I never really get this dude's cartoons, but they seem 'deep' so whatever:


Sunday, March 8, 2009

a few things...

check out


(every time you refresh you get a new one!)

this would have fit in nicely with my graphs and charts post yesterday:
So much for the war on the rich.

Some articles of note:

Elizabeth Drew has a fascinating inside look
at the first thirty days of Obama's Presidency. (Great stuff.)

Michael Lewis has another article out about the economy. This one's about what's going on in Iceland now that the entire country's bankrupt. (Lewis has a knack for making this stuff interesting and fun.)

The New Yorker considers David Foster Wallace's unfinished follow-up to the Infinite Jest.

Sean Quinn at has an interesting post
considering why some Republicans refer to their opposition as the "Democrat Party."

Oh, and can I also just note that last week I linked to a post that jokingly suggested Obama must have Jedi mind powers given his apparent success at making Republicans implode re: Rush Limbaugh... well that idea apparently, and insanely, gained some real traction last week. The Quinn post above begins in response to a Republican who accuses Democrats childishly making Republicans do nothing but talk about Limbaugh. The same guy childishly refers to the Democratic Party as the Democratic Party, hence Quinn's post, but the idea that Obama is responsible for the Republicans' intra-party squabbling/apologizing is itself really an amazing proposition.

Josh Marshall:

It seems the Obama White House is mobilizing the vast power of the federal government to make Rush really popular among GOP nutball dead-enders, then coax various Republican officials to criticize Rush and then compel these same officials to issue craven and humiliating recantations of those criticisms.

The right's capacity for gonzo victimhood really knows no end. Let's focus on the realities here. Most people don't like Rush Limbaugh. But for whatever reason he remains a redeemer-like figure for the rump of the Republican party. Politically that's a very bad place for the GOP to be. They're unable to criticize him. And their need to kowtow to him marginalizes them. But enough of the structural ins and outs of it. Fundamentally, it's bad for Republicans because Rush is really where the GOP is right now. That's all that's left. And most Americans really don't like that.

Speaking of insanity, did you hear how the Republicans want to enact a "spending freeze?" David Brooks:

Josh Marshall puts it more bluntly:

Let's just stipulate DC Republicans are simply not part of the discussion when it comes to repairing the US economy or arresting our slide into deep economic misery. And any reporters who aren't clear about this are just lying to their readers or viewers. The latest Republican plan, in the face of today's new spike in unemployment, is a freeze on federal spending. I'm not even sure it's fair to say that this is a replay of the disastrous decisions the magnified the Great Depression between 1929 and 1933. It's more a parody of it. When the crisis is a rapid and catastrophic drop off in demand, you handcuff the one force that can create demand (i.e., the federal government) in the throes of the contraction. That's insane. Levels of stimulus are a decent question. Intensifying the contraction is just insane and frankly a joke. It's time to recognize that the only debate here is happening among Democrats and sundry non-affiliated sane people. The leaders of the GOP are simply not part of the conversation.

Barry Blitt, NYT


Saturday, March 7, 2009

end of weekend music blogging

I thought I'd cap off the weekend with of a bit of music blogging...

For those entertained by band rivalries, perhaps we have a new one. Wayne Coyne of the Flaming Lips had some not so nice words for the Arcade Fire, which band member Win Butler responded to here.

There's yet another Bonnie 'Prince' Billy album coming out and, as always, it's good. Here's a video:

The New Yorker has an interesting profile of Oldham here.

And here's BPB on WNYC:

This is a few years old now, but for my money this Beirut video is an absolute classic:

Dinosaur is back in the studio:

the pitchfork500

At the library I work at we recently got the Pitchfork 500 book, which is pretty interesting. Basically it goes through 500 songs ("from punk to the present") which have altered the course of indie music, each with a short explanation of what was so special about them. (You can see a list of the songs here) It does a pretty good job I think, but it got me wondering if the focus on individual songs is really justified. I mean, was it the song Summer Babe that had such an influence on everyone, or was it the album Slanted & Enchanted, or was it Pavement's live performances or what? I would imagine it's the cumulative effect of a band/artist's general aesthetic that really influences people. The idea behind the book seems to be that these songs were revelatory for people, in that they opened up new avenues for musical exploration... and I'm sure there are real examples of that happening, but I feel like that's probably pretty rare. I'm sure in some cases the songs didn't cause music to change, but rather reflected and crystallized changes that were already occuring. In college I took a class on the philosophy of history, perhaps there needs to be a class on the philosophy of indie rock. Really I'm just skeptical of all musical lists and rankings, although that doesn't stop me from reading them.

Anyone have any music recommendations for me? Post in the comments!

enter the videodrome

some vids...

Obama's weekly offering:

gotta love that straight up hypocrisy:

(and Fox even called him on it, who'da thunk?)

Sen. Claire McCaskill goes in for the kill:

GOP urban outreach:

Stewart rips CNBC:

Colbert on Glenn Beck's War Room:

The Colbert ReportMon - Thurs 11:30pm / 10:30c

Stephen Colbert gets a Doom Bunker:

The Coen Bros. made this great ad for "clean coal:"

(for more, check out this clever site)

Jimbo pointed me to this powerful video in which neuroscientist recounts her own stroke. Amazing stuff:


some graphs and charts I found interesting (click on any for more info):

What 4.4 Million Jobs Lost Over 14 Months Looks Like by Speaker Pelosi.


Tuesday, March 3, 2009


Some afternoon reading:
Obama may use 50-vote tactic on energy, healthcare- I didn't realize it was so controversial, but Reagan did it, so why not?
Joe Klein: On Moderation (Klein responds to D. Brooks op-ed that says Obama is trying to do too much at once.)

Robert Shrum: Obama's Morning in America (Obama the next FDR, Reagan?)

Ronald Brownstein: Repudiating Bush (Key leaders in our nation's history have usually followed epic failures)
A. Serwer: Jedi Mind Tricks (Is Obama somehow controlling the Republican party? Why are they self-destructing?)

This is pretty hilarious: stupid rich people trying to earn just under 250,000 dollars because they don't understand how the tax system works. And the stupid reporter doesn't get it either.

Bipartisan challenges moving forward

Monday, March 2, 2009

(Associated Press)

let's try to wrap our minds around this budget, shall we? The New York Times has a slew of articles on the subject so we'll start there:


Proclaiming a “once in a generation” opportunity, President Obama proposed a 10-year budget on Thursday that reflects his determination in the face of recession to invest trillions of dollars and his own political capital in reshaping the nation’s priorities.

Mr. Obama would overhaul health care, begin to arrest global warming, expand the federal role in education and shift more costs to some corporations and the wealthiest taxpayers.

In a veiled gibe at the Bush years, Mr. Obama said his budget broke “from a troubled past” and attributed the current economic maelstrom to “an era of profound irresponsibility that engulfed both private and public institutions from some of our largest companies’ executive suites to the seats of power in Washington, D.C.”

The budget that President Obama proposed on Thursday is nothing less than an attempt to end a three-decade era of economic policy dominated by the ideas of Ronald Reagan and his supporters.

The Obama budget — a bold, even radical departure from recent history, wrapped in bureaucratic formality and statistical tables — would sharply raise taxes on the rich, beyond where Bill Clinton had raised them. It would reduce taxes for everyone else, to a lower point than they were under either Mr. Clinton or George W. Bush. And it would lay the groundwork for sweeping changes in health care and education, among other areas.

More than anything else, the proposals seek to reverse the rapid increase in economic inequality over the last 30 years. They do so first by rewriting the tax code and, over the longer term, by trying to solve some big causes of the middle-class inc


President Obama’s new budget represents a huge break, not just with the policies of the past eight years, but with policy trends over the past 30 years. If he can get anything like the plan he announced on Thursday through Congress, he will set America on a fundamentally new course.


Whatever else it is, President Obama’s budget is a political gamble of the first order.

In his ambition to put his own stamp on liberalism and to move domestic policy leftward, Mr. Obama has much going for him.

The nation seems to be yearning for leadership, and his political standing is strong. In an era where taxpayers and markets are confronting bad numbers in the trillions, the price tags on some of his initiatives do not seem quite so breathtaking, and, in any case, good economic policy demands that the fiscal floodgates remain open for a while. Populist anger could render Republican arguments against taxing the rich less powerful.

But Mr. Obama faces many constraints. He is asking Congress to take on a wide-ranging set of complicated issues all at once, after years during which it had trouble grappling directly with almost any of them. His own party remains seared by the last time it followed a new Democratic president on a course of tax increases and ambitious social engineering. Interest groups, while demonized by the White House, have hardly fled from Washington and are already mobilizing for battles that could have big winners and losers.

So yeah, Obama's throwing long. Universal health care, cap and trade on carbon emissions, shifting the tax burden toward the rich, etc., etc. If he can get anything resembling this budget passed it will be huge. I also think they've learned not to negotiate with themselves, as the saying goes. They've laid out what they want to see, and if Republicans want to use their votes as leverage to make certain changes, so be it. But they're not trying to build in concessions to the right before the negotiations have even begun.

Newsday says the proposal is notable for treating us like adults:

President Barack Obama gambled big Thursday when he unveiled his first budget. He treated taxpayers like grown-ups. His extraordinary candor about what Washington spends, and what he thinks it will cost to get the economy out of the tank and on course for a sound future, is refreshing.

The figures are huge - $3.6 trillion to be spent in 2010, with almost $1.2 trillion of it to be borrowed. And the spending plan signals a sharp, maybe even historic, change of direction on taxes and the role of government. By baldly laying his cards on the table, Obama is betting that the public can handle the truth. It needs to.

The economy is in a tailspin. It contracted at a 6.2 percent pace in the last three months of 2008, the Commerce Department reported Friday - its worst performance in decades. The White House announced the same day that it will take a 36-percent stake in Citigroup. Those are ominous reminders that the nation has critical decisions to make in order to turn things around. Obama's truth in budgeting will help to make them informed ones.

First, he ditched Washington-style budget sleight-of-hand and honestly laid out what the government will actually spend. It has been common for presidents from both parties to employ gimmicks to make their choices appear more palatable.

Obama explicitly rejected some of the more egregious budgeting practices of his immediate predecessor. President George W. Bush never included the cost of the wars in Iraq and Afghanistan in his budgets, for instance, opting instead to treat those military campaigns as emergencies and fund them off the books. He took a similar approach with the entirely predictable $60 billion it cost the Treasury for each year that Congress spared 20 million taxpayers the expensive bite of the alternative minimum tax. Bush also budgeted nothing for federal disaster response, though natural disasters invariably occur. Obama included all three things in his 10-year budget.

Next, he made it clear that laying the groundwork for a strong economy down the road won't be free. Want to kick fossil fuels for a green future? How about reforming how we pay for health care, so we can get more for our dollars and reduce the ranks of the uninsured? Want to keep Medicare solvent? Get a bigger federal contribution for our schools? Repair and maintain roads, bridges, airports and mass transit? Build a modern energy grid?

It will all cost money, a fact Obama didn't sugarcoat. He budgeted funds as a down payment for those priorities. And he proposed taxes and identified savings to help cover the tab.

The message to taxpayers and Capitol Hill? Quit the magical thinking. These things won't pay for themselves. And we can't just continue to borrow and spend and pass the bill to our kids.

We can argue about the larger role for government that Obama envisions for the nation. And we can argue about whether high earners should pay higher taxes. But by putting his ideas into budgetary black-and-white, Obama has challenged taxpayers to make realistic choices about what they want from government - and then to pay for it.

It's what grown-ups do.

So the next order of business is trying to get this thing passed. Expect at least a month of debate before Congress starts voting. It's going to be clash of the Titans in Washington as every interest group and it's mother comes out of the woodwork to fight tooth and nail one way or the other. The consequences of this debate will likely reverberate for the rest of our lives.

Here's some good news and some bad news:

As this WSJ article notes, the voting rules work a bit differently for budgets than other items: The fillibuster can't be used, so you just need 50+ votes.

Now for the bad news: the Byrd rule.

The obvious and most tantalizing option for congressional Democrats for moving Obama’s agenda is the budget process known as reconciliation. Under this system, legislation that affects tax revenue and mandatory spending needs only 51 votes to pass the Senate, meaning it negates the threat of filibusters.

But moving either the emissions cap-and-trade legislation or a health care overhaul through this process wouldn’t be easy either, because of what is known as the Byrd rule. Named for Democratic Sen. Robert C. Byrd of West Virginia, the rule allows policy language that has no effect on spending or revenue to be struck from reconciliation bills when they come to the floor.

It takes 60 votes to waive the point of order, meaning that if Senate Republicans stay unified, they could blow holes through any reconciliation bill that attempts to implement new policies.

So the fillibuster rears it's head after all. This also complicates Obama's efforts to pay for tax cuts with revenue from cap and trade, if that has to be considered in a separate bill.

I agree with this guy that it's time Harry Reid made Republicans actually fillibuster if it's so damn important to them. Let's let everybody see where everybody stands.