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Monthly Archives: July 2011


July 31st, 2011 - 11:36 am

…Harry Reid just voted no on his own bill, killing the latest compromise.

UPDATE: Doug Mataconis chimed in to correct me and clarify the vote. “Voting no on cloture allows Reid to bring the bill back up and amend it when a final deal is reached, that’s why he did it.”

I’ve said it before and I’ll say it again: Senate rules are haaaaard.

Thanks, Doug.

Hope You Like Your Little Tiny Tent

July 31st, 2011 - 10:17 am

What Roger said:

I cannot speak for PJM as of yet — it’s the weekend and I’m in a ferry queue in Seattle — but I had to speak out personally in immediate support of my friend Andrew Breitbart regarding GOProud. I too will not be attending CPAC next year unless the ban of this organization is lifted. Frankly I am appalled by the decision of CPAC’s new management and I hope they will rescind as soon as possible. If they don’t, I won’t be there. I urge others to deliver the same message.

I stand with GOProud, too. CPAC’s decision — and they’ve been toying with giving GOProud the boot for a year or two — smacks of simple bigotry.

Shame on them.

UPDATE: Charlie Martin adds his support, too. Good on ya, my friend.

How to cure fake cancer, why we don’t have a deficit problem, and the happiest-ever scary-ass chart — all on another exciting episode of… The Week in Blogs!

Bonus: Keep drinking the scotch or die.

On the Dotty Line

July 30th, 2011 - 10:15 pm

ABC’s Jon Karl:

ABC News has learned that Republicans and the White House have struck a tentative deal to raise the debt ceiling before the Aug. 2 deadline. It’s not done yet, but here is the framework of the tentative deal they have worked out, according to a source familiar with the negotiations:

•Debt ceiling increase of up to $2.8 trillion
•Spending cuts of roughly $1 trillion
•Vote on the Balanced Budget Amendment
•Special committee to recommend cuts of $1.8 trillion (or whatever it takes to add up to the total of the debt ceiling increase)
Committee must make recommendations before Thanksgiving recess
•If Congress does not approve those cuts by late December, automatic across-the-board cuts go into effect, including cuts to Defense and Medicare.

A senior White House aide pushed back against the idea that a deal was struck.

This is not a good deal. But it is almost certainly the best doable deal. And if the across-the-board cuts can be made to stick, that would be preferable to another round of endless/fruitless/drama-queenatic horse-trading.

If Boehner can whip his caucus into line, there’s not a hemophiliac’s chance at a vampire convention that the President won’t sign it — no matter how he might protest tonight.

Denial is also a River in Egypt

July 30th, 2011 - 7:09 am

Did you read about the big demonstration in Egypt the other day? Did you read about this part:

Busloads of devout Muslims from around the country swelled the crowd and chanted for the establishment of Islamic Sharia law in Egypt. Transportation for the demonstrators was arranged by several Islamist political groups that are eager to assert their influence after being largely sidelined during the revolution.

Meanwhile, Hosni Mubarak is refusing food. I don’t feel much like eating, either.

Friday Night Videos

July 29th, 2011 - 7:23 pm
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David Bowie, “Rebel Rebel,” re-imagined for his 2004 Reality tour.

Posted Without Comment

July 29th, 2011 - 3:15 pm
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One of those not-so-insidery Microsoft videos.

Required Reading

July 29th, 2011 - 2:06 pm

Austin Bay:

In April of this year, it was already apparent that the Libyan War of 2011 had become a curious war of military, economic and political attrition. That was cruel news then, and remains so today.

All war is cruel. Long, indecisive wars are just plain sadistic. If President Obama had led from the front, instead of from his behind, this thing would have been over — and won — in days, not weeks or months. No war is waged perfectly, but this war is barely being waged at all.

Anyway, Austin was — and remains — more enthusiastic and hopeful than I was about this whole misadventure. But do read the whole thing.

Chinese Growth Runs Off the Rails

July 29th, 2011 - 12:32 pm

Forget that grisly accident for the moment and ask if China has built a high-speed train to nowhere. Looks like it:

The funding of this grand ambition is beginning to look increasingly shaky too. Financially, the project has already effectively broken the Ministry of Railways. At the last count, the ministry was nearly 2 trillion yuan (£200bn) in debt and clocking up losses at the rate of about £400m a quarter. On any Western definition, the ministry is completely bust. To meet the plan, another 2.8 trillion yuan has to be found in the next three and half years. Where’s the money going to come from?

In recent debt issues, the railway has had to pay way above the going rate of interest, despite the fact that its bonds are implicitly and in some cases explicitly underwritten by the state. Of equal concern is that the newly opened links have failed to achieve anywhere near expected traffic levels. In the West, they would be dubbed a massive white elephant.

Actually, we call it “winning the future.”

A Principled Stand in the Wilderness

July 29th, 2011 - 11:11 am

Stupidity should hurt, and Ohio Congressman Jim Jordan has been pretty stupid — practically and politically. So here’s his pain:

Jim Jordan’s open defiance of Speaker John Boehner’s efforts to solve the debt-ceiling crisis could cost the Urbana Republican his safe House seat in next year’s election.

Two Republican sources deeply involved in configuring new Ohio congressional districts confirmed to The Dispatch today that Jordan’s disloyalty to Boehner has put him in jeopardy of being zeroed out of a district.

“Jim Jordan’s boneheadedness has kind of informed everybody’s thinking,” said one of the sources, both of whom spoke only on condition of anonymity. “The easiest option for everybody has presented itself.”

Jordan’s rural 11-county district, which has a 60 percent Republican voter index, “is easy to cannibalize because it stretches so far,” the other source said.

I once nearly talked myself out of a job I loved very much — when I was 21 and careless. Jordan is old enough to know better.

Steve Jobs Could Buy US Out

July 29th, 2011 - 9:20 am

Apple has more cash on hand than the United States government. Of course, Apple sells products people like and pay for willingly.

Oh, and Apple spends less than it takes in, too. Makes a big difference.

I’m not sure just how many times back in ’09 I said Obamanomics would fail, but that doesn’t make it any less miserable to report on the misery. See the latest:

The U.S. economy came perilously close to flat-lining in the first quarter and grew at a meager 1.3 percent annual rate in the April-June period as consumer spending barely rose.

The Commerce Department data on Friday also showed the current lull in the economy began earlier than had been thought, with the growth losing steam late last year. [Emphasis added]

That’s right — the economy slowed down before the Japan earthquake disrupted so many supply chains, and before gas prices shot up. Reuters won’t spell that out for you, but they all-but-admit-it in the next graf:

That could raise questions on the long held view by both Federal Reserve officials and independent economists that the slowdown in growth as the year started was largely the result of transitory factors.

Obamacare is not a “transitory factor.” Neither is $14.4 trillion in debt. Demonizing business, using the tax code to discourage entrepreneurship, strangling domestic energy production, regulatory bloat, an anti-industrial EPA, using extra-legal means to prop up spiteful unions — these might be transitory factors, but they’re as good as permanent until we get a new President.

And the results are painful to see:

Growth in gross domestic product — a measure of all goods and services produced within U.S. borders – rose at a 1.3 percent annual rate. First-quarter output was sharply revised down to a 0.4 percent pace from a 1.9 percent increase.

Economists had expected the economy to expand at a 1.8 percent rate in the second quarter. Fourth-quarter growth was revised to a 2.3 percent rate from 3.1 percent.

Jobless claims and unemployment figures — those get revised up every few weeks. The economy as a whole? Down, down, down.

What amazes me, however, is there’s still enough of that American can-do spirit to keep this economy chugging along even a little bit. But the fact that we still have some small, tiny, modest, meager growth is due to no lack of trying by this rotten and clueless Administration.

An Open Letter

July 29th, 2011 - 5:11 am

Dear Tea Party Republicans,

I’ve been with you from the start. One of the very first Tea Party rallies — a scant 70 or so attendees — was on the Capitol building steps in Denver, here in the state I’ve called home for even longer than I’ve actually lived here. At that moment, I was attending CPAC in Washington, and when I heard the news I thought, “I’m in the wrong place. I should be there, not here.”

That’s what I want you to know, before I say what I’m about to say.

Fake spending cuts are better than fake spending cuts paired with genuine tax hikes.

Do you get that? We don’t — yet — have the numbers to produce real reform in Washington. To do that, we must capture the Senate and the White House next year. And we cannot do those things, we cannot do the things we sent you to Washington to do, if you don’t compromise right now with Harry Reid’s Senate.

I know that’s awful. I know it hurts. But if you screw this up today, there won’t be a tomorrow for you. For us. For this country.

Compromise now, and you’ll put Obama in a box from which it will be very difficult for him to escape. Refuse, and he will box us all up good and tight, then throw the box in the Potomac.

I’ll say it again: Fake spending cuts are better than fake spending cuts paired with genuine tax hikes.

Take the deal. Take it so we can fight another day. Refuse it, and go back to the wilderness.



Game Over for Nintendo?

July 28th, 2011 - 4:03 pm

Nintendo is slashing $80 off the price of its 3DS handheld game rig, to undercut the starting $199 price of the iPod touch.

People have written off Nintendo before. This is a company that just gets gaming. But the market they invented changed dramatically and quickly — can they recover one more time?

Harry Reid is Dr. No

July 28th, 2011 - 3:38 pm

We’ve gone from Cap, Cut & Balance on the House side of Capitol Hill, to Parry, Squash & Demagogue in the Senate:

House Speaker John Boehner’s plan to raise the debt limit and reduce the deficit will be quickly defeated tonight, Senate Majority Leader Harry Reid said today.

The Republican-led House will vote on Boehner’s plan in the late afternoon. It’s unclear whether the speaker will have enough support in his caucus to pass the measure, which would increase the U.S. borrowing limit by up to $900 billion while cutting more than $900 billion in spending over the next decade.

With one Democrat out for health reasons today, Boehner needs 216 votes to pass his bill and can afford to lose 24 Republicans. In the early afternoon, CBS News tallied at least 17 Republicans who will vote against it and nine who are leaning against it. Fifty were undecided.

If the bill does pass, Reid said today he would take it to the Senate floor for a vote immediately — where the Democratic majority will reject it.

Reid has yet to call for a vote on his own plan, which remains a puzzle inside a riddle wrapped in empty promises.

Why does China hold so much of our debt? That’s an excellent question, and I’m glad I asked it. Here’s Stephen S. Roach:

China is no innocent bystander in America’s race to the abyss. In the aftermath of the Asian financial crisis of the late 1990’s, China amassed some $3.2 trillion in foreign-exchange reserves in order to insulate its system from external shocks. Fully two-thirds of that total – around $2 trillion – is invested in dollar-based assets, largely US Treasuries and agency securities (i.e., Fannie Mae and Freddie Mac). As a result, China surpassed Japan in late 2008 as the largest foreign holder of US financial assets.

Not only did China feel secure in placing such a large bet on the once relatively riskless components of the world’s reserve currency, but its exchange-rate policy left it little choice. In order to maintain a tight relationship between the renminbi and the dollar, China had to recycle a disproportionate share of its foreign-exchange reserves into dollar-based assets.

Get that? Beijing keeps the renminbi weak by trading all the dollars we send them for US securities. That keeps the demand for the dollar up and demand for the renminbi low. But you probably already knew that. What you might not know is this next bit:

Those days are over. China recognizes that it no longer makes sense to stay with its current growth strategy – one that relies heavily on a combination of exports and a massive buffer of dollar-denominated foreign-exchange reserves.

China has hit a wall: Slumping demand. American consumers are tapped out, and likely to stay that way for some time. Exports are no longer China’s path to riches; now they’ll have to depend on Chinese consumers.

Which means China’s appetite for US debt is about to shrink — regardless of what we do with our budget. We could raise the debt ceiling tomorrow, we could pass a balanced budget amendment the day after that, we could put our nation’s finances on a sound glide path to solvency over the next few years –

– and China still won’t be buying our debt at firesale prices.

We’re sitting on $14.4 trillion in obligations. We’re about to jack that up to $17 trillion, even if Cut, Cap & Balance becomes law right now.

Those $17 trillions we owe, most of it rolls over every few years. It’s mostly short-term obligations. Right now, the vig is about $200 billion each year, at the abnormally-low interest rates China has been willing to accept to feed their export-growth engine.

If Roach is right, if China isn’t going to be the buyer it once was, then who’s going to re-fi our existing debt, and at what price?

And I can’t emphasize this one enough: I’ve outlined the rosy scenario here. It is 99% certain that things will be much, much worse.

Memo to Ford Motor: Duck

July 28th, 2011 - 1:03 pm

The UAW is playing all lovely-dovy with Government Motors, but wait until you see what’s coming next. Peter De Lorenzo knows the score:

Don’t buy a damn thing that Bob King says, because he speaks with forked tongue.

And while Chrysler and GM may benefit from the Shiny Happy kumbaya version of Bob King and the UAW – while bolstered by a “no strike” clause as a result of the bankruptcy agreements, no less – Ford is going to bear the brunt of the real true UAW. The relentlessly difficult, badgering, yester-tech UAW. The one that’s going to remind everyone of the UAW’s Dark Side and the belligerent entity that saw its heyday 40 years ago, overnight.

And it’s going to get ugly, folks. Really, really u-g-l-y.

Thanks to great management, Ford made it through the Great Recession without an Obama-approved phony-baloney bankruptcy. And don’t think Ford won’t be made to suffer for it.

Too Big to Breathe

July 28th, 2011 - 11:20 am

We never learn. We never, ever learn that you don’t get rich by destroying wealth. We tried it for a decade in the ’30s — and turned a market panic into a Great Depression. We’re trying it now, with similar results. And we’re so bloody-minded to do it, even the private sector is pitching in. Read:

Bank of America Corp., faced with a glut of foreclosed and abandoned houses it can’t sell, has a new tool to get rid of the most decrepit ones: a bulldozer.

The biggest U.S. mortgage servicer will donate 100 foreclosed houses in the Cleveland area and in some cases contribute to their demolition in partnership with a local agency that manages blighted property. The bank has similar plans in Detroit and Chicago, with more cities to come, and Wells Fargo & Co., Citigroup Inc., JPMorgan Chase & Co. and Fannie Mae are conducting or considering their own programs.

Disposing of repossessed homes is one of the biggest headaches for lenders in the U.S., where 1,679,125 houses, or one in every 77, were in some stage of foreclosure as of June, according to research firm RealtyTrac Inc. of Irvine, California. The prospect of those properties flooding the market has depressed prices and driven off buyers concerned that housing values will keep dropping.

“There is way too much supply,” said Gus Frangos, president of the Cleveland-based Cuyahoga County Land Reutilization Corp., which works with lenders, government officials and homeowners to salvage vacant homes. “The best thing we can do to stabilize the market is to get the garbage off.”

People are broke. And the way we’re going to fix that is to raise home prices by knocking down perfectly good ones.

Listen up. This market won’t find a bottom until it finds a bottom. And it can’t do that so long as we’re doing everything we can think of to prop it up.

This market could have cleared a year ago, maybe two, if only the market had been allowed to work. I used to blame Washington. But now I blame Washington and BofA.

Trifecta: Obama wants us to believe that borrowing in excess of the current debt ceiling is the responsible path. Sound insane? Will Atlas Shrugged become our future? Is it time for Obama to just get out of the way?

Trifecta: Jeff Jarvis started the “F-U Washington” craze — but Scott and Bill and I aim to finish it.

Bonus: It’s safe for work! Really.

It’s a Clip Show Spectacular

July 26th, 2011 - 12:59 pm

Trifecta: Downgrading Obama — when in doubt about debt, blame Bush, blame the rich, and avoid responsibility.

“Kiss my astroturf!”

July 26th, 2011 - 8:42 am

Coast to Coast Tea Party: Meet Jamie Radtke, the Virginia mom who’s going after RINO George Allen in the GOP race for the Senate.

Seventeen to One? Never Tell Me the Odds!

July 26th, 2011 - 5:16 am

James Fallows knows what’s wrong with America’s finances:

It’s based on data from the Congressional Budget Office and the Center on Budget and Policy Priorities. Its significance is not partisan (who’s “to blame” for the deficit) but intellectual. It demonstrates the utter incoherence of being very concerned about a structural federal deficit but ruling out of consideration the policy that was largest single contributor to that deficit, namely the Bush-era tax cuts.

Restoring the Clinton rates on “the rich” is already assumed in President Obama’s last budget, which would raise a trillion dollars in additional revenue over the next ten years. Also included in Obama’s budget over the next decade, is $17 trillion in additional debt.

Repeat after me: Taxes are not the problem here.

Hat tip, Gruber, who has, unfortunately, drunk the Kool-Aid on this one.

Programing Note

July 25th, 2011 - 6:22 pm

Sorry, but I can’t drunkblog the President’s pretend-major address tonight, in which he will reveal that the Republican plan is far inferior to his plan, because his plan provides tax cuts for everyone but evil successful people and increased entitlements and trillion dollar surpluses as far as the eye can see.

However, Obama’s plan is also hidden in a secret location, and must remain there or else the evil Republican plan will eat it and poop it out on poor people’s heads.

At least that’s the gist of what the President will say here shortly.

But I won’t be watching, because I’m enjoying a very nice Chianti before getting down to the serious business of Build Your Own Pizza night here at Casa Verde.

I do promise to watch it in reruns tomorrow morning, shortly before eviscerating it on a Very Special Trifecta.

Meanwhile, over at the Seattle Times, Brier Dudley explains how the iPad causes inflation.

Hair of the Dog: Welcome to the Great Goat Rodeo Debt Negotiations, where the Speaker is fuming, Obama is AWOL and the press is pliant.

Bonus: Guess who puts the Urrr in “journalist.”

Reid Epstein: Hack

July 25th, 2011 - 2:19 pm

Oh, Politico, you do find ways to amuse us so:

King is among the House Republicans who voted for the so-called “Cut, Cap and Balance” plan that would introduce a constitutional amendment to require a balanced budget. The Senate last week dismissed the House bill.

That’s the third graf from Epstein’s story on Steve King’s Twitter antics this morning. But why the scare quotes around “Cut, Cap and Balance?” It’s called Cut, Cap and Balance. It seems “Reid” wants his “reporting” to trivialize the House-passed measure in his “newspaper,” without ever telling you what’s in it.

That’s your Washington Steno Pool, hard at work protecting Democratic interests since 1933.

ESA to Sacramento: Pay Up

July 25th, 2011 - 12:42 pm

I hope they win:

The Supreme Court gave video games protection under the First Amendment in its ruling against California’s gaming legislation, setting a precedent that should deter other politicians from trying to pass similar laws. The Entertainment Software Association isn’t finished, however, and it has filed a motion to be reimbursed $1.1 million in attorney’s fees from the state of California.

It would be even nicer if individual lawmakers could be held accountable for damages for their stupid laws. I suspect we’d have far fewer stupid laws.

Is Reid’s Debt Deal as Good as It Gets?

July 25th, 2011 - 10:52 am

Harry Reid has produced $2.7 trillion in cuts without tax increases, presumably with a hike in the debt ceiling of about $2.5 trillion — enough to take us past the election. Barring something “unexpected,” of course.

If Boehner takes this — and he should, if only for operational reasons — it puts the GOP in a very good position for 2012. A House-Senate deal also pulls the rug out from under the President’s attempt at triangulation. There’s no room for a third point off of a straight line.

Will the President sign it?

It does meet his inflexible demand for a “big deal” to take us into 2013. It does not meet his insistence for tax increases. If he signs it, Obama will prove once and for all that he’s been the major impediment to a deal — although he’ll certainly demand credit, anyway. If he doesn’t sign it, he tanks what’s left of the economy.

Not a bad weekend’s work, Mr. Speaker.

So unless Reid has booby-trapped this thing somehow, then the House should approve it and await the President’s signature.

What Do You Do With a Drunken Driver?

July 25th, 2011 - 10:43 am

There is something deeply wrong with our justice system:

Marietta mother Raquel Nelson–who lost her 4-year-old son when a car ran into him as she was headed home from the bus stop with her three children–may face up to two and half years in prison for jaywalking.

The Huffington Post’s Radley Balko points out that Nelson may serve six times as many months in prison as the man who ran over her family and drove off.

That man, Jerry Guy, admitted he had been drinking and taking prescribed painkillers the night of the accident, and had been convicted in two earlier hit-and-runs. He served six months in jail for the crime.

Words fail.