Good Friday means the markets are closed and thus it is a slow news day. But, as I cracked open my Wall Street Journal, I came across an interesting op-ed piece written by Michael Pereira on solutions for making the bank rescue plan a success. In his piece, Mr. Pereira outlines some of the key concerns that investors have in regards to the Public-Private Investment Programme, and although he attempts to explain how the plan theoretically addresses those concerns, I am afraid the main message that I (and no doubt many readers) walk away with is just that many concerns remain, with no real long-term solutions in sight.
Is Lack of Experience Becoming a Mantra?
Although I have not supported Barack Obama, I’ve been committed to actually contributing to the process, instead of being bitter, because what’s done is done. As such, I’m really trying to get behind what President-elect Obama is doing. I’ve supported some of his economic appointments and I think he’s truly making an effort. Also, I think there’s so much potential for this incoming Administration. However, after hearing the news yesterday that the Obama Transition Team is likely going to appoint Leon Panetta as the Director of the Central Intelligence Agency, I know that I cannot stand by and support this.
First of all, I don’t know who’s idea it initially was to name Panetta as CIA chief, but I can’t imagine it was someone with firsthand experience in intelligence or national security. The evidence for this came today when anyone and everyone with knowledge of the US Intelligence Community voiced their disappointment of the news. They weren’t alone either; many Congressional Democrats, including Democratic Senator Diane Feinstein also voiced their disapproval of appointing a politician to a national security post.
2008: The Year of Great Humility
From the diaries, by Erick.
As I was thinking about looking back at 2008 and all of the events that have gone on around the world this year, one word came to mind: humility. Bear with me while I explain this, because it might be easy to miss what I’m saying. When I say “humility,” I’m not thinking about how those the world watched most this year exhibited great humility. Instead, I am using this term in the sense that what the world watched was some of the most notoriously powerful, prestigious, glamorous and notable people were humbled, one after another. So, I believe 2008 should be known as the “Year of Great Humility,” where so many people became too big for their britches to the point where the year will mark a time of fundamental change in the way many components of our world and society function. Let’s look at how the most changing and humbling events unfolded.
Obama’s First Distraction
As President-elect Obama is beginning to dig in to real work of a President, he experienced his first real shot of political humility today. While many Obama fans moved quickly to claim their certainty about the former-Illinois Senator’s involvement with Governor Blagojevich’s attempts to sell the vacant Senate seat, this event has increased the level of uncertainty about Mr. Obama’s true ability to lead the country in what is a very difficult and challenging time.
But, rest assure, Mr. Obama is not sifting through this scandal without allies. He has his always ready army of reporters, which some refer to as the mainstream media, who are ready to defend Obama’s abilities to walk on water, and attack anyone who claims otherwise. In their attempts to act impartial, the AP made an effort to come across like true journalists, while in the midst of defending the President-elect’s name at every turn. I really enjoyed the Weekly Standard’s analysis of the AP’s ‘reporting’ (term used loosely) on the situation.
Ok, so I’m having some fun with this. In reality, this situation isn’t going to hurt President-elect Obama much at all. Republicans will no doubt use it, but it will most likely be long forgotten in a few months. I seriously doubt any real connection will be made between Obama and Blagojevich. The real challenge for Team Obama come re-election time will be anything else the redeveloping GOP research machine might uncover about Barack Obama’s time in one of the most corrupt politicall environments outside sub-Saharan Africa.
The reality is that no one can rise through the Chicago political scene without doing some things that even the most skilled politician might term as “questionable.” What’s most interesting about the whole thing is that no one there attempts to hide anything. This actually lends an explanation to the question of how Blagojevich could have been so naive as to think no one would ever find out about his efforts to openly sell the open Senate seat to the highest bidder. At first, I assumed the Governor was just really dumb; however, as I emerged further into the situation’s analysis, it donned on me that he just suffered from the illness of all Illinois politicians – he thought he was untouchable. And, the GOP won’t hesitate to intervene as Eliot Ness and Jim Malone, with cool Sean Connery accent and all.
So, what will the fallout be for the Obama-Biden Administration? Well, first things first, Mr. Obama can ask his Vice President, who has considerable experience distancing himself from embarrasing scandals. Overall, I doubt the Transition Team is all that concerned with this issue. They will manage it on the PR front, but that’s about it. I have no doubt the response will be something along the lines of, “President-elect Obama had no involvement in the events leading to the arrest of Gov. Blagojevich, and going forward, he would like to focus on resolving the economic and financial crisis that is on the minds of most Americans.” The incoming White House will likely say nothing more than that on the issue, nor should they.
This doesn’t mean there won’t be any fallout for Mr. Obama. He is about to face a great deal of struggles and his first term will not be a breaze by any means. Indeed, I have talked before how the challenges he will face may very likely chip away at his untarnished reputation, to the point of the American voting public turning on him when he inevitably fails on some of his promises. And, this is not a shot at Barack Obama’s ability – I am simply saying that the challenges the country face cannot be solved in a short time or by one individual, regardless of what that is or what political party they represent. John McCain would experience the same problem, to the point that I would seriously doubt the ability of McCain to have been re-elected if he won the election. George Bush couldn’t solve them. Even Ronald Reagan didn’t receive his superstar status until well after his Presidency (or at least towards the end of it).
What I am saying here is that four years won’t be enough to solve all of the challenges we’re facing, which include a major recession, insolvency in the financial markets, two major wars, significant domestic issues (immigration, healthcare, etc) and serious national security threats. The best the incoming President can hope for is to keep up a positive sentiment long enough to get him into a second term, because there will be a lot of disappointed Americans when they realize that those promises from President-elect Obama were never possible in the first place.
Start Acting Like a President
Because you work for me now
From the diaries by Erick.
This isn’t a post bashing President-elect Barack Obama or Democrats. This is a recommendation to the new incoming Administration and all Americans out there supporting it. The President-elect is no longer a candidate; he will be taking residence in he White House in a few short weeks. Yes, history will be made when he does this, but history will also be made by the unprecedented crises our country is facing, which Mr. Obama will have to address from day one. Indeed, he’s already starting to work on the plan, which I give him credit for, and I commend him for his picks on the economic team that will be driving economic policy in the new Administration. What did not impress me, though, was the manner in which Mr. Obama is still acting more like a candidate and less like a President.
New Captain at the Helm of American Healthcare
Driving our system off the cliff
As all major news outlets are reporting , former Senator Tom Daschle has accepted an offer from President-elect Barack Obama for the post of Health and Human Services Secretary. While most people were aware that Daschle was on the short list for the job, the healthcare industry at large is not responding well to the fact that he actually got the post.
One Man
Getting our focus straight on moving forward
I was having a conversation about the election yesterday with a close friend who I respect and value deeply. He is an Obama supporter and of course, he knew I am a conservative, GOP supporter, and thus voted for John McCain. We got to talking about some of the stereotypes associated with voters from certain backgrounds and how the changing dynamic in this election was completely different from what we usually see, or at least different from previous elections.
Is Bureaucracy the Right Prescription?
A case study on how to regulate the markets to death
This afternoon on Bloomberg Radio, Charlie Stein talked with Laurence Kotlikoff, professor at Boston University and President of Economic Security Planning Inc. The discussion was primarily framed around an article that Dr. Kotlikoff penned for Bloomberg yesterday, where he introduces his recommendation for a medium-term solution to ensuring “safe” assets make it to the markets, rather than the toxic ones that have gotten us where we are today.
Folding the TARP: Analysis of Treasury’s Changes to the Plan
Why fiscal stabilization will not be sustainable
Clearly the market isn’t too excited about Hank Paulson’s announcement from this morning that they will be changing the direction of how the funds under the TARP will be used. No shocker there, right? As you can see by the big bold headline from the Financial Times’, the US Dep’t of Treasury has decided to not use TARP funds to purchase toxic assets. Instead, the $700 billion will be targeted recapitalization programmes, specifically focusing on “markets that securitize consumer credit.”
Request for Proposal: Major Turnaround and Re-organization
Tendering Organization: The Republican Party
This is a look at tactical turnaround strategies for the GOP from the perspective of a management consultant and private equity professional. In today’s marketplace, the turnaround business is growing quickly. Many companies are facing re-organization processes, financial and debt restructuring, and full-scale operational turnarounds, in efforts to implement efficiencies and stay alive through the downturn. The Republican Party must also face a turnaround, one of drastic proporations, like never done before. The following is some of my suggestions on how to approach this.
Proud American … Still. Always.
No Fair-Weather Patriotism From This American
This country is the best place on earth for so many reasons, but one of my favorites is that the strength of our people will always persevere through anything that the world may throw at us. Terrorist attacks? We’ll come back stronger. Recession? We’ll build a better economy. War? We’ll win and live on. Nothing is going to stop this country from being the best in the world. Not Barrack Obama and not George W. Bush. But, for this reason, I have been very disappointed to hear some comments from a number of Obama supporters and Democrats in general today.
Postmortem: POTUS ’08
What the hell have we done?
It is finally done. There were no real surprises from a political standpoint. All of the surprises are related to the entire process in general. The manner in which this race has evolved over the past two years is unconventional, to say the least. Every campaign cycle, pundits and media commentators talk about how this one is different and will be like never before, and then when it’s all said and done, it’s the same as always. This time, however, it really was different in a variety of ways. Here’s a brief look back, but more importantly, it’s time to look forward.
Influencing Economic Expectations, Redux
In Need Of A Word From Bernanke
Earlier this week, I posted an article (on my blog and here at Redstate ) that voiced one of my main criticisms of monetary policymakers throughout the efforts to pass the Paulson rescue package. This is not an armchair criticism; this is a complaint, based on insufficient management of a fundamental approach to monetary policy.
The Rescue, Part II
Digesting the Impact and Moving Forward
As expected, the ‘rescue package’ legislation was approved this afternoon by the House, after being previously approved by the Senate on Wednesday. Despite the previous failure of the bill and many people here at Redstate saying the package wouldn’t be approved, we’ve now taken at least one step in the right direction, so that we can continue moving forward with further efforts to really relieve the economy from the crisis we’re facing.
Influencing Economic Expectations
Looking at the Crisis from the Other Side of the Coin
If you have been following my articles , I have strongly advocated that the Congress approve the rescue plan proposed by Hank Paulson and Ben Bernanke. I won’t rehash all of the reasons why I think this must happen, but suffice to say, our financial system needs liquidity to be stabilized and that’s what this bailout is all about. You can read my other previous comments around the political ramifications, as well as responses to some of the claims by the opponents in this situation. But, now it appears the bailout could happen, and indeed, I think it will. The Senate approved the bill last night, and assuming the House doesn’t get caught up chasing their tales like they normally do, then hopefully we can start moving forward with resolving this crisis by the week’s end.
The Rescue
Version 2.0
Last night, the Senate approved the revised bill that implements the proposed plan to bailout (read ‘rescue’) the financial markets after an already long week and painfully drawn out past couple of weeks. Now, the bill will move on to the House for more political butchering of policy that is already late and less than top-notch quality.
The Other Bailout
While Congress Was Politicking the Economy to Death
A bounce in the markets yesterday was not unexpected after the day we had Tuesday, but many people were surprised to see the Dow jump 400 points. Many people chalked this up to the idea that the markets were already recovering from the plunge after the bailout was rejected, but this is because the majority of people didn’t realize fundamentally why the increases happened.
Financial Crisis for Dummies
A primer on how we got where we are today
For all of those still struggling to understand the financial crisis, and how all of this happened, here is an illustrative description that might help you get a better grasp on how we got to where we are today. Then, let’s talk about who’s to blame.
NOTE: I did not create it, but I wish I had. I’m not sure who created it, otherwise I would have to give them credit for this genious work.
Blame Game
Now's as good a time as any
I guess now is just as good a time as any to start this, especially as I have been hearing a lot of people throw around blame to a lot of different targets, yet I think some of the most deserving of the blame are going unnoticed. I’m really not trying to point fingers here, but as everyone wants to be a Monday morning quarterback, thinking blaming all kinds of different people for the economic crisis, it’s really getting to the point of calling the kettle a little too black.
A Few More Points to Consider
Responding to the discussion
Erick brought up a very pertinent discussion about the crisis emerging after today’s failed vote on the bailout package, in which he outlines a few points for readers to consider. I am not disagreeing with him, but I think the points require some further consideration. As such, I commented on some of these in the original post, but some had recommended to outline these items in a separate post, which I am doing below. Please bear with me on some redundancies, but I believe these points are incredibly important for us all to keep in mind as we watch what happens next in this crisis.
Moe Lane
Dan McLaughlin
Dan Spencer
Jeff Emanuel
Neil Stevens
