Category: Economics

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Domestic issues Economics Election 2008 Foreign Policy McCain Obama Politics The Opinionsphere

Why I Am Still Confident About Obama’s Campaign

[digg-reddit-me]Drudge has the scare headline up today. And pundits across the world are speculating about why Obama hasn’t blown McCain away yet. Yet I’m still confident in Obama’s campaign.

One of my first blog posts – and my first blog post to gain a sizeable readership – ran last October 12 when Obama was trailing Hillary by sizable margins and was entitled: “Why I Am Confident About Obama.”

My conclusion – despite the media’s almost universal consensus that no one could take down the Clinton juggernaut at that late date (with a 20 point lead nationwide and a slim lead for Clinton in Iowa) – was:

Clintonian hubris, an Obama strategy to put the pressure on Clinton late, with Iowa in a statistical dead heat, and a ton of other primaries following hard-upon Iowa.  It seems to me that Obama has a good chance of winning even if he doesn’t hit his stride.

The overall perception driving me to this conclusion was that Obama was the natural candidate for this time – that his candidacy and person fit the moment in a way no other candidate’s did. George F. Will, among a few other astute observers of American politics, saw this too. Obama was the candidate that fit the times – and he had a smart and hard-nosed plan for getting the nomination from Hillary and the presidency from any Republican. The intellectual ferment, the grassroots enthusiasm, and the international support for Obama all confirm that he is the candidate of the zeitgeist.

These fundamentals have not changed.

Which is why, now, with McCain ahead of Obama by five points nationally (the first lead he has had against the presumptive Democratic nominee) and with McCain outspending Obama in many key states, and with many media supporters of Obama beginning to panic and conservatives beginning to gloat, and McCain finally finding his voice given the prospect of a war with Russia – I am still confident about the Obama campaign.

  1. I trust the Obama campaign’s game plan. They have run one of the best campaigns in recent memory – they are confident and they have a plan. They beat the feared Clinton machine. And they knew it after Super Tuesday – months before anyone else. They strategized perfectly and executed their plans almost flawlessly. No other campaign this election cycle can say that.
  2. Obama will get more bounce from the Democratic National Convention next week than McCain will get from the Republican National Convention the week after. Why? Because Obama does not have George W. Bush and Dick Cheney speaking at his convention.
  3. Contrary to the “conventional wisdom” of the right-wing opinionsphere, Obama has more to gain from debates with McCain than McCain. Obama’s presence and answers will stand in stark contrast to the terrifying image of “Barack Hussein Obama.” Just as Ronald Reagan did not take a clear lead over incumbent Jimmy Carter until just after their sole debate (in the last week of the campaign) – so Obama will capitalize on his debates. Reagan was running as a change agent light on specifics, high on rhetoric and hope, against a reformer who defended a good deal of the status quo whose party had been blamed for significant foreign policy and economic disasters at a time when most people felt their country was going in the wrong direction. Many people didn’t feel comfortable with Reagan until they saw him stand side-by-side with Carter and felt he seemed reasoanble. The same dynamic seems to be working now.
  4. Obama’s supporters discovered in July and August that he’s not a perfect candidate. He supported the FISA compromise; he explained again that he was in favor of individual gun rights; he reiterated his longstanding support for faith-based programs; he went back on his (slightly hedged) promise to participate in the federal financing program for the general election campaign. They’ve been getting antsy. But with the serious prospect of a McCain presidency, most of those who care about liberal values will discover how much better Obama is than the alterative.
  5. McCain doesn’t do frontrunner well.
  6. Polls are only as good as their turnout models. Obama’s supporters come from those demographics least likely to have a landline – and thus, many of his supporters are not taken into account in polls. Plus, if black Americans and young Americans turn out at higher than predicted levels – given that both groups are extremely energized by the Obama campaign – this could tip the election further.
  7. If McCain is understood to be the frontrunner, his gaffes suddenly take on a new importance – and the media will be much tougher in covering him. Thus far, they’ve treated him with kid gloves – and mainly ignored his negatives (because they’ve been ignoring him altogether.) Where is the Iraq-Pakistan border again, Mr. McCain?
  8. Although McCain is outspending Obama now in some key states, Obama will have far more money down the stretch – and already has a more significant campaign organization in each state than Kerry or Gore did. Right now, he is spending most of his money on creating boots on the ground and campaign infrastructure which he can call on in November to turn out the vote. Once McCain’s spending is restricted, Obama can saturate any market he wants with ads.
  9. Obama’s supporters are more enthusiastic. McCain’s are too old to be enthusiastic, and most don’t like him all that much anyway.
  10. Much of the public still sees McCain as a maverick rather than as someone who “totally supports” Bush on “the transcendent issues” like Iraq. Most of the public does not know that McCain has flip-flopped on torture and on economic policy – and that four more years of McCain promise to be no better than four more years of Bush with regards to the economy.
  11. Finally – and the biggest reason – neither Obama nor his surrogates have started to attack McCain yet. They have local issue ads up in many states already. But the Vice Presidential nominee’s number one job will be to take the fight to McCain. McCain is wide open to attacks on so many fronts –

I trust the Obama campaign has a plan and that they will execute it well. That plan will include hitting McCain hard when he has less money to spare. There’s no guarantee, but Obama’s chances are still very good – and he has been consistently doing better in the polls than Gore or Kerry at similar times in the race. Obama has said that he is in this to win.

I hope so – and I know I will do all I can to ensure that he does.

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Economics Election 2008 Foreign Policy Iran Iraq McCain National Security Obama Politics The War on Terrorism Videos

A President for Our Dangerous Times

[digg-reddit-me]In dangerous times, we cannot let the larger issues out of sight:

The day to day grind of this campaign – months and months of fights over demographics, over gaffes, over lobbyists, over media bias – has distracted most of us from the essential issues at stake.

The essential choice we face is whether or not our country is going in the right direction.

There is an economic component to this – which will rightfully take up much of the country’s attention in the next few months, and between McCain and Obama, the economic differences are stark.

Perhaps more important is the question of whether or not America should embrace it’s current role as an imperial power, as a neo-empire. McCain clearly accepts this view. One of his foreign policy advisors has explicitly accepted the American empire. Another McCain advisor explained how McCain is planning on creating a League of Democracies to destroy the United Nations and marginalize Russia, quite possibly provoking a new Cold War ((N. B. Fareed Zakaria is not an Obama surrogate as this YouTube video claims but a journalist for Newsweek with his own show in PBS.)) . McCain has said that withdrawing from Iraq – which is what the Iraqi prime minister is requesting of us – would be a surrender to our enemies. (He still doesn’t seem to have noticed that many of our enemies are warring amongst themselves – Sunni extremists, Shia extremists, Al Qaeda, Iranian factions.) At the same time, he has threatened war with Iran while claiming it is naive to consider meeting with any Iranian leaders. (McCain never mentions the candlelight vigils in Tehran after September 11 or Iran’s efforts to come to a comprehensive settlement of all issues between America and Iran immediatly afterwards that were ignored using the same justification McCain now uses to avoid dealing with Iran.) Instead, he jokes “Bomb, bomb, bomb, bomb, bomb Iran…)

As Andrew Sullivan wrote:

After the last eight years, we simply cannot risk a continuation of the same reckless, belligerent, argument-losing, ideological and deceptive foreign policy of [the Bush administration.] From his knee-jerk Cold War posture over Georgia to his Rovian campaign tactics, McCain is simply too close to this disastrous record to contemplate… McCain’s trigger-happy temperament, shallow understanding of the complexities and passion for military force as the answer to everything is the bigger risk. He is a recipe for more, wider and far more destructive warfare.

As the conservative curmudgeon George Will explained, invoking Barack Obama’s historic candidacy as a marker:

[I]t illustrates history’s essential promise, which is not serenity – that progress is inevitable – but possibility, which is enough: Things have not always been as they are.

In other words, we can change. We were not always an empire, and we need not always be an empire. We were not always at war, and we do not need to remain at war. Barack Obama will not change anything overnight (we will not all be given bicycles) – because that is not the type of leader he is. He is not a revolutionary urging us to storm the barricades. He is an imperfect leader. He is a sensible pragmatist who believes we are in a unique moment in history in which we have an opportunity to establish meaningful changes by reforming our political, economic, and governmental processes.

The alternative is stark. While I have long been an admirer of John McCain – because he stood up to the President on torture, tax cuts, swiftboating, and global warming – he lost my vote some time ago. He has fought this campaign without honor – ever since his campaign went bankrupt and he began to repudiate every stand he took that hurt him with the Republican base (including on torture, tax cuts, and now apparently, swiftboating.)

In the end, as dire as our economic strength is, this election will be remembered as the the moment when America decided if it was going to remain an empire, or if instead we would return to the best of our traditions, and take our place as a leader in the world community.

In these dangerous times, one candidate poses too great of a risk, and the American people cannot afford to allow a party which has undermined our national security at every turn to remain in power.

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Domestic issues Economics Election 2008 Humor McCain Politics The Opinionsphere

Beware of “Fiscal Conservatives”

Succinctly put by Steven Greenberg of the Ventura County Star.

I would have to say it’s an open question as to whether or not these Republicans are adherents to the “Starve the Beast” strategy or are just pure hypocrites on the matter of fiscal responsibility.

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Domestic issues Economics Election 2008 McCain National Security Obama Videos

Quasi-Defending the Windfall Profits Tax

[digg-reddit-me]A friend of mine wrote to me yesterday regarding his concern about the windfall profits tax that Obama is current proposing for oil companies.  He explained that that the very idea of this tax attacks the very essence of capitalism.

And while I see his point, and am wary of political actions that involves scapegoating any isolated source, I don’t share his feelings on the subject.  The reason is simply this: the oil companies have been bad actors for some time – as he acknowledges; they have taken steps to ensure that Americans never developed alternative fuels, and have decided more recently to pocket much of the profit instead of investing it in developing alternate fuels.  Rather than leading the way in helping to free America from it’s reliance on oil – which not only is driving global climate change, causing pollution, propping up anti-American and tyrannical forces around the world from Russia to the Arab world, and creating the most massive transfer of wealth in the history of humankind – Big Oil has worked to ensure the system stays as it is.

Throughout American history, presidents have attacked and modified the basic foundations of capitalism when they felt it was necessary to protect essential American institutions and values.  Abraham Lincoln liberated the property of millions of Southern plantation owners; Woodrow Wilson, Franklin Delano Roosevelt, and Harry Truman created systems of wage and price controls; private property was regularly and promiscuously confiscated by the government to make way for railroads and highways and now anything that will generate higher tax revenues; tariffs and subsidies have always distorted capitalism – as did regulation, once it became commonplace.

What we see in the history of America and capitalism is a constant balancing act – between free market forces and the forces that wish to preserve an ordered society.  Capitalism – by it’s nature – is exploitative.  Unregulated capitalism is what drove America’s growth through the 1870s, 1880s, and 1890s – as workers were abused, killed, and entirely exploited – living in shanty-towns like slaves – as big corporations bought Congressmen by the dozen and forced through laws benefiting them – all of this for the benefit of a wealthy few.  This was capitalism.  And then in the 1950s, with the top marginal tax rate set over 90% and the gap between the rich and the poor narrower than ever, with unions representing 36% of workers, that too was capitalism.  Both the bustling city of Alexander Hamilton and the idyllic country farm of Thomas Jefferson were capitalistic.  For all the talk of “creeping socialism” over the past half-century, the only time America came close was the direct result of the inaction of Herbert Hoover and the overcompensation by Franklin Delano Roosevelt.  And at no point was America ever purely capitalistic.

Civil liberties, once given away, are extremely difficult to get back; executive power, once taken, is rarely relinquished; but American-style capitalism has proved to be a canny system, surviving under even the most stringent regulations and fighting it’s way back until, as before, it’s excesses trigger a response.

Under this understanding, I can accept the idea of a windfall profits tax.

The government has always been intruded in the economy.  During the late 1800s, the government fought for and protected the interests of the rich against the poor and anyone else (although this period comes closest to demonstrating what a laissez-faire system would produce); during the 1950s and 1960s, the government protected the middle class; by the late 1960s and 1970s, the government had shifted it’s focus to the poor.  Today, the government has once again shifted to the protection of the rich – while maintaining some of the programs that protected the middle class and the poor.  The Financial Times of London observed just a few weeks ago that while the government let homeowners in default fail by the thousands, they could not let any big corporations fail and that by privatizing profits and socializing losses, the American government is practicing socialism for the rich.  Is a windfall profits tax any greater of an intrusion into the market, an undermining of capitalism, than the attitude that if you become big enough, the government will not let you fail – and while you can keep your profits, your losses will be socialized?

What Obama is specifically proposing is to give a $1,000 emergency energy rebate to consumers – a tax cut for individuals – paid for by this windfall profits tax.  With many of our national economic woes directly tied to the oil industry which is making more profit than at any time in history – this seems just in this instance, even if it is flawed in theory.

I’m not crazy about the idea – but I do see it as an appropriate punishment for big oil – who, though their poor stewardship of a national security asset, have endangered our way of life.  Thus far, for their bad behavior, they have been rewarded with the greatest profits of any corporation in history.

While I see that this windfall profits tax could set a bad precedent – I do think it can be justified in this instance.

The real conversation here – and the real reason for this proposal by Obama – is not about economic policy, but about politics.  John McCain recently reversed his position on offshore drilling to take the popular position that we should open up those few areas designated to be preserved for drilling.  This will not affect oil prices for at least seven years – and distracts us from the real problem at hand – a disastrous national addiction to oil.  But the politics was too good for McCain to pass it up – and now he is using this cudgel of offshore drilling to club Obama.

Obama’s response to this is his proposal for a windfall profits tax.

As Kevin Drum sees the politics of this:

As a one-off, this probably doesn’t have much impact, but if it’s a harbinger of things to come — and I assume it is — it holds huge promise. It’s just like McCain’s legendary series of flip-flops: on an individual basis they don’t matter too much, but when you put them together into a coherent narrative they make a powerful story. After all, pretty much every McCain flip flop has a single source — changing his position to be more acceptable to the anti-tax, big business, Christian conservative base of the Republican Party

I don’t know if any of this will make my friend feel any better.  But it is a position I can accept.  As a policy, I don’t think it’s the best idea – and I don’t think it helps solve any problems.  But as politics – which is the only way to understand it – it is pitch-perfect for the times.

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Domestic issues Economics Election 2008 McCain Obama Politics

The slippery slope

I received an email from my friend this morning – an aspiring entrepreneur – regarding his concerns about Barack Obama’s economic policy – which I’ve been finding are rather widespread:

So I want to start by saying I am an Obama supporter because I really feel where he might not be the most experienced in a lot of areas he will provide a much needed catalyst to change the way America thinks and behaves with respect to a lot of important issues effecting humanity on a whole. Where his economics scare me to death, and I do hope he gets better advisers than his current ones on the economy, I still feel he is the right choice for America at this point in time.
That said, I read this article today after seeing a brief snippet on CNBC this morning regarding the same issue.

I simply do not know what to say. Yes oil companies are evil. There is no question there. But just as the Patriot Act symbolized the opening of a door into the trampling of basic freedoms that make America what it is, I can not see this proposal as anything but the same. You simply can not limit the amount of profit a company can make and still call this America. Tax the profits to hell. Let the government take it’s cut, but you simply can’t open the door for government to say how much a company can or can not make. If we limit what oil companies make what is next? Pharma? Factories?

I like Barack but this is uncalled for and simply unacceptable. I will refrain from questioning if he is, in fact, an American idealist and just assume this is the result of a temporary lapse in judgment.

Now mind you this is a separate issue than personal taxes which needs its own discussion. This is about business, this is about capitalism, and this is about what makes America great.

Just my two cents (which today are worth even less Euros than yesterday)

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Economics Election 2008 Life McCain Obama Politics Reflections

An insight about blogging

I recently came to a new understanding about blogging.

About a week ago, I spoke with a friend of mine – who I consider to a somewhat successful businesswoman – ((I only include the qualifier ‘somewhat’ because it is obvious that she has greater ambitions.)) who explained to me that she was not sure who she was going to vote for because her top concern was the economy and she was not convinced about either candidate’s competence on this matter.

This came up as, walking by her office, she told me, motioning to the newspaper in front of her, “Obama’s economic ideas are getting torn apart here.”  She was reading the editorial page of the Wall Street Journal – so, of course, they were beginning to warm to the man they had despised for these many years, as he sought to “coddle terrorists” because he was now the lapdog of the economic far right and the imperialist far right.

Of course, I mean John McCain, who tragically has sought to dispel his identity as a maverick who would stand up to the far right by groveling to the twin pillars of the elite wing of the Republican party.  (McCain has been unable, or unwilling, to effectively seek the backing of the less elite, social right wing of the Republican party.)  McCain, unable to give a position governing vision of his own – aside from a League of Democracies which would allow the United States to begin a new cold war with the tyrannies of the world including the two most powerful upcoming great powers, Russia and China – has sought to win the support of the three pillars of the Reagan-Bush coalition by selling visions of the social, economic, and foreign policy apocalypse that would occur should Barack Obama win the presidency.

That’s what McCain is now about – what his career has come to – demonizing Barack Obama.  And I don’t think this is just some unfortunate political step McCain feels he needs to take – like endorsing the Confederate flag while campaigning in South Carolina.  After he did that, McCain apologized afterwards and said he was wrong and pandering.  While McCain knows many of the shots he is taking now are cheap – his early and strident attacks on Obama demonstrate a kind of urgency.  McCain truly seems to have convinced himself that he deserves to be president, and Barack Obama is arrogant for challenging him.

My friend could see this – and probably agreed with most of this.  But what she cared about was economics.

I discussed some issues with her, acknowledging that economics was not my strong point.  But what I encountered while speaking with her was an agreement about the type of problem that we faced – a genuine structural problem within our capitalist system that had been worsening for some time – but a lack of understanding about the next steps.  I believed – and tried to portray – that McCain, as a doctrinairre Republican on economics since 2006, would attempt to benefit the richest, fewest individuals while enabling the worst excesses while Barack Obama would take moderate, pragmatic steps to correct some of the underlying issues.

After speaking with her, I wanted to write one complete piece that would effectively make this case.

And for days, I wrote little else as I struggled to put together these pieces.

And that is when I realized something about blogging.  The strength of a blog is not in any individual piece, but in working through the ideas in real time, responding to each day’s news events in some small way, putting a spin, adding a bit of understanding.  Even as I would do that, I would still attempt to write “the piece” that would make a difference, that would change minds.

Blogging is about writing dozens of pieces – which together form a kind of journal, allowing insights into thought processes that are not available in single articles which should be consistent and coherent.  Instead, blogs at their best provide a messy view of the thought process that would go behind an article, behind an idea.  As people respond and attack and support a blogger’s arguments, they evolve.  And that it what makes blogs a strong medium – even if it also demonstrates why they can never replace more definitive works.

Which is why I’ll now be adding another area to ruminate on – the economy.