Raw Data

| Tue Jul. 7, 2009 1:12 PM EDT

The Michael Jackson tribute is currently being aired on 18 separate channels on my TV.  Just sayin'.

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Palin: Not Free Yet

| Tue Jul. 7, 2009 12:34 PM EDT

On Tuesday, I reported that a new ethics complaint has been filed against Sarah Palin, who last week announced she was resigning as governor partly because of all the ethics complaints she has had to confront. In that posting, I glibly noted that ethics watchdogs in Alaska only had three weeks left during which they could pursue Palin. But that's not so. Andree McLeod, one of those watchdogs, sent me a portion of the Alaska state ethics act: 

A violation of this chapter may be investigated within two years after discovery of the alleged violation.

So when--if?--Palin gives up the governorship on July 26, she will not be out of the woods. The ethics-chasers of her state will have 24 more months to submit additional complaints.

You can follow David Corn's postings and media appearances via Twitter.

Pricking Bubbles

| Tue Jul. 7, 2009 12:21 PM EDT

Alan Greenspan famously argued that the Fed shouldn't pay attention to asset bubbles.  They're hard to identify, he said, dangerous to prick, and can be better dealt with after they deflate.  This was, roughly speaking, the "Greenspan put," which served to make the recent housing bubble worse than it otherwise would have been, since investors knew the Fed would do nothing to stop the party while it was underway and would always be around afterward to help clean up.

Via Simon Johnson, I see that recently appointed New York Fed chairman William Dudley, a longtime bubble hawk, gave a speech a few days ago taking issue with Greenspan's claims:

Relative to this, I would argue that:

1. Asset bubbles may not be that hard to identify — especially large ones. For example, the housing bubble in the United States had been identified by many by 2005, and the compressed nature of risk spreads and the increased leverage in the financial system was very well known going into 2007.

2. If one means by monetary policy the instrument of short-term interest rates, then I agree that monetary policy is not well-suited to deal with asset bubbles. But this suggests that it might be better for central bankers to examine the efficacy of other instruments in their toolbox, rather than simply ignoring the development of asset bubbles.

3. If existing tools are judged inadequate, then central banks should work on developing additional policy instruments.

Let’s take the housing bubble as an example. Housing prices rose far faster than income. As a result, underwriting standards deteriorated. If regulators had forced mortgage originators to tighten up their standards or had forced the originators and securities issuers to keep “skin in the game”, I think the housing bubble might not have been so big.

I think that this crisis has demonstrated that the cost of waiting to clean up asset bubbles after they burst can be very high. That suggests we should explore how to respond earlier.

The basic proposition here — namely that letting bubbles run their course might not be such a great idea after all — is no longer especially controversial.  But Dudley's second and third points are the important ones here.  Even now, many economists still argue that hiking interest rates and producing a recession is too high a price to pay every time someone thinks an asset bubble is forming.  But if that's the case, it means that the Fed needs to be more aggressive about applying more targeted tools to prick bubbles, or, if their tools are inadequate, asking Congress to give it better ones.

Johnson is skeptical that Dudley is really serious about this.  If he is, the next step is to put some meat on the bones of this speech: specify how asset bubbles should be identified and what kinds of tools are needed to fight them.  Stay tuned.

Drug War's Latest Victim: The PAN

| Tue Jul. 7, 2009 11:44 AM EDT

Yesterday, the Mexican people handed President Felipe Calderon and his PAN party a stunning rebuke, giving the PRI—the party that held insanely corrupt sway over the country for 70 years—the upper hand in Congress and many of the contested governorships, including some thought to be PAN strongholds.

The reason? Well the economy for one, but also that Mexicans are fed up with drug-related violence consuming their country and don't think that Calderon's war on the cartels has done much good. (A war that we are helping to fund.)

That's no surprise to anyone who reads Charles Bowden's harrowing piece on Emilio Gutíerrez Soto, a reporter who found himself on the wrong side of corrupt army officials who are using the pretext of the drug war to wage their own bid for power. Calderon may honestly be trying to root out corruption, but it is so deep rooted, the cartels so bloodthirsty, that Meixcan citizens are fed up.

The military has again flooded northern Mexico, ever since President Felipe Calderón assumed office in December 2006 with a margin so razor thin that many Mexicans think he is an illegitimate president. One of his first acts was to declare a war on the nation's thriving drug industry, and his favorite tool was to be the Mexican Army, portrayed as less corrupt than the local or national police. Now some 45,000 soldiers, nearly 25 percent of the Army, are marauding all over the country, escalating the mayhem that consumes Mexico. In 2008, more than 6,000 Mexicans died in the drug violence, a larger loss than the United States has endured during the entire Iraq War. Since 2000, two dozen reporters have been officially recorded as murdered, at least seven more have vanished, and an unknown number have fled into the United States. But all numbers in Mexico are slippery, because people have so many ways of disappearing. In 2008, 188 Mexicans—cops, reporters, businesspeople—sought political asylum at US border crossings, more than twice as many as the year before. This is the wave of gore the man rides as he heads north.

Emilio has applied for asylum. The cartels have threatened his US lawyer, who now starts his car with a remote control. Read the piece. Watch his interview with Reporters Without Borders. And then contemplate the fact that the cartels are openly advocating for the candidates of their choice, infiltrating our border patrol, and already operate in 259 US cities.

This is your war on drugs.

Alec Baldwin For Congress?

| Tue Jul. 7, 2009 11:43 AM EDT

Alec Baldwin: leading man, comic genius, bad dad, ultra-liberal pontificator, ... member of Congress? Yep, the troubled Hollywood actor, enjoying a resurgence thanks to the popularity of NBC's 30 Rock, tells Playboy that he's looking to join the party on Capitol Hill in 2012, assuming a suitable seat becomes available. "The desire is there, that’s one component,” he says. “The other component is opportunity." 

From the actor's perspective, the timing is perfect. His current contract with NBC expires in 2012, just when his new gig would kick in. Celebrities-turned-politicians are a fixture in American politics: Ronald Reagan, Arnold Schwarzenegger, Jesse Ventura, and, most recently, Al Franken, to name a few. But is Baldwin worried that he'll be perceived as just another Hollywood celebrity trading his fame for political power? Nope. He's particularly confident when comparing himself with California's governor. "His only credentials are that he ran a fitness program under some bygone president," Baldwin says. "I'm (Alexis) de Toqueville compared to Schwarzenegger."

Which state would Baldwin most like to represent? Not California. "Who wants to live in California?" he joked. Connecticut meets his approval, particularly if he can face off against Joe Lieberman. But New York seems to be his most coveted spot--if there's a spot open in 2012, that is. "People get sick, die. They're offered lucrative deals and want to cash in and make money for their retirement. People misstep. Unfortunately, an opportunity for me may mean bad things for someone else."

Raw Power

| Tue Jul. 7, 2009 11:31 AM EDT

In a speech today in Russia, Barack Obama said  that "the pursuit of power is no longer a zero-sum game."  Dan Drezner isn't so sure:

If he had said, "The pursuit of prosperity is no longer a zero-sum game," I'd be fine with the passage.  I still think power is a zero-sum concept, however.  The two ideas are linked but hardly the same. 

I suppose that's true.  Even in a Thomas Barnett-ish world where all the big players gang up to police the world, it's prosperity and security that are positive sum, not raw power.  Anyone care to try and come up with a counterexample?

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GOP May Delay Sotomayor Hearings

| Tue Jul. 7, 2009 11:30 AM EDT

After several concerted weeks of trying, congressional Republicans so far have failed to find any good reason why Sonia Sotomayor should not be confirmed as the next Supreme Court justice. Apparently, though, they just think they need more time to find a smoking gun. CQ Politics reports today that Sen. Jeff Sessions (R-Ala.) may use some procedural rules to delay the confirmation hearings scheduled to start Monday. He told CQ that the Judiciary Committee needed more time to pour over documents from the Puerto Rican Legal Defense and Education Fund, where Sotomayor had long served on the board. He also added that several members of the committee would be tied up with the concurrent health care reform hearings next week. One of Session's colleagues, though, suggested another motivation for the delay: air time.

With both [hearings] “on television at the same time,” said Charles E. Grassley , R-Iowa, who sits on both panels, “What senator wants to be absent from either one of them?”


Taking Sarah at Face Value

| Tue Jul. 7, 2009 11:00 AM EDT

Sarah Palin, decked out in fishing gear and hauling in the salmon, talks to ABC's Kate Snow about why she quit as governor of Alaska:

Palin conceded many people are still confused about why she made the decision to leave office. "You know why they're confused? I guess they cannot take something nowadays at face value," Palin said.

But she said a major factor in the decision was the mounting legal bills she and the state have had to incur to fight ethics charges from her political adversaries. None of the accusations has been proven but, she said, the costs of fighting them have been enormous.

"You know conditions have really changed in Alaska in the political arena since Aug. 29, since I was tapped to run for VP. When that opposition research — those researchers really bombarded Alaska — started digging for dirt and have not let up. They're not gonna find any dirt," she said. "We keep proving that every time we win an ethics violation lawsuit and we've won every one of them. But it has been costing our state millions of dollars. It's cost Todd and me. You know the adversaries would love to see us put on the path of personal bankruptcy so that we can't afford to run."

I'm actually more willing than most to take Palin's explanation at face value.  The constant stream of piddling and frivolous ethics charges probably did get hard to put up with and probably did cost her a lot of money.  But don't most politicians in similar circumstances set up a legal defense fund of some kind?  The attacks would still be annoying, but dealing with them doesn't necessarily have to be either a huge time sink or a huge personal cost, especially when you have the fundraising power she does.

Very mysterious.  But my guess is that the other half of her explanation should be taken at face value too.  (Well, face value plus a little bit extra.)  Namely that she doesn't want to be a lame duck.  Not because she doesn't want to milk the good citizens of Alaska for lots of overseas junkets, but because the entire legislature hates her guts these days and the whole thing has become a slog.  "We won't get anything done," she told Snow, and just that's no fun.  Giving speeches to adoring throngs is way more satisfying.

Obama In Moscow: We Are All Community Organizers

| Tue Jul. 7, 2009 10:54 AM EDT

President Barack Obama on Tuesday attended a meeting of civil society NGOs in Moscow at the Metropol Hotel. He continued his call for a thaw in US-Russian relations:

We not only need a "reset" button between the American and Russian government, but we need a fresh start between our societies -- more dialogue, more listening, more cooperation in confronting common challenges.

He, of course, praised the work of the activists before him. But he did so in a unique fashion: 

Oftentimes politicians get the credit for changing laws, but in fact you've created the environment in which those new laws can occur. I learned this myself when I worked as a community organizer in Chicago....I was working in communities that were devastated by steel plant closings, and so I went door to door, I worked with churches, trying to learn what people needed.

And we had a lot of setbacks -- in fact, we had more failures than successes. But we kept on listening to the people, we learned from them, we got them involved. And over time they chose projects to work on -- whether it was building a new play lot or improving a neighborhood park or improving the local school or improving housing in the community -- and slowly, block-by-block, neighborhood-by-neighborhood, you started to see change happen: more jobs, better housing, more opportunities for young people. And I learned a lesson -- that if you want to bring change, it's not enough just to be an advocate; it's not enough to just wait for the government to act. You have to step up and deliver results, real impact on people's lives.

That's not something that any other modern American president could say--speaking from experience about community organizing. What would be the George W. Bush equivalent: "I know growing a small business is tough. When I was trying to do that, I had to go to one friend of Dad's after another"?

Obama, yet again, was bringing personal credibility to a message he was selling overseas. He's done this effectively in his high-profile speeches in Turkey and Cairo. 

In this address, he recognized that the task of advocacy and organizing is different from that of governing:

Make no mistake: Civil society -- civil groups hold their governments to high standards. And I know -- because this audience includes Americans who've been critical of me for not moving fast enough on issues that are of great importance. They've said it to my face. In the Oval Office. While I was President. (Laughter.) They told me I was wrong. And in some cases they changed my mind; in some cases they didn't. And that's okay, because we're not going to agree on everything -- but I know this: Their voices and their views and their criticism ultimately will make my decisions better, they will make me ask tougher questions and ask my staff tougher questions.

So when human rights advocates criticize the White House for not being more transparent about past abuses or when champions of single-payer health care push the administration to develop the best public option available, they can point to Obama's speech and say, "We're just trying to help you." No doubt Rahm Emanuel will say thank you.

You can follow David Corn's postings and media appearances via Twitter.

Welcome to the Al Franken Decade

| Tue Jul. 7, 2009 9:24 AM EDT

Al Franken, formerly of Saturday Night Live and the author of Rush Limbaugh is a Big Fat Idiot and Other Observations, will be sworn in as a US Senator from the state of Minnesota later this morning. It's been a long journey for Al from late night comedian to CSPAN celebrity, and Mother Jones has been watching all the way.

Franken sat down for an interview with us way back in 1996, right after Big Fat Idiot soared to the top of best-seller lists. In 2004, he wrote an article for us about his USO tours. We reviewed a movie about Franken in 2006. In 2007, as Franken was gearing up for the Senate campaign, Jonathan Stein profiled him for the magazine. And we've covered the election and the recount battle exhaustively: we covered the initial vote count, noted his Mick Jagger stylings after the results came out, and watched as public opinion turned against Norm Coleman's court fight. Later, I predicted (correctly) when Franken would be seated and reminded you what to call him when he won. And then Norm Coleman conceded, clearing the way for Al to get sworn in today.

You can safely assume that we'll keep you posted.