Kevin Drum

Economic Update

| Mon Oct. 20, 2008 1:30 PM PDT

ECONOMIC UPDATE....The latest economic news might not quite qualify as "good," but it's slightly encouraging at least. (1) Germany, the Netherlands, and South Korea are implementing some stunningly large bank rescue operations. (Relative to GDP, all are as large or larger than the U.S. rescue.) (2) Iceland is nearing an IMF rescue plan. (3) Ben Bernanke says a fiscal stimulus plan "seems appropriate." (4) After a price drop of 33% since their peak last year, home sales in Southern California shot up 65% in September. (5) And Calculated Risk tots up the evidence and says it looks like the credit crisis is finally easing a bit.

Don't go getting too excited or anything. More bailouts and a long recession are still ahead. But there might finally be a few tiny rays of sunshine on the horizon.

Advertise on MotherJones.com

McCain vs. Bush

—By Kevin Drum

| Mon Oct. 20, 2008 11:25 AM PDT

McCAIN vs. BUSH....Atrios sez:

I've never been a fan of John McCain. I never had a mancrush on him as most of the "liberals" in the media once did. But there was a time not all that long ago when I thought that a McCain presidency would at least be a marginal improvement over the Bush presidency. Now I believe it would be much, much worse.

This pretty much describes me too. I was never a fan of McCain, even in his 2004 semi-liberal incarnation, but I did have at least some respect for his positions and his character. As Republicans went, especially compared to the sad sack crew they put up for the presidency this year, he wasn't too bad.

But now? If you put a gun to my head and forced me to pull the lever for either McCain or Bush, I'm not sure who I'd choose. Getting the Cheney/Addington crew out of the White House might be worth it no matter what, especially if I could convince myself that McCain is hale and hearty and Sarah Palin would never have any duty more important than attending foreign funerals. But then again, compared to McCain's barely suppressed rage and erratic, free-form bellicosity, the 2008 model George Bush almost seems like a statesman. It takes a very special talent to make people like Atrios and me come to that conclusion. John McCain is obviously a very special talent.

Sleaze

—By Kevin Drum

| Mon Oct. 20, 2008 11:13 AM PDT

SLEAZE....Josh Marshall says John McCain's campaign is the sleaziest we've seen for a very long time:

You may say, wait, Willie Horton? The Swift-boat smears? What about those?

But here's the key point, one that is getting too little attention. President Bush's father didn't run the Willie Horton ad. And this President Bush, however much they may have been funded by his supporters and run with Karl Rove's tacit approval, didn't run the Swift Boat ads. These were run by independent groups. Just how 'independent' we think they really are is a decent question. But even the sleaziest campaigns usually draw the line at the kind of sleaze they are wiling to run themselves under their own name.

This is basically what's struck me about McCain's campaign too: his sleaze has been done in his own name, not kept at arm's length, as it was in 1972, 1988, and 2004.

But although that was my initial reaction to events of the summer and fall, I'm pretty sure it isn't right. Yes, the Willie Horton ad in 1988 was officially an independent expenditure, but the "Revolving Door" ad was very much a Bush-Quayle production. Lee Atwater promised to make Horton a household name, and he did just that. Bush Sr. spoke about him frequently in speeches. And Dukakis's patriotism was a major theme too, as the Bush campaign hit him over and over and over about his stand on the Pledge of Allegiance.

In fact, I'd say 2008 is a surprisingly faithful replay of 1988. On the Republican side it's been sleazy, it's been issue free, and its biggest feature has been a young, attractive, unqualified, base-pleasing conservative vice presidential choice. The big difference is that Obama is a better candidate than Dukakis and 2008 is a far more Democratic year than 1988. On the sleaze-o-meter, however, I think it's pretty much a draw. Anyone with sharp memories of 1988 is invited to agree or disagree in comments.

The Upcoming GOP Civil War

—By Kevin Drum

| Mon Oct. 20, 2008 10:44 AM PDT

THE UPCOMING GOP CIVIL WAR.....After every election, the losing party conducts a civil war. Sometimes it's a big war, sometimes it's a small one, but the subject is usually the same: Did we lose because we failed to appeal to enough moderates? Or did we lose because we failed to uphold our heritage and give the voters a real choice? The arguments are so similar on both sides that even the terminology is often the same. Liberals refer to their party's centrists as DINOs (Democrats In Name Only) and Republicans refer to theirs as RINOs. Republican conservative stalwarts say, "If the choice is between a Democrat and a Democrat-lite, the public will choose the real thing every time." Switch the party affiliation and you get the same thing from liberal Democrats.

So what happens this time around? It's a little hard to keep this in mind at this point, but John McCain was widely considered the most electable Republican this year because of his mavericky politics and appeal to independents. He had moderate cred on immigration, campaign finance reform, and judicial nominees, and though he had a conservative voting record he had never been a committed culture warrior. If you thought that moving toward the center was the right strategy for the Republican Party after eight years of George Bush, McCain was your man.

So if he loses, what happens? Conservatives will have the upper hand, no? We tried a moderate, they'll say, and he crashed and burned. After all, if the choice is between a Democrat and a Democrat-lite etc. etc.

And that in turn suggests that instead of undergoing a long, slow moderation of their positions after this year's election, they'll go in the other direction. Their argument will be simple and compelling: the McCain strategy didn't work. The country is hungering for real conservatism, and that's the only way we can win. Hell, the only thing that even gave McCain a chance this year was his selection of Sarah Palin, the only real conservative on the ticket.

So this suggests an eye-popping state of affairs: after eight years of George Bush, Dick Cheney, and Karl Rove making them into the most unpopular party in recent history, the GOP will decide that the best response to this is to become even more conservative. I can hardly wait to see how this plays out.

Infrastructure

—By Kevin Drum

| Mon Oct. 20, 2008 10:12 AM PDT

INFRASTRUCTURE....Time to rebuild our nation's infrastructure? Support for the idea is growing:

Public officials, engineers and policy experts have been warning for years that crumbling infrastructure is a ticking time bomb....A third of the nation's major highways are in poor shape, according to the Department of Transportation. The list of unsafe dams is growing. Mass-transit systems, water-treatment plants, hazardous-waste sites and more are falling apart.

The civil engineers association gave the country a "D" on its 2005 infrastructure Report Card. It called for a $1.6 trillion five-year improvement program.

Now, sure, you'd pretty much expect a civil engineers association to back a program of civil engineering projects. Still, the time is right. The usual argument against infrastructure projects as fiscal stimulus is that they take too long: you have to identify projects and draw up plans first, and only then do you put people to work building stuff. By the time the projects get started, the recession is over.

But not this time. The recession we're going into now promises to be deep and long, and a big slug of infrastructure improvements would not only be handy things to have, their timing is pretty good too. And politically it's doable too since there are plenty of projects available for all 50 states.

McCain hasn't bought into this because (I'd guess) he still doesn't really appreciate the scope of our financial problems. Plus he probably associates infrastructure projects with earmarks, so he has a Pavlovian reaction against them. Obama has done a little better, but only a little. It would be smart, both politically and substantively, for him to at least start making more aggressive noises on a big, bold infrastructure plan.

Security Agreement Update***

—By Kevin Drum

| Sun Oct. 19, 2008 11:23 PM PDT

SECURITY AGREEMENT UPDATE....Negotiations to put in place a long-term security agreement with Iraq aren't going well:

Key members of the Iraqi parliament's largest political bloc have called for all American troops to leave this country in 2011 as a condition for allowing the U.S. military to stay here beyond year's end, officials said Sunday.

The change sought by the influential United Iraqi Alliance would harden the withdrawal date for U.S. troops....The Shiite bloc, which includes Prime Minister Nouri al-Maliki's Dawa party, also insists that Iraqi officials have a bigger role in determining whether U.S. soldiers accused of wrongdoing are subject to prosecution in Iraqi courts, said Sami al-Askeri, a political adviser to Maliki.

....It was not immediately clear whether the U.S. side would accept the changes to the draft agreement. The document would provide legal authority for American troops to remain in Iraq after a U.N. mandate expires Dec. 31. If there is no accord or other legal cover for U.S. forces, they must leave.

The Bush administration has long resisted setting firm dates for the departure of U.S. troops from Iraq, saying that the decision should be based on security conditions. U.S. authorities ultimately accepted a compromise, which set the 2011 withdrawal date but provided for an extension if Iraq requested one.

Normally, I'd say that this is probably yet another sign of hard bargaining, and in the end an agreement will almost certainly be signed. And that still seems the most likely course to me. On the other hand, the U.S. occupation is unpopular with the Iraqi public, and with elections coming up soon no politician in the country can afford to be seen as soft on the Americans. That's democracy for you. Could be interesting times ahead.

Advertise on MotherJones.com

Happy Birthday to Me!

—By Kevin Drum

| Sat Oct. 18, 2008 11:03 PM PDT

HAPPY BIRTHDAY TO ME!....I turn 50 today. Happy birthday also to Jim Henley, who stubbornly remains a couple of years younger than me. And to Grover Norquist, who stubbornly remains a couple of years older than me. And to GOPAC chairman Michael Steele, who stubbornly remains exactly the same age as me. And to everyone else born on October 19th. Buy yourself a cake today!

I'm Rich Enough Already, Thank You***

—By Kevin Drum

| Sat Oct. 18, 2008 10:24 PM PDT

I'M RICH ENOUGH ALREADY, THANK YOU....Andrew Lahde, who made himself famous by starting up a hedge fund that made a ton of money betting on the collapse of the subprime market, is closing up shop. On Friday, he explained why:

The low hanging fruit, i.e. idiots whose parents paid for prep school, Yale, and then the Harvard MBA, was there for the taking. These people who were (often) truly not worthy of the education they received (or supposedly received) rose to the top of companies such as AIG, Bear Stearns and Lehman Brothers and all levels of our government. All of this behavior supporting the Aristocracy only ended up making it easier for me to find people stupid enough to take the other side of my trades. God bless America.

Get that man a blog!

Chart of the Day - 10.18.2008***

—By Kevin Drum

| Sat Oct. 18, 2008 10:39 AM PDT

CHART OF THE DAY....A couple of weeks ago I quit watching the stock market's gyrations during the day because it was obvious that they didn't really mean anything. Up, down, whatever: the events of the final hour, from 3 pm to 4 pm were all that mattered, wiping out huge gains in an instant or turning small losses into disasters.

Now comes a nice chart via Zubin Jelveh that demonstrates the point graphically. As you can see, normally the stock market moves anywhere from a quarter of a percent to one percent in the final hour of the day. That's roughly the same as the other six hours the market is open. But since mid-September? Final-hour volatility jumped to 2%, and then earlier this month to a high of 6%. That's as much movement as the entire rest of the day. So if you're the nervous sort, give yourself a break and take your eyes off the hourly movements of the Dow. Just check in at 4 pm and be done with it.

Need some more charts? Ezra Klein has a nice one showing that sometimes placebos work just as well as surgery. (With a followup here.) Maybe those Christian Scientists are on to something after all?

Friday Cat Blogging - 17 October 2008

—By Kevin Drum

| Fri Oct. 17, 2008 1:19 PM PDT

FRIDAY CATBLOGGING....We're in the middle of a mild Santa Ana condition right now, which means it's been pretty warm this week. Despite this, Domino has taken to burrowing under the bedroom quilt for her afternoon snooze. So that's what she's doing on the left. On the right, Inkblot, having finally cottoned to the fact that something is going on underneath the blankets, heads over to check it out. Needless to say, this had potential for considerable merriment, but after taking a brief swipe at Domino's paw, which was sticking out of the blanket, he got sort of addled and headed downstairs for a snack. That's always been the real center of his universe, after all.