1. Moral Hazard Republican leaders in Congress have belatedly begun developing a spine, opposing the bailout of the Detroit automakers. But Democrats are still pushing for it anyway, and it looks like this will be the last battle of the current Congress. The bad news—and yes, the news is mostly going to be bad for a while—is that the bailout may be defeated now but is likely to be approved by the new Congress in January.
"Congress Meets for One Last Fight and to Look Ahead," Carl Hulse, New York Times, November 16 "With the very first vote after the election, Democratic leaders in Congress want to pass a $25 billion handout to Detroit with no promises of reform, accountability or transparency by the automakers and their union base," said Senator John Cornyn of Texas, who is in line to lead Senate Republican campaign operations.
But Democrats say Congress must act now to protect millions of well-paying jobs spread throughout the economy that depend on a stable auto industry. They promise to impose a series of tough conditions on the money and to create an oversight board….
The impasse, a fitting end for the 110th Congress given the stalemates that marked the past two years, makes it quite likely that any separate bailout for the auto industry will have to wait until after President-elect Barack Obama is sworn in on Jan. 20. The odds are also against a broader measure sought by Democrats in an effort to help the economy. The legislation with the best chance of clearing Congress this week is a 13-week extension of unemployment benefits for those who have exhausted their aid in states with high unemployment….
In the aftermath of stinging election losses, Republicans appear ready to take a harder line on spending, stifling the Democratic call for the aid to the automakers, which has the support of the industry as well as the United Auto Workers.
Senator Richard C. Shelby of Alabama, senior Republican on the banking committee, on Sunday referred to the domestic automakers as dinosaurs that had failed to adapt. "I don't believe the $25 billion they're talking about will make them survive," Mr. Shelby said on "Meet the Press" on NBC. "It's just postponing the inevitable."
2. The Great Unlearning The pro-free-market right is not dead. There are still some good commentators out there making excellent economic points. A Bloomberg News columnist, for example, argues that the economy recovers faster without bailouts, for the obvious reason: subsidizing failure is not the road to economic success.
Even better, this crisis has provided something of an opening for advocates of the gold standard, including an op-ed from a consultant with the Federal Reserve Bank of New York.
But what is most striking is the almost complete lack of any serious political leadership capable of standing up for, explaining, and defending the free market.
An important part of the big picture is captured in the Forbes article below which describes the progress made by pro-free-marketers within the profession of economics (where they represent the only non-quack school of thought)—and then laments the concerted effort to wipe out this intellectual achievement and to unlearn "all that we learned from the long struggle between collectivism and free markets during our own time."
"The Loss of Individual Liberty," Peter Robinson, Forbes, November 14 Over dinner with Milton Friedman several years before he died, I offered the great man a compliment. He refused it….
Academia as a whole may have continued its long, sorry wobble to the left, I continued, but the economics profession had proved an exception, moving the other way. Departments of economics across the country now grasped the importance of free markets. "Mises, Hayek, Stigler and you," I told Friedman. "You've transformed the intellectual climate. You've won."
Friedman shook his head. "We may have won the intellectual battle," he replied, "but in practical politics, it's difficult to see that we've had any effect at all."
Government spending had continued to grow, he explained. After a pause during the Reagan years, regulations had once again proliferated. For a moment, Friedman grew silent. Then he looked at me.
"The challenge for my generation," he said, "was to provide an intellectual defense of liberty. The challenge for your generation is to keep it."
To tell you the truth, I doubted it….
All that the nation's founders understood two centuries ago about the imperative of limited government, all that we learned from the long struggle between collectivism and free markets during our own time—all this could soon simply evanesce.
We are being asked to unlearn what we know, to surrender the virtues that can only be acquired in conditions of freedom, and to become a lesser people than we are. The land of the free and the home of the brave could soon be transformed into the land of the dependent and the home of the infantilized.
3. Obamalot Brace yourself for another wave of sickeningly worshipful coverage of Barack Obama in the run-up to his inauguration. Washington Post media critic Howard Kurtz—who has been known to display his own leftward bias—finds the Obama hagiographies a bit much even for him. Below, he catalogues the media's surrender to infatuation with yet another charismatic leftist hero.
The odd thing about the new Obama administration, however, is that while a swooning press corps hails it as "Camelot II," it is actually turning out to be the Clinton Restoration, as Obama stocks his cabinet with former Clinton administration officials and even considers Hillary Clinton for secretary of state.
That is ironic—and perhaps this irony will eventually dawn on Obama's glassy-eyed supporters—because Obama's sharpest difference with Hillary Clinton in the primaries was on foreign policy, the very issue he would entrust her with as secretary of state.
"A Giddy Sense of Boosterism," Howard Kurtz, Washington Post, November 17 Perhaps it was the announcement that NBC News is coming out with a DVD titled "Yes We Can: The Barack Obama Story." Or that ABC and USA Today are rushing out a book on the election. Or that HBO has snapped up a documentary on Obama's campaign.
Perhaps it was the Newsweek commemorative issue—"Obama's American Dream"—filled with so many iconic images and such stirring prose that it could have been campaign literature. Or the Time cover depicting Obama as FDR, complete with jaunty cigarette holder….
The endless campaign is over, and there's nothing wrong with the country pulling together, however briefly, behind its new leader. But we seem to have crossed a cultural line into mythmaking….
The Chicago Tribune trumpets that Michelle "is poised to be the new Oprah and the next Jacqueline Kennedy Onassis—combined!" for the fashion world.
Whew! Are journalists fostering the notion that Obama is invincible, the leader of what the New York Times dubbed "Generation O"?
Each writer, each publication, seems to reach for more eye-popping superlatives. "OBAMAISM—It's a Kind of Religion," says New York magazine. "Those of us too young to have known JFK's Camelot are going to have our own giddy Camelot II to enrapture and entertain us," Kurt Andersen writes. The New York Post has already christened it "BAM-A-LOT."…
MSNBC, which was accused of cheerleading for the Democratic nominee during the campaign, is running promos that say: "Barack Obama, America's 44th president. Watch as a leader renews America's promise." What are viewers to make of that?
4. "Having This Administration Really Lightens the Blow for the Iranians" In the article linked to above, Howard Kurtz has a choice passage on the glowing Kennedy nostalgia and its implication for the current expectation of Obama:
"The Kennedy buildup goes on," James MacGregor Burns wrote in The New Republic in the spring of 1961. "The adjectives tumble over one another. He is not only the handsomest, the best-dressed, the most articulate, and graceful as a gazelle. He is omniscient; he swallows and digests whole books in minutes; he confounds experts with his superior knowledge of their field.
He is omnipotent."
Soon afterward, Kennedy blundered into the Bay of Pigs debacle.
We don't have to wait until after Obama's nomination to begin getting a sense of the problems he will cause. Washington Post columnist Jackson Diehl, for example, observes that the government of Egypt celebrated Obama's election victory by burning down the political headquarter of the liberal opposition party. According to Diehl, this reflects "a principal conclusion that Mubarak and other 'pro-Western' autocrats seem to have drawn from Obama's election: that the threat of US pressure for political liberalization has passed."
Meanwhile, Afghan President Hamid Karzai is making his own arrangements to plan ahead for his country's future under the Obama administration by offering to hold direct talks with Taliban leader Mullah Omar. This offer, of course, is partly a posture, offset by preconditions about the Taliban being really serious about wanting peace—but it is still an intolerable concession to the enemy. Which is to say that it is exactly modeled on Obama's policy toward Iran.
But the big news is the conclusion of a long-awaited security arrangement allowing for the presence of US troops in Iraq through 2011. What is worrying about this arrangement is not that it requires the withdrawal of US troops in three years; as a military matter, the war in Iraq has been won, and all that remains is a police operation against the remnants of militias and terrorist cells.
What is worrying is that this is the stage at which a military victory can be undermined by a political defeat. By encouraging the delay of the security agreement until after the election and by telegraphing an attitude of disengagement from Iraq and a soft line against Iran, Barack Obama has ensured that the political terms on which we leave Iraq will be less favorable to America.
Note, for example, that in one of the great ironies of war, it is the Sunnis—who once formed the backbone of the insurgency—who are opposed to an earlier US withdrawal, because we serve to protect Iraq from the influence of pro-Iranian Shiite factions. Minimizing Iranian influence in Iraq is crucially important for our interests—but it is not a priority for Obama.
Hence the conclusion of an analyst for the left-leaning Carnegie Endowment for International Peace that the Iranians were more favorable to the Iraqi security agreement because they believe they will face less opposition from President Obama. His conclusion: "Having this administration really lightens the blow for the Iranians." And that is what we should be worried about.
"Pact, Approved in Iraq, Sets Time for US Pullout," Campbell Robertson and Stephen Farrell, New York Times, November 16 Iraq's cabinet on Sunday overwhelmingly approved a proposed security agreement that calls for a full withdrawal of American forces from the country by the end of 2011. The cabinet's decision brings a final date for the departure of American troops a significant step closer after more than five and a half years of war….
The proposed agreement, which took nearly a year to negotiate with the United States, not only sets a date for American troop withdrawal, but puts new restrictions on American combat operations in Iraq starting Jan. 1 and requires an American military pullback from urban areas by June 30. Those hard dates reflect a significant concession by the departing Bush administration, which had been publicly averse to timetables….
In Washington, the White House welcomed the vote as "an important and positive step" and attributed the agreement itself to security improvements in the past year….
Several political analysts suggested that Iranian opposition to the pact had softened because of the American presidential election victory of Senator Barack Obama. He has suggested a more diplomatic approach to Tehran and has described a withdrawal timetable from Iraq faster even than the one laid out in the security agreement, though recently he has qualified that stance.
"If George Bush's presidency were going to continue on through 2012, I think people would be a lot more concerned," said Karim Sadjadpour, a Middle East analyst at the Carnegie Endowment for International Peace. "Having this administration really lightens the blow for the Iranians."
A section of the agreement that Iraqi officials said barred the United States from launching attacks on neighboring countries from Iraq also may have diminished Iranian resistance.
"We sent messages to neighboring countries to say, 'This is in our interest,' " said Mr. Fayyadh, the Shiite lawmaker. "Specifically we spoke to the Iranians and gave them guarantees that 'no one will use our country to attack you.' " There was no immediate reaction from Iran to the vote….
Many Sunnis have opposed the pact…[because] they worry that without the Americans, they could be at the mercy of Iraq's majority Shiite population and, behind it, the Iranians….
On Sunday, Shiite legislators could barely conceal their delight in the halls of the Parliament building…. In a sign of their newfound boldness with the Americans, they referred to the pact as the "withdrawal agreement."
5. Israel's Assisted Suicide When you lighten the blow on the tyrants and murderers, the blows fall harder on their victims.
Thus, while the Obama administration is lightening the blow for the Iranian regime—it is preparing a deadly blow to our best and closest ally in the Middle East, Israel. Obama has indicated his support for a Saudi plan in which Israel would withdraw to its pre-1967 borders in exchange for peace with the whole Arab world.
Peace with the Arabs? A fat lot of good that will do Israel, considering that their most dangerous enemies—Hezbollah and Syria to the north, Hamas to the south—are backed by Iran. For the benefit of Joe Biden and others who are not well versed in foreign affairs, the Iranians are not Arabs but Persians.
So peace with the Arabs won't help—but the withdrawal to 1967 borders will hurt.
Jack Wakeland sent me a link to the article below, with the following comment: "Obama plans to push a 'land for peace' deal based on 1967 borders that would place all of Israel within range of 50,000 Iranian-supplied 105mm and 120mm Grad rockets."
This is why the pre-1967 borders have been referred to as Israel's "suicide borders." They make Israel militarily indefensible, putting the whole country in artillery range and admitting the enemy inside the gates of Jerusalem.
No, the Obama administration isn't looking like "Camelot II." It's looking like Carter II.
"Barack Obama Links Israel Peace Plan to 1967 Borders Deal," Uzi Mahnaimi in Tel Aviv and Sarah Baxter, London Times, November 16 Barack Obama is to pursue an ambitious peace plan in the Middle East involving the recognition of Israel by the Arab world in exchange for its withdrawal to pre-1967 borders, according to sources close to America's president-elect.
Obama intends to throw his support behind a 2002 Saudi peace initiative endorsed by the Arab League and backed by Tzipi Livni, the Israeli foreign minister and leader of the ruling Kadima party.
The proposal gives Israel an effective veto on the return of Arab refugees expelled in 1948 while requiring it to restore the Golan Heights to Syria and allow the Palestinians to establish a state capital in east Jerusalem.
On a visit to the Middle East last July, the president-elect said privately it would be "crazy" for Israel to refuse a deal that could "give them peace with the Muslim world", according to a senior Obama adviser….
Obama is also looking to break a diplomatic deadlock over Iran's pursuit of nuclear weapons technology. A possible way forward, suggested last spring by Dennis Ross, a senior Obama adviser and former Middle East envoy, would be to persuade Russia to join in tough economic sanctions against Iran by offering to modify the US plan for a "missile shield" in eastern Europe.
6. Environmentalism's Berlin Wall I have predicted that global warming could become environmentalism's Berlin Wall: the great factual refutation of its ideology. By placing all of their eggs into one very specific scientific basket, the environmentalists have opened themselves up to being discredited if global warming turns out not to happen.
Hence the only good news to be salvaged from the financial crisis. It looks like an economic downturn will put the global warming hysteria on ice as European nations decide that they cannot afford the luxury of giving up fossil fuels. But the global warmists cannot afford such a delay in enacting their agenda, because more and more evidence is accumulating that their whole theory is wrong.
Brad Bereznak sent me a link to the article below, which describes the unmasking of fraudulent data put out by NASA claiming that October was yet another hottest month on record, despite record cold across much of the globe.
Meanwhile, a new article in Nature warns, not of global warming, but of a new ice age, and an article from Engineering News (a very prominent engineering trade publication) endorses Henrik Svensmark's theory that global temperatures are determined, not by man, but by the sun.
"The World Has Never Seen Such Freezing Heat," Christopher Booker, Daily Telegraph, November 16 A surreal scientific blunder last week raised a huge question mark about the temperature records that underpin the worldwide alarm over global warming. On Monday, Nasa's Goddard Institute for Space Studies (GISS), which is run by Al Gore's chief scientific ally, Dr. James Hansen, and is one of four bodies responsible for monitoring global temperatures, announced that last month was the hottest October on record.
This was startling. Across the world there were reports of unseasonal snow and plummeting temperatures last month, from the American Great Plains to China, and from the Alps to New Zealand. China's official news agency reported that Tibet had suffered its "worst snowstorm ever". In the US, the National Oceanic and Atmospheric Administration registered 63 local snowfall records and 115 lowest-ever temperatures for the month, and ranked it as only the 70th-warmest October in 114 years.
So what explained the anomaly? GISS's computerised temperature maps seemed to show readings across a large part of Russia had been up to 10 degrees higher than normal. But when expert readers of the two leading warming-skeptic blogs, Watts Up With That and Climate Audit, began detailed analysis of the GISS data they made an astonishing discovery. The reason for the freak figures was that scores of temperature records from Russia and elsewhere were not based on October readings at all. Figures from the previous month had simply been carried over and repeated two months running….
A GISS spokesman lamely explained that the reason for the error in the Russian figures was that they were obtained from another body, and that GISS did not have resources to exercise proper quality control over the data it was supplied with. This is an astonishing admission: the figures published by Dr. Hansen's institute are not only one of the four data sets that the UN's Intergovernmental Panel on Climate Change (IPCC) relies on to promote its case for global warming, but they are the most widely quoted, since they consistently show higher temperatures than the others.
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