Archive for August 2008

The Big Picture

August 31, 2008

In a number of recent newspaper articles, I have read about the “big picture”.  Specifically, Obama gets it and McCain does not.  The big picture refers to what frames the candidates’ world views, that is “the cold war” or the “post cold war”.  The cold war involved very dangerous times and great risks and uncertainty for the US.  Being strong and talking tough were prerequisites.  The US talked for it friends and allies, and Russia talked of its.  The post cold war is much different and in particular, the years following George W Bush will be amazingly different.  While being strong is still necessary, talking tough begs the questions (1) to whom, and (2) how can you back up your tough talk.

Bush’s invasion and occupation of Iraq has shown two things.  Against non-nuclear enemies and in the role of invader, the US is pretty good.   In the role of occupier, it is another story.  In purely business terms, the Iraq invasion and occupation should have gotten the CEO fired.  Economically this military action has been a disaster that keeps on giving.  Listening to McCain we should expect more of the same.

Even if McCain might have managed the occupation better than Bush and Cheney, it stills begs the question of why the Iraq diversion at all.  It was sufficiently clear in 2000 that China and India had booming economies growing at rates unheard of in the US this century.  With a combined 2 1/2 billion citizens, these two emerging countries represented a very real risk to the US economic leadership.  By not renouncing the Iraq invasion, McCain has de facto endorsed the colossal waste of time, prestige, and money (our treasury is now full of IOU’s totally $ 9+ billion). 

The years immediately ahead will host numerous rulers as corrupt and evil as Saddam Hussein.  The threats imagined and presented by radical Islamic extremists will continue despite our efforts in Iraq or Afghanistan.  The world is also entering a worldwide recession from which the path to growth and prosperity is not clear.  The relationships between China-India, India-Pakistan, Russia-China, Europe-Russia, Isreal-Middle East countries, and the US to all of them, is situational and not clear cut as in the Cold War.  What should be clear is that military force is useless and only valuable as a deterent.

Immigration will continue to be a fact of life in the US.  We need immigrants to grow our economy and we need policies that enable these new Americans to integrate successfully into the country’s social fabric.  Our infrastructure badly needs repairs.  Healthcare, social security, education, roads, bridges, rivers, and airports all need updating in order to support a growing economy for over 300 million.  And all of this must be done in the recognition of the need to find alternative energy sources and reduce green house gas emissions at the same time.  This is a BIG PICTURE.

The Teams Are Set

August 30, 2008

The game of politics moved into the next inning yesterday with John McCain announcing his vice president choice, Sarah Palin.  The teams are set and the game has begun… well almost.  The Republicans must hold their anti-climatic convention first.  Never the less all the pundits will be consumed with what the selection of a woman will do for McCain.

It is clearly too soon to tell but Governor Palin made a very positive impression in her acceptance speech yesterday.  She was poised, comfortably assertive, and clear in her delivery.  The limited biography that was released describe an “honesty in government” and “rugged outdoors person” remeniscent of America’s past.  In short Sarah was refreshing to hear. 

There are, however, two levels of issues upon which the election could be decided.

1. Issues that matter

  • The dismal record of failed policies of the Bush Administration
    • Abrogation of the ABM treaty leading to Star Wars again
    • Invasion and occupation of Iraq
    • Open antagonism of Russia
    • No progress in Israeli-Palestinian negotiations
    • Lack of adequate oversight of banking and investment industries
    • Loss of value of the dollar
    • Invasion of citizens privacy without due process
  • McCain’s support of most of these policies
  • Restoration of a sensible and affordable foreign policy
  • Focus on America’s infrastructure, both social and physical
    • Healthcare
    • Education with funding
    • Roads, rivers, bridges, and air system
  • Investments in the future
    • Serious alternative energy sources program
    • Stimulation of science and math as routes to innovation

The election needs to focus on these issues and not the level two issues such as

2. Issues that do not matter

  • Pro-life versus pro-choice
  • Guns with no constraints versus geography based sensible regulations  (what is appropriate and often necessary in Alaska (a huge State with only 600,000 people) is not necessarily appropriate for Philadelphia (a City of 4 million).
  • Race or gender  (there is no reason to believe that white, black, man, or woman will determine the success of that person as President or Vice President)

If you consider the two teams in this light, the selection of Sarah Palin does not shift the balance of preference.  There is, however, one act that McCain could still do that would help him shift the odds.  He could

  • Disavow and repudiate the record of the Bush Administration
  • He could revisit the Bush tax cuts, disown them, and announce his rebirth as a fiscal and monetary soundness candidate
  • He could affirm that he was pro-choice and his choice was for fewer abortions while recognizing the inherent right of woman to determine their own reproductive health.

Under those condidtions John McCain becomes a much more attractive candidate.

One Down, One To Go

August 29, 2008

Barack Obama accepted the Democrat Party Presidential nomination last evening and gave one more speech finishing off a week full of all sorts of speeches.  It is difficult to judge whether anyone is better informed or suddenly moved for or against Obama after all this hype.  One wonders what new information has been presented?  What new impressions have been made? 

On Monday John McCain’s team will kick off the Republican convention amongst “stars and stripes forever”.  There will be another week of speeches, videos, and of course, breath taking interviews with the cable news networks.  And when next Thursday arrives and McCain completes his acceptance speech, what do you think will happen?  Will the best choice for America’s next President be more evident?

My guess is that anyone who has considered themselves an Obama supporter, the die is already cast.  And the same can be said for those who support McCain.  They are for McCain now and they will be for him in November.  Both of these observations should hold unless one of the candidates has a “Richard Nixon moment” and suddenly appears significantly weaker in comparison to his opponent as did Richard Nixon in his TV debate with John F Kennedy.

From my perspective I favor the temperament of Barack Obama and I suspect his advisers (particularly the academic and business ones) will produce government policy more similar to Bill Clinton’s 8 successful years.  Therefore I would select Obama over McCain while admitting that I can not be sure what type of President either of these men might be.  Events so often make the hero.

Even more compelling is the need to send an unmistakable message to the Republican Party.  These last 8 years have been a disgrace to any decent Republican.  Does the Republican Party want to be known as the party that

  • Can not balance a budget?
  • Is willing to double the national debt (now at $ 9+ trillion)
  • Uses military options first in its foreign policy
  • Invades and occupies countries when no imminent threat exists
  • Treats women, gays/lesbians, and Mexicans as second class (or less) citizens
  • Shows incompetence in running government (read Katrina)
  • Acts unethically if not illegally in politicizing the Justice Department
  • Demonstrates ignorance of science and its value to Americans
  • Has become the party of the very, very rich

It is important in our current form of government that we have two fully competitive parties.  If Americans think through the record of the Bush years, and still decide to vote for John McCain, you can only sit back and wait for further excesses under a President McCain.  For the good of America, the opposite is necessary.  Barack Obama must become the next President for at least four years.  During that time the Republicans need to do some soul searching about the value of all people and the value of sound fiscal and monetary policy.  Only time will tell whether Obama will deserve a second term but a “time out” of 4 years will do wonders for the Republican Party.

The Oil Puzzle

August 28, 2008

The Republican Party adopted a plank for its platform specifically calling for immediate increase in off shore drilling.  They even debated including a specific reference to the Artic National Wildlife Reserve as one of the places to drill.  The Republicans claim more drilling, more oil, and lower prices.  Sounds too good to be true.

You wonder whether the Republicans have thought about oil in any other terms than a way to make money for their wealthy supporters?  Have they connected oil to George W Bush’s failed Middle East policies?  Have they considered that oil is not renewable and will eventually run out?  Have they considered the value in developing alternate sources of energy?  Have they understood that developing sources such as solar power or carbon sequestration (burning coal but capturing the CO2) takes time and will not come to pass unless we put a serious effort behind it?  Have they considered simply the numbers… China and India combined have 2 1/2 billion people and they will consume exponentially more oil as these countries’ economies develop. 

Republicans like to see themselves as free marketeers.  “Let supply and demand set the price and everything will take care of itself”.  Republicans quickly shout that drilling for more oil will drive down the price of oil (as supply increase) and smile having proven their point.  The simple overlooked fact is that the world’s economy is consuming more oil everyday regardless of what the US does, and the US population has already demonstrated that they will gladly consume ever more oil at lower prices.  This is worse than a “catch 22”.

There is no question that the Government, either Republican or Democratic, must ensure that there is enough oil available for our economy.  I did not say cheap oil, I simply said oil at a world price.  Our Government should ask seriously the question “why is gasoline in Europe so much more expensive than in the US?”  The answer that may come forward is that gasoline is more heavily taxed in order to discourage wasteful usage.  This suggests an unobvious step that could be tied into drilling, even in ANWR.  Drill and tax! 

If the Republicans were really thinking about the future, they should propose drilling along with higher taxes on gasoline.  For example, gasoline could sell at about $ 5 or $ 6 a gallon.  This assumes a world price of oil of $ 120 per barrel which currently translates into about $ 3.50 per gallon of gasoline.  The $1.50 to $ 2.50 surcharge per gallon would be collected and used by the Government to fund alternate energy research and to provide tax credits for early adopters of new source technologies.

That type of bold and insightful policy initiative would certain make the Republicans again “The Grand Old Party” and not the “Make the Rich, Richer Party”.

He Said It

August 27, 2008

At an American Legion convention yesterday, John McCain said with great clarity why (1) he is in lock step with the Bush/Cheney “ends justify the means” crowd, and (2) why McCain is not fit to be the next President.  As quoted in a New York Times electronic news report, McCain said:  (I have underlined and added bold print)

“Just days after the Russian invasion of Georgia, Senator Obama had this to say about the crisis,’’ Mr. McCain said here in an address to the American Legion’s 90th national convention. “Quote: ‘We’ve got to send a clear message to Russia and unify our allies. They can’t charge into other countries. Of course it helps if we are leading by example on that point.’ End of quote.’’

“I guess we are left to figure out the rest for ourselves,’’ Mr. McCain continued. “It’s unlikely he was alluding to Afghanistan, the nation we liberated after 9/11, and continue to help despite Russian complaints about our related deployments in Central Asia. And he probably didn’t have Kosovo in mind either – although Russia didn’t care much for that military action, either. We and our NATO allies had to end the Serbian slaughter of civilians in Kosovo without UN approval, because the Russians blocked the effort in the Security Council.’’

“If I catch Senator Obama’s drift, then, our failure to ‘lead by example’ was the liberation of Iraq,’’ Mr. McCain said. “And if he really thinks that, by liberating Iraq from a dangerous tyrant, America somehow set a bad example that invited Russia to invade a small, peaceful, and democratic nation, then he should state it outright – because that is a debate I welcome.’’

1.  Of course it helps if we are leading by example on that point.’   I can not think of anything closer to the truth.  Since unprovoked war with Russia is out of the question, how else can you rally the rest of the world to join the US in objecting to Russia’s use of military force?  Although not part of this speech, a wise man would consider the US abrogation of the ABM treaty and the deployment of missiles and radar on Russia’s boarders as a provocative move by the US.  Provocations usually get responses.

2. our failure to ‘lead by example’ was the liberation of Iraq,’’  We can now see the delusion setting in.  Instead of calling the Iraq fiasco “an invasion and occupation” which it has been, McCain attempts to glorify it.  Please remember, no one, including the UN asked the US to undertake regime change (I stand corrected, Isreal did strongly recommend regime change, but Israel is hardly a neutral party).  Please also remember that “liberation” was not the Bush Administration’s justification for the invasion and “liberation” from a bad person came only after it was clear that there were no nuclear weapons, no other WMD, or any ties between Iraq and al Qaeda.

3. a bad example that invited Russia to invade a small, peaceful, and democratic nation,  The Republic of Georgia is certainly small and apparently did have democratic elections.  It should not be characterized as peaceful, however.   With US backing and training of its military, Georgia had been agitating and conducting small scale military actions against two provinces Georgia claimed were part of their home country.  Not surprisingly, the Abkhazians and the South Ossetians do not see Georgia’s claim the same way. 

The desire of John McCain to lure Barack Obama into a foreign policy/national security debate is understandable.  With rhetoric like this, Obama approach of avoiding conflict will appear weaker than McCain’s “shout louder and hope for the best” approach.  Where were the follow up questions for McCain like what has the Iraq invasion and occupation cost the American tax payer, or when will the Iraq “liberation” end and our troops brought home, or who in addition to “al Qaeda in Iraq” and Iran will be the really big beneficiaries of our “liberation”?

Another Dimension of the Cockup

August 26, 2008

Russia’s parlament has given its ok to a secessionist movement by South Ossetia and added more light to just how short sighted the Bush Administration has been.  This should may come as a surprise to anyone who believed Iraq had nuclear weapons or other WMD, or even more ridiculously, had any involvement with 9/11.  In 2000, when a new world order was emerging, lead by China and India, and there were vast regions of the world headed by lawless governments, the Bush Administration chose not to build global alliances with developed countries including Russia and ready itself for a global economic competition while working on world peace with its allies.  Instead, Bush and his chicken hawks associates, took aim at their left foot and shot quickly.  We have now wasted 8 years and have helped build walls of isolation.

Reviewing the Bush moves:

  • Abrogated the ABM treaty
  • Restarted “Star Wars”
  • Began deployment of “Star Wars”
  • Invaded and occupied Iraq
  • Signed agreements with the Czech Republic and Poland to house radar and missiles
  • Helped invite all of Russia’s European neighbors to join NATO
  • Inspired and recognized Kosovo’s independence from Serbia.
  • Made the Republic of Georgia a poster child for democracy.
  • Encouraged Georgia to taunt the Russians, and then was unable to pull Georgia back from its provocations against Russia.

The Russian reaction to Georgia’s foolish invasion of South Ossetia was predictable and easily foreseen.  It might have all stopped there were it not for the US delight in recognizing Kosovo over strong Russian objections.  Now Russia has a chance for some revenge. 

At a time when Russia could be better watched and maybe even developed as an ally, Bush and friends have backed the bear into a corner and Russia’s reaction is predictable.  Barack Obama or John McCain will have much to thank President Bush.  The next Administration had better recognize that Russia has new found economic might (from vast energy holdings), lots of arms and munition factories, and relatively little ethical constraints to use these tools to support their national interests.

Shamefulness in Broad Daylight

August 25, 2008

Today the Democratic convention opens in Denver and all eyes (well, maybe not all) will be on proceedings that will culminate with Barack Obama being officially named the Democratic Party standard bearer.  Several States away in California another story is brewing and is not a pretty picture.

The California ballot will include a referendum this fall that if adopted will change the state constitution specifying that marriage is between a man and a woman only.  With all the problems facing America (and Californian too) today you must really wonder what they are smoking to worry about that issue. 

You might understand an argument that marriage is about tax advantages and unless a couple can biologically produce off-spring, they should not be entitled to these tax advantages.  (I am not saying that is a sound position, but at least there is a basis to debate it).

The actual argument being championed by Catholics, Mormons, and evangelicals speaks to the Bible and immoral life style of gays and lesbians.  Again one can understand a visceral reaction to homosexual behaviors although I had always heard that anything goes in California.  The aspect that is incomprehensible is that leaders of these churches are suppose to be trained in theology and human nature.  Gays and lesbians have been around since the dawn of civilization and will be here for the future too.  They simply are who they are, because they are who they are.  They are human beings just like the rest of us. 

For those gays or lesbians who want a committed relationship, why should they not be accorded the same legal protection as straight couples?  And above all, why shouldn’t gays and lesbians who marry face child support and allimony if they divorce, just like everyone else?

I suspect the church support of this constitutional change is motivated by the age old “profit motive”.  By making gays and lesbians (a 10-13% minority) the villians, “for profit” church leaders can rally support for their own enterprises (read gain more donations). 

Every day people who get caught up in the frenzy of “marriage is only for man and woman” gains nothing, absolutely nothing.  If you consider the cost of the election and the lost opportunity cost associated with any attention given this issue, every day citizens are actually losers no matter how the vote turns out.

It is high time that this shamefulness in broad daylight ends.

For Better of Worse

August 24, 2008

Barack Obama has picked his Vice President running mate and with his selection of Senator Joe Biden the last of the mysteries has been revealed.  The pick may also say a lot about Obama.  He has picked an older and more experienced person and one who knows his way around the corridors of Congress as well as anyone.  It is not unfair to say that Biden could have headed the ticket and Obama could have been his VP.  Things simply did not work out that way.

Experience alone is not the only or even the most important criteria for being a successful President.  George W Bush was a former Governor and that was supposed to confer executive experience on him.  As we have seen none of it rubbed off on George.  The Obama Presidential “bet” we are being asked to make, is based upon leadership and personal values.  Supporters see a man who can motivate, inspire, and manage in a positive way, others.  Obama should be able to bring forward great thoughts from others and get still others to embrace these ideas and put them to work.  Biden has shown a level headedness and ability to see the really important things from the many that crowd our world.  During the Democratic debates, it was Biden who did not bite at the Iran bait and puff up his chest with a “I will crush them” statement.  Rather he said that while Iran was troublesome, the real place for our concerns was Pakistan who already had nuclear weapons, had already shared this know-how in the past, and was a troubled democracy with all sorts of radical groups ready to change the government.  This ability to see what is more important than something else is today a rare gift amongst our politicians and media pundits.

Joe Biden does not come 100% without some stains.  So far there have been no mention of financial irregularities and his excursion into some of the rhetoric of England’s Neil Kinnock is in the past.  Biden is not a “group think” person nor should we expect him to run a second White House like Dick Cheney.  All in all, if it could not be Hillary, Biden is a good choice.

What’s After the Recession?

August 23, 2008

The question of the day has two parts.  First, when will this recession end, and second, what will follow.  If anyone is thinking that it will be solid growth with results that look like those we have seen in China during the Olympics, forget it.  But it is reasonable to ask why not.

The recession is here for a while and is unlikely to bottom out until there is reason for the country to have confidence again in their government.  That will not happen, at the earliest, until after the election and I would guess it will be a good six months after the bottom out before economists tell us the worst is behind.  Unfortunately after 8 years where the average wage earner’s income did not increase, the light bulb must be going on that something more will be needed to revisit the Clinton years where all boats rose.  Be sure of one thing, further tax cuts and a blind eye to building the “commonwealth” is not the path to a better future.

Following the election, we need a bipartisan review of the economy and what measures are needed short and long term.  Simply returning to more excessive profits and huge bonuses by Wall Street banks and investment houses is not in America’s best interest.  China has an export mentality with a highly developed infrastructure.  It has a business friendly climate and grants a wide path for innovation.  It honors education and science and looks for ways to put them to work. 

To be sure, America is a more mature country and has already done once many of the things that China is doing today.  But why not do it again?  With the right leadership and “tone at the top” from the next Administration, America can get back on the right path.  The path will not be a speedway given the current dismal monetary and fiscal mess that Bush/Cheney have produced.  The next Administrations needs to act sensibly and this will mean increasing taxes in order to develop more government revenue.  We need to spend much more wisely than Bush has.  We need another “peace dividend” where the current bloated defense budget is reduced by $100 billion off the top and the unbudgeted costs of Iraq and Afghanistan need to be reduced by another $75 billion.  With wise investments we can lay the foundation for a real growth based upon bricks and mortar and not CDOs

Good Government

August 22, 2008

Does the desire for “good government” sound like a lot to ask for?  Is that not the “American Way”?  Why then do I have this awful feeling about the upcoming Presidential election?  Could it be that we will be extremely lucky if the Administration that follows the most incompetent and mean spirited Bush/Cheney Administration will provide good government.   Why do I say that?

1. John McCain has campaigned on much of the Bush policies and promised to extend those policies for another 4 years.  To get good government one needs worthwhile policies and very good execution of them.  McCain is not a detail person, so why should I expect him to begin being an executive at age 72?

2. Barack Obama has campaigned on the theme of change and we all infer it means change from George W Bush’s policies.  While encouraging, we have little information on what the new policies will be and even more important, how we can afford them. 

3. Both Obama and McCain have received huge amounts of money from special interests and have surrounded themselves with Washington insiders, consultants, and lobbyists.  With Presidential campaigns costing (including primaries) over a half billion dollars, there seems to be no other way.  Unfortunately the “insiders, consultants, and lobbyists” have no particular interest in “good government”.  (Please note that I am not saying they prefer “bad government” but rather they are in business to make money for themselves either with Obama or McCain, or with whomever the next candidate might be.  How the government runs is not their problem, they think.)

If there ever was a need for a third party dedicated to the efficient and effective operation of government, it is now.  Our fiscal and monetary policies are non-existent.  Our controls over the banking, investment, and credit card industries are inadequate and have encouraged dangerous increases in debt related risk.  The general climate that stimulates and allows the American economy to grow so that all can share is absent.  And most of all there seems to be no notion that a good tide lifts all boats.

Alas there is no third party.  And the Republicans have, in my opinion, forfeited their right to a third Bush term and John McCain is hardly fit temperamentally to become commander in chief.  So we are left with Barack Obama and the “hope” he will rise to the responsibilities of the job. 

Do not mistake this as a choice.  John McCain and his Supreme Court choice preferences are non-starters.  His promises to lower taxes and reduce spending is like a family head taking a half time job so that he has more time to play golf.   To make up for the lost income, he cuts his food purchases thereby feeding his children less and takes that money so he can play more golf.  This is no choice.

Where is Mike Bloomberg when we needed him?