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"The road is cleared," said Galt. "We are going back to the world." He raised his hand and over the desolate earth he traced in space the sign of the dollar.
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7:00 pm EDT
Tuesday, January 6
Unindicted co-counterconspirator-in-chief Donald Luskin will appear on CNBC's Kudlow & Company. Don will be debating Peter Schiff -- yes, sigh, Peter Schiff -- about the future of the economy and the markets.
Chronicle of the Conspiracy
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Tuesday, January 06, 2009
THE GANG FROM THE "111"
My DC-insider friend "Mick Danger" is back in town with the new Congress, and files this post-holiday post-partisan report:
The 111th Congress begins today.
Democrats in the Illinois legislature shied away from a special election for the open U.S. Senate seat, reportedly because they feared a competitive race by Republicans. Stepping up in that vacuum, Illinois's tainted Governor legally appointed Roland Burris, a man whom Harry Reid won't seat.
Meanwhile, Al Franken was "certified" in a process where the only certainty is that those counting the ballots are accused of fixing the outcome before it's finished reviewing ballots from all of Minnesota's counties.
So, you can't get into the Senate if you have cooties but you should get in the Senate if an obviously suspect, incomplete process which is still under litigation "certifies" you.
Over in House, things are so much clearer. What says Nancy on her big day? We need less transparency and debate! Abolish political speech! Banish the bastards!
Well, true she's not saying that, but she's doing that. Why else remove the measly procedural rights of the shrunken House Republican minority? Some House Democrats point angrily at "abuses" last year when Boehner passed dozens of procedural votes to stop, or slow, the Democrats' production line! Wait, since Republican amendments can't pass without votes from moderate and conservative Democrats, whose rights are being trampled? (All but those of the most liberal voters.)
Check the numbers: Nancy now presides over 257 Democrats; last year she had 235.
While Harry dances with Stuart Smiley and dodges Bobby Rush, and Obama brushes up on Hamas and cutting taxes for non-taxpayers, Nancy is asserting control over policy in Washington. Just ask Rahm Emanuel, President-elect's designated Chief of Staff, whom she "warned" only to cut deals with her -- no going around her to cut deals with Members of the House. What does she thinks she is, a single-payer health czar?
Linda Fowler, a political science professor at Dartmouth College, voiced a word of caution. "A Democratic majority doesn't necessarily mean a compliant Congress,“ she said, citing problems that Democratic Presidents Jimmy Carter and Bill Clinton had with legislatures held by their parties."
Ah, no, Linda. Nancy wasn't Speaker then. Back then, each Member of Congress was considered first a representative of their district and only secondarily a party member. The rules protected greater freedom to offer amendments and vote on them. Sure, there was "party discipline" and even real "abuse." But neither Speaker Tip O'Neill (Carter) nor Speaker Newt Gingrich (Clinton) fixed two years of legislative process on Day One.
Ain't "post-partisan" fun? Bottom line: Watch Nancy. She's more Machiavellian than any other single politician in town.
KUDLOW REPLAY
Here's the YouTube video of tonight's hit. Oops! Just what could I mean when I say stocks in November were "deeply undersold"? And, hey, what does Zachary Karabell mean when he says that following me is like going "from the t-shirt to the tie"? Should he at least straighten his ties, if he's going to draw attention to it? If not, he should wear a spiffy Speed Racer t-shirt like me.
BIG GOVERNMENT NEVER NEEDS JUSTIFICATION
From Paul Krugman'scolumn this morning:
The biggest problem facing the Obama plan...is likely to be the demand of many politicians for proof that the benefits of the proposed public spending justify its costs — a burden of proof never imposed on proposals for tax cuts.
Huh? It's a "problem" that costs should have to be justified? Would Krugman prefer the imposition of costs by government virtually at will, with no rationale, no reason, no purpose, no justification, just whim?
And as to his idea that tax cuts don't apparently need to be justified, reader John Muraro says, "Yeah, that pesky moral claim individuals make to the results of their labor really does complicate life for the central planning set."
Via Paul Kedrosky, thanks to our correspondent "Irrational Exuberance."
Update... A reader tells me, yes, I need to say more. First, I put a link under "Kedrosky," above, as I should have originally -- but here's my take. This is a Google Trendschart, showing the number of times a particular search term -- in this case "Peter Schiff" and "peak oil" -- show up on the web, through time. The idea is that during the last year of economic turbulence, certain ideas gained temporary dominance in the collective mind. In the summer when oil was at $147 a barrel, you got lots of people on the web raving about how we're running out of the stuff, that we've passed the time of "peak oil." Similarly, more recently, when volatility in the stock market has been more on people's minds, we find they no longer want to talk about "peak oil" -- gone! forgotten! problem solved! -- and instead the want to hear the end-of-the-world sermonettes of Savonarolas like Schiff. Looks like we've seen "peak peak oil" and "peak Peter Schiff." Time to move on to some other dumb thing to focus on, I guess.
KUDLOW REPLAY
But no Kudlow on duty. So I'm left to have a silly debate with a soi-disant"well-established specialist in the Austrian School of economic theory." It's more like the Vietnamese school -- destroy the economy in order to save it. Have a listen, here' the YouTube video. Sick stuff.
IS THIS A JOKE?
From the New York Fed's web site, part of an FAQ explaining the central bank's new program to buy mortgage-backed securities:
Does the agency MBS program expose the Federal Reserve to increased risk of losses?
Assets purchased under this program are fully guaranteed as to principal and interest by Fannie Mae, Freddie Mac, and Ginnie Mae, so the Federal Reserve's exposure to the credit risk of the underlying mortgages is minimal.
Michael Alix has been named a senior vice president in the Bank Supervision Group of the Federal Reserve Bank of New York... Most recently, Mr. Alix worked for the Bear Stearns Companies, Inc., where he served as chief risk officer from 2006-2008 and global head of credit risk management from 1996-2006.
MCLEAN, Va., Dec. 29 /PRNewswire-FirstCall/ -- Freddie Mac (NYSE: FRE) today named Raymond G. Romano as the company's chief credit officer, a position that is responsible for enterprise-wide credit risk management activities.
TAX CUTTING DEMOCRATS
Here's some good news. Amazing how tax-breaks for fat-cat investors is okay with Democrats when they are in power.
Congressional Democrats are seeking to...make so-called private-activity bonds more attractive by exempting the interest on them from the alternative minimum tax. Richard Neal, chairman of the House Ways and Means subcommittee that drafts tax measures, wants to include the plan in economic recovery legislation that President-elect Barack Obama has made a top priority.
“I am hopeful that my bill, which will increase demand and lower costs for state and local governments, will be a central feature of our stimulus bill next month,” said Neal, a Massachusetts Democrat.
Neal’s proposal would reverse 23 years of policy. It aims to increase demand for private-activity bonds by mutual funds and individual investors who often avoid them because of the higher taxes and complicated paperwork under the alternative minimum tax.
Neal’s bill is one of at least three proposals favoring the municipal bond market gaining steam as Democrats seek ways to fulfill Obama’s promise to steer federal funding to infrastructure projects as part of a stimulus package worth as much as $850 billion over two years.
In Monday’s newspaper, we published a letter over the name of the mayor of Paris, Bertrand Delanoë, criticizing Caroline Kennedy. This letter was a fraud and should not have been published. Mr. Delanoë’s office has since confirmed that he did not write it.
Printing the letter, which also appeared on nytimes.com until it was removed, violated the standards and procedures of The New York Times editorial department.
It is our practice to verify the authenticity of every letter we publish. Like most of our letters these days, this one arrived by e-mail. We sent an edited version back to the writer of the e-mail and did not receive a response.
At that point, the letter should have been set aside. It was not.
The Times has expressed its regret to Mr. Delanoë’s office for the lapse in judgment that led to this error. We now express those regrets to our readers.
We will be reviewing our procedures in an attempt to ensure that an error like this is not repeated.
Another error. As of this posting, the letter has not in fact been removed from the Times' web site. It can be found by clicking here. Assuming it will be removed later, following is the entire text, including an earlier version of the correction. I guess the bit about "American decline" was irresistible to the Times.
Letter Kennedy, Seen From Paris
Published: December 22, 2008 Editors' Note Appended
As mayor of Paris, I find Caroline Kennedy’s bid for the seat of Senator Hillary Rodham Clinton both surprising and not very democratic, to say the least. What title has Ms. Kennedy to pretend to Hillary Clinton’s seat? We French can only see a dynastic move of the vanishing Kennedy clan in the very country of the Bill of Rights. It is both surprising and appalling.
With all the respect and admiration I have for Ms. Kennedy’s late father, I find her bid in very poor taste, and, after reading “Kennedy, Touring Upstate, Gets Less and Less Low-Key” (news article, Dec. 18), in my opinion she has no qualification whatsoever to bid for Senator Clinton’s seat.
We French have been consistently admiring of the American Constitution, but it seems that recently both Republicans and Democrats are drifting away from a truly democratic model. The Kennedy era is long gone, and I guess that New York has plenty of more qualified candidates to fill the shoes of Hillary Clinton. Can we speak of American decline?
Bertrand Delanoë
Paris, Dec.18, 2008
Editors' Note: December 22, 2008
Earlier this morning, we posted a letter that carried the name of Bertrand Delanoë, the mayor of Paris, sharply criticizing Caroline Kennedy.
This letter was a fake. It should not have been published.
Doing so violated both our standards and our procedures in publishing signed letters from our readers.
We have already expressed our regrets to Mr. Delanoë's office and we are now doing the same to you, our readers.
This letter, like most Letters to the Editor these days, arrived by email. It is Times procedure to verify the authenticity of every letter. In this case, our staff sent an edited version of the letter to the sender of the email and did not hear back. At that point, we should have contacted Mr. Delanoë's office to verify that he had, in fact, written to us.
We did not do that. Without that verification, the letter should never have been printed.
We are reviewing our procedures for verifying letters to avoid such an incident in the future.