I will not celebrate meaningless milestones…

2009/04/30

Okay, in all fairness, I would not be celebrating, even if this were a meaningful milestone. I speak, of course of the artificial “milestone” created for the first 100 days of our new President’s “historic” term in office. Anyone who has read my prior posts should already have a decent idea of why I have no interest in celebrating. Of course, there was very little ignoring the fact, what with the major media outlets constantly droning on about how “historic” the day was, and our President himself indulging in an hour-long hot air session on all but one of the major networks in primetime. So much for not making a big deal out of the day. [1] And meanwhile, the national situation continues to improve; here are a few matters that were not nearly as newsworthy as the President’s continuing campaign.

  • The two houses of Congress have agreed upon a compromise version of the FY 2010 national budget, which will top out at 3.44 trillion USD. [2] The President has previously stated that he and his administration are committed to making tough decisions to cut down on the cost of the goverment doing business, most recently at his marketing seminar, er, press conference yesterday. [3] Given that this figure is roughly 30% greater than the highest budget expenditures under the collusion of the Bush II White House and GOP-dominated Congress, [4] I find it difficult to accept the arguments from the President and his sycophants that the Republicans are the masters of irresponsible spending, or that the current administration has made any “tough” choices regarding the budget figures. But maybe I’m just reading things the wrong way; perhaps, if I turn the pages upside-down, and read them in a mirror…
  • Senate Democrats are now one vote shy of being able to do what they want, when they want, without fear of having to listen to opposing arguments against their proposals. [5] Of course, the President and Congressional Democrats were quick to downplay the potential for using the bludgeon to get their way, but when push comes to shove, would they really be willing to negotiate with the opposition, when they really does not need these opposition votes to get what they want? Why compromise with your sworn enemy, when you could just steamroll through without them?
  • On a related note, Congressional Democrats have also indicated their willingness to use so-called reconciliation rules to fast-track legislation, while limiting the possibility for debate and/or filibustering (though with a near filibuster-proof majority, they may not have to bother with even this), while the White House fully supports this move (not surprising, considering that it will help the President dictate his will to Congress). [6][7] So far, only two of the President’s more contentious demands are currently up for fast-track legislation: health care and education. There are, however, rumors that climate change legislation is on its way there, too. [8] But then again, who really needs that whole separation of powers thing? Its so old, and the Founding Fathers really didn’t know what they were doing back then, did they?
  • The economy continues its backslide, though this is one area where I cannot fault the President and his cronies too much; it takes time for any policy changes to trickle down into the economy at large. Still, unemployment numbers continue to be abyssmal, growing pretty substantially during March. [9] Again, this is not so much the President’s fault, but still, it does not bode well, either.
  • Additionally, Chrysler has begun filing for bankruptcy. [10] The President does not consider this a failure for the company; I find this position amusing, as one of the primary reasons for filing bankruptcy is that the company is not performing successfully. I suppose there are other terms one might use for the opposite of success, but failure is one of the more commonly used terms. Perhaps we should leaf through a thesaurus to find the least uncomfortable term.
  • More than this, much of the credit market remains frozen, “toxic” assets are still on various lenders’ books (with few people having any idea what to do about them – almost nine months after this crisis began), and there is anecdotal evidence to suggest that the stimulus money, for all its hype, is either not yet reaching those that need it, or just now getting there. At best, this means that it may be many more months before the effects of the stimulus bill (if any) are felt. It also undermines, to some extent, the contention from supporters of the stimulus package that quick and decisive action was absolutely necessary at the time, regardless of whether or not the initiatives involved had a known or only hypothetical potential to create jobs and stimulate the economy. But I suppose that the President and Congress will get around to resolving this situation. Eventually.
  • Meanwhile, the Vice President seems to think that it is prudent to encourage the public to panic. And the White House is scrambling to make it sound like he didn’t really mean to say that. [11] Alright, to be fair, this one really did amuse me, mainly for how absurd and ill-informed the comments were.

As I said, there’s plenty to worry about going on, but I am still not hearing too many detailed answers from either the President or Congress for the various problems that our nation is facing. Oh sure, they’ve got plenty of ideas, but nobody seems interested in providing hard evidence that any of these ideas are good ideas. Ah well, I suppose we will know soon enough. Its not as though they’re experimenting with everybody’s money and with the future of the nation. Oh, right.

Notes:

[1]: CNN article, 29 April 2009. Note the comparison of the occasion to a “Hallmark holiday,” while simultaneously insisting that the administration is powerless to downplay the significance of it.

[2]: CNN article, 29 April 2009.

[3]: Transcript available here; AP transcript, 29 April 2009.

[4]: Historical budget information available here, from the Congressional Budget Office website (PDF warning). For FY 2006, the total amount spent amounts to 2.655 trillion USD; given that the Democrats held majorities in Congress for the last two years of Bush II’s presidency, I do not consider these two years to be indicative of the results of Republican collusion between Congress and the White House (of course, both years’ budgets were higher still than FY 2006). In any event, the difference between the FY 2006 budget and the FY 2010 budget is 785 billion USD, which is 29.6% of 2.655 trillion (3,440,000,000,000 – 2,655,000,000,000 = 785,000,000,000; 785,000,000,000 / 2,655,000,000,000 = 0.2957; 0.2957 x 100 = 29.6%).

[5]: Otherwise known as the filibuster, which, while much maligned, has historically been considered a check against the ability of the majority to tyrannize the minority in the Senate. U.S. News and World Report article, 30 April 2009.

[6]: Christian Science Monitor article, 29 April 2009.

[7]: Wall Street Journal article, 27 April 2009.

[8]: McCook Daily Gazette article, 30 April 2009.

[9]: CNN Money article, 29 April 2009.

[10]: CNN Money article, 30 April 2009.

[11]: CNN Political Ticker article, 30 April 2009.

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One Response to “I will not celebrate meaningless milestones…”

  1. MI Says:

    1. Does that budget total include a) the stimulus; and b) TARP & other bailouts? If so, and if one considers automatic stabilizers, then much of the budget total becomes explicable. Of course, I’m increasingly of the opinion that discretionary fiscal stimulus is imprudent (I don’t mind automatic stabilizers like unemployment insurance & food stamps).

    2. Although cognizant of the dangers of tyranny of the majority, I’ve always been somewhat ambivalent about the filibuster, which frankly strikes me as unconstitutional.

    3. Regarding the economy – the impression I get is that the pace of economic decline is slowing. Which is a plus; a non-negative second derivative is the first step towards bottoming out (and eventual recovery). Of course, given the private sector’s massive debt load, I’m not sanguine about the probable strength of said recovery.

    4. Re. Chrysler’s BK, methinks Obama’s announcement is just talk. Whatever he says, he probably realizes the probable risks & costs associated w/ BK; if he really didn’t consider this a failure, then why were they pressing so hard for either a pre-pak BK or a restructuring outside BK?

    5. The credit markets are somewhat healthier than back in Oct., but that’s not saying much; they still require the life support provided by various Fed facilities & government guarantees (e.g., FDIC bonds) to function properly – which wouldn’t be the case w/ a healthy financial system. Re. the Geithner Hedge Fund…my hope remains “success through failure” – i.e., that even w/ federal sweetheart financing, the participating private investors still make realistic bids for toxics, and the banks (rationally) reject them lest they suffer massive blows to capital. This would, at least, finally kill the argument that this is merely a liquidity – not a solvency – crisis (*), and hopefully thereby clear the way for measures aimed at resolving insolvent banks. But I’m not confident that Obama et al are really that clever….

    (*) See http://www.housingwire.com/2009/03/30/a-ppip-of-a-plan-or-just-a-big-light-show/


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