Whiskey Bar: The Politics of Scarcity: "It's a little disconcerting to think that gas prices — not Iraq, not Katrina, not the extra-constitutional power grabs — could decide whether Shrub's presidency recovers or collapses into complete irrelevancy for the next three years. "
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Tuesday, April 25, 2006
Monday, April 24, 2006
Economic hazards
The Carpetbagger Report » Blog Archive » 'Having trouble' at Treasury: "Rumor has it that Treasury Secretary John Snow will get the boot any day now. Part of the problem, apparently, is that the White House is reportedly 'having trouble' finding someone qualified who wants the job. That's not a good sign."
My previous post tried to riff off of Krugman's latest "things are worse than they appear" column on the trade deficit, to make the case that Bush economic policy could result in a meltdown and a political storm.
On the economic front, things are bad, but not acutely bad, and so not "obviously" bad, to the citizen or voter, who is not paying much attention. The U.S. is on an unsustainable course, as they say, living beyond its means and failing to renew its infrastructure. It is hard to know when the crisis will come, or even if a crisis will come. Things may just continue to deteriorate gradually, and various political narratives will be generated by the right-wing corporate media, which will blame inevitable abstractions, like globalization, about which government policy can do nothing.
The gradual decline in median household incomes has been small; it adds up, of course, but it is not dramatic and acute, and so, a political crisis never comes.
But, there is some non-zero chance that an economic crisis will come, in the Bush administration. And, one of the reasons is that Bush has no competent people in key economic policy positions. Snow, the Treasury Secretary, is an incompetent, and, on the second tier at Treasury, a lot of offices are simply empty. If there were a shock to the system, the Administration might not be able to contain it, and, in fact, might actually respond in a way, which made a small shock into a full-blown crisis.
The housing bubble has burst, and the yield curve has been inverted, and oil prices are rising. At the very least, an economic recession has to be regarded as highly likely. The possibility of a political or meterological event causing a spike in oil prices has to seem probable, and the possibility of a dollar crisis has to appear no longer remote. These are circumstances, which even an Administration lousy with technical, economic competence could screw up.
My previous post tried to riff off of Krugman's latest "things are worse than they appear" column on the trade deficit, to make the case that Bush economic policy could result in a meltdown and a political storm.
On the economic front, things are bad, but not acutely bad, and so not "obviously" bad, to the citizen or voter, who is not paying much attention. The U.S. is on an unsustainable course, as they say, living beyond its means and failing to renew its infrastructure. It is hard to know when the crisis will come, or even if a crisis will come. Things may just continue to deteriorate gradually, and various political narratives will be generated by the right-wing corporate media, which will blame inevitable abstractions, like globalization, about which government policy can do nothing.
The gradual decline in median household incomes has been small; it adds up, of course, but it is not dramatic and acute, and so, a political crisis never comes.
But, there is some non-zero chance that an economic crisis will come, in the Bush administration. And, one of the reasons is that Bush has no competent people in key economic policy positions. Snow, the Treasury Secretary, is an incompetent, and, on the second tier at Treasury, a lot of offices are simply empty. If there were a shock to the system, the Administration might not be able to contain it, and, in fact, might actually respond in a way, which made a small shock into a full-blown crisis.
The housing bubble has burst, and the yield curve has been inverted, and oil prices are rising. At the very least, an economic recession has to be regarded as highly likely. The possibility of a political or meterological event causing a spike in oil prices has to seem probable, and the possibility of a dollar crisis has to appear no longer remote. These are circumstances, which even an Administration lousy with technical, economic competence could screw up.
Sunday, April 23, 2006
Paul Krugman: Things are worse than they seem
Economist's View: Paul Krugman: CSI Trade Deficit: "Right now, forensic analysis seems to say that the U.S. trade position is worse, not better, than it looks. And the answer to the question, 'Why haven't we paid a price for our trade deficit?' is, just you wait."
Bush Administration economic policies have been singularly ill-advised. And, they will have consequences.
But, those consequences, although certainly "bad", may not be sharp, or particularly soon. And, it is difficult to anticipate what narrative may be attached. The American middle class has seen the Republicans chipping away at their income and security for decades.
There is some non-zero chance, though, that a vicious circle is about to be triggered.
Trade is a big part of that. The country is living beyond its means. In quantitative terms, the American standard of living is about 6% hot air. If the hot air passes out of the bubble slowly, it might not be much noticed. If the bubble bursts, and we lose that 6% over some short period of time, people will very much notice.
Bush Administration economic policies have been singularly ill-advised. And, they will have consequences.
But, those consequences, although certainly "bad", may not be sharp, or particularly soon. And, it is difficult to anticipate what narrative may be attached. The American middle class has seen the Republicans chipping away at their income and security for decades.
There is some non-zero chance, though, that a vicious circle is about to be triggered.
Trade is a big part of that. The country is living beyond its means. In quantitative terms, the American standard of living is about 6% hot air. If the hot air passes out of the bubble slowly, it might not be much noticed. If the bubble bursts, and we lose that 6% over some short period of time, people will very much notice.
nastier, poorer, weaker, dummer
The Blogging of the President: "It will be a nastier, poorer, weaker, meaner, dummer America. But that is what Americans want, because that is what they have voted for repeatedly for a generation. Like Madison, I regard anything that repeated majorities desire as de facto constitutional, even if I would rather not live under it."
Keeping Control
Talking Points Memo: by Joshua Micah Marshall April 23, 2006 04:58 PM: "Keeping control of the House and the Senate is less a matter of conventional ideological and partisan politics as it is a simple matter of survival."
Theirs and ours, Mr. Marshall.
The Republicans will do whatever they have to hold onto control of the House and Senate.
Chances of losing control of the Senate are, unfortunately, remote, while the chances of a change in the House are only marginally better.
But, supoena power in the hands of Democrats could become a jawbone in the hand of Samson.
Theirs and ours, Mr. Marshall.
The Republicans will do whatever they have to hold onto control of the House and Senate.
Chances of losing control of the Senate are, unfortunately, remote, while the chances of a change in the House are only marginally better.
But, supoena power in the hands of Democrats could become a jawbone in the hand of Samson.
Tuesday, April 18, 2006
Bush: 'I'm the decider'
CNN.com - Bush: 'I'm the decider' on Rumsfeld - Apr 18, 2006: "I'm the decider, and I decide what is best. And what's best is for Don Rumsfeld to remain as the secretary of defense."
Sunday, April 16, 2006
The Flight Forward
Whiskey Bar: The Flight Forward:
"For Bush, or the neocons, or both, regime change in Iran not only may appear doable, it may also look like the only way out of the spectacular mess they have created in Iraq.Billmon is making way too much sense, here.
The logic is understandable, if malevolent. Instead of creating a secular, pro-American client state in the heart of the Middle East, the invasion of Iraq has destroyed the front-line Arab regime opposing Tehran, installed a pro-Iranian government in Baghdad and vastly increased Iranian influence, not only in Iraq, but throughout the Shi'a world. It's also moved the Revolutionary Guard one step closer to the Kuwaiti and Saudi oil fields – the prize upon which the energy security of the West depends.
By the traditional standards of U.S. foreign policy, this is a fiasco of almost unbelievable proportions. More to the point, the neocons may believe that unless they can do something dramatic to recoup those losses, they won't be able to safely withdraw large numbers of troops from Iraq, since they are A.) the only remaining source of U.S. influence in the country and B.) the only shield against Iranian infiltration of both Iraq and the Shi'a majority regions of Saudia Arabia and the Gulf emirates. Yet the military need for such a draw down becomes more critical with each passing day, as the all-volunteer Army is stretched towards its breaking point.
In other words, the administration, and the Pentagon, have gotten themselves into one hell of a jam – militarily, strategically and politically. As desperate and reckless as attempted regime change in Iran might seem to us, to the Cheneyites it may look like the only move left on the board.
Hersh suggests the neocons have convinced themselves that an air campaign against Iran would quickly lead to a popular rebellion and the overthrow of the Islamic Republic. Perhaps this is so, at least for the gullible and the ignorant among them (such as Bush.) Drowning men, after all, will clutch at straws.
a move against Iran might be preceded by a major troop drawdown in Iraq (which, if my analysis is correct, would itself make war with Iran a strategic necessity in the eyes of the neocons.) Or it may be that Rummy and the gang intend to push through another of their 'minimalist' invasion plans (which may be one reason the chorus of military complaints about Rummy has risen to a howl.) Either way, it should not be assumed that the neocons are going to act in a military rational way. That's not what the flucht nach vorne [flight forward] is all about.If Billmon is right, American Empire is about to flame out in record time.If anything, the same goes double for our boy king. If the institutional temptation for the neocons to seek redemption in a flight forward is powerful, the psychological motivations for Bush may be overwhelming. In his story, Hersh refers to Bush's alleged desire to make "saving Iran" from the Shi'a Hitler his legacy. But saving Iraq from the Baathist Hitler was orginally supposed to be his legacy. This is doubling down on a historically grand scale.
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