Obamanomics: Unicorns, rainbows and wasteful neo-Keynesian nonsense

But mostly wasteful neo-Kenynesian nonsense! While Obama and his lapdogs promote their "stimulus" plan in terms of "needed investment in our nation's infrastructure," in fact only 3% goes to roads and bridges:

The recent proposal distributed by congressional Democrats will provide only an additional $15 billion in 2009 and 2010 for road construction and repair. And of that $30 billion total provided, some funds are earmarked for narrow uses such as technology training or construction of roads on Indian reservations and in national parks.
According to those calculations, that’s just a little more than 3 percent meant to be spent on actual road and bridge construction.

Sen. Jeff Sessions is taking the lead in pointing out the media-generated myth that the stimulus will be used to fix "crumbling" roads and bridges. And let's face it: Robert Reich is right -- Democrats don't want to spend taxpayer money to create jobs for a bunch of blue-collar honky construction workers. Via Newsbusters, here's video of how media idiots are hyping the "crumbling infrastructure" meme:

What's really in the Democrats' "stimulus" bill?

In a conference call on Jan. 23, House Minority Whip Rep. Eric Cantor and [Texas Rep. Jeb] Hensarling pointed out some of the more egregious spending provisions in the House Democrat proposal:

• For every dollar that is spent for small business tax relief, $4 are being spent for the maintenance and new grass in Washington, D.C.
• $360 million for sexually transmitted disease education
• $50 million for the National Endowment of Arts
• $726 million for an afterschool snack program
• Office furniture for the public health service
• More money for Amtrak

"How any of this fits under the banner of economic stimulus is beyond me," Hensarling said. "I think it would prove to be beyond the American people as well."

STD education? Amtrak? Whiskey Tango Foxtrot? Welcome to the neo-Keynesian universe, where every penny of government spending is coated with economic pixie dust that magically creates jobs. I'd like to hear Paul Krugman try to explain how it makes sense to throw borrowed money at a notorious ripoff like Amtrak.

And for the love of God: More money for the National Endowment for the Arts? What? To give grants to unemployed street mimes? I've got a better idea: Send the mimes to perform for detainees at Guantanamo Bay.

They think waterboarding is torture . . .

UPDATE: Linked at Caffeinated Thoughts.

2009 Year in Review: January

Looking back through the archives, I note that this annus horriblis began with the sad realization that we were going to have to get used to saying those three dreadful words: Senator Al Franken. Which, of course, prompts three more words: Whiskey Tango Foxtrot?

Exactly what is wrong with the Republican Party that it can't even beat a clown like Franken? I attempted to answer that question in a long post titled, "Fear and Loathing: Sarah Palin and the Conservative Intellectuals":

Just as the conservative intellectuals once projected their hopes onto Dubya, now they project their disappointments onto Sarah. But the fault is theirs, not hers.

It is a very long post, but I think it got to the nub of some very important issues that are fundamental to understanding how the GOP reached its ebb in 2008. Some other highlights and lowlights of the month:

• January 2009 saw Israel at war with Palestinians, which prompted my reflection "Sonny Corleone in Gaza."
• Natalie Dylan offered her virginity online and was offered $3.7 million.
• Of course, January marked the official onset of the Obama Nation, which was inaugurated with puddles of hope. I compared it to the experience of taking my daughter to Bush's 2001 inauguration.
• The biggest problem of the new administration was its economic agenda: Unicorns, rainbows and wasteful neo-Keynesian nonsense.
• I covered the RNC meeting that culminated in the election of Michael Steele as chairman.
• January also brought news of the Hindenburg-at-Lakehurst implosion of Culture 11, a not-unexpected disaster that could be explained in two words: David Kuo. Or perhaps, Conor Friedersdorf.

You see, then, that January was in some ways a precursor of much that was to come in the months ahead.

Obama dozed, Kentucky froze

Forty-two bitter gun-clingers dead, as the hopelessly incompetent brutally ruthless administration gets revenge for Katrina the Democratic primary. Those 42 innocent victims racist hillbillies might still be alive if it hadn't been for the newly-created Department of Unicorns and Rainbows, which halted global warming Jan. 20 by executive fiat.

(Headline joke half-stolen from AOSHQ.)

UPDATE: Actually, my friend Jimmie at Sundries Shack lays claim to coining the "Obama dozed, people froze" headline, subsequently picked up by Ed Driscoll and linked at Instapundit.

So that settles that. Next: Anyone want to dispute my authorial claim to "the newly-created Department of Unicorns and Rainbows"? Slublog or someone else in the Army of Photoshoppers should create a federal logo for this new Cabinet-level agency.

Obama plans mandatory socialized medicine

Ezra Klein of the (liberal) American Prospect:

I've now been able to confirm with multiple senior administration sources that the health care proposal in Obama's budget will have a mandate. Sort of.
Here's how it will work, according to the officials I've spoken to. The budget's health care section is not a detailed plan. Rather, it offers financing -- though not all -- and principles meant to guide the plan that Congress will author. The details will be decided by Congress in consultation with the administration.
One of those details is "universal" health care coverage.

So, despite the economic downturn -- the dire, dire crisis -- Obama supposes that the federal government can pick up the tab for everybody's medical bills. This program will be paid for by the Department of Unicorns and Rainbows.

And by the way, doesn't it make you feel comfortable that the White House is now run by the type of people who have time to return Ezra Klein's phone calls?

Obama's no Daley, but . . .

Michael Barone in the Examiner:

His first political ambition was to be mayor of Chicago, the boss of all he surveyed; he has had to settle for the broader but less complete hegemony of the presidency. . . .
Chicago-style, he has kept the Republicans out of serious policy negotiations . . . Basking in the adulation of nearly the entire press corps, he whines about his coverage on Fox News. Those who stand in the way, like the Chrysler secured creditors, are told that their reputations will be destroyed; those who expose wrongdoing by political allies, like the AmeriCorps inspector general, are fired.

Speaking of Chicago, John Kass of the Chicago Tribune laughs to scorn the shocked! shocked! reaction over Obama's move against inspectors general:

The use of political muscle may be prohibited in the mythic transcendental fairyland where much of the Obama spin originates . . . But our president is from Chicago. . . . David Axelrod and chief of staff Rahm Emanuel come right from Chicago Democratic machine boss Mayor Richard Daley. They don't believe in fairies . . .
It's the Chicago Way. Now, formally, it's also the Chicago on the Potomac Way. . . .

You can read the rest, which is also discussed in today's "300 Words Or Less" editorial at NTCNews.com, and linked at Memeorandum. At this point, IG-Gate raises two basic questions:

1. Does all this suspicious smoke indicate a genuinely scandalous fire? That is to say, is there genuine crime or ethical misconduct involved, or are the inspectors generals just victims of political hardball which, while rudely thuggish in typical Chicago fashion, is not actually criminal?
2. If there is a real scandal, will the Obama-worshipping press ignore it?

After I filed my Friday report at Pajamas Media, I noticed a lot of comments along the lines of, "Oh, Obama will get away with this because the MSM is in the tank." This is a presumption -- indeed, perhaps, two or three presumptions -- too far.

Conservatives can be excused for thinking that rampant Obamaphilia in the press corps will protect The One from any possible consequences for malfeasance or error, if only because this has hitherto been the case. But . . .

Honeymoon kisses ain't news. An FBI investigation of an alleged cover-up is news. The snobs and sycophants in the White House press corps might be predisposed to ignore or dismiss this story but -- believe it or not -- there are still a handful of real old-fashioned reporters in America who get excited at the prospect of scoring an exclusive, and who don't give a damn what the political consequences are.

Not every reporter in America is part of the Washington press elite. But if some reporter at Sacramento Bee aspires to join that elite, what better way than to dig in on this Walpin/St. HOPE/Kevin Johnson/AmeriCorps story and try to turn it into an award-winning investigative series?

It doesn't matter what the political angle is. The hotshot California reporter who scores scoop after scoop on a story of national consquence can build a stack of clippings demonstrating his investigative chops, get some of his stories linked by Drudge and cited by other news organizations and, next thing you know, somebody's paying his round-trip plane fare to Washington or New York to interview for a big new job.

Upward mobility in a declining industry? Kinda cool.

There's another angle to think about, however. Beyond the Walpin/AmeriCorps story, TARP special IG Neil Barofsky has got himself in a tangle with Treasury Secretary Timothy Geithner, and notice who's paying attention to that story. The Obama aura is powerful, but it offers very limited coverage to the ungainly Geithner.

The Geithner/Barofsky feud is going to be covered by lots of New York-based financial reporters who don't give a damn about the Beltway elite. The Wall Street Journal, Investors Business Daily, Bloomberg News -- reporters for outfits like that usually have an indifference to the attitudes of the politics crowd. Indeed, you'll occasionally find a financial reporter who thinks capitalism is OK. Just to cite one example, investigative journalist Matthew Vadum first came to D.C. as a financial reporter.

And there's still the factor of good old-fashioned competition in the press. The editors of the Washington Post aren't going to sit still and twiddle their thumbs if the Examiner, the Politico and the Washington Times start scoring a string of scoops on this story. And the same is true of the TV networks. Check out this Thursday exchange between ABC's Jake Tapper and WH press secretary Robert Gibbs:

TAPPER: Earlier this year the special inspector general for TARP Neil Barofsky tried to get documents relating to AIG. The Treasury Department rebuffed that request, and although ultimately I think they did turn over the documents, the Treasury Department sought a ruling from the Justice Department on just how independent Neil Barofsky's office is supposed to be. Please explain from the administration's perspective what exactly is going on here and why it appears as though the Treasury Department is pushing back against an independent inspector general.
GIBBS: Well, obviously, Jake, the president believes that inspectors general fulfill a unique and important role in ensuring that programs operate with efficiency. No attorney-client privilege on any of this stuff has been invoked. No documents sought have been or are being withheld. The DOJ review is not related to any particular investigation. It is sorting out legal issues relating to the creation of the office.
TAPPER: Right. But could you explain -- could you actually answer my question? I understand the talking points you've been given, but . . .

Read the rest of that, and think of how some other reporters in the White House press corps must have been high-fiving Tapper afterwards. (Honestly, not all of them are completely in the tank with Chris Matthews' leg-thrilling affection for O.)

As with the charmless Geithner, the media's love for Obama won't suffice to protect every member of his administration. Norm Eisen has no unicorns-and-rainbows mystique of Hope, and just wait until the D.C. press corps starts sniffing around the unexpected resignation of the AmTrak inspector general. (Gee, what gaffe-prone politician considers AmTrak his personal pet program?)

The fundamental problem the IG investigation presents to the Obama administration is the contradiction to its oft-declared commitment to transparency, as Jimmie Bise Jr. observes at the American Issues Project:

It could very well be that this small scandal becomes the lead domino that begins a chain reaction that could spell unmitigated disaster for the Obama administration. Regardless, the Inspector General firings and the Treasury Department's unwillingness to cooperate with IG Barofsky are another sign that when they administration claimed to be in favor of greater accountability, it was only blowing smoke.

Despite all the headlines to date, IG-Gate has yet to break through to the status of a major scandal, mostly because the potentially revolutionary developments in Iran have captivated public attention. Yet when the chaos in Iran subsides, the investigations of the IG firings will keep going and, as Jimmie says at Sundries Shack, it looks like this scandal is growing legs. More dominoes may be falling soon . . .

(Thanks to the Blogosphere's Photoshop Queen, Carol at No Sheeples Here, for the artwork.)

UPDATE: Transparency? We don't need no stinkin' transparency!

As a senator, Barack Obama denounced the Bush administration for holding "secret energy meetings" with oil executives at the White House. But last week public-interest groups were dismayed when his own administration rejected a Freedom of Information Act request for Secret Service logs showing the identities of coal executives who had visited the White House to discuss Obama's "clean coal" policies. One reason: the disclosure of such records might impinge on privileged "presidential communications." The refusal, approved by White House counsel Greg Craig's office, is the latest in a series of cases in which Obama officials have opted against public disclosure. . . .
After Obama's much-publicized Jan. 21 "transparency" memo, administration lawyers crafted a key directive implementing the new policy that contained a major loophole, according to FOIA experts. The directive, signed by Attorney General Eric Holder, instructed federal agencies to adopt a "presumption" of disclosure for FOIA requests. . . . But in a little-noticed passage, the Holder memo also said the new standard applies "if practicable" for cases involving "pending litigation." . . .

Read the whole thing. Obviously, Michael Isikoff's legs aren't tingling. BTW, one of the reasons I'm compiling this round-up is for the benefit of another one of my sources, who has a background in federal law enforcement and knows a thing or two about investigations.

UPDATE II: Little Miss Attila:

I think this is very simple: 1) on a national stage, one cannot fire whistle-blowers willy-nilly. Even lefties don’t like that, because everyone understands what that does to the system: when burglars are encouraged to feed poisoned dog food to the Dobermans that guard the shop, Bad Things are likely to happen.

So far, however, it's like looking for investigative reporting in the Jonas Brothers fan-club newsletter.

UPDATE III: Red State's Moe Lane:

I suggest that any journalist reading this and thinking about pursuing it further might want to start by examining this odd story from last year involving a supposedly fake letter coming from Amtrak Superintendent Joe Deely. Not to mention this OSHA release on a whistleblower . . . Not that Weiderhold is directly linked to either case, but these seem to be to be the most controversial cases recently involving internal problems requiring the attention of an Inspector General.

Read the rest.

UPDATE IV: The Washington Times:

On the very same day that the president fired Mr. Walpin, St. Hope's executive director, Rick Maya, left his job at St. Hope. He did not go quietly. His resignation letter charged Mr. Johnson and several St. Hope board members with numerous ethical violations. Most explosively, he charged that a board member improperly deleted e-mails of Mr. Johnson's that already were under a federal subpoena. . . .
On Wednesday, the Sacramento Bee reported that Mr. Maya's allegations have been deemed serious enough that the FBI is investigating potential obstruction of justice at St. Hope. In that light, the firing of Mr. Walpin, who properly blew the whistle on mismanagement and possible corruption, looks ill-considered. . . .

Read the rest. Strange -- the phrase "second-rate burglary" just came to mind, like a 1972 acid flashback . . .

UPDATE V: Ed Driscoll sees Obama doing a reverse-Clausewitz -- politics as warfare -- while Glenn Reynolds inexplicably links the Hartford Courant, but quotes a commentary by Salena Zito of the Pittsburgh Tribune-Review, making excuses for the fan-club-newsletter press corps:

The press could help keep things honest but has fewer resources and readers . . .

Whine, whine, whine. Look, lady: How hard could it be for reporters from the Tribune to ask Arlen Specter or Bart Sestak to comment on the IG firings? Hey, I've got an idea, Ms. Zito: How about you pick up the freaking phone call them for a comment?

Why is it nowadays, whenever editors hire somebody to write op-ed columns, it's never anybody who knows how to pick up a telephone? And then the lazy can't-use-a-phone op-ed idiots wonder why they have fewer readers . . .

UPDATE VI: Pundit & Pundette links with some thoughts on Obama's Chicago Way. Meanwhile, at 1:30 a.m. Monday, I've just made an executive decision to go down to Capitol Hill again today and talk to more sources.

There is no substitute for old-fashioned shoe leather. Just show up unannounced and buttonhole your source. It's an infallible method. Make a nuisance of yourself until they figure out that they need to start calling you, or else you'll be back again bugging them tomorrow.

PREVIOUSLY:

• 6/19: IG investigation: 'Dominoes Fall'
• 6/18: Targeting AIG bailout?
• 6/18: How's the weather in Sacramento?
• 6/18: Sen. Grassley wants more answers

Harsanyi: Not feelin' the Hope yet

Unicorns and rainbows and peace and love don't do much for the Denver Post's David Harsanyi:

Obama challenges Americans to have "a willingness to find meaning in something greater than themselves." So if you find massive concentrated power in Washington a turn-on, you've found your higher purpose. . . .
To require such fealty to power in the name of patriotism was once repugnant to the left. Now, with the right guy in charge, apparently it can once again be embraced.

Dave, man, you need to take inspiration from Kathleen Parker. Puddles of hope!

Another reminder that the MSM is in the tank for Obama, as if you didn't know that

Jeffrey Tucker of the Mises Institute headlined this "All is well because Obama is in charge," which elucidates a point that the New York Times carefully endeavors to obscure:

A study to be released Monday of financial news coverage this year found that government, Wall Street and a small handful of story lines got the bulk of the attention while much less was paid to the economic troubles of ordinary people. . . .
Reviewing almost 10,000 reports from Feb. 1 to Aug. 31 in newspapers, on news Web sites, on the radio and on network broadcast and cable television, Pew found that almost 40 percent of economic news reports dealt with the trials of the banking and auto industries, and the federal stimulus bill passed in February. . . .
Unemployment and the housing crisis accounted for 12 percent. And, the study said, “stories that tried to explicitly examine the broader impact of the economic downturn on the lives of ordinary Americans filled 5 percent of the economic coverage." . . .
In February and March, the economy was the subject of nearly half of all news coverage, driven mostly by the stimulus bill and the uses of bank bailout money. After those fights died down, financial news coverage fell by more than half.
Mark Jurkowitz, associate director of the Pew project, said it was easier for the national news media to cover Washington “than to fan out around the country and measure the impact on real lives.”
“There’s plenty of reason to understand why a lot of this is a Washington and New York story,” he said. “But we’re talking about something that affected almost every American in some way.”

All of which is to say, with unemployment at 9.8 percent and no prospect of it going down in the next six months, the MSM have been ignoring this turd in the punchbowl and pretending that recovery is just around the corner.

What has actually been happening in the economy, of course, is that the way the TARP bailout was structured, it pumped massive liquidity into Wall Street. This inevitably led to a rise in stock prices -- a "sucker's rally" -- that I believe is the main reason we haven't seen a consumer price increase as a result of the Fed's insanely inflationary monetary policy. Relatively little of that extra currency is going to Main Street. Instead, it's been siphoned off into the financial sector and we're seeing an inflationary stock bubble.

Because the MSM desperately wants to believe in the unicorns-and-rainbows magic of Obamanomics, they've highlighted the stock market rally and twisted the headlines about other economic news -- "We only lost 200,000 jobs last month? Great!" -- in an attempt to manufacture consumer confidence.

Alas, consumer confidence isn't magic, either. At some point, the fundmentals actually matter and, as I have occasionally had cause to remind you, the fundamentals still suck.

Auguries of Economic Apocalypse

Last week was an excellent week for gloom and doom, not least because idiots were optimistic, a topic addressed in my latest American Spectator column:

Six months into a stock-market rally, Wall Street apparently saw more good news last week when a Labor Department report showed employment had jumped to 9.7 percent in August. Exactly why Friday's news -- joblessness at a 26-year high -- produced a 97-point gain in the Dow Jones Industrial Average is a good question, but if the stock market were perfectly predictable, we'd all be rich. . . .
First the Bush administration and now the Obama administration have pumped hundreds of billions of borrowed dollars into the system, justifying the stimulus-and-bailout policy as necessary to avert a financial cataclysm. Yet the augurs who study the entrails of the economy are muttering darkly about the inauspicious omens.
Last week, Vice President Joe Biden gave a happy-talk presentation -- "Rainbows! Unicorns! Recovery!" -- about the miraculous effects of the $787 billion stimulus package that President Obama rammed through Congress in February. Once more trotting out the administration's rhetoric about jobs "saved or created" (pick a number, any number), Biden declared, "In 200 days, the president's Recovery and Reinvestment Act isn't just working . . . it's working toward something: It's working toward a more resilient, more transformative economy."
Surely, many economists greeted this declaration with arched eyebrows. What, exactly, is a "transformative economy," and in what sense is it "more resilient"? Never mind. Being liberal means never having to define one's terms.
Biden showed himself adept at the art of ambiguity when he proclaimed to his Brookings Institution audience: "The Recovery Act has played a significant role in changing the trajectory of our economy, in changing the conversation about the economy in this country. Instead of talking about the beginning of a depression, we're talking about the end of a recession eight months after taking office."
Well, who is "we"? It is by no means universally agreed that the U.S. economy is now bound for the sunlit uplands of prosperity, and many of the financial augurs perceive that we may be approaching an economic abyss. . . .

Read the whole gloomy thing. And expect further omens of catastrophic Obamanomics at NTCNews.com. The revolution will not be televised, but the apocalypse will be blogged.

UPDATE: Doug Ross anticipates Zimbabwe USA.

UPDATE II: Taxpayers get screwed:

The federal government is unlikely to recoup all of the billions of dollars that it has invested in General Motors and Chrysler, according to a new congressional oversight report assessing the automakers' rescue.
The report said that a $5.4 billion portion of the $10.5 billion owed by Chrysler is "highly unlikely" to be repaid, while full recovery of the $50 billion sunk into GM would require the company's stock to reach unprecedented heights.
"Although taxpayers may recover some portion of their investment in Chrysler and GM, it is unlikely they will recover the entire amount," according to the report . . .

In other words, the auto bailout was a taxpayer-funded swindle, cheating the legitimate stakeholders on behalf of the UAW bosses. Oh, and here's some more cheerful news: Inflation's back!

UPDATE III: Read Max Baucus's lips: More New Taxes!

What the Baucus proposal means in real terms is that a family of four with a household income above $66,150 would face a tax of $3,800 if they do not obtain health care, while an individual with income above $32,490 would face a tax of $950.

Meanwhile, Cato's Andrew J. Coulson explains how Obama's stimulus spending on public schools is actually hurting the economy. Man, this is turning out to be a great day for gloom and doom!

'It is easy to mock . . .'

". . . white-supremacist views as pathetic and to assume that nativism in the age of Obama is on the way out. But racism has a nasty habit of never going away, no matter how much we may want it to, and thus the perpetual need for vigilance. And it takes only a cursory look at a worsening economic climate and grim national mood to realize that history is always threatening to repeat itself."
-- New York Times editorial

What the Times is huffing about is a press conference with Bay Buchanan, Jim Pinkerton, Peter Brimelow and Marcus Epstein which I covered last week. The report prepared by Epstein is available online, and any reader can assess the extent to which the slurs "white supremacist," "nativism" and "racism" are applicable. (I only skimmed the report, but it certainly didn't look like something Willis Carto or J.B. Stoner would publish.) The Times is to be congratulated for their effort, which I'm told got Bay Buchanan booked tonight on "The O'Reilly Factor."

Based on a superficial familiarity with the Epstein report, and with the discussion at the (lightly attended) press conference, I am left to wonder if there is any person, organization, publication or event aimed at discussing immigration as policy and politics from a border-enforcement perspective, that would not be denounced by the Times. in more or less the same manner as they've denounced Buchanan, et al.

Ah, but it seems like only yesterday that "dissent" was patriotic and we could not criticize Code Pink, CAIR, Ward Churchill, Cindy Sheehan or International ANSWER without being accused of totalitarian impulses. Some animals are more equal than others.

Perhaps we'll soon have a directive telling us exactly which forms of dissent, and on which issues, are still considered patriotic. Obama should order Secretary Dodd and the Department of Unicorns and Rainbows to look into this.

UPDATE: Behold, the face of white supremacy! (What would Lothrop Stoddard say?)

Doom and gloom alert

UPDATED & BUMPED 10:20 p.m.: There is sort of a false-dilemma fallacy that's mucking up arguments about government economic policy lately, and I'll tee it up by quoting something that Matt Cooper Twittered tonight:

Strong opening statement explaining the problem and why stimulus will help. Best line: "Tax cuts alone can't solve our economic problems."

Allow me to go long here a bit, because this is important. We just had a once-in-a-lifetime wipeout in the financial markets. If you talk to smart economists, off the record, you understand that the bursting of the real-estate bubble was not just a normal hump in the business cycle. It was more like the Mother Of All Corrections, a Drudge-siren alert that the fundamentals of our economy had gotten waaaay out of whack.

When the Good Times go away, there's no guarantee they'll ever come back. And if you've been reading Megan McArdle over the past year or so, you know that she has advanced the notion that top marginal rates are now sufficiently low that major Laffer Curve effects are not to be expected from further reductions. (Not sure I'm buying that argument, but it is worth considering.) So the question is not necessarily whether the Right is correct in saying that tax cuts will fix the economy or the Left is correct in saying that deficit spending will fix the economy. Rather, the question is, Can the economy be "fixed" at all?

That is to say, given all the economic realities -- including the graying of the workforce and the ballooning entitlement burden -- is there any government intervention that will automatically return us to the Good Times? I'm not entirely sure. There are textile-mill towns down home where the Good Times left and never came back. There are little towns all over rural America that have been shrinking toward ghost-town status for the past 15 or 20 years. Inner-city Detroit has never really recovered from the 1967 riots.

That a nation as large and wealthy as the United States might go down, never to rise again, is a remote possibility, but there is no guarantee we'll ever get back to the go-go heyday of 1987, when the Baby Boomers were age 23-41 and thus in their healthy prime working years. We have suffered a serious financial loss and, because of underlying structural problems in our economy, recovery will be difficult whatever the government does. But if government does the wrong thing, it's going to be much more difficult.

All this is to explain why we should be extremely pessimistic about the prospect of this massive neo-Keynesian intervention. Suppose a pipe-dream hypothetical: Somehow, this "stimulus" actually produces a sort of dead-cat bounce in the economy, so that unemployment is down around 5% again by 2012. Is that good? No, not really, because government will have produced that bounce by borrowing massively against the future in a society that's about to sustain a serious demographic shock.

The first Baby Boomers turn 65 in 2011, and every year after that will see more and more retirees going onto the Social Security and Medicare rolls. Even if we raise the retirement age, there is still the net drain of productive labor. The average 67-year-old can't produce goods and services as efficiently as the average 38-year-old and (due to certain legal decisions circa 1973) after 2011, we'll have a growing shortage of 38-year-olds and a growing surplus of 67-year-olds.

We are on the verge of a taxpayer shortage, you see, and what the Democrats want to do is take out a massive loan that will have to be repaid by a shrinking pool of taxpayers, who will be expected to support a burgeoning population of increasingly sickly Baby Boomer retirees.

So, even if all this deficit spending could purchase a dead-cat bounce -- and I am on record as saying it won't -- it cannot fix the underlying problems of our economy, which have nothing to do with "green energy" or other such nonsense programs run by the Department of Unicorns and Rainbows.

What we need, really, is a strong dose of Schumpeterian "creative destruction," and this neo-Keynesian approach is the exact opposite of that. No matter what government does, we may be doomed. But Obamanomics is like seeing a drowning man and tossing him a cinderblock instead of a life preserver.

Total bummer? Depends on your point of view. Back in 2003-06, when the economy was going gangbusters, you leftist bastards were all whining about "the growing gap between rich and poor." Well, congratulations: It's stopped growing, hasn't it?

If Obamanomics makes things worse (hello, "stagflation"!) then the advocates of social justice can do a happy dance because we'll all be more equal, and much, much poorer.

(Linked by Jules Crittenden, who gets the Instalanche for his Iran-blogging.)

(Linked by the Anchoress, who gives me waaaay too much credit for what was really just second-hand copyright infringement.)

(Ed Driscoll gives the linky-love, too.)

(Linked at Conservative Grapevine.)

(Linked at Maggie's Farm. BTW, I've updated this theme, with cute video.)

PREVIOUSLY: Malkin watches the Doomsayer-in-Chief's press conference so we don't have to:

"It is only government that can break the vicious cycle."

Government is the vicious cycle, sir.

UPDATE 9:21 p.m.: Back to his bogus "experts agree" argument:

Sir, experts agree your ears are too big.

UPDATE 8:55 p.m.: From his opening remarks:

I took a trip to Elkhart, Indiana today. Elkhart is a place that has lost jobs faster than anywhere else in America. In one year, the unemployment rate went from 4.7% to 15.3%. Companies that have sustained this community for years are shedding jobs at an alarming speed, and the people who’ve lost them have no idea what to do or who to turn to. They can’t pay their bills and they’ve stopped spending money. And because they’ve stopped spending money, more businesses have been forced to lay off more workers. Local TV stations have started running public service announcements that tell people where to find food banks, even as the food banks don’t have enough to meet the demand.

Folks, ask yourself why Elkhart's economy is hurting so bad. Because their No. 1 industry there is -- wait for it -- RVs. Yup, big-ass fuel-guzzling RVs that get worse gas mileage than an M1 tank. If it were up to Al Gore, driving one of those things would be punishable by the death penalty, and when gas went up to $4 a gallon, the market wasn't exactly craving those behemoths. But by the time gas prices fell back to $1.69 a gallon, the real-estate market had tanked, and nobody had the the money to buy a $70,000 motor home.

Supply. Demand. Very simple. Nothing against the good people of Elkhart, but (a) Obama's plan ain't going to do jack for your local economy, and (b) if you end up on the wrong side of the supply/demand equation, that's not the fault of the American taxpayer, is it? Cry me a river. I spent 22 years in the newspaper business, and nobody's offering to bail me out.

UPDATE: Althouse liveblogged. Loved this part:

7:14: "That wasn't just some random number that I plucked out of.... uh" -- he's thinking: can't say my ass — "out of a hat."

Allahpundit and AOSHQ are also blogging the press conference.

Michelle Malkin was liveblogging the action on the Senate floor today:

[Sen. Susan] Collins laundry-lists all the spending and concludes again: "Our effort is bipartisan, targeted, and effective."
No: It's pork-laden, out-of-control, and irresponsible.

Susan Collins (R-INO) would swallow a porcupine if you told her it was a "bipartisan compromise." Obama is scheduled to give a nationally televised press conference tonight at 8 p.m. ET, at which time he will tell us that we are doomed -- DOOMED! -- if this thing isn't passed immediately.

Liberal economics, by Amy

An oxymoron? No, just a moron:

I'm actually starting to get offended by the rhetoric about how we need private-sector, not public-sector, jobs from whatever stimulus plan we hatch.
First of all, jobs are jobs and we need them, so let's get them all "stimulated" and into action. But secondly, can I just say that the only people I know who are secure in their jobs are people with government jobs? My friends, family, and students working for private companies or for themselves are getting hosed. Those of us working for the county, state, and country are relatively secure.
So why would private sector jobs be, in these uncertain times, preferable to public sector ones?

It's like an Onion parody or something Iowahawk might write, but Amy is apparently sincere. Obviously, she should get a job with the Department of Unicorns and Rainbows.

(Tip from Donald Douglas.)

The worst is yet to come

First, the not-entirely-pessimistic news from the chairwoman of the FDIC, Sheila Bair:

"There are still some troubled assets on the books and we still have an economy that's under significant stress," said Bair in a 90-minute interview with Forbes reporters and editors on Friday.
"We still don't know how deep the recession is going to be," she said . . .
Bair reminded, 21 insured institutions failed in the first three months of 2009, the most bank failures since 1992. The FDIC's list of problem banks grew to 305 from 252. Those 305 banks at risk of failure have some $220 billion in assets. . . .
"Hopefully there are no more events that create liquidity stresses on the banks," Bair said, knocking on a wooden conference room table, "and now we're having more good old-fashioned capital insolvencies."

I would submit that when the FDIC chair is in a knock-on-wood situation vis-a-vis a collapse of the banking industry, things are probably much worse than we imagine. And now for the truly scary stuff:

A housing rebound is a virtual impossibility. Homeowners currently have the least amount of equity in their homes on record. Overall, the number of borrowers underwater climbed to 20.4 million at the end of the first quarter, up from 16.3 million at the end of the fourth quarter. . . .
There are 75 million homes in the United States. One-third of homeowners have no mortgage, so that means that 41% of all homeowners with a mortgage are underwater. With prices destined for another 10% to 20% drop, the number of underwater borrowers will reach 25 million.
There are over 4 million homes for sale in the US today. This is about one year’s worth of inventory at current sales levels. You can be sure that another one million people would love to sell their homes, but have yet to put them on the market. And there’s a tsunami of Alt-A mortgage resets now approaching our shores. That will get under way in 2010, and won’t peak until 2013. These Alt-A mortgages are already defaulting at a 20% rate today. There are $2.4 trillion Alt-A loans outstanding. . . .
With the 30-year mortgage rate approaching 5.7%, mortgage refinancing activity has plunged about 60% in the last 2 months. Mortgage applications for new home purchases collapsed at a 20% annual rate in May, too. Normality in the mortgage market appears to be years away.

There's much more where that came from. Frightening. Both of those items via The Johnsville News. And now, via Instapundit, we find Megan McArdle confronted by unrealistic expectations in DC real estate., where a $4,000 reduction to $495,000 is a "NEW LOW PRICE" on a 1,000-square-foot townhouse that sold for $460,000 four years ago.

This is perhaps the most frightening news of all, that so many people still haven't adjusted their expectations to economic reality. Maybe they're under the influence of Kudlowism or, more likely, they're liberals who think that the Department of Unicorns and Rainbows has already fixed the economy.

People who haven't actually tried to sell their homes, and who haven't paid attention to the real-estate market, seem to imagine that the crash that hit last September was just a blip signaling a short-term recession and now we're in blue-sky territory. When the sheriff's auction becomes the primary venue for home sales, maybe people will start paying attention.

Why CNN sucks

Greetings from the Buffalo Niagra International Airport. Just put Ali Akbar on his plane back home and, with deadline looming for the December issue of The American Spectator -- subscribe now -- the National Desk has been set up at the airport bar for a few hours.

I'm being forced to watch CNN, where the host of "American Morning" just finished interrogating (not interviewing) Rep. Michelle Bachmann. CNN's John Roberts did his assigned job, reading from DNC talking points and forcing Bachmann to respond point-by-point to the liberal argument -- which, however, was not presented as a liberal argument, but rather as "some critics say" or, simply, as facts.

At one point, Roberts raked Bachmann over the coals for calling ObamaCare "socialized medicine." That is to say, he was spinning for the Democrats, who know that "socialized medicine" has negative connotations compared to "health care reform."

This rhetorical battle is, however, only about politics, and has nothing to do with the policy at dispute. In terms of policy -- what will it cost taxpayers? how will it affect delivery of health care services? et cetera -- it doesn't matter if you call it Super Duper Rainbows And Unicorns Sexy Delicious Health Care Paradise. The policy is the policy is the policy.

John Roberts made no acknowledgment of this underlying reality. His job was to pretend to be objective while striving to depict Bachman and all other opponents of ObamaCare as extremist fringe kooks: "Socialized medicine! How dare you call it socialized medicine!" And he did that dishonest work with transparent enthusiasm.

This segment was followed, a few minutes later, by a puff-piece profile of Valerie Jarrett, who was given the kind of tough, aggressive, critical treatment that the Jonas Brothers get from the editors of Tiger Beat.

It is CNN's pseudo-objectivity -- a liberal perspective presented as The Way It Is -- that annoys the informed viewer.

The White House has waged a propaganda campaign against Fox News (which frankly presents a conservative perspective as The Way It Is) while Fox's two cable rivals (both liberal) slide into Nielsen irrelevance, unable to attract a mass audience. And the geniuses at CNN can't seem to figure out why this is.

On the radio with G. Gordon Liddy

At 10:30 a.m. today, I'll be on the air with G. Gordon Liddy. (Listen live here.) We'll be discussing Obamanomics, including ACORN's civil disobedience protests to prevent mortgage foreclosures -- which I've argued should be expanded to preserve my right to a 2004 KIA Optima. We might also talk about Obama's new federal Department of Unicorns and Rainbows.

Some of you may know that the left-wing group Media Matters has recently honored the G-Man with a vicious smear -- or, as Liddy's producer calls it, "free advertising."

If you're a Liddy listener visiting The Other McCain for the first time, please look around and be sure to check out "How to Get a Million Hits on Your Blog." We've recently had a burst of Rule 5 blogging.

White House Update

WASHINGTON, D.C. -- President Obama yesterday announced that the interrogation and permanent detention of suspected terrorists at Guantanamo Bay, Cuba, is "totally copacetic" with the Geneva Conventions.

"This is a remarkable achievement," the president told a press conference Friday. "A mere four weeks ago, Guantanamo Bay was a human-rights catastrophe such as the modern world had never seen. Yet today, through the power of Hope, we have succeeded in making this facility a shining examplar of freedom, a beacon of Change admired throughout the world."

The amazing transformation, Obama told reporters, would not have been possible without the "tireless labors" of the staff of the newly-created federal Department of Unicorns and Rainbows. . . .

CONTINUED ON PAGE 14A

The Doomsayer-in-Chief

Barack Obama, bidding fair to become the 21st century's Jimmy Carter, lays a heavy downer on us via the the Washington Post op-ed page:

By now, it's clear to everyone that we have inherited an economic crisis as deep and dire as any since the days of the Great Depression.

(Via Memeorandum.) Read the rest of it if you want, but the key word is "inherited": Blame Republicans First!

Amazing that our new president can find time in his busy schedule to pen a 767-word op-ed column. What further wonders can we expect from the creator of the Department of Unicorns and Rainbows?

UPDATE: "So much for 'rejecting the politics of fear' "

UPDATE II: Michael Goldfarb on "The Audacity of Panic."

2009 Year in Review: February

The endless bummers of January continued into February, which meant that something had to be done to lighten the gloom. Ergo, a very special Cabinet post for Chris Dodd:

As Secretary of the Department of Unicorns and Rainbows, Dodd will face "daunting challenges in this time of crisis," the president said, referring to the distinguished silver-haired senator as "one of our nation's most visionary leaders."

Other insightful political commentary from February:

• "There is a marked tendency for heterosexual men to be interested in women."
• The low ebb for Republicans came when the House GOP could muster only 135 votes against the S-CHIP expansion.
• February was the month of stimulus: 1,434 pages, $789 billion and not a red cent for me.
• Exactly what did Obamanomics mean? Reinflating the bubble and the Fiscal Trap of Hope.
• MEGA-BLOGGER: "How to Get a Million Hits."
• Ace of Spades: Hanging with Hitch in Beirut.
• The first-ever Rule 5 Sunday.
• CPAC! CPAC! CPAC!

February also saw the beginning of the Tea Party movement, which sparked the beginning of a long-running argument with Rick Moran:

Rick doesn't seem to believe that opposition to Obamanomics could ever become a decisive groundswell. And he is entitled to that opinion. But to say that such opposition is not now a groundswell does not mean it will never become one.

Wow, did I call that one, or what? I followed up with a long post entitled "Tea Parties, Defeatism and Wolverines" -- the first of what became an informal series with a populist theme -- and quoted Jennifer Rubin: "The opposition party must oppose."

Obama names new Cabinet post

WASHINGTON, D.C. -- President Barack Obama yesterday announced that he would ask Congress to create a new federal department to help implement key elements of his ambitious agenda.

"Too long, the dreams of Americans have been denied, too long our nation's promises have gone unfulfilled," the president said during a White House news conference, in a nationally-televised speech that left several reporters wiping away tears at the unprecendented historic signficance of the moment. "No longer will we watch our children grow cynical with disappointment, nor see our senior citizens despairing of hope."

Flanked by congressional leaders -- including Sen. Edward M. Kennedy (D-Mass.), who was visibly moved with emotion -- the tall young president gestured dramatically as he declared: "America will wait no more. We must act now. For we the people, are the people, whose time, at last, has come."

After a standing ovation from the assembled journalists, President Obama went on to say that congressional leaders had agreed to "initiate an expedited agenda" in order to approve by next Tueday emergency legislation creating and funding the new department, its fiscal-year 2010 budget projected at "eleventy kazillion dollars," according to a senior administration official who spoke at a subsequent briefing.

Describing the new department's mission as "pursuing world peace . . . ensuring social justice and . . .restoring America's image abroad, an image tarnished by eight dark years of neglect," the president named veteran Connecticut statesman Sen. Christopher Dodd as secretary-designate with Cabinet rank.

As Secretary of the Department of Unicorns and Rainbows, Dodd will face "daunting challenges in this time of crisis," the president said, referring to the distinguished silver-haired senator as "one of our nation's most visionary leaders." . . .

CONTINUED ON PAGE A14

(LOGO DESIGN BY AARON S.)

'God Help Us'

So says Blue Crab Boulevard, surveying the catastrophic effects of Obamanomics. And that was before he learned of The Mother Of All Bailouts.

The O'Biden Happy Talk about the magical wonders of "stimulus" continues to deceive much of the MSM -- it's all unicorns and rainbows and "recovery," as far as they know -- but the financial press can't ignore the evidence of impending crisis.

One thing NTCNews.com has focused on is aggregating financial and economic news, which has required me to scour over Google Business News and other sources. Is the DJIA up or down? What about Treasury notes? Gold? Oil? Currencies? Banking? Housing? Employment?

Thursday, the stock market broke a 4-day slide, and gained again on Friday, after the much-anticipated August jobs report showed unemployment had risen to 9.7%. The average person sees these two facts -- jobs down, market up -- and asks, "How on earth is 9.7% unemployment good news?"

Beats me. If I could figure out the stock market, I'd be rich. Instead, I'm a blogger. However, facts are facts. Since peaking at 14,034.39 on Oct. 9, 2007, the DJIA has lost 4,593.12 points. Even though the Dow has bounced up some 3,000 points since bottoming out in March, we're still talking about a net loss of 32.7% in less than two years.

Combine that with the meltdown in housing prices, and it represents a massive devastation of asset-value, an economic cataclysm of historic proportions.

Now, consider that we are less than two years away from 2001, when the oldest of the Baby Boomers, born in early 1946, turn 65. Their retirement funds have been diminished by the stock-market collapse, and if they had planned to cash out the equity in their homes . . . Well, good luck with that plan.

Beginning in 2011, then, an increasing number of Baby Boomers will undergo the transition from taxpayers to tax consumers, eligible for Social Security and MediCare, a fiscal drain on the economy. Only by dipping into what remains of their asset value -- selling their homes or other valuables, spending out their IRAs, 401(k)s and other retirement funds -- will this exploding population of retirees be able to live above the minimum level provided by the government.

Without getting into a lot of complicated analysis (e.g., the growth-killing impact of just about anything the federal government might do to meet the looming fiscal crisis), the ordinary person with a minimal level of economic education who looks at this situation can only conclude: We're completely screwed.

Which is why, as I scour the financial news, I keep an eye out for omens and portents of the inevitable apocalypse, such as these items aggregated at NTCNews.com the past week:

Are We Facing a Banking Crisis? Is the Gold Price About to Explode?
-- Market Oracle, Aug. 31

"Oil prices fell to near $71 a barrel Monday as China's stock market tumbled and commodities investors questioned whether the U.S. economy can recover strongly in the second half."
-- Associated Press, Aug. 31

"AIG fell 17% after Sanford C. Bernstein dropped the stock to 'underperform,' on concerns that Washington will pull back on financial assistance as AIG recovers. The firm is still on the hook for $80 billion in federal loans . . ."
-- Forbes, Sept. 1

"The American economy will suffer 'a long time' as a result of last year's federal bailout of the financial industry, according to Johan Norberg, author of a new book about the policies that caused the banking meltdown. . . . 'The bailouts . . . the debts -- we won't be able to pay them back. We're going to pay for it for a long time . . .' "
-- The American Spectator, Sept. 2

"FDIC head Sheila Bair told CNBC Tuesday evening that commercial real estate loans remain a "looming problem" for banks' balance sheets and she expects the area to increasingly be a driver for bank failures during the remainder of this year and 2010 . . ."
-- Reuters, Sept. 2

"U.S. banks are holding more than $1 trillion of mortgages backed by commercial property that is fast losing value."
-- Wall Street Journal, Sept. 2

" 'Most participants saw the economy as likely to recover only slowly during the second half of this year, and all saw it as still vulnerable to adverse shocks,' the Fed said in today’s minutes. 'Labor market conditions remained of particular concern to meeting participants . . .' "
-- Bloomberg News, Sept. 2

"Gold prices reached their highest point in nearly three months as the U.S. dollar weakened and participants bought in a flight-to-quality bid based on economic uncertainty and concerns about the stock market . . ."
-- Wall Street Journal, Sept. 2

"Treasurys fell Thursday, sending yields higher, as stocks edged up and the U.S. government said it planned to sell $70 billion in Treasury bonds and notes next week."
-- MarketWatch, Sept. 3

UNEMPLOYMENT REACHES 9.7%
-- NTCNews.com, Sept. 4

"Tony Crescenzi, a market strategist and portfolio manager at Pacific Investment Management Co., manager of the world’s biggest bond fund, said the U.S. faces a slow recovery because unemployment is persisting . . . 'The key ingredient for a sustainable recovery is still absent,' Crescenzi said today in an interview on Bloomberg Radio. 'We need income growth to produce self-reinforcing expansion. . . . The duration of unemployment will be longer and will put downward pressure on wages.'"
-- Bloomberg News, Sept. 4

"Congress passed the Cash for Clunkers program in order to increase automobile employment and save jobs. . . . The employment report shows that -- despite the Cash for Clunkers craze, and the $2 billion Congress added to the program at the end of July -- motor vehicles and parts manufactures shed 15,000 jobs in August. That erased half of the jobs gained in July and continued the yearlong downward trend . . ."
-- Heritage Foundation, Sept. 4

FEDS SHUT DOWN 5 BANKS
-- NTCNews.com, Sept. 5

Given the serious underlying problems of the economy -- "The Fundamentals Still Suck," as I explained in May -- no amount of unicorns-and-rainbows "recovery" talk from the administration and its MSM sock-puppets can avert the inevitable consequences.

So NTCNews.com keeps an eye on the economy and readers who appreciate this service -- you can subscribe to the RSS feed in Google, Atom, etc., to get the latest updates -- are invited to support this project by hitting the tip jar.

"The revolution will not be televised, but the apocalypse will be blogged."

Economics: 'The Current Weirdness'

In a private e-mail exchange, one very shrewd financial analyst used the phrase "the current weirdness" to describe the economic moment we're in. "[T]he overall story in the media is wrong, which isn't unusual," said my correspondent. The problem is that our situation is so unprecedented, even the most astute observers are somewhat mystified.

What provoked the "current weirdness" remark was something I wrote about the possible influence of hidden inflation in the financial markets:

This chart, from CNN/Money, shows how crude oil prices have increased 49% since March. Interestingly enough, rising petroleum prices mirror a rise in the stock market during roughly the same period. The Dow Jones Industrial Average, which closed at 6,547.05 on March 9, closed Monday at 8,764.49 -- a 34% increase.
If analysts worry that rising oil prices could jeopardize recovery, why would this spike in petroleum coincide with a rising stock market? One possibility: Inflation. . . .
The Dow gains of the past three months may also be a product of inflationary pressures -- the price of stocks going up because the dollar is worth less. And maybe this explains those uncountable jobs "saved or created" while unemployment keeps going up.
Treasury Secretary Timothy Geithner says "the global storm is receding." Expect a new storm if investors become convinced that inflation is fueling a Ponzi recovery.

Please read the whole thing. If even shrewd analysts are puzzled by "the current weirdness," the rest of us need to be paying attention.

(Cross-posted at Right Wing News.)

UPDATE: When Von at Obsidian Wings talks about Obama's deficits, note the reaction:

Other commentators argue directly or indirectly that Obama's deficits don't matter because Bush also ran deficits (albeit smaller ones). That's illogical: two wrongs don't make a right; if anything, Bush's irresponsibility counsels for greater -- not less -- responsibility on the part of Obama. Attacks on me as a purported Bush supporter also don't change the facts . . . They additionally overlook the fact that I never voted for Bush.

Allowing political beliefs to cloud your vision of economic reality is a major problem. Given my oft-stated belief that Obamanomics is doomed to failure -- It Won't Work, The Fundamentals Still Suck, Economics Is Not a Popularity Contest and we're on The Road to Weimar America -- I'm obviously inclined to believe that the light at the end of the tunnel is an oncoming train.

Nevertheless, while diligently auguring for auspices of doom in the economic entrails, I'm trying to check my pessimistic biases at the door and entertain the possibility -- however remote -- that the inherent dynamism of the American economy can overcome even the Keynes-on-steroids interventionist approach of Obama, Pelosi and Reid. We may yet muddle through somehow.

Conversely, idolators in the Obama temple cult viciously denounce heretics like Von. To disbelieve in the miraculous power of Hope, to doubt the unicorns-and-rainbows promises of painless Change, is to invite banishment to Outer Darkness. We recall the fate of Soviet scientists who questioned Lysenkoism in the Stalin era.

If faith in The One requires the faithful to ignore all dispositive evidence, what is the likelihood that the faithful are right and the heretics are wrong?