Archive for October, 2008

Can Obama Close the Deal?

Republicans expecting a McCain comeback in the last two weeks of the campaign point out that Obama has had trouble in the past ‘closing the deal,’ or convincing the American people to truly embrace him and his policies.  To be sure, Obama’s inability to close the deal is overstated.  He failed to KO Hillary because he held back his punches.  He knew he’d need her and her supporters, and in a very emotional campaign he could not afford to be negative or go after her with ferocity.   Obama is, however vulnerable.  Yet he has the resources to turn that vulnerability into a strength and close the deal effectively.  If he can pull it off, he can win big.

Ronald W. Reagan in 1980 was considered a risky choice for President.  He was a former actor, and though Governor of California, was inexperienced and seemed far too right wing.  People thought of him as scripted and not very intelligent.   In an era when being “conservative” was seen as something negative, Jimmy Carter rationally thought that he could ultimately convince the American public not to take a chance on Reagan.  Carter held a late lead before being trounced by the California conservative.   Reagan picked up nearly ten points in the last week of the campaign.  The reason is clear:  in a debate just days before the election Reagan appeared calm, collected and competent.  He outperformed Carter on just about every level, making the public believe he was indeed Presidential, and not a risk.  He showed Carter to be risky, pointing at the foreign policy and economic difficulties the US was enduring.   Voters broke to Reagan in a big way.

In 2000 George W. Bush held a rather large lead late in the campaign, but like Obama’s now, his lead was soft.  Al Gore had experience, and was coming from an Administration that could boast impressive economic success.  Yet George W. Bush seemed charming and offered to be a unifier in a country that had been divided by scandal and intense partisan politics.    He seemed set to win easily.  Instead, he lost the popular vote, and was lucky to have Florida ultimately on his side, giving him the Presidency.  Simply, the late breakers decided that maybe Bush wasn’t quite ready, and Gore would be less risky.  Ominously for Obama, Gore wiped out a six point lead in the last two weeks of the campaign, showing that Obama’s lead is clearly not insurmountable.

The McCain campaign knows that this is Obama’s weakness.  Sure, they can call him “socialist,” or bring up Ayres and Rev. Wright to try to do this.  Many in the Republican “base” are certain this will work because it resonates so well with them.  However, such a strategy would fail.  Calling a candidate “socialist” seems a bit banal, and since the Ayres and Wright stuff haven’t stuck before, why would they stick now, especially with Obama outspending McCain in advertising by a 4 to 1 margin.   It’s too late to define Obama, that could only be done effectively much earlier in the campaign.  McCain needs instead to take a lesson from Hillary Clinton, and emphasize experience to convince people that while Obama may be an inspiring man, he is just not quite ready for the big job.

How should Obama prepare for this?   A hint may have come from Joe Biden today, who stated up front that Obama would be tested early in his Presidency, and talked about the kind of challenges the new President would face.   Some in the GOP thought this was Biden going off message — shouldn’t the Obama camp avoid questions of who best can handle a crisis?

Not necessarily.

McCain has committed some serious gaffes this year.  He suspended his campaign, vowing not to debate until the financial bailout package was passed.  He changed his mind.   While it may have been something he had to do — missing the debate would have hurt him immensely — by creating a sense of crisis and stating on principle he would suspend his campaign and not debate, his change of heart made it seem like he was erratic.

Then there is Palin.  Here the McCain campaign is vulnerable on two fronts.  First, McCain’s choice of Palin is increasingly seen as a risky gamble, especially given the problems she’s had with the big stage.  Couldn’t there have been a better choice to motivate the base?  Second, McCain is old, and Palin could become President.   She is widely seen as not ready for the job.

There is also Colin Powell, who called McCain “unsure” and essentially said that Obama would be the best to handle a crisis.

Finally, there is Obama himself.  He’s cultivated an image of being cool and collected while McCain is passionate and firey.  He’s appeared more Presidential in the debates, avoiding looking silly in split screen debate shots.  McCain’s awkward grimaces and apparent anger hurt him in the final debate.

So here’s a potential campaign ad for Obama:  Start with Powell’s quotes and the quotes of other generals supporting Obama over images of Obama in “Presidential moments.”  Then shift to McCain, maybe a split screen shot or some other embarrassing pose.  The voice would say: “John McCain thought the financial crisis so important that he suspended his campaign and vowed not to debate until the crisis was solved.  He changed his mind.   He suspended his campaign before he decided not to suspend it.”  Put in some quotes from others criticizing McCain for being erratic or a gambler.  Then, as a series of shots of qualified, respectable Republican Vice Presidential possibilities are shown, including many women “Of all the people with experience in the Republican party, John McCain chose Sarah Palin (show a shot of her in an unflattering position) to be the Vice President.  This was his first Presidential decision.  (Show shot of McCain looking old/weak).  While we wish Senator McCain a long life, there is a real chance that his age and health difficultiess could put the Vice President into a position of having to make Presidential decisions in a time of crisis (show a shot of Palin talking to Katie Couric).  Did he make a good choice in Governor Palin, or was he gambling, not thinking through his options?   The stakes are high this election.  The country cannot afford the risk of a McCain Presidency.”  End with image of a Presidential looking Barack Obama.  “I’m Barack Obama, and I approved this ad.”

Jeff Greenfield once argued that the best candidates turn their greatest vulnerability into an asset.  McCain’s poor campaign has given Obama the ammo with which to do it.  He also has the money to get the message out, and while this sounds cynical, I bet he can sell the message simply with powerful ads.  If he does this very late in the campaign, McCain may not have time to reply.

Obama’s get out the vote effort will probably be enough for him to hold on to his lead, even if the race tightens as many predict.  However, if he can truly close the deal, it could be a landslide.  To do so he has to not only avoid having people think he’s risky, he has to create a conventional wisdom that he is the safe choice, and John McCain the risk.  If he can pull that off, he’ll win big.

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1929 and 2008

As the election nears I’m sure my blog entries will focus on the politics of the McCain-Obama race quite a bit in the next two weeks. But today I want to reflect on the issue that will be with us no matter who wins: the financial crisis and the possibility of a deep recession, or even a depression.

I recently re-read the book The Great Crash of 1929, a 1954 classic by John Kenneth Galbraith. The book is very readable, and describes the crash and its aftermath in dramatic detail, making personalities come alive, and describing the culture and mood of the country well. While that crisis was in many ways quite different than the one we face now, there are numerous similarities. The most obvious one is how oblivious so many people were to the clear imbalances in the economy, and the irrationality of the speculative bubble. In 1929 only the New York Times consistently kept up the drumbeat of expecting a crash and reporting that stock market bubble was unsustainable. Other Cassandras became weighted down by being wrong so often when the stock market and the economy kept growing that they embraced the conventional wisdom: the economy was strong,  this was a new era, and the naysayers were just “gloom and doom” pessimists who didn’t understand how markets work. The big shots – the movers, shakers and pundits – gave every reason to believe that things were good and would only get better.

That has been the case this time too. The pundits, economic leaders, and main investment banks were convinced, and convinced average folk, that this was prosperity to last. No recession on the horizon (or perhaps just a small one) and we’re in a new era. While The Economists and a few Cassandras remained unconvinced, they were on the margins, ridiculed especially by the conservative pundits who accused the cynics of “talking down” the economy.

However, the book really strikes paydirt when it lists the five reasons Galbraith finds for why the Great Depression occurred after the stockmarket crash:

1. A bad distribution of income, with too much wealth concentrated in the extremely rich. 2008: Arguably the situation in 2008 is worse than it was in the late 20s. While we lack the breadth of the underclass of the pre-New Deal era, the concentration of wealth has been consistently becoming more warped from about 1980 on. The Clinton years were as bad as the Bush years in that regard, it was a bi-partisan maldistribution of wealth. That creates imbalances throughout the economy which can make a real depression likely. It is, bottom line, necessary to spread the wealth better.  That isn’t socialism, that’s recognizing that a warped distribution of wealth leads to economic crisis.

2. The bad corporate structure. The similarities between 1929 and 2008 are immense here. High CEO salaries and corporate inside deals have dominated, especially as it appears economic growth was endless and the corporate leaders could do no wrong. Whether it’s health insurance companies putting profits ahead of health care, Enron like debacles, or just the general mismanagement now coming to light as corporate structures are put under extreme stress, it’s clear that corporations were accountable to no one, and had (no doubt still have) embedded corruption.

3. The bad banking structure. Well, this is obvious, given the scope of the credit crisis, the mortgage backed securities, and the way that intra-bank lending dried up in light of the current crisis. A banking structure built on a sound foundation doesn’t require a bailout of about $1 trillion.  Simply, it was, as in 1929, predicated on a belief the economy would continue to grow and people would continue to borrow at the same rates.  That was never a realistic assumption.

4. The dubious state of the foreign balance. Anyone reading my blog knows that I go on ad nauseum about the danger of the high current accounts deficit the US has been building from 1981 onward. I won’t go into the litany of problems I’ve noted there (here is a link to a post containing links to what I’ve written about the economy since May, when I started this blog); suffice it to say the situation in 2008 was probably worse than that of 1929.

5. The poor state of economic intelligence. That also clearly has been on parade in 2008, given how unprepared people were for the crisis, and how unsteady the political reaction has been. It would be a mistake to think they are on top of things now.

One other thing comparable between then and now is that directly after the crisis became known, for over a year in 1929-30 almost all the economic pundits and leaders were convinced that it would be a short recession, and not a depression. They consistently predicted growth would return within a year or so, and were reassuring in making it sound like it had simply been a speculation crisis, not one threatening the economic fundamentals. But then, as now, it’s the fundamentals which are out of whack. I still think, as I argued in Another Great Depression, that while we are facing extreme economic problems in the coming decade, it won’t be the same kind of depression. Yet I believe more people are underestimating the scope of the current crisis than overestimating it.

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What if Obama Loses?

Although things look good for Obama, there is still a chance that he could lose.  The McCain campaign has unleashed “robo-calls” in swing states or states where one would expect the Republican to be strong.  McCain’s campaign is down to one desperate measure: to try to make Obama appear risky and scary.  In swing states DVDs are put with newspapers to warn of “Muslim extremism,” the robo-calls suggest that Obama coddles terrorists, and McCain himself has taken to calling Obama a “socialist.”   Politico has reported that 100% of McCain’s ad spending is negative.  Normally this would have no chance of working, similar efforts against Bill Clinton failed dramatically.  There is one way it could work this time: if Obama’s funny name and the fact he is black cause enough whites to be far more sympathetic to those arguments than they otherwise would be.

Most McCain voters are already decided, and would be voting Republican no matter who the Democratic nominee was.   Others like McCain personally and their votes is based on that.  They fear either a Democratic majority in Congress plus a Democratic President, or in general believe the GOP best protects them against big government.  Culturally and ideologically, they would never vote for Obama, even if he were white and his name was John Smith.

I want to make that clear upfront so no one misunderstands this analysis.  I am not arguing that it is racist to vote for McCain, or that most McCain supporters are racist.  Yet I believe that if McCain wins this election it will be because a chunk of voters decided that Obama was “to different, strange or risky” to be President.

The polls show Obama with a comfortable lead in the swing states, and early voting in North Carolina and Georgia suggest he may even have a chance in those Republican stalwart states — making an Obama landslide possible.  Yet one cannot yet assume an Obama victory.  Most of Obama’s support emerged in the wake of the financial crisis, and thus is soft — many people could shift to McCain at the last minute.  Rather than trying to make the case in a positive way, McCain’s chosen to focus on attacking Obama, with the idea of making people fear that he is a risky choice.

If this works against Obama, it will be primarly because of race, and the inability of some segments of the American public to accept a black President.  If it doesn’t work against Obama, then that shows that Americans have indeed moved beyond the kind of racist reaction that in the past would have made an Obama candidacy impossible.   One could point out that similar efforts, including robo-calls by the same company employed now by McCain, helped George W. Bush defeat John McCain in 2000.  At that time he was bitter and angry about the dishonest campaigning.  Apparently, though, he’s learned that such is the way the game is played, and with the stakes so high, “anything to win” becomes the watchword.  So if negative campaigning can work, why would it be a sign that race is a factor of it does this time?

Here’s why:  right now the structural factors are all in favor of a Democratic victory, regardless of the candidate.  The economy is hurting, the public is more willing than ever to accept more governmental action, and McCain is a relatively weak candidate.  Obama has won the three debates, and McCain’s VP choice is the subject of ridicule.  Obama is outspending McCain by a large margin, and the public tends to agree with Obama more on the issues.  Structurally everything points to a Democratic victory and the Republican nominee is focused on a very specific, and sometimes even dirty, strategy to raise doubts about Obama the man.  This is meant to suggest that Obama is somehow “strange and different,” thus appealing to the racist elements still existing in American culture.

If that happens, there will be a lot of disillusion and anger, especially among minorities and the youth.  Again, Americans will have shown that they prefer a tired, old white guy against a vibrant, hopeful black.  If Obama loses, it will also show that people like me over-estimated the power of Obama’s ground game.  I believe that the intense voter registration and get out the vote campaign is a game changer, that could give states that still look unlikely for Obama (like West Virginia and Georgia, let alone North Carolina and Virginia).  But that’s speculation; an Obama loss would mean that these efforts had a minimal impact.  If that happens, there will be a lot of anger and disillusionment among people who have become very energized for the campaign.

Still, if Obama loses, the real lesson in this election season is how far we’ve come.  The fact that a black man named Barack Hussein Obama could make it this far shows that we are becoming a different kind of country than we were in the past.  No longer the white picket fence conservatives, we embrace diversity and are learning to truly accept blacks, women and others as viable leaders of this country.  Even if Obama falls short, it has to be remembered that 20 or 30 years ago this candidacy would not even have been possible, let alone capable of being truly competitive.

So, while I still expect a large victory for Barack Obama, in one sense the election already has reflected well on the American people.  Even the choice of John McCain, who rose from the ashes and was considered all but dead by the GOP because his maverick status and stance on immigration made him persona non grata for a large chunk of conservatives, is positive.  Of all the Republican candidates, McCain was probably the best.  And if he becomes President, he would be an improvement on what we have now (and Palin would be an improvement on Cheney).

To be sure, it’s sad that such intense and mostly quite dishonest negative fear mongering could even have a chance to succeed.  Yet if this kind of ‘gutter politics’ fails to stop Obama, that will show that the American public is becoming immune to those kind of fear tactics.

The bottom line is no matter how this is decided on November 4th, this has been a fascinating, historic election.

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Samantha Power for Secretary of State

She was born in Ireland.  She’s only 38 years old.  And she had to resign from Barack Obama’s foreign policy team during the primaries when she called Hillary Clinton “a monster.”  But with an inside the beltway Vice President in Joe Biden, Barack Obama, should he win the election (which is looking increasingly likely), could send a clear message by choosing Power as his Secretary of State.

A more likely role for her would be national security advisor.  Since she isn’t a native born US Citizen (she moved her at age nine, when her mother left Ireland because it did not allow divorce), she would not qualify for the Presidency should a disaster kill the four people in line in front of her.  But in a world with new challenges, Power would symbolize a new American foreign policy ready to go in a fundamentally different direction.

First, she has taken head on some of the more difficult issues in American foreign policy: human rights, and our inability to act in crises like Rwanda and Dafur.  Her book A Problem from Hell: America in the Age of Genocide is a must read for people concerned about why we are so quick to intervene in places like Iraq or Bosnia, but ignore other parts of the world with far worse atrocities taking place.   She has worked as a reporter for some of the top publications (The Economist, The Boston Globe, US News and World Report, and The New Republic), and still has columns appear regularly in Time.   She knows how to communicate, and in her reporting has demonstrated a wide range of knowledge about different world perspectives.

That in and of itself is important.  American Secretaries of States have seen their role as selling American foreign policy ideals to the world.  They use US power, status and promises of aid (or threats of reprisals) to try to get other countries to behave the way we want them to.  That’s how a superpower, especially one with a kind of neo-imperial reach like we’ve had at least until recently, operates.  However, that era is fading.  We need someone who actually understands the world, and tries to negotiate not simply to sell our preferences and get our way, but work out compromises and build partnerships.   That’s how to deal with 21st century problems.

Of course, being a journalist alone doesn’t qualify her.  She also has a law degree from Harvard, and currently teaches at the Harvard affiliated John F. Kennedy School of Government.   She is currently the Anna Lindh Professor of the Practice of Global Leadership and Public Policy at the Kennedy School.  Her academic credentials in foreign policy may not match those of Condoleezza Rice or Henry Kissinger, but compared to most Secretary of States in recent years, she would come to the job with a strong understanding of how the world works.

She would also counter the tendancy that Joe Biden might bring to see the world through the lenses of the “old school.”  Biden understands foreign policy, and I still think his idea of partition for Iraq may ultimately be the final outcome in that country which is not near as far along the road to stability as the Republicans want to pretend.  But he’s been shaped by an era where the US was the dominant actor, and our morals and values were accepted as universal goods.  Our goal was to spread democracy and human rights the American way.   Diplomacy was real, but built on a premise of American power as a given.  It is the kind of thinking that leads to fiascos like Iraq, or miscalculations like Kosovo.

Power would bring a new way of thinking to the role.  The US has to redefine its foreign policy in terms of global values rather than raw national interest.  Not because national interest is bad, but that in the 21st century it’s actually the development of global values that will best serve the national interest.  The dirty little secret of globalization is that it’s not just the ability to buy cheap Chinese goods or allow investment across borders.  It creates a new kind of interdependence whereby sovereignty no longer is the central defining role of the international system.  States remain nominally and legally sovereign, but their ability to act to control their destiny is shaped by forces outside their control.   Big, powerful states like the US and China can avoid having to deal with that for a longer period of time than smaller states, but it’s catching up to us now too.   The 20th century is gone.  That world is not coming back.

Power’s work focuses on the conjunction of how to create transnational values and the nuts and bolts of foreign policy.  She considers not just the power calculus, but the human side of world events.  That’s necessary if we are to escape the kind of power oriented approach that has shaped our approach in the past.   (Glibly: Power would bring to foreign policy a different perspective on power).  The old way isn’t going to work in the future.   And, though she did call Hillary Clinton a monster, she hasn’t been a divisive partisan figure.   Nonetheless, reports I’ve seen suggest that everyone who knows her considers her extremely strong.  She is said to have both a keen intellect and persistence — traits we need in our first diplomat.

This would be an ‘outside the box’ pick.  Most likely the Secretary of State job will go to someone with more inside political connections as a way to create a balanced Presidential cabinet.   Obama may even reach to a Republican like Richard Lugar, who could end his career with a very distinguished position.  And, to be sure, I’d be delighted to see her as National Security Advisor too.   But, though she’s covered the Yugoslav wars and certainly understands security issues, her background and approach seem better suited for the highly public Secretary of State role, rather than the more private and bureaucratic National Security Advisor position.

So I’m putting my plug in early for a daring but I think sensible and symbolically powerful choice for Barack Obama’s Secretary of State: Samantha Power.

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Obama wins again

First the post-debate poll results.

CNN: Obama 58 – McCain 31
CBS:  Obama 52 – McCain 22

This is one of the widest margins of any of the debates, and thirty minutes into the debate I’d have predicted otherwise.  McCain came out strong early, and Obama clearly was playing it safe.  I was already thinking about my post-debate critique.  It would be either McCain wins, or perhaps a draw.  I’d note it would mean a tightening race, and compare Obama to a football coach that plays it too safe too early.

But after the first half hour it was all Obama.   First, McCain spoke primarily to his base.  The stuff about class warfare, William Ayres, etc., will rile up the hard core Republicans who can’t understand why these issues don’t get everyone moving away from Obama.  More importantly, McCain appeared fidgety, angry, had inappropriate facial responses while Obama was talking, and just seemed a bit strange.  I believe this is why the CNN poll shows Obama being seen as “more likable” by 70%.  McCain didn’t fall so far behind on points — Obama was playing it safe, trying to make sure that he avoided being too negative or doing anything that could be read as unpresidential — but he appeared more the grumpy old man than the dignified President.

This was also seen in the response to the question asking each to compare their Vice Presidential choices.  The most negative thing Obama could say about Palin was that “The American people would decide” if she was qualified.  McCain went heavily negative on Biden about foreign affairs of all things.   Obama appeared Presidential, at best McCain’s attacks appeared Vice Presidential.

McCain did get the best line with the “I’m not George Bush” response, but as the debate wore on his smiles seemed forced and it appeared he was getting downright angry at times.  His strongest argument was that Obama was too liberal, but he again talked to the base.

So what next?  McCain blew the debate.  He needed to be steady and Presidential, instead he looked emotional and desparate.  Obama needed to stay cool and disciplined, and he did.  So in terms of the McCain comeback strategy I outlined a few days ago, McCain’s already failed to deliver on his first task.  Now, baring some kind of totally unexpected development, Obama is likely to cruise to victory.

Still, McCain has to finish the game.  Unless things move his way soon, the goal has to shift from winning the election to protecting incumbants in Congress.  That means the RNC shifting funding away from support of McCain towards important Congressional races, and McCain and Palin need to focus their schedule on what helps the party, not what gets them elected.   It’s not there yet — McCain has another week to try to at least show some movement in the polls.  But after this debate, Obama is in a commanding position.

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Spongebob Politics

One TV show I often wish my five year old wasn’t watching is Spongebob Squarepants.  From that show he learns words, phrases, and even humor that really isn’t fitting for a five year old.   Of course, I am the parent with the remote control, why do I let him watch it?  Well, first, I’m not a protective parent in the sense that I feel a need to control the various influences and not let him watch a show he really loves.  I limit total TV time and try to redirect, but if he really wants to watch Spongebob, I am not going to be a tyrant.  I still remember how I resented it when my parents thought I was “too young” to watch something.  The second is that I like the show and enjoy watching it with him.  At first I thought it was just weird, but it’s actually quite clever, with some really brilliant bits of humor.

Two recent episodes were specially good.   In one, Spongebob’s friend Patrick, a dim-witted a star fish, sees an elegantly clad gentleman and becomes terrified that it’s the librarian out to collect back fines.  Turns out it’s someone from the royal ministry, come to inform Patrick that he is actually the King of Bikini Bottom (that’s the town they live in).

Patrick isn’t sure what a King is, but when Spongebob tells him that it means he can have whatever he wants, Patrick becomes intrigued.  They go to the Krusty Krab (Spongebob’s work place — he is the perfect employee, and loves his job) and Patrick eats a lot pleasing the money hungry owner, Mr. Krabs.  Yet Krabs becomes upset when informed that Patrick, as King, can have whatever he wants free of charge.  He kicks them out of the restaurant, but Patrick is starting to enjoy this thing called power.  He then demands everything he can see…a comic book from a pathetic forty year old who finally has competed the collection he’d spent his whole life gathering, lollypops from babies, food from people on the street, and a walker from an elderly man.  They all give it up when told that royal decrees say they must.  Patrick becomes opulent, selfish and arrogant.

This all comes to naught when they move the home of Squidword, a more cynical Krusty Krab employee, to make way for Patrick’s new castle.  When told of this, an indignant Squidword goes on the rampage, “look at him!  He’s an idiot!  What possible qualification can he have to be King of Bikini Bottom?  Don’t give him anything!”

The citizens look at each other, decide Squidword’s right, and stop serving Patrick.  Patrick goes into a rage, that horrible Squidword has ruined everything, he is the cause, and must be stopped.  Finally, after Spongebob his loyal friend betrays him, Patrick looks in the mirror and sees the monster he’s become.  He freaks out, finds the man from the royal ministry and says he no longer wants to be king.  The ministry official understands, noting that “absolute power requires absolute responsibility” (but realizing that such language is above Patrick’s head) and informs Patrick that he isn’t the king after all — a coffee stain on the document reveals that really Spongebob’s pet snail Gary isn’t king.  And, while Gary can’t stand splinters, he doesn’t abuse power.

That’s got a lot of poli-sci in it.  Power corrupts.  People blindly acquiesce to injustice because of demands by “royal decree” or government law, not really questioning whether it’s just or ethical.  Then when things get really bad a rabble rouser finally wakes the people up who turn on the corrupt government.  The government of course blames the rabble rouser or revolutionary.  So when the Sandinistas rebelled against the Somoza government (Somaza was a lot like Patrick), the US and many anti-communists looked at it as a communist plot to spread their evil doctrine, rather than also compelled by people waking up to a grotesquely unfair social-political situation.  In almost every situation the leader of a revolt or country is considered the problem, not much effort is made to understand the deep social causes.  And power corrupts; even Patrick, the lovable dunce, gets overtaken by the desire for power.   In fact it’s those boorish ones, like Stalin in Russia or the businessman Uthman, chosen over Ali as third Caliph in the Islamic world, who was seen as unambitious and thus safe, who set up a corrupt regime that ultimately led to his son, Mu’awiyah taking the Caliphate by force and turning it into a military dynasty.

Another episode I ran into by chance last summer while teaching my summer term “Consumerism and Politics” course.  The new Education building has flat screen TVs upon which one can, among other things, show power point presentations.  I turned it on but it came on in TV mode, showing Spongebob.  We had been talking about the efforts by marketers to turn young children into consumers, and quickly it became clear this was an episode about that.  Mr. Krabs’ daughter Pearl is turning 16 and wants the perfect birthday party.  She gives her dad a list of gifts that she wants.   Mr. Krabs gives Spongebob the task of buying the perfect gift.  He follows Pearl to the mall, and we see an orgy of consumerism as she goes from one want to another.  Spongebob, who has been given Mr. Krab’s credit card (amazed that just giving a piece of plastic can buy something) has the best line when he buys one of Pearl’s gifts: “I’ll purchase that piece of plastic with this piece of plastic,” handing the clerk the card.

Meanwhile, Pearl comes home and Mr. Krabs has a pathetically lame surprise party ready.  “But I gave you a list!” Pearl wails, as her friends get ready to ditch her.  Then Spongebob shows up with a boatload of gifts, including a rock band Pearl loves, singing “it’s all about you, on your 16th birthday.”  She’s happy.  Mr. Krabs is horrified at the cost, but reasons that since he bought his daughter what she wanted, he’s a good father.

This episode was brilliantly timed for that class, mocking our rampant and excess consumerism.  Reflecting on these two episodes, I’m not sure what to think.  I like them, they are cutting satire.  They are also not really the stuff five year olds can understand.  Yet the irreverence and perhaps a bit of the satire might rub off on kids.  And, as one who prefers irreverence, laughter, and rebelliousness to orderliness, seriousness and conformity, I’m not sure it’s really that bad an influence after all.  It just requires me to teach him not to use certain words or sayings (e.g., ‘you are such an idiot.’)

And, frankly, it’s better than Sesame Street.  I’ve been told Cookie Monster has morphed into a more healthy “veggie monster,” that Oscar the grouch is no longer there because of his negativity (might cause the kids to have negative thoughts), and Big Bird’s imaginary friend is gone because, well, I guess imaginary friends are no longer seen as good.  It seems that in a desire to be politically correct, Sesame Street has become a sanitized and boring show — one my son constantly refuses to watch.

So give me Spongebob.   Better a cutting, funny show my child likes than a boring politically correct show that he can’t stand.

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McCain Comeback?

I posted last week, and still believe, that the campaign is essentially over and that barring something completely surprising, Barack Obama is on course to become our 44th President.  However, there is three weeks left in the campaign and McCain could still turn it around.  The reasons not dismiss completely the idea of a McCain comeback aren’t compelling, but are real: 1) Obama may be peaking too early, and if the financial mess fades from the headlines, people may start to rethink their position; 2) Obama had trouble closing the deal against Hillary Clinton, so he may not be able to finish as strong as he needs to; 3) Obama’s support is softer than McCain’s, and thus there is a greater chance people currently supporting him could change their minds; and 4) undecideds who haven’t been swayed to go for Obama by the current financial mess are perhaps more like to end up voting for McCain than Obama.   So despite appearances, the GOP still has some hope.  And for me, an interesting question is what kind of strategy would McCain need to come back?

First, he needs some help from the environment.  No more negative stories like the Sarah Palin interviews or troopergate report.  The financial crisis needs to fade in relative importance (though no one thinks the economy won’t be issue one), and there can be no bad surprises from Iraq and Afghanistan.  In short, the environment has to be such that McCain has a chance to control the story line during the final three weeks of the campaign.

Second, he needs to win Wednesday’s debate.  He doesn’t have to “whip Obama’s you know what,” as he boasted he’d do, he just needs to pull off what most analysts might say is “his best performance,” one that will “do him no harm.”  Debates are only a small part of the campaign; if he overshoots and tries for a KO, Obama will likely be able to out manuever him.  But make no mistake, he needs a strong performance to mount a comeback.

Third, he needs to avoid the temptation to try any more “hail Mary’s.”  At this point he may be tempted, gambler that he is, to try for something big.   But his attempts to do so in the past — the choice of Palin, the decision to suspend his campaign and then to back off, off and on attempts to inspire anger among the GOP faithful, and shifting reactions to the financial crisis have created doubts that this 72 year old is really on top of things.   Since his job in the next three weeks will be to create doubt that Obama is up for the job, he has to work to overcome the reputation he’s getting for being erratic himself.  He can’t undo past mistakes, but he has to be steady as a rock for three weeks, and avoid looking like he’s desparate.  Like a football team behind by three scores at the start of the fourth quarter, he needs to focus on ‘one touchdown at a time,’ and not panic.  If he’s behind by 10 on November 2nd, he can throw deep.  Otherwise, he needs to steady his game.

Beyond that, he does need to continue to have his surrogates and his campaign talk about Rev. Wright and William Ayres.  I know, those of us who prefer Obama find such attacks to be a distraction, unfair, and based on fear mongering and racism.  They are a sign of a candidate behind who is willing to do anything he can to win.  But McCain is behind, and putting on a strategist’s hat for the moment, the key is to do whatever it takes to win.  So being Machiavellian about this — the “is” rather than the “ought” — it seems to me essential that McCain foster seeds of doubt about Obama if he is to have a chance.   To work this must not be the centerpiece of his campaign.  If it gets too much push, McCain will appear again erratic and desparate; Americans don’t want a negative campaign at this point.  He needs to have it present, but subdued.  It need not itself sway voters, it must only ‘soften up’ already soft Obama voters, and make them more willing to change their minds.

McCain must then have a persistent, steady approach that stresses small but effective government, tax relief, a bold but not bizarre plan to deal with the financial crisis (no ‘special prosecutors’ or anything like that), and reinforce the idea that the American people have “always known and trusted John McCain to be a conservative pragmatist.”  The only way McCain can win this is not to have people suddenly think Obama is a scary terror coddling socialist.  Rather, for people to decide that though they think Obama a decent and well intentioned man, at this point McCain is a safer choice.

The main reason why I think that even if McCain does everything right he won’t be able to pull this off is Obama’s spending advantage, get out the vote effort (untested and thus uncertain, to be sure), and disciplined campaign.  True, he didn’t deliver a knock out blow to Clinton.  But he held back, he knew he’d need to win the support of Hillary, Bill and their supporters.  Most have switched to Obama now and as I noted then, the intense primary race probably helped rather than hurt Obama.   Still, McCain has a chance if he eschews efforts for dramatic hail Mary’s, let’s Palin take care of the base, has an environment without further shocks and disruptions, and mixes a continuing negative line of attack against Obama with a postive, steady message.  His first job will be to win — even if very narrowly — Wednesday’s debate.

With the mood of the country the way it is, Obama’s job is much easier.  He must convince voters that he is qualified by temperment and character to be President.  He has gone a long way in making that sale in the first two debates, and with a lot of ad money available, will have every chance in the world to make that case during the next three weeks.  He needs to fend off the negative attacks from McCain, and maintain the subtle criticism of McCain as desparate and erratic.   If he can make McCain look risky, it undercuts McCain’s efforts to make Obama look risky.  Finally, he can’t just sit on his lead, he has to keep doing what he’s been doing, and continue to use any negative attacks from the right to motivate his base.

About 15 years ago the Buffalo Bills erased a Houston Oiler lead of 32 points early in the second half to come back and win the game, a feat called by some the greatest comeback ever.  A McCain comeback now would be on a par with that one.  Perhaps McCain should try to contact Frank Reich, the Bill’s Quarterback on that day, to see if he can come manage his campaign.

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The Boom, 1945-2008 (RIP)

One thing a blog allows one to do is to make bold and admittedly arrogant statements about politics and history.  Know only that I realize I’m on a limb here, and I hope I’m wrong.  But I believe we have lost a 63 year old friend and comrade: the post-WWII economic boom.  Instead, we’re in for, if not a true depression, at least a lengthy recession, followed by a global economy where the US and the West no longer run the show.

In a touch of irony, the boom ends when the first “boomers,” that post-war generation from 1945 – 1960, start retiring.  Officially I am a boomer too, though barely — I was born in 1960, at the tail end of the boom, the last year of the Eisenhower administration.   Assuming my job doesn’t disappear, I don’t plan to retire for 25 more years.  But some early boomers are retiring, having lived their entire lives during a time when the US economy has experienced an unprecedented growth in material prosperity compared to any time in history.

And I don’t mean unprecedented in US history.  I mean unprecedented for any time in written history EVER.  The amount of material wealth and prosperity created in the industrialized West from the end of WWII to the present is phenomenal.  Even the lower middle class live lives of convenience and comfort unimaginable in the past.  Better to be an average American worker than even a member of the aristocracy 200 years ago.  We have soft beds, safe, tasty food, good health care, entertainment that surpasses anything imaginable in the past, and power at our fingertips.

Conservative Senator Jesse Helms once induced scorn when he said that “our poor people are fat,” but he had a point.  Being poor in the industrialized West is often much, much better than being average in much of the Third World.  Some of the inner cities and slums are horrific, but for the most part, we in the industrialized West have a truly prosperous existence.

The boom took place for a variety of reasons.  Perhaps most important was free trade.  After WWII the US was in a position to create a free trade regime, which loosened trade restrictions world wide, widening the production possibilities frontier and expanding global output.   Trade has never been truly free, of course, but compared with the pre-war era, the destruction of barriers to trade have been phenomenal.  Similarly important was the ability to create a sound investment regime.  Unlike the speculative bubble that defined the 1920s, investment during the boom was, until the final years, generally stable and rational.  This was due to sound regulations, rational policy from central banks, and in general the fact that one did not need to delve into the realm of irrationality to do very well.

However, something happened around 1985.   The world of prosperity created after WWII was one based primarily on sovereign states trading and interacting.  They would regulate themselves internally (especially investment regimes and credit markets), and then trade and cooperate internationally.  After 1985 the watch word became globalization, and soon intra-state regulations ceased to function.  The US found it could sustain current accounts (primarily trade) deficits and finance two speculative bubbles in a row by borrowing from the world — in particular China and Saudi Arabia.   Those two states benefited because we bought their goods and oil, and they relied on a strong US economy to drive demand.

As in 1929, some saw this coming, but most did not.  The conventional wisdom that “the system is sound” was too strong, and thus everyone found reason to believe.  But as in 1929, these speculative bubbles, particularly the housing bubble recently punctured, were built on a credit bubble.  The dirty secret of capitalism is that the hidden hand works poorly in credit markets.  There greed combines with very imperfect intelligence to create an incentive for quick short term profits at the long term expense of the economy.  Simply, credit markets need regulation.

Yet, as any true capitalist will tell you, the regulators are not necessarily better than the market at understanding and controlling events.  Indeed, that’s the Hayek-inspired view that the market is always better, numerous small decisions based on the pooling of individual information will trump imperfect bureaucratic decisions, based on information surmised by a small group of inadequately informed officials.  Yet in credit markets often those individual choices are so warped by short term greed and a fundamentally misunderstanding of the situation that a long term protective regulatory scheme is better.  That must, however, be learned.  The Great Depression was a object lesson for regulators during the time of the sovereign state, and they learned the lesson reasonably well.

The era of globalization, however, has altered the nature of the game.  Governments have learned they can borrow tremendous amounts of money to fund short term programs, rationalizing the long term impact by pointing to future growth.  This isn’t just a creation of the left; the Reagan Administration, which saw American budget deficits balloon from 30 to over 60% of GDP, infamously proclaimed budget deficits irrelevant.  Banks quickly discovered the benefits of private debt too.  It padded the asset side of their books, and appeared relatively safe — so long as economic growth and prosperity continued onward and upward.  The only thing that could threaten this state of affairs would be a deep recession.  Normal recessions aren’t deep, they are corrections to an overheated economy.  Economists and politicians thought they had this all figured out, hence the recurring recessions of the boom era were minor and, while sometimes feeling intense (the 1974, 1981 and 1991 recessions all caused alarm), were ultimately meer bumps on the road to increased prosperity.

Yet a recession can become deep, even a depression, if it comes on the heals of a speculative bubble that threatens credit markets and the nature of the banking system.   That’s what is happening now.  Despite words proclaiming that “things will be better soon,” there is reason to believe the “Great Boom” is now over.  The question is not if things will get tight, it’s more “how tight will things get?”

The government intervention to save credit markets by covering bad debt is designed to make sure that credit, the lubricant of a capitalist economy, doesn’t dry up.  It’s the equivalent of adding new oil to an overheated engine.  The question is whether or not damage to the engine is so great as to make this new oil irrelevant.  Moreover, given high government debt and bureaucratic inefficiencies — not to mention a penchant for corruption — a socialized credit system is unlikely to prove effective.   At best it’s a short term solution; at worst it’s an illusion.  “Something is being done.”  Great — but if that “something” is really as bad if not worse than “nothing,” it’s not too comforting.

Moreover, we haven’t learned the lessons from this crisis yet.  What does it mean that the US relies so much on Chinese largesse and Saudi petrodollars?  Does the US current accounts deficit need to be brought into balance, and if so, how can that be done?  Does the global nature of the world economy mean that the pain of these imbalances will be shared, also meaning that there is no “national” solution?  Will these problems kill globalization, and bring back stronger, inward looking nation-states?   Is that even possible, given global business and finance?   Can a regulatory regime be created in an era of globalization to try to control credit markets without bringing the stifling choke hold of over regulation and bureaucratization?

The good news is that the answer to the last question is probably yes.  The bad news is that it may take a global depression, and possibly political unrest and even war, before we learn that lesson.  Get ready for a bumpy ride!

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Columbus Day

Cristoforo Columbo, wearing a trenchcoat and smoking a cigar (ooops, wrong Columbo) I mean, sailing with the Nina, Pinta and Santa Maria “discovered” the new world and thus opened the way for the spread of western civilization.  In so doing, he battled against European beliefs that the world was flat, and he’d sail over the edge.  His brave and daring mission represents the true explorer spirit, and thus from space shuttles to TV detectives to capital districts, Columbus, Columbia, and Columbo all attest to this glorious explorer’s mission.  At least, that’s the story.

Very few people in Europe believed the earth was flat by 1492, and Columbus himself never realized he’d discovered the new world.  Based on his conjecture of the Earth’s circumference he thought he was in Asia, and he constantly sought a passage to the wealth of India and China.  Moreover, as a Governor of one of the colonies he was accused of friend and foe alike of tyrannical rule and atrocities.  It is almost certain that he does not live up to his mythic image, but is his legacy even more dubious?

Many people argue that we should simply cease celebrating Columbus day (or, the more “subversive” claim, rename it something like National Genocide Day or Mass Murder Day).  Columbus not only committed atrocities, but brought disease, suffering and ultimately European conquest to a relatively stable and generally peaceful world of Native American nations and tribes.  In that view Columbus is a villain, and it is hypocrisy and dishonesty to even have a day off for him (traditionally today — October 12th — the day land was sighted in the Bahamas, though now it’s the second Monday in October).

Ah, Americans and their “evil individual fallacy.”  Columbus was neither great nor evil.  He isn’t worth being celebrated, but he’s also not so bad that he should be demonized.  He was not the motivator and enabler of the genocide that followed, he simply was known as one of the first Europeans in what certainly was an inevitable European conquest of the new world.  He committed atrocities, but was not the cause for Spanish massacres in South America, or the low tech holocaust of North American Indian tribes.   Columbus was simply a sailor and a business man, apparently both cruel and arrogant, though supposedly religious as he neared the end of his life.

But who really cares about the man?  Does the man even matter?  Is it, in fact, a kind of cultural silliness that we fixate on individuals so much, from Columbus to Saddam Hussein?  What happened on this continent from 1500 to about 1900 was a persistent and violent conquest and genocide, which saw entire peoples wiped out by disease and war.  It was the result of a mindset that saw the West as superior and thus western deaths were important, while “savage” deaths were not.  If we could spread our way of life and politics, it was to the benefit of others, even if large masses were killed in the process.  It was a kind of inhumane abstract cultural arrogance that drove the Europeans to this barbarism, mostly unquestioned at the time, and even to this day, not seen clearly or truly accepted.  Do we risk a kind of self-congratulatory sense of “standing up for humanity” by not recognizing this holiday?  Look at our behavior today — is our culture really that much more advanced in terms of its actions in the world, from treatment of other peoples, exploitation for economic profit, and lack of concern for the environment (despite evidence of devastation being done)?

I don’t really care much about Columbus or Columbus day.  I love having a day off at the peak of autumn foliage, and certainly do not want to give that up, no matter what the day is called or who it is named after.  But Columbus himself isn’t that important.  Coming to grips with the past isn’t telling the true story of Columbus; he was in actuality a bit player, pushed into the limelight through happenstance of history.  Coming to grips with the past encompasses a greater swath of history, a critical look at our ideals and values, and an examination of how we got to where we are today.   Attacking the celebration of Columbus day is misguided; coming to grips with the past and its impact on our present way of thinking really doesn’t require us to think too much about Cristoforo Columbo.  It requires us to confront our past on every level.  So enjoy the autumn foilate, and happy Columbus Day!

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Fear, Racism and the Campaign

The following is from a story in Politico (http://www.politico.com/news/stories/1008/14479.html):

“Fearing the raw and at times angry emotions of his supporters may damage his campaign, John McCain on Friday urged them to tone down their increasingly personal denunciations of Barack Obama.

It won him two rounds of boos from his own supporters.

“I have to tell you. Sen. Obama is a decent person and a person you don’t have to be scared of as president of the United States,” McCain told a supporter at a town hall meeting in Minnesota who said he was “scared” of the prospect of an Obama presidency and of who the Democrat would appoint to the Supreme Court.

“Come on, John!” another audience member yelled out as the Republicans crowd expressed their dismay at their nominee.

Another woman went even further.

“I’ve heard that Sen. Obama is an Arab,” she said.

McCain, who had shared his wireless microphone with the voter, yanked it out of her hand.

“No, ma’am,” the Arizona senator assured. “He’s a decent family man and citizen that I just happen to have disagreements with on fundamental issues and that’s what this campaign’s all about. He’s not [an Arab].”

Thank you John McCain.  The stories today about the anger and the increased negative campaign tactics from the McCain-Palin campaign have created a kind of divisiveness that the country doesn’t need at this time.  John McCain is doing what must be done to prevent that, though his campaign still can be blamed with “going negative.”

Even George Will has been critical about the McCain campaigns sudden shift into negativity.  McCain and unsurprisingly FOX news has been trying to tie Obama to a 60s radical turned education professor.  FOX seems to trumpet this story constantly and for long periods of the last couple of days has Ayres image on the screen, as if trying to create a story from nothing.  This has helped incite growing anger and emotion at McCain rallies as polls increasingly suggest the odds are very good that Barack Obama will be the next President.  The campaign seems to want to focus less about issues, and more about raising questions about Barack Obama’s character.

If Obama were white, this kind of tactic wouldn’t stand a chance.  President Bush the Elder tried a similar line of attack on Bill Clinton, and it backfired.  Then as now the campaign realized in the last month that it was losing to a young, untested and inexperienced upstart, and decided the way to win was to focus on Bush being experienced and steady, while Clinton was a womanizing draft dodging dangerous dilettante.  The arguments against Clinton were far more powerful than the arguments currently against Obama.  Bush could call on Clinton’s past, both documented and alleged, while the best McCain can do is try a weak guilt by association ploy.

The facts first: William Ayres was a 60s radical involved in violence.  He later became a professor of education (he was acquitted for his crimes due to illegal government wiretaps and the like), and a leader in Chicago education reform.  He has been embraced by Chicago Mayor Daley for his efforts (Daley has been praised by McCain), and was part of a project that received funding Annenberg, an organization created by a conservative Republican.  Obama served leading a board overseeing how that grant was spent, a board on which many people sat, conservative and liberal, including Ayres.

How, one might wonder, could this possibly be used against Obama?  Should he have refused to participate in a grant that helped Chicago children get an education by indignantly refusing to have anything to do with someone whose past contained radicalism?  And what about the conservative organization funding the grant, or the others on the board?  There is no way this can possibly be seen as negative against Obama; compared to the charges heaped on Clinton in 1992.

Absurd?  Yes…unless…unless there still is within a large segment of the American electorate a real racism that needs only a slight bit of stoking to invoke fear.  The idea here is that people already see Obama as different.  He’s a Harvard educated lawyer, black, raised by a single white mother and his white grandparents, and his biological father was from Kenya.   He lived for a while in Indonesia, and his name is different:  Barack Hussein Obama.  The middle name has been stressed more at McCain campaign rallies in the last week.  Hussein…is he Muslim?  Of course not.  But perhaps because he’s black and his name is different, well, people will wonder about him.  Perhaps hinting at an “association with terrorists” will paint a picture of a man who might be friendly to Islamic extremism.  Perhaps we can’t trust this black man with the strange name.  Maybe it’s safer to vote for the old white guy.

I pointed out yesterday, not only do people vote for the person rather than the issues or ideology of a candidate, but it is rational to do so.  If McCain can raise doubts about Barack Obama the man in the mind of voters in swing states, maybe he can alter the dynamic of the election.  It’s a cold, cynical, even dirty strategy.  But politics is a cold, cynical dirty business.

The Obama campaign has a strategy to respond.  They have been airing “bio” ads stressing his “Americanness,” and is going to buy half hour ad blocs on major networks the week before the election.   Given how disciplined, effective, and cash-rich his campaign has been, one expects that they will be pro-active and effective in countering the mud slinging strategy.  They will likely sling some mud of their own, using indignation for McCain’s strategy as a rationale.

We don’t know what the impact of race will be on this election.  We don’t know if the higher vote turn out that is expected from Obama will actually occur, or if it will offset the “race factor.”  And, to be sure, Obama is hoping for a high minority turn out, voters who will be voting explicitly for him because he is black.  Race in this contest is a complex issue.  Until election night, there will be some uncertainty.  But as the McCain campaign, after a series of stumbles, heads into negativity, emotion and anger as their primary attempt to turn the dynamic around, the next few weeks will say a lot about what kind of country America has become.

Some quotes suggesting that this is a dangerous direction, first from John Weaver, former top strategist for John McCain:

“People need to understand, for moral reasons and the protection of our civil society, the differences with Senator Obama are ideological, based on clear differences on policy and a lack of experience compared to Senator McCain,” Weaver said. “And from a purely practical political vantage point, please find me a swing voter, an undecided independent, or a torn female voter that finds an angry mob mentality attractive.”

And CNN commentator David Gergen:

“One of the most striking things we’ve seen in the last few day, we have seen it at the Palin rallies and we saw it at the McCain rally today, and we saw it to a considerable degree during the rescue package legislation. There is a free-floating sort of whipping-around anger that could really lead to some violence. And I think we’re not far from that.”

John McCain has the moral and ethical responsibility to fight against such things, and not feed the flames.  The quote at the top about a campaign stop in Minnesota suggest he recognizes that while an energized base is important, he can’t let it devolve into an angry mob.

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