Archive for 2011
July 15, 2011
WHY DOES PEDIGREE drive law faculty hiring? America’s governing class has become more incestuous in the ways that matter, even as it has loudly pursued “diversity” in the ways that do not.
BYRON YORK: Energized By Debt Fight, A Battered Gingrich Pushes On.
When Obama says he can’t guarantee that Social Security checks will go out if there is no deal, Gingrich urges House Republicans “to pass a $100 billion cut with a $100 billion debt-ceiling increase, which takes care of all the Social Security checks in August. Say to the president, ‘OK, we’ve taken care of everybody who needs to get a check in August. Are you going to tell Senate Democrats to block it? Are you going to veto it?'” In North Charleston, it’s what the audience wants to hear.
I don’t know who will win the Republican nomination (and I doubt it will be Gingrich) but it’ll be someone who’s willing to stand up and fight. And that’s who’ll beat Obama, too. Nobody’s going to accommodate their way into the White House.
FORGET THE DEBT CEILING: S&P: U.S. Debt Could Reach ‘Junk’ Rating by 2030, Absent Entitlement Reform.
Key words: “Entitlement Reform.”
UPDATE: WSJ: The Obama Downgrade: The real reason the US could lose its AAA rating.
So the credit-rating agencies that helped to create the financial crisis that led to a deep recession are now warning that the U.S. could lose the AAA rating it has had since 1917. As painfully ironic as this is, there’s no benefit in shooting the messengers. The real culprit is the U.S. political class, especially the President who has presided over this historic collapse of fiscal credibility. . . .
On spending, it is important to recall how extraordinary the blowout of the last three years has been. We’ve seen nothing like it since World War II. Nothing close. The nearby chart tracks federal outlays as a share of GDP since 1960. The early peaks coincide with the rise of the Great Society, the recession of 1974-75, and then a high of 23.5% with the recession of 1982 and the Reagan defense buildup.
From there, spending declines, most rapidly during the 1990s as defense outlays fell to 3% of GDP in 2000 from its Reagan peak of 6.2% in 1986. The early George W. Bush years saw spending bounce up to a plateau of roughly 20% of GDP, but no more than 20.7% as recently as 2008.
Then came the Obama blowout, in league with Nancy Pelosi’s Congress. With the recession as a rationale, Democrats consciously blew up the national balance sheet, lifting federal outlays to 25% in 2009, the highest level since 1945. (Even in 1946, with millions still in the military, spending was only 24.8% of GDP. In 1947 it fell to 14.8%.) Though the recession ended in June 2009, spending in 2010 stayed high at nearly 24%, and this year it is heading back toward 25%. . . . The President is now claiming to have found fiscal virtue, but notice how hard he has fought House Republicans as they’ve sought to abate the spending boom.
Junk leadership and junk policies lead to junk status.
UPDATE: This reminds me of the Insta-Dad’s prophetic take on TARP: “The bad thing is that the federal government has figured out that it can borrow a lot more money than it previously thought.”
HARRY REID REFUSES TO SAY whether tax increases are more important than avoiding default. I think we can figure out his true view on the subject, though.
MARK TAPSCOTT: Why 2012 is shaping up as an ‘Anybody But Obama’ election.
HIGHER EDUCATION BUBBLE UPDATE: Reader James Ingram emails:
Sorting out my old papers preparing to move I discovered my 1975 admission letter to a tier one private law school. Tuition was $3800. According to the USDOL BLS web site $3800 in 1975 dollars adjusted for inflation (using CPI) is $15960. Actual 2011 tuition at this school is $47,600 (not counting $3000 in required fees), 3 times inflation.
By contrast, starting salary at a tier one law firm in the city where this school is located when I graduated in 1977 (I was a transfer) was about $22 – 23,000. Adjusted for inflation this would be $82, 033 in 2011. Starting salaries at the same level firms in 2011 (if they are hiring) are $135 – 145,000, about 1.75 times inflation.
Yes, the cost of education — and the debt involved — has increased more rapidly than the payoff at the end. Plus, the payoff at the end has become considerably more uncertain.
THE NEW REPUBLIC: Sinking Fast: Obama’s Multiplying Middle East Failures.
JAMES TARANTO: Revenge Of The Nerds? The political dangers of an intellectually superior attitude. “This sort of know-it-all attitude is useful to a pundit like Krugman, whose readers share his sense of superiority. It might have been useful to Barack Obama when he was a state senator from a college town. But for someone who actually needs to persuade tens of millions of people to vote for him, making a show of one’s presumed superiority can be hazardous. . . . What got our attention about this exchange as reported by Cantor is the president’s threat to take his case ‘to the American people.’ Would those be the same American people who aren’t paying attention and don’t understand all this complicated stuff? This seems to us an empty threat not least because since his election, Obama has a poor track record when it comes to taking his case to the American people–who still overwhelmingly oppose ObamaCare, give him poor marks on the economy, and think the debt limit shouldn’t be raised even though it pretty much has to be.”
MARK DAYTON’S SHUTDOWN BACKDOWN: Why Minnesota Matters. “This is Minnesota. Republicans have mostly won a pitched battle with a Democratic governor on spending and taxes in a liberal state. Dayton caved on his signature issue. If Republicans can make it here, they can make it anywhere.”
WHY WALL STREET doesn’t seem worried about default.
SYRIA UPDATE: Protests Spread. “As the Syrian uprising enters its fifth month, activists and human rights groups say they are detecting a new momentum in the protest movement, with demonstrations now taking place on a near-daily basis in towns around the country. Among them are places where the uprising had seemingly been suppressed, such as the southern town of Daraa, the earliest focus of the government’s crackdown, where hundreds of people staged a demonstration on Thursday in a central commercial district.”
RICK PERRY AND NIKKI HALEY: Break The Spend-And-Borrow Cycle. “We oppose an increase in the federal debt limit unless three common-sense conditions are met: substantial cuts in spending; enforceable spending caps to put the country on a path to a balanced budget; and congressional passage of a balanced-budget amendment to the U.S. Constitution. That amendment should include a requirement for a congressional supermajority to approve any increases in taxes.” Nice to see the GOP’s 2012 ticket finally weighing in. . . .
July 14, 2011
MEGAN MCARDLE: Call His Bluff:
So how can the GOP get something it wants out of the sodden mess of our debt negotiations? Here’s my answer: pass a short-term debt-ceiling increase. It seems pretty clear to me that there’s no time or common ground for a grand bargain before August 2nd, so pass a short-term increase. Give him nine months. Call his bluff.
Because it is a bluff. Obama is not going to shut down the government rather than accept a short term deal. He’s also not going to default. Doing so would virtually ensure that even if he doesn’t have to raise the debt ceiling in 2012, come January 2013, he’ll be cleaning out the Oval Office to make room for the next resident.
Is this what I would have liked to get out of this confrontation? Certainly not; I’d have liked a broader deal that raised some new revenue and cut a lot of spending. But I think the time for that is past. What you can do is make the White House have a lot more conversations like this. . . . And if I’m wrong, and he does force a default, then it’s the fault of the Democrats, not you! It doesn’t get much better than that, right?
Indeed.
Related: Mickey Kaus: How would this not be a defeat for Obama? “So Obama’s macho’Deal-by-Friday-or-time’s-up-on-to–Plan-B’ ultimatum is actually an obvious, slightly desperate attempt to avoid the cuts-only take-it-or-leave-it no-brainer ploy that even E.J. Dionne and Jennifer Rubin and NRO’s editors talk about, right? … P.S.: Looks as if Obama might get a cuts-only deal in a McConnell Plan B “hybrid” anyway. Jon Alter seems to have missed that part. … P.P.S.: Objectively (as we Marxists say) that would be a defeat for Obama, after his showy insistence on revenue increases, no? He’d still wind up with all cuts, no new revenues. But why do I suspect it’s all OK with Obama as long as he can look like he’s in charge? Avoiding Carterization is Job #1.”
A little late for that.
And reader Brad Sandy writes: “All those people that think Obama wins in a shut down don’t see his poll numbers and remember this fact…everyone thought he would be a uniter and an engine of change not the person responsible for a shut down because nobody gets along. This will be the final straw for many.”
Yeah, that whole hope-and-change narrative hasn’t lived up to the hype. Republicans should be reminding people of the promise vs. the delivery.
DIET DEPENDS ON INCOME.
AT AMAZON, markdowns in Home Audio & Video.
IS GOOGLE SPYING ON YOU? Yeah, pretty much.
DOES OBAMA REALLY BELIEVE IN “EVOLUTION?” Obama Tries to Resurrect ‘Don’t Ask, Don’t Tell’ – Again.
THEY TOLD ME IF I VOTED FOR JOHN MCCAIN, WE’D SEE A NEW ERA OF RACIAL VIOLENCE IN AMERICA. And they were right!
DEMOCRAT CAVES AFTER GOVERNMENT SHUTDOWN GAMBIT FAILS: “As I read Governor Dayton’s letter to the Republican leadership in the legislature, the most notable fact is that Dayton has given up on imposing tax increases as a condition of ending his shutdown of state government. Why did Dayton agree to end his shutdown now? This is pure speculation, but my guess is that he is looking at poll data that are not supportive of his position.”
From the comments: “So, he was willing to shut down the state government until the liquor supply was threatened. Huh.”