Monthly Archives: August 2007

Politics

Subprime

Thomas Sowell on the subprime loan implosion:

Politicians have also been a key factor behind pushing lenders to lend to borrowers with lower prospects of being able to repay their loans.

The Community Reinvestment Act lets politicians pressure lenders to make loans to people they might not lend to otherwise – and the same politicians are quick to cry “exploitation” when the interest charged to high-risk borrowers reflects that risk.

The huge losses of subprime lenders, some of whom have gone bankrupt, demonstrate again the consequences of letting politicians try to micro-manage the economy.

Yet with all the finger-pointing in the media and in government, seldom is a finger pointed at the politicians at local, state and national levels who have played a key role in setting up the conditions that led to financial disasters for individual home buyers and for those who lent to them.

While financial markets are painfully adjusting, and lenders and borrowers are becoming less likely to take on so much risky “creative” financing, politicians show no sign of changing.

Why should they, when they have largely escaped blame for the disasters that their policies fostered?

I don’t quite agree with Sowell here. He’s right in some aspects but we must remember that markets get stupid sometimes. The subprime lending market has been compared to the dot-com bubble and the comparison is very apt. A lot of banks knew they were acting stupidly and are paying the price.

Of course, where there’s dumb ideas, there are even dumber ones and a truly idiotic idea floating around right now is that the government should bail out the subprime mortgage lenders or, even worse, the borrowers themselves. Democrats in particular have been promulgating this piece of pander.

It’s a terrible idea. The market has to correct. If it doesn’t, we will get even worse loans made and the industry will completely explode in about 2012. Right now, it’s just taking the Dow Jones with it. We subsidize this nonsense and it might take down the entire banking industry.

Let the forest fire burn. We need to clear out the dead wood of bad loans.

Politics, Science and Edumacation, Taxes and Spending

Thursday Night Linkorama

I just can’t seem to find the time for half a page of scribbled lines. I’m way behind on blogging these days. But the lawn is mowed, the babby asleep and the wife placated. Here’s a linkorama to tide over until I get my mojo back.

  • The Democrats are worse with the pork than the GOP. Of course, Bush might actually veto some of this crap.
  • The IRS already wants their piece of the Bonds Ball. Christ, can’t they leave the guy alone for ten minutes? It’s not worth anything unless he sell it. FYI – the guy who caught McGwire’s ball and gave it to him? The IRS tried to get him too.
  • Stephen Bainbridge compares what Bush supposedly said to what he actually said. Look, liberal dweebs. It does not do your side any good to misrepresent what the President says. Doesn’t he mangle the language and logic enough on his own?
  • NYT debunks the idea that we need to get food locally to save the planet. The thing is, you don’t need a sophisticated analysis to tell you that the environment is better off when we get our lamb from New Zealand than from next door. The market is already telling you that – with the price.
    • Politics

    The Problem

    NYT has a great article on infrastructure problems. This isn’t just a Republican thing and it’s not a spending thing:

    Despite historic highs in transportation spending, the political muscle of lawmakers, rather than dire need, has typically driven where much of the money goes. That has often meant construction of new, politically popular roads and transit projects rather than the mundane work of maintaining the worn-out ones.

    Further, transportation and engineering experts said, lawmakers have financed a boom in rail construction that, while politically popular, has resulted in expensive transit systems that are not used by a vast majority of American commuters.

    ….

    Of the $12 million secured for the state, $10 million is slated for a new 40-mile commuter rail line to Minneapolis, called the Northstar. The remaining $2 million is divided among a new bike and walking path and a few other projects, including highway work and interchange reconstruction.

    The $286 billion federal transportation legislation passed by Congress in 2005 included more than 6,000 earmarks, which amounted to blatant gifts to chosen districts, including the so-called Bridge to Nowhere in rural Alaska (that earmark was later removed after a political uproar).

    I would also point out that if the government weren’t spending its time running (and ruining) health care. managing charities, engaging in corporate welfare and bossing us around about what’s on TV, they might have more time and money to focus on infrastructure.

    It’s not just road either.

    Politics, Socialism, Taxes and Spending, The Nanny State

    Sunday Sunday SUNDAY Linkorama

  • A fantastic story in the NYT about how New Zealand farmers are better off without subsidies. P. J. O’Rourke said the best thing to do with farm subsides was to take them behind the barn and kill them with an ax. That looks more true with every passing day.
  • Neal Boortz has an interesting breakdown
     of where all the highway money in Minnesota has gone. People are blaming the Governnor for not raising taxes. In the meantime, the state spent $1.5 billion on bailing out the Teachers’ Retirement Fund and building a stadium for the Twins.
  • Cato on the liberal media again. I don’t mind a media that’s biased, but I do mind paying for said bias. But as we all know, only Fox News is biased. Everyone else is just “right”.
  • Continuing on the liberal media theme, the NYT has their article on the SCHIP bill. Notice that they don’t even question any assumptions, failing to point out that SCHIP will cover “poor” families making $82,600, 90% of whom already have insurance. They also fail to mention the crowd-out effect which means millions will lose their insurance and we’ll spend $15 billion insuring less than a million kids. Give me $15,000 and I’ll insure more than one child. They also fail to point out that we need 20 million new smokers to pay for this.

    Oh, that liberal media! You know things are bad when the NYT’s reporting looks like a position paper from the Democratic party.

  • The Law of Unintended Consequences strikes again! Children’s programming is being gutted by a lack of sponsors since junk food advertising has been banned (because we all know that parents can’t stop their kids from eating junk food). The solution will be to force them to pay for educational TV.
  • The house has OK’d drug reimportation. This could be a good thing if it forces the drug companies to refuse to do business with socialist price-fixing countries. We are paying almost all the R&D costs of the drug companies. Let’s see if they have the balls to fight. Of course, most libs have the “kill the goose” option – fix prices in this country.
    • Sports

    Bonds on Bonds

    Congratulations to Bonds on passing Henry Aaron. And good on the fans of San Diego for not getting swallowed in the controversy. And shame on the commissioner for putting his hands in his pockets and issuing a press release that focused on steroids. Selig needs to make up his mind – is the steroid testing working or not?

    The press should be ashamed of themselves too. ESPN is running an article about how Bonds’ teammates are alleging steroid use (actually, they’ve now changed it to “teammate” singular since it’s only one guy).

    They guy in question is Brian Johnson, who was a teammate of Bonds’ in 1997-1998. Of course, “Game of Shadows” claims Bonds started using steroids in 1999. And Johnson doesn’t say anything substantive, just makes vauge references to “cloak-and-dagger” societies.

    But since he was a teammate of Bonds and says something about steroids, we can conclude that Bonds’ teammates are accusing him of steroid use.

    No matter what, Bonds is one of the greatest players in baseball history and it’s been a privelege to wach him. He is now the first man to hold the single-season and career homerun mark since Babe Ruth. I have no idea what kind of person he is. And I’m unwilling to judge him based on the word of a bunch of SMTs.

    In the meantime, Diamond Mind does a fascinating projection of what Aaron would have done today and conclude he would have hit about 11 more homers. Money quote:

    Perhaps the most significant feature of these results is that, halfway into his “sim” career, Aaron was 50 home runs behind his actual career pace. The reason is that the 1950s, when Aaron began his career, actually were more offensively-oriented than the 1980s, when Bonds began playing. Aaron begins making up the home run difference when his seasons from the 1960s, at which time pitching was more dominant, are shifted to the homer-happy 1990s. He finally passes his actual career total when his twilight 1970s seasons are shifted to the new millennium.

    …

    Aaron’s best real-life single-season HR total was 47 in 1971, which was replayed as 2001 in our simulations. It so happens that 2001 also was the season when Bonds broke the single-season record with 73 homers.

    Of course, they don’t realize that Bonds is evil and so anything they say is going to be denigrate and ignored. Why if Aaron played today, he’d have hit 2000 home runs!

    News

    Negativism

    A friend who rarely visits the blog did so yesterday to see what my take was on the Minnesota disaster since we both used to live there. She commented that my posting these days seems angry, almost to the point of tinfoil hattery.

    Fair enough. I guess when it comes to politics, I am a bit on the angry side. The last six years have been a revelation. I wish I could be like a Democrat and just be happy that the man in the White House has my favorite letter after his name, no matter what policies he engages in. But I just can’t.

    It’s a simple fact that I, like most conservative libertarians, am a man without a party. The two parties are fighting over whether we will have big government or really big government. I give you the SCHIP Helen Lovejoy program expansion.

    But I’m not an angry person. Most people who know me and talk to me on a daily basis would probably describe me as easy-going. The reason is that politics, while a large part of my blogging, is a very tiny part of my life. So for Friday, I’ll go through seven things that occupy lots of my time about which I am not angry at all.

  • Abby the Babby Two months ago, I became a dad. I don’t talk about her much here since she has her own blog. But she’s a fantastic baby – well-behaved and smart. At two months, she’s smiling at us, giggling in her sleep and becoming a little chatterbox. No matter what goes on, she keeps me sane.
  • Sports OK, steroid scandals. Yeah, bribed refs. OK, Mike Vick. But I still love it. My beloved Braves are looking better than they have in years and we’re in the midst of a dynamite baseball season. Baseball especially appeals to my penchant for numbers so I’m always a happy pig when it’s in season and Baseball Prospectus is uploading five or six articles a day.

    And football, college and pro, is just a month away, which means Sue will become a football widow on weekends (as well as baseball playoff widow on weekdays). I can’t wait

  • My Job My job situation is a bit precarious since I only have funding through February. But my enthusiasm for astronomy is stronger than it has been in years. I’ve gotten a number of good papers published in the last year and been part of some great collaborations. The reason I’m fighting to stay in — even though I could make a lot more money on the outside – is because I like my work. I like where I work and who I work with. And I intend to keep doing it as long as the money holds out.
  • Books I read about as voraciously as someone with a full time job and a video game addiction can. In the last few months, I’ve had the pleasure of reading The Wisdom of Crowds, Harry Potter 7, Blue at the Mizzen, Seeing in the Dark, 1001 Movies You Must See Before You Die, Bluebeard, Team of Rivals and Imposter.
  • Movies Ah, netflix. Even when there’s a bad year at the movies, I can dig up the classics I haven’t seen. Last year was better than 2005 and I still think this year will be better than 2006. At least once a month, I see a movie that I love. And I’ve got a vast library of DVDs to fall back on.
  • Writing. Babbies, work and other things have minimized my fiction writing lately. But the stories are still alive. And I write content – often anonymously – for a lot of non-political websites.
  • The Future As much as cynicism pervades my view of politics, I am extremely optimistic about the future. When Abby was born, I recorded a video message for her to watch on her 18th birthday. One of things I told her was that we live in a great time and place and not to let, in Limbaugh’s words, the nattering nabobs of negativity get her down.

    We often don’t see this. Progress is invisible; problems looms large. We always see the present through blood-colored glasses. But just to focus on one issue, look at the environment. Yes, global warming is a concern. But when I was born, you couldn’t breath the air of LA, Lake Erie was dead, acid rain was growing and cars and industry were spewing filth. Today, lead is banned, rivers are cleaner, Lake Erie is palatable, the population bomb failed to explode, food is so plentiful obesity is becoming a global problem, cars run clean, trees are more numerous in America than in recorded history, acid rain has declined.

    Global warming is just about the only environmental concern left. Well, there are worries about overfishing and rain forests. But a lot of these are overblown or will be handled.

    I have immense faith in humanity. I know that we will solve the problems that are presented to us and move forward. Obstructive, interfering, ideology-addled government can only slow things down. Human progress is a force far too powerful for the idiots to hold back. Even if our civilization were to collapse, we would pick up the pieces and be back on our feet in a scant few centuries.

    I know that humans will ony day stretch out to the stars (notice, I didn’t say Americans), that AIDS will be cured, disease conquered, poverty eradicated. We’ve already come so far – the lifestyle we enjoy is something that could not have been imagined 100 years ago. And a hundred years from now people will forget about the problems we solved and get bent out of shape because nuclear fusion is making all our voices squeak and those aliens from Alpha Centauri are taking our jobs.

    • So there it is, my Friday dose of optimism. Tomorrow I’ll be back to my comfortable curmudgeonly ways.

    Politics, War on Terror

    WWII. NO!

    Another shitwit conservative tries to tell us Iraq=WWII because apparently they haven’t gotten the memo that we’re dealing with an internecine guerilla war, not a conventional one. But their comparison unintentionally makes the case against the President:

    But during those months Churchill had been busy firing or re-assigning the generals who were not bringing victories: including Gens. Wavell, Dill, Auchinleck, Ritchie, Norrie, Brooke-Popham, Messervy and Corbett — among others.

    Finally he found a general who could win — Bernard Law Montgomery.

    Funny how Churchill (and Lincoln) didn’t need to wait until they lost an election to realize they had the wrong guys in charge.

    I wonder whether, perhaps, in Gen. Petraeus President Bush has finally found his Gen. Montgomery. And whether Petraeus’s new strategy and success at beating al Qaeda in Iraq and growing success against the Mahdi Army — may be his El Alamein.

    Look, Petraeus is fantastic. If we’d had him in charge earlier, things might have gone differently. But I’m becoming concerned about the messianic attitude the Right has adopted toward him. He is not a miracle worker; he’s a good general. He and Gates are a vast improvement over the last pair of buffoons. But the surgery may be coming too late to save the patient.

    To build on Blankley’s anology, this would be like Churchill switching to Montgomery after the Nazis were in London – after insisting for years that all was well. But now I’m buying into this Iraq=WW2 bullshit.

    Of course, there are vast differences between WWII and the current Iraq Theatre of the War on Terror (ITWOT).

    Gee, ya think?

    For one thing, in 1942, the British Parliamentarians were not proposing bringing the British troops home and surrendering to Hitler and the Japanese. They merely thought another leader (perhaps Sir Stafford Cripps) might better lead Britain to victory.

    Yes. This is the only difference. Iraq is a globe-spanning superpower with massive industrial might fighting a conventional war. If we leave now, Iraqi troops will be in Cleveland by 2009.

    Were they more patriotic than the current defeatists in Washington? Perhaps. Or perhaps it was just that they understood (at least by that terrible summer of 1942) that for England, it was victory or death — while for many of the Washington defeatists in this dismal summer of ’07 they are under the delusion that America in all its might and glory can simply surrender to al Qaeda without potentially mortal consequences.

    To quote Robert, jumping Jesus on a pogo stick, is this guy serious?! Is he mental? Does he not realize that Al Quaeda is only one of the factions in Iraq — one that didn’t exist until we went there? Does he really think Iraq sliding into chaos is going to be the same as Nazi marching in Trafalgar Square? Or that our getting out of a civil war is the equivalent of “surrender”?

    Look, you can make the argument we need to win Iraq. You can make the argument that we can win in Iraq. But you need to lay the World War II comparisons aside. History did not begin in 1939 and end in 1945. There are thousands of historical comparisons that are better here. Just off the top of my head, I could say better comparisons might be Vietnam or Korea; the Occupation of Haiti; numerous British occupations including Afghanistan; our recent experience in the Balkans; various Roman occupations; maybe even the Greek invasion of Sicily.

    None of these comparisons are very good, but they are far more accurate than World War II. The problem is that the “conservatives” see everything in terms of World War II. Good vs. evil instead of good vs. evil vs. evil vs. evil. A straight-forward conflict instead of a non-linear ethnic strife. A villain with distinct facial hair instead of many villains with different agendas. And, to be honest, they’re mostly thinking in terms of movies and TV shows instead of history. (Remember the “lessons” of 24?)

    And if we are going to go with the World War II analogy, Bush is closer to Chamberlain than to Churchill. Churchill said he had nothing to offer but blood toil tears and sweat; Bush tells us all is well and offers us tax breaks. Churchill changed commanders when they lost; Bush stuck with Rummy until he lost an election. Churchill knew he needed to get the hell out of Dunkirk; Bush would say this was surrendering to the enemy. Churchill acknowledged bad news and was honest with the British public, whose resolved he trust; Bush thinks Americans are a bunch of weak-kneed morons and constantly insists that the only thing going wrong in Iraq is that we have Democrats and a media at home.

    Bush isn’t even in the same league as Churchill. He’s not even in the same God-damn sport. I’m not even certain he’s the same species.

    Again, there are some Dems who would love for us to lose in Iraq for political reasons, sure. But most of the people opposing our continuing presence are genuinely concerned that we are throwing lives and treasure into an unwinnable situation. Fuck the historical analogies – let’s deal with the situation we have in the present.