Libertarian Leanings

The Applause Is Over

According to Fouad Ajami, professor at Johns Hopkins School of Advanced International Studies, Arab applause for Obama is over, and it's his own fault.

On Nov. 4, on the 30th anniversary of the seizure of the American embassy in Tehran, the embattled reformers, again in the streets, posed an embarrassing dilemma for American diplomacy: "Obama, Obama, you are either with us or with them," they chanted. By not responding to these cries and continuing to "engage" Tehran's murderous regime, his choice was made clear. It wasn't one of American diplomacy's finest moments.

Climate Change -- Criminal Investigation Sought In UK

In the James Corbett interview below, Lord Monckton discusses his request for a criminal investigation of those climate scientists who have not only refused British Freedom of Information requests, but may also have conspired to destroy data subject to them.

By way of the Libertarian Republican.

Campaign 2004 -- It Ain't Over

Flashback: Kerry-Edwards, Campaign 2004

It is Sunday, November 21, 2004.  Senator John Kerry, Democrat from Massachusetts, waits with his wife Teresa Heinz Kerry, actors Robin Williams and Morgan Freeman and comedian Chris Tucker for the procession to begin at the formal opening of the Clinton Presidential Library in Little Rock, Ark.  Less than three weeks earlier the senator had suffered a most humiliating electoral defeat at the hands of incumbent President George W. Bush.  FOX News correspondent Geraldo Rivera offers a sympathetic word.

"Tough luck, senator," Rivera said to Kerry, referring to the Democrat's election loss.

Trying to recount Kerry's words verbatim, Rivera said Kerry responded by saying:

"It was that Usama tape — it scared them [the American people]."

Rivera said Kerry said the tape came out too late for his camp to rebut and the Democratic campaign couldn't counteract it in time for the Tuesday election.

"Sen. Kerry clearly believes not only is it the security issue that cost him the election, but very specifically the Usama tapes coming out in the 11th hour," Rivera reported Friday.

Kerry also acknowledged that the security issue in general hurt him in the race, Rivera said.

The broadcast of the tape from the Al Qaeda leader jolted the campaign's closing days, accentuating the terrorism theme with a reminder of the Sept. 11, 2001, attacks.

In the tape, aired by the Arab television network Al-Jazeera, bin Laden spoke directly to the American people. He admitted for the first time that he carried out the Sept. 11 attacks and said the attacks would have been less severe if Bush had been more alert.

He promised to lay out "the best way to avoid another Manhattan" and told Americans, "Your security is not in the hands of Kerry or Bush or Al Qaeda. Your security is in your own hands."

The tape caused Kerry to revive his contention that Bush missed an opportunity to capture or kill bin Laden during the Afghan war. The Democratic challenger asserted throughout the campaign that U.S. forces could have run down bin Laden in the Tora Bora mountains in late 2001 if they had gone after him on the ground, and he blamed Bush for the decision to let Afghan forces lead that chase.  [My emphasis]

After five years and a week of pent up frustration, Senator Kerry finds vindication, thanks to the staff of the Democratic majority on the Senate Foreign Relations Committee.  And thanks to the committee chairman, too.  That would be Senator John Kerry, Democrat from Massachusetts. 

U.S. forces missed chance to get bin Laden: report
Sun Nov 29, 2009 6:29am EST

WASHINGTON (Reuters) - The U.S. military could have captured or killed Osama bin Laden in 2001 if it had launched a concerted attack on his hideout in Afghanistan, according to a report prepared for the Senate Foreign Relations Committee.

The report, written by staff working for the Democratic majority on the committee, said the al Qaeda leader's escape was a lost opportunity that altered the course of the war and paved the way for insurgencies in Afghanistan and in Pakistan.

[...]

The report was especially critical of military leaders under former President George W. Bush, including former Defense Secretary Donald Rumsfeld and his top military commander, retired General Tommy Franks.

Democratic Senator John Kerry, the chairman of the committee, has argued the Bush administration missed a chance to get bin Laden and his top lieutenants in Tora Bora just months after the September 11 attacks on the United States.

Kerry lost the 2004 presidential election to Bush.

Lest we are tempted to write this off as just so much in the way of sour grapes, consider the timing of the committee report.  It's release comes just two days ahead of President Obama's long, long, long awaited decision on General Stanley McChrystal's request for additional troops for the Afghan war.  The president will announce his decision on Tuesday in a prime-time speech from the U.S. Military Academy at West Point in New York.

Updated November 28, 2009
Obama Faces Tough Task in Outlining
Afghanistan Strategy, Experts Say

FOXNews.com
In his prime-time speech from the U.S. Military Academy at West Point in New York, Obama is expected to announce he's sending up to 35,000 more troops -- while trying to affirm he has found a clear path of success in a country known as the graveyard of empires President Obama said he intended to "finish the job" in Afghanistan. Now he has to say how.

It will be a tough sell.  But winning the war will be tougher, and no one can predict with absolute certainty what Obama will say until he says it.  But here's a guess:  He won't wait long to remind America and the world that he inherited this mess. 

Michael Crichton on Fundamentalist Environmentalism

In the video below the late Michael Crichton describes environmentalists as religious fundamentalists.  I'd say his analysis applies not just to environmentalists but to political leftists as well.  After all, Marxism and all other flavors of socialism have been proven time and again to be unworkable, not to mention harmful or even fatal to the people who live under it.  Leftists reveal an indestructible belief in the miraculous.  The decades of failure pile up into centuries, yet lefties insist that next time it's all going to work.  With the right progressive leadership Utopia will be at hand.

By way of the Belmont Club.

To Tax and Regulate

Paul Krugman is very weird or very dishonest, or maybe both.  Here is his latest, rather novel solution for... something:  Professor Krugman would like to tax financial transactions, even while admitting that it would not solve much. 

Would a Tobin tax solve all our problems? Of course not. But it could be part of the process of shrinking our bloated financial sector. On this, as on other issues, the Obama administration needs to free its mind from Wall Street’s thrall.

A better question for the professor to pose, would a Tobin tax solve any problem?  Apparently, only if you believe "our bloated financial sector" needs shrinking.  I'm not where I think any of our sectors, aside from government, need shrinking, and most certainly not our financial sector.

Besides, I thought Fanny and Freddie took care of our bloated financial sector by flooding the residential housing market market with easy money and bloating that market.  The implosion of that bubble didn't just cause a drop in housing prices.  As Krugman points out, "Losses in subprime and other assets triggered a banking crisis..."  The banking crisis to which the professor refers took a big enough chunk out of our financial sector to suit me.  Krugman, however, doesn't even nod in that direction.  He offers nothing to address the subprime and other asset losses that were behind it all.

To determine the cause of those particular losses we should look to University of Texas economics professor, Stan Liebowitz.

New Evidence on the Foreclosure Crisis
Zero money down, not subprime loans, led to the mortgage meltdown.

By STAN LIEBOWITZ
What is really behind the mushrooming rate of mortgage foreclosures since 2007?  The evidence from a huge national database containing millions of individual loans strongly suggests that the single most important factor is whether the homeowner has negative equity in a house -- that is, the balance of the mortgage is greater than the value of the house.  This means that most government policies being discussed to remedy woes in the housing market are misdirected.

It also means that Nobel Laureate Krugman is misguided (or maybe just deceitful) in his focus on Wall Street as the problem in most need of a regulatory cure.  Wall Street is, however, a place where taxes can be levied in a way that minimizes the political pain, so Krugman looks for an easy target.  Financial transactions are in his cross hairs.  Rather than address the cause of the underlying losses Professor Krugman would prefer to tinker with the system on the basis of Gordon and Metrick. 

The Gorton and Metric abstract (link to the abstract courtesy of Tom Maguire) is where we find this:

The Panic of 2007-2008 was a run on the sale and repurchase market (the “repo” market), which is a very large, short-term market that provides financing for a wide range of securitization activities and financial institutions. Repo transactions are collateralized, frequently with securitized bonds. We refer to the combination of securitization plus repo finance as “securitized banking”, and argue that these activities were at the nexus of the crisis. We use a novel data set that includes credit spreads for hundreds of securitized bonds to trace the path of crisis from subprime-housing related assets into markets that had no connection to housing. We find that changes in the “LIB-OIS” spread, a proxy for counterparty risk, was strongly correlated with changes in credit spreads and repo rates for securitized bonds. These changes implied higher uncertainty about bank solvency and lower values for repo collateral.  [My emphasis] 

Well yes, but it turns out the securitized bonds that were used as collateral were the ones that were said to be clogging up the credit markets -- mortgage backed securities in which the underlying mortgages were being foreclosed right and left.  You might expect the high rate of foreclosures would have a negative impact on value of the bonds, and that might cause some angst on the part of those who might be holding them as collateral.  Is it supposed to be a big surprise that interest rates are affected by risk?  What to do?

Here's an unoriginal thought:  We could change mortgage lending regulations so that home buyers would bring a bigger down payment to the table when they buy a house.  This would do two things.  First it would put a tighter limit on the amount of money going into the home buying market.  Second, the higher down payment would provide a cushion for the buyer in the event of a fall in housing prices, reducing the chance of foreclosure.

If you protect the original mortgage investment you protect the mortgage backed securities.

But no.  Professor Krugman wants to tax repo transactions.  Apparently Krugman thinks repo transactions are "socially useless" activities, and so he would discourage them through taxation.  Lefties are such moral busybodies, aren't they.  Socially useless.  It boggles the mind.  But it doesn't fix anything.  And here I thought lefties were all about getting to root causes, but I guess that's true only if the fix involves some intrusive government regulation or a tax.

Update:  Peter J. Wallison, a senior fellow at the American Enterprise Institute, asks why AIG was bailed out, if it really wasn't too big to fail. 

Since last September, the government's case for bailing out AIG has rested on the notion that the company was too big to fail. If AIG hadn't been rescued, the argument goes, its credit default swap (CDS) obligations would have caused huge losses to its counterparties—and thus provoked a financial collapse.

Last week's news that this was not in fact the motive for AIG's rescue has implications that go well beyond the Obama administration's efforts to regulate CDSs and other derivatives. It's one more example that the administration may be using the financial crisis as a pretext to extend Washington's control of the financial sector.

Nor was it true that the financial crisis was precipitated by the predatory lending practices of mortgage lenders.  According to Mr. Wallison, it was government policies at the root of it.

No doubt some deceptive practices occurred in mortgage origination. But the facts suggest that the government's own housing policies—and not weak regulation—were the source of these bad loans.

[...]

The fact that the government itself either bought these bad loans or required them to be made shows that the most plausible explanation for the large number of subprime loans in our economy is not a lack of regulation at the mortgage origination level, but government-created demand for these loans.

On an optimistic note, the disclosure about credit default swaps and the AIG crisis may mean the push for greater regulation of the financial industry is running off the rails.

The Payoff

The Washington Times reports today that Blanche Lincoln and several other moderate Democrats will be getting a public relations boost from pro health care reform groups.

Ads add heat to health care debate
Advocacy groups target both sides of issue

By Jennifer Haberkorn

For weeks, Sen. Blanche Lincoln has been attacked as a "flip-flopper" or an obstructionist in television ads aimed at Arkansas voters, who will decide next year if she gets to keep her job.

This week, she and other moderate Democrats who made a politically risky vote to start debate on the Senate's health care bill may get a bit of positive support from two campaigns, funded by reform advocates, highlighting their votes to allow debate on the Democrats' bill.

It's a rarity among political ads, which tend to highlight the negative aspect of important votes, but they're just two in a slew of health-related television advertising and grass-roots campaigning expected between now and the end of the year, when the Senate plans to hold a vote on the bill.

Families USA and PhRMA, the pharmaceutical-industry trade group, are airing the ads in Arkansas this week with hopes of airing similar ads in the states of other "swing-vote" lawmakers.

PhRMA is a familiar name.  This is the industry group that made a back room deal at the White House first reported by the New York Times back in August.

Drug Industry to Run Ads Favoring White House Plan

By DAVID D. KIRKPATRICK
Published: August 8, 2009

WASHINGTON — The drug industry has authorized its lobbyists to spend as much as $150 million on television commercials supporting President Obama’s health care overhaul, beginning over the August Congressional recess, people briefed on the plans said Saturday.

The unusually large scale of the industry’s commitment to the cause helps explain some of a contentious back-and-forth playing out in recent days between the odd-couple allies over a deal that the White House struck with the industry in June to secure its support. The terms of the deal were not fully disclosed. Both sides had announced that the drug industry would contribute $80 billion over 10 years to the cost of the health care overhaul without spelling out the details.

We must be witnessing the Chicago government-industry cooperative model gone national.  Government threatens industry with heavy and costly regulation.  In hope of persuading government to impose a less burdensome regulatory framework, industry promises financial support for wildly unpopular legislation that will vastly increase the power and reach of government.  Government and industry coordinate what they hope will be an overpowering media campaign that will drown out opposition voices.

Eugene Robinson Fights the Good Fight For AGW

Renowned climate scientist Eugene Robinson reassures us that hacked data and emails from Climate Research Unit's computers are not evidence of global warming fraud.

Stop hyperventilating, all you climate-change deniers. The purloined e-mail correspondence published by skeptics last week -- portraying some leading climate researchers as petty, vindictive and tremendously eager to make their data fit accepted theories -- does not prove that global warming is a fraud.

If I'm wrong, somebody ought to tell the polar ice caps that they're free to stop melting.

Tell the polar ice caps they're free to stop melting?  The Aussies have already done that.

Ice core drilling in the fast ice off Australia's Davis Station in East Antarctica by the Antarctic Climate and Ecosystems Co-Operative Research Centre shows that last year, the ice had a maximum thickness of 1.89m, its densest in 10 years. The average thickness of the ice at Davis since the 1950s is 1.67m.

Climate Change Conspiracy

The scientific basis for global warming is looking shakier than ever now that a hacker has gotten into the computers of the Climatic Research Unit at the University of East Anglia, although it remains to be seen if the release of hacked emails and documents will have any appreciable impact on chances of an agreement coming out of the United Nations climate change conference in Copenhagen.

Last week an apparent hacker obtained access to their computers and published in the blogosphere part of their internal e-mail traffic. And the CRU has conceded that the at least some of the published e-mails are genuine.

Astonishingly, what appears, at least at first blush, to have emerged is that (a) the scientists have been manipulating the raw temperature figures to show a relentlessly rising global warming trend; (b) they have consistently refused outsiders access to the raw data; (c) the scientists have been trying to avoid freedom of information requests; and (d) they have been discussing ways to prevent papers by dissenting scientists being published in learned journals.

If you wish you may download those an archive of those hacked email, documents, and code here.

Summary

This archive presents over 120Mb of emails, documents, computer code and models from the Climatic Research Unit at the University of East Anglia, written between 1996 and 2009.

The CRU has told the BBC that the files were obtained by a computer hacker 3-4 days ago.

This archive includes unreleased global temperature analysis computer source code that has been the subject of Freedom of Information Act requests.

The archive appears to be a collection of information put together by the CRU prior to a FoI redaction process.

In the face of mounting evidence that the science of climate change is not really science, President Obama has once again put his prestige on the line by announcing plans to go to Copenhagen next month to take part in the global climate summit.

President Obama will travel to Copenhagen to attend an international conference on climate change, White House officials told Fox News. 

The president is expected to travel to the United Nations summit on Dec. 9.

There was some question as to whether Obama would attend. Congress has stalled on climate change legislation as it battles over health care, leaving the world body unlikely to reach a legally binding agreement at the summit, and instead aiming for political commitments.

The White House said earlier in the week that the United States will nevertheless propose an emissions reduction target in Copenhagen next month.

If the president's upcoming presentation is as convincing as the one he made on his last visit to Copenhagen, skeptics can take heart.  You may recall that Brazil won the Olympic sweepstakes that time.  But there is a difference this time, and we can't write off Obama's chances.  There is much more at stake, and there are more who stand  to profit from the ongoing study and regulation of CO2.

This is an enormous case of organized scientific fraud, but it is not just scientific fraud. It is also a criminal act. Suborned by billions of taxpayer dollars devoted to climate research, dozens of prominent scientists have established a criminal racket in which they seek government money-Phil Jones has raked in a total of £13.7 million in grants from the British government-which they then use to falsify data and defraud the taxpayers. It's the most insidious kind of fraud: a fraud in which the culprits are lauded as public heroes. Judging from this cache of e-mails, they even manage to tell themselves that their manipulation of the data is intended to protect a bigger truth and prevent it from being "confused" by inconvenient facts and uncontrolled criticism.  [My emphasis]

In fact you'd have to say climate change is very nearly a perfect scam.  If skeptics are correct, as I believe we are, nothing we do will have any impact on the earth's climate.  If global warmists prevail, as I fear they may, our inability to affect the climate will be given as proof of a continuing climate crisis which will demand more and more government dollars that will be channeled into a self-sustaining constituency that favors greater rather than less government control over out lives.  A mammoth partnership of government, industry, media, and academia will expand in size and power, soaking up more and more funding from increasingly powerless taxpayers.

Daytona Beach Thanksgiving

In case you're wondering whatever became of Libertarian Leanings, my apologies.  I've been on the road these last few days on my way from Nashua to Daytona Beach where I'll be having Thanksgiving dinner with two of my children.  I wish you will all a very happy Thanksgiving holiday.

Blogging will resume shortly.

Stimulating Health Care Support

If you're wondering why the stimulus hasn't even slowed our skyrocketing unemployment, the example of AARP offers a hint.

AARP, which has given its full-throated support to Democratic health care legislation even though seniors remain largely opposed, received an $18 million grant in the economic stimulus package for a job training program that has not created any jobs, according to the Obama administration's Recovery.gov website.

The job training, says AARP, helped 500 older workers find permanent jobs. Assuming AARP's claim is true, fact remains that the $18 million AARP received probably hasn't created any permanent new jobs.  Maybe it was able to employ a few new trainers, but the training most likely helped seniors to land existing jobs.  It's not as if this is a bad thing, but it's not as if the economy got an $18 million shot in the arm which would create permanent self-sustaining new jobs.

It's worth noting that AARP has a stake in the health care debate as a provider of Medigap insurance.  Medigap and Medicare Advantage are supplemental policies for shortfalls in Medicare coverage.  AARP sells Medigap.  As a way of reducing the cost of the health care reform, Democrats had planned to cut Medicare Advantage subsidies, which would reduce competition against AARP's Medigap.

I suspect the $18 million for AARP is emblematic of the rest of Obama's stimulus spending.  It's primary intent is to stimulate political support for Obama and his policies.  Job creation is the hoped for side effect.  It's not working out that way, though. 

Update:  The Wall Street Journal has a timely column in which Jeb Hensarling and Paul Ryan explain why nobody expects our economy to make a strong recovery very soon.

Virtually none of the stimulus spending was directed towards encouraging broad-based private investment, and thus failed to encourage true economic growth. An analysis by economists John F. Cogan, John B. Taylor and Volker Wieland, published on this page on Sept. 17, suggests that while the stimulus succeeded in temporarily and marginally increasing disposable personal income, it left personal consumption spending virtually unchanged.

[...]

Health care, the administration's signature issue, is Exhibit D. Disregarding its impact on quality and access, its plan will surely cost well over $1 trillion over the next decade. The House-passed version includes an 8% "pay or play" payroll tax and a half-trillion dollar surtax on incomes over $500,000, much of which will strike small business. Both taxes will tend to depress investment and the creation of new jobs.

And looming down the road is the proposed cap-and-tax legislation, which will cost taxpayers $800 billion.

Beyond instilling tremendous political uncertainty into economic decision-making, these policies ensure that deficits will shatter all previous records.

Forget prosperity.  It's time to start worrying about survival.

More:  Obama's health care bill is buying its own support.  

On page 432 of the Reid bill, there is a section increasing federal Medicaid subsidies for “certain states recovering from a major disaster.” 

The section spends two pages defining which “states” would qualify, saying, among other things, that it would be states that “during the preceding 7 fiscal years” have been declared a “major disaster area.” 

I am told the section applies to exactly one state:  Louisiana, the home of moderate Democrat Mary Landrieu, who has been playing hard to get on the health care bill.

In other words, the bill spends two pages describing would could be written with a single world:  Louisiana.  (This may also help explain why the bill is long.)

Senator Harry Reid, who drafted the bill, cannot pass it without the support of Louisiana’s Mary Landrieu.

How much does it cost?  According to the Congressional Budget Office: $100 million.

$100 million -- the cost of one senate vote.