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AUGUST 11,  2011

THE DEBATE – AT 11:25 P.M. ET:  The Iowa debate is over.  Here are my reactions:

It's hard to say, with so many candidates up there, that anyone "won."  You know what happens with these debates – your eyes glaze over after 45 minutes, especially when the number of participants gets beyond two or three.  However, I think that Mitt Romney came out somewhat ahead, overall.  He didn't whip up much enthusiasm – he never does – but no one else weakened him by their attacks.  For a presumed frontrunner, even a tenuous one, that's a plus.

Michele Bachmann turned in her usual good performance, but it wasn't as much of a standout job as she did in the first debate, in New Hampshire.  Didn't hurt herself, didn't help herself.

Tim Pawlenty tried to create traction by taking on Bachmann, but it just made him look smaller.  She is an excellent debater who parried his attacks smoothly.

Newt Gingrich came off as the most knowledgeable candidate on the platform, and the clearest thinker.  But he's a voice from the past, and not all that likeable.  I don't really think he has a chance, although he is always educational.

This was Jon Huntsman's first time out debating the other candidates.  He is the former governor of Utah, and held his own, but didn't stand out.  For a while he reminded me of the late comedian, Don Knotts, somewhat nervous and on edge.

Rick Santorum has no chance, and neither does Herman Cain.  But I must say that both were articulate and forceful.

Ron Paul, who had his usual claque in the audience, is a nutbag whose foreign policy is indistinguishable from that of Code Pink.  He's an isolationist and anti-defense "libertarian" (not really) who'd take us back to the policies of the 1930s.  He's the kind of a guy who would have rooted for the Japanese at Pearl Harbor, and I wish the men in white suits would cart him away.

The man who wasn't there was Rick Perry, whose name hung over the place like a low-flying cloud.  He enters the race on Saturday, and he will have to show up for the next debate in September.  Sarah Palin and Rudy Giuliani also weren't there, but their names are not generating the kind of buzz that Perry's generates.

So, on balance, not much changed.  Romney came off well enough to stay the tentative frontrunner.  Michele certainly stayed near the top.  The others, except for Paul, were respectable. 

The Iowa straw poll is Saturday.  Perry and Palin will be in the state over the weekend.  A lot of politics.  We'll be covering.

August 11, 2011        Permalink 

SHORT TAKES ON THE DRIFTING WRECKAGE - AT 8:45 P.M. ET:

GAME ON – The Republican debate from Iowa begins in just a few minutes, carried on Fox.  The big name is the one who won't be there, Rick Perry, who announces on Saturday.  And the big question is whether Perry will destroy Mitt Romney, supposedly the frontrunner, but a frontrunner who arouses very little real enthusiasm, and who seems coy about addressing controversial issues.  (One pundit says that he's been in the Mittless Protection Program.)  We'll be back after the debate with some deep and brilliant observations.

ANOTHER GAME, OR RACKET – The Dow soared 423 points today, after dropping more than 500 yesterday, after soaring more than 400 the day before, after dropping more than 600 the day before that.  This, I guess, is what they call "investment."  No it isn't.  I always laugh when the financial "analysts" refer to "investors," or, as we call them in New York, "investuhs."  These aren't investors.  These are players, gamblers.  I've quoted this before, but Felix Rohatyn, one of the true statesmen of Wall Street, once called the stock market a casino, and that's what it is.  The market is always "reacting" to some late piece of news, without contemplating how this news fits in with other news.  Today the market was presumably "reacting" to higher corporate profits and a marginally acceptable unemployment figure.  Tomorrow it will "react" to something else.  Eventually, these men might grow up.

IMPORTANT SOCIAL NEWS – There is now a major petition campaign underway to have the children's TV show, "Sesame Street," permit Bert and Ernie to have a gay marriage.  I am not kidding.  I am not making this up.  When my kids were young we gave them Bert and Ernie dolls.  Little did we know it would come to this.  (Bert and Ernie must now be in their 40s.  Maybe it's time to settle down.)  I suspect that "Sesame Street" will succumb, and that we'll see a wedding.  I wonder who the Best Puppet will be. 

THE COOKIE CRUMBLES – But the polar ice doesn't.  Remember that story, back in mid-decade, that polar bears were dying because polar ice was melting?  Well, now there's a federal investigation, conducted by the Interior Department, is underway to determine whether that story was true or not.  The two scientists who wrote the original report are being questioned.  It's important because the "polar bear" issue was one of those highly charged stories that fueled the climate-change scare.  It was used, natch, by Al Gore in "An Inconvenient Truth."  Like other scientific "truths," it's now being questioned.  Stand by.

August 11, 2011       Permalink

DOW OPENS HIGHER, THEN EASES – AT 9:59 A.M. ET:  The Dow rose as much as 150 points over yesterday's close in early trading today, but then eased back and is now about even.  At the same time, America got some further grim economic news.  From Bloomberg:

The U.S. trade deficit unexpectedly increased in June to the highest level since October 2008 as a slump in exports exceeded a decline in shipments from overseas.

The gap widened 4.4 percent to $53.1 billion from $50.8 billion in the prior month, Commerce Department figures showed today in Washington. The deficit exceeded all estimates in a Bloomberg News survey of economists in which the median was $48 billion. Exports declined the most since January 2009.

U.S. shipments of capital equipment and industrial supplies fell in June, which may reflect the start of a cooling in the global economy. Some companies like Caterpillar Inc. (CAT) remain optimistic that demand for American-made goods will be sustained, helped in part by a weaker dollar.

“Sluggish U.S. demand growth this year has restrained imports,” Mike Englund, chief economist at Action Economics LLC in Boulder, Colorado, said before the report. “The export trajectory remains respectable.”

COMMENT:  It's pretty clear that we are in an economic position that may last for years, dimming the hopes of the post-9/11 generation.  The issues are worldwide, and there are even weaknesses starting to show in Asia. 

One of the things we must stand guard against right now is the inevitable bad ideas that will come down the pike, especially from social ideologists, aided by their disciples in journalism.  Get out your nonsense meters – stronger terms can be used – and insert the AA batteries.

August 11, 2011       Permalink

RUMBLE IN IOWA TONIGHT – AT 9:07 A.M. ET:  There will be a major televised debate among GOP presidential contenders tonight in Iowa, sponsored by Fox News and the Washington Examiner.  Check your local Fox News listing.

Neither Rick Perry nor Sarah Palin will be in the debate, but all the other majors will be.  Watch to see if Tim Pawlenty, who has shown some traction in Iowa in recent days, can improve his standing.  Watch to see if Michele Bachmann can repeat her stellar performance at the first debate, many weeks ago, in New Hampshire.

After the debate, the real Iowa fun begins.  Sarah Palin rolls into the state, and Rick Perry arrives over the weekend.  The Ames straw poll is Saturday. 

Iowa won't determine the nominee, and the Iowa caucuses, which actually decide convention delegate strength, won't be held until winter, but Iowa can send some weak contenders packing, and identify who is coming to the head of the pack.  I recommend you watch tonight.

In related political news, a new Fox poll has bad news for Barack Obama, and some tentative good news for Mitt Romney:

More American voters disapprove than approve of the job President Obama is doing. Likewise, if making a choice today, more voters say they would back someone else for president in 2012 than say they would give Obama a second term. Who would that someone else be?

Former Massachusetts Gov. Mitt Romney remains Republican primary voters’ preferred candidate. He’s also the GOP contender more voters see as likely to do a good job in the White House.

Currently 42 percent of voters approve of Obama’s job performance and 48 percent disapprove. Last month, before the agreement on the nation’s debt limit was finalized, 45 percent approved and 46 percent disapproved (July 17-19, 2011).

The drag on the president’s rating these days is not only lower approval among Democrats, which currently stands at 77 percent, but also a record-low 31 percent approval among independents. Approval among Republicans is 6 percent -- matching a previous record-low in October 2010.

Meanwhile, for the first time, the poll shows a 51-percent majority of voters think Obama is not a strong and decisive leader.

COMMENT:  Meanwhile, the president is scheduled to go on another vacation.  If I had numbers like that, I'd get out of town, too.

August 11, 2011       Permalink

WHILE OUR EYES ARE ELSEWHERE – AT 8:51 A.M. ET:  We've warned that one effect of our economic crisis is that it causes us to avert our eyes from foreign threats.  The same thing happened during the Great Depression of the 1930s.  Those foreign threats will not go away now, any more than they did then.  From The Wall Street Journal:

BEIJING—China sent its first aircraft carrier to sea, a defining moment in its effort to become a top-tier naval power that seeks to challenge U.S. military supremacy in Asia and protect Chinese economic interests that now span the globe.

The carrier, based on an empty hull bought from Ukraine, sounded its horn three times as it plowed through fog around the northeastern port of Dalian early Wednesday to begin its first sea trials, according to a Twitter-like service by the state-run Xinhua news agency.

The vessel, nearly 1,000 feet long, is far from fully operational: It has a new engine, radar, guns and other equipment, but has limited combat potential without backup from other carriers and an array of support ships. For the moment, it will be used mainly for training personnel, especially fighter pilots who must learn to take off from and land on a moving deck.

And they will learn.  The Chinese are a hard-working intense people.  "Made in China," once unheard of, has now become a staple I.D. for American electronics. 

The vessel... sends a powerful message both to China's domestic audience, for whom a carrier has for decades been equated with national strength, and to the U.S. and its regional allies, many of whom are embroiled in territorial disputes with Beijing.

It is the most potent symbol yet of China's long-term desire to develop the power both to deny U.S. naval access to Asian waters and to protect its global economic interests, including shipping lanes in the Indian Ocean and oil sources in the Middle East.

COMMENT:  Please note that, as this is happening, the Democrats in this country want to slash the defense budget to dangerous levels.  Sadly, there are some on the fringe right who want to go along with that.

History doesn't repeat itself, but the psychology of history repeats itself.  We averted our eyes in the 1930s, and got a bullet right between them at Pearl Harbor.  Next time, unless we are vigilant, and led by wise leaders who will remind Americans of foreign danger, the bullet may be nuclear. 

August 11, 2011    Permalink

MONEY WORRIES – AT 8:37 A.M. ET:  The overnight financial numbers from Asian and European markets were in negative territory.  We await the opening bell on Wall Street to see if we'll get any relief from yesterday's bloodbath.

True, the stock market isn't the real economy, but it has a serious psychological effect on the country, and on American politics.

We also await the weekly unemployment report. 

Worries about the solvency of several major European countries, including France, Italy, and Spain, continue.  And the London riots, which many will interpret as reflecting economic and social stress, aren't helping the economic outlook.  Please remember that London hosts the 2012 summer Olympics.  A continuation of social unrest in the city, especially if it includes assaults on tourists, can have a devastating effect on Britain as it prepares for the games, and its place in the international TV spotlight.

Violence was substantially reduced in Britain last night, thanks to massively increased police presence.

UPDATE:  Claims for unemployment benefits decreased in the U.S.  From Bloomberg:

Claims for unemployment insurance payments in the U.S. unexpectedly fell last week to a four-month low, signaling the recent slowdown in payroll gains is due to a lack of hiring rather than more firings.

Applications for jobless benefits decreased 7,000 in the week ended Aug. 6 to 395,000, the fewest since early April, the Labor Department said today in Washington. Economists forecast 405,000 claims, according to the median estimate in a Bloomberg News survey. The number of people on unemployment benefit rolls and those getting extended payments also dropped.

COMMENT:  Good, but hardly encouraging.  Remember that this was the situation as of five days ago, and does not take account of the impact of the downgrading of U.S. credit.  Nor does it take account of the impact of this week's market drop.  I wouldn't see this as a significant trend.

August 11, 2011     Permalink

AUGUST 10,  2011

SHORT TAKES ON THE DRIFTING WRECKAGE – AT 10:52 P.M. ET:

ACTION, CAMERA, VOTE – There is much buzz in Washington over the extraordinary access apparently being given to SONY Pictures and Oscar-winning director Kathryn Bigelow ("The Hurt Locker"), who will be doing a movie about the killing of Osama bin Laden.  The causes of the buzz:  1) Both SONY and Bigelow were big backers of Obama in 2008; 2) the film is scheduled to be released in October of next year, less than a month before the presidential election.  Republican Congressman Peter King of New York is asking for an investigation into the arrangements between Hollywood and the White House.  He is correct.  There is something not right here.  I've seen plenty of great war films, and not one glorified a president or was timed for release right before an election.  It was the troops who got the attention.  You'd think there'd be some common decency.

SARAH'S TRAVELS – Well, what do you know?  Guess where Sarah Palin is taking her national bus tour this week.  Would you believe...Iowa?  Correct.  Although she's not participating in tomorrow night's big GOP debate in Iowa, or in the Iowa straw poll on Saturday, she will be visiting the state, as will Governor Rick Perry of Texas.  It is theorized that Perry is visiting to steal the thunder of whoever wins the straw poll.  Question:  Will Sarah in turn steal Perry's thunder?  Don't underestimate her.  She still hasn't announced her presidential plans, but I doubt if she's visiting Iowa in a sweltering summer just to watch corn grow.

OH, THE SENSE OF REVENGE – Arthur Laffer, one of the architects of supply-side economics, and one of the economists behind the Reagan economic program, reveals that he was contacted by the White House in the spring and was asked to have a conversation with Obama adviser Austen Goolsbee.  Gee, you don't think the White House is having doubts about the Obama economic plan, do you?  Oh, wait.  What Obama economic plan?  I'll try to Google it.  Clearly, this president is in serious trouble, and asking the advice of the Reagan group is one of the smarter things we've seen recently.  I doubt if the advice will be taken, though.

A FINE ROMANCE – When Rick Perry announces his candidacy this Saturday, one interested party will be former Mayor Rudy Giuliani of New York.  It turns out, as reported in a superbly done piece on NRO, that Perry and Giuliani – an odd couple – have a mutual admiration society that goes way back, and have helped each other politically.  Although Perry is a strict conservative, and Rudy a moderate "New York conservative," the two get along famously.  I'd guess that if Perry gets in, Rudy will stay out.  I can't see a Perry/Rudy ticket because Perry's needs lie elsewhere, but I can see Rudy as head of the FBI, or even attorney general.

August 10, 2011       Permalink

BULLETIN – WALL STREET PRODUCING EGGS AGAIN – AT 4:18 P.M. ET:   The headline in Variety, the bible of show business, right after the 1929 stock market crash was "Wall Street Lays an Egg." 

Apparently, the street is in the egg-producing business again.  The Dow closed down about 520 points today, wiping out yesterday's gains and adding to a string of losses.  What we're seeing, according to most analysts we've consulted in the last hour, is fear, especially fear of a financial collapse in Europe.

We actually see the phenomenon of European politicians cutting short their traditional August vacations to get back to work.  At the same time, President Obama has apparently scheduled another vacation for himself. 

The trend is down.  The only way out of this is economic growth, and no one in power in Washington seems to know how to go about that.

August 10, 2011       Permalink

BULLETIN – STOCKS SLIDE DRAMATICALLY – AT 10:16 A.M. ET:  Yesterday's rally, which was probably just some bargain hunting, is history.  Things are not good on Wall Street this morning.  From Bloomberg:

U.S. stocks tumbled, erasing more than half of yesterday’s rally, while European shares slid and Treasuries rose for a third day amid concern the economic recovery is faltering and the debt crisis is spreading to France. The euro weakened against 11 of 16 major peers, dropping 1.1 percent to $1.4220.

At this hour the Dow is down 324 points.

Some economists are warning that the debt crisis in Europe, which has spread to Italy and Spain, and now threatens France, is far more important than the downgrading of American credit by one ratings agency.  Europe has thus far not solved its debt crisis, in part because the European public continues to demand high social spending.

If Europe fails, it could make this last week look like prosperity.

August 10, 2011       Permalink

MOST DEMS OPPOSE PRIMARY CHALLENGE TO THE ONE – AT 9:36 A.M. ET:  There does not appear to be a major revolution brewing in the Democratic Party, despite the apparent nostalgia for the days of George McGovern.  From The Hill:

Most Democrats don't wish to see President Obama face a primary challenge in 2012, according to a new poll released Wednesday.

Despite frustration among liberals that the president has ceded too much ground to congressional Republicans on the debt ceiling and other major issues, just 32 percent of Democrats and Democratic-leaning independents wish to see a primary challenge to the president.

Fifty-nine percent of Democrats said they would not wish to see a challenge to Obama, according to a Pew Research Center/Washington Post poll conducted after the recent debt-ceiling deal. The president agreed to a compromise debt bill that included only spending cuts and none of the revenue increases on which he had insisted.

Sen. Bernie Sanders (I-Vt.), a liberal stalwart, suggested at the height of the battle in Congress over that deal that a primary to Obama would be a "good thing." Consumer activist Ralph Nader has said he's recruiting candidates to run against Obama in different key primary states.

But even self-described liberals aren't much different in thinking Obama deserves a primary challenge. Thirty-three percent of liberals support a primary challenge to the president, while 62 percent oppose such a maneuver.

COMMENT:  Now, of course those aren't spectacular numbers for the president.  When only 59% of your party opposes a primary challenge, you aren't feeling much love. 

But the fact is that most Dems, while wrong, aren't nuts, and don't want Obama destroyed by some fringe candidate like former Senator Mike Gravel of Alaska, who says he'll run against Obama if he could raise a million dollars.  Oh, Gravel also said that he thought former hard-left Georgia Congresswoman Cynthia McKinney, an anti-American hatemonger, would make a fine candidate as well. 

Some politicians should be required to present a psychiatrist's certificate of good health before being allowed to open their mouths.

August 10, 2011       Permalink

QUOTE OF THE DAY – AT 8:37 A.M. ET:   From Bret Stephens, writing in The Wall Street Journal:

Much of the media has spent the past decade obsessing about the malapropisms of George W. Bush, the ignorance of Sarah Palin, and perhaps soon the stupidity of Rick Perry. Nothing is so typical of middling minds than to harp on the intellectual deficiencies of the slightly less smart and considerably more successful.

But it takes actual smarts to understand that glibness and self-belief are not sufficient proof of genuine intelligence. Stupid is as stupid does, said the great philosopher Forrest Gump. The presidency of Barack Obama is a case study in stupid does.

COMMENT:  Agreed.  We have a tendency to confuse academic intelligence with wisdom.  The two are not the same.  I have great respect for true scholarship and great teaching.  But the president does things.  He doesn't simply contemplate things.  And this president's ability to do things is, to put it mildly, under question. 

He comes from a world where people dream of putting their College Board scores on their gravestones.

He seems to have little understanding of how the real world operates, having rarely lived in that world.  He believes that by speaking well he can do well and move mountains.  He cannot.  He seems to have contempt for the very acts of politics, compromise and vote counting that allow great things to be accomplished.  He does not understand what a leader does, having never been one before.

Maybe the next time we choose a president we should bar one question from being asked of candidates:  Where did you go to school?

August 10, 2011       Permalink

TOUGH TALK IN LONDON – AT 8:21 A.M. ET:  British Prime Minister David Cameron recently said that multiculturalism had failed, a remark that shocked the prissies in Europe and in British universities, but of course he was right. 

Now Cameron is talking tough again, and properly so, saying things that have needed to be said in a nation that is really two nations – the Britain of Churchill and the Britain of the chic left.  Britain has been stunned by three nights of rioting that began in London and spread to other cities.  From The Telegraph:

David Cameron has given the green light for water cannon to be used on the British mainland for the first time and condemned pockets of society as “sick.”

The Prime Minister said water cannon – until now only ever seen in the UK in Ulster - will be available at 24 hours notice to deal with the “despicable violence” being carried out in cities across the country.

And in a sign that other more draconian crowd control measures will now be at the disposal of the police he said: “We will do whatever is necessary. Nothing is off the table.”

In his strongest comments yet on the perpetrators of the violence, Mr Cameron said: “There are pockets of our society that are not only broken, but frankly sick...It is a complete lack of responsibility in parts of our society, people allowed to feel that the world owes them something.”

Water cannon have been used this summer by police in Ulster and have been a regular sight at disturbances in the province. But despite calls for it to be used on the mainland – including after last year’s student riots in London – ministers have always ruled it out.

COMMENT:  Cameron still has a tough job ahead in countering the cultural forces on the left.  The BBC reverted to leftist form during the riots by referring to people who were beating other people as "protesters."  Some British fringe leftists have openly praised the rioting.  We have a similar political element here, of course. 

We hope these horrible riots, during which whole sections have been set on fire, will jolt the British people into a realistic view of what is happening in their society, despite the efforts of the BBC and other outlets to present their own "narrative." 

A suggestion floating around is for Bill Bratton, who revolutionized policing in New York under Mayor Rudy Giuliani, to to become the next head of Scotland Yard.  It's a great idea that could modernize policing in Britain, but apparently it won't happen.  Too much political opposition.

After all, why get the best when another bureaucrat can be brought in?

August 10, 2011        Permalink

ON WISCONSIN – AT 8:04 A.M. ET:  After an effort that dwarfed the Normandy invasion, the Democrats failed to win control of the Wisconsin legislature in yesterday's recall election.  There is pain, there is agony, on the left, but Obamacare health providers and spiritual advisers stand ready.  From the Wisconsin State Journal:

After tens of millions of dollars spent by outside interest groups, dozens of attack ads and exhaustive get-out-the-vote efforts, Democrats on Tuesday fell short of their goal of taking control of the state Senate and stopping the agenda of Gov. Scott Walker.

Republicans won four of six recall races, meaning the party still holds a narrow 17-16 majority in the Senate — at least until next week, when Sens. Robert Wirch, D-Pleasant Prairie, and Jim Holperin, D-Conover face their own recall elections. A third Democrat, Sen. Dave Hansen, D-Green Bay, easily survived a recall attempt last month.

Sens. Robert Cowles, R-Green Bay, Sheila Harsdorf, R-River Falls, Luther Olsen, R-Ripon, and Alberta Darling, R-River Hills, successfully defended their seats Tuesday.

Challengers state Rep. Jennifer Shilling, D-La Crosse, and Jessica King unseated incumbent state Sens. Dan Kapanke, R-La Crosse, and Randy Hopper, R-Fond du Lac.

Going into Tuesday, Republicans controlled the body 19-14, so Democrats needed to win at least three seats and hold onto two more next week to take over.

"The revolution has not occurred," said UW-Milwaukee political science professor Mordecai Lee, a former Democratic lawmaker. "The proletariat did not take over the streets."

Huh?  You mean people still talk that way?  The proletariat?  Have they sighted Lenin coming in on a train? 

This is good news because of the enormous effort, backed, as the story points out, by well-financed outside groups, to reverse control of the Wisconsin Senate. 

Maybe, just maybe, with the right presidential candidate Wisconsin can be flipped into our column next year. 

August 10, 2011     Permalink