I think we can all basically agree that Ron Paul is not really a Republican. It's quite obvious he is a mainstream Libertarian. But he's running as a Republican. The question is why?
My answer: He's milking the two-party system for visibility.
That's reasonable enough. But I'm starting to get curious about his end-game here.
Does he plan on running as an Independent once he loses the Republican nomination? Maybe. That could be a genius way to do it.
Does he plan on setting himself up for a future role in some other election year? Does he want to be vice president?
I think he's hedging his bets here, garnering visibility and support. He knows full damn well he's not winning the Republican nomination. But he'll be around when the dust settles, with a large base of support. We'll see if he can take advantage of it.
Age may become a question for him, though. How long does he have to wait? He's 75 now. Maybe this is his last gasp for fame and influence. And he'll take fame and influence if he can get it.
Wednesday, August 17, 2011
Our consumer-driven economy
I hear a lot of theories about what's wrong with our economy: Regulation. Taxes. Offshoring jobs. States cutting jobs to balance their own budgets as the federal government tries to stimulate, which offset into zero stimulus. Housing bubbles. Credit and financial crises that take a really long time to get over.
But it's none of that. Not really. The problem is that the consumer has been lied to by politicians for the past 30 years and they are now waking up to economic reality. And they DO NOT LIKE what they see.
This is what consumers are now facing, lit up in full view with stadium lights:
- Entitlements that they were planning on relying on are going to be cut back.
- Their nest eggs and net worth have been hurt and are going nowhere anytime soon. Stocks are down. Housing is down. And it looks like a long steady slow climb from here.
- Jobs are vanishing. Especially those good paying jobs with decent benefits.
- Their skills are increasingly out of date.
- Education is too expensive for what you get out of it.
- A career path that seems good today might blow up in your face tomorrow.
And this is the good result - if you haven't lost your job and still have savings in the bank.
So consumers have throttled back. This "retrenching" as some financial types call it may be permanent.
That's the problem. It's plain old reality kicking us all in the ass.
And now let's watch our politicians to see who has the wherewithal to deal with it. Because we're tired about being lied to. And I think they are all starting to realize it.
But it's none of that. Not really. The problem is that the consumer has been lied to by politicians for the past 30 years and they are now waking up to economic reality. And they DO NOT LIKE what they see.
This is what consumers are now facing, lit up in full view with stadium lights:
- Entitlements that they were planning on relying on are going to be cut back.
- Their nest eggs and net worth have been hurt and are going nowhere anytime soon. Stocks are down. Housing is down. And it looks like a long steady slow climb from here.
- Jobs are vanishing. Especially those good paying jobs with decent benefits.
- Their skills are increasingly out of date.
- Education is too expensive for what you get out of it.
- A career path that seems good today might blow up in your face tomorrow.
And this is the good result - if you haven't lost your job and still have savings in the bank.
So consumers have throttled back. This "retrenching" as some financial types call it may be permanent.
That's the problem. It's plain old reality kicking us all in the ass.
And now let's watch our politicians to see who has the wherewithal to deal with it. Because we're tired about being lied to. And I think they are all starting to realize it.
Sunday, August 14, 2011
Populism will destroy the GOP
When the American people wake up and realize that they've been supporting a Republican party that really stacks all the economic cards against most working people, what's going to happen then?
We now have Republicans split into two factions. The common people are gravitating toward the Tea Party movement. The mainstream Republican Party is now being found out as the protector of all corporate moneyed interests everywhere. Everything else they care about is just window dressing to keep people in line. The problem is that this policy of protecting the wealthy and big business is not trickling down to the rest of us. And it's becoming painfully obvious. It's not just liberals who understand this anymore.
The conservative social views that have helped hold together the Republicans will weaken as brutal economic facts sink in.
I predict the Republican Party is not going to survive this schism. You heard it here first. This next election should pretty much destroy what's left of a cohesive party.
We now have Republicans split into two factions. The common people are gravitating toward the Tea Party movement. The mainstream Republican Party is now being found out as the protector of all corporate moneyed interests everywhere. Everything else they care about is just window dressing to keep people in line. The problem is that this policy of protecting the wealthy and big business is not trickling down to the rest of us. And it's becoming painfully obvious. It's not just liberals who understand this anymore.
The conservative social views that have helped hold together the Republicans will weaken as brutal economic facts sink in.
I predict the Republican Party is not going to survive this schism. You heard it here first. This next election should pretty much destroy what's left of a cohesive party.
Saturday, August 13, 2011
Democrats
I never talk about Democrats in this blog, and I think that's because they bore me. But I've seen questions about their lack of fire in the belly. Why don't they have a backbone? Why don't they stand up for what they believe?
There are several possible explanations here that come to mind:
- They think the American center is not on their side. And they think they are the only game in town for the American left.
- They are being patient while the GOP plays out its cards. They are waiting for the inevitable backlash against Republicans. The Democrats will be seen as the more responsible alternative.
- They don't have a good long-term solution to the country's problems.
So I don't blame them for staying silent. What are they going to say that helps their case?
There are several possible explanations here that come to mind:
- They think the American center is not on their side. And they think they are the only game in town for the American left.
- They are being patient while the GOP plays out its cards. They are waiting for the inevitable backlash against Republicans. The Democrats will be seen as the more responsible alternative.
- They don't have a good long-term solution to the country's problems.
So I don't blame them for staying silent. What are they going to say that helps their case?
Friday, August 12, 2011
Final debate post
Huntsman: Much more ehhh. I think he'll have a likeability issue.
Bachmann: Keeps things interesting. She has star power. Not that I'll vote for her. She has a warm side as she makes her points quite clearly and forcefully.
Cain: Glad he's in the race.
Romney: Can you stop speaking now so that I don't have to listen to you?
I'm watching this on a re-run. I thought I saw that Romney came out OK in this debate from early commentary. Huh?
Newt: Becoming less likeable as the evening goes on. Each time he speaks I like him less. Now he's getting angry. His face is turning red. And he likes to lecture. I like him best as a thrower of Republican bombs into the idea mix. He can't succeed as a candidate.
Huntsman: Please stop. I barely know you and I already can't stand you.
Pawlenty: I think he's doing OK here. I'm not entirely sure he looks presidential. But that's possibly over-rated. Important and necessary, but over-rated.
Ron Paul: I have a hard time thinking he'll be embraced by the heart and soul of the Republican Party.
Bachmann: Keeps things interesting. She has star power. Not that I'll vote for her. She has a warm side as she makes her points quite clearly and forcefully.
Cain: Glad he's in the race.
Romney: Can you stop speaking now so that I don't have to listen to you?
I'm watching this on a re-run. I thought I saw that Romney came out OK in this debate from early commentary. Huh?
Newt: Becoming less likeable as the evening goes on. Each time he speaks I like him less. Now he's getting angry. His face is turning red. And he likes to lecture. I like him best as a thrower of Republican bombs into the idea mix. He can't succeed as a candidate.
Huntsman: Please stop. I barely know you and I already can't stand you.
Pawlenty: I think he's doing OK here. I'm not entirely sure he looks presidential. But that's possibly over-rated. Important and necessary, but over-rated.
Ron Paul: I have a hard time thinking he'll be embraced by the heart and soul of the Republican Party.
GOP debate progress
Found Rick Santorum. Figured out who he reminds me of: Joel Osteen. Just not quite as sweet. He's not turning me off or wowing me. But I'll put him on my list of needing to know more. But I feel he's earnest and believes what he says.
Pawlenty: Mixing it up with a variety of folks. He's trying to establish himself in this campaign right now.
Romney: Still annoying me. He is a really bad campaigner. But he has good moments and bad. Sometimes he believes what he says and it comes out better.
Bachmann: Has moments of likeability, especially while she's actually speaking. Seems a little odd while she's standing there waiting to speak. Wax-like. Frozen.
Ron Paul: Getting his points across.
Pawlenty: Mixing it up with a variety of folks. He's trying to establish himself in this campaign right now.
Romney: Still annoying me. He is a really bad campaigner. But he has good moments and bad. Sometimes he believes what he says and it comes out better.
Bachmann: Has moments of likeability, especially while she's actually speaking. Seems a little odd while she's standing there waiting to speak. Wax-like. Frozen.
Ron Paul: Getting his points across.
More debate thoughts
Forgot Ron Paul: I like having a few candidates that offer real choices and different options than the rest. Ron Paul adds to the debate. He broadens the options under consideration in the Republican field.
Mitt Romney: Back to his lousy campaigning now. He's trying to justify his record in Massachusetts with smoke and mirrors again. He sounds defensive and peeved.
Taxes: The candidates are back to group think. The litmus test is clearly on display. Let's watch them all bow down before America and swear their Republican credentials now.
Mitt Romney: Back to his lousy campaigning now. He's trying to justify his record in Massachusetts with smoke and mirrors again. He sounds defensive and peeved.
Taxes: The candidates are back to group think. The litmus test is clearly on display. Let's watch them all bow down before America and swear their Republican credentials now.
Republican debate - first impressions
I'm watching the Republican debate in Iowa now. The candidates are all seeming fairly likeable and I'm feeling more Republican as it gets under way.
Early thoughts on the candidates:
Congresswoman Bachmann: Likeable immediately until she mentioned her debt ceiling position. Suddenly unlikeable.
Mitt Romney: Started fine, which surprised me as I thought he has been a very bad campaigner based on reading news articles and hearing his sound bites.
Herman Cain: I like him. I like what he says. I like how he says it.
Gov. Huntsman: Ehhh. Need more information.
Gov. Pawlenty: Need more information. I currently feel very neutral toward him.
Newt Gingrich: Let's all admit that he is too wonkish and not presidential material. Although I have always found him interesting.
Rick Santorum: Did he speak? I must have missed it.
Early thoughts on the candidates:
Congresswoman Bachmann: Likeable immediately until she mentioned her debt ceiling position. Suddenly unlikeable.
Mitt Romney: Started fine, which surprised me as I thought he has been a very bad campaigner based on reading news articles and hearing his sound bites.
Herman Cain: I like him. I like what he says. I like how he says it.
Gov. Huntsman: Ehhh. Need more information.
Gov. Pawlenty: Need more information. I currently feel very neutral toward him.
Newt Gingrich: Let's all admit that he is too wonkish and not presidential material. Although I have always found him interesting.
Rick Santorum: Did he speak? I must have missed it.
Saturday, August 6, 2011
S&P downgrades U.S. credit rating
So the Standard&Poors credit rating agency actually downgraded their assessment of the United States' credit worthiness to AA+, as opposed to the superior AAA credit rating we previously shared with Germany, Canada, France and the U.K.
There were some interesting things in their assumptions and predictions about U.S. debt:
1. As opposed to those other countries whose debt is expected to stabilize, the S&P said the most likely outcome is that the U.S. will be in a deteriorating debt situation after 2015. Our debt, now at 74% of GDP is predicted to rise to 79% in 2015 and then to 85% by 2021.
2. They assume 3% GDP growth, and the extension of the Bush tax cuts for all after 2012. They also assume we will actually cut $2.1 trillion through this year's debt negotiations, as agreed on. Of that, $1.2 trillion is still to be negotiated by a congressional committee this fall.
They view these likely outcomes will leave us with a negative outlook for managing our medium and longterm debt. In other words, doing these things still leaves us in a bad and worsening spot.
What was also interesting were their "upside surprise" and "downside surprise" scenarios. In other words, how we might turn out better or worse, and why:
Their upside surprise scenario would still leave us with the AA+ rating, but they would consider it a longterm stable rating and would come about through the following actions:
- The Bush tax cuts would expire for high earners. This would essentially leave us with a stable debt situation - very slightly deteriorating in 2015 and 2021.
Their downside surprise scenario would leave us subject to a worsening credit rating from the agency and would involve the following actions:
- The further $1.2 trillion in cuts to be hammered out by a congressional committee this fall do not occur. This would lead to higher interest rates and continued loose monetary policy.
- They continue to assume the Bush tax cuts would remain in place as in their most likely prediction.
- This would leave us with a much worse debt situation: 74% of GDP now, 90% of GDP in 2015 and 101% of GDP in 2021.
It was very interesting to see their debt projections and how various policy decisions might affect that.
But it was most interesting to see what they viewed as the most likely outcome of all. In a sense they are examining our political environment and making a hard call about the likely result. Their prediction: We will extend the Bush tax cuts, cut $1.2 trillion more this fall and be in a negative longterm debt outlook.
But they also point the path to longterm stability for anybody paying attention: Just cut the Bush tax cuts for high earners. That's it. That might do the trick.
There were some interesting things in their assumptions and predictions about U.S. debt:
1. As opposed to those other countries whose debt is expected to stabilize, the S&P said the most likely outcome is that the U.S. will be in a deteriorating debt situation after 2015. Our debt, now at 74% of GDP is predicted to rise to 79% in 2015 and then to 85% by 2021.
2. They assume 3% GDP growth, and the extension of the Bush tax cuts for all after 2012. They also assume we will actually cut $2.1 trillion through this year's debt negotiations, as agreed on. Of that, $1.2 trillion is still to be negotiated by a congressional committee this fall.
They view these likely outcomes will leave us with a negative outlook for managing our medium and longterm debt. In other words, doing these things still leaves us in a bad and worsening spot.
What was also interesting were their "upside surprise" and "downside surprise" scenarios. In other words, how we might turn out better or worse, and why:
Their upside surprise scenario would still leave us with the AA+ rating, but they would consider it a longterm stable rating and would come about through the following actions:
- The Bush tax cuts would expire for high earners. This would essentially leave us with a stable debt situation - very slightly deteriorating in 2015 and 2021.
Their downside surprise scenario would leave us subject to a worsening credit rating from the agency and would involve the following actions:
- The further $1.2 trillion in cuts to be hammered out by a congressional committee this fall do not occur. This would lead to higher interest rates and continued loose monetary policy.
- They continue to assume the Bush tax cuts would remain in place as in their most likely prediction.
- This would leave us with a much worse debt situation: 74% of GDP now, 90% of GDP in 2015 and 101% of GDP in 2021.
It was very interesting to see their debt projections and how various policy decisions might affect that.
But it was most interesting to see what they viewed as the most likely outcome of all. In a sense they are examining our political environment and making a hard call about the likely result. Their prediction: We will extend the Bush tax cuts, cut $1.2 trillion more this fall and be in a negative longterm debt outlook.
But they also point the path to longterm stability for anybody paying attention: Just cut the Bush tax cuts for high earners. That's it. That might do the trick.
Thursday, August 4, 2011
Debt limit raised
I've been quiet during the final hours of the debt debate - not knowing the eventual shape of the deal that would be forged. I wasn't against the Boehner plan - but didn't like the balanced budget amendment thrown in at the end. I also didn't like the need to almost immediately revisit the budget limit again once passage was over. But other than that, the proposal did not seem that different than Harry Reid's proposal in the Senate. It seems like a lot of split hairs to fight over so vigorously. I guess everybody was jockeying to call the end result a "victory."
I also don't mind the final deal. It doesn't cut a lot. It demands a congressional committee to come up with the real cuts. And it allows an up or down vote on those. That's fine. If they need that kind of structure to get controversial things done, than so be it. I guess hard decisions are nearly impossible to make in Washington.
Here is my score of the participants:
The Republicans: It's hard to lump them together, as I feel there is a major split here amongst those who favored compromise and those who didn't. So I won't score them as a group.
The Democrats: They came out fine, even though they caved in a major way in the end. But that's OK with the people, so I think they'll be fine.
The Republicans who favored compromise: Thank you. We need some compromise in government.
The Tea Partiers: It's hard to like them. They are infuriating. But they also are dragging the country to cutting spending, which is needed in the long term. So I give them a grudging show of support for moving the focus of the debate rightward. But I feel they are going about it all wrong in many ways. Why focus on current spending? Why focus on next year's spending or even this decade's spending? We need long-term entitlement and Medicare reform. So why back away from that deal and force the country to something less worthwhile. I think the tea partiers in their stubbornness missed the grand bargain out of spite.
President Obama: Believe it or not, I think he came out fine. I didn't need a detailed budget out of him. I needed the spirit of compromise. And I got that. There was no question in my mind that he would cave to whatever deal Congress came up with in the end. And I placed most of the onus on Congress to solve this problem. That's their job. It's the House's job to lead the way. Obama did what he had to do.
So in the end there really were no clear winners or losers. Perhaps that's the way Washington muddles through. It's awfully distracting though, during the mess of a process we have. And now everybody is going to hunker down and start saving for retirement. I don't see how that helps our immediate economic prospects.
But I look forward to seeing what that Congressional committee comes up with by Thanksgiving.
I also don't mind the final deal. It doesn't cut a lot. It demands a congressional committee to come up with the real cuts. And it allows an up or down vote on those. That's fine. If they need that kind of structure to get controversial things done, than so be it. I guess hard decisions are nearly impossible to make in Washington.
Here is my score of the participants:
The Republicans: It's hard to lump them together, as I feel there is a major split here amongst those who favored compromise and those who didn't. So I won't score them as a group.
The Democrats: They came out fine, even though they caved in a major way in the end. But that's OK with the people, so I think they'll be fine.
The Republicans who favored compromise: Thank you. We need some compromise in government.
The Tea Partiers: It's hard to like them. They are infuriating. But they also are dragging the country to cutting spending, which is needed in the long term. So I give them a grudging show of support for moving the focus of the debate rightward. But I feel they are going about it all wrong in many ways. Why focus on current spending? Why focus on next year's spending or even this decade's spending? We need long-term entitlement and Medicare reform. So why back away from that deal and force the country to something less worthwhile. I think the tea partiers in their stubbornness missed the grand bargain out of spite.
President Obama: Believe it or not, I think he came out fine. I didn't need a detailed budget out of him. I needed the spirit of compromise. And I got that. There was no question in my mind that he would cave to whatever deal Congress came up with in the end. And I placed most of the onus on Congress to solve this problem. That's their job. It's the House's job to lead the way. Obama did what he had to do.
So in the end there really were no clear winners or losers. Perhaps that's the way Washington muddles through. It's awfully distracting though, during the mess of a process we have. And now everybody is going to hunker down and start saving for retirement. I don't see how that helps our immediate economic prospects.
But I look forward to seeing what that Congressional committee comes up with by Thanksgiving.
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