Who?

Muammar Qaddafi (New Yorker)

Moammar Gadhafi (Globe and Mail)

Muhammar Gheddafi (Corriere Della Sera, Italian national business daily)

Moammar Gaddafi (Voice of America)

Muammar Gaddafi (Time)

Moamer Kahafi (Agence France Presse)

This guy's been in power for 42 years, and still we can't agree on his name?

Update

So it's not just me. The Christian Science Monitor online (actually, CSM scrapped its print edition a few years ago, so that's redundant) just posted this:

Gaddafi? Kadafi? Qaddafi? What's the correct spelling?

You say, Gaddafi, we say Qaddafi. Other variations on the leader of Libya include "Gathafi," "Kadafi," and "Gadafy," creating an unholy mess for newspaper editors.

 
(AP)

 

Here and Now. Wed., Feb. 23.

Libyian uprising

 
Moammar Gadhafi. (Reuters) At least, that's the Star spelling. There are many others. 

There may be more at stake in Tripoli upheaval than those of Cairo and Tunis. (Michael J. Totten, New Republic)

Gadhafi's inevitable fall won't trigger oil crisis. (Peter Foster, National Post)

How Gadhafi lost Libya. (Andrew Solomon, New Yorker)

 
Libyian dissidents. (AP)

Lethargic European response to Mideast unrest arises from fears of higher oil prices and flood of refugees. (Robert Marquard, Christian Science Monitor) Believe it, too, since both David Cameron and Sarko have recently denounced multiculturalism as a failed notion. Egalite, liberte, fraternite?  Don't mistake that as a universal hope. We're hogging it for ourselves. Rule #1 in geopolitics: All nations act in their own self-interest. 

Libya's revolution, Europe's shame. (El Pais, Madrid) Europe preoccupied with tide of North African migrants than how to help spur liberation.

U.S. government shutdown

So, what happens if the government shuts down? (Annie Lowrey, Slate)

Who wins and loses if the plug is pulled on Uncle Sam? (David Corn, Politics Daily)

What's really at stake in the shutdown threat. (Robert Reich, RobertReich.com)

Wisconsin showdown

Poll shows majority oppose restricting collective-bargaining rights of public servants. (Christopher Weber, Politics Daily)

 
David and Charles Koch. (AP) 

Billionaire Koch brothers' money is backing state's union-busting bid. (Eric Lipton, NYT) In case you missed it, here's Jane Mayer's brilliant 2010 profile of Koch brothers' secretive business empire and the lads' reactionary political machinations in the New Yorker.

Gov. Scott Walker also has Medicaid in his sights, along with public-employee unions. (Jonathan Cohn, New Republic)

GOP-appointed Indiana deputy AG tweets that "live ammunition" should be used against anti-austerity protesters in Wisconsin and elsewhere. (Adam Weinstein, Mother Jones) Elsewhere would include Indianapolis, also gearing up for harsh austerity measures under a GOP governor.

The dismal science

Government austerity measures rarely deliver the advertised benefits. (Felix Salmon, Reuters)

Tyler Cowen's much-discussed forecast of endless economic malaise is a dicey one. (Timothy Noah, Slate)

7 habits of highly frugal people.(Moneyning.com) Habit #1. Don't rise from bed. Habit #2. Repeat Habit 1 as necessary.

Lunacy

GOP-appointed Indiana deputy AG calls for "live ammo" to be used against anti-austerity protesters in Wisconsin and elsewhere. (Adam Weinstein, Mother Jones) Elsewhere would include Indianapolis, also gearing up for harsh austerity measures under a GOP governor.

Arizona to proceed with declaring an official state gun, weeks after Tucson tragedy. (Lesley Ciarula Taylor, Toronto Star) Proponents argue official state fossil, flower, motto, et al, should be accompanied by state gun. Appears that Arizona soon to have two state fossils, petrified wood and the legislature in Phoenix.

Big thoughts

 
(AP)

Where have all the good men gone? (Kay S. Hymowitz, WSJ) Latest update on a story commissioned by lifestyle editors every 4.7 years since Gutenberg ran a small item on it. The twist this time, in an  excerpt from Hymowitz's Manning Up: How the Rise of Women Has Turned Men Into Boys? Explains the author: "With women moving ahead in our advanced economy, husbands and fathers are now optional, and the qualities of character men once needed to play their roles—fortitude, stoicism, courage, fidelity—are obsolete, even a little embarrassing." Didn't Danielle Crittenden already write this (widely discredited) book already, about 15 years ago? It always comes down to the same thing: If only women would quit over-achieving, we could get back to women as second-class citizens and life would be peachy again. No question, though, that men aren't maturing soon enough - or at all.

Where do bad ideas come from, and why don't they go away? (Stephen M. Walt, Foreign Policy)

Cellphone use tied to brain changes. (Tara Parker-Pope, NYT)

Adrianna Huffington's lucrative haul on sale of HuffPost a sign of plunder of unpaid online contributors everywhere? (Chris Hedges, TruthDig)

A&E

 
Colin Firth in Pride and Prejudice. (Studio handout)

Colin Firth, "thinking ladies' leading man." Photo gallery. (Time) I hope my newsroom colleagues would be politically correct enough not to let me get a headline like that past them.

Adventure

In the wilds of the Canadian North, I stared down a polar bear and lived to tell about it. (Sara Wheeler, Slate)

Oy

 
Ronald Reagan, erstwhile regular on "Dean Martin Roasts." (AP)

Poll finds Americans pick Reagan as best-ever president. (Christopher Weber, Politics Daily) Also, they regard Ted Baxter as the most fully realized character on "The Mary Tyler Moore Show." (Okay, I made that part up.)

Baghdad seeks $1 billion from U.S. for damage caused since 2003 U.S.-led invasion. (Aseel Kami, Reuters) Aggh, what's Shia for chutzpah? (Why don't you take it out of that skid of greenbacks that "disappeared" while Bremmer was consul?) Anyway, send it with the other bills to G.W. Bush, General Delivery, Crawford, Tex.

No girls allowed: Dr. Pepper (edit - who/what that?) launches a "manly" diet drink, Dr. Pepper 10, labeled "Not for women." (Time) A publicity stunt by the fading Dr. P, no less transparently so than Harlequin's bid to patent the kiss. (Full disclosure: The Star and Harlequin share a common parent in Torstar Corp.)

About time

 
Gingrich is challenged by Dem at U of Penn appearance on how does Newt square his family-values blather with his 1990s extramarital affair. (Politics Daily, Politico, Daily Pennslyvanian) As I was just saying, we need more progressives like this brave Dem calling out these mountebanks in public. (Alas, the unscheduled speaker incorrectly gave the impression Newt's had just one affair.) Here, BTW, is John Richardson's Newt profile from August's Esquire, which as an aside is awkwardly revealing about the former speaker's serial philandering.   

 

Tear down this myth!

 

You've noticed the wave of counter-revisionism to the Reagan idoltry of late. No? Well here's some I've taken note of.

In New Republic, Jonathan Chait has usefully explained that Reagan and his legacy are complex, and thus a challenge for admirers and detractors alike. No. 40 often reversed himself on core values, in public and private life. That does make it tough for neo-cons to credibly claim Reagan as a reliable hero.

But they do it anyway. It was Reagan, finally, who restored legitimacy to conservatism, effectively a shipwreck from 1933 to 1980 (even Ike was wedded to FDR-era social justice). Also, there's no competent or ideologically correct alternative in the GOP pantheon.

Neo-cons would be challenged to embrace the legacies of Lincoln and TR, among the most progressive presidents. (Lincoln found time during the Civil War to implement the land-grants policy by which the frontier was settled.) How about the Nero-esque trio of Harding, Coolidge and Hoover? Or Ike, a moderate in office who couldn't make up his mind that he was a Republican until the year he was elected president, and then built the Interstate Highway System megaproject? Or Nixon, who created the EPA? Or Bush I, who broke his solemn vow not to raise taxes? Or Bush II, who accumulated the Republic's biggest debt and deficits; in Homeland Security created the biggest new bureaucracy since the Defence Department in 1947; in seniors' pharmacare brought about the biggest new government entitlement program since Medicare; and audaciously intruded on states' rights - cherished by neo-cons - with No Child Left Behind (with the ardently sought assistance of, OMG, Ted Kennedy)?

Chait provides a balanced view of Reagan, the Democrat turncoat, erstwhile union leader (Screen Actors Guild), GE flack, alarmist about the socialist threat posed by Medicare, and B-list star of Bedtime for Bonzo. But there's no getting around the fact that:

The main accomplishment which he's credited, winning the Cold War, is one in which his policies contributed a very small amount. The most important cause of the fall of the Soviet Union by far was its failed, unsustainable political and economic system, which would have eventually collapsed regardless of American policy. ...

Domestically, Reagan had two main accomplishments: One was to legitimize the religious right as a powerful Republican constituency, a change that has continued to reverberate through American politics. The second was to legitimize massive, non-emergency deficits.

If you're at a loss on how Bush II: Return of the Fiscal Spendthrifts came about, handing off to Obama a record debt and deficits (as Reagan did to Bush I, and Bush I did to Bill Clinton - rarely has there been such a yawning gap between what a party stands for and what it does), Chait helpfully recalls that in an unguarded moment Dick Cheney told an interviewer for a book on the Bush II administration that "Reagan proved deficits don't matter." That would be high apostasy coming from a genuine conservative, rather than the neo-con variety. But then, the Bushies Redux really did operate in an alternative-reality field. The mystery is how Bush II got re-elected (or re-inaugurated, I should more accurately say), given that most of the damage he wrought was front-loaded in the first of his two terms, along with his well-publicized record of creating fewer jobs than Hoover. Bush's second term made a mockery of his immediate post-election assertion that he'd be no lame duck. "I've got political capital, and I intend to use it," he said in late 2004. The words were barely out of his mouth and Katrina destroyed what remained of a presidency that was more lame duck in its second term even than the twilight years of a chronically bedridden Wilson.

The more frankly liberal Bob Herbert reminds us that Reagan was a self-described "tax-cutter who raised taxes in seven of the eight years of his presidency. He was a budget-cutter who nearly tripled the federal budget deficit."

It is the economic revolution that gained steam during the Reagan years and is still squeezing the life out of the middle class and the poor that is Reagan's most significant legacy. A phony version of that legacy is relentlessly promoted by right-wingers who shamelessly pursue the interests of the very rich while invoking the Reagan brand to give the impression that they are in fact the champions of ordinary people.

Reagan's son, Ron, says in [a Reagan documentary] that he believes his father "was vulnerable to the idea that poor people were somehow poor because it was their fault." A clip is then shown of Ronald Reagan referring to, "The homeless people who are homeless, you might say, by choice."

Yes, a few tireless souls are still searching for the famous "welfare queen" that No. 40 liked to invoke in delegitimizing a welfare state he in fact presided over the enlargement of. (Reagan cut some programs until a Dem-controlled Congress re-funded them. Reagan's preferred method of degrading government was simply not to enforce the laws, and to appoint to his administration cabinet officers like James Watt at Interior and Anne Burford at the EPA who were greatly at odds with the mission of government departments and agencies.  

But here's the wild part. A recent poll finds Americans declaring Reagan their favorite president. Another of Reagan's legacies was the "Teflon presidency," a term of Reagan contemporary Rep. Pat Schroeder (D-Ca.) 

Mencken wrote that the people deserve the government they want, and "they get it good and hard." While not a fan of the anti-Semitic Bard of Baltimore, I acknowlege there's much to that.

My question about oppressed peoples around the world, after agonizing over their plight and including them in my prayers, is why do they put up with what passes for governance in Zimbabwe or Burma? Stalin massacred tens of millions of Russians. At what point does a population vastly outnumbering the ruling cabal simply rise up and remove it? Why does it take so long?

Israel apart - and that's a nation sometimes said to have as many political parties as people, so vibrant is its democracy - is so obviously far advanced on the road to social and industrial progress that you do have to wonder why the events now unfolding elsewhere in the Middle East and in North Africa had to wait until now. I am excited by the overturning of a fetid order. But, my gosh, Mubarak ruled for 30 years, Gaddafi for 40. How long does it take a people to impose their will in service to their own best interests?

So in contemplating Reagan and the stubborn resistance to progressivm that Thomas Frank chronicled in What's The Matter With Kansas?, you do have to assume that, on some level, everyday Americans are broadly content with a status quo that works powerfully against their interests. And sort of leave it at that. Because no one much enjoys shouting into the wind.

I need no convincing that Reagan ushered in three decades of middle-class deterioration, making a hash of the "American Dream." But Americans, notably such unusual suspects as the Teamsters and "Reagan Democrats" in unionized, progressive precincts like Michigan, enthusiastically embraced Reagan's ideal of America, so at variance with the realities of making ends meet on farms and in suburban bunglows. The best we can assume is that Americans are irretrievably bewitched by this depiction of themselves as rugged individualists, even as they collect from Uncle Sam their Social Security, Medicare and Medicaid checks, their 401k middle-class tax breaks and mortgage-interest deductibility (sure wish we had that in Canada), farm support payments, and truckloads of corporate welfare for the down-at-the-heels oil industry.

A non-American trying to grasp this strange country's self-regard can only look to fabulists like like Voltaire, and see in the fantasyland of America's imagining the plot outlines of Candide.

 

Related

Salon has a series of essays debunking the Reagan mystique:

The racist "Southern strategy" that Nixon hatched and Reagan exploited. (Steve Kornacki) 

When Reagan was (much) less popular than Carter. (Steve Kornacki)

How Reagan succeded in dishonestly demonizing LBJ's Great Society. (Joan Walsh)

 

 

Enjoy your day.

 
(Getty Images)

 

 

Small world.

 
 

Signs of the times in Madison, Wis. Who might imagine Americans protesting for economic justice would someday take their lead from compatriots for justice in the streets of Alexandria and Cairo? (And Tunis, Amman, Tripoli...)

As for the second sign, it's an intriguing thought, if coarsely put.

There's historic precedent for that gambit. It was called "revenge of the cradle," the means, through prolific procreation urged by Catholic clerics, to swamp the English who defeated New France in 1759. The generations-long practice, extending well into the 20th century, worked like a charm. One example: Quebec City, former HQ of New France, which extended into the U.S. Midwest and down the Mississippi to New Orleans, was a majority English-speaking city in the 1850s. Today it is more unilingual French than Paris or Lyon.

So yes, revenge of the cradle. "Progressives of the world, procreate! You have nothing to lose but your chains."

Or course, some of you will give birth to clones of David Frum, who was, I understand, born in a blue suit. But the odds are with you.  

Photos: AP

 

 

 

Waiting for progressives to fight back.

George Lakoff's diagnosis of what ails Dems has echoes of past complaints I've made on EB. He puts it succinctly, and the timing is apt:

Democrats also help conservatives by what a friend has called Democratic Communication Disorder. Republican conservatives have constructed a vast and effective communication system, with think tanks, framing experts, training institutes, a system of trained speakers, vast holdings of media, and booking agents. Eighty percent of the talking heads on tv are conservatives. Talk matters because language heard over and over changes brains. Democrats have not built the communication system they need, and many are relatively clueless about how to frame their deepest values and complex truths.

And Democrats help conservatives when they function as policy wonks — talking policy without communicating the moral values behind the policies. They help conservatives when they neglect to remind us that pensions are deferred payments for work done. “Benefits” are pay for work, not a handout. Pensions and benefits are arranged by contract. If there is not enough money for them, it is because the contracted funds have been taken by conservative officials and given to wealthy people and corporations instead of to the people who have earned them.

Democrats help conservatives when they use conservative words like “entitlements” instead of “earnings” and speak of government as providing “services” instead of “necessities.”

I was thinking today of how important it is for leaders to do the right thing and be seen to be doing it, and how difficult that is.

Consider for a moment that the public-policy architects whom we too often mockingly describe as "wonks" (you don't here about oncology "wonks," though they are legion, and thank god for that), have a high mountain to climb. Then, after considering the virtues and potential unintended consequences of sound public policy, consider the challenge for those who must "sell" those policies - for this is a democracy, lacking the advantages of decisiveness Beijing enjoys.

Damn right, you need "factories" to develop sound and innovative ideas, and some crowd-pleasers too. You need a Greek chorus of opinion-shapers in academe and the mainstream media to embrace and help sell those ideas. You need a united political party to do the same, from door-to-door and in mailings to one's district, and op-ed contributions to a congressman's local papers.

You do need to agree on a new common language, one vastly more connected to where people live, and thus more appealing, than the dry words used especially by top Dems.

The mistake since 2008 - sorry to have to keep repeating this - was to think that motivating the troops for an election would suffice. Obama understood; on the hustings he pleaded those then-adoring troops to follow him, figuratively speaking, into the WH. Those ground troops in Des Moines and Spokane and Orlando would be needed to continue making the case, long after the election, for why the Dem agenda must prevail. It must be implemented in order to head off American insolvency by mid-century; to win rather than lose the economic competition of the 21st century versus China and India, thorough root-and-branch education reform. And it must happen to ensure - and what nobler cause could there be than this? - that quality healthcare becomes a right and not a privilege of citizenship.

Instead, the troops immediately vanished. Granted, they had a Great Recession suddenly to preoccupy them. Granted, too, Dems had made enormous gains in two consecutive election cycles, now controlling two of three branches of government. But somehow the "you can relax now, you've been thoroughly discredited" memo didn't reach the insurgent Tea Partiers and their allies on Hate Radio. And you would know - or should have known - from the Clinton early-years experience that these folks would seek to discredit your progressive agenda from the get-go. The forces of reaction protested. They found, in their vocabulary, a way of powerfully connecting with everyday Americans. And so such a basic thing as better health for Americans long into the century was, with stunning ease, reduced to "death panels," a vile canard that was a god-given opportunity to expose the non-progressives as not only insensitive but hopeless uninformed about what exactly is healthcare. (A "death panel" is what Limbaugh, first, then Palin, chose to label the everyday "end of life deliberations" that families conduct with a dying patients' physicians, to determine what to do - and one of the five Congressional committees developing a healthcare reform bill thought that those patients and their families should no longer be billed by the hospital for such grim proceedings - the least your government can do. Somehow that compassionate initiative got turned into remote, faceless bureaucrats deciding to prematurely end the life of Americans.)

Where was Jim Carville's war room to stomp all over "death panels" the second it emerged, and use it to play offense by showing, "See, you can't trust what the reactionaries say. They don't know the first thing about healthcare."

 
Wisconsinites protesting against assaults on collective-bargaining rights for public service workers. (AP)

There is still time to recapture the initiative. For Lakoff, an encouraging sign is the protests in Madison, Wis. I agree, but we need look further. For starters, the "Madison model" must be replicated everywhere in America where the GOP - and even Dem governors - plan to balance the budget on the backs of the poor and working class. Yes, let summer 2011 be a season of protest across America, this time by progressives.

In the higher reaches, through coordinated action, spokespeople for a Dems' "caring agenda" must be recruited. Which means that I will no longer read of how Obama, after the SOTU address, will light out for the territories to reinforce, and "sell," his message about "Winning the Future." As if this is the president's job alone. He has unfolding events in Tripoli and Cairo, and Afghanistan, and on a still misbehaving Wall Street and an unresponsive Beijing, to concern himself with also.

No, the day after the SOTU and similar landmark events in which the Dem agenda is promulgated, I want to see Dem senators, members of Congress, governors and state legislators out there echoing and reinforcing that progressive agenda. I want them hogging the airtime, and using the using the blunter vocabulary that Lakoff correctly advises.

I've been dismayed, time and again in the past two years, that Dems have remained in hiding as their lonely leader makes the progressives' case to the American people. Such is the late 20th century mystique of the presidency, that it is all-powerful in the minds of too many. It isn't, never has been. Pre-1970s, a president always had an army of high-placed surrogates in the legislative branch and in statehouses to promote his message, along with supportive progressive journals and academics who contributed op-eds in the Minneapolis Star-Tribune and Denver Post.

There has indeed, for decades, been a "vast right-wing conspiracy," the one Hillary Clinton took only abuse for identifying in the late 1990s. The time has come to stop whining about it. And instead replicate the GOP infrastructure for opinion-shaping - and pathetic efforts like the late Air America obviously won't suffice.  

We seem to have entered an era, without noticing it, in which Michelle Obama is supposed to deal with Michele Bachman on breastfeeding. (Only a "nanny state" would assist low-income pregnant women by making breast pumps tax deductible, sayeth the wise Minnesotan.) Before the First Lady gets a chance to clear her throat, a hundred esteemed pediatricians, politicians expert in healthcare, academics and authors of tomes on this subject, should fall out of the sky and squish Bachman like a bug. Which would discourage GOP and even Hate Radio from spreading lies and distortions, knowing the consequences of such rapid and through ridicule. For now, however, founts of such ignorance can count on pleasing the GOP base and finding a reinforcing embrace from Hate Radio. There are, in short, no consequences to articulating bad public policy - except for the present and future of the Republic, of course.

And progressives are wholly to blame for that.

 

Photo of George Lakoff courtesy Georgelakoff.com. Photo montage Michele Bachman and Michelle Obama, AP.

 

Get serious.

The House GOP proposes to break the back of America's gross indebtedness by starving Big Bird, Planned Parenthood, the EPA (guardian against mercury contamination), the IRS (guardian against tax cheats), the USDA (guardian against e. coli), and money for a park in Nancy Pelosi's district.

At the last minute, an Arkansas GOP congressman withdrew his proposal to cut funding for the president's teleprompter. Tax breaks for the oil industry will remain. Also aid for Israel (one of the wealthiest of aid recipients). And the Defense Department's budget to sponsor Nascar racers. Never mind that auto racing's popularity is in decline, and the Pentagon sponsorship is a recruiting tool the Navy and Marines decided some time ago to scrap for lack of efficacy.

So John Boehner is lying when he says, "Everything's on the table. We're broke."

Much of the above thanks to the NYT's must-read Gail Collins. What follows is Paul Krugman, further to the point:

The whole budget debate, then, is a sham. House Republicans, in particular, are literally stealing food from the mouths of babes - nutritional aid to pregnant women and very young children is one of the items on their cutting block - so they can pose, falsely, as deficit hawks.

What would a serious approach to our fiscal problems involve? I can summarize it in seven words: health care, health care, health care, revenue. ...

What would real action on health look like? Well, it might include things like giving an independent commission the power to ensure that Medicare only pays for procedures with real medical value; rewarding health care providers for delivering quality care rather than simply paying a fixed sum for every procedure; limiting the tax deductibility of private insurance plans; and so on. [The latter - known as "gold-plated" or "Cadillac" insurance plans - are paid for by customers of the corporations offering them to their most exalted hands, and by Main Street taxpayers who fund this tax break when corporations report the cost as an eligible tax deduction.]

And what do these things have in common? They're all in last year's health reform bill.

That's why I say that Mr. Obama gets too little credit. He has done more to rein in long-run deficits than any previous president. ...

This brings me to the seventh word of my summary of the real fiscal issues: if you're serious about the deficit, you should be willing to consider closing at least part of this gap with higher taxes. ... We should add to the roster of fundamentally unserious people anyone who talks about the deficit - as most of our prominent deficit scolds do - as if it were purely a spending issue.

Reagan, Bush 41, and Clinton all raised taxes. And the U.S. economy thrived as never before. And, of course, for the first time since the 1970s, Washington began posting budget surpluses by the late 1990s.

Obama also is not credited for his three tax breaks in just two years in office, skewed to middle-class and low-income families. He has allowed Obamacare to be depicted as an added burden to the taxpayer, when it is just the opposite. Obamacare is a package of cost-reduction initiatives that is America's best hope for restoring the nation's finances. Too bad it wasn't sold that way. Or really, sold at all.

 

Krugman is calling here for a sensible twin-track strategy of cutting government costs and raising revenues. Obamacare will save money while improving care. (More on methods for that below.) But it needs to be accompanied, on the revenue side, with modest tax increases of the same modest size that Clinton imposed on the richest Americans in his 1993 budget. That landmark budget, which passed without a single GOP vote (Gingrich warned it would throw the U.S. into deep recession), culminated in surpluses and the creation of a record 23 million new jobs.

Much of what one needs to know about innovative health care solutions has been, and continues to be, chronicled by Atul Gawande, a contributing writer at the New Yorker who somehow also manages to keep up with his duties as an endocrine surgeon at Boston's Brigham and Women's Hospital and an associate professor at Harvard.

Recall that Gawande last year discovered that identical health care services were priced wildy apart, not only between Minnesota (reasonable) and Texas (grossly over-priced), but between neighboring towns in Texas. It was at that point that Gawande became required reading at the WH.

Gawande's latest field report describes healthcare pioneers who identify the sickest people in a community - the 5% of people accounting for 60% of local health care costs. These people are provided an "ambulatory ICU" of attentive care and help in changing unhealthy behaviors. The health of the patients improves by significant measure, while their emergency-room visits - previously scores of them per year for many individuals - falls sharply. Of course, ER visits are the costliest means of delivering care. Here's Gawande's latest report and his reply to reaction to it elsewhere.

Bottom line: Health care, despite accounting for roughly one-fifth of the U.S. economy, has resisted reform more stubbornly than any major institution in society - more even than post-secondary education, which is notoriously slow to embrace change. If wrenching reforms had been attempted and still health care costs have skyrocketed, that would be sobering indeed. But the good news is that reforms have not been attempted, save for minor initiatives around the edges. The good news is that America needn't become insolvent by mid-century while more thoroughly caring for its people.

And America can afford another park for San Francisco.

 

Happy long weekend.

Friends

 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 

Gus thanks AP, CP, Paul Darlaston, Getty Images, Reuters and Wikipedia Commons for their help with this report.  

 

Here and Now. Sat. Feb. 19, 2011.

U.S. recovery "really taking hold," says Philadelphia Fed. (Chris Wallace, Daily Finance)

 
Nancy Pelosi and House Dem leadership. (AP)

Pelosi aide says government shutdown likely when cash runs out March 4. (Jonathan Allen, Politico)

New GOP governor wrong, unions not to blame for Wisconsin budget crisis. (Ezra Klein, WaPo)

As Florida joins Wisconsin and Ohio in rejecting fed funds for high-speed rail, NY, California, Maryland ask Obama for rejectees' share. (Craig Johnson, CNN)

Former U.S. senator Russ Feingold launches new progressive political movement. (Tom Diemer, Politics Daily)

 
Rove and GOP braintrust can't control delusional monster they helped create. (AP)

Even Palin and Rove think "birthers" are wacko and a distraction. (Nerve). Good luck with that. Half of Republicans believe the rumors that Obama is foreign-born. The real problem for the GOP with birthers is that most American's don't give a rat's ass where Obama was born. At the time Obama was elected, two of America's largest states, California and Michigan, had foreign-born governors. That was also a year when, but for Obama, America would have had its first woman president, eight years after its first Jewish presidential running mate. And if he's part-Muslim, which Obama obviously is - he campaigned on having a father from Kenya and mother from Kansas - couldn't that only help in understanding a culture that since 9/11 is of consuming interest to Americans? Even "socialist" is too obviously facile an attack word, especially now there's an avowed Socialist representing Vermont in the U.S. Senate. No, Obama's weakness is the economy, which most Americans recognize their politicians have an only limited ability to deal with (as they themselves do in their personal lives), and to a lesser extent empathy, where he suffers in the inevitable comparisons with a Bill Clinton still very much with us. Obama knows and cares about your suffering, and he's workin' on it, but he doesn't feel your pain the way Americans sensed Clinton did. But that turned into a cliche long ago, as Americans gave the presidency to a more (not entirely, that would be Wilson) professorial candidate in a near-landslide. Lately Obama is co-opting the GOP on coziness with business, so that Obama's actually weaker on his left flank than right. Much as I admire this president for his values and accomplishments, I think he's as delusional in his own way as the more extreme Tea Partiers if he really imagines that the CEOs he's been summitting with have any cures for what ails an economy that they drove into a ditch. FDR and big business made quasi-war on each other, and that worked well for FDR's coalition through four elections.

 
U.S. soldiers guard Afghan captive. (AP)

Why Germany must quit Afghanistan, yet another war built on lies. (Jurgen Todenhofer, Der Spiegel)

Indonesia's democratic transition could be model for Egypt. (Sara Schonhardt, Christian Science Monitor)

Will Canada export death by re-opening Quebec asbestos mine? (Andrew Schneider, AOL News)

Why you haven't felt the global spike in food prices - yet. (Annie Lowrey, Slate)

A bankrupt Borders hurts everyone, especially authors. (Karen Dionne, Daily Finance)

 
Boeing's troubled next-generation "Dreamliner" jetliner under assembly in Everett, Wash. (Getty)

Boeing's stalled 787 Dreamliner a case history in failed outsourcing. (Michael Hiltzik, LAT)

Apple investors should be told truth about ailing Jobs' health. (Robert Cyran, Reuters)

Sacrilege! "I hate my iPad." (John Swansburg, Slate)

No stunt: Phlly homeowner turns tables, forecloses on Wells Fargo branch. (Jeff Gelles, Philadelphia Inquirer)

 
Montreal's Arcade Fire were surprise Grammy winners. (Grammys handout)

Canada, Nashville gaining on NYC and LA in music-scene influence. (Richard Florida, Atlantic)

Vancouver cafeteria trays almost as bacteria-rich as toilet seats, B.C. lab finds. (CBC)

Men yak more, but women use more thoughtful language. (Nerve)

 

 

Do stock markets have social value?

Felix Salmon, among the best of the financial commentariat, at least raises the question, bless him. But then he punts, as he no doubt expects most sane folks would:

Has anybody ever tried to quantify the societal benefit of public stock markets, or the social harm that might be done if Facebook just stays private? Where would you even begin?

One should start, I suppose, by separating out equity markets from the larger capital markets in which stock trading commands far too much attention. (The bond market is vastly bigger.)

 

And rephrase the question: Since stock markets exist to allocate capital, are they any good at it? Better than the more staid precincts of the bond market? Uncle Sam? The Ford Foundation? The average household in its budgeting methods?

The answer should be "yes" because so much is at stake. The expression "It's only money" is for the philosophical of mind, and I'm not one of those. As with every expenditure, there is an "opportunity cost" for shareholders who could be doing something else with funds committed to the market. So there'd better be an above-average return on that stock compared with firms in the same line of business, with the broad market indexes, and investments in other asset classes.

Still, there is fantastic waste in the raising of public equity. The underwriters of Facebook, when and if that stock offering comes about, will rake off millions of dollars for handholding Mark Zuckerberg  through the process of going public. It will be an obscene sum, relative to the value of services rendered, as everyday people would see it.

There are lofty transaction fees in buying and selling on public exchanges, creamed off by brokerages with mark-ups to make any grocer blush with envy or outrage. Such fees are especially accumulated by mutual fund managers, who with their over-frequent trading of clients' portfolios (a.ka. "churning"), pass that dubious cost, along with their own steep transaction fees, to the client. Which cuts deeply into the returns of Main Street investors. (It would help if more than half of money managers could at least beat monkeys with dartboards in their stock-picking prowess.)

Exchanges, of course, rake in annual listing fees from each company privileged to trade on the exchange. Fees are exacted, too, by self-financing federal, provincial, state and territorial regulators in return for blessing what a listed company has to say for itself public notices - a benediction too easily granted more than half the time. They also pocket a nice sum for vetting initial-offering and secondary-offering prospectuses.

You can see, I hope, a great deal of money here that is not going into running the business that's raising the funds.

Salmon and I could benefit from a thorough, dispassionate examination of all the money collected in stock-market operations, and where it goes. We now do this with charities: How much of the funds raised helps the cause, and how much goes to administration and fundraising?

In normal times, and we've seen too few of those lately, there will be waste, as in all enterprises, public and private. But if in normal times it costs a nickel or less to raise a dollar, in an arena where Keynes' animal spirits decide the exact current value of a stock (and thus an entire company), I suppose that's of sufficient social value. Investors, given the benefit of transparency and equal knowledge to that of other investors, voluntarily finance the start-up of a McDonald's or the $1-billion cost of a new Intel foundry (silicon-chip factory). And that's a good thing, rather than Saddam Hussein deciding out of pique to starve Iraq's under-developed state-owned oil reserves of capital for two decades.

The problem, in addition to simply too much waste sloshing around in a process not efficient or disciplined enough, is that the markets collectively are given to buying and selling "panics" in which capital is wildly misallocated, in staggering sums that make the hijinks at City Hall or the statehouse seem trival. (Which they comparatively are.)

Investors, driven by the madness of crowds documented so long ago by Charles Mckay, have in the past decade alone run up the price (not the true value) of dot-com, pharmaceutical, telecom and financial stocks, then abandoned them, lemming-style, erasing about $8 trillion in shareholder value twice since 2000-01.   

No one dare call that efficient allocation of capital. The average district school board does a better job. But then, school administrators talk among themselves, while solo operators like Nick Leeson, based in Hong Kong, takes the two-century old Barings Brothers of London out for a joyride that ends with the venerable brokerage being totalled.

Which raises another problem, the inability of market participants - investors, traders, exchange operators - to learn from mistakes. Leeson begat the rogue trader who nearly brought down Societe Generale, one of France's largest banks; and the derivatives "innovator," also unsupervised, who from his knothole in London dragged down New York-based AIG, world's biggest insurer, now on U.S. government-provided life support.

We duck this question because once you pull that string, you soon find yourself asking if a company proposing to distribute gummi bears or launch yet another online dating service is an appropriate use of the planet's limited resources. Such decisions will be arbitrary, of course, opening the door to Ayn Rand & Co. to inveigh against those who presume to know what's best for us.

So, is dervatives trading of social value? The exchange of common shares of Exxon Mobil? The start-up equity in a wannabe wind-farm operator?

The answer again is yes, of course it has social value. Investors with their own money on the line, and with more to lose than a bureaucrat in making that same capital-allocation call, must be counted on to act in their best interests. Which, Adam Smith tells us, collectively align with those of society.

But my answer of a qualified "yes" is conditional on supervisory reforms, among exchange operators and state regulators, to ensure that issuers, traders, brokers and everyone else at the party is no longer groping someone else's partner, or taking flight from the roof just because everyone else is suddenly convinced they can fly without benefit of an airplane. And are denied entrance to the dance hall because their chatter, grooming, body language and long list of "priors" suggests that their presence might spoil the party for everyone.

Because you know who pays for calling out the police, fire and public health departments in the aftermath if it all goes wrong. That would be me, with a tax hike for emergency services that offsets my enjoyment from waltzing with Sandra Bullock and Annette Bening earlier in the evening.  

Obama and Congressional Dems failed to deliver promised tough reforms. And that's what gives Salmon and others just cause in raising such a fundamental question.