Posted by
Bill Crawford on Friday, May 21, 2010 1:26:00 PM
The stock market is falling again, but it is not a panic. It is a flight to safety, and with your retirement money, folks. You should be cheered. I know I am- there is still some rationality left out there. In the short term, it is in part because the Europeans, trying to arrange an agreement to stem the problems with the currency (Greece is only the tip of the iceberg) are showing that the Ivy League economists running our government share their ideas.
Which brings us to the magical financial regulation and reform that Democrats here are trying to express mail to Obama's desk. They all seem to think that, either there should be less risk in the market, or they should start cleaning house of the methods the investors use to abate risk. That's the difference between those who think that Lehman and AIG are a manipulator of the market and those who think they are indicative of the market. That lesson should already have been learned. Nearly a decade ago, Sarbanes/ Oxley should have taught us by now that Congress' best efforts to not allow another Enron did not, and created another series of accounting and legal hoops for corporations to jump through, which we all pay for, folks.
Let's move on. The White House and the DNC looked around after the latest batch of primaries and placed a giant lawn dart on PA 12, where a Democrat won Murtha's open seat. Have you listened to this guy? He campaigned against Obama AND his health care. He is pro-gun and pro-life. He is the poster boy of the seies of conservative Dems chosen by Rahm Emanuel to win enough swing districts in '06 to take back the House. THAT is your lifeboat? Let's get this straight, folks: the only chance the Democrats have to avoid getting beaten like a pinada this year is for the President to start talking like a Tea Party spokesman.
Unemployment is still at 10%, and shows no signs of moving anywhere, up or down. The economy is veering between short growth spurts and flat quarters. The deeper point would have to be, what is the plan for stepping out of it? How long will it be before this White House gives up on the answer being more government spending? My own answer to that is- never. Not even after they leave office. Once John Maynard Keynes is in the blood, the only cure is formaldehyde.
Which leads me to my most curious observation. The new federal fiscal year starts in October- where is the budget? Nothing has been sent up to the Hill as yet. The White House seems to be operating on a series of agreements between the Senate leadership and the House Appropriations Committee. Agreements based on what? Nobody outside the room knows for sure. Is this the new Obama transparency again?
What I do have is a sense from nearly all the people I talk to that the $1 trillion + a year deficit spending is being considered a new baseline. My question is, if they are confident that that is the direction to go in, why do they try to hide it?
The mistake on their part is, no matter how much they try to sit on it, if they try to buy a Summer of peace by not hammering a budget out of it, when it does come out, there will be less time to spin it or fix it before Election Day hits, and that will probably end up being one of the final pieces in the perfect storm they are going to walk into this November.
The great tragedy of that is that the Chicago mafia running this administration are not political dancers. There will be no "the era of big government is over" speeches from Obama. They will try what they are doing now until the bitter end, and will do their level best to explain why their failure wasn't their fault.
It is interesting to watch. To me, it is like watching what would have happened if Goldwater were propelled by events to eke out a win in the '64 election, and got a lesson in why his campaign bluster all of a sudden became a hindrance. The '64 version of Barry would not have understood any better than the modern Barrack.