Palin Speaks to Investors in Hong Kong

Jonathon Stone, the chairman and CEO of CLSA Asia-Pacific Markets, with Sarah Palin at a meeting in Hong Kong on Wednesday.





Just yesterday I was wondering what'd happened to her, and to day I wonder what she could have said of interest to this audience.


''I'm going to call it like I see it and I will share with you candidly a view right from Main Street, Main Street U.S.A.,'' Palin told a room full of asset managers and other finance professionals, according to a video of part of the speech obtained by The Associated Press. ''And how perhaps my view of Main Street ... how that affects you and your business.''

Main Street? Gimme a break.

It marked Palin's first major appearance since she resigned as governor in July, and the speech's location and international scope could help boost her credentials ahead of a possible bid for president in 2012. While she's thought to be considering that, her Hong Kong trip bore no political overtones, said Fred Malek, a friend and Palin adviser.

Going to Hong Kong is foreign policy experience?

In her speech -- closed to reporters -- Palin argued that many average Americans are uncomfortable with health care reforms that infringe on private enterprise, Chris Palmer, an American fund manager for Gartmore Investment Ltd., told reporters.

They need her to know that? Why not just watch or read some news?

In an apparent reference to tensions between Muslim Uighurs and Han Chinese that have led to riots, Palin mentioned China's ethnic problems, arguing they are ''a sign that China lacks mechanisms to deal with regional issues,'' Palmer said.

They'll love that in Peking (oops, my age shows: Beijing).

She also criticized the U.S. Federal Reserve's intervention in the economy over the last year and praised the conservative economic policies of former U.S. President Ronald Reagan and former British Prime Minister Margaret Thatcher, according to another attendee who declined to be named because he didn't want to be seen as speaking on behalf of his company.

It is so easy to praise Ronald Reagan for his economic policies while ignoring their true impact and actual effects: he conducted deficit spending (Keynisian), cut taxes for the wealthy and threw the US into recession.

Hari Sevugan, a spokesman for the Democratic National Committee, said Tuesday the group knew little about Palin's speech.

''We're curious as to what she's willing to say in private but not in public,'' Sevugan said. ''Are there other countries that she can see from her window that she doesn't want us to know about?''

Touche.

All the President's zombies

August 24, 2009 - Op-Ed Columnist

All the President’s Zombies

By PAUL KRUGMAN

The debate over the “public option” in health care has been dismaying in many ways. Perhaps the most depressing aspect for progressives, however, has been the extent to which opponents of greater choice in health care have gained traction — in Congress, if not with the broader public — simply by repeating, over and over again, that the public option would be, horrors, a government program.

Socialism! Nazism!

Washington, it seems, is still ruled by Reaganism — by an ideology that says government intervention is always bad, and leaving the private sector to its own devices is always good.

Yeah, we sure learned that lesson. Let the free market reign, then, when it gets in trouble, and it pleads for help, don't get in its way. Cut taxes. Let capitalism work. So say the Republicans.

Call me naïve, but I actually hoped that the failure of Reaganism in practice would kill it. It turns out, however, to be a zombie doctrine: even though it should be dead, it keeps on coming.

Hell, even Democrats invoke Regan's memory now, even if they think his policies a failure and his reign a disaster: too many people idolize the Gipper to let the right wing monopolize his memory.

Let’s talk for a moment about why the age of Reagan should be over. First of all, even before the current crisis Reaganomics had failed to deliver what it promised. Remember how lower taxes on high incomes and deregulation that unleashed the “magic of the marketplace” were supposed to lead to dramatically better outcomes for everyone? Well, it didn’t happen.

Yet even the people hurt by Reaganomics want the Democrats to cut taxes for the rich, to allow corporations to hold sway over the economy, and to keep government out of everything (except for their favorite tax loopholes, mortgage interest deduction chief among many).

To be sure, the wealthy benefited enormously: the real incomes of the top .01 percent of Americans rose sevenfold between 1980 and 2007. But the real income of the median family rose only 22 percent, less than a third its growth over the previous 27 years.

27 years of Reagan (8), Bush 41 (4), Clinton (8) and Bush 43 (8).

Moreover, most of whatever gains ordinary Americans achieved came during the Clinton years. President George W. Bush, who had the distinction of being the first Reaganite president to also have a fully Republican Congress, also had the distinction of presiding over the first administration since Herbert Hoover in which the typical family failed to see any significant income gains.

But he was a good ole Texas boy (by way of Groton and Yale, but never mind).

And then there’s the small matter of the worst recession since the 1930s.

An inconvenient detail the Democrats and liberals bring up because they hate America and want to give aid and comfort to its enemies.

There’s a lot to be said about the financial disaster of the last two years, but the short version is simple: politicians in the thrall of Reaganite ideology dismantled the New Deal regulations that had prevented banking crises for half a century, believing that financial markets could take care of themselves. The effect was to make the financial system vulnerable to a 1930s-style crisis — and the crisis came.

Clinton deregulated with a vengeance, too.

“We have always known that heedless self-interest was bad morals,” said Franklin Delano Roosevelt in 1937. “We know now that it is bad economics.” And last year we learned that lesson all over again.

Socialist, that Roosevelt.

Or did we? The astonishing thing about the current political scene is the extent to which nothing has changed.

And now the right wing is screaming socialism, painting Hitler moustaches on the President, and scaring the hell out of the Democrats, who can not get their stuff together long enough to pass some legislation. Not yet, anyway.

The debate over the public option has, as I said, been depressing in its inanity. Opponents of the option — not just Republicans, but Democrats like Senator Kent Conrad and Senator Ben Nelson — have offered no coherent arguments against it. Mr. Nelson has warned ominously that if the option were available, Americans would choose it over private insurance — which he treats as a self-evidently bad thing, rather than as what should happen if the government plan was, in fact, better than what private insurers offer.

The sky might fall.

But it’s much the same on other fronts. Efforts to strengthen bank regulation appear to be losing steam, as opponents of reform declare that more regulation would lead to less financial innovation — this just months after the wonders of innovation brought our financial system to the edge of collapse, a collapse that was averted only with huge infusions of taxpayer funds.

Lobbying spending has been furious.

So why won’t these zombie ideas die?

Part of the answer is that there’s a lot of money behind them. “It is difficult to get a man to understand something,” said Upton Sinclair, “when his salary” — or, I would add, his campaign contributions — “depend upon his not understanding it.” In particular, vast amounts of insurance industry money have been flowing to obstructionist Democrats like Mr. Nelson and Senator Max Baucus, whose Gang of Six negotiations have been a crucial roadblock to legislation.

Or on pushing the lies and distortions that allow hsi benefactors to reap in great profits.

But some of the blame also must rest with President Obama, who famously praised Reagan during the Democratic primary, and hasn’t used the bully pulpit to confront government-is-bad fundamentalism. That’s ironic, in a way, since a large part of what made Reagan so effective, for better or for worse, was the fact that he sought to change America’s thinking as well as its tax code.

Thus far, the effort seems lackluster, though it may yet prove to be too early to call.

How will this all work out? I don’t know. But it’s hard to avoid the sense that a crucial opportunity is being missed, that we’re at what should be a turning point but are failing to make the turn.

September and October will prove the President's mettle: will he be able to knock heads together and have legislation passed? We'll see.

That's Madame Secretary to you

Palestinian Prime Minister Mahmoud Abbas, President George W. Bush, Israeli Prime Minister Ariel Sharon and Jordan's King Abdullah, June 4, 2003.










Mr. Abrams, a senior fellow for Middle Eastern Studies at the Council on Foreign Relations, handled Middle East affairs at the National Security Council from 2001 to 2009.

He was also a Reaganite.

Who did it?

Paul Krugman's answer? Same as mine.

June 1, 2009 - Op-Ed Columnist

Reagan Did It

By PAUL KRUGMAN

“This bill is the most important legislation for financial institutions in the last 50 years. It provides a long-term solution for troubled thrift institutions. ... All in all, I think we hit the jackpot.” So declared Ronald Reagan in 1982, as he signed the Garn-St. Germain Depository Institutions Act.

He was, as it happened, wrong about solving the problems of the thrifts. On the contrary, the bill turned the modest-sized troubles of savings-and-loan institutions into an utter catastrophe. But he was right about the legislation’s significance. And as for that jackpot — well, it finally came more than 25 years later, in the form of the worst economic crisis since the Great Depression.

For the more one looks into the origins of the current disaster, the clearer it becomes that the key wrong turn — the turn that made crisis inevitable — took place in the early 1980s, during the Reagan years.

Attacks on Reaganomics usually focus on rising inequality and fiscal irresponsibility. Indeed, Reagan ushered in an era in which a small minority grew vastly rich, while working families saw only meager gains. He also broke with longstanding rules of fiscal prudence.

On the latter point: traditionally, the U.S. government ran significant budget deficits only in times of war or economic emergency. Federal debt as a percentage of G.D.P. fell steadily from the end of World War II until 1980. But indebtedness began rising under Reagan; it fell again in the Clinton years, but resumed its rise under the Bush administration, leaving us ill prepared for the emergency now upon us.

The increase in public debt was, however, dwarfed by the rise in private debt, made possible by financial deregulation. The change in America’s financial rules was Reagan’s biggest legacy. And it’s the gift that keeps on taking.

The immediate effect of Garn-St. Germain, as I said, was to turn the thrifts from a problem into a catastrophe. The S.& L. crisis has been written out of the Reagan hagiography, but the fact is that deregulation in effect gave the industry — whose deposits were federally insured — a license to gamble with taxpayers’ money, at best, or simply to loot it, at worst. By the time the government closed the books on the affair, taxpayers had lost $130 billion, back when that was a lot of money.

But there was also a longer-term effect. Reagan-era legislative changes essentially ended New Deal restrictions on mortgage lending — restrictions that, in particular, limited the ability of families to buy homes without putting a significant amount of money down.

These restrictions were put in place in the 1930s by political leaders who had just experienced a terrible financial crisis, and were trying to prevent another. But by 1980 the memory of the Depression had faded. Government, declared Reagan, is the problem, not the solution; the magic of the marketplace must be set free. And so the precautionary rules were scrapped.

Together with looser lending standards for other kinds of consumer credit, this led to a radical change in American behavior.

We weren’t always a nation of big debts and low savings: in the 1970s Americans saved almost 10 percent of their income, slightly more than in the 1960s. It was only after the Reagan deregulation that thrift gradually disappeared from the American way of life, culminating in the near-zero savings rate that prevailed on the eve of the great crisis. Household debt was only 60 percent of income when Reagan took office, about the same as it was during the Kennedy administration. By 2007 it was up to 119 percent.

All this, we were assured, was a good thing: sure, Americans were piling up debt, and they weren’t putting aside any of their income, but their finances looked fine once you took into account the rising values of their houses and their stock portfolios. Oops.

Now, the proximate causes of today’s economic crisis lie in events that took place long after Reagan left office — in the global savings glut created by surpluses in China and elsewhere, and in the giant housing bubble that savings glut helped inflate.

But it was the explosion of debt over the previous quarter-century that made the U.S. economy so vulnerable. Overstretched borrowers were bound to start defaulting in large numbers once the housing bubble burst and unemployment began to rise.

These defaults in turn wreaked havoc with a financial system that — also mainly thanks to Reagan-era deregulation — took on too much risk with too little capital.

There’s plenty of blame to go around these days. But the prime villains behind the mess we’re in were Reagan and his circle of advisers — men who forgot the lessons of America’s last great financial crisis, and condemned the rest of us to repeat it.

Financial Journalists Fail Upward

Jim Cramer and Jon Stewart.













OPINION: THE TILTING YARD - MARCH 18, 2009

Financial Journalists Fail Upward

By THOMAS FRANK

"Listen, you knew what the banks were doing and yet were touting it for months and months," said "Daily Show" host Jon Stewart to CNBC superstar Jim Cramer in their much-discussed confrontation last week. "The entire network was, and so now to pretend that this was some sort of crazy, once-in-a-lifetime tsunami that nobody could have seen coming is disingenuous at best and criminal at worst."

The applause Mr. Stewart has received for his j'accuse is the sound of the old order cracking. We have turned on the financial CEOs, inducting them one by one into the Predator Hall of Fame. We have gone deaf to the seductive rhythms of the culture wars. We have tossed out the politicians whose antigovernment rhetoric seemed invincible for so long.

Perhaps overstated in its sweep, the statement is still on target: CEOs are not rock stars any longer. The age of Reagan is over (thank goodness).

And now comes the turn of the bubble-blowers of pop culture, the army of fake populists who have prospered for years by depicting the stock market as an expression of the general will, as the trustworthy friend of the little guy buffeted by a globalizing economy.

Sweeping overgeneralization.

We know -- or we think we know -- about the roles played by other culprits in the debacle. The government regulators, for example: How could they have ignored the coming disaster? Well, they were incapacitated by decades of deregulation. What about the market's own watchdogs? Well, from appraisers to ratings agencies the whole tough-minded system was apparently undermined by conflicts of interest.

Indeed.

But what about the syndicated columnists and the beloved stock pickers and the authors of personal finance best-sellers, the industry for which CNBC is the perfect symbol? How did they manage to miss the volcano under their feet?

Same thing: they would not bite the hand that fed them.

Mr. Cramer, for his part, had the forthrightness to confess his errors and admit his limitations. "I'm not Eric Sevareid. I'm not Edward R. Murrow," he pleaded. "I'm a guy trying to do an entertainment show about business for people to watch."

He pretended, always, to be an expert. He fesses up when he's in deep mud.

But the larger problem won't go away. And it's not just a matter of people missing the biggest economic story of the last 20 years. It's a matter of those who minimized it and those who blew it off because it didn't fit their worldview continuing in their plum positions of authority. Mr. Stewart wasn't rude enough to ask it, but over all his inquiries there hung the obvious question: Why do you still have a job, Mr. Cramer?

If the world of financial infotainment can itself be described as a "market," it is a market where accountability does not seem to exist, where the heaviest of incentives seems to carry no weight, and where consumers, to judge by what they get, seem constantly to choose the lousy over the good. The old order discredits itself, but the old order persists nevertheless.

This needs to be repeated every time someone pleads, "Who could have known?" Plenty of people did see the disaster coming. Most of them were marginalized, however, laboring at out-of-the-way econ departments, blogs and B-list think tanks. They were excluded and even ridiculed because their larger understanding of the economy was not one that fit well with the sort of Wall Street worship preached by the likes of CNBC.

Nor is this a particularly liberal line of inquiry, despite Jon Stewart's well-known fondness for tormenting Republicans. It was a question that interested Milton Friedman, among others, who could be seen musing on the subject in a 1994 TV interview that C-Span chose to rebroadcast on Sunday.

The occasion was the 50th anniversary of the publication of Friedrich Hayek's "The Road to Serfdom." As he looked around him, Friedman marveled at the world's perverse refusal to learn certain lessons, even when history itself drove them home. Everyone had by then learned that government was too large, he said, but countries kept on growing government anyway.

Friedman may have misread the direction in which the world was moving in 1994, but the question he raised is still a good one. Bad ideas and clueless pundits often do get on top, and they stay there -- sometimes hailing incentives and accountability, even -- despite all manner of rebukes handed down by history itself.

The reasons the financial-entertainment biz failed us are many and complex, but they ultimately come down to this: In the marketplace to describe the marketplace itself, there is precious little competition. There is a single, standard product that comes in packaging that is alternately sultry, energetic or fun -- bitter, brainy or Cramer "crazy" -- but which rarely strays beyond certain ideological boundaries. Adversarial voices are few. Criticism is sacrificed for access. Advice sometimes shades over into simple propaganda. Even the worst prognosticators sometimes go on to jobs with presidential campaigns or prominent think tanks.

Everybody repeats the same mantra, over and over.

And the small investors whom the personal-financial industry claims so much to adore remain bystanders in a drama they neither understand nor control.

Fed Chairman Backs Call for Higher Spending

The chairman of the Federal Reserve on Tuesday tacitly endorsed President Obama’s call for huge increases in spending and trillion-dollar deficits over the next couple of years, saying the economic crisis required aggressive action.

Spending, and not tax cuts, will solve the crisis. To believe otherwise is foolhardy and politically demagogic.

Though the chairman, Ben S. Bernanke, did not endorse any of Mr. Obama’s specific proposals, he echoed the president’s call for bold government action to address the economy’s immediate travails and pointedly refused to criticize his longer-term plans.

He can't be stepping into the middle of politics; how I wish other Fed chairmen had been equally prudent.

Mr. Bernanke, a Republican who was appointed by President George W. Bush, provided Mr. Obama and Democratic lawmakers with crucial backing for the political battles ahead. His comments were reminiscent of the support that his predecessor, Alan Greenspan, gave to Mr. Bush’s call for tax cuts in 2001. Many lawmakers in both parties said Mr. Greenspan’s comments had helped override Democratic objections to Mr. Bush’s tax cuts.

Putz. Another bad decision by Greenspan.

Mr. Bernanke, warning that the economy had yet to show hardly any sign of recovery, brushed aside objections by Republicans that Mr. Obama’s plans would lead to a dangerous growth of government.

Politics, and foolishness.

Republican lawmakers tried to draw the Fed chairman into their corner, to no avail. “There is in this budget a massive movement of the government to the left, in other words a massive expansion of the government,” warned Senator Judd Gregg of New Hampshire, the committee’s ranking Republican.

Expansion? Isn't that what Ronald Reagan and George Bush also did?

But Mr. Bernanke simply said that Congress and the White House needed to start thinking now about how to bring the federal budget back to normal.

Recovery first, then, when the signs are clear that the economy is back on track, sure, look to cut spending; but cut too early, and another recession will follow.

Lawmakers in both parties chastised the Fed and the Treasury for providing $30 billion more to the American International Group, the insurance conglomerate that had already received three rounds of government help totaling $152 billion.

As distasteful as it is, the company has to be saved. Once stable, it should be divided up, sold off, and let Hank Greenberg go jump in a lake.

Mr. Bernanke, in an unusually emotional response, criticized the insurance giant as making reckless bets that jeopardized the entire financial system. “If there is a single episode in this entire 18 months that has made me more angry, I can’t think of one,” he said. Saying that A.I.G. had “exploited a huge gap” in the regulatory system, Mr. Bernanke said it became a “hedge fund, basically, that was attached to a large and stable insurance company” and made “huge numbers of irresponsible bets.”

Lack of regulation allowed AIG to become a monster.

A Bold Plan Sweeps Away Reagan Ideas

It is a happy day in America once again. The ghost of the Gipper has been purged.

Copies of the president’s budget, “A New Era of Responsibility.”

The budget that President Obama proposed on Thursday is nothing less than an attempt to end a three-decade era of economic policy dominated by the ideas of Ronald Reagan and his supporters.

And two weeks ago some of us were worrying that President Obama was being bested by Mitch McConnell. Nah!

After Mr. Obama spent much of his first five weeks in office responding to the financial crisis, his budget effectively tried to reclaim momentum for the priorities on which he campaigned.

Paul Krugman was quite complimentary.

His efforts would add to a budget deficit already swollen by Mr. Bush’s policies and the recession, creating the largest deficit, relative to the size of the economy, since World War II. Erasing that deficit will require some tough choices — about further spending cuts and tax increases — that Mr. Obama avoided this week. But he nonetheless made choices.

That agenda starts with taxes. Over the last three decades, the pretax incomes of the wealthiest households have risen far more than they have for other households, while the tax rates for top earners have fallen more than they have for others, according to the Congressional Budget Office.

“The tax code will become more progressive, with relatively higher rates on the rich and relatively lower rates on the middle class and poor,” said Roberton Williams, a senior fellow at the Tax Policy Center in Washington. “This is reversing the effects of the Bush policies,” he added, and then going even further.

Mr. Obama would try to lift the incomes of the middle class and poor through two main channels, administration officials said. The first is an overhaul of health care, meant to reduce the insurance premiums now taking a large bite out of many families’ paychecks.

The other channel is education. Over the last three decades, the pay of college graduates has risen significantly faster than the pay of less-educated workers. Mr. Obama aims to move workers into the first category by increasing federal financial aid and simplifying the myriad of aid programs. In recent years, the United States has lost its standing as the country in which the largest share of young adults graduates from college.

We as a nation simply accepted these trends, out of self-interest, or resignation. Now we have a President who is showing leadership in trying to balance things a bit better for those who are not wealthy and influential.

Chicago rules

Blagojevich is the issue of the day -- or, maybe was, now that an Iraqi pair of shoes have been thrown at President Bush.

The turd tossed by Illinois governor Rod Blagojevich into Barack Obama’s punch bowl had been floating there for 48 hours when the president-elect stepped to the podium at his press conference last Thursday morning. Obama’s initial response to the astonishing—and comical, and nauseating, and DSM-worthy-crazy—corruption case had seemed wan, perfunctory. His call for Blago’s resignation had been issued through a spokesman. But Obama’s handling of the matter at the press conference was more sure-footed. Beyond the substance of what he said, his tone and bearing were pretty much pitch-perfect: saddened, disgusted, denunciatory, not the least defensive. And his oblique reference to being called a “motherfucker” by Blagojevich (“I won’t quote back some of the things that were said about me … this is a family program, I know”) earned him extra points for humor.

It really seems a tempest in a teapot (well, maybe in a fucking teapot). That Blago denounced Obama and his camp for not paying him off seems enough evidence. But, the media needs something to chew over, and that punk remains good copy.

For Obama, one question is whether all this will be damaging or merely distracting. And another is whether Blago’s will be the last grasping, clawlike hand to reach up from the Illinois swamp and try to seize Obama by the ankles.

There seems to be an attempt by some of the media to ignore the murky side of politics, to cast this incident as a besmirching of the otherwise virginal land of politics. Poppycock.

Nobody doubts that Obama was with the reformers in Illinois, both in terms of the legislation he helped pass in the State Senate (including on campaign finance and ethics) and in his philosophical orientation. But Obama was hardly some sort of anti-Establishment firebrand. He is close to the Daleys—Mayor Richard and brother Bill—and Emil Jones, a longtime leader in the State Senate. He assisted Blagojevich in getting elected in 2002, and though they have been estranged for some years, he supported Blago for reelection and refused to condemn him (or Mayor Daley) when they became ensnared in corruption contretemps, a fact that left some reform-minded supporters “feeling alienated and angry,” according to Lizza. And, of course, there was his alliance and friendship with Rezko.

Of course Obama isn't pure. Purity goes nowhere in politics. PTA, school board, library board; any and all organizations require maneuvering, positioning, alliance-building, and more, to be effective, get anywhere, get things done.

In all of this, Obama calls to mind Bill Clinton. Clinton’s various entanglements in the Razorback State’s quasi-feudal political and business cultures came back to haunt him during his time in office, most glaringly in the case of Whitewater.

At first, this seems a stretch. Clinton's wife had a lot of baggage, too: Rose law firm, and so on.

That Whitewater was a trumped-up tin-pot scandal in which WJC was never proved to have done anything illegal is beside the point—or, more accurately, is precisely the point. The investigations Whitewater spawned were more intrusive than a thousand colonoscopies. They consumed countless news cycles, drained away political capital, inflicted horrendous legal bills on dozens of innocent bystanders, and energized the Republicans and their allies on the fringes of society and in the mainstream media. And for what? For nada.

A little reflection, though, shows that it isn't much of a stretch. Whitewater became the hook for a lot of anti-Clinton activism by the extreme right wing. Clinton added fuel to the fire: Hillary didn't want to bake cookies, Zoe Baird hadn't paid nanny taxes, don't ask-don't tell.

Could Blagogate do something similar to Obama? Already one “prominent Chicago Democrat” is telling Politico that the mess poses the risk of “Whitewater-type exposure” to the president-elect. “What will splatter on to Obama is he is to some degree a product of this culture, and he has never entirely stood against it,” said this person.

The contention that it shouldn't matter much, that the problems we face are so immense that minor stuff such as this should not even be on the radar screen misses the point: that is how politics work, and to ignore that is, at best, naive. Yet Obama being from the Chicago machine is not in itself a crime, legal or political. Every politician comes from a machine of one sort or another.

It’s obviously pertinent here that no one is accusing Obama himself of any sort of wrongdoing—quite the contrary. (Equally so that Patrick Fitzgerald is no Ken Starr.) And if it turns out that Team Obama’s hands are clean, the political danger for the incoming administration will be significantly reduced. But even then, it’s safe to assume that any transitionite who spoke to Blago or his chief of staff, no matter how innocently or appropriately, will have to lawyer up in preparation for the forthcoming trial. The GOP is already seizing the opportunity to hammer Obama; they are likely to cling to the slimmest reed in an effort to keep the story alive.

Let one crisis begin, or let one of Obama's initiatives catch fire, and the GOP will have to, and need to, stop appearing obstructionist.

There are no shining cities (or states) on a hill in local American politics. Some are nastier, sleazier, and uglier than others, but none are what you’d properly call pretty. Winning the presidency promises, among other things, an escape from all of that. But few presidents in recent memory have been able to avoid a Michael Corleone moment: “Just when I thought I was out, they pull me back in.” This is the first such moment for Obama. For his sake, and, Heaven help us, for ours too, let’s hope it’s his last.

American, or any other, politics has no shining cities on a hill. That Reaganite metaphor is, and always was, nonsense. Reagan had dead Marines in Lebanon, voo-doo economics, ballooning deficits, and Irangate. His myth is based on ideological loyalty from, and the stupidity of, his supporters.

This will not be Obama's last major administrative problem. That is not the challenge (to avoid such problem); the challenge is to handle them properly.

What Do We Do Now?

77 days to get ready to govern. In normal circumstances, 11 weeks would seem enough to get started. These are hardly normal times. Still, Obama has already started, surely; if he is anything, he is an organizer, a planner.

This new book seems an interesting one:What Do We Do Now? by Stephen Hess (Brookings, 174 pages, $16.95).

Scholars generally consider Ronald Reagan's transition the gold standard, while Mr. Carter's and Bill Clinton's are case studies in how not to do it. Reagan proceeded magisterially, with staffing overseen by Ed Meese, policy planned by the Heritage Foundation and logistical support provided by Bill Brock, "the most creative Republican national chairman since Mark Hanna," in Mr. Hess's words.

Interesting that the Heritage Foundation planned policy; that makes it more than just a think tank. It makes more a quasi-governmental organizational, even an extension of government.

Mr. Carter was determined to be the opposite of Nixon, who had brought in Washington legend Bryce Harlow and other members of the Establishment to smooth his transition. So Mr. Carter turned to his "Georgia mafia." He made the disastrous decision to appoint as his congressional liaison Frank Moore, a man whose legislative lobbying had been limited to Atlanta.

Carter made it his business to alienate official Washington.

Bill Clinton admitted in his memoirs that he spent so much time "micromanaging the cabinet appointments" that he only got around to naming his White House staff six days before his Inauguration. The result was a chaotic first few months in which his big-ticket agenda was sidetracked by the debate over gays in the military.

Poor, if any, planning, seat-of-the-pants (or back-of-the-envelope) managing, and poor execution. A trifecta.

Mr. Hess warns against what he calls the Contrariness Principle. JFK summarily disbanded Ike's National Security Council only to find himself, three months later, without any functioning structure during the Bay of Pigs crisis.

Obama isn't going to repeat that sort of mistake; he has old Kennedy hands available, and has consulted them.

Mr. Carter got rid of the "Berlin Wall" that H.R. Haldeman and John Ehrlichman were supposed to have built around Nixon and ended up getting personally involved in decisions about who could play on the White House tennis court.

Obama seems to know how to delegate. And his game is basketball, anyway.

And Mr. Clinton, eager to demonstrate that the abrasive zero-tolerance administrative style of John Sununu was a thing of the past, installed his old buddy Mack McLarty, whose talents were considerable but (as he himself protested) did not include administrative organization.

In an ironic twist, Obama is tapping an old Clinton hand, Emmanuel, as his chief of staff.

Perhaps "Brownie, you're doing a heck of a job" banners should hang in every transition office – reminders that Michael Brown's qualification for being appointed head of the Federal Emergency Management Agency in 2003 was having served as the Judges and Stewards Commissioner for the International Arabian Horse Association.

How the hell did he ever get an appointment of any sort? Perhaps this example is illustrative: Paul O'Neill, the Treasury secretary from January 2001 to December 2002, told Mr. Bush and Dick Cheney that he disagreed with vital elements of their economic policies and added that he wouldn't be comfortable in a subordinate position after having been Alcoa's chief executive. They both laughed, and Mr. Bush said: "We know all that stuff. Doesn't matter. We want you to take the job." Mr. Hess writes: "What is so stunning about this mistake is how totally self-inflicted it was."

So why did O'Neill take it, anyway?

Brace yourselves – George Bush will soon be free to do just what he wants

We are about to enter the twilight zone, that strange black hole in political time and space that appears no more than once every four years. It is known as the period of transition, and it starts a week from today, the time when the United States has not one president but two. One will be the president-elect, the other George Bush, in power for 12 more weeks in which he can do pretty much whatever he likes. Not only will he never again have to face voters, he won't even have to worry about damaging the prospects of his own party and its standard bearer (as if he has not damaged those enough already). From November 5 to January 20, he will exercise the freest, most unaccountable form of power the democratic world has to offer.

A scary thought. And, why did they do it?

A former official in the Bush administration confirmed to me yesterday that the US has lunged into Syrian territory several times before: it's just that Damascus chose to keep quiet. In which case, the interesting question is why the Syrians went public this time.

This was a deliberate act, calculated to send a series of messages. First, to the Syrians, reminding them who's boss in the region and strong-arming them to do more to crack down on al-Qaida.

Second, to the Europeans who have been moving towards a rapprochement with Damascus. Nicolas Sarkozy may have invited President Assad to Paris and David Miliband may have been hosting the Syrian foreign minister, Walid al-Muallem, in London this very Monday, 24 hours after the raid - but no matter. Bush gets to remind both these uppity Europeans who's in charge.

Third, the president could have been sending a message to his own administration.

However we are meant to read it, the attack on Syria looks a lot like a parting shot from Bush, an end-of-the-movie reminder of what this long and bloody saga has been about. A small operation, causing eight deaths, it nevertheless captures much of the Bush ethos that has ruled the globe these past eight years. It was unilateral; it trampled on state sovereignty; and it relied on force as a first, not last, resort. As a souvenir of the Bush era, it would be hard to top.

Bush may be thinking of a parting gift more in keeping with the record of the last eight years. He and Cheney might decide, what the hell, we have one last chance to whack Iran - and let the new guy clear up the mess. Not likely, but possible. For in the twilight zone, anything can happen.

A paean to Liberalism

Bob Herbert consistently writes excellent columns. This is a good example.

Ignorance must really be bliss. How else, over so many years, could the G.O.P. get away with ridiculing all things liberal? Troglodytes on the right are no respecters of reality. They say the most absurd things and hardly anyone calls them on it. Evolution? Don’t you believe it. Global warming? A figment of the liberal imagination.

O'Brien, Sean Colmes, Coulter and Limbaugh scream and insist it is all liberal imaginings, and that makes them unpatriotic sentiments.

Liberals have been so cowed by the pummeling they’ve taken from the right that they’ve tried to shed their own identity, calling themselves everything but liberal and hoping to pass conservative muster by presenting themselves as hyper-religious and lifelong lovers of rifles, handguns, whatever.

And liberals cower.

Why liberals don’t stand up to this garbage, I don’t know. Without the extraordinary contribution of liberals -- from the mightiest presidents to the most unheralded protesters and organizers -- the United States would be a much, much worse place than it is today.

Indeed.

Civil rights? Women’s rights? Liberals went to the mat for them time and again against ugly, vicious and sometimes murderous opposition. They should be forever proud. The liberals who didn’t have a clue gave us Social Security and unemployment insurance, both of which were contained in the original Social Security Act. Most conservatives despised the very idea of this assistance to struggling Americans. Republicans hated Social Security, but most were afraid to give full throat to their opposition in public at the height of the Depression.

Some have never stopped hating FDR.

When Johnson signed the Medicare bill into law in the presence of Harry Truman in 1965, he said: “No longer will older Americans be denied the healing miracle of modern medicine.” Reagan, on the other hand, according to Johnson biographer Robert Dallek, “predicted that Medicare would compel Americans to spend their ‘sunset years telling our children and our children’s children what it was like in America when men were free.’ ”

That last quote is the one Palin, the last of the conservatives who venerate Reagamn and lie to the people, used, but entirely out of context. Of course.

Palin’s Alternate Universe

As usual, Herbert is spot on.

In her closing remarks at the vice-presidential debate Thursday night, Ms. Palin referred earnestly, if loosely, to a quote from Ronald Reagan. He had warned that if Americans weren’t vigilant in protecting their freedom, they would find themselves spending their “sunset years telling our children and our children’s children what it was like in America when men were free.”

What Ms. Palin didn’t say was that the menace to freedom that Reagan was talking about was Medicare. As the historian Robert Dallek has pointed out, Reagan “saw Medicare as the advance wave of socialism, which would ‘invade every area of freedom in this country.’ ”

She quoted the Gipper more than once. Reagan remains the patron saint that conservatives evoke, citing mythology as a panacea. Yet Reagan is the one who started all this mess.

Where is the evidence that Governor Palin even understands these complex and enormously challenging problems? During the debate she twice referred to General McKiernan as “McClellan.” Neither Ms. Ifill nor Senator Biden corrected her.

Are we French and Socialist?

The financial crisis has raised many issues. Two of the more pressing issues for some folks are our national and economic identities. Are we French, or American? Are we capitalists, or socialists?

Senator Richard Shelby, who used to be a Democrat and became a Republican, and who was and is from Alabama, wonders about our identity.

GOP's Shelby Leads Conservatives Against Bailout As a Republican, Mr. Shelby would normally be the one to defend a Republican president's policies. Instead, he's the leader of a mounting chorus of conservatives who think President George W. Bush has sold out conservative principles. "I think we're going down the road of France now," Mr. Shelby told one television interviewer Tuesday, before quickly adding, "in all due respect for my French friends."

With all due respect. Of course. Yet, just how salt-of-the-earth does the Senator remain?

The son of a Birmingham steelworker, Mr. Shelby, 74 years old, remains true to his Southern roots. At the same time, he has adapted to the culture of Washington, securing huge amounts of money for his state and developing a taste for opera, among other things. His wife is a professor at Georgetown University.

Just how true, and to what roots?

Another American is skeptical, even angry, about all this identity business. He made a bundle on Goldman Sachs stock, then got a bad taste about it, and is making his feeling known.

You would think that would count as a pretty good paycheck for the Houston energy trader. Instead, the experience left him so angry about the demise of capitalism that he says he has decided to spend his profits on advertisements attacking President George W. Bush's planned $700 billion Wall Street bailout.

His ad explaining his ire appeared in yesterday's NY Times.

"I see it as trickle-down communism," Mr. Perkins said. "We have a communist action where everybody is paying for the benefit of the few and hoping the benefits will trickle down to everyone else."

I thought that was Reaganomics. A, well.

If It's Not by Tolstoy, Hold On to Your Rubles

Libraries remain valuable social institutions, though their roles are changing. Many people think of libraries as "free internet access" or "free wi-fi" and couldn't care less about books, though many people think of libraries as places to socialize, to get books and DVDs, and to go to merely as a destination.

I was shocked a couple of years ago when I learned a fellow worker with small children didn't know where the neighborhood branch of the local public library was. Turns out any time his kids wanted a book, he went out and bought it for them. Same for his own reading.

This is one of the big changes of the last couple of decades: B&N as a destination, a place to look at books, to socialize. Part of it is a generational change: people in their twenties got used to getting an expensive cup of coffee and hanging out at the bookstore. Another part is institutional: libraries did not change enough to stay popular with newer generations. Yet another part is simply progress, change, the tide of social history: libraries and librarians are not highly regarded, libraries seen as stodgy places one has to be quiet, to follow rules, and to do as one is told, librarians as overbearing women who are quick to reprimand and slow to warm up.

Ever since I was a little boy, we made regular visits to the library, where I would sate my reading passion of the moment. Robert Louis Stevenson's works, the now largely forgotten Henry Ware novels of Joseph A. Altsheler, the Bruce Catton histories of the Civil War – I read them all.

B&N became part of the culture of acquisitiveness, of displaying one's ability to spend, what I'd call the Reagan culture.

Uncle Joe, the Czar, or the Empress

In the land of Czars, an online poll turns up interesting results.

In the land of Tolstoy and Tchaikovsky, an online poll to identify Russian history's "greatest heroes" has two early front-runners: autocratic Czar Nicholas II and dictator Josef Stalin.
That in itself is interesting: both were strongmen, arbitrary rulers with absolute power, and both, clearly, are objects of nostalgic longing for how things used to be. Of course, the dark side of their rules is forgotten, glossed over, or ignored. Under Nicholas many Russians were serfs, under Stalin many Russians were dead.

Catherine the Great, Yuri Gagarin, Czar Nicolas, Stalin.

But this is interesting: "He's like a brand. It's like Coca-Cola," says Alexander Lyubimov, a senior executive with Rossiya TV, the state-controlled broadcaster behind the "Name of Russia" contest.

A brand? As in 'things go better with Uncle Joe'? Oy vay.
The vote has fired people's imagination at a time when the Kremlin is trying to reclaim parts of its Soviet and Czarist past to forge a new nationalism. But as early results have shown, finding suitable historical heroes in a country with a centuries-old tradition of authoritarianism is complex. Elsewhere, the task was less fraught. In the U.S., a similar contest chose Ronald Reagan; in Britain, Winston Churchill; and in South Africa, Nelson Mandela.

Just goes to show how short-sighted and forgetful Americans can be.

Nicholas II's narrow lead comes as monarchists prepare to mark the 90th anniversary of his execution by the Bolsheviks. Mr. Lyubimov says Russia's last czar is unlikely to win. Though Nicholas II is revered by the Orthodox Church, which canonized him, his detractors say his reign was marred by anti-Semitic pogroms, two disastrous wars, a civilian massacre and the near-collapse of the country.

Seems ole Nick wasn't adept at ruling his nation.

And this summary: For much of the Soviet period, there was little examination of the darker side of his rule. This only began in earnest in the twilight days of the Soviet Union under Mikhail Gorbachev and in the early 1990s when human-rights groups began talking about Stalin's millions of victims.

Sort of a sound-bit interpretation of history: Khrushchev began the exposure of Stalin's horrors, Solzhenitsyn wrote a great deal about those horrors, and Sakharov and other dissidents continued the movement, yet it is all ascribed to Gorbachev. Too simple.

Conservatives and Their Carnival of Fraud

How did this guy get on the op-ed page of the Wall Street Journal?

...call into question one of the greatest shibboleths of conservative governance. Although contracting-out has been celebrated by big thinkers from both parties and although it has been practiced in some form or other since the earliest days of the republic, an ideological commitment to outsourcing is one of the signatures of conservative rule.

And a bad, wasteful and dangerous one.

The ostensible justifications for it, in the early days, were thrift and efficiency. The 1984 "Grace Commission," in which a battalion of corporate executives ransacked the government looking for waste, recommended privatizing federal operations as a way to save money. With the government plunged deep into deficit, government needed to hire out its duties to business in order to save itself. The ideological assumption was only barely concealed: Whatever "big government" could do, the private sector could do better, cheaper and faster.

And outsorced to friends and cronies, say, as in Halliburton.

Privatization also constitutes a fundamental change in the constituency to which government answers.

Exactly; it is anti-democratic.

It is time for a new Grace Commission, this one examining the sordid history of privatization in all its details. President Barack Obama should launch it on day one.

Yup, I read this in the Journal. Amazed, I emailed the dude:

Very well said, dude!

Reaganomics is one of the greatest frauds ever perpetrated, and its effects went beyond federal budget deficits ballooning to heights never seen before in history. It was Ronald Reagan who labeled government an enemy of the people. As a result, neoconservatives were emboldened to outsource governmental functions, to slash government programs that could not be outsourced to their friends, allies and cronies, and to call for government to be run as a business.

Where is J. Peter Grace now, anyway? And is his company out of Chapter XI bankruptcy?

I sure hope, along with you, that President Obama appoints a Commission of Governmental Services (or some such) in his first week in office? Wonder what his email address is, anyway; maybe you/we could send him the idea.

Right on, dude.

Sal Weir
Flushing, NY