Sunday, February 17, 2013
One of the great things about American politics is its capacity for punishing hubris.
For the ancient Greeks, hubris didn't merely describe god-like arrogance. It was a crime, usually defined as taking too much pleasure in the humiliation of your foes. In its modern usage it usually means the pride that comes before the fall.
In the wake of Barack Obama's State of the Union address, both connotations seem at least a little apt. We are well into our fourth month of epidemic thumb-suckery over the question, "Are the Republicans doomed?" The latest New York Times Magazine asks, "Can the Republicans Be Saved from Obsolescence." The wished-for answer doesn't require much reading comprehension.
Since the election, a slew of political reporters and analysts -- never mind the self-declared Obama boosters -- have argued that Obama will, must or should crush his enemies (and by enemies, I mean the Republicans). Slate's John Dickerson wrote that if Obama "wants to transform American politics, he must go for the throat."
"Obama's only remaining option," Dickerson continued, "is to pulverize. Whether he succeeds in passing legislation or not, given his ambitions, his goal should be to delegitimize his opponents."
Many conservative observers agreed. Michael Barone wrote, "Obama begins his second term with a strategy to defeat and humiliate Republicans rather than a strategy to govern." Rich Lowry, my boss at National Review, wrote that Obama's approach to the debt-ceiling fight should have been called "Operation Humiliation."
That strategy worked for Obama, he figures, so why quit now? His second inaugural address was a frilly campaign stump speech, dividing fools and devils (Republicans) from the wise and the sainted (Democrats).
His State of the Union address, already fading from the mind's eye like the afterglow of a flashbulb, showed that Obama remains committed to his hammer-and-tongs style. His ludicrous claims that massive new expansions of government won't add a "single dime" to the deficit -- technically true, since they would add trillions of dimes to the deficit -- alone made it clear that he's still in campaign mode.
Obama and many in his chorus remain convinced that, after that momentary hiccup known as the 2010 midterm elections, America is finally on a glide path to the new progressive era they'd long been promised.
This is where the two meanings of hubris come together. Liberals panting after the transformative Obama presidency are only seeing what they want to see. The GOP suffered from the same sort of wishful thinking when Republicans believed that George W. Bush -- and Ronald Reagan before him -- signaled a partisan realignment.
Look closely at Obama's State of the Union address, and you see not a progressive colossus poised to conquer all in his path, but a mostly spent force, desperately trying to figure out how to get anything done at all. His main policy ambition was to keep from getting the blame for his own idea: the sequester.
But the emotional heart of the State of the Union comprised three issues: immigration reform, climate change and gun control. Well, as Senate Democrats have made clear, the only way immigration reform passes is if Obama stays out of the process entirely.
On gun control, all Obama is asking for is a vote. He's not even asking for passage of a largely ludicrous assault weapons ban. Why? Because gun control is a wedge dividing Democrats, not Republicans.
So is climate change. Liberal donors want Obama to kill the Keystone pipeline (which Obama failed to mention) and push a green agenda. The union and blue-collar base want good jobs and cheap gas. Indeed, while climate change and gun control may be imperatives for the editors of the New York Times, they are pretty low priorities for Americans growing increasingly nostalgic for economic growth Obama can't deliver. How can it be springtime for liberalism when liberalism's top priorities aren't the public's top priorities?
The remainder of Obama's agenda was fairly pathetic boilerplate. Hike the minimum wage! Redesign America's schools! Manufacturing hubs! Make-work programs!
This is supposed to be liberalism reborn? Lame ideas cribbed from a playbook with 60 years of dust on it? Slogans hatched by pols who needed a few more nouns to round out Obama's sentences? Legislative initiatives that will cost Democrats seats in 2014 and beyond?
Obama's State of the Union had the lowest ratings in 13 years for a reason -- and it's not that America is excited for a new golden age of liberalism. The momentum Obama feels is the pull of gravity, as he starts his fall.
Default must be avoided at all costs and should not be an option on the table?
Will U.S. government one day simply refuse to pay what it owes people who have lent it money?
This is from Jason J. Fichtner and Veronique de Rugy, "The Debt Ceiling: Assets Available to Prevent Default," January 25, 2013.
What's their reasoning? Here is the full extent of it:
"Raising the debt ceiling without a commitment to improve our long-term debt problem has adverse consequences as well. Recently, the rating agency Fitch warned the US government that while it wants the debt ceiling to be raised, it also wants the government to come up with a credible medium-term deficit-reduction plan."
Without it, the agency could downgrade the US credit rating by the end of this year. Other rating agencies have also warned the United States of the negative consequence of not dealing with the country's long-term debt.
The rest of the article is about how to avoid default, not whether it's a good or bad idea.
I'm unconvinced. The U.S. government has dug itself a deep hole. Commitments that it has made to various people must be broken. There is no plausible way, for example, that the U.S. government will be able, 20 years from now, to pay for all the Medicare, Medicaid, and Social Security benefits that it has committed to pay. One such commitment to consider breaking is the commitment to pay the debt.
Bruce Bartlett, in The Benefit and the Burden, his book about taxes, writes that default "would constitute a grossly immoral theft of trillions of dollars from those who loaned money to the federal government in good faith." In my review of his book, I commented, "Really? It's worse to default on creditors who took a risk than to forcibly take money from taxpayers who have no choice?"
Now you could argue that the commitment to pay the debt deserves a priority because of part 4 of the 14th Amendment to the U.S. Constitution, which says:
"The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void."
I take the U.S. Constitution seriously. But note that Fichtner and de Rugy don't make an argument based on the Constitution. Their argument is based on the economics--and, as I noted, I don't think it's that persuasive. To lay out why default might be a good idea takes too much space here. If you want to see a sustained case for default, see Jeffrey R. Hummel, "Some Possible Consequences of a U.S. Government Default," Econ Journal Watch, January 12, 2012.
Fichtner and de Rugy write that it is "irresponsible to signal to the international community that a default on the debt obligations owed by the US government is possible while Washington works through whether it will raise the debt limit before or after it formulates a plan to reduce government spending."
But I think it's irresponsible to tell people that there is unlikely be a default. I'm planning my financial future on the idea that there's a substantial probability that the U.S. government will go right up to the big financial cliff and then default and limit Medicare, Medicaid, and Social Security. The earlier we prepare, the better.
Word has come of a gruesome accident in the Canary Islands. A cruise ship anchored there staged a test of its lifeboats, and five crewmen died. At the moment, the cause is said to have been a break in one of the cables by which lifeboats are lowered to the water. A picture shows a capsized lifeboat next to the ship. The dead crewmen were trapped beneath it.
This is sad, but why is it of any more interest than any other industrial accident? Because lifeboats are constantly hailed as a solution, not a cause, of naval disaster.
The 101st anniversary of the sinking of the Titanic arrives on April 14. We will hear a great deal about the importance of government regulations to ensure that every ship has enough boats for its whole company of passengers and crew.
Since the Titanic, this kind of regulation has been in effect. But as with most regulations, the effects have been mixed, to use a conventional kind of understatement. When American total-lifeboat regulations came in, two things happened. One was the ruin of America’s passenger steamship lines to the Orient. The owners couldn’t afford to meet the new standards (which, admittedly, included labor-protectionist provisions only notionally connected with safety). The other was the sinking of the steamship Eastland. The Eastland capsized in the Chicago River, with immense loss of life, because it had been overloaded with lifeboats.
The Eastland before it rolled over
The story of the Eastland is ably presented by George Hilton in his book on the subject. I myself have analyzed the lifeboat issue in my book about the Titanic. I’ll hit some high points:
Only one large passenger ship has ever been evacuated solely by its own boats, and that was a vessel in which almost all the passengers and crew were under military discipline. If a large ship gets into trouble, it ordinarily sinks right away (as did the Lusitania, with horrible results from the attempted launching of lifeboats), or it takes days to sink. In the first case, few boats will probably be capable of successful launch (even the Titanic used remarkably little of its available lifeboat space). In the second case, other ships will appear to take people off the stricken vessel, if that vessel is anywhere near normal lines of travel.
It is a fearful thing to enter a lifeboat and be lowered 50, 60, or 70 feet into an ocean that is probably cold and turbulent. Usually, it’s better to stay with the ship. If the passengers on the Costa Concordia, which suffered a disastrous mishap off the coast of Italy in January 2012, had understood this, they would not have panicked, and they would have sustained fewer deaths. Instead, they remembered propaganda about the Titanic and concluded that they were doomed, because their lifeboats were not efficiently launched. In some cases, they jumped off the ship, and died.
By the way, the Costa Concordia never sank. It’s still there, lying on its side, along the coast of Italy. If you were a passenger without an operative lifeboat, you could still be living on board. Yet watching the one-year retrospectives on this event, one would think that the ship had sunk — and passengers had died because lifeboats were not available.
The truth is that everything people do, or plan to do, has its own risks. Even tests of government-mandated rescue equipment can go wrong, terribly wrong. There is no such thing as a free lunch, or a free rescue, either. Let’s end the pious pretense that there is.
Obama’s reactionary jobs plan: "Does it bother anyone else that the president of the United States seems to believe that our collective future entails assembling battery parts in a government-subsidized factory for $9 an hour? Is that really what Americans envision for their kids -- an assembly line? Because when you look past Barack Obama's mesmerizingly hollow rhetoric, what he's proposing is a return of jobs that progress and prosperity have left behind."
How will ObamaCare affect Health Savings Accounts?: "If you are one of the more than 22 million people enrolled in a Health Savings Account (HSA) or a Health Reimbursement Arrangement or if you work for the one of every two employers who now offer one of these consumer-driven health plans, in the future you will have fewer options. The new healthcare law does not outlaw HSA-eligible plans, but it takes away HSA options and future regulations could make these plans impractical and undesirable."
America: Extorting data access: "U.S. law enforcement wants companies to covertly install so-called computer back doors in the software they produce. This would allow the government to access information on any computer using the software without being detected and without going through an authentication process that protects privacy."
Mail delivery should be privatized: "The U.S. Postal Service announced last week that it intends to end Saturday mail delivery beginning Aug. 1. The move would save the government's beleaguered mail monopoly $2 billion a year, according to the USPS. The USPS has lost over $40 billion since 2006 and it has maxed out its $15 billion line of credit with the U.S. Treasury. With mail volume in permanent decline, the USPS has no choice but to try and cut costs. ... With the USPS literally on the verge of not being able to pay its bills in full, it will be interesting to see if Congress finally relents. Even if Congress does allow the USPS to drop Saturday mail delivery, the postal service faces a bleak future."
Elite Iranian general assassinated near Syria-Lebanon border: "A senior commander of Iran's elite Revolutionary Guards has been killed while travelling from Syria to Lebanon, according to Iranian authorities. A man identified as General Hassan Shateri was reportedly assassinated by what Iranian officials described as 'the agents and supporters of the Zionist regime' while travelling from Damascus to Beirut."
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Posted by JR at 12:07 AM