The New Republic

So Obama had to distance himself from just about every black man in America who said something weird or offensive to the Home Depot crowd. So where is Steele on Limbaugh? Limbaugh referred to the President today as "Barack Ogabe". Have we heard anything from Steele, McCain, or any other leading figure in the GOP? What a bunch of cowards.

- fougasseu

March 24, 2009 at 9:53pm

Hopefully, Obama is consistent only up to the point where being consistent is imprudent.

In other words, you seem to be suggesting that policy continuity is more important than....common sense? Or, perhaps, is more indicative of character and integrity?

Instead, as a pragmatist, Obama should always stress the precarious relationship between "my policy today" and the ever shifting and changing parameters of "here and now". In my view, he should strive to make it clear that if something doesn't work, he will try something else. And that he is not tied down to some intractable ideological, moral or political agenda.

What is far more important [at least to me] is a willingness to state goals [improved health care, better education, a sensible energy policy etc] while acknowledging how problematic the accomplishment of this might be.

There are only so many slices of pie. But some slices...an obscene defense department budget, agriculture subsidies, pork, misplaced fiscal priorities etc...can be shifted over to programs that spread government spending over a much wider swath of the population.

george walton

- iambiguous

March 24, 2009 at 10:16pm

Was it just me or did the press seem more partisan and shallow than in the past?  So many of the questions were argumentative or fawning (as much in tone as substance).  Obama looked good simply in comparison.

- Lymon1

March 24, 2009 at 10:26pm

Unfortunately the press is so in love with it's wonder boy that it will take a while for them to understand that the prince is a frog.

But the day will come: many trillions dollars after, after feeding the monster until the point of explosion, after borrowing from the Chinese 100 years of revenue, after compromising every possibility of moral, political and economic recovery, you'll understand...

Now one can only be silent now it seems... The learning will come...

- luispc

March 25, 2009 at 3:25am

I have great doubts on Obama's consistency. Crossposting:

Even I was being convinced (i.e., fooled) by yesterdays lovely speech (the man surely knows how to throw a speech). Until the point something crossed my mind.

Howcome the same man that backs the Geithner plan is the guy that pretends to build a new mentality in which self-interests do not prevail and a new paradigm of growth not based on "maxing your credit cards"...

Indeed, what is he "saving" the financial sector for (with one trillion dollars, no less)? An artificially fed financial sector will thereafter feed on what?

On productive activities and energy renewal? Or on financial schemes that only work if Mr. Ordinary Joe  maxes his credit card to ruin and commits himself with mortgages that not even his grandsons can or will pay?

Who will pay those 1 trillion dollars to make it "profitable" for the taxpayer... Will it not be... the taxpayer by drowning in debt ("maxing his credit card")?

And in the meantime (I'm quite sure those 1 trillion are going down the toilet, since there are very few Average Joes around who are not broke already...) who is making that 1 trillion  happen... The Chinese by buying dollars, feeding a deficit that will make it impossible for anyone to thing about new paradigms in the immediate future...

So if Obama really does mean what he says on a new mentality and a new paradigm of growth he is surely beginning with the wrong foot... Worst of all, he is beginning with a move that creates a wall between the present situation and that new paradigm...

- luispc

March 25, 2009 at 9:21am

Luis, you're whipping yourself up into an interesting pseudo-philosophical lather.  Between you and Georgie boy, Talkback is fast descending into Dada land ...

To wit: "Howcome the same man that backs the Geithner plan is the guy that pretends to build a new mentality in which self-interests do not prevail and a new paradigm of growth not based on "maxing your credit cards"..."

I like that "pretends".  For a man who talks about how we are shaped by ideologies, you sure know how to predispose your arguments.  Of course, the question itself is daft and what follows is even more ludicrous - demonstrating as minimal an understanding of the modern economy as Marx did of capitalism and European history.

For one thing, even if you are trying to build something, you have to bear in mind that, as Derida put it, you are always-already within an existing framework.  You can try, like the French revolutionaries, to burn everything down and try to rebuild - and the result is manifest: three more revolutions, a Commune, five Republics, Vichy, four monumental defeats, etc; you can try, like Hegel, to will history at an end, and you end up with the Triumph of the Will; or, you can take things as they are, and even as you try to change them, ensure that the edifice stays standing.

For another, an individual maxing its credit card and a country going into debt in support of rebuilding that edifice are slightly different in character - and, frankly, if you cannot quite comprehend how one can tut-tut the maxing of credit cards while running a deficit in the middle of a depression, then the conversation will be a short one, indeed.  But more important, the problem - the big problem - with maxing credit cards on consumer spending is its ephemeral nature; the trillion dollars being spend on propping up the financial sector (and you speak as if you have never run a business - so trust me when I tell you this: "credit" is lifeblood to small businesses that are the backbone of every economy except that of Russia and Iran; without credit, business can't survive; with credit, it has a chance, though not guaranteed; that is why you need to prop up the financial sector) is not expenditure as such but investment in the most fundamental infrastructure of the nation: its money and credit supply.

As for the doomsayings and fearmongerings and philosophical bafflegab, bear in mind that in Canada, in 1993, nearly a third of the national budget was going to pay interest on the national debt and Canada's debt to GDP ratio was about 80% - higher than any industrialised country other than Italy and Belgium, and they don't count.  Now, the ratio stands at under 30% and the interest payments on the debt are minimal; this year's stimulus deficit is being financed entirely domestically and so the interest payments are in themselves a recirculation of national wealth in the economy.  In 1993, the NYTimes and the Journal declared Canada the Northern Mexico; now, our economy and the banking sector is the envy of the industrialised world.  All this to say, chill, man.  Things are bad but, thankfully, there is a steady hand on the tiller and, thankfully neither he nor his advisors are easily distracted by the crappola being served by the punditocracy and skeptics like you.

- icarusr

March 25, 2009 at 10:12am

First of all, thanks for the lovely compliments Icasrur. You are inspired, today (though this fixation on George and me is starting to sound repetitive).

Yes I have a slight notion that contemporary economies depend on credit.  I don't like it though.

And it seems your President doesn't like it either or he wouldn't have talked last night about a paradigm of growth based on "maxing you credit cards" (His words, not mine...) to be "overcomen"...

Indeed, I got the idea that he intended to build an economy based on education and on productive activities (like energy and stuff). Meaning: to break to the logic of spending into ruin ("maxing your credit cards") while having an appearence of growth.

It was something of the sort, wasn't it?

My problem (and the point has to do with his consistency, since Mr. Cohn is saying that Obama is impecably consistent) is that he is simultaneously backing a plan that will feed the financial sector with one trillion dollars, hoping that that money will be one day recovered by the tax payer ... And my question is a very simple one: how will the financial sector feed itself in order to turn that one trillion -- now being borrowed from the Chinese -- into an American reality recovered by the American taxpayer?

My guess, is that the financial sector will do what it does (you can't ask a scorpion not to be a scorpion...): it will create "financial instruments". In other words, which are more truthful, it will create debt and more debt and more debt, hoping that people will "max their credit" (credit cards and other means)...

So, assuming that I'm right the Geithner plan cannot (absolutely cannot) be the first step to build the kind of "new world" Obama was envisioning last night (a world in which people do not follow exclusively their self-interests, engage in productive activities and don't max their credit cards) .

On the contrary: such a plan means the perpetuation of the paradigm Obama supposedly was rejecting last night...

Nothing of what you said makes me believe otherwise.

And on Hegel and "Triumph of the Will", you're wrong. But let's leave that for another day.

- luispc

March 25, 2009 at 11:13am

this tidbit from www.nytimes.com/.../congress-passes-wide-ranging-bill-easing-bank-laws.html I read after my last post highlights my basic argument:

''Scores of banks failed in the Great Depression as a result of unsound banking practices, and their failure only deepened the crisis,'' Mr. Wellstone said. ''Glass-Steagall was intended to protect our financial system by insulating commercial banking from other forms of risk. It was one of several stabilizers designed to keep a similar tragedy from recurring. Now Congress is about to repeal that economic stabilizer without putting any comparable safeguard in its place.''

- GSpinks

March 25, 2009 at 1:26pm

"And it seems your President doesn't like it either or he wouldn't have talked last night about a paradigm of growth based on "maxing you credit cards" ... I got the idea that he intended to build an economy based on education and on productive activities (like energy and stuff)."

First, I am not American, never have been, never will be; he's not my president.  Sadly, or fortunately, whatever the White House does affects the rest of us in the civilised world, whether we like it or not ... hence the interest.

As for your observation ... all I can say is, oh dear.  Credit card credit is, you know, different from business credit that I was talking about in my post, that Obama was talking about in his speeches, and that the business sector needs.  Credit, in the sense I was talking about - in the sense that the economy needs - has been with us since, well, oh, I don't know, at least, HAMMURABI, of the Code and the Stele, when he regulates interest payments.  Then, as now, the issue was not about "maxing out credit cards" but, as I found out when I helped my immigrant father set up his business twenty three years ago (a business that put two of his own children and several children of his employees through university), credit - business credit - is the lifeblood of a business.  He needed credit to buy inventory, and to maintain inventory; when he changed locations, he needed credit to rent out and renovate his new premises; in lean times, he needs credit to pay his employees - instead of firing them; and so on.  This is not about "maxing out credit cards" - it is so far from it, that it takes a uniquely delusional person to conflate the two.

And this year, when credit dried out, when my father had to move (after twenty years) and change distributors, he faced either bankruptcy, shutting down his business (and throwing everyone onto the dole) or ... relying on his children to act as bankers of last resort.  The overall economic impact is that instead two sets of expenditures this year (his renovations and mine at home), because I gave him all I had, there will be only one set - his (which are necessary for running his business; mine are aesthetic only).  Right there, in that single microcosm, you can see that the unavailability of credit - business credit, not credit cards, which we both have and which neither of us uses - simply halves the expenditures in the economy.  Expand that to the general economy, and you can see how the economy contracts.

And so, yes, it is possible to be against maxing credit cards and FOR maintainance of sounds financing for businesses.  Your observation, "such a plan means the perpetuation of the paradigm Obama supposedly was rejecting last night..." arises out of a serious and fundamental misunderstanding of basic market, economic and business principles.

- icarusr

March 25, 2009 at 1:33pm

"And so, yes, it is possible to be against maxing credit cards and FOR maintainance of sounds financing for businesses. "

Through giving 1 trillion to the financial sector expecting returns?

Let's see. Hope you're right.

- luispc

March 25, 2009 at 1:54pm

luis: "Yes I have a slight notion that contemporary economies depend on credit.  I don't like it though. "

I don't think there's much I can add to what Iccy has already said, but this line says it all to me.

Luis, please do enlighten us with your preferred economic model that doesn't depend on credit.  And just to clarify - have you ever run a business (excluding self-employment obviously) that did not depend on credit?

- Nari224

March 25, 2009 at 3:25pm

I'll try to use an analogy: oil.

I have a sligtht notion that contemporary economies depend on oil. I don't like it though.

And if there is a problem of oil shortage after the oil companies have ruined themselves in casino like businesses, what will I do? Give them a trillion dollars and carte blanche to drill wherever they want and simultaneously make a speech on how the energy paradigm must change and the environment is being destroyed by absurd use of oil? Is this consistency?

Am I not forgetting what the oil companies will do with my trillion dollars and my carte blanche?  Am I not forgetting that they will drill everywhere to the point of exhaustion, simultaneously getting everyone buying their products until the moment in which there is no oil and there is no possible shift in paradigm?

- luispc

March 25, 2009 at 4:26pm

Luis: argument by analogy usually demonstrate the weakness of the initial position.  Please answer Nari's point on its own merits, instead of introducing another, and irrelevant, point about oil.

Do you know of any economic system, now or in the far reaches of history, outside of Marx's communes, that does not operate on credit?

- icarusr

March 25, 2009 at 5:23pm

Sorry Icarusr. I'll keep my analogy.

Do you know any society today that doesn't depend on oil?

- luispc

March 25, 2009 at 5:47pm