Tom Cheney in the New Yorker, February 9, 2008

Scott S. Powell, writing in Barron’s, exonerates George W. Bush for the mortgage crisis and blames instead a long-term trend featuring the intrusion of politics into the US economy.

Well, electing Obama will certainly fix that, won’t it?

The Bush administration made many mistakes, but deregulation was not one of them.

Not only was there no major deregulation passed during the past eight years, but the Bush administration and a Republican Congress approved the most sweeping financial-market regulation in decades.

The bipartisan Sarbanes-Oxley Act was enacted in 2002 to prevent corporate fraud and restore investor confidence after the collapse of Enron and WorldCom. It failed to prevent the accounting fraud and influence-peddling scandals at Fannie Mae and Freddie Mac. And even after those scandals were widely understood, regulators sent Fannie and Freddie back into the market to continue buying subprime loans, lending and borrowing with implied taxpayer backing.

Across the government, the Bush administration supported new regulations that added almost 1,000 pages a year to the Federal Register, nearly a record. If this is insufficient regulation, it’s hard to imagine a scope that would be effective.

We are in this mess largely because critical thought and moral judgment have been subordinated to the politicization of our economy, resulting in regulatory gaps and excessive controls of the wrong kind.

Government regulations should be limited to those that increase and protect transparency and competition, protect public and private property, promote individual responsibility and enforce equal opportunity under the law. Even if the right laws and regulations could be found, they would prove insufficient to protect freedom and prosperity.

In his farewell address, George Washington said that religion and morality are essential to sustain democracy in America. He might well have added that virtue is just as indispensable to its economy. When the captains of banking and finance and their congressional overseers fail in moral judgment, the results are disastrous for everyone. As we are now witnessing in the real-estate, stock- and bond-market dislocations, once trust is lost, markets freeze and long-standing relationships break down, resulting in illiquidity, irrational pricing and severe losses.

Today’s problems have their roots in programs and financial instruments that shifted the locus of moral responsibility away from private individuals and institutions to wider circles that were understood to end with a government guarantee. Heads of the top banks and financial institutions could approve substandard home-mortgage underwriting — prone to increased default — because those loans could be securitized by Wall Street and sold off to investors or to government-sponsored enterprises (GSEs), with no likely recourse to the financial institution of origin.

Our present crisis began in the 1970s, during the Carter administration, with passage of the Community Reinvestment Act to stem bank redlining and liberalize lending in order to extend home ownership in lower-income communities. Then in the 1990s, the Department of Housing and Urban Development took a fateful step by getting the GSEs to accept subprime mortgages. With Fannie and Freddie easing credit requirements on loans they would purchase from lenders, banks could greatly increase lending to borrowers unqualified for conventional loans. In the name of extending affordable housing, this broadened the acceptability of risky loans throughout the financial system.

The risk lurking in the GSE portfolios was acknowledged in the Bush administration’s first fiscal-year budget, released in April 2001. It stated that Fannie and Freddie were “a potential problem” because “financial trouble of a large GSE could cause strong repercussions in the financial markets, affecting federally insured entities and economic activity.” Fed Chairman Alan Greenspan issued repeated warnings that the GSEs “placed the total financial system of the future at substantial risk.” Such warnings went unheeded even after accounting scandals rocked Fannie and Freddie.

The collapse and government seizure of Fannie and Freddie in September 2008 ended the experiment in partial socialization of the U.S. housing sector. Before we try complete concentration of federal financial power, we should understand that power and political corruption abrogated moral judgment on every level.

The poor and middle class were encouraged to live beyond their means and buy houses they couldn’t afford; speculators were lured into excessive risk-taking; banks were rewarded for lowering their loan standards; and Wall Street found new windfall profits from securitizing and reselling bad loans in bulk. With the support of regulators, credit-rating agencies provided cover for the whole charade.

There is plenty of blame to go around on both sides of the political aisle. But the lesson should be clear that socializing failed businesses — whether in housing, health care or in Detroit — is not a long-term solution. Expanding government’s intrusion into the private sector doesn’t come without great risk. The renewing and self-correcting nature of the private sector is largely lost in the public sector, where accountability is impaired by obfuscation of responsibility, and where special interests benefit even when the public good is ill-served.

Barack Obama’s political career began with the winning of an Illinois State Senate seat by taking control of the process and getting all his democrat party opponents (in a one party race) kicked off the ballot. Barack Obama’s career reached its present zenith, at least in part, through other process short cuts like the democrat party’s rules committee awarding him primary delegates from Michigan where he did not run and duplicate registrations and votes courtesy of ACORN.

Newsmax:

The Obama administration is ending the Census Bureau’s traditional autonomy – a move that has Republicans outraged over the White House’s politicization of counting Americans.

Last week, an administration official revealed that the yet-to-be-named director of the Census Bureau will report to the White House rather than Commerce Secretary nominee Judd Gregg, a Republican.

What this move undoubtedly signifies is the Obama Administration’s intention to make an end run around the Constitution’s specification of an “actual enumeration” every decade to permit statistical estimates of non-actually-enumerated democrat constituencies in order to enlarge the congressional representation and budgetary apportionment for inner-city, one-party democrat-controlled districts. The estimating would be done by hardcore democrat party partisans, of course, who can estimate with the best.

Mr. Gregg should never have agreed to accept the Secretary of Commerce appointment in the context of such a cynical and opportunistic partisan manuever.

———————————–

UPDATE 2/13:

Senator Judd Gregg announced, very politely, that he was declining the appointment due to “irresolvable conflicts.” Good for him.

South Carolina Governor Mark Sanford articulates the Republican position on the democrat party Porkulus:

A problem that was created by building up of too much debt will not be solved with yet more debt,” Gov. Mark Sanford said Sunday, making a reference to the federal deficit spending that will likely finance the federal stimulus package.

“We’re moving precipitously close to what I would call a savior-based economy,” Sanford also said Sunday on CNN’s State of the Union.

The South Carolina Republican said such an economy is “what you see in Russia or Venezuela or Zimbabwe or places like that where it matters not how good your product is to the consumer but what your political connection is to those in power.”

“That is quite different than a market-based economy where some rise and some fall but there’s a consequence to making a stupid decision,” Sanford said after pointing to the powers granted to the Treasury Department and the Federal Reserve to help deal with the current economic crisis.

“A lot of people who’ve made some very stupid decisions are being bailed out by the population at large,” he added.

Instead of bailing out failing companies, Sanford told CNN’s John King that the government should let the economy work through the current challenges without intervention.

“We’re going to go through a process of deleveraging,” Sanford said. “And it will be painful. The question is: Do we apply a bunch of different band aids that lengthen and prolong this pain or do we take the band aid off? I believe very strongly: let’s get this thing over with, let’s not drag it on.”

Talk about the man who had everything.

Jacques Littlefield didn’t only own what every Silicon Valley executive wants: his own hilltop in Portola Valley. On his 430 acre Pony Tracks Ranch he kept and serviced his own collection of 230 tanks, missile launchers, armored cars, and personnel carriers.

SF Chronicle:

Jacques Littlefield, an unassuming multimillionaire who amassed the country’s largest private collection of tanks and other military armored vehicles, died Wednesday at his Portola Valley ranch. He was 59. …

Mr. Littlefield owned about 200 tanks, self-propelled guns, armored personnel carriers, anti-aircraft vehicles and other heavy combat vehicles, ranging from an M1917 “Six-Ton Tractor” from World War I to a Russian T-72 used by Saddam Hussein’s forces in the Iraq war.

He painstakingly restored the vehicles and kept them in a football-field-size showroom on his ranch. In accordance with state and federal law, none of tanks had functioning firing apparatus, but he did occasionally drive them around his 470-acre property.

A jewel in his collection is the German Panzer V (Panzerkampfwagon V -JDZ) Panther tank that the German army sank in a Polish river during World War II to keep it from the advancing Russians. The Panther sat submerged for decades, and Mr. Littlefield acquired it five years ago and began restoring it.

“Restoration is very satisfying, especially with something like the Panther,” Mr. Littlefield said in a 2007 interview with The Chronicle. “People say: ‘You’ll never get that thing running again.’ Well, it was built once, and we can do it again.”

——————————

WSJ:

His collections extracted a personal cost. “It happens to a lot of guys,” he told The Wall Street Journal in 1992. “It happened to me. You get a tank, you get divorced. You get divorced, you lose the tank to pay the settlement.”

——————————

Jacques Littlefield web-site

Lots of photos of his collection here

Driving restored (turret not yet mounted) Panther 5:00 video – not easy parking one of these in the garage.

Littlefield runs over a Mercedes with his tank 0:49 video

And Melanie Phillips has had enough.

President Obama has had, by general consent, a torrid First Fortnight. To put it another way, it has taken precisely two weeks for the illusion that brought him to power to be exposed for the nonsense that it so obviously was. The transformational candidate who was going to sweep away pork-barrel politics, lobbyists and corruption has been up to his neck in sleaze, as eviscerated here by Charles Krauthammer. Despite the fact that he came to power promising to ‘ban all earmarks’, his ‘stimulus’ bill represents billions of dollars of special-interest tax breaks, giveaways and protections — which have nothing to do with kick-starting the economy and everything to do with favouring pet Democrat causes.

He has been appointing one tax dodger, lobbyist and wheeler-dealer after another. After appointing one official,Treasury Secretary Timothy Geithner, who had unaccountably forgotten to pay his taxes, he then watched his designated Health Secretary Tom Daschle fall on his sword because he too had taken a tax holiday. Daschle was furthermore a prominent actor in the world of lobbying and influence-peddling. Leon Panetta, Obama’s nominee for Director of the CIA has also, according to the Wall Street Journal, consulted for prominent companies and sat on the board of a public affairs firm that lobbies Congress. The Weekly Standard reports that Secretary of Labour nominee Hilda Solis was not only involved with a private organization lobbying her fellow legislators on a bill that she helped sponsor, but she apparently kept her involvement secret and failed to reveal a clear conflict of interest. …

America – what have you done?!

Read the whole thing.

Betsey Ramsdale’s Facebook photo

A young woman teaching in the middle school in Beaver Dam, Wisconsin was suspended by panicking school administrators after a busybody on the school staff discovered that Betsey Ramsdale had posted a picture of herself on Facebook aiming a gun.

WKOW-TV:

Beaver Dam school officials placed a middle school teacher on administrative leave after discovering a photograph of the teacher with a gun on the teacher’s Facebook page.

In the photo, teacher Betsy Ramsdale is training a rifle at the camera. …

[T]he Facebook photo was brought to the attention of school district officials by a concerned staff member at Beaver Dam Middle School. …
Middle school parent Jennifer Buzzell said the teacher’s decision to post the photograph was concerning.

“I don’t think it’s appropriate,” Buzzell told 27 News. “I’m not sure why this would be on the computer at all.”

“I don’t see anything wrong with it,” school parent Mark Hagstrom said. “She’s on her time to do what she wants.”

1:55 video

Ms. Ramsdale’s pose in the photo is actually not a terribly unusual shooting photo pose. If the photographic objective is to present the subject aiming, this angle is the only way to show the person’s face aligned with the barrel and the sights. Additionally, the looking-down-the barrel viewpoint adds drama.

Beyond which, chicks and guns have a particular appeal as a combination, image-wise. Hollywood has been exploiting the iconic image of the girl with a gun forever. Some of the biggest Hollywood film industry supporters of gun control, people like Sigourney Weaver and Jodie Foster, can be found striking fierce poses-with-pieces on lobby cards

Ramsdale’s photo on a personal Facebook profile obviously has nothing to do with her job, and ought to be considered to exist in a realm outside the jurisdiction of her employers. Its supposedly alarming character is simply a case of the extreme and unreasonable fear of arms which infects the deracinated and effeminate contemporary community of fashion.

Note also the inability of the school administrators and the press to distinguish a shotgun from a rifle.

Yuval Levin, in Commentary, reflects on Sarah Palin’s candidacy and what it revealed about class and politics in contemporary America.

In American politics, the distinction between populism and elitism is… subdivided into cultural and economic populism and elitism. And for at least the last forty years, the two parties have broken down distinctly along this double axis. The Republican party has been the party of cultural populism and economic elitism, and the Democrats have been the party of cultural elitism and economic populism. Republicans tend to identify with the traditional values, unabashedly patriotic, anti-cosmopolitan, non-nuanced Joe Sixpack, even as they pursue an economic policy that aims at elite investor-driven growth. Democrats identify with the mistreated, underpaid, overworked, crushed-by-the-corporation “people against the powerful,” but tend to look down on those people’s religion, education, and way of life. Republicans tend to believe the dynamism of the market is for the best but that cultural change can be dangerously disruptive; Democrats tend to believe dynamic social change stretches the boundaries of inclusion for the better but that economic dynamism is often ruinous and unjust.

Both economic and cultural populism are politically potent, but in America, unlike in Europe, cultural populism has always been much more powerful. Americans do not resent the success of others, but they do resent arrogance, and especially intellectual arrogance. Even the poor in our country tend to be moved more by cultural than by economic appeals. It was this sense, this feeling, that Sarah Palin channeled so effectively. Her appearance on the scene unleashed populist energies that McCain had not tapped, and she both fed them and fed off them. She spent the bulk of her time at Republican rallies assailing the cultural radicalism of Barack Obama and his latte-sipping followers, who, she occasionally suggested, were not part of the “the real America” she saw in the adoring throngs standing before her. Palin channeled these cultural energies more by what she was than by what she said or did, which contributed mightily to the odd disjunction between her professional resume and her campaign presence and impact. …

Palin never actually boasted of ignorance or explicitly scorned learning or ideas. Rather, the implicit charge was that Palin’s failure to speak the language and to share the common points of reference of the educated upper tier of American society essentially rendered her unfit for high office.

This form of intellectual elitism is actually fairly new in America, though it has been a dominant feature of European society since World War II. It is not as exclusive or as anti-democratic as cultural elitism is in other countries, because entry to the American intellectual elite is, in principle, open to all who pursue it. And pursuing it is not as difficult as it once was, at least for the middle class. Indeed, most of this elite’s prominent members hail from middle-class origins and not from traditional bastions of American privilege and wealth. They can speak of growing up in Scranton, even as they raise their noses at dirty coal and hunting season.

Nor is membership in the intellectual upper class determined by diplomas hanging on the wall. Palin could have gained entrance easily, despite the fact that she holds a mere degree in journalism from the University of Idaho. Although the intellectual elite is deeply shaped by our leading institutions of higher learning, belonging to it is more the result of shared assumptions and attitudes. It is more cultural than academic, more NPR than PhD. In Washington, many politicians who have not risen through the best of universities work hard for years to master the language and the suppositions of this upper tier, and to live carefully within the bounds prescribed by its view of the world.

Applied to politics, the worldview of the intellectual elite begins from an unstated assumption that governing is fundamentally an exercise of the mind: an application of the proper mix of theory, expertise, and intellectual distance that calls for knowledge and verbal fluency more than for prudence born of life’s hard lessons.

Sarah Palin embodied a very different notion of politics, in which sound instincts and valuable life experiences are considered sources of knowledge at least the equal of book learning. She is the product of an America in which explicit displays of pride in intellect are considered unseemly, and where physical prowess and moral constancy are given a higher place than intellectual achievement. She was in the habit of stressing these faculties instead—a habit that struck many in Washington as brutishness.

This is why Palin was seen as anti-intellectual when, properly speaking, she was simply non-intellectual. What she lacked was not intelligence—she is, clearly, highly intelligent—but rather the particular set of assumptions, references, and attitudes inculcated by America’s top twenty universities and transmitted by the nation’s elite cultural organs.

Many of those (including especially those on the Right) who reacted badly to Palin on intellectual grounds understand themselves to be advancing the interests of lower-middle-class families similar to Palin’s own family and to many of those in attendance at her rallies who greeted her arrival on the scene as a kind of deliverance. But it is hard to escape the conclusion that while these members of the intellectual elite want the government to serve the interests of such people first and foremost, they do not want those people to hold the levers of power.

Read the whole thing.

Hat tip to Bird Dog‘s Best Essays of the Year.

Shiite Iraqi policemen (and their officers) receive a solid dose of the effective kind of motivational instruction that Western soldiers have been receiving from non-commissioned officers since back when Christ was a corporal. One can picture some Roman centurian delivering the same address at Hadrian’s Wall, also via translator, to his blue-painted Brithonic auxiliaries.

5:35 video

Some of us have very amusing commenters. At Ann Althouse’s blog, garage mahal writes:

Althouse voting for Obama is like buying a Barbie to mutilate it.

The American leftwing establishment recently erupted in outrage and indignation over the rise to political prominence of a flagrant tax cheat.

Who was it that provoked the storm of criticism? How much had he declined to pay?

Warner Todd Huston has the answers.

A.Q. Khan celebrates the end of his house arrest

Another foreign policy triumph for the new Obama Administration was recorded when Pakistan announced that, there being no big, bad Republican administration to push Pakistan around any more, the need to keep up the pretence of confining A.Q. Khan, the father of the Islamic nuclear bomb and the world’s key source of nuclear proliferation, under house arrest had passed.

Presumably now the lovable old gnome can get back to work assisting the oppressed and indignant of the Third World win the respect of the decadent and Imperialist West by brandishing brand new nuclear weapons in its face.

Guardian:

Abdul Qadeer Khan, the Pakistani nuclear scientist at the centre of the world’s largest proliferation scandal, has been freed from five years of house arrest by a court in Islamabad.

Khan, lionised as the “father” of Pakistan’s atomic bomb, confessed in 2004 to selling nuclear secrets to Iran, North Korea and Libya. He was immediately pardoned but detained in his home.

Since then Khan has retracted his tearful televised confession. Speaking outside his house today after the high court ruling, Khan said: “It’s a matter of joy. The judgment, by the grace of Allah, is good. It is because of this judgment that I am speaking to you.”

Khan’s lawyer said the high court had declared him a free citizen. “The court has said as he was not involved in nuclear proliferation or criminal activity, there is no case against him, therefore he is a free citizen,” Ali Zafar said. …

His confinement had been progressively relaxed over the past year as he was allowed to meet friends and give selective interviews. He travelled to Karachi at least once under tight security.

Last year a UN nuclear watchdog said Khan’s network smuggled nuclear blueprints to Iran, Libya and North Korea and was active in 12 countries. Last month the US state department imposed sanctions on 13 individuals – two of them British – and three private companies because of their involvement in Khan’s network.

Pakistan has prevented foreign investigators from questioning Khan, insisting it has passed on all relevant information about nuclear proliferation.

Khan said he had no need to answer to any foreign government. “I will always be proud about what I did for Pakistan,” he told reporters. “I am obliged to answer only to my government, not to any foreigners.”