Commentary Magazine


Posts For: May 26, 2009

Popularity Doesn’t Get You Everything

Chris Cillizza contends that Sotomayor is a “confident” pick — evidence that Obama is convinced that he can get his way no matter how hard conservatives scream. There is something to that. After all, elections have consequences and he has a lot of votes in the Senate. But I think the argument says something about the pick. In a sense, Cillizza is arguing that no matter how extreme, how intellectually suspect, and how outlandish some of his nominee’s statements may be, Obama is, well, Obama, so he gets what he wants. Perhaps.

I don’t doubt that this is what the White House thinks, but I wonder if they have figured out all the angles. It was this same faith in the power of personal popularity that convinced the White House that facing off against Dick Cheney was a swell idea. It is the presumption that poll numbers trump substance. It is the view that the public will ignore fundamental beliefs that have predominated in a center-right society because Obama is Obama. It underestimates the power of facts and the power of ideas. And that is sometimes a mistake.

When the entire country is focused, and clear arguments are made on the merits, poll numbers lose their oomph. You can’t simply say, “Sotomayor should be confirmed because Obama’s approval is 60%.” The substance — whether on Guantanamo or a Supreme Court judge’s jurisprudence — matters. Obama’s nominee will have to make the case for herself and face tough questioning about what she believes and whether she is capable of judging with impartiality. And then we’ll see if the American people buy what Obama and Sotomayor are selling as judicial philosophy.

The issue is not, I think, whether Obama can win the nomination. It is whether he can win the battle of judicial activism — convince the public that the rule of law is piffle and that divvying up by race is a great way to run the country. That is what we are about to undertake: a grand intellectual battle. In such contests, it is better to be right than to be popular. So stay tuned.

Chris Cillizza contends that Sotomayor is a “confident” pick — evidence that Obama is convinced that he can get his way no matter how hard conservatives scream. There is something to that. After all, elections have consequences and he has a lot of votes in the Senate. But I think the argument says something about the pick. In a sense, Cillizza is arguing that no matter how extreme, how intellectually suspect, and how outlandish some of his nominee’s statements may be, Obama is, well, Obama, so he gets what he wants. Perhaps.

I don’t doubt that this is what the White House thinks, but I wonder if they have figured out all the angles. It was this same faith in the power of personal popularity that convinced the White House that facing off against Dick Cheney was a swell idea. It is the presumption that poll numbers trump substance. It is the view that the public will ignore fundamental beliefs that have predominated in a center-right society because Obama is Obama. It underestimates the power of facts and the power of ideas. And that is sometimes a mistake.

When the entire country is focused, and clear arguments are made on the merits, poll numbers lose their oomph. You can’t simply say, “Sotomayor should be confirmed because Obama’s approval is 60%.” The substance — whether on Guantanamo or a Supreme Court judge’s jurisprudence — matters. Obama’s nominee will have to make the case for herself and face tough questioning about what she believes and whether she is capable of judging with impartiality. And then we’ll see if the American people buy what Obama and Sotomayor are selling as judicial philosophy.

The issue is not, I think, whether Obama can win the nomination. It is whether he can win the battle of judicial activism — convince the public that the rule of law is piffle and that divvying up by race is a great way to run the country. That is what we are about to undertake: a grand intellectual battle. In such contests, it is better to be right than to be popular. So stay tuned.

Read Less

Commentary of the Day

Ed Lasky, on Jonathan Tobin:

Apparently, Barack Obama does prefer one kind of outsourcing, that is, of our American foreign policy. Here comes the internationalization of American foreign policy. What is most perilous about this preferred course of conduct is that entrusting the transformation of Pax Americana into Pax United Nations is a fool’s errand. The halls of the UN are similar to a sketch in my M.C. Escher: an endless series of steps and stairways twisting and turning with very little hope for progress visible. But there is a greater and altogether not recognized danger from the depths of the UN structure. Iran occupies key posts throughout the UN: it has colonized that body. I recommend Claudio Rosett’s column in Forbes magazine that ran on Dec 11th, 2008. She reveals the extent of Iranian penetration of the UN, occurring over the years, underneath the radar screen. Does Susan Rice appreciate that American reliance on the UN will be diverted and blocked out not just by vetoes held by Security Council members or by almost the worthless General Assembly, but also by key executives who receive bounteous and tax-free salaries, partly from American taxpayers?

Ed Lasky, on Jonathan Tobin:

Apparently, Barack Obama does prefer one kind of outsourcing, that is, of our American foreign policy. Here comes the internationalization of American foreign policy. What is most perilous about this preferred course of conduct is that entrusting the transformation of Pax Americana into Pax United Nations is a fool’s errand. The halls of the UN are similar to a sketch in my M.C. Escher: an endless series of steps and stairways twisting and turning with very little hope for progress visible. But there is a greater and altogether not recognized danger from the depths of the UN structure. Iran occupies key posts throughout the UN: it has colonized that body. I recommend Claudio Rosett’s column in Forbes magazine that ran on Dec 11th, 2008. She reveals the extent of Iranian penetration of the UN, occurring over the years, underneath the radar screen. Does Susan Rice appreciate that American reliance on the UN will be diverted and blocked out not just by vetoes held by Security Council members or by almost the worthless General Assembly, but also by key executives who receive bounteous and tax-free salaries, partly from American taxpayers?

Read Less

Linkage One Way or Another

So — is there a connection between Palestine and Iran? Is there “linkage”?

Defense Minister Ehud Barak says no, and also believes the Americans should better understand this:

“It’s not as if the moment the last outpost is dismantled, for reasons of the rule of law and the country’s authority over its citizens, the Iranians will abandon their nuclear ambitions,” Barak said. “This is why these things need not be [presented as] directly interdependent.”

But does Prime Minister Netanyahu understand this simple truth? The answer is probably yes, but what he said yesterday might mislead the public into concluding otherwise:

“I identify the danger, and that’s why I am willing to take unpopular steps such as evacuating outposts. The Iranian threat is above everything,” Netanyahu reportedly said. “There are things on which you have to compromise.”

In fact, what’s happening here is fascinating: Israel started by claiming there is no linkage. Its position later evolved into there being linkage: “The road to Palestine goes through Tehran” and not the other way around. Americans, though, weren’t convinced. They insisted that traditional linkage is unavoidable in order to bring other Arab countries on board in stopping Iran. In essence, the Obama administration has argued that one can’t hope for Arab cooperation without showing progress on the Palestinian track. But now, as both Barak’s and Netanyahu’s statements demonstrate, we are at a new stage: Israel is the one admitting that there’s linkage. The irony though is that this concession comes not from Arabs’ demanding linkage, but rather because of Americans. Barak still hopes to reeducate the Obama administration. Netanyahu soberly admits defeat. Linkage is a fact of life not because of Iranians, Palestinians, or other Arab countries. It’s a fact of life because of, well, the Americans who believe in it.

So — is there a connection between Palestine and Iran? Is there “linkage”?

Defense Minister Ehud Barak says no, and also believes the Americans should better understand this:

“It’s not as if the moment the last outpost is dismantled, for reasons of the rule of law and the country’s authority over its citizens, the Iranians will abandon their nuclear ambitions,” Barak said. “This is why these things need not be [presented as] directly interdependent.”

But does Prime Minister Netanyahu understand this simple truth? The answer is probably yes, but what he said yesterday might mislead the public into concluding otherwise:

“I identify the danger, and that’s why I am willing to take unpopular steps such as evacuating outposts. The Iranian threat is above everything,” Netanyahu reportedly said. “There are things on which you have to compromise.”

In fact, what’s happening here is fascinating: Israel started by claiming there is no linkage. Its position later evolved into there being linkage: “The road to Palestine goes through Tehran” and not the other way around. Americans, though, weren’t convinced. They insisted that traditional linkage is unavoidable in order to bring other Arab countries on board in stopping Iran. In essence, the Obama administration has argued that one can’t hope for Arab cooperation without showing progress on the Palestinian track. But now, as both Barak’s and Netanyahu’s statements demonstrate, we are at a new stage: Israel is the one admitting that there’s linkage. The irony though is that this concession comes not from Arabs’ demanding linkage, but rather because of Americans. Barak still hopes to reeducate the Obama administration. Netanyahu soberly admits defeat. Linkage is a fact of life not because of Iranians, Palestinians, or other Arab countries. It’s a fact of life because of, well, the Americans who believe in it.

Read Less

Obama’s Daedalus

In the New Republic, E.J. Dionne, Jr., in wondering how much longer President Obama can keep sending different messages to different audiences, ends his column this way:

But establishments have a habit of becoming too confident in their ability to manipulate people and events, and too certain of their own moral righteousness. Obama’s political and substantive gifts are undeniable. What he needs to realize are the limits of his own mastery.

To which I have two responses, the first being that from what I can tell about Obama, he sees almost no limits to his own mastery. President Obama is a man of extraordinary, never-before-seen-on-Planet-Earth self-regard. It is probably beyond any human being’s capacity to measure it. Second, if even Dionne — a man utterly enchanted with Obama and a  supporter who uses his column to cheerlead for him time and again — is beginning to recognize this, then one can safely assume what we are dealing with is not an obscure trait (as Christopher Hitchens has pointed out, even Obama’s jokes are about his strengths rather than his weaknesses). Dionne may be Obama’s Daedalus. Obama would be wise to listen now when the wax on his wings has not yet melted, rather than later.

In the New Republic, E.J. Dionne, Jr., in wondering how much longer President Obama can keep sending different messages to different audiences, ends his column this way:

But establishments have a habit of becoming too confident in their ability to manipulate people and events, and too certain of their own moral righteousness. Obama’s political and substantive gifts are undeniable. What he needs to realize are the limits of his own mastery.

To which I have two responses, the first being that from what I can tell about Obama, he sees almost no limits to his own mastery. President Obama is a man of extraordinary, never-before-seen-on-Planet-Earth self-regard. It is probably beyond any human being’s capacity to measure it. Second, if even Dionne — a man utterly enchanted with Obama and a  supporter who uses his column to cheerlead for him time and again — is beginning to recognize this, then one can safely assume what we are dealing with is not an obscure trait (as Christopher Hitchens has pointed out, even Obama’s jokes are about his strengths rather than his weaknesses). Dionne may be Obama’s Daedalus. Obama would be wise to listen now when the wax on his wings has not yet melted, rather than later.

Read Less

Talk About a Lemon

The Washington Post editors have figured out the Obama administration’s modus operandi: give money, then strong-arm the recipients. They write:

In theory, a government bailout should provide a short-term infusion of cash to give a struggling company the chance to right itself. But in its aggressive dealings with U.S. automakers, most recently General Motors, the Obama administration is coming dangerously close to engaging in financial engineering that ignores basic principles of fairness and economic realities to further political goals.

[. . .]

While the Obama administration has been playing hardball with bondholders, it has been more than happy to play nice with the United Auto Workers. How else to explain why a retiree health-care fund controlled by the UAW is slated to get a 39 percent equity stake in GM for its remaining $10 billion in claims while bondholders are being pressured to take a 10 percent stake for their $27 billion? It’s highly unlikely that the auto industry professionals at GM would have cut such a deal had the government not been standing over them — or providing the steady stream of taxpayer dollars needed to keep the factory doors open.

But this, of course, is nothing new. Have we already forgotten the AIG bonus flap? Has Tim Geithner let the banks pay back their TARP money yet? This is what comes, inevitably, from an administration with a vast social and economic agenda, which has used an economic crisis as an “opportunity” to alter the relationship between the public and private sectors.

The Obama administration’s policy agenda on labor and climate control, to name just two items, is going to clash with the profit motives of car companies. Guess which side will prevail. Similarly, when the banks took the cash (or had it foisted upon them) they should not have expected the freedom to continue to operate as they did before they became wards of the state. Statism or crony capitalism, or whatever we call it, is about the sheer exercise of government power over what used to be private decisions regulated by the marketplace and the rule of law.

This is precisely why we shouldn’t go down this road and why those interested in preserving the rule of law and some semblance of a free market economy should speak up. But bondholders are being bullied into silence. And Congress has ceded its role as regulator and appropriator to the executive branch. What’s to stop “Government Motors”? Well, there’s the ballot box and car lots all over the country where Americans can register their views.

The Washington Post editors have figured out the Obama administration’s modus operandi: give money, then strong-arm the recipients. They write:

In theory, a government bailout should provide a short-term infusion of cash to give a struggling company the chance to right itself. But in its aggressive dealings with U.S. automakers, most recently General Motors, the Obama administration is coming dangerously close to engaging in financial engineering that ignores basic principles of fairness and economic realities to further political goals.

[. . .]

While the Obama administration has been playing hardball with bondholders, it has been more than happy to play nice with the United Auto Workers. How else to explain why a retiree health-care fund controlled by the UAW is slated to get a 39 percent equity stake in GM for its remaining $10 billion in claims while bondholders are being pressured to take a 10 percent stake for their $27 billion? It’s highly unlikely that the auto industry professionals at GM would have cut such a deal had the government not been standing over them — or providing the steady stream of taxpayer dollars needed to keep the factory doors open.

But this, of course, is nothing new. Have we already forgotten the AIG bonus flap? Has Tim Geithner let the banks pay back their TARP money yet? This is what comes, inevitably, from an administration with a vast social and economic agenda, which has used an economic crisis as an “opportunity” to alter the relationship between the public and private sectors.

The Obama administration’s policy agenda on labor and climate control, to name just two items, is going to clash with the profit motives of car companies. Guess which side will prevail. Similarly, when the banks took the cash (or had it foisted upon them) they should not have expected the freedom to continue to operate as they did before they became wards of the state. Statism or crony capitalism, or whatever we call it, is about the sheer exercise of government power over what used to be private decisions regulated by the marketplace and the rule of law.

This is precisely why we shouldn’t go down this road and why those interested in preserving the rule of law and some semblance of a free market economy should speak up. But bondholders are being bullied into silence. And Congress has ceded its role as regulator and appropriator to the executive branch. What’s to stop “Government Motors”? Well, there’s the ballot box and car lots all over the country where Americans can register their views.

Read Less

More Foreigners in the Army

This USA Today article provides a splendid example of the potential benefits of a reform I have long advocated — making it easier to enroll foreigners in the U.S. military. It describes the experience of Forat Aldawoodi, who served as an interpreter for U.S. forces in Iraq, then immigrated to the U.S., joined the Army, and went back to Iraq as a soldier patrolling the very neighborhood he once lived in.

Here is how his commanding officer, Lt. Col. Dave Bair of the 82nd Airborne Division, describes Aldwadoodi’s contributions:

What makes Aldawoodi so valuable is his familiarity with the area and a native understanding of Iraqi culture, Bair said. On almost every mission, Aldawoodi accompanies him, according to Bair. After meeting with a community leader or local Iraqi security force commander, Bair usually calls Aldawoodi into his office to get his impressions and thoughts on what was said between the lines.

When not on patrol, Aldawoodi spends much of his time on the phone, reaching out to Iraqi leaders on behalf of Bair or calling friends to get a better sense of the mood on the street.

Though Aldawoodi is barely a year out of boot camp and holds a junior rank, Bair said he considers him a trusted adviser. “I have to remind myself that he’s just an E-4 (specialist),” Bair said. “I load him up just as much as I do some of my officers. I can’t stress how valuable he’s been to us here.”

There are lots of people like Aldawoodi around the world who have great respect for America and would be eager to join our armed forces for a chance at citizenship. If we facilitate that process — as the armed forces are starting to — we will in return get many valuable members of the military and of society in general.

I am not much swayed by diatribes about how Rome fell because of its supposed overreliance on mercenaries. That’s not true and even if it were it’s of no relevance today because I am not suggesting turning over our defense to mercenaries. All I am suggesting is that we supplement our existing soldiery with more foreign-born volunteers who, like many illustrious predecessors, aspire to become Americans. One of Rome’s strengths was actually its ability to assimilate foreigners and that is one of America’s strengths as well — one we should do more to take advantage of.

This USA Today article provides a splendid example of the potential benefits of a reform I have long advocated — making it easier to enroll foreigners in the U.S. military. It describes the experience of Forat Aldawoodi, who served as an interpreter for U.S. forces in Iraq, then immigrated to the U.S., joined the Army, and went back to Iraq as a soldier patrolling the very neighborhood he once lived in.

Here is how his commanding officer, Lt. Col. Dave Bair of the 82nd Airborne Division, describes Aldwadoodi’s contributions:

What makes Aldawoodi so valuable is his familiarity with the area and a native understanding of Iraqi culture, Bair said. On almost every mission, Aldawoodi accompanies him, according to Bair. After meeting with a community leader or local Iraqi security force commander, Bair usually calls Aldawoodi into his office to get his impressions and thoughts on what was said between the lines.

When not on patrol, Aldawoodi spends much of his time on the phone, reaching out to Iraqi leaders on behalf of Bair or calling friends to get a better sense of the mood on the street.

Though Aldawoodi is barely a year out of boot camp and holds a junior rank, Bair said he considers him a trusted adviser. “I have to remind myself that he’s just an E-4 (specialist),” Bair said. “I load him up just as much as I do some of my officers. I can’t stress how valuable he’s been to us here.”

There are lots of people like Aldawoodi around the world who have great respect for America and would be eager to join our armed forces for a chance at citizenship. If we facilitate that process — as the armed forces are starting to — we will in return get many valuable members of the military and of society in general.

I am not much swayed by diatribes about how Rome fell because of its supposed overreliance on mercenaries. That’s not true and even if it were it’s of no relevance today because I am not suggesting turning over our defense to mercenaries. All I am suggesting is that we supplement our existing soldiery with more foreign-born volunteers who, like many illustrious predecessors, aspire to become Americans. One of Rome’s strengths was actually its ability to assimilate foreigners and that is one of America’s strengths as well — one we should do more to take advantage of.

Read Less

Those Poor Dimwitted Terrorists

Something didn’t smell right about the city’s triumphant announcement that a sting operation had led to the arrest of four men who had placed dummy bombs outside two Bronx synagogues. How far would these “sad sacks” have really gone, asks Zachary Roth at Talking Points Memo, without the aid and encouragement of the undercover law-enforcement agents?

Frankly, it’s also hard not to feel some compassion for what looks like a group of struggling, credulous, under-educated men, existing on the fringes of society, who lacked the intelligence or willpower to avoid getting taken in by a government informant anxious to mitigate his own situation, and by their own vague understanding of radical Islam and the hole it might fill in their lives.

More from Roth:

Is sending a government mole out to scrounge up a few dimwitted ex-cons who can be talked–and perhaps bribed–into getting involved in a fictitious bomb plot really the best way to use our limited terror-fighting resources?

Finally,

There’s little doubt the bumbling would-be bombers went far enough with the plot to demonstrate that they had the intention to commit terror, and for that they’ll pay the price. But the whole tale comes off perhaps more as a sad glimpse into the lives of a loose group of aimless and obscurely embittered Americans than as a dire illustration of the threat of home-grown terrorism.

For anyone with eyes to see, what this episode really illustrates—and hardly for the first time—is how worryingly simple it is to pull off a terror attack in an open society. No complicated weapons wielded by well-adjusted brainiacs are required; a gun or explosive device and a public place will suffice for most any “dimwit.” Law-enforcement agencies have few alternatives to seeking out those inclined to commit such acts and thwarting them.

Something didn’t smell right about the city’s triumphant announcement that a sting operation had led to the arrest of four men who had placed dummy bombs outside two Bronx synagogues. How far would these “sad sacks” have really gone, asks Zachary Roth at Talking Points Memo, without the aid and encouragement of the undercover law-enforcement agents?

Frankly, it’s also hard not to feel some compassion for what looks like a group of struggling, credulous, under-educated men, existing on the fringes of society, who lacked the intelligence or willpower to avoid getting taken in by a government informant anxious to mitigate his own situation, and by their own vague understanding of radical Islam and the hole it might fill in their lives.

More from Roth:

Is sending a government mole out to scrounge up a few dimwitted ex-cons who can be talked–and perhaps bribed–into getting involved in a fictitious bomb plot really the best way to use our limited terror-fighting resources?

Finally,

There’s little doubt the bumbling would-be bombers went far enough with the plot to demonstrate that they had the intention to commit terror, and for that they’ll pay the price. But the whole tale comes off perhaps more as a sad glimpse into the lives of a loose group of aimless and obscurely embittered Americans than as a dire illustration of the threat of home-grown terrorism.

For anyone with eyes to see, what this episode really illustrates—and hardly for the first time—is how worryingly simple it is to pull off a terror attack in an open society. No complicated weapons wielded by well-adjusted brainiacs are required; a gun or explosive device and a public place will suffice for most any “dimwit.” Law-enforcement agencies have few alternatives to seeking out those inclined to commit such acts and thwarting them.

Read Less

Fact-Checking Obama

In his C-SPAN interview with Steve Scully on Friday, President Obama said this:

I think the right option is to say, where are the game changers, the investments that we can make now that are going to reduce costs, even if they don’t reduce them this year or next year, but 10 years from now or 20 years from now, we are going to see substantially lower costs. And if – one of the very promising areas that we saw was these insurance companies, drug companies, hospitals, all these stakeholders coming together, committing to me that they would reduce costs by 1.5 percent per year. If we do that, it seems like [a] small number, we end up saving $2 trillion. $2 trillion, which not only can help deal with our deficit and our long-term debt, but a lot of those savings can go back into the pockets of American consumers in the form of lower premiums. That’s what we are driving for.

The trouble is, Obama’s account is not true. The New York Times has explained why:.”

Health care leaders who attended the meeting have a different interpretation. They say they agreed to slow health spending in a more gradual way and did not pledge specific year-by-year cuts. “There’s been a lot of misunderstanding that has caused a lot of consternation among our members,” said Richard J. Umbdenstock, the president of the American Hospital Association. “I’ve spent the better part of the last three days trying to deal with it.” Nancy-Ann DeParle, director of the White House Office of Health Reform, said “the president misspoke” on Monday and again on Wednesday when he described the industry’s commitment in similar terms. After providing that account, Ms. DeParle called back about an hour later on Thursday and said: “I don’t think the president misspoke. His remarks correctly and accurately described the industry’s commitment.”

The Washington office of the American Hospital Association sent a bulletin to its state and local affiliates to “clarify several points” about the White House meeting.

In the bulletin, Richard J. Pollack, the executive vice president of the hospital association, said: “The A.H.A. did not commit to support the ‘Obama health plan’ or budget. No such reform plan exists at this time.” Moreover, Mr. Pollack wrote, “The groups did not support reducing the rate of health spending by 1.5 percentage points annually.” He and other health care executives said they had agreed to squeeze health spending so the annual rate of growth would eventually be 1.5 percentage points lower.

Later in the article we read that two lobbyists who participated in the meeting confirmed Pollack’s story.

Clearly the president did misspeak the first time. And obviously he and the White House know the claim that health care industries are going to reduce costs by 1.5 percent per year, rather than over 10 years, is not true. Yet Obama keeps insisting it is. But what is becoming increasingly clear is that Obama shares with Bill Clinton the tendency to routinely, almost promiscuously, use straw-men to strengthen his case. Last week I wrote that like Bill Clinton before him, Barack Obama employs smooth and persuasive words that, upon close inspection, are at odds with reality. Obama fancies himself a teller of inconvenient truths, a man who will admit to mistakes and whose words are trustworthy, who will speak up, rather than down, to the public. At a minimum, then, Obama should not continue to make claims he, and we, know to be false.

In his C-SPAN interview with Steve Scully on Friday, President Obama said this:

I think the right option is to say, where are the game changers, the investments that we can make now that are going to reduce costs, even if they don’t reduce them this year or next year, but 10 years from now or 20 years from now, we are going to see substantially lower costs. And if – one of the very promising areas that we saw was these insurance companies, drug companies, hospitals, all these stakeholders coming together, committing to me that they would reduce costs by 1.5 percent per year. If we do that, it seems like [a] small number, we end up saving $2 trillion. $2 trillion, which not only can help deal with our deficit and our long-term debt, but a lot of those savings can go back into the pockets of American consumers in the form of lower premiums. That’s what we are driving for.

The trouble is, Obama’s account is not true. The New York Times has explained why:.”

Health care leaders who attended the meeting have a different interpretation. They say they agreed to slow health spending in a more gradual way and did not pledge specific year-by-year cuts. “There’s been a lot of misunderstanding that has caused a lot of consternation among our members,” said Richard J. Umbdenstock, the president of the American Hospital Association. “I’ve spent the better part of the last three days trying to deal with it.” Nancy-Ann DeParle, director of the White House Office of Health Reform, said “the president misspoke” on Monday and again on Wednesday when he described the industry’s commitment in similar terms. After providing that account, Ms. DeParle called back about an hour later on Thursday and said: “I don’t think the president misspoke. His remarks correctly and accurately described the industry’s commitment.”

The Washington office of the American Hospital Association sent a bulletin to its state and local affiliates to “clarify several points” about the White House meeting.

In the bulletin, Richard J. Pollack, the executive vice president of the hospital association, said: “The A.H.A. did not commit to support the ‘Obama health plan’ or budget. No such reform plan exists at this time.” Moreover, Mr. Pollack wrote, “The groups did not support reducing the rate of health spending by 1.5 percentage points annually.” He and other health care executives said they had agreed to squeeze health spending so the annual rate of growth would eventually be 1.5 percentage points lower.

Later in the article we read that two lobbyists who participated in the meeting confirmed Pollack’s story.

Clearly the president did misspeak the first time. And obviously he and the White House know the claim that health care industries are going to reduce costs by 1.5 percent per year, rather than over 10 years, is not true. Yet Obama keeps insisting it is. But what is becoming increasingly clear is that Obama shares with Bill Clinton the tendency to routinely, almost promiscuously, use straw-men to strengthen his case. Last week I wrote that like Bill Clinton before him, Barack Obama employs smooth and persuasive words that, upon close inspection, are at odds with reality. Obama fancies himself a teller of inconvenient truths, a man who will admit to mistakes and whose words are trustworthy, who will speak up, rather than down, to the public. At a minimum, then, Obama should not continue to make claims he, and we, know to be false.

Read Less

Re: It’s Sotomayor

I have a few thoughts on the timing and initial reaction to Sotomayor’s nomination as well as the issues emerging as the focus of her nomination. As a preliminary matter, I was pleasantly surprised to see that Republicans, including Sen. Mitch McConnell and Sen. Orin Hatch (who voted to confirm her for the Second Circuit), were noteworthy in their restraint. They have suppressed the urge to rush to the microphone with words of praise or to concede that anything (either the outcome or timing) is preordained. The country, the Senate, and the media will learn a lot about her in the weeks to follow. And it would be utterly inappropriate to prejudge anything at this stage.

From the White House’s perspective this tells me two things. First, they can’t wait to change the subject from Guantanamo and North Korea to soemthing else — and all the better to pour on diversity and empathy chatter that will delight the president’s liberal base. Second, the president is not concerned about an intellectual powerhouse who can lure Justice Kennedy to “his side.” He thinks there will be plenty of time to tip the court with future nominations. He wanted a constituent-pleasing, safe “liberal” vote on the court. (As Charles Krauthammer points out, nothing so excites the Democratic Left as a heaping of identity politics.) So far that’s what he has got.

But moving on to the issues Sotomayor’s nomination raises, Obama has also taken on quite a battle. First, his nominee makes no bones about her belief in the Court as an engine of social change. For those moderate and conservative Democrats in the Senate this may prove to be a “hard” vote.  Second, she has pushed for racial quotas both in an advocacy role and on the Court. Third, her reversal rate suggests she is a judicial extremist who differs with the Supreme Court on a wide range of issues.

In sum, as Stuart Taylor explained, she is the personification of identity-politics. In reviewing what will be a much picked over speech by Sotomayor lauding Latina judges, Taylor observed:

Sotomayor also referred to the cardinal duty of judges to be impartial as a mere “aspiration because it denies the fact that we are by our experiences making different choices than others.” And she suggested that “inherent physiological or cultural differences” may help explain why “our gender and national origins may and will make a difference in our judging.”

So accustomed have we become to identity politics that it barely causes a ripple when a highly touted Supreme Court candidate, who sits on the federal Appeals Court in New York, has seriously suggested that Latina women like her make better judges than white males.

Indeed, unless Sotomayor believes that Latina women also make better judges than Latino men, and also better than African-American men and women, her basic proposition seems to be that white males (with some exceptions, she noted) are inferior to all other groups in the qualities that make for a good jurist.

The president is entitled to nominate whomever he wants. What is stunning is that he wanted someone who throughout her professional life has repudiated the sort of post-racial message that was the basis of his candidacy. Presumably, the president knows this and is pleased to leave his mark on the bench — an act that will resonate long after voters and media mavens forget that this was a presidential candidate committed to ending the politics that divided rather than united Americans. Now we know precisely what “post-racial” means. Strangely enough, it looks an awful lot like the racial politics that has pitted Americans against one another for decades. I was hoping for change.

I have a few thoughts on the timing and initial reaction to Sotomayor’s nomination as well as the issues emerging as the focus of her nomination. As a preliminary matter, I was pleasantly surprised to see that Republicans, including Sen. Mitch McConnell and Sen. Orin Hatch (who voted to confirm her for the Second Circuit), were noteworthy in their restraint. They have suppressed the urge to rush to the microphone with words of praise or to concede that anything (either the outcome or timing) is preordained. The country, the Senate, and the media will learn a lot about her in the weeks to follow. And it would be utterly inappropriate to prejudge anything at this stage.

From the White House’s perspective this tells me two things. First, they can’t wait to change the subject from Guantanamo and North Korea to soemthing else — and all the better to pour on diversity and empathy chatter that will delight the president’s liberal base. Second, the president is not concerned about an intellectual powerhouse who can lure Justice Kennedy to “his side.” He thinks there will be plenty of time to tip the court with future nominations. He wanted a constituent-pleasing, safe “liberal” vote on the court. (As Charles Krauthammer points out, nothing so excites the Democratic Left as a heaping of identity politics.) So far that’s what he has got.

But moving on to the issues Sotomayor’s nomination raises, Obama has also taken on quite a battle. First, his nominee makes no bones about her belief in the Court as an engine of social change. For those moderate and conservative Democrats in the Senate this may prove to be a “hard” vote.  Second, she has pushed for racial quotas both in an advocacy role and on the Court. Third, her reversal rate suggests she is a judicial extremist who differs with the Supreme Court on a wide range of issues.

In sum, as Stuart Taylor explained, she is the personification of identity-politics. In reviewing what will be a much picked over speech by Sotomayor lauding Latina judges, Taylor observed:

Sotomayor also referred to the cardinal duty of judges to be impartial as a mere “aspiration because it denies the fact that we are by our experiences making different choices than others.” And she suggested that “inherent physiological or cultural differences” may help explain why “our gender and national origins may and will make a difference in our judging.”

So accustomed have we become to identity politics that it barely causes a ripple when a highly touted Supreme Court candidate, who sits on the federal Appeals Court in New York, has seriously suggested that Latina women like her make better judges than white males.

Indeed, unless Sotomayor believes that Latina women also make better judges than Latino men, and also better than African-American men and women, her basic proposition seems to be that white males (with some exceptions, she noted) are inferior to all other groups in the qualities that make for a good jurist.

The president is entitled to nominate whomever he wants. What is stunning is that he wanted someone who throughout her professional life has repudiated the sort of post-racial message that was the basis of his candidacy. Presumably, the president knows this and is pleased to leave his mark on the bench — an act that will resonate long after voters and media mavens forget that this was a presidential candidate committed to ending the politics that divided rather than united Americans. Now we know precisely what “post-racial” means. Strangely enough, it looks an awful lot like the racial politics that has pitted Americans against one another for decades. I was hoping for change.

Read Less

We Need Unpredictability

A lot of electronic ink has been spilled on this site and elsewhere over Barack Obama’s adoption of George W. Bush’s national security policies. On wars in progress (Iraq and Afghanistan) there is no longer a question of this administration’s adherence to the last administration’s goals. The American commitment to Iraq today is indistinguishable from the American commitment to Iraq on Bush’s last day in the White House. In Afghanistan, Obama has both broadened and deepened the effort, and placed operations under new, impressive leadership. On interrogation and detainee policy, the president has come around to most Bush-era postures. It is only his dogged refusal to acknowledge as much that creates the illusion of renunciation. And in dealing with rogue regimes, Obama is constrained by the same puny tool box that was available to Bush.

However, there is something missing from most discussions of Bush’s and Obama’s foreign policies: the element of unpredictability. Because Bush launched two invasions in his first term, America’s enemies were never sure that his willingness to engage in foreign adventures was depleted. Such uncertainty was reinforced by Bush’s determination to see the Iraq War through its season of catastrophe. Who could ultimately say if the guy who decided to topple Saddam and rebuild Iraq (and who followed through!) would shy away from a bombing campaign on Iran or even North Korea? If the jury was out in this country it was surely out elsewhere. Obama, on the other hand, has saturated the global media with his message of American humility and his stated aversion to threats and “dictating” to other countries. Moreover, he’s taken every opportunity overseas to let leaders know of his intention to “reset” American foreign policy — from harsh to mild. He’s not looking for any trouble, as the saying goes.

But we know what that disclaimer customarily invites.

Tehran and Pyongyang were bad during the Bush years, but not this bad. And not this brazen.

In North Korea we see launches on top of tests on top of launches — all of them proscribed by international treaties and resolutions. When Bush was in office, Kim played an on-again-off-again game with six-party talks. With Obama in office, it doesn’t seem to be worth the effort. It’s quicker to nab two American journalists and see where that gets you. The missile charade has lost any tactical value for Pyongang. Back in March, Hillary Clinton was asked if the U.S. would shoot down a North Korean Taepodong-2 missile scheduled for launch in a few days. “We’re not talking about doing anything like that,” she said. We don’t want any trouble. She didn’t have to tell Kim twice.

On Tuesday, Iran sent six warships into international waters. Five days earlier Tehran test-fired 1,200-mile range missiles. Hey, Barack Obama already told Iranian leaders that our interests in Iran “will not be advanced by threats. We seek instead engagement that is honest and grounded in mutual respect.” We certainly didn’t have to respect Tehran before, but we do now have to respect a mini-fleet of warships in the Gulf of Aden.

It is somewhat ironic that Bush was perceived as being less predictable than Obama, considering the latter has reversed almost every one of his previously held national security positions. In this perception may lay an advantage for the U.S. If this administrations has so thoroughly lulled bad actors into a sense of enduring comfort, dumb mistakes are sure to follow. If Obama continues to wake up to harsh reality while regimes like the one in Pyongyang begin to overplay their hand, just think how effective a little unpredictability would be. Obama has painted himself into a corner and will need to do something unexpectedly bold. That may be a bombing raid on Iran, a commitment to ignore Russia and move ahead with missile shields in Eastern Europe, a commitment to missile shields for South Korea and Japan, or something else entirely.

When you say you’re not looking for any trouble you have to stick your hand in your pocket and pretend you have a gun even if you don’t. At least that way you keep your enemy guessing. Barack Obama thought it would be just as effective to offer his empty hand in friendship. He was wrong.

A lot of electronic ink has been spilled on this site and elsewhere over Barack Obama’s adoption of George W. Bush’s national security policies. On wars in progress (Iraq and Afghanistan) there is no longer a question of this administration’s adherence to the last administration’s goals. The American commitment to Iraq today is indistinguishable from the American commitment to Iraq on Bush’s last day in the White House. In Afghanistan, Obama has both broadened and deepened the effort, and placed operations under new, impressive leadership. On interrogation and detainee policy, the president has come around to most Bush-era postures. It is only his dogged refusal to acknowledge as much that creates the illusion of renunciation. And in dealing with rogue regimes, Obama is constrained by the same puny tool box that was available to Bush.

However, there is something missing from most discussions of Bush’s and Obama’s foreign policies: the element of unpredictability. Because Bush launched two invasions in his first term, America’s enemies were never sure that his willingness to engage in foreign adventures was depleted. Such uncertainty was reinforced by Bush’s determination to see the Iraq War through its season of catastrophe. Who could ultimately say if the guy who decided to topple Saddam and rebuild Iraq (and who followed through!) would shy away from a bombing campaign on Iran or even North Korea? If the jury was out in this country it was surely out elsewhere. Obama, on the other hand, has saturated the global media with his message of American humility and his stated aversion to threats and “dictating” to other countries. Moreover, he’s taken every opportunity overseas to let leaders know of his intention to “reset” American foreign policy — from harsh to mild. He’s not looking for any trouble, as the saying goes.

But we know what that disclaimer customarily invites.

Tehran and Pyongyang were bad during the Bush years, but not this bad. And not this brazen.

In North Korea we see launches on top of tests on top of launches — all of them proscribed by international treaties and resolutions. When Bush was in office, Kim played an on-again-off-again game with six-party talks. With Obama in office, it doesn’t seem to be worth the effort. It’s quicker to nab two American journalists and see where that gets you. The missile charade has lost any tactical value for Pyongang. Back in March, Hillary Clinton was asked if the U.S. would shoot down a North Korean Taepodong-2 missile scheduled for launch in a few days. “We’re not talking about doing anything like that,” she said. We don’t want any trouble. She didn’t have to tell Kim twice.

On Tuesday, Iran sent six warships into international waters. Five days earlier Tehran test-fired 1,200-mile range missiles. Hey, Barack Obama already told Iranian leaders that our interests in Iran “will not be advanced by threats. We seek instead engagement that is honest and grounded in mutual respect.” We certainly didn’t have to respect Tehran before, but we do now have to respect a mini-fleet of warships in the Gulf of Aden.

It is somewhat ironic that Bush was perceived as being less predictable than Obama, considering the latter has reversed almost every one of his previously held national security positions. In this perception may lay an advantage for the U.S. If this administrations has so thoroughly lulled bad actors into a sense of enduring comfort, dumb mistakes are sure to follow. If Obama continues to wake up to harsh reality while regimes like the one in Pyongyang begin to overplay their hand, just think how effective a little unpredictability would be. Obama has painted himself into a corner and will need to do something unexpectedly bold. That may be a bombing raid on Iran, a commitment to ignore Russia and move ahead with missile shields in Eastern Europe, a commitment to missile shields for South Korea and Japan, or something else entirely.

When you say you’re not looking for any trouble you have to stick your hand in your pocket and pretend you have a gun even if you don’t. At least that way you keep your enemy guessing. Barack Obama thought it would be just as effective to offer his empty hand in friendship. He was wrong.

Read Less

The Unlucky Number Seven

Adding to Rick’s fine points regarding “two state solutionism,” note that former Israeli general and National Security Advisor Giora Eiland has written a short-but-sharp compilation of “America’s seven false assumptions” on the two-state solution. “Had the US administration undertaken a real assessment and examined the fundamental assumptions underlining the [two state] solution, it may have reached different conclusions,” Eiland writes. The seven crux issues are:

• Do Palestinians want a state in line with the 1967 borders, or do they want much more?
• Can the differences between Israeli and Palestinian leadership be bridged?
• Do Egypt and Jordan have any real interest in solving the conflict?
• Will a final status agreement actually bring stability?
• Is this the right time for reaching an agreement?
• If one wants Arab support on Iran, does one need to make progress in Palestine?
• Is there only one solution to the conflict?

So while Israel and the U.S. will be wasting a lot of precious time negotiating a “deal” on evacuation of outposts, and while Netanyahu will be wasting a lot of political capital in trying to prevent his coalition from collapsing due to these negotiations, it will be easy to forget that none of this really matters. The twenty-six outposts can be evacuated, agreement on settlement-freeze in some form can be reached, final status negotiations can be resumed — unfortunately, peace may still be as elusive as it is today.

Adding to Rick’s fine points regarding “two state solutionism,” note that former Israeli general and National Security Advisor Giora Eiland has written a short-but-sharp compilation of “America’s seven false assumptions” on the two-state solution. “Had the US administration undertaken a real assessment and examined the fundamental assumptions underlining the [two state] solution, it may have reached different conclusions,” Eiland writes. The seven crux issues are:

• Do Palestinians want a state in line with the 1967 borders, or do they want much more?
• Can the differences between Israeli and Palestinian leadership be bridged?
• Do Egypt and Jordan have any real interest in solving the conflict?
• Will a final status agreement actually bring stability?
• Is this the right time for reaching an agreement?
• If one wants Arab support on Iran, does one need to make progress in Palestine?
• Is there only one solution to the conflict?

So while Israel and the U.S. will be wasting a lot of precious time negotiating a “deal” on evacuation of outposts, and while Netanyahu will be wasting a lot of political capital in trying to prevent his coalition from collapsing due to these negotiations, it will be easy to forget that none of this really matters. The twenty-six outposts can be evacuated, agreement on settlement-freeze in some form can be reached, final status negotiations can be resumed — unfortunately, peace may still be as elusive as it is today.

Read Less

Putting Our Faith in the UN Cesspool

The keystone to Barack Obama’s foreign policy is a revived faith in international institutions such as the United Nations and deference to the opinion of the same. But despite the seeming popularity of this policy, reasons for disgust at the current state of the UN and its agencies continues to build up.

One example is provided in an open letter signed by French philosopher Bernard-Henri Levy, “Shoah” director Claude Lanzmann, and Elie Wiesel, published by the Huffington Post. In it these three heavyweights express their dismay at the near certainty that Farouk Hosny, the Egyptian Minister of Culture, will become the next Director General of UNESCO. They write:

Mr. Farouk Hosny is not worthy of this role; Mr. Farouk Hosny is the opposite of a man of peace, dialogue, and culture; Mr. Farouk Hosny is a dangerous man, an inciter of hearts and minds. There is only little, very little time left to avoid committing the major mistake of elevating Mr. Farouk Hosny above others to this eminent post.

Hosny’s statements over the years mark him down as an incorrigible Israel- and Jew-hater who has actually advocated the burning of books published by Israelis. The latter is a perfect resume line for someone who is supposedly going to be responsible for preserving the heritage of this planet’s culture, isn’t it?

But already in office and far higher up in the Byzantine labyrinth of UN bureaucracies is another ideologue and hater: Miguel d’Escoto Brockmann, president of the United Nations General Assembly. A hardcore Sandinista veteran of Nicaragua’s nightmarish past, d’Escoto has already provoked concern in the United States for his open hostility to the state of Israel. Now, the New York Times has reported on his plans for using the UN as a platform for institutionalizing his socialist dogmas. This not very sympathetic piece by Neil MacFarquhar, tells us that Brockman wants to create 9 new global institutions, authorities, and advisory boards:

Everyone basically agreed that the United Nations should serve as the voice of the poorest nations, and that its many tentacles provided an excellent source for collecting data on the impact of the meltdown. … To Mr. d’Escoto, a priest and former Nicaraguan foreign minister, the world financial crisis demonstrates the need for something closer to a revolution, both to mend the deep wounds opened by capitalist excess and to prevent future calamity. He wants the General Assembly to be anointed the leader in reformulating the world’s economic institutions. (The draft document suggested an open-ended process, steered by Mr. d’Escoto.)

“If the new financial system and architecture is going to be put together, and these rules of the game are going to affect everyone, as the crisis has affected everyone, the proposed solution and new rules of the game should be legitimate for everyone,” said Paul Oquist, Mr. d’Escoto’s senior adviser for the conference, and a Nicaraguan official. “It is the General Assembly that offers that in a universal vein.”

Sitting beneath portraits of Fidel Castro of Cuba, President Hugo Chávez of Venezuela and President Daniel Ortega of Nicaragua, among others, Mr. Oquist also said that the meltdown of 2008 proved that no state or states had a monopoly on financial wisdom. That statement, at least, attracts a consensus here.

So, in addition to being a cesspool of anti-Semitism, as demonstrated anew by the pick of Hosny, the United Nations will, under d’Escoto’s leadership, become a clearinghouse for a new socialist “revolution” that will attempt to re-order the international financial system in the image of Nicaragua or Cuba. And Barack Obama wants us to listen more closely to the UN and care about its opinions? John Bolton’s famous quip about lopping off 10 floors off the UN building never seemed more moderate.

The keystone to Barack Obama’s foreign policy is a revived faith in international institutions such as the United Nations and deference to the opinion of the same. But despite the seeming popularity of this policy, reasons for disgust at the current state of the UN and its agencies continues to build up.

One example is provided in an open letter signed by French philosopher Bernard-Henri Levy, “Shoah” director Claude Lanzmann, and Elie Wiesel, published by the Huffington Post. In it these three heavyweights express their dismay at the near certainty that Farouk Hosny, the Egyptian Minister of Culture, will become the next Director General of UNESCO. They write:

Mr. Farouk Hosny is not worthy of this role; Mr. Farouk Hosny is the opposite of a man of peace, dialogue, and culture; Mr. Farouk Hosny is a dangerous man, an inciter of hearts and minds. There is only little, very little time left to avoid committing the major mistake of elevating Mr. Farouk Hosny above others to this eminent post.

Hosny’s statements over the years mark him down as an incorrigible Israel- and Jew-hater who has actually advocated the burning of books published by Israelis. The latter is a perfect resume line for someone who is supposedly going to be responsible for preserving the heritage of this planet’s culture, isn’t it?

But already in office and far higher up in the Byzantine labyrinth of UN bureaucracies is another ideologue and hater: Miguel d’Escoto Brockmann, president of the United Nations General Assembly. A hardcore Sandinista veteran of Nicaragua’s nightmarish past, d’Escoto has already provoked concern in the United States for his open hostility to the state of Israel. Now, the New York Times has reported on his plans for using the UN as a platform for institutionalizing his socialist dogmas. This not very sympathetic piece by Neil MacFarquhar, tells us that Brockman wants to create 9 new global institutions, authorities, and advisory boards:

Everyone basically agreed that the United Nations should serve as the voice of the poorest nations, and that its many tentacles provided an excellent source for collecting data on the impact of the meltdown. … To Mr. d’Escoto, a priest and former Nicaraguan foreign minister, the world financial crisis demonstrates the need for something closer to a revolution, both to mend the deep wounds opened by capitalist excess and to prevent future calamity. He wants the General Assembly to be anointed the leader in reformulating the world’s economic institutions. (The draft document suggested an open-ended process, steered by Mr. d’Escoto.)

“If the new financial system and architecture is going to be put together, and these rules of the game are going to affect everyone, as the crisis has affected everyone, the proposed solution and new rules of the game should be legitimate for everyone,” said Paul Oquist, Mr. d’Escoto’s senior adviser for the conference, and a Nicaraguan official. “It is the General Assembly that offers that in a universal vein.”

Sitting beneath portraits of Fidel Castro of Cuba, President Hugo Chávez of Venezuela and President Daniel Ortega of Nicaragua, among others, Mr. Oquist also said that the meltdown of 2008 proved that no state or states had a monopoly on financial wisdom. That statement, at least, attracts a consensus here.

So, in addition to being a cesspool of anti-Semitism, as demonstrated anew by the pick of Hosny, the United Nations will, under d’Escoto’s leadership, become a clearinghouse for a new socialist “revolution” that will attempt to re-order the international financial system in the image of Nicaragua or Cuba. And Barack Obama wants us to listen more closely to the UN and care about its opinions? John Bolton’s famous quip about lopping off 10 floors off the UN building never seemed more moderate.

Read Less

Re: Re: Re: Where’s the Line?

Jen, thank you for essentially confirming my point that “much of the change from the Bush administrative has been rhetorical not substantive.” In fact, most of what you complain about is Obama’s rhetoric: that he has “pursued a campaign of rhetorical apology and meekness,” while inflating his own ability to reach out to those hostile to America. In terms of Obama’s more substantive moves, your concern is that:

He has chosen to dismantle missile defense programs at precisely the time we and our allies are confronting rogue states bent on acquiring nuclear weapons. He is forcing the military to make a series of “hard choices” in its budget while domestic spending runs wild. He not only discontinued enhanced interrogation techniques but released memos detailing those methods which now serve as a guide to terrorists. And his position on the truth commission and potential punishment for Bush administration officials is such a muddle it has, at the very least, unnerved those in the intelligence community who now, out of a normal sense self-preservation, will undoubtedly prize caution and inaction above all else.

I agree with many of these points — although it’s important to keep some perspective. For instance, as this article notes:

The Defense Department’s fiscal 2010 budget request would reduce funding for the Missile Defense Agency by $1.2 billion, eliminate the Multiple Kill Vehicle and Kinetic Energy Interceptor programs, and halt plans for a second aircraft carrying Airborne Laser technology. However, the plan includes $700 million in new funds for the Terminal High-Altitude Area Defense system and the Standard Missile 3 program.

So Obama is hardly gutting or dismantling missile defense; rather he is cutting the overall program by about 13% from the Bush level — which was elevated last year precisely in the expectation that a Democratic president would trim a bit. That doesn’t mean I agree with his decision but let’s not exaggerate how dangerous it is.

Read More

Jen, thank you for essentially confirming my point that “much of the change from the Bush administrative has been rhetorical not substantive.” In fact, most of what you complain about is Obama’s rhetoric: that he has “pursued a campaign of rhetorical apology and meekness,” while inflating his own ability to reach out to those hostile to America. In terms of Obama’s more substantive moves, your concern is that:

He has chosen to dismantle missile defense programs at precisely the time we and our allies are confronting rogue states bent on acquiring nuclear weapons. He is forcing the military to make a series of “hard choices” in its budget while domestic spending runs wild. He not only discontinued enhanced interrogation techniques but released memos detailing those methods which now serve as a guide to terrorists. And his position on the truth commission and potential punishment for Bush administration officials is such a muddle it has, at the very least, unnerved those in the intelligence community who now, out of a normal sense self-preservation, will undoubtedly prize caution and inaction above all else.

I agree with many of these points — although it’s important to keep some perspective. For instance, as this article notes:

The Defense Department’s fiscal 2010 budget request would reduce funding for the Missile Defense Agency by $1.2 billion, eliminate the Multiple Kill Vehicle and Kinetic Energy Interceptor programs, and halt plans for a second aircraft carrying Airborne Laser technology. However, the plan includes $700 million in new funds for the Terminal High-Altitude Area Defense system and the Standard Missile 3 program.

So Obama is hardly gutting or dismantling missile defense; rather he is cutting the overall program by about 13% from the Bush level — which was elevated last year precisely in the expectation that a Democratic president would trim a bit. That doesn’t mean I agree with his decision but let’s not exaggerate how dangerous it is.

I’ve already said it was a mistake to release the interrogation memos but, as I’ve also noted, in discontinuing the use of waterboarding and other “enhanced” techniques, Obama is only ratifying Bush’s second-term policy. And yes, he made a muddle of the issue of punishing Bush administration officials but he’s come down in the right place: i.e., effectively deciding not to prosecute.

On a host of other substantive issues — most notably Iraq and Afghanistan — he is pursuing policies that are just as hawkish as those of the Bush administration if not more so. On North Korea and Iran, meanwhile, he is pursuing policies just as ineffectual and muddle-headed as those of the Bush administration. But I don’t think that this constitutes a basis for claiming Obama doesn’t believe in defending us — any more than it was tenable to claim that Bush didn’t believe in defending us because he punted on issues like Iran and North Korea.

If Obama were pulling out two brigades a month from Iraq; if he were taking troops out of Afghanistan; if he were saying that he accepts Iran’s right to go nuclear; if he were promising to release Gitmo detainees who couldn’t be tried in the federal courts; if he were prosecuting those responsible for waterboarding Al Qaeda leaders; if he were ending targeted assassinations and renditions of Al Qaeda leaders — then I would agree he is pursuing a hopelessly weak foreign policy. But he is doing none of those things.

The Obama foreign policy I see emerging is essentially the Bush policy dressed up in kinder, gentler rhetoric. You and many others on the right are offended by some of Obama’s gestures, such as reaching out (literally) to Hugo Chavez or failing to make claims of American exceptionalism. But Obama calculates, I believe, that making American rhetoric more accommodating and less threatening will actually strengthen American security. And he may well be right. Bush (and Cheney) had a tendency toward sweeping rhetoric that alarmed and alienated a lot of the world while the actual policies they pursued were far meeker and milder and often didn’t live up to the hyped rhetorical claims about, for example, fighting terrorism or promoting democracy. There is a practical case for lowering the temperature on presidential rhetoric, and that’s what Obama is doing even as he’s preserving the core of the Bush national security policy.

You don’t have to agree with him, but again — to get back to my original point — none of this constitutes ground for claiming he doesn’t “believe in… a strong national defense.” You and other critics are welcome to claim that his policies are endangering American security, as Dick Cheney has said (and as most of the responders to my posts have echoed). Right or wrong, that’s a legitimate argument to make. My objection was simply to the way Liz Cheney phrased her objection — implying that not only was Obama endangering our security but that he had no interest in safeguarding the country to begin with.

I don’t think my criticism of Liz was overly harsh. I certainly never intuited bad faith to her. As I pointed out, this is an aberration for a “tough but principled debater.” In fact I took her to task precisely because I have considerable respect for her. I wouldn’t waste my time criticizing a clown like, say, Ann Coulter, because, unlike Liz, she is not a serious person.

Read Less

Re: What Now?

In response to North Korea conducting its second nuclear test, President Obama promised to “take action” in response to North Korea’s “blatant violation of international law.” “By acting in blatant defiance of the United Nations Security Council, North Korea is directly and recklessly challenging the international community,” Obama said in a statement yesterday. ” North Korea’s behavior increases tensions and undermines stability in Northeast Asia. Such provocations will only serve to deepen North Korea’s isolation.”

That was yesterday. Today we learned, “One day after its nuclear test drew angry and widespread condemnation, North Korea continued to defy the international community on Tuesday by test-firing two more short-range missiles,” a South Korean government official said. And according to the Associated Press, “just two weeks ago, the administration’s special envoy for disarmament talks with North Korea, Stephen Bosworth, said during a visit to Asian capitals that ‘everyone is feeling relatively relaxed about where we are at this point in the process.’” It appears as if Mr. Bosworth was a bit optimistic in his assessment.

President Obama’s condemnations of North Korea are predictable; the question is what he will do, in concrete terms, about it. I don’t pretend the answer is easy or obvious. The problem for Obama, though, is that during the campaign, he was the one who implied it was. In one speech, for example, he said this:

And I won’t hesitate to use the power of American diplomacy to stop countries from obtaining these weapons or sponsoring terror. The lesson of the Bush years is that not talking does not work. Go down the list of countries we’ve ignored and see how successful that strategy has been. We haven’t talked to Iran , and they continue to build their nuclear program. We haven’t talked to Syria , and they continue support for terror. We tried not talking to North Korea , and they now have enough material for 6 to 8 more nuclear weapons. It’s time to turn the page on the diplomacy of tough talk and no action. It’s time to turn the page on Washington’s conventional wisdom that agreement must be reached before you meet, that talking to other countries is some kind of reward, and that Presidents can only meet with people who will tell them what they want to hear. President Kennedy said it best: “Let us never negotiate out of fear, but let us never fear to negotiate.” Only by knowing your adversary can you defeat them or drive wedges between them. As President, I will work with our friend and allies, but I won’t outsource our diplomacy in Tehran to the Europeans, or our diplomacy in Pyongyang to the Chinese. I will do the careful preparation needed, and let these countries know where America stands. They will no longer have the excuse of American intransigence. They will have our terms: no support for terror and no nuclear weapons.

President Obama now has an opportunity to put his vaunted diplomatic skills to work. We have “turned the page” on the past. President Obama can now negotiate to his heart’s content. He can now meet individually and without precondition with Kim Jong Il and other dictators, as he promised he would. He can do all the careful preparation he needs and let North Korea know exactly where America stands. After all, they will no longer have the excuse of American intransigence. And then we will see if the North Korean leader will bend to Obama’s will and personal charm. The early returns aren’t terribly encouraging. According to this report:

Brushing aside the latest international condemnation North Korea repeated its argument that it needed a “nuclear deterrent” because of US aggression. “Our army and people are fully ready for battle … against any reckless US attempt for a pre-emptive attack,” the North’s KCNA news agency said in a editorial released on Tuesday. “The US would be well advised to halt at once its dangerous military moves against the [North Korea] if it wants to escape the lot of a tiger moth, bearing deep in mind that any attempt to make a pre-emptive attack on [North Korea] is little short of inviting a disaster itself.” The North has repeatedly said it needs a deterrent to ward off an attack by the US . Following Monday’s test, North Korea again accused the US of trying to “stifle” it by continuing with what it called the “hostile policy” practiced by the previous administration of George Bush. “The current US administration is following in the footsteps of the previous Bush administration’s reckless policy of militarily stifling North Korea ,” the North’s main Rodong Sinmun newspaper said in a commentary.

During the campaign, whenever asked how he would address a thorny foreign policy issue, Mr. Obama invoked the need for diplomacy — first, last, and always. The failure to reach agreement was found in some misunderstanding, some misperception, some problem of communication that could be cleared up by “talking.” Even those of us who don’t rule out the benefits of negotiating were skeptical about Obama’s seemingly limitless faith in it, or the ease with which he seemed to think these problems could be solved. As president, Obama has the perfect opportunity to prove that his approach will work and his precepts are the right ones. But I suspect he’ll learn — as he has with Iraq and the efficacy of surges and Guantanamo Bay and President Bush’s anti-terrorism policies more broadly — that reality has a way of colliding with, and exposing, shallow campaign words. Hopefully Obama will make the necessary adjustments again, as he has in the past.

In response to North Korea conducting its second nuclear test, President Obama promised to “take action” in response to North Korea’s “blatant violation of international law.” “By acting in blatant defiance of the United Nations Security Council, North Korea is directly and recklessly challenging the international community,” Obama said in a statement yesterday. ” North Korea’s behavior increases tensions and undermines stability in Northeast Asia. Such provocations will only serve to deepen North Korea’s isolation.”

That was yesterday. Today we learned, “One day after its nuclear test drew angry and widespread condemnation, North Korea continued to defy the international community on Tuesday by test-firing two more short-range missiles,” a South Korean government official said. And according to the Associated Press, “just two weeks ago, the administration’s special envoy for disarmament talks with North Korea, Stephen Bosworth, said during a visit to Asian capitals that ‘everyone is feeling relatively relaxed about where we are at this point in the process.’” It appears as if Mr. Bosworth was a bit optimistic in his assessment.

President Obama’s condemnations of North Korea are predictable; the question is what he will do, in concrete terms, about it. I don’t pretend the answer is easy or obvious. The problem for Obama, though, is that during the campaign, he was the one who implied it was. In one speech, for example, he said this:

And I won’t hesitate to use the power of American diplomacy to stop countries from obtaining these weapons or sponsoring terror. The lesson of the Bush years is that not talking does not work. Go down the list of countries we’ve ignored and see how successful that strategy has been. We haven’t talked to Iran , and they continue to build their nuclear program. We haven’t talked to Syria , and they continue support for terror. We tried not talking to North Korea , and they now have enough material for 6 to 8 more nuclear weapons. It’s time to turn the page on the diplomacy of tough talk and no action. It’s time to turn the page on Washington’s conventional wisdom that agreement must be reached before you meet, that talking to other countries is some kind of reward, and that Presidents can only meet with people who will tell them what they want to hear. President Kennedy said it best: “Let us never negotiate out of fear, but let us never fear to negotiate.” Only by knowing your adversary can you defeat them or drive wedges between them. As President, I will work with our friend and allies, but I won’t outsource our diplomacy in Tehran to the Europeans, or our diplomacy in Pyongyang to the Chinese. I will do the careful preparation needed, and let these countries know where America stands. They will no longer have the excuse of American intransigence. They will have our terms: no support for terror and no nuclear weapons.

President Obama now has an opportunity to put his vaunted diplomatic skills to work. We have “turned the page” on the past. President Obama can now negotiate to his heart’s content. He can now meet individually and without precondition with Kim Jong Il and other dictators, as he promised he would. He can do all the careful preparation he needs and let North Korea know exactly where America stands. After all, they will no longer have the excuse of American intransigence. And then we will see if the North Korean leader will bend to Obama’s will and personal charm. The early returns aren’t terribly encouraging. According to this report:

Brushing aside the latest international condemnation North Korea repeated its argument that it needed a “nuclear deterrent” because of US aggression. “Our army and people are fully ready for battle … against any reckless US attempt for a pre-emptive attack,” the North’s KCNA news agency said in a editorial released on Tuesday. “The US would be well advised to halt at once its dangerous military moves against the [North Korea] if it wants to escape the lot of a tiger moth, bearing deep in mind that any attempt to make a pre-emptive attack on [North Korea] is little short of inviting a disaster itself.” The North has repeatedly said it needs a deterrent to ward off an attack by the US . Following Monday’s test, North Korea again accused the US of trying to “stifle” it by continuing with what it called the “hostile policy” practiced by the previous administration of George Bush. “The current US administration is following in the footsteps of the previous Bush administration’s reckless policy of militarily stifling North Korea ,” the North’s main Rodong Sinmun newspaper said in a commentary.

During the campaign, whenever asked how he would address a thorny foreign policy issue, Mr. Obama invoked the need for diplomacy — first, last, and always. The failure to reach agreement was found in some misunderstanding, some misperception, some problem of communication that could be cleared up by “talking.” Even those of us who don’t rule out the benefits of negotiating were skeptical about Obama’s seemingly limitless faith in it, or the ease with which he seemed to think these problems could be solved. As president, Obama has the perfect opportunity to prove that his approach will work and his precepts are the right ones. But I suspect he’ll learn — as he has with Iraq and the efficacy of surges and Guantanamo Bay and President Bush’s anti-terrorism policies more broadly — that reality has a way of colliding with, and exposing, shallow campaign words. Hopefully Obama will make the necessary adjustments again, as he has in the past.

Read Less

Heeeeere’s Sonia!

President Barack Obama has just nominated Second Circuit Justice Sonia Sotomayor to replace David Souter on the Supreme Court. Over the next few days and weeks, tons of ink will be spilled over Sotomayor, with legal pundits on every network and in every newspaper analyzing her every decision.

But before any of that commences, I would like to salute Sotomayor for one of her lesser known decisions: back in 2000, she presided over the New York City Moot Court Championships as part of a three-judge panel and declared Townsend Harris High School the winner. I don’t remember the precise questions she asked my classmate and me that day as we delivered our oral arguments, but I do remember being told that we were facing a top-notch justice who was on the rise.

Apparently our high school principal was right.

President Barack Obama has just nominated Second Circuit Justice Sonia Sotomayor to replace David Souter on the Supreme Court. Over the next few days and weeks, tons of ink will be spilled over Sotomayor, with legal pundits on every network and in every newspaper analyzing her every decision.

But before any of that commences, I would like to salute Sotomayor for one of her lesser known decisions: back in 2000, she presided over the New York City Moot Court Championships as part of a three-judge panel and declared Townsend Harris High School the winner. I don’t remember the precise questions she asked my classmate and me that day as we delivered our oral arguments, but I do remember being told that we were facing a top-notch justice who was on the rise.

Apparently our high school principal was right.

Read Less

What Now?

The Wall Street Journal editors observe that North Korea’s nuclear test shouldn’t come as a surprise:

 After the North launched a long-range ballistic missile in April, Mr. Obama declared that “Rules must be binding. Violations must be punished. Words must mean something. The world must stand together to prevent the spread of these weapons. Now is the time for a strong international response.” But the U.S. couldn’t even get a Security Council resolution at the U.N. and had to settle for a nonbinding “presidential statement” of rebuke.

After Pyongyang said it would put two American journalists on trial in June, Secretary of State Hillary Clinton said there was an “open door” to talks. And when the North refused to return to the six-party nuclear talks, Presidential envoy Stephen Bosworth said the U.S. is “committed to dialogue.” Monday’s test brought more global tut-tutting, with the White House saying that “such provocations will only serve to deepen North Korea’s isolation.” But Kim Jong Il can be forgiven for concluding that his multiple violations will sooner be rewarded than punished.

Obama went to great lengths to ignore the provocations from North Korea, part of his global outreach that is premised, it seems, on the theory that if the U.S. humbles itself, avoids articulation of its interests, shies away from taking a stance on human rights, ignores misbehavior, and flatters the world’s miscreants, we will endear ourselves in some manner to rogue states. If Obama is as intensely “practical” as his supporters claim, he should examine the results of his outreach and assess whether he is making progress. If not, perhaps it is time for a different tone and vision. Maybe now is not the time to junk missile defense or plead with North Korea to return to the Six Party talks (so we can offer more bribes and continue not to discuss human rights?). As Dan Blumenthal and Robert Kagan suggest, there are steps the Obama administration can take:

First, it should enhance its deterrent to protect itself, South Korea and Japan. That means, above all, bolstering American and allied missile defenses and deterrent capabilities. Unfortunately, it is precisely American missile defense capabilities that the Obama administration is now cutting — despite the growing missile threat from North Korea and Iran. Second, it should strengthen multilateral efforts to stem North Korean proliferation, including more active efforts at interdiction and freezing bank accounts used to fund proliferation. Third, it should give up on the six-party talks. If it ever proves useful to talk to Pyongyang — a big “if” — let’s do so directly.

It is folly to think that China, Russia, Syria, Iran, and other nations aren’t paying very careful attention. Is this a president who can respond with steely determination or one who takes refuge in a fog of meaningless blather from hapless international institutions? It is no excuse to say the Bush administration was equally inept on this issue. Obama is president and it’s his responsibility to reverse a failing policy. Let’s see if he has any tools in his arsenal other than “outreach” and “engagement.”

The Wall Street Journal editors observe that North Korea’s nuclear test shouldn’t come as a surprise:

 After the North launched a long-range ballistic missile in April, Mr. Obama declared that “Rules must be binding. Violations must be punished. Words must mean something. The world must stand together to prevent the spread of these weapons. Now is the time for a strong international response.” But the U.S. couldn’t even get a Security Council resolution at the U.N. and had to settle for a nonbinding “presidential statement” of rebuke.

After Pyongyang said it would put two American journalists on trial in June, Secretary of State Hillary Clinton said there was an “open door” to talks. And when the North refused to return to the six-party nuclear talks, Presidential envoy Stephen Bosworth said the U.S. is “committed to dialogue.” Monday’s test brought more global tut-tutting, with the White House saying that “such provocations will only serve to deepen North Korea’s isolation.” But Kim Jong Il can be forgiven for concluding that his multiple violations will sooner be rewarded than punished.

Obama went to great lengths to ignore the provocations from North Korea, part of his global outreach that is premised, it seems, on the theory that if the U.S. humbles itself, avoids articulation of its interests, shies away from taking a stance on human rights, ignores misbehavior, and flatters the world’s miscreants, we will endear ourselves in some manner to rogue states. If Obama is as intensely “practical” as his supporters claim, he should examine the results of his outreach and assess whether he is making progress. If not, perhaps it is time for a different tone and vision. Maybe now is not the time to junk missile defense or plead with North Korea to return to the Six Party talks (so we can offer more bribes and continue not to discuss human rights?). As Dan Blumenthal and Robert Kagan suggest, there are steps the Obama administration can take:

First, it should enhance its deterrent to protect itself, South Korea and Japan. That means, above all, bolstering American and allied missile defenses and deterrent capabilities. Unfortunately, it is precisely American missile defense capabilities that the Obama administration is now cutting — despite the growing missile threat from North Korea and Iran. Second, it should strengthen multilateral efforts to stem North Korean proliferation, including more active efforts at interdiction and freezing bank accounts used to fund proliferation. Third, it should give up on the six-party talks. If it ever proves useful to talk to Pyongyang — a big “if” — let’s do so directly.

It is folly to think that China, Russia, Syria, Iran, and other nations aren’t paying very careful attention. Is this a president who can respond with steely determination or one who takes refuge in a fog of meaningless blather from hapless international institutions? It is no excuse to say the Bush administration was equally inept on this issue. Obama is president and it’s his responsibility to reverse a failing policy. Let’s see if he has any tools in his arsenal other than “outreach” and “engagement.”

Read Less

Did Hezbollah Kill Hariri?

The German magazine Der Spiegel dropped one heck of a political bomb on Lebanon a few days ago when it reported that United Nations investigators are now fingering Hezbollah, rather than Syria, for the former Lebanese Prime Minister Rafik Hariri’s assassination with a car bomb in downtown Beirut on Valentine’s Day in 2005.

The story is based on information from anonymous sources “close to the tribunal” and documents of unknown authenticity. We don’t know yet if the lead is accurate. Intriguingly, though, the UN’s spokesperson for the Special Tribunal for Lebanon neither confirms nor denies Der Spiegel‘s report. If a potentially explosive accusation like this one were false, I’d expect the UN to deny it emphatically.

Someone in Lebanon’s anti-Hezbollah “March 14” coalition may be hoping to use disinformation in Der Spiegel as a political weapon. These things happen. I’ve been lied to in Lebanon by people I trusted. It’s also possible that someone inside the UN thinks the people of Lebanon have a right to know what Hezbollah has done before they go to the polls next month and place assassins in the saddle in Beirut.

One of my own well-connected sources in Lebanon had this to say over email: “A rumor that the tribunal is going to end up issuing its indictments against Hezbollah, not Syria, has been floating around Beirut for the past month or so, and among highly credible sources. The impression I’ve gotten is that it would be largely a political move, a way to nail Hezbollah – and by association Iran – while largely letting Syria off the hook in the interests of promoting this fantasy-world ‘rapprochement’ with Damascus. Everyone I’ve heard discussing this still believes Syria did it. It’s a no brainer [sic] even if Hezbollah did play a role in carrying out the assassination.”

Click here to read the rest of this COMMENTARY Web Exclusive.

The German magazine Der Spiegel dropped one heck of a political bomb on Lebanon a few days ago when it reported that United Nations investigators are now fingering Hezbollah, rather than Syria, for the former Lebanese Prime Minister Rafik Hariri’s assassination with a car bomb in downtown Beirut on Valentine’s Day in 2005.

The story is based on information from anonymous sources “close to the tribunal” and documents of unknown authenticity. We don’t know yet if the lead is accurate. Intriguingly, though, the UN’s spokesperson for the Special Tribunal for Lebanon neither confirms nor denies Der Spiegel‘s report. If a potentially explosive accusation like this one were false, I’d expect the UN to deny it emphatically.

Someone in Lebanon’s anti-Hezbollah “March 14” coalition may be hoping to use disinformation in Der Spiegel as a political weapon. These things happen. I’ve been lied to in Lebanon by people I trusted. It’s also possible that someone inside the UN thinks the people of Lebanon have a right to know what Hezbollah has done before they go to the polls next month and place assassins in the saddle in Beirut.

One of my own well-connected sources in Lebanon had this to say over email: “A rumor that the tribunal is going to end up issuing its indictments against Hezbollah, not Syria, has been floating around Beirut for the past month or so, and among highly credible sources. The impression I’ve gotten is that it would be largely a political move, a way to nail Hezbollah – and by association Iran – while largely letting Syria off the hook in the interests of promoting this fantasy-world ‘rapprochement’ with Damascus. Everyone I’ve heard discussing this still believes Syria did it. It’s a no brainer [sic] even if Hezbollah did play a role in carrying out the assassination.”

Click here to read the rest of this COMMENTARY Web Exclusive.

Read Less

Keep a Weather Eye on the Bond Market This Week

There was a serious decline in the U.S. Treasury market on Thursday and Friday, accompanied by a sharp drop in the U.S. dollar, which backed over $1.40 against the euro. The 10-year T-note traded to yield 3.45% on Friday, and the 30-year bond almost reached 4.40%.

Yields are down slightly this morning, and the dollar is a bit stronger. (There is speculation that jitters over the North Korean nuclear blast are behind some of this action.) But it’s hard to miss a sense that sentiment is changing in this extremely important market.

Treasury securities have traded in a rather narrow range for weeks now, more or less since the stock market started rallying in early March. Typical yields for the 10-year note have ranged from 2.75 to 2.95 percent or so. (This maturity is the most critical for the economy and for the housing market.) But over just a few days, we’ve seen a sudden breakout to much higher yields in both the 10-year and the 30-year, while shorter-term yields have not moved as much. Thus, the yield curve has sharply steepened.

On Thursday morning, Standard and Poor’s changed their outlook on British government debt from “stable” to “negative.” These are terms of art which signify that S&P may at some point reduce its AAA rating on the UK. The stated reason was a lack of confidence that Britain would be able to square the circle of high public spending and poor prospects for economic growth.

That news story was followed quickly by a remark from Bill Gross (PIMCO’s chief investment officer, and one of the best bond traders in the world), that the U.S. might someday face the same fate.

About the same time, Tim Geithner was quoted as saying that medium and long-term Treasury debt is falling in price not because of a lack of confidence in the U.S. government, but rather because the economy is now recovering, and investors are ready to come out and start taking some real risk again. Have you noticed that when Geithner talks people have a tendency to assume the opposite of what he says?

Read More

There was a serious decline in the U.S. Treasury market on Thursday and Friday, accompanied by a sharp drop in the U.S. dollar, which backed over $1.40 against the euro. The 10-year T-note traded to yield 3.45% on Friday, and the 30-year bond almost reached 4.40%.

Yields are down slightly this morning, and the dollar is a bit stronger. (There is speculation that jitters over the North Korean nuclear blast are behind some of this action.) But it’s hard to miss a sense that sentiment is changing in this extremely important market.

Treasury securities have traded in a rather narrow range for weeks now, more or less since the stock market started rallying in early March. Typical yields for the 10-year note have ranged from 2.75 to 2.95 percent or so. (This maturity is the most critical for the economy and for the housing market.) But over just a few days, we’ve seen a sudden breakout to much higher yields in both the 10-year and the 30-year, while shorter-term yields have not moved as much. Thus, the yield curve has sharply steepened.

On Thursday morning, Standard and Poor’s changed their outlook on British government debt from “stable” to “negative.” These are terms of art which signify that S&P may at some point reduce its AAA rating on the UK. The stated reason was a lack of confidence that Britain would be able to square the circle of high public spending and poor prospects for economic growth.

That news story was followed quickly by a remark from Bill Gross (PIMCO’s chief investment officer, and one of the best bond traders in the world), that the U.S. might someday face the same fate.

About the same time, Tim Geithner was quoted as saying that medium and long-term Treasury debt is falling in price not because of a lack of confidence in the U.S. government, but rather because the economy is now recovering, and investors are ready to come out and start taking some real risk again. Have you noticed that when Geithner talks people have a tendency to assume the opposite of what he says?

So U.S. bond prices collapsed on Thursday, gold rose, and the dollar fell.

It’s entirely possible that the decline was mostly driven by technical factors. Last week was a short week, yesterday was a holiday, and today the Treasury starts up a large, three-day auction of new debt in the short-medium range of the curve. Those conditions often lead to massive short-selling by dealers, as they set themselves up to make quick profits from the Treasury’s issuance of new debt.

But the strong selling continue on Friday, when you’d ordinarily expect most market participants to already be on the harbor or on their way to the Hamptons. And the dollar and gold action doesn’t fit the pattern either.

Keep a weather eye on bond prices this week as the auction proceeds. If last week’s move was technical in nature, then we should see steady improvements in prices for the 10-year note and the 30-year bond. (The 30-year didn’t decline much faster than the 10-year, further supporting the theory that the move was technical.) But if the yield curve remains steep or gets steeper, then we’ll be asking whether there has been a sea-change in the market.

And that recalls Bill Gross’s comments last week. When you look at the prospect of the federal government standing to deficit-spend nearly $2 trillion this year alone, and almost certainly running huge deficits for many years to come, you have to ask who’s going to lend us all that money, and at what rate of interest. Several factors have so far combined to keep nominal interest rates relatively low for Treasury debt: there still is a large flight-to-quality trade as the world confronts continued economic uncertainty. The credit quality of the U.S., compared to corporate debt or the debt of other countries, is still by far the best. And of course, the Federal Reserve has been trying to keep rates low by directly monetizing (purchasing) outstanding Treasury debt.

Going beyond that, I think that the de-leveraging of U.S. businesses and individuals has a lot to do with this picture. As the private sector demands less net new credit and transitions toward holding less debt overall, that opens up supply from global investors, some of which goes to the Treasury.

But if there indeed is an economic recovery, there could be a sudden uptick in the demand for credit. At that point, it’s hard to see how we can avoid a big pulse of inflationary pressure and an updraft in interest rates. Global investors may have just started taking a close look at this possibility.

And what if interest rates rise sharply for risk-free Treasury debt over the next few years? It will only reinforce the broad trends already in place (some fundamental, some government-driven), toward lower overall returns on capital and lower economic activity.

Read Less

No Way to Run a Railroad

This week General Motors faces its deadline for giving the government its restructuring plan — the alternative being bankruptcy. GM has been working with the Obama administration on various and sundry moves to get the Goliath back on the road to profitability (or at least, solvency), and so far we’ve seen the following moves :

• A plan to outsource a good deal of auto manufacturing to China.

• The firing of the CEO (who is staying on payroll until the Obama administration decides whether or not to honor his contract and pay him his severance — hardly an academic question these days, when a contract means almost nothing to the Obama administration.)

• The dismissal of hundreds of dealers from both GM and Chrysler. (The logic of which escapes me — if the dealers are making money for GM, where is the savings in closing them down? And if they weren’t making money, why didn’t they just go out of business?)

• A proposed increase in the Corporate Average Fuel Economy (CAFE) standard to 34 MPG, likely killing off many of GM’s most profitable vehicles.

Each of these moves, in and of themselves, should give private investors serious pause for concern before putting their money in GM. There is also how the Obama administration has been strong-arming other creditors (in Chrysler’s case), wielding government money as a threat to dictate the rules, and the possibility of being left holding the bag if GM goes into bankruptcy, and the administration’s penchant for ignoring the laws governing debt hierarchy.

But what about those who “invest” in GM by buying a new vehicle? Once you find a dealer who’s still in business, get over the notion that you may be buying a vehicle made in China and not by Americans, put your faith in the Obama promise that the government will back your warranty if GM can’t, and find a vehicle that meets what Obama thinks ought to be the standards for fuel emissions as well as your own needs (good luck if you have a family!) you deserve congratulations. You hit the lottery!

Ain’t Obamanomics grand?

This week General Motors faces its deadline for giving the government its restructuring plan — the alternative being bankruptcy. GM has been working with the Obama administration on various and sundry moves to get the Goliath back on the road to profitability (or at least, solvency), and so far we’ve seen the following moves :

• A plan to outsource a good deal of auto manufacturing to China.

• The firing of the CEO (who is staying on payroll until the Obama administration decides whether or not to honor his contract and pay him his severance — hardly an academic question these days, when a contract means almost nothing to the Obama administration.)

• The dismissal of hundreds of dealers from both GM and Chrysler. (The logic of which escapes me — if the dealers are making money for GM, where is the savings in closing them down? And if they weren’t making money, why didn’t they just go out of business?)

• A proposed increase in the Corporate Average Fuel Economy (CAFE) standard to 34 MPG, likely killing off many of GM’s most profitable vehicles.

Each of these moves, in and of themselves, should give private investors serious pause for concern before putting their money in GM. There is also how the Obama administration has been strong-arming other creditors (in Chrysler’s case), wielding government money as a threat to dictate the rules, and the possibility of being left holding the bag if GM goes into bankruptcy, and the administration’s penchant for ignoring the laws governing debt hierarchy.

But what about those who “invest” in GM by buying a new vehicle? Once you find a dealer who’s still in business, get over the notion that you may be buying a vehicle made in China and not by Americans, put your faith in the Obama promise that the government will back your warranty if GM can’t, and find a vehicle that meets what Obama thinks ought to be the standards for fuel emissions as well as your own needs (good luck if you have a family!) you deserve congratulations. You hit the lottery!

Ain’t Obamanomics grand?

Read Less

It’s Sotomayor

The president has named Second Circuit Judge Sonia Sotomayor to the Supreme Court. The “smart money” had been on Seventh Circuit Judge Diane Wood whose association with the president at the University of Chicago Law School and whose intellectual muscle had some, like Jan Greenburg Crawford, calling her a “dream” pick.

But if you accept the view that nearly everything in this administration is politically driven Sotomayor makes sense. She will be acclaimed as a “breakthrough” pick and will be to some degree a harder target for senators who are always looking over their shoulders for criticism of their “insensitivity.”

Sotomayor has been roundly criticized on a number of fronts — her intellect, her frank declaration that the courts are for policy making, her high reversal rate, and her views that this “divvying up by race” is not only allowed but required by the Constitution. The issue is not whether she will be confirmed but what this will tell us about two starkly competing judicial philosophies. Americans are about to get a tutorial in judicial activism and we will see how popular it actually is. One final note: As Ed Whelan has detailed, Wood has taken some rather extreme positions on the war on terror, doubting there even is one and disparaging any sort of military tribunals. That might have been the last thing Obama wanted or needed right now.

The president has named Second Circuit Judge Sonia Sotomayor to the Supreme Court. The “smart money” had been on Seventh Circuit Judge Diane Wood whose association with the president at the University of Chicago Law School and whose intellectual muscle had some, like Jan Greenburg Crawford, calling her a “dream” pick.

But if you accept the view that nearly everything in this administration is politically driven Sotomayor makes sense. She will be acclaimed as a “breakthrough” pick and will be to some degree a harder target for senators who are always looking over their shoulders for criticism of their “insensitivity.”

Sotomayor has been roundly criticized on a number of fronts — her intellect, her frank declaration that the courts are for policy making, her high reversal rate, and her views that this “divvying up by race” is not only allowed but required by the Constitution. The issue is not whether she will be confirmed but what this will tell us about two starkly competing judicial philosophies. Americans are about to get a tutorial in judicial activism and we will see how popular it actually is. One final note: As Ed Whelan has detailed, Wood has taken some rather extreme positions on the war on terror, doubting there even is one and disparaging any sort of military tribunals. That might have been the last thing Obama wanted or needed right now.

Read Less




Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor to our site, you are allowed 8 free articles this month.
This is your first of 8 free articles.

If you are already a digital subscriber, log in here »

Print subscriber? For free access to the website and iPad, register here »

To subscribe, click here to see our subscription offers »

Please note this is an advertisement skip this ad
Clearly, you have a passion for ideas.
Subscribe today for unlimited digital access to the publication that shapes the minds of the people who shape our world.
Get for just
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor, you are allowed 8 free articles.
This is your first article.
You have read of 8 free articles this month.
YOU HAVE READ 8 OF 8
FREE ARTICLES THIS MONTH.
for full access to
CommentaryMagazine.com
INCLUDES FULL ACCESS TO:
Digital subscriber?
Print subscriber? Get free access »
Call to subscribe: 1-800-829-6270
You can also subscribe
on your computer at
CommentaryMagazine.com.
LOG IN WITH YOUR
COMMENTARY MAGAZINE ID
Don't have a CommentaryMagazine.com log in?
CREATE A COMMENTARY
LOG IN ID
Enter you email address and password below. A confirmation email will be sent to the email address that you provide.