Tuesday, January 31, 2012

Attention, Tomasky: Obama always links prosperity to fairness

Michael Tomasky warns that there's a missing link in Obama's newfound populism: while he is talking to the American people about fairness, Republicans keep talking (misleadingly) about growth.  Democrats need to win the argument about growth, because growth means jobs. And that means arguing explicitly that their policies will lead not just to shared prosperity, but to more prosperity:
What Obama needs to do more forcefully is make the next step of the argument by answering the questions: Why must fairness be restored? What will it lead to? To liberals, it’s enough that it will lead to a fairer society. Therefore, it doesn’t even occur to many liberals that the “What will it lead to?” question even needs to be answered. A fairer society is enough. But for many Americans, it’s not enough. A fairer society is fine, they think, if we can afford it. But what these Americans want is a society where there are lots of good jobs. A prosperous society. So what Obama and his speechwriters should be hoping people summarizing his speeches would say is something like: he’s for building up the middle class and making the rich pay more because things are out of whack and unfair, and because doing so will create a more prosperous society. That’s the missing piece.

I'm afraid that the missing piece is a chimera. Democrats cannot get it out of their heads that Obama just is not saying the right things. Perhaps he and his administration don't drive them home with the right sound bytes or repetitiveness -- or perhaps a populace just will not hear when unemployment is north of 8%.  Perhaps, too, Obama went semi-mute for a few months in 2011 (May to September at most) on the broad economic themes he's been repeating throughout his career on the national stage. But as long as I've been listening to the man (and reading his books and speeches), Obama has insisted that fairness and prosperity are hand-in-glove -- and that prosperity that is not broadly shared, that accrues mainly to a wealthy minority, has repeatedly (1890s, 1920s, noughties) proved unsustainable.

Monday, January 30, 2012

Eternal, ephemeral text

Dismissing Jonathan Franzen's sense that electronic text is "just not permanent enough" and his fear that future readers may lose "that hunger for something permanent and unalterable," Andrew Sullivan sees literary immortality -- for all?
Hanging out in some iCloud somewhere, the eBook will be eternal. And also more accessible to readers.
I've often had kindred thoughts, and worked some of them out when I was in children's poetry-writing mode. Below, three variations, the first two written about 2005-06 and the last one about 1994:

Mission Accomplished?

Homer's heroes thirst for glory--
to live forever in song and story.
Hector, Achilles, Odysseus,
fighting each other, fighting death,
clinging to words, on scroll or page
handed down from age to age,
saved now on the Internet -
think that they're immortal yet?

I hope this is representative

In a portrait of the Florida electorate, reeling after years of unemployment and foreclosure, the Times' Susan Saulny relays one lifelong Republican's take on the two leading contenders for the GOP nomination:
“One had those ethics violations,” he said of Mr. Gingrich, referring to his time as House speaker. “As for the other one,” he said of Mr. Romney, “he is just a liar.” 
Truth in advertising! Those impressions are wholly accurate. Just keep tearing each other up, boys. 

Sunday, January 29, 2012

By Romney Rules, Romney likes to fire people

One point about Romney's last debate performance that I buried in a footnote deserves, I think, a spotlight of its own:

Last November, Romney's campaign cut an ad that quoted Obama in '08 saying "if we talk about the economy, we'll lose"-- conveniently leaving out the fact that Obama was quoting (and mocking) the McCain camp talking about its own prospects. When called out, Romney's aides doubled down, suggesting that all's fair in love and political war:
Struggling to justify a recent television spot that reached new heights of deception, a top operative in Mitt Romney’s 2012 presidential campaign put it plainly, while insisting on anonymity:
“First of all, ads are propaganda by definition. We are in the persuasion business, the propaganda business…. Ads are agitprop…. Ads are about hyperbole, they are about editing. It’s ludicrous for them to say that an ad is taking something out of context…. All ads do that. They are manipulative pieces of persuasive art.”

In other words, because various political ads mislead to varying degrees, we're serving notice that we will distort the truth without any inhibitions.

In the CNN debate in Florida on January 26,  Romney showed that he agrees with his aides in principle. Gingrich called him out for an attack ad claiming that Gingrich called Spanish "the language of the ghetto." Romney, shamefully, claimed not to have seen the ad -- which, unlike the Super Pac attack ads he claimed not to have seen a couple of weeks ago, was created by his campaign and had his "I approved this message" imprimatur. On top of that dishonesty, Romney added the 'fuck context' defense:

Saturday, January 28, 2012

Reason vs. love, or Steven Pinker vs. Martin Luther King

To read the shorter Steven Pinker -- one of the many compressed versions of the ideas developed over 800 pages in The Better Angels of Our Nature: Why Violence Has Declined that he has published in newspapers and magazines or offered in interviews -- you might think that the driving force behind the dramatic reduction in violence over the course of human history was an expansion of empathy, the ability to enter into the feelings and sufferings of other. And so it is, to a degree. Pinker attributes the growth of empathy in large part to the development of commerce, which requires interaction, and printing, which helped expand the circle of literacy and, ultimately, the range of human experience that the literate absorb.

But fairly late in his argument, Pinker subordinates empathy to reason as a driver of the "rights revolution" -- the growing expansion of categories of people (and to a degree, now, animals) whom it becomes taboo to subject to violence of various kinds, including second class citizenship. It's reason that expands the circle:
What really has expanded is not so much a circle of empathy as a circle of rights--a commitment that other living things, no matter how distant or dissimilar, be safe from harm and exploitation. Empathy has surely been historically important in setting off epiphanies of concern for members of overlooked groups. But the epiphanies are not enough For empathy to matter, it must goad changes in policies and norms that determine how the people in those groups are treated...abstract moral argumentation is also necessary to overcome  the built-in strictures on empathy. The ultimate goal should be policies and norms that become second nature and render empathy unnecessary. Empathy, like love, is in fact not all you need (Location 13,110). 
"Empathy, like love..." But empathy is not love, not as theologians and moral philosophers -- for example, Martin Luther King -- have defined the latter. Love is bigger than empathy. In King's formulation, it encompasses something like the reason that Pinker places higher on the (social) evolutionary scale.

Thursday, January 26, 2012

Go tell the Democrats: the golden Newt-goose is dead

Newt was tamed and shamed tonight -- not only by Romney but by Wolf Blitzer. It was fascinating to see him reach for an old trick -- one that brought him glory just a week ago -- and find his hypocrisy stripped so bare that an attentive eight year old could catch it.

Immediately after attacking Romney's investments, Gingrich was asked by Wolf Blitzer if he was satisfied by Romney's release of his tax returns (for 2010, with 2011 promised). Gingrich's response, according to a partial transcript:

Cook little pot, cook!

Don't wake me...if you'd told me two months ago that the Republican presidential candidates would be tearing Mitt Romney apart like this, I would have dismissed it as wishful thinking. A Rolling Thunder Review of early primary season:
You have to live in a world of Swiss bank accounts and Cayman Island accounts and making $20 million for no work, to have some fantasy [Romney's immigration policy] this far from reality” (Gingrich, 1/25).

When Mitt Romney invented government-run healthcare, Romney advisers helped Barack Obama write the disastrous Obamacare...Romneycare sent premiums spiraling out of control, hiking premiums, squeezing household budgets...Now, desperate to save his failing campaign, Romney promises to repeal Obamacare. How can we trust him? Think you know Mitt? Think again. (Winning Our Future, ad, now running).

Wednesday, January 25, 2012

Liberal Reagan redux

E.J. Dionne compares Obama's structural approach to the SOTU to Reagan's while contrasting the two presidents' political philosophies:
Reagan laid out what became the major themes of his campaign, including not only the nation’s recovery from economic turmoil but also his central philosophical purpose: a continuing battle against “the tendency of government to grow.”

Obama’s speech was Reagan’s turned on its head. Like Reagan, Obama previewed his election arguments in a philosophically aggressive way. But Obama’s claim was the opposite of Reagan’s. Obama spoke of government’s essential role in ensuring shared prosperity and in creating an America “built to last” — a slogan drawn, perhaps not accidentally, from truck commercials for General Motors, the company whose rescue Obama engineered.

Dionne seems mildly surprised by the reverse-Reaganism:

It was to be expected that, in the course of his State of the Union address, President Obama would mention the killing of Osama bin Laden, whose death represented the culmination of the battle against terrorism that began on Sept. 11, 2001.

Far less expected was Obama’s use of the bin Laden episode to present a community-minded worldview that contrasts so sharply with the highly individualistic and anti-government message that has been heard over and over from the Republicans seeking to replace him.
The surprise is somewhat warranted by the infuriating year in which Obama directed his indignation at "Congress" and "Washington" as he tried to cut a deal with adversaries openly devoted to destroying him. But that was a detour (that ended last Labor Day). Obama's whole career -- on the national stage, at least -- has been an extended attempt to turn Reaganism on its head.

I funked a speech...

I must confess, having got up at 4:00 a.m. yesterday, I fell asleep during the SOTU! I'd like to blame Obama, because I didn't much like what I did see, but that would be unfair... I did not like the military bookends; I thought they bordered on jingoistic.  Drawing a hard line under $1 million in income for a much higher effective tax rate than anyone pays is a gimmick: the tax code needs reform, and it needs to be made more progressive, but not that way. Couldn't you cut your taxes in half by getting your reportable income down to $999k?  I did not hear any clear-cut contrast between Republican plans to further cut taxes on the wealthy and shred the safety net and a vision of the tax code that would raise sufficient new revenue while allowing for Obama's "win the future investments" (did I sleep through it?)   I remain frustrated, as I have been since 2007, by Obama's repeated pledges not to raise taxes on anyone earning less than $200k (or $250 for a family).  And jiggering the tax code to discourage outsourcing -- an elusive mirage that I remember parsing when Kerry proposed it -- is a lame centerpiece for a discussion of retooling the U.S. economy. The proposals for revamped job training and teacher incentives were studiously vague. Suddenly Obama is against teaching to the test?  Isn't that what Race to the Top has been all about? And how exactly did he say we're going to control tuition inflation?

This is obviously not the year for tax reform, and a Clintonesque blancmange may suit Obama's purposes. But the SOTU struck me as a pretty lame followup to Osawatomie, where Obama did cleanly contrast competing economic prescriptions.  Or so I thought last night.  I will try to take a closer look sometime in the next two days.

Monday, January 23, 2012

The difference between Gingrich and Romney distilled

Andrew Sullivan takes a crowbar to the political scientists' notion of a Republican "party establishment" and bends it into its new shape: a 'leadership" captured by Limbaugh and Fox, bound to adopt rhetoric and policy that runs on demonizing the opposition -- by means that Gingrich pioneered.

Reading Sullivan's precis of Gingrich's speech, it struck me that the difference between Gingrich and Romney is embedded in one phrase:
Listen to Gingrich's victory speech. It was completely, fundamentally, organizationally Manichean, if you'll pardon the expression. He limned a familiar battle between independence and dependence, pay-checks vs food stamps, America vs "Europe", the American people vs elites "forcing people" for 35 years not to be American, the traditional America vs the "secular, European style socialist bureaucratic system". There is no gray here. There is no nuance. And there is the imputation to the other side of malign motives, secret agendas and foreignness that has been Gingrich's hallmark since the very beginning, when he assaulted the traditions of the Congress until that institution eventually had to repel him (emphasis guess whose).

Sunday, January 22, 2012

Of Cohn and Karma

Jonathan Cohn worries in the wake of Gingrich's South Carolina victory:
But I know one member of the liberal media who is not giddy: Me. There’s a reason Gingrich is rallying the conservative base right now: He’s espousing some very conservative ideas. For starters, Mr. Former Speaker, what is wrong with food stamps? Gingirch is also appealing to some less than enlightened instincts. Let's face it, his victory in South Carolina probably has less to do with attacks on Bain Capital than it does with an attack on Juan Williams.
Maybe the Gingrich schtick stops working outside of South Carolina and the Republican base – and maybe, if he somehow won the nomination, he’d be the gift to Democrats that everybody supposes. That's the safe bet. But in a year that’s already proven so unpredictable, how can anybody be sure?
I know how he feels; I've expressed similar thoughts about Palin (a first: I can't find the link!). Yes, an unstable demagogue should be a lot easier for Obama to beat than a candidate who'd make a plausible president -- e.g., judging by past work product, Romney. But in a two-party system, either party nominating an unstable demagogue is a danger to democracy, both because any incumbent can be beat if economic conditions are bad enough or if catastrophe strikes, and because the takeover of one major party by extremists, reactionaries and hatemongers means we are always on the knife's edge.  The counter-argument, often expressed by Sullivan, is that only by electing an extremist and getting its clock cleaned can a party submerged in its own ideology be dragged back to the center. That may have worked in the case of Goldwater. But Goldwater was a sober statesman compared to Gingrich, Perry, Palin.

Saturday, January 21, 2012

In which I extract some hope from the news of the day

I may be following wandering fires, but I thought I picked up a couple of glimmers of hope regarding electoral trends in today's Times.

First up is a factoid accompanying Charles Blow's column. Blow's focus is on GOP voters' attitudes toward media and race. But what caught my eye in the sidebar was the percentage of the electorate as a whole who find the president trustworthy: 61%. That's far ahead of Obama's job approval rating, which is I think* 46-47% . In an era of all-time-low trust in government, 61% seems stratospheric.  If Americans even value trust in elected officials any more, it's got to help him  -- especially as Gingrich and Romney (and their hands-off Super Pac minions) do their vicious uninhibited best to highlight one another's documented lack of integrity and throw in a few gratuitous smears to boot.

The high percentage of Americans who trust Obama is comparable to the percentage who believe he negotiates with the Republicans in good faith -- approximately twice as many as those who believe the reverse. His low approval numbers are mainly an inevitable effect of the anemic economic recovery, perhaps augmented by a perception of ineffectuality that got a boost when he acceded to a no-new-revenues deficit reduction package on August 1. The public supports his "balanced" approach to deficit reduction, the measures in his jobs package, and his proposed means of paying for them, but probably blames him for not be able to get them enacted, as Steve Benen reminds us at regular intervals. Being viewed as a trustworthy conciliator, he therefore has plenty of running room to stage confrontations with Republicans in Congress and issue executive orders advancing progressive policies, as in the payroll tax cut fight, the recess appointment of Richard Cordray, and the order that health insurance plans cover birth control. If he can shore up his image as a tough, successful fighter (see: foreign policy), he will have a character troika: honest, reasonable, tough.  And I doubt anyone but bigots (and perhaps a few far-right ideologues) doubts his intelligence.

Friday, January 20, 2012

Attention, David Brooks: "Romney grits" are not the issue

Nice diversion, David.

David Brooks would have us believe with regard to Romney that "the wealth issue is a sideshow," because Romney is not a "spoiled, cossetted character," but rather a fanatic hard worker shaped by his family's persecution and pioneering grit. True enough, and point taken.

But the trust fund stereotype is a straw man.  Romney's wealth is an issue -- and a potent one at this point in American history -- not because his privileged (and demanding) upbringing spoiled him, but because, as a member of the 1% (or the point-one percent), he proposes to further cut taxes on the wealthy and shred the social safety net.  As Ezra Klein recently pointed out, Romney's budget proposals are far to the right of candidate George W. Bush's. As Jonathan Cohn adds, his cap on Federal spending at 18% of GDP puts him to the right of Paul Ryan, whose budget ends Medicare as we know it and radically reduces Social Security.

Romney's wealth is also at issue because the way he earned it encapsulates both the strength and the weakness of American capitalism in the Reagan and post-Reagan era. Bain may well have revitalized many companies that could not have survived without restructuring via the kind of strategic management the company pioneered and fostered. Bain also loaded down its purchases with debt and effectively looted some of them: the leveraged structure effectively siphoned wealth from employees to investors.  Bain, in short,  contributed both to growth and growing inequality.

Thursday, January 19, 2012

Obama the minimalist nation builder

Ever since he questioned Ryan Crocker and David Petraeus on U.S. goals in Iraq on April 8, 2008, I have noted Obama's minimalist criteria for success, first in Iraq and then in Afghanistan. Here's what he said to Crocker at that time:
I'm not suggesting that we yank all our troops out all the way. I'm trying to get to an endpoint. That's what all of us have been trying to get to.

And, see, the problem I have is if the definition of success is so high, no traces of Al Qaida and no possibility of reconstitution, a highly-effective Iraqi government, a Democratic multiethnic, multi- sectarian functioning democracy, no Iranian influence, at least not of the kind that we don't like, then that portends the possibility of us staying for 20 or 30 years.

If, on the other hand, our criteria is a messy, sloppy status quo but there's not, you know, huge outbreaks of violence, there's still corruption, but the country is struggling along, but it's not a threat to its neighbors and it's not an Al Qaida base, that seems to me an achievable goal within a measurable timeframe.
Compare what he told Fareed Zakaria about the endgame in Afghanistan in an interview published today (my emphasis):
I never believed that America could essentially deliver peace and prosperity to all of Afghanistan in a three-, four-, five-year time frame. And I think anybody who believed that didn’t know the history and the challenges facing Afghanistan. I mean, this is the third poorest country in the world, with one of the lowest literacy rates and no significant history of a strong civil service or an economy that was deeply integrated with the world economy. It’s going to take decades for Afghanistan to fully achieve its potential...

Newt blames everyone but himself for his troubles (HUGE CHEERS)

Well, we really do judge these debates like American Idol. Newt's little show of high moral dudgeon when asked at the opening gun about his ex-wife's allegations of cruel, self-serving betrayal is getting rave reviews as performance art. And it was an astounding display of the Audacity of Hubris. In the space of a minute or two, Gingrich managed to blame or condemn questioner John King, the news media, his ex-wife and Barack Obama for his being forced to address the consequences of his serial adultery. Let's consider the substance:
I will respond. I think that the destructive, vicious, negative nature of much of the news media makes it harder to govern this country and get decent people to run for office. I am appalled you would begin a presidential debate with a topic like that. (HUGE CHEERS). Every person in here knows personal pain. Every person in here has had someone go through personal things. To take an ex wife and make it two days before the primary is as close to despicable as anything I can imagine. My two daughters wrote the head of ABC and made the point that it was wrong, they should pull it, and I am astounded that CNN would take trash like that and open a presidential debate. Don’t try to blame someone else, YOU chose to start this debate with this. The story is false, personal friends attest it is false, ABC is not interested because the media just wants to protect Barack Obama and attack Republicans.  I am tired of the elite media doing this. (HUGE CHEERS)
We begin with projection. The question is whether Newt is a decent person: the evidence is overwhelming that he's not. Confronted with that evidence, it's the media's job to raise the question.And "destructive, vicious, negative nature" is a pitch-perfect description of Newt and the way he's conducted political warfare for thirty years, and the way he's taught his party to conduct it.

Every person here knows personal pain. Right -- the question is how much of it they've inflicted on others. I am astounded that CNN would take trash like that and open a presidential debate. Trash = the allegations of his second wife, strikingly similar to the allegations of his first wife. Unchallenged: that he left both for women he had been carrying on affairs with (one of whom was his second wife). Trash to the trash!  ABC is not interested because the media just wants to protect Barack Obama and attack Republicans.  Gather round me, fellow Republicans!  And they did -- no one had stomach to press the attack.  

Bulletin,  Newt:  Barack Obama protected himself -- by not exposing himself to his wife and the world as the most self-serving deceptive, treacherous and cruel cad on the national stage.

All those pieties about forgiveness with which Newt's rivals dodged confronting him on this front are just so much Christianist crap.  Newt's ex-wife can forgive him if she will -- and his daughters, as they claim to. The rest of us have nothing to forgive because he did us no harm (excepting his Republican colleagues, whose crusade against Clinton he undermined).  But at our peril would we forbear to judge his character and fail to recognize him for the treacherous fraud he is.

Wednesday, January 18, 2012

Bill Clinton's post-mortem on 2010

In an in-depth interview in Esquire, Bill Clinton delivers a detailed recap of recent U.S. political history that's for the most part economically determinist: Democrats were bound to win in '08, Republicans in '10.  But I have one bone to pick. Clinton alleges a couple of messaging errors & omissions on Obama's part, starting with this:
There was no way people could feel fixed in 2010. So I wish now, and I'm not — I didn't see it, either — but I wish now that we had all known enough about this on September 16, 2008, when we still had a debate or two to go, and that the president could have said, "You know, I've just looked at this. This kind of thing is happening to us now, first we gotta keep everything from cratering, and that means we'll have to help some people who contributed to the problem. I hate that, but I can't let your financial system go down. I can't let it be so you can't use your credit card.

True, there was a debate or two to go. And on October 7, 2008 Obama was asked by an audience member how the $700 billion bank bailout would help ordinary people who are "having a hard time." His response:

Tuesday, January 17, 2012

The Perry Way of defamation

Ever since he first strutted stiff-spined onto the presidential candidates' stage, Rick Perry has struck me as a danger to democracy  -- the purest thug in that confederacy of charlatans, demagogues and ideologues that constitute the GOP field. Time after time, I've felt compelled to point out the pattern of his verbal aggression: escalate a garden-variety policy difference or critique with the most inflammatory of slurs, and justify the slur by insisting that since there is some criticism to be leveled at the target, any insult will do.  Social Security is a "criminal enterprise" because its funding may need to be tweaked; Fed Chairman Ben Bernanke is "almost treasonous" because his policies may help Obama; Obama is opposed to the country's founding ideals because Perry is pleased to label his mainstream Democratic policies "socialist."

The latest target of Perry's signature mode of verbal assault is Turkey. In last night's debate in South Carolina, asked whether Turkey, having allegedly "embraced" Hamas and "threatened military force against Israel and Cypress, still belongs in NATO, Perry called Turkey "a country that is being ruled by, what many would perceive to be Islamic terrorists." Note, for starters, the recourse to vaguely defined authority: "what many would perceive." That's a typical Perry dodge: his trademark slur for Social Security is okay because "calling Social Security a Ponzi scheme has been used for years. I don’t think people should be surprised that terminology would be used." 

Today, after Turkey's foreign minister condemned the slur, both Perry and his spox Victoria Coates defended it in Perry's usual terms. That is: because some criticism of Turkey might be legitimate, the most inflammatory insult is legitimate.  Coates had recourse to that 'other people say' dodge:  

Monday, January 16, 2012

Thank GOP voters for small favors

If there has been one silver line in the long disgusting spectacle of the GOP nomination contest, it's the failure of Rick Perry to get any traction. As Jonathan Bernstein reminded us early and often, Perry -- a three-term governor of the largest Republican state, with an at least superficially impressive job creation record and an enormous war chest-- was the candidate best positioned to win, or at least give Mitt Romney a serious run. He's failed to break into the top four purely by virtue of proving himself too stupid and (perhaps) cruel and abusive even for Republican primary voters.  Tonight he was in top form -- calling Turkey's leaders terrorists and lumping this NATO member with Iran and Syria, defending the U.S. marines who urinated on Afghan corpses on the grounds that their crime was not as bad as the beheading of Daniel Pearl, and declaring a state of war between the U.S. and South Carolina and between the U.S. and "religion."

While Republicans are going to nominate a shameless liar, they have forborne to elevate an incompetent, a religious fanatic or a fascist. 

Tonight, for the first time, I got fully into the swing of debate-tweeting. Some live impressions @xpostfactoid1.

Better Angels in Super Hornets

The continued U.S. military engagement on behalf of Hamid Karzai's government in Afghanistan is viewed by increasing numbers of Americans as a legacy struggle -- seen to varying degrees from different perspectives as wasteful, futile, brutal.  Maybe so. At the same, whatever the prospects for success however defined, the manner of its fighting illustrates a major thesis of Steven Pinker's The Better Angels of Our Nature: Why Violence Has Declined: that great powers' recourse to violence grows ever more calibrated and proportional.

Given the waste of the Iraq war, the mishandling of the one in Afghanistan, the hundred-plus thousand lives lost in the one and the tens of thousands in the other, the claim may seem callous and polyannish. Compared to past conflicts of like scope, however, it true nonetheless, and increasingly so.  Today's front-page New York Times report by C.J. Chivers on changing U.S. aerial tactics in Afghanistan provides a striking illustration.  One navy flight commander's experience illustrates the current m.o.:

Shooting skeet was excellent practice. It taught them to shoot skeet."*

In today's Times, Michael Winerip spotlights an important limitation to a widely publicized longitudinal study that found that elementary school teachers who significantly raise students' test scores have a positive impact on their long-term prospects.Winerip notes that the testing in question took place before the era of "high-stakes testing," in which teachers are under relentless pressure to teach to the test and curricula are bent to that end.  Winerip's caveat:
Whether those results are applicable to our post-2004 high-stakes world, we cannot tell. It may well be that teachers under pressure to raise their students’ scores through extensive test preparation will get inflated results that do not carry over positively to adulthood.
There's a kind of Heisenberg Uncertainty Principle at work: if you teach to the test, the test results have a different import. Winerip concludes with a personal anecdote that I can bookend with my later experience as a parent:

Saturday, January 14, 2012

On leveraged debt bondage

The best articles about Romney, Bain and private equity as it's developed over the last thirty years make it clear that it's very difficult to draw a fair scorecard. Private equity firms can deploy strategic smarts and managerial skill to turn around troubled companies or turbo-charge successful ones; they can also load down their purchased companies with debt, denude them with fees and dividend payouts, and sell them off before chickens come home to roost. Whether PE-owned companies thrive or fail, we never know how they would have done under prior or different ownership. The story of private equity since about 1980 is very much of a piece with the story of American capitalism: impressive growth, but with gains going disproportionately to the very top in a game that seems ever more rigged.

When PE firms (including Bain) do drive a portfolio company into bankruptcy, it's often the result of saddling it with debt.  That highlights a basic fact about private equity that I could never quite wrap my head around: when an investment firm or fund uses mainly borrowed money to buy a company, why should the purchased company own that debt?

Steven Rattner, in a defense of Bain, relays the investor's rationale for high leverage:

Friday, January 13, 2012

Erasing the King of Bain Stain

Romney should be able to beat the King of Bain rap. The film is so obviously over the top in its vilification, it has 'smear' written all over it from the moment the narrator intones menacingly, near the outset, that Bain Capital was initially funded by Latin American money.  Its presentation of every factory closure it treats has been shown to be distorted: either the troubles started well before Bain came on the scene, or after Romney left, or in several stages under several changes of ownership. Even Newt is now demanding that his Pac either fix every error or take the film down -- as if the old demonizing fraudster didn't know perfectly well last week, when he was urging debate viewers to watch it and judge for themselves, that there was not an undistorted fact in the whole.

And yet. Distorted does not mean entirely devoid of truth. The closures were real; Bain did push some companies into or towards bankruptcy by overloading them with debt; and when Romney is shown asking "whose pockets" corporate profits flow into, the film provides a clear answer: disproportionately into his and those of his ilk.

Thursday, January 12, 2012

Santorum promises universal daycare!

Igor Volsky relays the historic announcement live:
Santorum: "This is an election about whether you're going to leave your children free. Period.

Citizens Divided via SuperPac

As anti-Romney billionaires fund SuperPacs in support of Gingrich, Huntsman and Santorum, it's obvious that the Citizens United decision has remade the political playing field.  What has traditionally been big money in campaign finance  -- say, $15 million in a quarter raised by a candidate for a major-party presidential nomination -- is chump change to the likes of Sheldon Adelson, Foster Friess and Jon Huntsman, Sr. (their contributions thus far may reach only a large fraction of that level, but give them time). Any candidate who shows a pulse can be insta-funded; any attack that suits a billionaire's agenda can be micro-targeted or broadcast.  A nomination that would be wrapped up under the old rules may not still be competitive - -but the level of advertising attack that Romney and Gingrich have sustained or will sustain is unprecedented in a primary race.

In some cases, American voters have shown some antibodies against campaign advertising (see: Huckabee, Iowa; Santorum, Iowa).   We're going to have to develop stronger ones. Perhaps the barrage of internecine attacks will be self-cancelling.

Or maybe, just maybe, if enough Republicans are gored and gutted this cycle by SuperPacAttacks, we'll see a new round of campaign finance reform.  Especially if they destroy their nominee.

P.S. How about a billionaires' truce? Warren Buffett, on behalf of Obama, promises to match all SuperPac funding on the GOP side -- and they all agree to keep their money instead.

Tuesday, January 10, 2012

Tell us more, David Brooks: why do Americans mistrust government?

David Brooks makes a fair point today: Americans' lack of trust in government undermines liberalism.  But then he can't forbear to give his bias enough play to blame Democrats almost equally for this sad state of affairs.   His diagnosis skips or elides key drivers of this lack of trust.

First, it's cultural. Americans have been railing against the federal government since before it existed. The ratification debate was rife with fear that a tyranny was being established, a fear shared by many members of the Constitutional Convention.  Six-year Senate terms, lifetime judgeships, a vice president with feet in two branches of government, direct taxing power -- all were excoriated as instruments of tyranny. A few decades later, states' rights became the battle cry and vehicle for those who so resented any impingement -- or potential impingement -- on their "right" to hold slaves that they established their own weak confederacy custom-designed to leave them to their pleasures of personal dominion.

Monday, January 09, 2012

True Newt, false Newt

Hate-mongering demagogue though he may be, Newt Gingrich spoke one truth and illustrated another in a response to one question from moderator David Gregory in yesterday's GOP debate in New Hampshire:

GREGORY: Speaker Gingrich, if you become President Gingrich and the leader of the Democrats, Harry Reed says he’s going to promise to make you a one term president, how would you propose to work with someone like that in order to achieve results in Washington?

GINGRICH: I think every president who works with the leader of every opposition knows they’re working with someone who wants to make them a one term president. I mean you know that -- that’s the American process. I worked with Ronald Reagan in the early 1990’s. Tip O’Neil was speaker. He wanted to make Reagan a one term president. We had to get one-third of the Democrats to vote for the Reagan tax cuts and we did.

Sunday, January 08, 2012

Perry keeps skidding on smears

Give Rick Perry credit for consistency. His primary mode of political communication remains the smear.  To be more precise, his default mode of attack is the inflammatory insult used to articulate a garden-variety policy disagreement.

Note the structural similarities between two Perry attacks, one made in today's New Hampshire debate
and one made four months ago. Today:
HILLER: Governor Perry, your party’s last nominee, John McCain wrote in the Washington Post in an op-ed about a year ago, his words, “I disagree with many of the president’s policies but I believe he is a patriot, sincerely intent on using his time in office to advance our country’s cause. I reject accusations that his policies and beliefs make him unworthy to lead America, or opposed to its founding ideals.” Agree?

PERRY: I make a very proud statement and, in fact that we have a president that’s a socialist. I don’t think our founding fathers wanted America to be a socialist country. So I disagree with that premise that somehow or another that President Obama reflects our founding fathers. He doesn’t. He talks about having a more powerful, more centralized, more consuming and costly federal government.
And on September 15, in a Time Magazine interview:

Santorum double-blind

The core of Rick Santorum's domestic policy and governing philosophy is to boost the two-parent family. That's his anti-poverty program. Here he is in today's debate in New Hampshire:
And I believe that there’s one thing that is undermining this country, and it is the breakdown of the American family. It’s undermining our economy. You see the rates of poverty among single- parent families, which are -- moms are doing heroic things, but it’s harder. It’s five times higher in a single-parent family.

We -- we know there’s certain things that work in America. The Brookings Institute came out with a study just a few -- couple of years ago that said, if you graduate from high school, and if you work, and if you’re a man, if you marry, if you’re a woman, if you marry before you have children, you have a 2 percent chance of being in poverty in America. And to be above the median income, if you do those three things, 77 percent chance of being above the median income.

Friday, January 06, 2012

Socratic Santorum sidetracks students

Rick Santorum laid a bit of a trap yesterday for some indignant college kids who confronted him about gay marriage at a student convention in Concord, NH yesterday.  David Corn recounts:
Two students asked Santorum how he could justify this opposition with his opening remarks that focused on the guarantee, enshrined in the Declaration of Independence, that no American shall be deprived of the "pursuit of happiness."

"So anyone can marry several people?" Santorum asked. "What about three men?"
Santorum...asked the students to justify gay marriage. When one said, "How about the idea that all men are created equal and [have] the right to happiness and liberty," Santorum asked, Are you saying that everyone should have the right to marry anyone?
The student said yes. And Santorum quickly retorted. "So anyone can marry several people?"

No, the student said.
But what if someone can only be happy if he or she was married to five people? Santorum asked her.

Others in the crowd starting jeering him. "That's not the point," one shouted.

But Santorum, who kept cutting off the students, stuck to this argument. When the students talked about equal rights, he repeatedly interrupted, "What about three men?"

"That's irrelevant," one of the students said.

"No, it's not," he said.

"That's not what I'm talking about," she said.

With a smile, Santorum said, "If we're going to have a conversation based on rational, reasonable thought…if people say it's okay for two, then you have to say why it's not right for three."

Santorum was diverting the students (with some success, it seems; I can't find a full transcript).  He was suggesting that their argument was that the state has no right to regulate or define marriage.   The question is on what basis the state excludes some relationships from marital status. For Santorum, it comes down to God's law:

Wednesday, January 04, 2012

Paint Romney as flip-flopper or right-winger? Both/and!

Methinks New York Times reporter Helene Cooper has posed a false choice for the Obama campaign.  But then, John Sides and Kevin Drum both accept the terms, so maybe I'm missing something.

As a plan of attack against Romney, Cooper asks:
Do they go the flip-flopper route? Or do they go the out-of-touch, protector-of-Wall-Street route?
Cooper acknowledges that the two paths may not be mutually exclusive. But then, recounting the campaign's pursuit of the flip-flopper meme, she undercuts that caveat:

Tuesday, January 03, 2012

Gingrich goes Bob Dole one better

Lore has it (who knows, maybe the polling data doesn't back it) that Bob Dole disqualified himself for the presidential nomination in 1988 with a testy challenge to George H. W. Bush: stop lying about my record. That was in response to a Bush ad accusing Dole of "straddling" on taxes.

Newt Gingrich, who knows he's going nowhere and counts himself destroyed by Romney's hands-off SuperPac ads, has defined intraparty decency down down down. On CBS this morning, he told Mitt Romney to stop lying about...everything.  Recap below starts with a question by Norah O'Donnell:

Monday, January 02, 2012

Obama through the looking glass(es)

Obama is a radical socialist who vastly increased government spending, saddled our grandchildren with debt and expanded government control of every aspect of Americans' lives.

Obama is a naive weakling who let Republicans frame the agenda in 2011, was seduced by a siren song of compromise, and capitulated to the Tea Party hostage-takers, agreeing to massive spending cuts without winning any revenue increases. 

I'd like to accuse Republicans of the doublethink required to embrace both narratives, but they never really bought into the second -- at best, they projected "weak Obama" onto the foreign policy stage (a bit of a stretch in light of Obama's apparent 'got the sucker' lethality, whatever you think of the wisdom of his various covert and low-key military operations). The capitulator-in-chief narrative belongs to disappointed progressives.

Still, given the Rube Goldberg two-stroke spending cut apparatus that Obama signed onto on August 1 this year, I have a hard time wrapping my head around the Wall Street Journal editorialists' lump-of-coal lament today: