Rossputin.com: Rational Thinking About Our World

2007 was a year I could have done without.

Other than the joy of watching my daughter turn into a real little person with a real personality, 2007 didn't bring a lot of good to me or my friends.

In the last month, an acquaintance has died, a very close cousin of a friend was murdered, and another friend's grandmother died.

As if that weren't enough, I was diagnosed with a tumor on my small intestine and I'm having fairly major surgery on Friday. It appears that the tumor is the only problem...there's no current evidence of any spreading. Still, what a horrible way to end an already bad year...wondering if I have a medical problem that's going to kill me. (It appears that it won't, but I won't really know for sure until I've been through several years of monitoring.)

Financially, it was a rough year, and two close friends also had disastrous years in that area.

Besides watching Lili grow up, the other good thing for me in 2007 is that Kristen (my wife) is pregnant, and due within a month with our second child...this one a son.

I suppose, putting things in perspective, that seeing Lili grow up smart and happy and healthy, and watching my wife get close to delivering another one outweighs the trials and tribulations of 2007...even learning that I need surgery.

So, while 2007 wasn't a total disaster for me, it was still one of my worst years ever and I'll be all too glad to see it gone.

The only thing which might make 2008 worse than 2007 is if a Democrat wins the presidency in November...

Since it's a week when many people are traveling and not web surfing, I'm taking it a bit easy myself with the writing.

For today's thought-provoking entry, allow me to refer you to this excellent 3-minute commentary by George Mason University economist Russ Roberts:

http://www.npr.org/templates/story/story.php?storyId=17625560

News sources are reporting this morning that former Pakistan Prime Minister Benazir Bhutto has been killed, apparently shot during a larger attack just after a rally for Ms. Bhutto, now dead at the age of 54.

It appears there was a bomb which may have been used to force Bhutto to move, and then she was apparently shot multiple times. The initial reports also imply that the explosion may have been after the shooting, with the murderer blowing himself up.

There really are no "good guys" in Pakistani politics, just as it's difficult to find a good guy in any middle eastern country. However, Bhutto represented the country's best chance for something that looked like Democracy and an open mind toward western ideas (including being a role model for diminishing the subjugation of women in that part of the world.)

The primary suspects for this murder by pundits outside Pakistan will be supporters of the Taliban and Al Qaeda who, as Ambassador Marc Ginsberg said, recognized that Bhutto "constitutes the most important threat to extremism in the country. She's a democrat. She's western-oriented. She's an ally of the United States."

But within Pakistan, suspicion is focused on elements of the Musharraf government due to people knowing of a letter that Bhutto sent to Musharraf in which Bhutto said that people within his government want to kill her. It is more than possible that people whose political power or wealth is dependent on President Musharraf could have wanted her dead. Indeed, Stratfor believes that the "assassination could not have been possible without the jihadists being enabled by elements within the government" out of fear of Bhutto's party having a very strong showing in the upcoming elections on January 8th.

It's critical now, for the stability of the country, that Musharraf begin an investigation, preferably by as credible an independent investigative person or group which can be found or created in Pakistan. This investigation must not only find the organizers of the murder, but must try them publicly and then execute them...preferably also publicly...including (or especially) if those people work for the ISI or some other arm of the government's intelligence or security apparatus.

While Musharraf and his allies might be tempted to see Bhutto's death as good news, that would be a serious error on their part. Instead, they must take up her mantle and work publicly and aggressively to bring Bhutto's democratic ideals to fruition within the country. Anything else is a recipe for continuing dissent in the country, leaving the opening for Islamic extremists to increase their military and political power. It represents Edmund Burke's warning "All that is necessary for the triumph of evil is that good men do nothing." While Musharraf is not easily placed in the category of "good men", he is the closest we have today.

In the meantime, it is likely that Bhutto supporters and maybe supporters of Nawaz Sharif, the other opposition leader and former Prime Minister will boycott the upcoming elections to cast further doubt on his legitimacy. Interestingly, although Bhutto's death is getting all the press, several people were killed at a pro-Sharif rally in Rawalpindi, the same town where Bhutto was killed just four hours later, apparently by supporters of Musharraf. Sharif was only about a mile away, on his way to the rally, so this could have been intended as an attempt to eliminate both of Musharraf's electoral competitors within 24 hours of each other. This event makes it appear that much more likely that Musharraf either had a hand in, or at least was powerless to prevent, these attacks.

This is leading to unrest in the streets of Pakistan, with pro-Democracy supporters verbally attacking Musharraf and leading the country toward further instability...leaving just the sort of chaotic situation in which extremism thrives. It would not be very surprising to see civilian protesters fighting government forces in the streets in coming days. It will be necessary for the US to force Musharraf to give up some or all power but it will also require a credible figure to assume that power, with the most credible such person now dead. As we see unrest (and hopefully not civil war), we must not forget that Pakistan has nuclear weapons.

Beyond the importance of this for Pakistan, it is critical for the US. Pakistan is possibly the most important country in our "War on Terror", not least because of its border with Afghanistan and it's wild-west-like frontier territories which are currently a safe haven for Taliban and Al Qaeda operatives and training camps. Musharraf has played patty-cake with those people for too long, in part because he did not feel politically strong enough to take them on. Thus, creating political unity (or some Pakistani version of it) which can give the government enough confidence to fight our mutual enemies is of utmost importance to the safety of Americans.

[Domestically speaking, this event can have some important effects on the upcoming primaries, with the candidates who argue that they have strong international and anti-terrorism credentials such as Hillary Clinton, Rudy Giuliani, and John McCain, using this to attack opponents who have no substantial experience in these areas...such as Barack Obama and Mike Huckabee.]

Bhutto is dead, but her recent political legacy must live on. The security of Americans as well as the quality of life for all Pakistanis depends on it.

I've learned that frequently the best compromise is one in which both sides end up somewhat unhappy. And if I'm party to such a compromise, I suppose I have to hope that I'm a bit less unhappy than the other guy.

Such is the case with the massive $555 billion omnibus spending bill signed by President Bush on Wednesday.

Bush complained about $10 billion contained in 9,800 earmarks, but at the end of the day Bush was the clear political winner of this battle.

The bill, which was a compilation of eleven spending bills and additional war funding, included money for the Iraq war without attaching a time line, or as some call it, a date for surrender.

A rather strange statement followed Bush's signature:

“This legislation contains certain provisions similar to those found in prior appropriations bills passed by the Congress that might be construed to be inconsistent with my Constitutional responsibilities. To avoid such potential infirmities, the executive branch will interpret and construe such provisions in the same manner as I have previously stated in regard to similar provisions.”

I don't quite know what this means, although it sounds disturbingly like the single biggest failure of George W. Bush's presidency: Signing the McCain-Feingold Incumbent Protection Act while acknowledging that he believed it to be unconstitutional.

As if the NetRoots won't be unhappy enough about funding the war without surrender, the Democrat Congress abandoned Charlie Rangel's "Mother of All Tax Hikes" (OK, he said "reforms", not "hikes", but my version is more accurate) to send to the President a bill which put a one-year "freeze" on the Alternative Minimum Tax ("AMT"), keeping it from hitting an additional 20 million taxpayers on their 2007 returns.

It is pleasantly astonishing to see Democrats be completely unable to use their majorities in both houses of Congress to pass tax hikes and surrenders despite a president with very low approval ratings.

While I don't think there's any chance of the GOP taking back either chamber in the next election, this type of result should give Republican presidential candidates some hope...and give voters a hint of a reason to vote to put a Republican in the White House.

Indeed, Americans have shown relatively consistent wisdom by keeping our government divided for most of the past generation. If there's anything we should learn from our modern history, from FDR to George W. Bush, it's that we don't want one party to control the executive and legislative branches simultaneously. For that reason, I continue to believe (though I wouldn't bet a lot on it) that a Republican will win the White House, but will not have any coattails. And that's fine with me, although I would prefer the Democrats not gain a veto-proof majority throughout Congress.

For today's reading, allow me to offer you this article by David Harsanyi, the Denver Post's "token conservative" (although I think he's closer to libertarian) and author of a book with an important subject and a very long title:
Nanny State: How Food Fascists, Teetotaling Do-Gooders, Priggish Moralists, and other Boneheaded Bureaucrats are Turning America into a Nation of Children

Here's the article:
Hope still abides amid the doom and gloom, David Harsanyi, Denver Post, 12/24/07
http://www.denverpost.com/opinion/ci_7801170

With all the negativity and apprehension engulfing this nation, it's a wonder any of us can be thankful this year.

Today's compliant American citizen trembles in fear at the slightest sign of peril.

You know, if Osama doesn't get us, Chinese toys certainly will.

All this doom and gloom has manifested in the rise of populist politics, an unfortunate movement that seizes on every morsel of bad news it can exploit for political power.

You, on the other hand, are left to sit, curled up in the corner, agonizing over the proliferation of Mountain Dew, Mexican gardeners after your job, lead in your lipstick and polycarbonate bottles — whatever that is.

Now, no one can deny that we're a nation dealing with a multitude of crucial problems. We are, after all, home to Miss South Carolina, Dennis Kucinich and "Dancing with the Stars."

Still, it's no reason to panic.

For instance, there is no doubt an economic slowdown is on the horizon — as it always is. (Rest assured that every Chicken Little will take credit for seeing it coming.)

As of today, however, unemployment remains at near-historic lows. Nationally, wages rose 3.8 percent — a point in front of inflation — this past year. The current economic expansion is now in its 74th month, which, according to free-market economist Larry Kudlow, is 17 months longer than the average growth since World War II.

Economic prosperity is a rather dull story, though. Clearly, the country would rather wring its germ-infested hands at the wondrous disaster that is the sisters Spears. How can we ignore such golden fodder?

No study is yet available on how many women voluntarily shave their heads and attack paparazzi — though one is surely on the way.

Yet, as the holier-than-thous sprint for microphones, ready to relay all the gory details of our moral collapse, one might point out that teenage pregnancies, though they rose slightly this past year, had fallen for 14 consecutive years, according to the Centers for Disease Control and Prevention.

Criminal violence — despite all those first-person, super-violent video games and scary movies — has also declined dramatically since 1994.

In the end, prosperity means more than the ability to watch pop stars descend into madness — although no one can deny its entertainment value. It also means security, comfort and enhanced health.

The harbinger of economic collapse has been the tear-jerky subprime mortgage meltdown. Yet, with all the trouble, it might be worth remembering that nearly 70 percent of Americans own the home they live in. This fact brings stability, both economic and personal.

And many of those folks will be paying off every last mortgage payment.

According to the CDC, a child born in the United States should expect to live to around 78 years — if he or she meticulously avoids secondhand smoke and trans fats. A new high, life expectancy has risen from a mere 69 years in 1955.

Then again, you may view this as simply horrible news once you get your first glimpse of your kid's college tuition. Unlike 20 years ago, nearly every kid seems to go to college.

Ostensibly, this means kids will be better educated and less ignorant. Hopefully, they will live even longer and more prosperous lives.

Just avoid red meat, mercury-infested fish and caffeine, etc. (though this could all change next week).

Apparently, if they're to live forever, they will also be miserable.

But I'm not sure why we're so unhappy. Perhaps change and uncertainly will always make us fearful of the future.

Let's hope those college kids will be more resistant to scary studies and populist shock and awe.

Through it all, there's only one thing they should remember: Try as you may, no one gets out alive.

Oh, and Merry Christmas!

To all my Christian friends (and anyone else willing to accept it), I wish you a very merry Christmas.

re "Taxes Are Reassessed in Housing Slump as Prices Drop" (NY Times, 12/23/07)
http://www.nytimes.com/2007/12/23/us/23tax.html?hp

To the editor:

It is exceptionally rare to find a government which deals with declining tax revenue by any method other than trying to scare its citizens into raising tax rates. From “rapists will go free” to “children will starve in the streets”, taxpayers are (or should be) tired of hearing these variations on the same greedy theme.

Declines in home values will no doubt bring another coda, this time something like “If you don’t agree to higher property tax rates to compensate the county for declining home values, we will have to fire teachers and security guards and cut back on school lunches”. In other words, they’ll threaten to make our kids stupid, unsafe, and hungry unless we give them more of our money rather than their finding the sorts of efficiencies that every business and family must make in tough economic times.

Although it’s been a long time since we’ve had a real downturn in the housing market, the funding of public education based on property values has always been a vulnerability. Instead of just coughing up more money for more dismal public school performance, this economic event should be a catalyst for school choice, including changing the system of funding public education.

I received quite a few comments to my December 20th posting entitled "Huckabee is not a Republican...or shouldn't be"

Many of them were making what I thought were incorrect or simply silly arguments. I was waiting for a few to pile up in order to address them at once, but I was beaten to the punch by a reader, Ben, who submitted this excellent response. Thanks, Ben, for saving me some work.

Nearly all of the above comments deserve responses. I am a social conservative, a fiscal conservative, and a lifelong Republican. Here goes:

To Gerand, you are setting up a straw-man argument. Of course, states have the right of taxation. What Rossputin was pointing out was Huck's overall trend in tax policy, which is not good by a fiscally conservative Republican standard.

To Muwattalis, your read of the immigration debate is oversimplified and misleading. You are going to have to do a whole lot more heavy lifting (or at least sourcing) to show how "libertarianism is in political free fall." Your read of the immigration debate is also largely irrelevant here, since Huck himself is a newcomer to the strong enforcement side - which in fact muddles his otherwise populist views.

Some of us happen to be social and fiscal conservatives. The two wings of the party need each other. Why not pick a candidate who reflects both, rather than one who splits the party and destroys the agendas of both?

To nobodyislistening, simply plastering labels on those who disagree with you as "country club Republicans" only shows the weakness of your position. Hurling these epithets at someone like Rossputin (or, if you care to, me) only diminishes your credibility.

A true conservative? It means more than just being pro-life and pro-traditional marriage. In addition to the fiscal shortcomings so eloquently written about in this post, what about Huck's naive foreign policy that sounds like echoes of Barack Obama? Is this the guy you want as commander-in-chief in a time of war?

To Mark Rolfes, your comment is a total non-sequitur. Like Rossputin and me, you say you are animated by frustration with the lack of fiscal discipline shown by Congressional Republicans. How does that translate into support for Huckabee (who has been anything but an advocate for limited government)? McCain, maybe, for his lead on earmark reform, but he also pushed the giant Medicare expansion. Please clue me in here.

In summary, for all I know, most of the commenters here might be working for the Huckabee camp, since there are no links to follow that would identify them. That being said, their arguments need to be refuted. I'm writing to implore GOP primary voters to think seriously about their decisions. If you're going to support Huckabee, fine, but only if you at least got there by coming to grips with his record and having given some thought to a couple broad questions: 1) What would his foreign and domestic policy prescriptions really mean for our country? and 2) What are the odds he could actually win a general election?

Writing as a Baptist born-again Christian, let me remind you we are electing a President, not a pastor.

I would like to re-emphasize what I think is a crucial point in politics, specifically Republican politics, which I made in the original article:

The Republican Party is indeed a “big tent”. There is room for widely ranging views on a wide range of issues, from social issues to immigration to the war in Iraq. But supporting bigger government and higher taxes is not bringing a new view into the tent; it is burning down the tent, the very fabric of which is made of respect for liberty and limited government.

I know who Ben is, and I know that he thinks about politics and public policy a lot. I think it's quite interesting that people whose religious views are as different as his and mine (he a religious Christian and me a not-particularly-religious Jew) can come so close to agreement on so many things. And that's because we both realize that while a person's faith may guide his decision-making to a degree, following religious doctrine simply must not be the primary goal or modus operandi of a politician.

Think about Iraq: We're trying hard to keep the mullah's from imposing a government based on sharia (Islamic religious law), but we're not trying to eliminate religion from the country. And could you imagine any other approach that would have any chance of success in a very religious place with multiple groups of very strongly held differing opinions?

Well, the US is the most religious industrialized country. Is there any rational argument for making a Baptist pastor (whose every statement comes back to his religion being the most important thing in his life) the president of a nation which has, for example, more Catholics than Baptists, and has plenty of people of other denominations of Christianity as well as Jews, Hindus, etc?

I don't ask this from a politically correct point of view. I couldn't really care less about the liberals' talk of "diversity". My point is that Mitt Romney had something sort of wrong: What made America great was not just Freedom of Religion, but also Freedom from Religion in the sense of a state-sponsored religion, such as in England where the King or Queen is also head of the church. People must be free not to have the religion of others imposed on them through public policy. Let religious decisions or a Huckabee-style Christian version of Sharia be enacted in peoples' own homes if they want to live that way, or worst case at a state level. Our country is great precisely because we have tended to keep people like Mike Huckabee out of the White House.

Thanks to Patrick for sending me these stories...

First (because it's shorter, not more important than the second item), allow me to recommend to you this excellent tidbit:

Year of global cooling, Washington Times, 12/19/07
http://www.washingtontimes.com/apps/pbcs.dll/article?AID=/20071219/COMMENTARY/10575140

Second, but more important:

Senator James Inhofe is one of the few voices of reason about climate change left in the ranks of politicians. As such, he had the following report compiled. It is valuable not only for pointing out how big a lie it is when people like Al Gore say "the debate is over" but also as a reference to further resources on the issue of "global warming".

See a "new report issued by the Senate Environment and Public Works Committee's office of the GOP Ranking Member":
U.S. Senate Report: Over 400 Prominent Scientists Disputed Man-Made Global Warming Claims in 2007
Senate Report Debunks "Consensus"
http://epw.senate.gov/public/index.cfm?FuseAction=Minority.SenateReport

(A shorter summary of the report is available at:
http://epw.senate.gov/public/index.cfm?FuseAction=Minority.Blogs&ContentRecord_id=f80a6386-802a-23ad-40c8-3c63dc2d02cb)

I would also offer you Senator Inhofe's "A Skeptic’s Guide to Debunking Global Warming Alarmism"
(Left-click above to read or right-click to download)

And finally, an interesting article by Arnold Kling:
My Global Warming Question, Arnold Kling, TCS Daily, 12/21/07
http://www.tcsdaily.com/article.aspx?id=122107A

A version of this article was also published at RealClearPolitics.com

A common criticism of the primary process is that it lets activists who are not necessarily representative of the general population have an outsized impact on the selection of the nominees.

Every once in a while, a high-profile early primary victory reminds of that, such as when Pat Buchanan won the New Hampshire primary in 1996 despite his being unlikely to get the party’s nomination and his certain inability to win the general election.

We may be on the verge of another similar moment as we watch Mike Huckabee’s current surge. Republicans must not be so unintelligent that they nominate Huckabee as the GOP candidate for president because the American voters are too smart to elect him.

During the 2006 campaign, the only emails I received which argued that the GOP would maintain its majorities in both houses of Congress came from social conservatives. After the Republicans’ electoral bloodbath, those notes reminded me of Pauline Kael’s famous quote about the 1972 election: “I don’t know how Nixon could have been elected; nobody I know voted for him.”

That election proved the Republican party can not win simply by pandering to evangelical voters while ignoring fiscal conservatives and libertarians. The voters showed that when faced with a Democrat or with a Republican who will act like a Democrat on fiscal issues, they’ll go with the real big-spender rather than the wannabe. At least voters don’t then feel that they or their representatives are hypocrites; they’re getting the government they were promised…even if it’s not the government they want.

If there is a poster boy for this problem, it’s Mike Huckabee.

Mike Huckabee is charismatic and appealing on first glance, and of course he must be in order to have been a successful pastor. He worked in radio since he was a boy and later became president of a religiously-oriented television station where he also hosted programs. Huckabee’s career has been built on being at least superficially appealing and good at offering enough sound bites to keep an audience satisfied an hour at a time.

But the master of the sound bite, a man who panders to the religious right on social issues but otherwise is the furthest thing from a fiscal or constitutional conservative among all the GOP candidates should not (and will not) become President of the United States.

In their 2006 Fiscal Policy Report Card on America’s Governors, the Cato Institute noted that Huckabee “went from being one of the best governors in America to one of the worst. He receives an F for his current term and a D for his entire tenure. The main reason for the drop was his insistence on raising taxes at almost every turn throughout his final term.”

Although Huckabee did pass tax cuts in his first term, “Nine days after being reelected in 2002, he proposed a sales tax increase to cover a budget deficit caused partly by large spending increases that he proposed and approved, including an expansion in Medicare eligibility that Huckabee made a centerpiece of his 1997 agenda. He agreed to a 3 percent income tax ‘surcharge’ and a 25-cent cigarette tax increase.”

The pro-free market Club for Growth puts it in more political terms: “Huckabee is proud of his tax hikes, his spending increases, and his regulatory expansions as governor, and he has not indicated that he would govern any differently as president. Nominating Mike Huckabee for president or vice-president would constitute an abject rejection of the free-market, limited-government, economic conservatism that has been the unifying theme of the Republican Party for decades….Overall, Huckabee's substantial tax hikes far surpassed his modest tax cuts, with the average tax burden increasing by a whopping 47% over his tenure.”

But don’t just take it from fiscal conservatives that Huckabee isn’t one. The New Hampshire chapter of the National Education Association, one of the most reliable and largest union supporters of Democrats, is set to endorse Huckabee, the first time in the organization’s long history that they will endorse a Republican. And why shouldn’t they, with Huckabee calling himself “a passionate, ardent supporter of having music and art in every school for every student at every grade level.”? Could Huckabee be any more removed from the as-yet unsuccessful goal of reducing or eliminating the role of the federal government in education as expounded by Republicans from Ronald Reagan to Bob Dole to Newt Gingrich to Ron Paul?

Someone so proud of his “achievements” shouldn’t need to lie about them. Yet he does, according to FactCheck.org: Huckabee’s claim that he asked for a tax hike in May, 2003 because of a court order to increase education spending is belied by his own speech before the Arkansas Legislature in which he called for raising taxes while saying “the business of education, we’ve decided to let that wait until the fall.” And, Huckabee’s claim that a gasoline tax hike was passed with 80% voter approval is also untrue. Huckabee approved the gas tax increase before a bond measure went to the voters. The bond measure passed, “but Huckabee actually campaigned against sending the gas tax proposal to the voters. Eventually he supported a plan under which the gas and diesel tax increases would take effect regardless of whether the bond passed.”

As if lying about his fiscal record weren’t enough, reports are now surfacing that even Huckabee’s supposed theology degree may not be true. I’m not expert enough in these matters to know whether there’s an important difference between a degree in “religion” versus “theology”; you can try to parse Huckabee’s response yourself.

The Republican Party is indeed a “big tent”. There is room for widely ranging views on a wide range of issues, from social issues to immigration to the war in Iraq. But supporting bigger government and higher taxes is not bringing a new view into the tent; it is burning down the tent, the very fabric of which is made of respect for liberty and limited government.

On election day, Huckabee will not appeal to a majority of Americans. His religious emphasis will turn off everyone except the “Christian right” (and they might not come along depending on how the recent report about his “theology” degree plays out). His big-spending ways will turn off fiscal conservatives. So he won’t capture “swing voters” and won’t get enough Republicans to win. Republicans who vote for Huckabee should simply be honest and go find a religious Democrat to vote for. (I presume there is one.) Indeed, if Democrats weren’t so anti-religion, Huckabee would be their pastor; he’s one of them in every other way.

Let's see if I can go a day without talking politics...here's some economics for you instead:

see "U.S. Current-Account Deficit Narrows to Two-Year Low" (Bloomberg News, 12/17/07)
http://www.bloomberg.com/apps/news?pid=20601109&sid=aFGRVkX98Hzw&refer=exclusive

Yesterday, the government reported that the Current Account Deficit, which is made up primarily of our balance of trade, fell to its lowest level in over two years and that "the figures so far this quarter suggest the trade balance may continue to improve. While the gap widened in October on record crude oil prices, the balance excluding oil was the smallest since 2004."

A couple important points to be made about this news:

First, although it may not always be as rapid as we'd like, markets tend to be self-correcting. In this case, a big current account deficit (along with other factors) cause the value of the dollar to weaken. As the dollar weakens, American goods and services become cheaper to foreigners (and their goods and services become more expensive to us), leading to a narrowing of the trade deficit, which in turn will lead to a stronger dollar, and so on.

Second, the trade deficit is not like the budget deficit, the latter of which represents excess government spending and therefore an increase in our debt and in the amount of tax the government will have to collect to cover their wastefulness. Instead, the trade deficit simply describes whether foreigners end up with more existing dollars or we end up with more of their currency. Whoever ends up with excess currency must then do something with it. With dollars, foreigners can buy oil or gold or invest in US financial or physical assets...or just by more of our stuff.

Quoting from the Bloomberg article:

Net exports added 1.37 percentage points to third-quarter U.S. growth, the most since 1996.

``For the first time in many years, the trade sector has been a positive contribution to the U.S. growth, as opposed to a negative contribution,'' Fed Chairman Ben S. Bernanke said in congressional testimony Nov. 8. ``I think going forward we'll see additional strength coming from foreign trade.''

The second piece of economic news is somewhat related. Again, from Bloomberg:
see "U.S. Housing Crash Deepens in 2008 After Record Drop" (Bloomberg News, 12/17/07)
http://www.bloomberg.com/apps/news?pid=20601109&sid=aFGRVkX98Hzw&refer=exclusive

Here's the beginning of that article:

For U.S. homeowners, builders, bankers and realtors, the crash of 2007 will only get worse in 2008.

Everyone from mortgage-finance company Fannie Mae to Lehman Brothers Holdings Inc. expects declines next year. Existing home sales will drop 12 percent and existing home prices will fall 4.5 percent, Washington-based Fannie Mae says. Lehman analysts estimate almost 1 million mortgage loans will default in 2008, up from about 300,000 this year.

``We're only halfway through the housing shock,'' said Ethan Harris, chief U.S. economist at New York-based Lehman, the fourth- biggest U.S. securities firm by market value. ``It's just a matter of time before the weakness spreads to the rest of the economy.''

The report notes that the credit crunch is now also effecting commercial real estate such as offices and shopping malls, so it's not only residential real estate that's having trouble.

How are these stories related?

Economists including my friend Brian Wesbury remind us that the increased GDP from higher exports will help to offset the "negative wealth effect" of declining real estate values. In other words, the weak dollar may either help us avoid a real estate-caused recession or at least allow any recession to be shorter and/or shallower than it otherwise might be.

This is not to argue that there's anything good about what's happening in real estate. Although I've predicted for several years on this blog that real estate was going to go through a protracted bear market, being right doesn't make me happy (not least because I now own a house). But despite what's going on with housing, all is not lost economically because free markets tend to be self-healing, even if the recovery process takes longer than we might wish.

For today's offering, allow me to suggest my HumanEvents.com article on the politics around President Bush's second veto of SCHIP expansion:

SCHIP Round 2, Ross Kaminsky, HumanEvents.com, 12/17/07
http://www.humanevents.com/article.php?id=23983

Thanks to The Freak for sending this along...

I just love this story:

The Pope condemns the climate change prophets of doom, UK Daily Mail, 12/13/07
http://www.dailymail.co.uk/pages/live/articles/news/worldnews.html?in_article_id=501316&in_page_id=1811&ito=1490

WorldNetDaily is reporting that Mike Huckabee's campaign is acknowledging that Huckabee does not have the degree in theology that he has claimed to have throughout the campaign:
http://worldnetdaily.com/news/article.asp?ARTICLE_ID=59222

I'm not enough of an expert on the difference between "religion" and "theology" to parse Huckabee's response:
http://firstread.msnbc.msn.com/archive/2007/12/14/518108.aspx

In response to my Saturday article wondering aloud whether Huckabee poses a real threat to Rudy, Sue Boyer, posted an interesting comment...and one which I thought the answer to would be suitable for a full posting rather than just another comment.

Here's Sue's comment:

Ross, Rudy is toast. I still think it will be Romney in the end. Huckabee is having a blip but it will fade. And the lib newspapers are starting to endorse McCain who never had a chance. To conservatives an endorsement from a lib paper is the kiss of death. Yes the economy is big but don't underestimate illegal immigration and terrorism as big vote getters as well esp. among traditional conservatives. The real fun so far has been watching Hillary implode with the rising stock of Obama. Wouldn't the GOP just love to run against B. Hussein Obama?

I disagree with one point, agree with another, half-agree and half-disagree with another, and used to agree with a third but am beginning to change my mind.

I disagree that Rudy is toast, or at least that anybody could know that now. This primary season is far too volatile, and voters far too weakly attached to the candidates they currently support to say that any of the top 5 GOP candidates are toast. Just when you think someone is toast, something happens...like Thompson's performance in the Iowa debate the other day. He still probably won't win, but you simply can't rule it out. And you certainly can't rule out the guy (Rudy) who still polls best overall nationally. That said, Sue is not the only one wondering aloud about Rudy's campaign strategy. (Click on the prior link to see Salena Zito's article on the subject.)

I agree that Huckabee will fade, and I hope both for the GOP and the country that he does. I'll probably write more about this soon.

I half-agree and half-disagree with Sue's statement about immigration and terrorism being big vote getters. The latter is clearly a huge voting issue. But I think that Republicans still overestimate the importance of immigration as a voting issue for the general population, even if it may be big among GOP primary voters. The 2006 elections were, in part, proof of that, as GOP candidates pounding the table on immigration didn't keep them for losing. It's hard for me to guess how much more GOP primary voters care about immigration than the general population, but I still believe that if it were that important, Tom Tancredo would be doing better and McCain doing even worse.

And finally, while it's been a lot of fun to watch Hillary Clinton's numbers plunge, I am beginning to question the conventional wisdom (which I have myself believed for a long time) that the GOP would much rather run against B. Hussein Obama than against Hillary.

Some of Obama's weaknesses are obvious: His lack of experience, his left-wing views (to the left of Hillary, but not quite as leftist as Edwards), his middle name, and, like it or not, his skin color. But maybe those of us who don't want any Democrat president (at least not from this group) are not focusing enough on his obvious positives: He's far more charismatic than Hillary, he's very intelligent (even if not wise), he rhetorically quick on his feet, and he represents change in a way that Clinton obviously doesn't. A lot of Americans won't want a presidential pattern of Bush, Clinton, Bush, Clinton. Finally, while I basically think celebrity endorsements are worthless, if you could imagine one that might matter, it's Oprah...including with suburban white women, a group that matters a lot in our elections.

Clinton should and will attack Obama's lack of experience, but her negatives are so high...and deservedly so because she's a tremendously unappealing person in my view. She's shrill, she's unethical (and probably a criminal), she has debate questions planted, etc. It seems clear to me that the only reason she has even the smallest chance to win is that she's married to Bill Clinton. If she did get the nomination, it's quite possible that by the election, more of the country would be moving toward wanting "change" rather than wanting Bill Clinton.

One other reason to consider preferring to run against Hillary than Obama is that Republicans hate Hillary and she's much more likely to get out the vote for Republicans than Obama would be.

So, for these reasons among others, it's no longer obvious to me that Obama would be much easier to beat than Hillary. I'm beginning to care less which one of them gets the Democratic nomination (though I think I'd still rather run against Obama...for now.) Instead, what I'd really like to see is both of them spend a huge amount of energy and money attacking each other, leaving the survivor bloodied and with fewer financial reserves than he or she would have had if the primary challenges weren't so strong.

As I mentioned in a recent posting, Huckabee and Giuliani's campaigns had a non-aggression pact regarding Iowa and I (briefly) suggested that Rudy should not get too comfortable with Huckabee as he could pose a real threat in primaries, especially in the South.

Today, Rasmussen released a new poll of Florida voters which shows Rudy having plummeted from a solid first place position to third place behind Huckabee and Romney, at 27%, 23%, and 19% respectively.

Quoting Rasmussen: "Those figures reflect a stunning change in the race since November when Rasmussen Reports polling found Giuliani on top with 27% followed by Romney at 19% and Thompson at 16%. Since then, Huckabee has gained 18 percentage points and Romney picked up four points. Giuliani is down eight, Thompson is down seven, and McCain is down four."

Of course this is only one poll, and the RealClearPolitics average for Florida still has Rudy in the lead, but this is the most recent poll and the numbers are too big to be ignored.

Rudy can't count on Romney to do all the fighting against Huckabee because Rudy MUST win Florida if he wants to keep from being a very damaged candidate. It's time for Rudy to take off the gloves and go after Huckabee, even if it helps Romney in Iowa.

And that shouldn't be very hard to do. Huckabee is, as a long-time Arkansas reporter said in an interview I heard, very appealing on first glance, and not very appealing on second glance. He may be folksy and he may appeal to some social conservatives, but his true conservative credentials are by far the worst of any of the Republican candidates. He's a big-government tax raiser.

If Romney's camp is stupid enough just to talk about immigration when challenging Huckabee, he's making a big mistake. Yes, immigration is a major issue, but its effect in the 2006 election seemed to be minimal, with several GOP incumbents who emphasized the issue losing their seats, most notably JD Hayworth of Arizona.

The GOP candidates have to remember "It's the spending, stupid", and keep attacking opponents are vulnerable on what should be the key issues for the party, fiscal responsibility, lower taxes, and limited government.

In response to yesterday's Washington Times article about Cory Voorhis, both Jan Herron (from CoryLegalDefense.com) and I wrote letters to the editor, and they printed them both.

Jan's, which focuses primarily on the problem of illegal alien criminals, is here:
http://washingtontimes.com/article/20071213/EDITORIAL/112130014/1013/EDITORIAL

And mine, which focuses on the selective prosecution angle, the lying Ritter spokesman, and Castorena, is here:
http://washingtontimes.com/apps/pbcs.dll/article?AID=/20071213/EDITORIAL/112130014/1013/EDITORIAL&template=nextpage

This letter to the editor of the Washington Post is a must read, especially the second paragraph. I wish I had a professor like Don Boudreaux when I was in college...

Dear Editor:

That herald of "heroic conservatism," Michael Gerson, champions active government with this swipe at laissez faire: "A concern for the rights of the poor and vulnerable is not simply 'theological'; it is a measure of our humanity. And skepticism in this noble cause is not sophistication; it seems more like exhaustion and cynicism" ("The Heart of Conservatism," December 12).

The great error of Mr. Gerson and other opponents of laissez faire - be they conservative or "liberal" - is to mistake government for society. No one this side of sociopathy is indifferent to the rights of the poor and vulnerable. The pressing question is which institutions will best protect those rights. Right or wrong, those of us who oppose the welfare-and-regulatory state do so not because we are unconcerned with others, but because we have reason to believe that freer markets and voluntary civil society are far more effective than is political action at promoting human prosperity and dignity.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

Here's a more-clear-than-usual article by former Fed Chairman Alan Greenspan in which he makes a few important arguments:

"...bubbles cannot be safely defused by monetary policy or other policy initiatives before the speculative fever breaks on its own."

"...the impact on demand for homes financed with ARMs was not major. Demand in those days was driven by the expectation of rising prices--the dynamic that fuels most asset-price bubbles. If low adjustable-rate financing had not been available, most of the demand would have been financed with fixed rate, long-term mortgages. In fact, home prices continued to rise for two years subsequent to the peak of ARM originations (seasonally adjusted)."

"In mid-2004, as the economy firmed, the Federal Reserve started to reverse the easy monetary policy. I had expected, as a bonus, a consequent increase in long-term interest rates, which might have helped to dampen the then mounting U.S. housing price surge. It did not happen....

In retrospect, global economic forces, which have been building for decades, appear to have gained effective control of the pricing of longer debt maturities. Simple correlations between short- and long-term interest rates in the U.S. remain significant, but have been declining for over a half-century. Asset prices more generally are gradually being decoupled from short-term interest rates. "

For the full article, see:
"The Roots of the Mortgage Crisis", Alan Greenspan, WSJ, 12/12/07
http://www.opinionjournal.com/editorial/feature.html?id=110010981

Here's a great press release against global warming alarmism from an unexpected source, New Zealand's Direct Democracy Party:

DDP states its position on Global Warming (Scoop, New Zealand, 12/12/07)
http://www.scoop.co.nz/stories/PO0712/S00135.htm

I would be tempted to say "Only in Canada", but the sad reality is that this Canadian case's outcome could happen in some of our "Blue States" or in much of Western Europe:

A man convicted of the murder of 6 women, who will be tried for the murder of 20 others, and who may have killed 50 people in total is eligible for parole in 25 years.

It makes a mockery of the word "justice" and any "justice system" that would not execute this barbarian or at least give him multiple consecutive life sentences. As Christopher would say, if this guy were in Texas "he would have had a fair trial followed by a first-rate hanging."

Canadian pig farm killer jailed (BBC News, 12/11/07)
http://news.bbc.co.uk/2/hi/americas/7139765.stm

Sorry for posting this a couple days late...

My take on Tim Russert's abusive performance interviewing Rudy Giuliani on Meet the Press on Sunday, December 9th, 2007:

http://www.humanevents.com/article.php?id=23885

Thanks to my mother for sending along this article written by a friend of hers, Farideh Goldin, and published in the Norfolk/Hampton Roads Virginia Pilot. It's an appropriate and thought-provoking piece in this time of so much discussion about the intersection of politics and religion, and of the US and Iran.

HANUKKAH IN IRAN

DURING MOST OF my adult life in Iran, I dreamt of leaving my country of birth, finding a place where the words “Jew” and “woman” were not derogatory terms.

My father, however, loved Iran. He never imagined a day that he would have to abandon the country of his ancestors. We had heated debates in Iran and later in his new home, Israel.

Last year, he passed away on the last day of Hanukkah, still dreaming of Iran, his views shared by many other Iranian Jews both in Israel and in the United States. Here are my conversations — reconstructed and imagined — with my father.

Once upon a time, my daughter, after a brief journey, you and I yearned to return to Shiraz. Through the arched gateway adorned with blue tiles, we entered our forefathers’ homeland for 2,500 years. There was a time, my daughter, that your eyes, like mine, sparked with joy to see our city of roses and nightingales, the city of poets and writers.

Once upon a time, my father, winter came, the ground froze, the trees died; icecaps dropped on your city’s mountaintops. I felt the familiar invisible yellow patch on my chest for being the daughter of my mothers’ religion.

My daughter, scant were those who scorned our beliefs. People of Iran were decent and God-fearing. There is always the good and the bad wherever you go. I saw kindness, respect; I was somebody in the land of my fathers.

Baba, didn’t you tell me of dark nights of pogroms in the Jewish ghetto of your youth? Returning from his synagogue one rainy Shabbat morning, your white-bearded father, the community rabbi, was beaten bloody for daring to walk outside the walls of the ghetto.

Those were the old days of ignorance and fanaticism, of melee and mayhem — and even in the dark days, the kindness seeped through. A Muslim mullah brought us warm blankets, hot tea, bread and grapes after a long night of bedlam in the ghetto. My daughter, don’t look at the ugliness. We were better off than the European Jewry, where the socalled civilized Germany murdered 6 million of us.

Baba, we were not allowed to become 6 million. We suffered in silence. Our history not recorded and publicized, our murdered ancestors die repeatedly in the elimination of their names, their stories and their faces. Baba, don’t help erase the past because you still yearn for your farms and orchards in Shiraz.

My orchard was paradise on Earth. I created it from dust and boulders, from a land untamed and dry. I invested all my money, my time, my sweat, my love. Such amazing endeavor! Don’t tell me about your adopted country America being the land of opportunity. I had it all in Iran.

Baba, and then the tornado of the Iranian Revolution shattered your life, your farm, your house and your respected status. Fleeing in a hurry, you left them behind. You forgot that as Jews you must not invest in property that you cannot secure in your pockets, in the hem of your daughters’ dresses. How can you long for your life in Iran?

Yes, I suffered during those years of Revolution and chaos. I suffered under a regime that tortured me and took my livelihood away; a government that reduced me to the broken man you see today. But I didn’t suffer alone. The Muslims, the Bahais, the Christians, the Zoroastrians suffered as much, if not more. I am not the only displaced and wandering Iranian.

America has its own history of bigotry and anti-Semitism. Aren’t you afraid of an uprising against the Jews? As you have allowed yourself to grow roots in your new country for just a few decades, I gave myself permission to invest in the land of my fathers for millennia.

Baba, a story of 2,500 years ago doesn’t testify to today’s history. From 100,000 Jews, only 25,000 are left in Iran today — a token kept under the thumb of a Holocaust denier with an impending atomic bomb to destroy Israel, the country that sheltered you.

Baba, I can’t imagine Iranian Jews being brave enough, like the Maccabim, to rise up against those who try to annihilate us, to assimilate us, to kill our traditions.

My daughter, Hanukkah is not our story as much as Purim is. We conquered and survived through words and not swords. In your adopted country, Hanukkah competes with Christmas, a commercial holiday. Don’t forget that you are Persian.

Baba, I remember you lighting the Hanukkah candles in the corner, where no one could see from the outside. You mumbled the prayers so that no one could hear you beyond your family.

I light my menorah by an unobstructed window. Let the candles light, growing more intense every night for eight nights, brightening my house and the faces of those walking by the window. Let the neighbors and passersby know who I am — a Jew, no longer afraid.

And for you, my father, I do add an additional prayer when I light my menorah. I pray that once again the Iranian Jews, Muslims, Christians, Bahais and Zoroastrians will have the opportunity to share your vision of a free Iran — a light unto other nations.

Farideh Goldin lives in Norfolk. She teaches English at Old Dominion University. Next year she will be teaching the works of Iranian women writers. She can be reached at her Web site, www.FaridehGoldin.com.

A conversation with my father on being a Jew today in America and, during a past lifetime, in our Mideastern homeland.