Least Surprising Headline Of The Week

What's next, "Sun Rises Today, Will Again Tomorrow Scientists Predict"?

Instant update: Will Stephen be the lone spoiler at all international meetings from now on? Will the international community care, if the U.S. changes course?

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What Obama Should Do And What He Will Be Up Against

J.K. Galbraith, writing about another crash (1987) and other era of deregulation and crazy supply-side economics, outlines what needs doing and the consequences:

The rush to increase taxes, still uncertain as to result was unquestionably unwise in the immediate aftermath of the 1987 crash. But, in the longer run, if we are to avoid what may perhaps be called the Mexicanization of the American economy, there must be strong steps away from past fiscal policy. Taxes must be raised, one hopes on those best able to pay. This will close the budget deficit, resist inflation, allow interest rates to remain low. Low interest rates, in turn, will encourage capital investment and improvement of capital plant and avoid upward pressure on the dollar. From these steps will come our best hope for narrowing the deficit in our international trade.

Such action is not pleasant -- both higher taxes and a lower dollar address adversely the standard of living. The latter can be protected to some extent by a more rational policy on military expenditure -- a sensible response in an age of nuclear overkill. But no one can suppose that from years of aberrant economic policy there is any completely agreeable escape. Those who warned against past aberration should not now be expected to come up with a perfect solution for adverse results. And those who urged the aberration will not do so. Economic, like alcoholic, excess has its inescapable aftermath. (The Great Crash 1929 from the Introduction)

The solutions to this crash are probably obvious to all. Short term stimulus, followed by prolonged long term tax hikes and government cutbacks (since it is unlikely that military spending will come down any time soon). Whether Obama has the will and the American people the stomach for this is very, very much in question. After all, Americans have for years been told that they can have government services without paying for them and become rich by trading bits of paper to each other. I don't envy Obama one little bit.

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Krugman For Secretary Of The Treasury

He would have my vote, if I had a vote and if it was an elected position.

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Oy

Shorter Friedman: Since we all know foreign policy is merely an extension of personality politics, foreigners who hated the invasion of Iraq because they hated Bush, should now embrace Iraq, since they like Obama.

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Sanity Returns?

Let's hope this is true. It would be good to think our PM is neither so reckless, nor stupid as to create a phony confrontation a month after a $300 million election. My guess is the government did some polling and found out if they did approach the coming session with that attitude and were defeated in the House, they would get slaughtered in an election. People are scared. Really scared. Especially in Ontario and Quebec. This recession is going to be bad. The very last thing people want their government to be doing is playing silly buggers with the opposition. This government and this governing party have a serious problem with the idea of governing. As Rachel Maddow observed on Colbert the other night, why hire someone who doesn't believe in the job in the first place? The Conservatives have to dispel the idea that they don't believe in government.

The people of Canada have given Harper and his crew one more chance to prove that they are not ideological ass clowns. One more chance to prove that they understand government actually has a role to play. If they do not have the ability to adjust, they will get tossed onto the sidelines like their ideological inspirations in the south.

The signal sent in the Globe article is a positive one. I just hope it sticks.

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Viva La Revolucion!

Never fear Republicans, you have your own Che Guevara and he heading to the hills to begin the fight anew. Republicans, because they are more into permanent revolution than actually governing, are brilliant at pivoting into insurgency mode, whenever voters toss them to the curb. Viva!

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From The Department Of Useless Statistics

David Brooks (although I have heard other conservatives blather on about this too as they try to discourage any change in governing philosophy) writes today: Only 17 percent of Americans trust the government to do the right thing most or all of the time, according to an October New York Times/CBS News poll. Gee, I wonder why? Maybe this number will change if they have a government, that you know, believes in government.

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