Nashville resident and noted economist Arthur Laffer comments on the risks posed by the bailout

Arthur Laffer comments on the risks posed by the bailout, observing that the current pricetag is approximately $3 trillion, or 20% of the entire U.S. economy:

It is true, as the proponents of these stimulus packages argue, that recipients of government checks will spend more than they otherwise would have spent. And, that increased spending will have a multiplier effect increasing spending even further. But this is only part of the story.

The government can only transfer resources; it can’t create resources. There is no tooth fairy. Every dollar given to someone comes from someone else. The government can’t bail some people out of trouble without putting other people into trouble, plus a hefty “toll for the troll.”

. . .

To see this point more intuitively, imagine what the “stimulus effect” would be if they borrowed the $700 billion from the same people to whom they gave the $700 billion and then promised to raise their taxes by enough in the future to pay off their bonds. Where’s the stimulus in that?

Obama coming around to Corker’s point-of-view on auto bailout?

According to Bloomberg:

Officials of the three automakers told members of Congress this week that they had studied a pre-arranged bankruptcy, championed by Republican lawmakers such as Senator Bob Corker of Tennessee, before dismissing the idea as unworkable.

However, now Obama might be interested in pre-packaged bankruptcies for the Big 3:

President-Elect Barack Obama`s transition team is exploring a swift, prepackaged bankruptcy for automakers as a possible solution to the industry’s financial crisis, according to a person familiar with the matter.

Obama’s team has already contacted at least one bankruptcy-law firm to say that Daniel Tarullo, a professor at Georgetown University’s law school who heads Obama’s economic policy working group, would call to discuss the workings of a so-called prepack, according to this person.

Can Federalism save the Republican Party – “unify” the country?

One blogger thinks so.  Given the divisions in the country – this blogger has a good point:

Our Founding Fathers understood one truth about political philosophy: To find common ground is sometimes impossible.  When disagreement between political opponents rests on fundamental ideological principles, one side must forfeit its core beliefs in the name of unity, or suffer defeat.  Consequently, to unify a young nation without engaging in an immediate civil war, the framers of the Constitution set up a system of Federalism that has since been abandoned by both political parties to America’s detriment.

Federalism is the system of dividing government and political power between the States and the Federal government.  This form of decentralization guaranteed by the 10th Amendment of the Constitution ensures that regardless of which ideology achieves power at the federal level, it would not be granted monopolistic tyranny over minority views. . . .

Since Ronald Reagan, the Republican Party has doubled down on remaking the federal government in its own image.  It went from a Party that advocated local control over education and accountability, to using Jimmy Carter’s Department of Education to create a “conservative” federal program called No Child Left Behind. . . .

The greatness of Federalism is that States can freely experiment with public policy without significant political difficulty.  Subsequently, if the ideas prevail, other states in the Union can mimic them.  If the ideas fail, individuals can “vote with their feet” and leave.  Conversely, if ideas crash at the federal level, our entire Country experiences a disaster . . .

Not only are there political differences between libertarians and social conservatives, but also there are cultural differences between different regions of the Country.

. . . San Francisco has few cultural similarities to Montgomery, Alabama.  This is not a moral judgment; it is just a reality that we need to accept.

The great irony is that if the Republican Party adopts Federalism as a major goal of its Party platform, it will appeal to people across the political spectrum, even some Democrats.  The reason is obvious: Federalism offers the individual more control over his or her life.  The only tradeoff is that one must allow someone from across the Country to have that same liberty. . . .

Lastly, it must be noted that the term, “States’ Rights” has a pejorative connotation gained from the era of Jim Crow Laws.  This may explain why Republicans recently have abandoned the policy for fear of being labeled a racist.  Nevertheless, fear that an ignorant few could engage in an ad hominem attack is no reason to avoid educating the masses of your true laudable intentions. . . .

In conclusion, the Republican Party has only one option to avoid being swept into the dustbin of history.  It must offer a solution to empower the masses to take control over their own lives.  For the same reasons that the Founding Fathers did in the past, the Republican Party must unite around Federalism.   Do not forget that unity via a decentralized government is why we are called the United States in the first place.

More than 13 million e-mail addresses; half a billion bucks raised online

This article from the Washington Post details Obama’s amazing e-campaign, described as a “multifaceted digital operation”:

• Barack Obama raised half a billion dollars online: 3 million donors made a total of 6.5 million donations online adding up to more than $500 million.  Of those 6.5 million donations, 6 million were in increments of $100 or less.  The average online donation was $80, and the average Obama donor gave more than once.
• Obama’s e-mail list contains upwards of 13 million addresses.  Over the course of the campaign, aides sent more than 7,000 different messages, many of them targeted to specific donation levels (people who gave less than $200, for example, or those who gave more than $1,000).  In total, more than 1 billion e-mails landed in inboxes.
• A million people signed up for Obama’s text-messaging program.  On Election Day, every voter who’d signed up for alerts in battleground states got at least three text messages.  Supporters on average received five to 20 text messages per month, depending on where they lived — the program was divided by states, regions, zip codes and colleges — and what kind of messages they had opted to receive.
• On MyBarackObama.com, or MyBO, Obama’s own online social network (“socnet”), 2 million profiles were created.  In addition, 200,000 offline events were planned, about 400,000 blog posts were written and more than 35,000 volunteer groups were created.  Some 3 million calls were made in the final four days of the campaign using MyBO’s virtual phone-banking platform.  On their own MyBO fundraising pages, 70,000 people raised $30 million.  The campaign even set up a grassroots finance committee that was inspired by the national finance committee’s high-dollar bundlers.  In the grassroots committee, though, supporters were trained to collect small-dollar donations from their friends, relatives and co-workers.
• Obama has 5 million supporters in other socnets.  He maintained a profile in more than 15 online communities, including BlackPlanet, a MySpace for African Americans, and Eons, a Facebook for baby boomers.  On Facebook, where about 3.2 million signed up as his supporters, a group called Students for Barack Obama was created in July 2007.  It was so effective at energizing college-age voters that senior aides made it an official part of the campaign the following spring.  And Facebook users did vote: On Facebook’s Election 2008 page, which listed an 800 number to call for voting problems, more than 5.4 million users clicked on an “I Voted” button to let their Facebook friends know that they made it to the polls.

Thanks to The Next Right for linking the story.

Rebuild the Party update

From an email sent by RebuildTheParty.com:

Watch for our new site to go up in the next couple of days.  The next version will include a full list of endorsees, self-organizing and networking features and a scorecard to highlight responses to the plan by potential candidates for RNC Chairman.  And we’ll create a space for highlighting the best solutions from our ideas site on how to modernize the way we run and win campaigns. 

Many have expressed strong interest in devoting time and resources to rebuilding the party.  We’ve heard you.  In addition to better tools for self-organizing, we’ll be rolling out more specific opportunities to channel your enthusiasm in the coming weeks.  Stay tuned!

Bailout explained

This is good.

What is an American car?

Good points by Alan Reynolds:

Before “loaning” billions more in taxpayer money to some very bad credit risks, simply because they are old American brands associated with Detroit, we might ask what distinguishes these companies from others.

Follow the link to see what, if anything, distinguishes the “Big 3″ from other auto manufacturers.

Dick Morris on bailout and G-20 meeting

Dick Morris comments on the effect of the bailout and the recent G-20 meeting that Bush hosted:

Will Obama govern from the left? He doesn’t have to. George W. Bush has done all the heavy lifting for him. It was under Bush that the government basically took over as the chief stockholder of our financial institutions and under Bush that we ceded our financial controls to the European Union. In doing so, he has done nothing to preserve what differentiates the vibrant American economy from those dying economies in Europe. Why have 80 percent of the jobs that have been created since 1980 in the industrialized world been created in the United States? How has America managed to retain its leading 24 percent share of global manufacturing even in the face of the Chinese surge? How has the U.S. GDP risen so high that it essentially equals that of the European Union, which has 50 percent more population? It has done so by an absence of stifling regulation, a liberation of capital to flow to innovative businesses, low taxes, and by a low level of unionization that has given business the flexibility to grow and prosper. Europe, stagnated by taxation and regulation, has grown by a pittance while we have roared ahead. But now Bush — not Obama — Bush has given that all up and caved in to European socialists.

The Bush legacy? European socialism. Who needs enemies with friends like Bush?

Maybe “a depression” means something different

David Brooks offers a sobering view of the future:

In this recession, maybe even more than other ones, the last ones to join the middle class will be the first ones out. And it won’t only be material deprivations that bites. It will be the loss of a social identity, the loss of social networks, the loss of the little status symbols that suggest an elevated place in the social order. These reversals are bound to produce alienation and a political response. If you want to know where the next big social movements will come from, I’d say the formerly middle class.

What do Tim Gunn and Ronald Reagan have in common?

  “Make it work.” 

At least, that’s what John J. Pitney Jr. says:

In his 1981 inaugural, Ronald Reagan famously said: “In this present crisis, government is not the solution to our problem; government is the problem.” He was right. Errors in monetary policy had led to stagflation, and federal regulations had the perverse effect of creating gasoline shortages. But many people forget what he said moments later: “[I]t’s not my intention to do away with government. It is rather to make it work-work with us, not over us; to stand by our side, not ride on our back.”

The key words are “make it work.” We conservatives believe in government that is limited and effective. Washington should not try to do everything, but when it does take on a task, it should do it well. That is why Hurricane Katrina was a political disaster for the Republican party. Rightly or wrongly, most people thought that the Bush administration had responded ineptly, and the perception of incompetence dogs the party to this day. Republican governors can help repair the damage by supplying models of skillful conservative governance. So when we’re seeking answers to our political problems, we should look not just to Washington but to Juneau, Indianapolis, and Baton Rouge.

Having organizers grows political organizations exponentially

Interesting points in a recent article that appeared on The Next Right:

Consultants, who get paid by campaigns, tend to focus on the dollars. But that’s not what we should be focusing on when we look at the Obama campaign. We should be looking at the numbers of bodies. It is the size and scope of Obama’s grassroots organization that is really the phenomonal innovation that could transform our politics. That, not the money, is what we need to figure out how to match.

. . .

In the end, the Obama campaign’s various technologies for fundraising, GOTV, and communications were side shows. They all derived from a much more fundamental innovation. Rolling Stone described the most important insight of the Obama campaign from one of their trainers: “We decided that we didn’t want to train volunteers. We want to train organizers — folks who can fend for themselves.”…

You can make the fundraisers a little more efficient. You can make the GOTV more efficient. You can have a better message and get it out better. These are linear improvements. But political organizations grow exponentially when you improve the organizers. That’s what the Obama campaign did. Everything was focused on making the organizer better.

Robin Smith’s thoughts on what the Republican Party needs to do nationally

Jonathan Martin writes in Politico that there is disagreement among Republicans about what went wrong with this election cycle and what must be done to make gains in the future.  Martin cites many of the issues that are being discussed elsewhere, but it is still a good read.  Robin Smith, Chairman of the Tennessee Republican Party, is quoted in the article:

“I think the Republican Party now is at a point in its life in maturity where we’re going to have to have regional messages,” she said, speaking in between sessions at the conference near Myrtle Beach.

. . .

The party should not compromise its core “DNA” of small government and lower taxes, Smith added, but ought to allow for some deviation where politically necessary.

“We can’t just hang our hat on one social message,” she said.

Is center v. right the wrong debate about the future of the Republican Party?

Interesting comments from Patrick Ruffini who attended the recent Republican Governors Association meeting in Miami:

. . . Tim Pawlenty put his finger on why the “traditionalists vs. modernizers” debate David Brooks is trying to foist on us is the wrong one.  Pawlenty argues we need to return to our core principles and apply them to 21st century issues.  . . .  And 21st century issues doesn’t just mean taxestaxestaxes. It means we need to be for broad, sweeping, dramatic free-market solutions to issues like health care and the environment that don’t let us get painted as any less visionary or aggressive on those issues.

. . .

For the foreseeable future, the GOP will continue to be the party of the Reaganite triumvirate of a strong national defense, free markets, and traditional values. Any effort to displace any part of the coalition will be met by fierce and automatic resistance.  . . . With the GOP in the minority, now is not a good time to be throwing parts of our coalition over the side — but to keep everybody in the fold and add new people.

American elections are by and large not referendums on ideologies. They are contests of personality, optics, and performance in office. This goes the same for when they win or we win — whether it’s 1980, 1994, or 2006/2008. The Democrats did not have to change their ideology to win; they needed to change the charisma level of their standardbearer and needed an economic crisis and a prolonged unpopular war.

Because ideology doesn’t matter in elections, and so much of politics depends on ephemeral characteristics like personality and who was in when the economy cycled south, the parties paradoxically have relatively wide latitude to govern ideologically without fear of public backlash once they get in. This is why cries of “socialism” were so ineffective during the campaign, and likewise why Bush got most of what he wanted in his early Presidency, even before 9/11. If Barack Obama is able to adopt far-left policies and make it look like he’s making the trains run on time, the country will enter a new liberal era not by virtue of public opinion, but by acquiesence to what appears to be competent governance. In 1993-94, the Clintons tried to move the country to the left and looked incompetent in the process. It was the latter more than the former that opened a door for conservatives in 1994.

There is a relationship between ideology and competence in that ideological governance makes the other side fight harder, while middle of the road policies usually stymie effective opposition (but don’t move the ball ideologically). This means that Mitch McConnell must obstruct to increase the likelihood of Obama being seen as ineffective or incompetent (independent of his ideology), but we have to lead with our positive alternatives to inoculate against the inevitable charge that the GOP is too negative.

What does this mean for the current party debate?

It means that the GOP will stick to its traditional principles, while distancing itself from examples of Bush’s botched execution. It also means that modernization will happen in other, more useful contexts  — be it in the aggressiveness with which we apply conservatism to a nontraditional issues, revamping how we use technology and modernizing our grassroots efforts, and most crucially, by fielding younger, more inspiring candidates who can transcend petty battles between the “so-cons” and the “fis-cons” by providing a better hope of winning elections and restoring both factions to power.  . . .

Casting a wide net

I’ve been out of town the past couple of days.  Sorry for not having any updates. 

I found this to be a good viewpoint on how to expand the party.  Here are a few excerpts:

Assumptions:

. . .

2. The candidates and the campaigns they run ARE the party. Run good candidates and good campaigns, and the perception of the party begins to change immediately. When considering this, style and tone appropriate to the jurisdiction are important.

. . .

4. The genius of the Obama campaign was casting the widest possible net. They gave basic, two-day organizer training to 5,000 people. Perhaps all 5,000 didn’t work out, but certainly more than a couple did. More bodies means more ground covered. In contrast, the Republican model is to [give more in-depth training to fewer people].

Actions:

1. Train casting the widest possible net.  . . .  build the talent base of organizers — people with the basic knowledge to start the phone bank, open the office, recruit the lit drop, etc.

. . .

2. Recruit casting the widest possible net. To have the best chances of electing a state senator, one should encourage candidates for mayor, first selectman, city council, county legislature, etc., all at the same time.

Ask 10 people to run, not 2, and with homegrown organizers, you don’t have to lift a finger. Some candidates will work out and some won’t, but the process will go on independently. . . .

 

How Barack Obama effectively used the Internet

Barack Obama had a tremendously effective Internet site that allowed his volunteers to connect with one another, contact voters, raise money for his campaign and share their thoughts about the campaign.  I would encourage you to watch this video because this is a very powerful tool.  The video only takes six minutes to watch.  Go to this link and scroll down to “See it in Action.”

Rebuild the Party

These folks are proposing a lot of good ideas.

The $700 billion bait-and-switch scam

People didn’t see this coming?

And, of course, GM needs some of the action, or it would be the end of the world as we know it.

Not sure what “card check” means?

Watch this 30-second video and you’ll understand.

“The GOP looking glass”

Here is an interesting article by Jonah Goldberg on the current state of the Republican Party.  First, Goldberg offers a little retrospective on Bush:

Was George W. Bush a conservative president?

For liberals, this is a settled question. Bush is not merely a conservative, he is the conservative. He is the ur-right-winger, the Platonic ideal of all that is truly Republican.

For some liberals, this is clearly just a tactical pose. Bush is unpopular, so they hope to discredit conservatism by marrying it to Bush, just as Barack Obama succeeded by painting John McCain as a Bush clone. This is the moment, as Obama might say, to permanently block the right-hand fork in the road so the country can only move leftward.

The view on the right is very different, and the debate about the Bush years will largely determine the future of the Republican Party and the conservative movement.

Bush’s brand of conservatism was always a controversial innovation on the right. Recall that in 2000 he promised to be a “different kind of Republican,” and he kept his word. His partner in passing the No Child Left Behind Act was liberal Massachusetts Sen. Ted Kennedy. Bush’s prescription drug benefit — the largest expansion of entitlements since the Great Society — was hugely controversial on the right. He signed the McCain-Feingold bill to the dismay of many Republicans who’d spent years denouncing campaign-finance “reform” as an assault on freedom of speech. The fight over his immigration plan nearly tore the conservative movement apart.

This is not to suggest that Bush was in fact a liberal president. Politics is not binary like that. There were conservative triumphs — and failures — to the Bush presidency. He appointed two solid conservatives to the Supreme Court. He tried to privatize Social Security, though that failed for sundry reasons.

His much-touted “compassionate conservatism” was rejected by many of us on the right as a slap to traditional conservatives and an intellectual betrayal of Reaganite principles. It was a rhetorical capitulation to Bill Clinton’s feel-your-pain political posturing and an embrace of the assumptions that have been the undergirding of liberalism since the New Deal. That is, the measure of one’s compassion is directly proportionate to one’s support for large and costly government programs.

And Bush admitted as much. In an interview with the Weekly Standard’s Fred Barnes, Bush explained that he rejected William F. Buckley’s brand of anti-government conservatism. Conservatives had to “lead” and to be “activist,” he said. In 2003, Bush proclaimed that when “somebody hurts” government has to “move.” This wasn’t a philosophy of government as much as gooey marketing posing as principle. Ronald Reagan would have spontaneously burst into flames if he’d uttered such sentiments.

Dissent from Bush was muted for years, in large part because of 9/11 and the Iraq war. Conservatives, right or wrong, rallied to support their president, particularly in the face of shrill partisan attacks from Democrats who seemed more interested in tearing down the commander in chief than winning a war. But the Bush chapter is closing, and the fight to write the next one has begun.

That is a pretty good summary of the Bush years.  The other thing I would add is the lack of fiscal responsibility. 

The author then turns to look to the future, although I sense a bias toward the “mostly younger, self-styled reformers” over the “Rush Limbaugh crowd”:

In one corner, there are a large number of bright, mostly younger, self-styled reformers with a diverse — and often contradictory — set of proposals to win back middle-class voters and restore the GOP’s status as “the party of ideas” (as the late Daniel Patrick Moynihan put it).

In another corner are self-proclaimed traditional conservatives and Reaganites, led most notably by Rush Limbaugh, who believe that the party desperately needs to get back to the basics: limited government, low taxes and strong defense.

What is fascinating is that both camps seem implicitly to agree that the real challenge lurks in how to account for the Bush years. For the young Turks and their older allies — my National Review colleagues Ramesh Ponnuru, Yuval Levin and David Frum, the Atlantic’s Ross Douthat and Reihan Salam, New York Times columnist David Brooks et al — the problem is that Bush botched the GOP’s shot at real reform. For the Limbaugh crowd, the issue seems to be that we’ve already tried this reform stuff — from both Bush and McCain — and look where it’s gotten us.

Neither camp has adequately explained where Bush figures in their vision for the future of the party. Is reform going to be a debugged compassionate conservatism 2.0 or a Reaganesque revival of conservative problem solving? Does back-to-basics mean breaking with the precedents of the last eight years or building on them?

The irony is that both camps agree on a lot more than they disagree. The reformers are committed to market principles and reducing the size and role of government, and so are the back-to-basics crowd. The problem is that an elephant named George in the room is blocking each side from seeing what the other is all about. But hopefully not for much longer.

Good point that “both camps agree on a lot more than they disagree.”  The conservative principles that we agree on is where our focus should be.

Camille Paglia on Palin

Camille Paglia (a liberal and certainly no Republican) had an interesting take on Sarah Palin in this article.  You have to click to the second page to see the stuff about Palin. 

Paglia first writes that the media should have done more to investigate Obama’s background (shocking revelation!), then writes:

But no, reporters have been too busy playing mini-badminton with every random spitball about Sarah Palin, who has been subjected to an atrocious and at times delusional level of defamation merely because she has the temerity to hold pro-life views.

How dare Palin not embrace abortion as the ultimate civilized ideal of modern culture? How tacky that she speaks in a vivacious regional accent indistinguishable from that of Western Canada! How risible that she graduated from the State University of Idaho and not one of those plush, pampered commodes of received opinion whose graduates, in their rush to believe the worst about her, have demonstrated that, when it comes to sifting evidence, they don’t know their asses from their elbows.

Liberal Democrats are going to wake up from their sadomasochistic, anti-Palin orgy with a very big hangover. The evil genie released during this sorry episode will not so easily go back into its bottle. A shocking level of irrational emotionalism and at times infantile rage was exposed at the heart of current Democratic ideology — contradicting Democratic core principles of compassion, tolerance and independent thought. One would have to look back to the Eisenhower 1950s for parallels to this grotesque lock-step parade of bourgeois provincialism, shallow groupthink and blind prejudice.

I like Sarah Palin, and I’ve heartily enjoyed her arrival on the national stage. As a career classroom teacher, I can see how smart she is — and quite frankly, I think the people who don’t see it are the stupid ones, wrapped in the fuzzy mummy-gauze of their own worn-out partisan dogma. So she doesn’t speak the King’s English — big whoop! There is a powerful clarity of consciousness in her eyes. She uses language with the jumps, breaks and rippling momentum of a be-bop saxophonist. I stand on what I said (as a staunch pro-choice advocate) in my last two columns — that Palin as a pro-life wife, mother and ambitious professional represents the next big shift in feminism. Pro-life women will save feminism by expanding it, particularly into the more traditional Third World.

As for the Democrats who sneered and howled that Palin was unprepared to be a vice-presidential nominee — what navel-gazing hypocrisy! What protests were raised in the party or mainstream media when John Edwards, with vastly less political experience than Palin, got John Kerry’s nod for veep four years ago? And Gov. Kathleen Sebelius of Kansas, for whom I lobbied to be Obama’s pick and who was on everyone’s short list for months, has a record indistinguishable from Palin’s. Whatever knowledge deficit Palin has about the federal bureaucracy or international affairs (outside the normal purview of governors) will hopefully be remedied during the next eight years of the Obama presidencies.

The U.S. Senate as a career option? What a claustrophobic, nitpicking comedown for an energetic Alaskan — nothing but droning committees and incestuous back-scratching. No, Sarah Palin should stick to her governorship and just hit the rubber-chicken circuit, as Richard Nixon did in his long haul back from political limbo following his California gubernatorial defeat in 1962. Step by step, the mainstream media will come around, wipe its own mud out of its eyes, and see Palin for the populist phenomenon that she is.