FRIDAY,  NOVEMBER 21,  2008

THE BAMWATCH

Posted at 10:48 p.m. ET

The president-elect clearly dodged a high-powered political bullet today by leaking the nomination of his presumed Treasury secretary, Tim Geithner.  Mr. Obama was beginning to face a firestorm of criticism that he wasn't serious enough about the economy.  That criticism should ease now.

Thus far his appointments are center-left.  That's fine, and the best we can hope for.  However, I still am uneasy with things I hear about his national-security policies, especially that he's taking advice from Brent Scowcroft, Bush 41's national security adviser.  Taking advice from Scowcroft is like taking advice from Zbig Brzezinski, Carter's national security adviser.  Brent and Zbig think alike, and often write columns together, as they did for today's Washington Post.  Their track record isn't encouraging.

But let's see, and give the president-elect a chance.  One thing that's particularly intriguing about the Hillary thing - assuming she does wind up at State - is that she and Obama have had fundamental disagreements about foreign policy.  Presumably, they've talked over exactly what Obama's plans are.  Presumably, also, he recognizes how embarrassing it would be if Clinton resigned her position in protest over policies that were too far to the left.  I say "presumably."  There are no guarantees here. 

The record shows that Hillary behaved herself when she entered the U.S. Senate in 2001.  She did not lord it over other senators, and took her place in the seniority chain.  She understands those same rules apply when she's secretary of state.  But we can only imagine what is going through her mind - the photos of her international "triumphs," and maybe a Nobel Peace Prize.  There is no doubt in my mind that she has her eye on 2016, when she'll be only 68, and a presidential candidate once more.  All this assumes, of course, that things go well, and that is a major assumption.

There might also be intermediate steps for Clinton.  She might become governor of New York.  She might have her eye on the secretary generalship of the UN.  There has been talk of a Supreme Court appointment, but I can't see it.  Her legal qualifications are thin.  She could be vice president in a second Obama term, if Biden fades away, or is made to fade away. 

Isn't it something - we're talking more about Clinton than Obama.  But that is the risk Obama is now taking.

November 21, 2008.        Permalink          

UPDATE AT 7:21 P.M. ET:  Bill Richardson, governor of New Mexico, has apparently been selected to be secretary of commerce.  He can't do much harm in that position.  He had been under consideration for State before the Hillary thing happened.  In addition, Larry Summers, who really is one of the brightest men around, is said to be in line for national economic adviser.   

COMMENT:   The question arises:  What role will there be in the new administration for Joe Biden, other than letting him take his oath?  The man has, Soviet style, essentially disappeared. 

BULLETIN AT 4:28 P.M. ET:   WASHINGTON (AP) -- President-elect Barack Obama is likely to name Tim Geithner, president of the New York Federal reserve, as Treasury Secretary in a time of intense economic turmoil as he rounds out the upper echelon of his Cabinet, an official close to the incoming chief executive said Friday.

COMMENT:  A disappointment.  The clear choice is the brilliant Larry Summers, who held the post under Clinton.  But Summers ran afoul of radical feminist groups when he was president of Harvard, and I suspect they derailed him.  These are the same groups, of course, that are silent about the oppression of Muslim women.  Mustn't upset the multiculturalists.

UPDATE AT 4:25 P.M. ET:  The Dow soared almost 500 points and did close over 8000, at 8046.

NOTE AT 3:46 P.M. ET:  One of our loyal readers, and a close adviser who has contributed much to Urgent Agenda, asks the meaning of the term "Bamwatch," which I use to headline evaluations of the Obama transition.  It comes from "Bam," which some writers use as shorthand for Obama.  Normally, presidential shorthand calls for initials - FDR, JFK.  However, initials haven't always caught on.  Rarely did I see Reagan referred to as RWR, or Clinton called WJC.  In Obama's case there is the little problem of the middle name, Hussein, which has vanished from many journalists' vocabulary.  Thus, Bam, and thus Bamwatch.

UPDATE AT 3:43 P.M. ET:  The Dow is up 361, with 17 minutes to go.  One of these irrational end-of-week rallies.  It does nothing to change the fundamentals, to the extent that economic fundamentals still drive this market.

UPDATE AT 3:22 P.M. ET:  The Dow is up 208, about 38 minutes before the close.

BULLETIN AT 3:11 P.M. ET:   From The New York Times:   Hillary Rodham Clinton has decided to give up her Senate seat and accept the position of secretary of state, making her the public face around the world for the administration of the man who beat her for the Democratic presidential nomination, two confidants said Friday.

COMMENT:  We assume The Times, or its copy editors, knows how to spell, so please notice the use of "confidants," the male spelling, rather than the feminine "confidantes."  So, presumably, it was two men who spilled the beans.  Also, the story goes on to report "additional discussion" between Obama and Clinton since their now-famous meeting in Chicago.  I'd be willing to guess that Obama had to spell out some details of his foreign policy.  She is far more hawkish than Obama has claimed to be. 

A side note:  I was struck by the term "the man who beat her" in the quote above.  In polite company we usually say, "the man who defeated her."  Hmm. 

UPDATE AT 11:03 A.M. ET:  Well, that didn't last long.  The Dow is down 33.

UPDATE AT 9:39 A.M. ET:  The Dow opened up 160.

UPDATE AT 9:21 A.M. ET:  Nov. 20 (Bloomberg) -- Fannie Mae and Freddie Mac, the mortgage-finance companies seized by the U.S. government, will suspend foreclosures and evictions over the holidays.

COMMENT:  Real troupers.  Hey, so what if we screwed up the entire economy.  Here's a Christmas break.  (Thanks to Bruce Goldman for alerting me to the misspelling of "troupers.") 

UPDATE AT 8:55 A.M. ET:  Nov. 21 (Bloomberg) -- 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.

COMMENT:  Did you ever think you'd see the headline GM BELLY UP?  It may be a wise solution, but Newt asked a few nights ago, "Who would buy a car from a bankrupt company?"  The psychological factor here could be troubling.

UPDATE AT 8:31 A.M. ET:   From Reuters:  NEW YORK, Nov 20 (Reuters) - The New York Times Co slashed its dividend by almost three-quarters and said it would cut spending and reevaluate its assets to cope with a slump in advertising revenue that is gouging U.S. newspaper publishers.

COMMENT:  Just a slump in ads?  How about the little problem of putting out a product in which people have lost confidence?  Address that and both readers and advertisers will beat a path to your door.

UPDATE AT 8:16 A.M. ET:  From the Washington Post:  Sen. Hillary Rodham Clinton is on track to be nominated for secretary of state in the Obama administration, transition aides said on Thursday night.

COMMENT:  And other sources say that she's hesitating.  We'll know right after the next commercial for Colgate toothpaste. 

THE IMPORTANCE OF FAILURE

Posted at 8:08 a.m. ET

In the midst of all the economic chaos, leave it to Victor Davis Hanson to provide some needed perspective, not about numbers, but about culture and ethics.  Here he provides some common sense about failure, and its uses, starting with what many of us were taught as children:

The common theme was that some sort of failure in life is inevitable. It is a wake-up call for reflection -- and should prompt needed change. Our character is not just built from success, but during setbacks as well.

But now Americans seem to think such folk wisdom is obsolete. First came the $700 billion bailout of the financial industry. Such a one-time federal guarantee was perhaps necessary to restore liquidity for the failed banking system, but it sent a terrible message.

And that message:

Those who caused the mess -- greedy traders, corrupt politicians, incompetent CEOs and gullible stockbrokers -- got a collective reprieve.

True.  Do we remember any of the names?  Can we place the faces?  If some of the worst culprits walked down our street, would we recognize them? 

The teetering U.S. auto industry is now next in line for a multi-billion-dollar federal bailout. But for decades, Detroit made gas-guzzling automobiles that the public believed were not as well built as the Japanese competition -- despite being made by unionized workers who were paid nearly twice as much as those somehow building better cars. Will overpaid auto executives and workers worry about the consequences of their ongoing mistakes when the government has assured them that failing is not an option?

At least we're seeing some resistance.  Many Americans aren't buying the fast hustle as quickly as some politicians are.

California is also on the edge.  They spend, and spend.

But what they see in return are bloated bureaucracies, poor schools, congested highways and dysfunctional community hospitals. With a bailout, California's governor and legislators won't worry too much that their constituents are some of the most taxed and least served of any in America.

And...

Universities raise tuition rates that exceed the rate of inflation. But in our brave, new no-failure world, why worry when more promised federal-guaranteed student loans and credits will ensure steady paying enrollment? With guaranteed federal money, why be concerned that colleges and universities are overstaffed with administrators, replete with centers and programs that have nothing to do with undergraduate education, and erecting Las Vegas-like student unions and colossal recreation centers?

Ah, a delicate nerve.  When are we finally going to look at colleges with a cold eye, and realize that they're businesses?

Americans are creating a therapeutic society in which none of us need fail. No one loses in T-ball anymore. Schools honor a dozen valedictorians. In universities, a "C" passing grade is now the understood kinder and gentler version of the old and now-rare "F."

Our culture forgot that there was once a utility in failure. Failing reminded us of what works and what doesn't -- and how we must learn to avoid the latter. Instead, in our new economic purgatory, no firm, company, state, city or individual ever quite goes to financial heaven or hell. A Bear Stearns or Chrysler neither succeeds nor fails but just sort of endlessly exists.

Good thoughts to ponder on the weekend.  Charles Kettering, of the once-successful General Motors, used to say that there's no such thing as failure.  There's only experience.  Another good thought.

November 21, 2008.      Permalink          

UPDATE AT 7:26 A.M. ET:  TOKYO (AP) -- Honda Motor Corp. said Friday it will cut production in Japan and Europe by 61,000 vehicles, as it continues to grapple with slowing global demand.  The latest cut means Japan's second-largest automaker will reduce annual production by more than 140,000 vehicles worldwide.

COMMENT:  But no cries of anguish, no demand for a bailout.  When you've done it right, you can absorb losses. 

UPDATE AT 7:12 A.M. ET:   From the Washington Times:  President-elect Barack Obama is staying out of the congressional fight over bailing out the U.S. auto industry, despite his previous statements urging help for Detroit's struggling Big Three, a leading Senate Democrat said Wednesday.

"I can tell you flat out there will be no endorsement [by Mr. Obama] prior to January 20," said Senate Banking Committee Chairman Christopher J. Dodd of Connecticut a day after his committee heard a combined appeal for billions of dollars in taxpayer help from the heads of General Motors Corp., Ford Motor Co, and Chrysler LLC.

COMMENT:  Increasingly, in TV spots and on the internet, there is a muttering of dissatisfaction with Obama, that he should be making the economy his priority and appointing a Treasury secretary to reassure the people and the markets.  Not a good show so far.

UPDATE AT 6:52 A.M. ET:  The foreign markets stabilized overnight.  That may (or may not) portend a better day on Wall Street, especially with profit takers hanging around.  Let's see.  The overall downward trend, and the psychological factors that lead to recessions, are plainly there.

THURSDAY,  NOVEMBER 20,  2008

UPDATE AT 9:25 P.M. ET:    From our own State Department:  Assistant Secretary of State for Educational and Cultural Affairs Goli Ameri and the Fulbright Association will co-host a ceremony honoring Archbishop Emeritus Desmond Tutu on Friday, November 21, 2008, at 11 a.m. in the Dean Acheson Auditorium of the U.S. Department of State. The 2008 J. William Fulbright Prize for International Understanding will be awarded to Archbishop Tutu for his work for peace in South Africa and elsewhere. The prize carries a $50,000 award provided by The Coca-Cola Foundation.

COMMENT:  What a profound farce.  Fulbright was a racist who never changed his racial views.  Tutu has, in the last twenty years, indulged the world's worst dictators.  Their names deserve to be linked together.

UPDATE AT 9:16 P.M. ET:  ABC News is reporting that President-elect Obama is listening to advice from General Brent Scowcroft, Bush 41's national security adviser.  This is not good.  Scowcroft takes a soft line toward our Mideast opponents.   His "advice" to Bush 41 never seemed to result in anything successful.  It was Scowcroft who was sent to China not long after the Tiananmen Square massacre, and acted as if it never happened.

At the same time, ABC reports that retired Marine General James Jones is emerging as Obama's pick to be national security adviser.  Jones is in the Scowcroft mold.  Both men are known to be very aloof to Israel and rather understanding of our enemies.

There are also stories floating around that John Brennan, a former CIA official, may be Obama's CIA director.  He takes a soft line on Iran, as does Vice-President-elect Joe Biden.

None of this should shock anyone.  The nation is getting what it elected.

NOTE AT 8:28 P.M. ET:  Rush, on his radio show today, suggested that the Dems are indifferent to the plunge in the markets and the nosedive in economic statistics because they actually want the situation to get worse.  The logic here is that the worse the economic condition, the more open the public will be to radical leftist "solutions." 

COMMENT:  I don't know if Rush is right on this, but the lack of urgency by the president-elect is telling.  The panel on Brit Hume's Fox News show tonight was in agreement that he should have already named a Treasury secretary to reassure the public.  The incoming party, in general, seems rather casual about what's happening.  There is clearly a tension in the country, apprehension by the business community, deep worry for investors and pension funds, and not much from our new agents of change.

UPDATE AT 8:25 P.M. ET:   PITTSBURGH (AP) -- A judge denied bail on Thursday for a woman accused of killing an FBI agent during a drug raid that led to her husband's arrest on cocaine-dealing charges.  Christina Korbe, 40, was arraigned early Thursday on a homicide charge in the shooting death of Special Agent Sam Hicks on Wednesday.

COMMENT:  An FBI agent was killed yesterday.  There was a time when this would've been a major story.  Instead, it was almost ignored.  Far more attention is given to a prison scandal in Iraq or a charge of abuse by a prisoner at Guantanamo.  I don't think this says as much about us as a nation as it does about the condition of our media. But the media has the power to change the nation, and that's what I worry about. 

NOTE AT 4:33 P.M. ET:  Just for background, here is a graph of the Dow industrial closings since early 2003.  This doesn't include today's drop of more than 430 points:

UPDATE AT 4:17 P.M. ET:  From the veddy liberal Boston Globe:  WASHINGTON - More than three decades after he first appeared before the panel as a 27-year-old Vietnam veteran-turned-antiwar protester, Senator John F. Kerry will be named chairman of the Senate Foreign Relations Committee, giving him enormous influence over President-elect Barack Obama's foreign policy, according to congressional officials.

COMMENT:  This is pure journalistic hype.  The chairman of the Senate Foreign Relations Committee has as much influence over foreign policy as the president wants him to have.  It's a safe place for Kerry.  He really can't do too much damage, and he'll feel important.  Teresa can practice her French.

UPDATE AT 4:05 P.M. ET:  Dow closed down about 432, pending final accounting, at 7565.  A couple of more days like this and we'll be in the six thousands.

UPDATE AT 3:55 P.M. ET:  Near the close the Dow is down 419, at 7577.

UPDATE AT 3:39 P.M. ET:  The Dow is down 279. 

COMMENT:  Looks like another bad day.  The idea that the president-elect was, in the midst of this financial crisis, willing to appoint his fundraising chief as secretary of commerce, an individual with no known governmental abilities, is telling us something.  We insist that we want to give Mr. Obama a chance, but increasingly his administration is shaping up to be Chicago politics on the Potomac, and little more.  And we hope we're wrong. 

UPDATE AT 1:33 P.M. ET:  From WGN, Chicago:  Chicago billionaire Penny Pritzker has told Barack Obama's team she does not want to serve as commerce secretary, a senior Obama official said.  "Penny Pritzker ultimately has decided she does not want to do the Commerce thing," the senior official said.

COMMENT:  Don't you feel deprived?  Pritzker ran Obama's fundraising operation, but her family is up to its eyeballs in subprime mortgage questions because of their inolvement in a failed bank.  Baggage issues here. 

UPDATE AT 10:31 A.M. ET:  LONDON — Oil plunged below $50 a barrel on Thursday, deepening losses over the previous four sessions as battered financial markets reflected ever lower confidence in the world economy and evidence mounted of falling fuel demand.

UPDATE AT 10:03 A.M. ET:  Dow down 164.

HOLD THAT HOLDER

Posted at 9:13 a.m. ET

National Review, not shockingly, is doing the work the mainstream media should be doing in examining Eric Holder, Obama's choice for A-G.  Holder flunks big time.  But I doubt if it will matter.

That didn’t take long.

As we observed throughout the campaign, Barack Obama gave indications that his election would mean a return to the September 10 mentality, a national-security outlook marked prominently by its lack of seriousness about the terrorist threat. In choosing Eric Holder to be his attorney general, President-Elect Obama has taken a step toward confirming those misgivings.

Trouble in River City.  Symbolically, Holder would be the first African-American to be attorney general.

Symbolism, however, cannot camouflage the fact that Holder is a conventional, check-the-boxes creature of the Left.

And the charge:

He is convinced justice in America needs to be “established” rather than enforced; he’s excited about hate crimes and enthusiastic about the constitutionally dubious Violence Against Women Act; he’s a supporter of affirmative action and a practitioner of the statistical voodoo that makes it possible to burden police departments with accusations of racial profiling and the states with charges of racially skewed death-penalty enforcement; he’s more likely to be animated by a touchy-feely Reno-esque agenda than traditional enforcement against crimes; he’s in favor of ending the detentions of enemy combatants at Guantanamo Bay and favors income redistribution to address the supposed root causes of crime.

This is not good.

In any other time, Holder would simply be an uninspired choice. But these are not ordinary times — we face a serious, persistent threat from Islamist terrorists.

And we'll be reminded of it.

In 1999, over the objections of the FBI, the Bureau of Prisons, and prosecuting attorneys, Holder supported Clinton’s commutation of the sentences of 16 FALN conspirators. These pardons — of terrorists who even Holder has conceded had not expressed any remorse — were issued in the months after al-Qaeda’s 1998 U.S. embassy bombings, when the Clinton administration was pretending to be the scourge of terrorism.

And more...

Equally noxious were the stealthy pardons of Susan Rosenberg and Linda Evans — Weather Underground terrorists associated with Obama’s friends Bill Ayers and Bernadine Dohrn — issued on the same day as the Rich pardon. Rosenberg and Evans had been serving decades-long sentences for bombings targeting American government facilities. With Holder again helping to circumvent the pardon process and to evade objections from prosecutors, the terrorists’ jail terms were commuted just weeks after the bombing of the U.S.S. Cole.

Nice, huh?  Finally...

To be blunt, Holder is a terrible selection. If there’s any Obama cabinet nomination that Republicans feel moved to oppose, this should be it.

Let's see if the party has any backbone left.  And let's see if these facts about Holder make it into any mainstream news publication or onto any network news show.

November 20, 2008.      Permalink          

PIRATES, BUT NOT OF PENZANZE

Posted at 8:10 a.m. ET

Isn't this strange?  With all the heavy problems facing humankind, whoever thought that piracy would make a comeback?  Now, all of us have dealt with ruthless, sword-swishing pirates who'll steal anything.  After all, I've worked in Hollywood.  But these boys are real pirates, off the coast of Somalia, and they're giving navies a big headaches.  There's got to be a film in this.

Now Arthur Herman, whose history of the Royal Navy is a classic, suggests what can be done about this new plague.  Mr. Obama, please read:

US Marines have been singing about their exploits on the "shores of Tripoli" ever since President Thomas Jefferson sent them to scour out the world's most dangerous pirates, the Barbary corsairs, from their bases in North Africa in 1801. Now President Barack Obama may have to give the Corps the chance to add a new line - by sending Marines to destroy the newest generation of pirates, this time on the other side of Africa.

Watch Code Pink swim out to help the pirates.

Piracy has been an index of civilization's ability to enforce law and order since ancient times. Yet the ability of our civilization to do that is now in question.

The Nov. 15 seizure of an Arabian oil tanker by armed Somali thugs off the Kenyan coast is just the latest incident.

Today oil, tomorrow Japanese TVs.

Yet the Navy finds itself helpless to stop the attacks. The taking of Sirius Star makes 95 international vessels hijacked this year, triple the number last year. Pirates now hold 17 freighters and 339 crew members hostage - and no one can do a thing about it.

But why?

With no better answer, companies quietly pay the ransoms. Meanwhile, America's NATO allies fear that, if they arrest irregular fighters like pirates, they'll be accused of violating someone's "human rights."

Are you believing that?  Read the last paragraph again.  That's European thinking.  And they look down on us.

History teaches that the only way to destroy pirates is from the land, not the sea - by wiping out their bases.

Those bases are in a nation that's been in anarchy and civil war ever since President Bill Clinton pulled US troops out of Mogadishu in 1993.

Read that one again, too.  That's what happens when you lose.  Losing is never cost-free, especially in international relations.  The surrender-in-Iraq crowd never understood that. 

The Somali government can't impose law and order. It's up to America and the international community to do the job:

* All nations will need to agree not to pay the Somali pirates any more ransoms, which has only encouraged the banditry. And they'll need to force corporations to say no, too.

* The Fifth Fleet will need reinforcements - not more ships, but a Marine Expeditionary Brigade that can wipe out the pirate bases once and for all.

Time for kinder, gentler measures may be running out.

Why is this so important?

Chaotic Somalia is ripe to become the next al Qaeda base. Until now, the country's Islamic fundamentalist militias have been hostile to the pirates. But evidence suggests that at least some ransom money has found its way into the coffers of Al Shabaab, a group on the US terrorist list...

...When the terrorists realize that they can not only enrich but also arm themselves through piracy - and hold the world ransom by threatening to blow up oil tankers in the world's strategic waterways - the seizure of Faina and Sirius Star may signal a new, horrifying chapter in the War on Terror.

And there's only one thing to do.

Get ready to add some new words to the Marine Hymn.

But it would mean Barack Obama taking action against an African nation.  Well, actually, he'd have the credibility to do it.  But will he use that credibility, will he use up those points?   Or will it take some maritime catastrophe?  We await the new administration.

November 20, 2008.      Permalink          

"THE ONE" AND THE OTHER ONE

Posted at 7:21 a.m. ET

Leave it to the Clintons to be the stars of Barack Obama's transition.  While the president elect trots out such magnetic personalities as Tom Daschle, his choice for Health and Human Services, the real story is Bill and Hill.  Does she want it?  Will she take it?  Will she be offered it?  Lie down with Clintons and you get up with a public-relations problem.

So, a few words about the position of secretary of state:  It ain't what it's cracked up to be.  Just as the Constitution is what the Supreme Court says it is, the post of secretary of state is what the president says it is.  Condi Rice clearly has the ear of President Bush, and ranges far and wide.  Colin Powell, no.  James Baker, in the administration of Bush 41, was practically an extension of the president, and foreign ministries knew it. 

Edmund Muskie, Carter's second secretary of state, is barely remembered in the role.  Richard Nixon's first was William P. Rogers, long forgotten because the effective power was kept by Henry Kissinger, Nixon's national security adviser, and, later, both national security adviser and secretary of state simultaneously. 

Dean Acheson (Truman) and John Foster Dulles (Eisenhower) are recalled as active, powerful secretaries.  But during World War II, Cordell Hull complained that Franklin D. Roosevelt gave him nothing to do.  He resigned.

So now Hillary ponders.  Presumably, she wants the job, or her husband would not be making grand pronouncements about revealing more of his finances to the Obama transition team than he's ever revealed.  But does she really want it?  She's not exactly the errand-girl type, and that's how it can wind up.  She might also look at the history:  Secretaries of state have not gone on to higher office.  Like the mayor of New York City, it's kind of been a retirement position.  Hillary is only 60.

But wait, wouldn't she be a star overseas?  Yeah, right.  How many American votes are there in Pakistan?

Secretaries of state take the rap when things go wrong, and the president takes the credit when things go right.  Dean Acheson was blamed for Korea, Kissinger for a detente policy that enraged the Republican base, Baker for being anti-Israel, Albright for doing her little dance with the dear leader of North Korea.  The one guy who came out with stature was George Marshall, but he was a five-star general.  His stature came with the package.

So we sit and wait and wonder.  And we read about Hillary rather than Barack.  I wonder how this guy will deal with the Russians.

November 20, 2008.      Permalink