The Worst is Yet to Come

The Worst is Yet to Come

By: Vasko Kohlmayer

Monday, August 31, 2009

 

When there will be no one to finance the ultimate bail out.

“Today, we’re pointed in the right direction… While we’ve rescued our economy from catastrophe, we’ve also begun to build a new foundation for growth,” said President Obama recently. 

Unfortunately, the president’s declarations and all the talk about the green shoots by his acolytes in the media are merely wishful thinking. Far from rescuing it, the Bush/Obama stimulus has dealt a damaging blow to the economy, and one which will exert its harmful effects for years to come. We only need to take a quick look at the big picture to see why.

Last year the American economic system experienced major trauma as more and more banks, companies and individuals were brought to the verge of bankruptcy. In most cases their plight was caused by their inability to service their liabilities. Buoyed by the easy availability of cheap credit and loose monetary policy of preceding years, government, commercial entities as well as private persons had taken on unprecedented levels of debt. Paul Craig Roberts, formerly Assistant Secretary of the Treasury in the Reagan Administration, correctly points out that we lived in “a debt economy.” Writing in Journal Sentinel, John Torinus, a banker with experience in leveraged buyouts, described the astonishingly lax mindset that had come to dominate the whole sphere of borrowing: 

The investment banks that crashed and burned were leveraged as high as 35 to 1. Their 3% equity base disappeared in a sinkhole of excessive debt… The excessive leverage went far beyond the investment banks. Homebuyers could get insured or federally backed mortgages with 5% down or sometimes less. They were leveraged 20 to 1 or more. Credit checks were loose. 

The cheap credit – which was made possible by artificially low interest rates – brought on the borrowing frenzy to a feverish pitch. Paul Craig Roberts observes: 

The debt economy caused Americans to leverage their assets. They refinanced their homes and spent the equity. They maxed out numerous credit cards. They worked as many jobs as they could find. Debt expansion and multiple family incomes kept the economy going. 

Toward the end of 2008 the overall debt level – public, commercial and personal – in the American economy was well over $50 trillion. This was three and a half times the size of the country’s total economic output (around $14 trillion) and more than double the debt level of 2000. At over 350 percent, this made ours the most over leveraged economy in history. To put it bluntly, all of us – individuals, businesses and especially government – lived  beyond our means. The American economy was over-leveraged through and through. 

The racket held while the economy boomed. But once it seized, the over-indebtedness became unsustainable and things began falling apart. Describing this process, Nouriel Roubinini, one of America’s leading financial commentators, wrote in Forbes: 

Americans lived in a “Made-off” and Ponzi bubble economy for a decade or even longer. Madoff is the mirror of the American economy and of its over-leveraged agents: a house of cards of leverage over leverage by households, financial firms and corporations that has now collapsed in a heap. 

Painful as the impending bankruptcies tsunami would have been, it would have ultimately delivered a remedy. In order for an economic system to remain viable, excessive indebtedness must be corrected and those responsible chastised for their misjudgment. It is for this purpose that the market evolved the institution of bankruptcy. Had it been left to unfold unimpeded, the process would have reduced the overall leverage and the economy would have eventually found itself on a sound footing once again. 

The government, however, resolved not to allow the market do its work. In a misguided attempt to avert the necessary pain, it began propping up failing enterprises and individuals with more easy credit and direct cash injections. And even though it was initially advertised as a relatively short-term and targeted effort, the operation has been ongoing for nearly nine months while continually expanding in scope. 

This approach is fundamentally flawed on a number of levels. To begin with, the government’s actions interfere with the market’s corrective forces. But the most obvious problem is that the government simply does not have the money to do this. It is ironic that even before it embarked on its  “rescue” effort, the government itself was already more deeply indebted than the companies it sought to save. With some $65 trillion in total obligations, the federal government was, in fact, the most over-leveraged institution in America. 

The rescue has unsurprisingly turned out to be a singularly expensive undertaking. So much so that the government’s deficit at the end of this fiscal year will exceed the previous record by nearly a factor of four. At some 11 percent of GDP, this is also the highest peacetime deficit in American history when measured as a portion of the overall economy. 

If the government’s strategy – bailing out debt-ridden companies and individuals by enlarging its own astronomical debt – seems misguided, it is. There is an old truism that says you cannot get out of debt by running deeper into debt. And yet this is precisely what the government has been trying to do. This is why its approach will ultimately fail. 

The authors of the latest Comstock Partners special report put their finger on the crux of the matter. Countering the conventional wisdom of the spend-and-stimulate Keynesians, they write: 

We, however, don’t believe that the U.S. massive stimulus programs and money printing can solve a problem of excess debt generation… If this were the answer Argentina would be one of the most prosperous countries in the world. This excess debt actually resulted from the same money printing and easy money that we are now using to alleviate the pain. 

The bailouts reward bad management and irresponsible businesses practices and forestall the remedy the market is trying to administer. Contrary to what we have been told, all those injections of credit and capital do not contain a cure. Instead they are filled with the noxious serum of public debt whose toxic effects are slowly poisoning the whole system. The festering sores of the economic crisis have been only temporarily masked with government made bailout band aids, but those are no thicker than a dollar bill. The sickness will eventually break out again, but next time it will hit with greater intensity. 

Our over-leveraged government can give out those lavish bailouts only because it can still borrow at low interest. But bond investors have been growing increasingly vocal in expressing their doubts about the government’s ability to make good on its debts. It is only a matter of time before they start demanding higher bond yields. When that happens, borrowing will become prohibitively expensive. Saddled with an enormous debt and with no one to advance easy cash, the government will find itself in the same position as the companies it is trying to save today. When that moment finally arrives, there will be no one to finance the ultimate bail out. If you thought that letting a couple of big banks fail would have been bad, wait what happens when the federal government itself goes under. 

Make no mistake: The worst is still yet to come.

[Via http://bsimmons.wordpress.com]

Crisi Marxiane

Sulle cause della crisi, come giustamente osservato più volte nei vari interventi dei colleghi che mi hanno preceduto, a parte Rubini e/o qualche altro economista illuminato, nessun addetto ai lavori aveva previsto il crollo epocale di borsa che precede(va) la crisi economica attualmente in corso.

In effetti, volendo ragionare in termini classici ovvero assumendo che in una economia capitalista il mercato sia un meccanismo che si aggiusta da solo (e in qualche maniera ciò è pur vero, almeno finchè non si rompe del tutto) è anche vero che essa va incontro a crisi cicliche che la teoria marxista analizzava(va) forse con maggiore rigore e verosimiglianza.

Spiegandolo in maniera un po’ rozza, Marx affermava che il tarlo che erode le economie capitalistiche è il tasso decrescente del profitto, causa sistematica dell’insorgere di situazioni di sovrapproduzione combinate a mancanza di potere di acquisto, in uno scenario di capitalismo soccombente sotto il peso di un “big one” finanziario, ovvero la spallata definitiva al sistema sotto forma di collasso irreversibile dei mercati.

La crisi in corso, che fortunatamente sembra ad oggi rientrata da pericolo imminente, ha avuto le caratteristiche dell’Apocalisse economica descritta da Marx nei giorni in cui, alla fine di settembre, il capitalismo ha rischiato l’estinzione; di seguito, in estrema sintesi, un tentativo di descrivere tale successione di eventi.

Il 26 settembre 2008, malgrado la sua iniziale opposizione di principio, il Governo Bush decide di intervenire con una proposta economica, il piano Paulson, che comprende, tra l’altro, un intervento per il salvataggio delle banche in crisi attraverso l’acquisto di quelli che saranno poi chiamati in linguaggio corrente << asset tossici >>, titoli derivati di svariata natura e di difficile valutazione oltrechè, e soprattutto, ad altissimo rischio d’insolvenza.

Il 29 settembre, mentre la tempesta finanziaria imperversa, il Senato americano rigetta il piano con 228 voti contro 205 cosicchè il panico si impradonisce di Wall Street che cede 777 punti.

Lo shock di borsa crea un congelamento generale del credito che causa a sua volta una profonda crisi di liquidità di ampiezza planetaria.

L’impennata dei tassi sulle piazze orientali è brutale, la banche europee sono costrette a chiedere prestiti per 15,5 mld alla BCE, ma la crisi si amplifica il giorno 30 settembre poichè, mentre le banche detengono gelosamente la loro liquidità, gli hedge fund fanno la loro parte vendendo titoli bancari e peggiorando così la situazione che, al finale, si abbatte sui finanziamenti a breve delle imprese che precipitano nella insidiossisima trappola di crisi di tesoreria.

La valanga sembra inarrestabile, colossi del credito come AIG vengono praticamente statalizzati per evitare l’effetto domino del fallimento di Lehman brs, mentre Paulson propone un nuovo piano ovvero la creazione di un Trouble Asset Relief Program (TARP) che rifinanzierà, attraverso diverse modalità, le banche per molti miliardi di dollari. Il venerdi 3 ottobre, sebbeme titubante, il Senato vota a favore del piano, ma la situazione non sembra migliorare, soprattuto per le imprese che, prive della liquidità corrente di cassa, vedono materializzarsi lo spretto della crisi del 1929; infatti, per la prima volta da quella data, il sistema finanziario non è più sotto controllo.

Lunedì 6 Ottobre, pressata del panico mondiale dei mercati, la Camera dei Rappresentanti approva il Piano Paulson a larga maggioranza, il 7 ottobre il FMI stima le perdite planetaire a 1,4 T ( T=unità di conto uguale a 1.000 mld di dollari), l’8 ottobre G. Brown annucia il suo piano per la nazionalizzazione di molte banche della GB, il giorno 11 l’Eurogruppo, su iniziativa francese, decide di adottare il modello Inglese per il salvataggio del sistema creditizio.

Il giorno 27 Ottobre, grazie all’azione combinata delle svariate iniezioni di liquidità fornita in maniera più disparata i mercati sembrano tranquillizzarsi ma, alla elezione del Presidente Obama, i problemi sono ancora tutti sul tavolo con i CDS in particolare e gli altri asset tossici in generale ancora nelle pance delle banche.

Il neopresidente proporrà, attraverso il piano Geithner, una iniezione di 787 mld di dollari, questo per << farla finita con il circolo vizioso della crisi >>, piano che tirerà definitivamente il sistema creditizio dal pericolo di un collasso irreversabile lasciando però sul terreno 60 T di ricchezza nominale volatilizzata mentre il deficit di bilancio americano arriverà al 12% e il debito totale USA al livello di 54 T.

Marx forse direbbe che il “big one” è solamente rimandato.

[Via http://nafop.wordpress.com]

The Government Can Video

In a parody of the song, The Candy Man Can from Sammy Davis Jr., funny man Tim Hawkins has brilliantly assembled political lyrics in his latest video, The Government Can. http://www.timhawkins.net/

If YouTube gives awards like the Oscar’s or Grammys, this is sure to be nominated by members of  all political parties who are disgruntled with the current spending trends and debts. 

The National Debt Clock is ticking higher to an average of $3.89 billion per day since September 28, 2007. http://www.brillig.com/debt_clock/  and here it it broken down into categories http://www.usdebtclock.org/ including the per citizen debt of $38,000.

Congress will be forced to raise the legal limit on the nation’s debt later this year as the amount the government may borrow from the public, (that’d be us people who actually pay taxes unlike Timothy Geithner our Treasury Secretary) including foreign creditors, is limited by law to $12.1 trillion.  Today’s debt clock is $11 trillion give or take.

The Congressional Budget Office projects President Obama’s policies will require an additional $9 trillion in borrowing over the next decade.http://www.cbo.gov/ftpdocs/102xx/doc10296/06-16-AnalysisPresBudget_forWeb.pdf  has the President’s Budget Proposals for FY 2010. “ 

Under the President’s policies, the deficit in 2009 would total $1.8 trillion and equal 13.0 percent of gross domestic product (GDP), CBO estimates. The deficit in 2009 would be $157 billion higher than what is expected to occur under current law—primarily because of  additional spending for the government’s actions to stabilize financial markets and for ongoing military operations in Iraq and Afghanistan.

Oprah, a huge Obama supporter has a few ideas of her own to help reduce debt saying- “While the market plunges, free-floating anxiety is rising. If exercise and meditation aren’t your thing, here are a few other strategies you may not have considered.” http://www.oprah.com/subtopic/money/debt  Maybe someone from government should simply take a look at suggestion number 4- Stop Spending.

[Via http://ahrcanum.wordpress.com]

Barack Obama's helmetless bike ride sparks controversy

Washington, Aug 29 (ANI): US President Barack Obama has sparked a controversy after being pictured helmetless during a bike ride on Martha’s Vineyard.

The move, which took place on August 27, has been seen as a bad example by most.

“Yes, I know, President Obama is on a vacation, riding a bike, at a slow cadence, so what if he is not wearing a helmet, right?” Politico.com quoted Martha Castro, a California doctor, as having written on her website.

While Josh Loposer, wrote on Babble.com, a website for parents, “Truly despicable isn’t it? What kind of example is he setting for the nation’s youth?”

“Most bike accidents just happen. Bicycles up and turn over by themselves, and head injuries are a possible consequence of that. … It would be great if the president set an example,” David Mozer, director of the International Bicycle Fund, told the New York Daily News.

With all the attention the incident was receiving, the White House decided on issuing an explanation.

“I know that he generally does wear a helmet when he rides a bicycle. He supports the wearing of bicycle helmets,” White House spokesman Bill Burton said. (ANI)

[Via http://mindlessnews.wordpress.com]

Morning Report, Weekend Edition, August 28th: Burying the Last Lion, Intercepting North Korean Arms, the "Church of Hate," Health Care for Unions, Michelle's Hair, and Investigating the Investigators

One Christian’s perspective on the day’s news:

1.  Ted Kennedy was remembered last night, and whatever your politics it was a pleasure to hear the stories and remembrances of some of the most prominent people in the nation.  (A note for Bostonians: didn’t Mumbles Menino come across poorly, like a kid at the adult’s table?)  Today there is a funeral mass, and Kennedy will be flown down to Washington for a prayer at the capital and burial at Arlington National Cemetery.  I was never a fan of Teddy’s.  I find much more to appreciate in JFK, whose politics were quite different from what Teddy’s politics became.  But I understand why so many regard Teddy so highly, and it was nice to hear the tributes last night in particular from those who sat across the aisle from him.

Obama will deliver the eulogy.  Read an account here.  I’m tempted to wander of to Our Lady of Perpetual Help basilica if only to see the various luminaries gathered there.  Here is one picture from before the mass, which captures our past two Presidents, our current President and quite possibly our future President:

Again, may Teddy rest in peace.

2.  The UAE interdicted an arms shipment from North Korea to Iran, containing everything from missiles to what could very well be nuclear arms parts.  The UN was informed of this two weeks ago, apparently.  What has the UN done about it?  They’ve sent two letters.  Yawn.

3.  Amy Sullivan is not wrong to call this a “Church of Hate.”  A pretty damning recording from a sermon given in Phoenix the day before Barack Obama’s visit–the visit where protesters were standing around with assault rifles.  I don’t think much of this guy and his “rant” (who doesn’t seem to consider it possible that such a pastor would have opposed the Iraq or Afghan wars; he’s assuming a lot about the pastor, but 99% of what the pastor speaks about is the issue of abortion), but this video is worth watching if only to hear the sermon from Steven L. Anderson.

These are sound-bites cut out of a sermon in order to make a political argument, of course.  The other 95% of the sermon could have been saying “no one should take this into their own hands, and we should pray for the President, and I appreciate some of the things he’s done.”  Who knows?  But regardless, whatever the context, these sorts of statements are hateful and wrong.  Of course there was all kind of assassination porn directed toward George W. Bush from the Left–nothing worse than we are seeing now.  The pastor tries to defend himself here, but the sermon segments are pretty damning.  But this is unacceptable; it is vile; it is un-Christian.  And it deeply, deeply compromises our witness.

4.  We have been following events in Honduras on this blog.  Robert Micheletti, who was given power after the Supreme Court removed Manuel Zelaya and the military shipped him out of country, has offered to step down from power if Zelaya himself renounces power forever.  Zelaya would not be sent to jail for his crimes against the nation’s constitution, but would be allowed to live as an ordinary citizen.  No word yet on Zelaya’s response, but I’m not holding my breath.  I suspect he still holds Chavez-style dreams of being a “benevolent” Leftist dictator for life.

5.  Charges continue to be made (in this case by a Congresswoman from Los Angeles) that opponents of Obamacare are motivated by racism.  And yet when the press refers to the ugliness of the debate, they refer only to the protesters?  On a more substantive level, Mike Enzi, one of the Senators who was considering cooperating with Obamacare, has decided it can’t be saved.

6.  Another gift to supporters?  The health care reform bill that passed out of a House committee before the recess includes a $10B subsidy for union pension plans.  As the Detroit news says: “

One reason the public so distrusts the health care plan being considered by Congress is that so many troublesome details keep bubbling out of the massive legislation.

The latest example is the $10 billion taxpayers will be asked to shell out to prop up the United Auto Workers’ retiree health insurance program. …

In effect, it would ask every taxpayer, regardless of whether they’ll have health insurance coverage themselves after they retire — and most won’t — to chip in to maintain the UAW’s coverage, which even after the union’s givebacks is still better than what the average American worker receives.

No wonder the unions have sent out their toughs to stand against the town hall protesters.

7.  Catnip for conspiracy theorists.

8.  Apparently, Michelle Obama’s hair matters.  Time says so.

9.  Mike Huckabee claims that Ted Kennedy would have been told “to take pain pills and go home and die” instead of receiving quality end-of-life treatment under Obamacare.  Joe Klein accuses him of “bearing false witness.”  Is Huckabee trying to out-Palin Palin?  I don’t think so.  As others have shown, there is legitimate reason to be concerned that any movement toward nationalized health insurance is a movement toward rationing, and in particular rationing of those who are near death.  According to some estimates, 80% of our health care costs come in the final year of life.  If you’re looking to cut costs, and if there will be government pressure to cut costs because the government is footing the bill, it’s common sense that there will be pressure to cut end-of-life treatments.  Ezekiel Emanuel strongly advocated, as recently as February, little to no coverage for those under a few years of age and the very old.  Here is the graph in which he proposed how much money should be spent on individuals at certain ages:

As McCaughey explains:

Dr. Emanuel concedes that his plan appears to discriminate against older people, but he explains: “Unlike allocation by sex or race, allocation by age is not invidious discrimination. . . . Treating 65 year olds differently because of stereotypes or falsehoods would be ageist; treating them differently because they have already had more life-years is not.”

The youngest are also put at the back of the line: “Adolescents have received substantial education and parental care, investments that will be wasted without a complete life. Infants, by contrast, have not yet received these investments. . . . As the legal philosopher Ronald Dworkin argues, ‘It is terrible when an infant dies, but worse, most people think, when a three-year-old dies and worse still when an adolescent does,’ this argument is supported by empirical surveys.” (thelancet.com, Jan. 31, 2009).

Ezekiel Emanuel, of course, is Rahm Emanuel’s brother and a health care advisor to the President.  So Huckabee may be wrong.  But he is not simply bearing false witness.  This is a difference of opinion, a way of reading the health care proposals that Klein disagrees with.  But it calls for a reasoned and detailed response, not just name-calling.

9.  Today’s Two-Sides.  The Washington Post’s Fred Hiatt, from the Left, says that we need a Souter-O’Connor Commission to investigate CIA abuses.  The Washington Times’ Clifford May, writing from the Right, laments how we are “demonizing the defenders.”  And here is an account in the Post of how Khalid Sheikh Mohammad became an asset after waterboarding.  You decide.

[Via http://evangelicalgateway.wordpress.com]

Word War

U.S. Government is violating Privacy Act of 1974*…is this the beginning of the end of our Twittering days? Shall we be sorely afraid…? #CNN #FOX watchers ~ how long will you stand silent as Germany in Hitler days? German people were normal like us…but just went along with it…to their great shame and regret…let us learn from their mistakes…before losing our priviledged rights to speech and privacy.

Word War… “misinformation” (different opinions should never be construed as misinformation) “cyber spys” “we’re asking for your help” (since when does the government respect our intelligence?) They think they are Elitist..more Educated, more Weathy, more HobNobbing with Powerful people. My God is Greater than all of that…He has something to do with me…so I must be just as ‘relevant’ as they are!

Speech police meaning the ‘lovers of Obama’ inflicting pain on their own countrymen thru infringing their Own privacy laws…they are willing to sacrifice in turn to stoke their egobama mindset…the price will be high…spiritually, emotionally, mentally, and worse our private properties will end up being bankrupt…we will ultimately become slaves to countries that we owe money to…and the U.S. Government has no interest in turning the tide from this direction…God Save Us!

The worse of all this…for me personally, is I finally have found my voice on Twitter, on other social media networks…that for this to transpire only disrupts my joy in communicating to ya’ll…how can one go forward…in fear of ‘unknown repercussions’.

Isn’t it strange that Twitter & FaceBook had problems the same day? [August 11, 2009] At first I thought nothing of it…until yesterday (O yes, Mr. Government this ‘wee me’ can think…) that could it be..(an awful thought) that the Government had A LOT of people launch this DDOS attack…the timing of it is so odd, coincidental that one who is a responsible citizen ought to tuck it back in their mind for future reference…“don’t suspect evil until proven otherwise”….

Footnote: http://www.foxnews.com/politics/2009/08/07/white-house-collect-fishy-info-health-reform-illegal-critics-say/

[Via http://hislifeforyours.wordpress.com]

Live From Martha's Vineyard

Anybody watching the television news this past week most likely saw, other than Mad Men, President Barack Obama address the nation twice from the island of Martha’s Vineyard, where he’s been vacationing with his family.

Certainly, we can’t fault his choice of getaway: though economic times are desperate for many and President Obama was elected as the “people’s” candidate, a leader from the Midwest who would give ear to the common man, his choice of the WASP-y retreat of New England money is understandable: it’s a really, really nice place. 

In all honesty, the President’s job is arguably the hardest and most demanding in the world and where he chooses to vacation is his own business and, for the most part, beyond reproach.

What is more appropriate to critique is his conduct while there. The President is, even at rest, still the President; the office requires a level of decorum and taste at all times, no matter the occasion or location, and in both televised appearances this week President Obama fell short of the mark: first, in re-appointing Ben Bernanke as Chairman of the Federal Reserve and second, when delivering a statement about the death of Senator Ted Kennedy. In the first instance, the President appeared in a suit but no tie, while Mr. Bernanke looked like a Carnival cruise lines captain in white pants and a blazer, also sans tie. In the second, the President appeared in tan slacks and a white Oxford shirt, without tie or even a jacket.

Casual Friday (?).

While any man, President or not, is entitled to dress comfortably while on vacation, when the President addresses the country and the world on national television and speaks as the President he is not on vacation; he is on the job. The situation requires Presidential bearing and solemnity. The world is watching, and judging. A tie is hardly too much to ask, even of a man at leisure. Mr. Obama gave the impression of being more concerned with Vineyard fashion than with the responsibilities of his office.  

A modicum of respect for his position is required of the President when acting in an official way, as when speaking on television, and in both instances this week Mr. Obama fell short.

[Via http://andrew1769.wordpress.com]

Obama's Summer of Discontent

The politics of charisma is so Third World. Americans were never going to buy into it for long

By Fouad Ajami – Wall Street Journal

So we are to have a French health-care system without a French tradition of political protest. It is odd that American liberalism, in a veritable state of insurrection during the Bush presidency, now seeks political quiescence. These “townhallers” who have come forth to challenge ObamaCare have been labeled “evil-mongers” (Harry Reid), “un-American” (Nancy Pelosi), agitators and rowdies and worse.

A political class, and a media elite, that glamorized the protest against the Iraq war, that branded the Bush presidency as a reign of usurpation, now wishes to be done with the tumult of political debate. President Barack Obama himself, the community organizer par excellence, is full of lament that the “loudest voices” are running away with the national debate. Liberalism in righteous opposition, liberalism in power: The rules have changed.

It was true to script, and to necessity, that Mr. Obama would try to push through his sweeping program—the change in the health-care system, a huge budget deficit, the stimulus package, the takeover of the automotive industry—in record time. He and his handlers must have feared that the spell would soon be broken, that the coalition that carried Mr. Obama to power was destined to come apart, that a country anxious and frightened in the fall of 2008 could recover its poise and self-confidence. Historically, this republic, unlike the Old World and the command economies of the Third World, had trusted the society rather than the state. In a perilous moment, that balance had shifted, and Mr. Obama was the beneficiary of that shift.

So our new president wanted a fundamental overhaul of the health-care system—17% of our GDP—without a serious debate, and without “loud voices.” It is akin to government by emergency decrees. How dare those townhallers (the voters) heckle Arlen Specter! Americans eager to rein in this runaway populism were now guilty of lèse-majesté by talking back to the political class.

We were led to this summer of discontent by the very nature of the coalition that brought Mr. Obama, and the political class around him, to power, and by the circumstances of his victory. The man was elected amid economic distress. Faith in the country’s institutions, perhaps in the free-enterprise system itself, had given way. Mr. Obama had ridden that distress. His politics of charisma was reminiscent of the Third World. A leader steps forth, better yet someone with no discernible trail, someone hard to pin down to a specific political program, and the crowd could read into him what it wished, what it needed.

The leader would be different things to different people. The Obama coalition was the coming together of disparate groups: the white professional liberals seeking absolution for the country in the election of an African-American man, the opponents of the Iraq war who grew more strident as the project in Iraq was taking root, the African-American community that had been invested in the Clintons and then came around out of an understandable pride in one of its own.

The last segment of the electorate to flock to the Obama banners were the blue-collar workers who delivered him Ohio, Pennsylvania and Indiana. He was not their man. They fully knew that he didn’t share their culture. They were, by his portrait, clinging to their guns and religion, but the promise of economic help, and of protectionism, carried the day with them.

The Obama devotees were the victims of their own belief in political magic. The devotees could not make up their minds. In a newly minted U.S. senator from Illinois, they saw the embodiment of Abraham Lincoln, Franklin Delano Roosevelt and John F. Kennedy. Like Lincoln, Mr. Obama was tall and thin and from Illinois, and the historic campaign was launched out of Springfield. The oath of office was taken on the Lincoln Bible. Like FDR, he had a huge economic challenge, and he better get it done, repair and streamline the economy in his “first hundred days.” Like JFK, he was young and stylish, with a young family.

All this hero-worship before Mr. Obama met his first test of leadership. In reality, he was who he was, a Chicago politician who had done well by his opposition to the Iraq war. He had run a skillful campaign, and had met a Clinton machine that had run out of tricks and a McCain campaign that never understood the nature of the contest of 2008.

He was no FDR, and besides the history of the depression—the real history—bears little resemblance to the received narrative of the nation instantly rescued, in the course of 100 days or 200 days, by an interventionist state. The economic distress had been so deep and relentless that FDR began his second term, in 1937, with the economy still in the grip of recession.

Nor was JFK about style. He had known military service and combat, and familial loss; he had run in 1960 as a hawk committed to the nation’s victory in the Cold War. He and his rival, Richard Nixon, shared a fundamental outlook on American power and its burdens.

Now that realism about Mr. Obama has begun to sink in, these iconic figures of history had best be left alone. They can’t rescue the Obama presidency. Their magic can’t be his. Mr. Obama isn’t Lincoln with a BlackBerry. Those great personages are made by history, in the course of history, and not by the spinners or the smitten talking heads.

In one of the revealing moments of the presidential campaign, Mr. Obama rightly observed that the Reagan presidency was a transformational presidency in a way Clinton’s wasn’t. And by that Reagan precedent, that Reagan standard, the faults of the Obama presidency are laid bare. Ronald Reagan, it should be recalled, had been swept into office by a wave of dissatisfaction with Jimmy Carter and his failures. At the core of the Reagan mission was the recovery of the nation’s esteem and self-regard. Reagan was an optimist. He was Hollywood glamour to be sure, but he was also Peoria, Ill. His faith in the country was boundless, and when he said it was “morning in America” he meant it; he believed in America’s miracle and had seen it in his own life, in his rise from a child of the Depression to the summit of political power.

The failure of the Carter years was, in Reagan’s view, the failure of the man at the helm and the policies he had pursued at home and abroad. At no time had Ronald Reagan believed that the American covenant had failed, that America should apologize for itself in the world beyond its shores. There was no narcissism in Reagan. It was stirring that the man who headed into the sunset of his life would bid his country farewell by reminding it that its best days were yet to come.

In contrast, there is joylessness in Mr. Obama. He is a scold, the “Yes we can!” mantra is shallow, and at any rate, it is about the coming to power of a man, and a political class, invested in its own sense of smarts and wisdom, and its right to alter the social contract of the land. In this view, the country had lost its way and the new leader and the political class arrayed around him will bring it back to the right path.

Thus the moment of crisis would become an opportunity to push through a political economy of redistribution and a foreign policy of American penance. The independent voters were the first to break ranks. They hadn’t underwritten this fundamental change in the American polity when they cast their votes for Mr. Obama.

American democracy has never been democracy by plebiscite, a process by which a leader is anointed, then the populace steps out of the way, and the anointed one puts his political program in place. In the American tradition, the “mandate of heaven” is gained and lost every day and people talk back to their leaders. They are not held in thrall by them. The leaders are not infallible or a breed apart. That way is the Third World way, the way it plays out in Arab and Latin American politics.

Those protesters in those town-hall meetings have served notice that Mr. Obama’s charismatic moment has passed. Once again, the belief in that American exception that set this nation apart from other lands is re-emerging. Health care is the tip of the iceberg. Beneath it is an unease with the way the verdict of the 2008 election was read by those who prevailed. It shall be seen whether the man swept into office in the moment of national panic will adjust to the nation’s recovery of its self-confidence.

Mr. Ajami teaches at the School of Advanced International Studies, The Johns Hopkins University. He is also an adjunct fellow at Stanford University’s Hoover Institution.

[Via http://forevercool1.wordpress.com]

n Things That Are Missing from Obama's Health Care Reform Debate

NaturalNews) You can’t fix one broken system by replacing it with another broken system. Sure, the current health care system of “that’s a pre-existing condition” insurance companies, employer-funded health insurance and miserable Medicaid is a public health disaster, but if we’re going to fix the system, we have to come up with something that actually addresses the root cause of disease in America.

The current health care reform debate in Washington is really just a distraction — a ploy to keep everyone focused on all the wrong topics while quietly refusing to talk about the big issues that threaten the health of an entire nation.

Here are the top 10 things missing from Obama’s health care reform plan (and often absent from the debate):

#1) Ending the FDA’s suppression of natural cures and safe, effective nutritional supplements.

#2) Initiating a real investment in public education to teach people about how to prevent disease with nutrition.

#3) Ending Big Pharma’s monopoly on drug prices and drug patents (not to mention patents on human genes and animals).

#4) Restoring the ability for local doctors to practice local medicine without being controlled from bureaucrats in Washington.

#5) Cracking down on junk food advertising, soda advertising and pharmaceutical ads that convince people to purchase products that will only harm them.

#6) Banning dangerous chemical ingredients that cause diseases in the first place (aspartame, MSG, sodium nitrite, etc.)

#7) A real effort to improve school lunches and serve food that’s nutritious instead of food that’s cheap and convenient.

#8) Ending bizarre food subsidies on crops like corn that end up making high-fructose corn syrup the cheapest sweetener for manufacturers to use.

#9) Affirming health freedom for parents who wish to opt out of the current system of forced vaccinations and gunpoint-enforced chemotherapy.

#10) Requiring honest food labeling where irradiated and GMO foods are clearly labeled as such.

The Health Revolution Petition is more relevant now than ever…

In fact, the current health care reform debate is missing a long list of items that are essential to a genuine improvement in the health outcome of the American people.

With the help of several health freedom pioneers (and attorneys), I put together the Health Revolution Petition (http://www.HealthRevolutionPetition.org) which offers an affordable, freedom-oriented approach to real health care reform.

Here’s the full text of the petition:

We, the People of these United States of America, hereby call for revolutionary changes in our health care system that encourage health and prosperity instead of disease and corporate profit.

Specifically, we call for:

1. Federal government encouragement and reward for the People taking personal responsibility for their own health

- A full federal income tax deduction, with no minimum, for the purchase of any product, service, or device that is intended for use in the improvement of health. This includes, but is not limited to, dietary and herbal supplements, gym memberships, health coaching services, exercise equipment, Complementary and Alternative Medicine (CAM) therapies or any other health-enhancing products and services.

- The immediate creation of an investigatory panel, comprised of leaders from both conventional and naturopathic backgrounds, that would investigate the “Citizens In Charge” debit card health care system described at www.HealthRevolutionPetition.org/Ci…

* The “Citizens In Charge” health care system is a “socialized-free-market” system of health care that eliminates all health insurance and puts health care decisions back into the hands of the People, allowing them to spend their government-provided health care funds on any health-related products or services they choose (conventional, alternative, licensed or unlicensed).

* The investigatory panel shall report on the economic viability (and potential savings) of the program, as well as the likely improvements in health care outcomes. This report shall be made publicly available on the internet for all citizens to read and discuss.

2. Restore Health Freedom to All Americans and Legalize Healing

- Allow all practitioners of the healing arts, licensed or otherwise, the freedom to practice healing arts with the consent of patients. End all government persecution of alternative and complementary care practitioners and clinics.

- End FDA oppression of free speech about health products and therapies.

- Protect access to dietary supplements, colloidal silver, medicinal herbs and anti-cancer products.

- End FTC and FDA assaults on the Free Speech rights of natural health companies who accurately describe the health benefits of their products.

- Affirm the rights of American moms and dads to choose to avoid mandatory vaccinations of their children.

- End federal assaults (DEA) on the possession or sale of medicinal plants that have been medically recognized and legalized by States such as California.

- Legalize Healing: End state monopoly medical licensing laws that grant conventional medical authorities absolute power to decide who can or cannot practice medicine.

3. End FDA Tyranny, Censorship and Corruption

- End the FDA’s definition of a “drug” and strip it of authority to censor truthful health claims about dietary supplements.

- End revolving door employment between the FDA and Big Pharma; fire current FDA employees and advisors with past financial ties to Big Pharma.

- Require full disclosures of financial conflicts of interest of FDA managers, scientists and decision panel members.

- End the FDA’s Big Pharma-initiated attack on compounding pharmacies and bioidentical hormone therapy.

- Investigate the FDA’s collusion with pharmaceutical companies in hiding clinical trial data from the American public.

4. Protect the Food Supply

- Ban GMOs in the U.S. food supply.

- Ban harmful food additives: MSG, aspartame and sodium nitrite.

- Require honest labeling of irradiated foods.

- Require country-of-origin labeling for all foods sold in the U.S.

- Ban the importation of foods using pesticides outlawed in the U.S.

- Save California’s almond growers and end the fumigation of raw almonds.

- Require honest investigation into mad cow disease and the questionable practices of factory animal farms.

- Only permit “harmonization” of our healthcare and food laws with other nations if all the freedoms and rights mentioned in this petition are respected and guaranteed both domestically and in the harmonizing nation.

5. Restore Honest Science to Medicine

- Require the open, timely publication of all medical studies.

- Require open disclosure of all ties between study authors, researchers and for-profit entities.

- Require clinical trial results to report ABSOLUTE numbers, not just relative numbers.

- Require long-term testing of drugs (at least 12 months) before approval in order to determine real-world side effects.

- Require safety testing of multiple drug combinations that are commonly prescribed to real patients.

- End disease mongering and the psychiatric medication of infants and toddlers. Outlaw the drugging of young children with mind-altering chemicals such as ADHD drugs.

6. End Era of Big Pharma Domination Over Health Care

- End all drug-company-funded “benefits” to doctors, including vacation-style CME events, speaking fees, consulting fees and author fees.

- Investigate and prosecute drug company executives for intentionally hiding negative drug trial data and misleading the public about the safety of their products.

- Get Big Pharma out of medical schools.

- Guarantee the right of consumers to sue drug companies and medical device manufacturers for damages caused by unsafe products.

- Restore power to the FTC to regulate commercial drug advertising practices.

- Modify the Food, Drug and Cosmetic Act to double product liability and personal injury awards involving any pharmaceuticals that are advertised in a Direct-To-Consumer (DTC) manner.

- Enact legislation that would impose substantial criminal penalties for executives of drug companies that advertise drugs for which serious adverse events were known by the company at the time the drug was submitted to the FDA for approval.

- Regulate direct-to-consumer (DTC) advertising of prescription medications by removing its jurisdiction from the FDA and shifting it to the FTC, which is normally the agency that exercises jurisdiction over commercial advertising. Additionally:

* Require such ads to prominently and conspicuously display, for a period of no less than five seconds, a toll-free phone number that drug consumers may use to report drug side effects.

Thursday, August 20, 2009 by: Mike Adams, the Health Ranger, NaturalNews Editor

* Disallow the practice of using celebrity spokespersons for the promotion of any drug.

* Disallow ads that exaggerate claims of drug benefits or that do not accurately reflect the scientific findings of clinical trials.

* Require all statistical claims of drug benefits to be stated in absolute numbers, not relative numbers.

* Require drug side effects reports gathered through the toll-free phone number to be reported on a timely basis to the FDA.

* Require the FTC to disallow pharmaceutical “lifestyle advertising” that suggests taking a drug will dramatically transform the lifestyle of the patient. Lifestyle advertising sends a dangerous message that the “before” person (depressed, miserable, unhealthy-looking) will be magically changed into the “after” person (healthy, vibrant, happy, energetic and sexy) by taking the drug.

7. Protect Children From Products That Compromise Their Health

- Restrict commercial advertising of junk foods, sodas and caffeine energy drinks to programming hours not commonly viewed by children.

- Eliminate junk food and soda vending machines from all schools and public buildings.

- Get processed foods out of the school lunch program and encourage the use of fresh, unprocessed foods.

- End mandatory vaccination requirements (as per section 2, above), restoring this decision to parents.

8. Ban Man-Made, Non-Natural Cancer-Causing Chemicals in Cosmetics and Personal Care Products

- Ban man-made, non-natural chemicals in cosmetics that have not been proven safe.

- Require government-funded testing of commonly used man-made, non-natural chemicals to determine their safety.

- Require honest labeling of cosmetics and personal care products with appropriate cancer warnings.

- Recognize that the skin absorbs chemicals, and chemicals used on the skin can enter the bloodstream.

9. Invest in Disease Prevention

- Encourage and permit tax deductions for routine testing of vitamin D as part of routine patient exams.

- Encourage vitamin D supplementation and sensible sunlight exposure to correct deficiencies.

- Teach the population about nutrition, vitamin D, medicinal foods and disease prevention by using Public Service Announcements.

10. Protect the Environment from Drug and Chemical Companies

- Require the EPA to investigate the environmental impact of pharmaceuticals in the water supply.

- End the chemical fluoridation of public water supplies.

- Require hospitals, pharmacies and nursing homes to dispose of expired pharmaceuticals in an environmentally-conscious away that avoids more drugs being flushed down the drain and passing intact through waste water treatment facilities and then into our bodies when we consume tap water.

(Note: The actual wording of this petition may change slightly over time for purposes of clarity and completeness. Any changes will be minor and shall honor the spirit and substance of the petition text you are reading now.)

You can sign the petition yourself at: http://www.HealthRevolutionPetition.org

[Via http://yourbeautybynature.wordpress.com]

Prominent Socialist Dies

The father of Kopechne-care and the premier socialist of the Democratic party has finally succumbed after efforts by Obama, Pelosi, Reid failed.

Even after operations that would not be available to mere members of the general population, there was nothing that could save the man from the poisonous thinking that created the massive damage to his brain.

Edward Kennedy is gone.

May he rest and leave the rest alone!

[Via http://nakedstranger.wordpress.com]