Conflict & disaster Humor Poetry Politics & government

[2621] Sandy, Sandy, go away

Sandy, Sandy everywhere,
Sandy messes with your hair,
Sandy says she’s coming,
Sandy sends everyone flying.

Sandy crashes into the shore,
straight into Jersey Shore,
Sandy’s a storm that’s horrible,
crossing a show that’s terrible.

But what’s the price,
of an October Surprise,
when everybody expects,
what everybody expects?

Politics & government

[2607] Romney won because he was underestimated

Before the presidential debate began, I had expected Romney to be creamed. The Obama team was steamrolling for weeks or months now and it appeared that Romney was doing a terrible job at campaigning for the election. Yes, Obama is only maintaining a slim margin, but that margin has not been changing much. Already various commentators are scratching their head, thinking how on earth did Romney screw up his chances?

Plus, given Obama’s oratory skill, if the debate was a trap, then Romney was going straight into it.

Boy, was I wrong. I underestimated Romney and I am sure Obama did too. At the very least, the Obama team did not do enough preparation for the debate.

Quite the contrary, Romney was the debater. Almost throughout, Romney was the dominant debater that at times, it might have surprised Obama. Obama appeared stumped at times. So dominant was Romney, that the moderator of the debate was Mitt Romney and it was not Jim Lehrer.

I thought the reason Romney was so dominant was that he appeared to have changed his position, or at least his rhetoric. He sounded so reasonable that as I was watching the debate on television, I said to myself, “wait a minute. Did he say that?”

After a while, it was clear that this debate was about the middle ground. There was no Tea Party, there was no Occupy rhetoric. I thought this was yet again the affirmation of Hirschman’s Exit, Voice and Loyalty. During the primaries, one appeals to one’s base. Romney, after being accused as being too liberal, moved to the right to fight off the more conservative Republican candidates. During a national election with no conservative to fight against, he appeals to the median voter. One needs to win the primaries first, before one can win the presidential election, after all.

Romney played that card in this debate.

Obama did not see that coming and he struggled to overcome the new, extremely confident Romney. Even on the issue of healthcare which I think Obama has an edge, Romney met Obama head on without a flinch.

From the debate, which was very wonkish, I thought Obama lost it. He lost on taxes and schools. Even on financial regulation. Imagine that.

No, I do not think Romney won the debate on financial regulation just because I am a libertarian. I claim so because Romney said he wanted clearer regulation, not less regulation after Obama effectively said Romney wanted to return to old-style no regulation. Romney brought up the qualified mortgage case as an example of bad regulation and Obama had no answer for that. In fact, Obama, struggled to reply on the wider issue of too-big-too-fail. Indeed, Romney turned the Main Street-Wall Street debate, which is naturally a Democrat’s strong point, on its head that Obama lost his bearing.

And so, I thought Romney won the domestic policy debate.

There are two more debates. The next two debates will be about foreign policy and while I do think Obama will win that (Romney’s foreign policy, I think, is horrible), I am preparing myself to be surprised.

Economics Politics & government

[2587] You shall not crucify mankind upon a cross of gold

I do not take hard currency idea seriously. Hard currency is a wacky idea. I generally think supporters of hard currency, gold standard advocates being the worst, as non-serious discussants of monetary policy. Hard currency is inflexible and it will exert unnecessary pain in time of crisis. If we had a hard currency all over the world during the last financial crisis, we would have easily experienced the worst depression in modern times. Worse than the 1930s Great Depression.

It would be worse because the world’s economy was so much bigger in the 2000s than it was in the 1930s and given real prices of commodities associated with hard currency, gold and silver specifically, the supply of hard currency could not accommodate the demand for money. The world’s economy would be much smaller than it was at every single point of modern history even without any crisis.

I am a libertarian but unlike too many libertarians, I prefer fiat money to gold standard. I have rationalized my position before.

On top of that, I am a monetarist because I understand the basic operations of modern monetary policy and its implications. I accept the lesson taught by Milton Friedman and Anna Schwartz: in times of crisis, expand the money supply. Under hard currency, the expansion is almost impossible while deflation, which as damaging to general welfare as hyperinflation is, is always a real threat.

Although I am generally reluctant to admit it, I do ultimately support previous quantitative easing exercises in the United States and other similar money supply expansion in other parts of the world. The fear of expansion is always about high rate of inflation but it is quite clear for the past few years that there is a considerable unmet demand for money that money supply expansion does not create any kind of noticeable damaging inflation. Until inflation becomes a credible threat, I will not oppose money supply expansion by too much.

In other words, I think Federal Reserve chairman Ben Bernanke has done a great job. Bernanke given his scholarship is the right man for the job.

So, I take it as a demerit when Mitt Romney said he would not reappoint Bernanke to the job if he is elected as the next President of the United States. And I take it as a huge downer for the Republicans to bow to unreasonable crowd that is the Tea Party and then push for gold standard.

This may force me to reassess my bias with respect to US politics.

I have a Republican bias just because of Republicans’ economic policy has typically been closer to my preference (notwithstanding the Clinton’s years that blurred the line; I do consider Clinton as the best President in recent times). At least, the rhetoric is. And I do think the selection of Ryan Paul as exciting. This election has catapulted libertarian understanding to the national front farther than Ron Paul has ever done.

But the contemporary Republican view on monetary policy might be too much for me.

There are many great economists within the Republican camp at the moment. It is the responsibility of these economists to advise the Republicans of the folly of gold standard.

Poetry Politics & government

[2508] Democrats for Santorum!

Saint Santorum needed Michigan,
But he couldn’t get enough Republicans,
“Damn it Mitt,” said the senator,
“I’m going with the Democrat electors.”

Conflict & disaster Politics & government

[2356] A dead Osama means dead Republicans

President Obama has just announced that Osama Bin Laden is dead.  I am sure there will be a lot of discussions on the matter, of how it will affect relationship with the Muslim world, of how this will affect military operation in Pakistan and many others.

One question I want to explore is its potential effect on the 2012 Presidential election.

This is a huge achievement for the Obama administration for one reason: by choice or by accident, the Republicans made Bin Laden the center of their administration and they failed to close the issue it satisfactorily. President Bush was positioned as a war president and I remember during the 2004 election when I was in Ann Arbor, the Republicans relentlessly attacked the Democrats for being soft on War on Terror. The Republicans put themselves as the only party that could lead the US in time of war.

In the end, Bin Laden was the political object of the war, regardless of his strategic value. Yet, four years later, eight years later, he was nowhere in sight, still roaming the mountains of Afghanistan and Pakistan. Hence, the Republican administration under Bush failed politically.

Now that Bin Laden has been killed by the US military, the objective has been achieved. And was achieved by a Democrat administration.

For a party that is traditionally seen as the one with the experience and the backbone in terms of foreign policy, this cannot be good for the Republicans of 2012. Surely, among the pro-war groups that centered its motive around the need to avenge, the Democrats are the heroes, not the Republicans.

As security concerns slowly retreat into the background and merge with various political noise, so too the likelihood of us seeing a Republican President in 2012.