Newsmakers 1972

Fox News Sunday opened today with the question "Are we saving the economy or heading toward socialism," (By the way, we're not.) featuring such pearls as Richard Shelby blaming the Obama Administration for legislation passed in the fall of 2008, during, um, the Bush Administration. But I was more interested in one member of the panel, Fred Malek, listed as the head of "Thayer Capital Partners." I knew I'd heard that name before, and David Corn jogged my memory.

It's one of the more gothic stories about Nixon related in Bob Woodward and Carl Bernstein's The Final Days. As they tell it, late in 1971--the same year, coincidentally, that the Washington Senators moved to Texas and changed their name to the Rangers--Nixon summoned the White House personnel chief, Fred Malek, to his office to discuss a "Jewish cabal" in the Bureau of Labor Statistics. The "cabal," Nixon said, was tilting economic figures to make his Administration look bad. How many Jews were there in the bureau? he wanted to know. Malek reported back on the number, and told the President that the bureau's methods of weighing statistics were normal procedure that had been in use for years.

In 1988, when George Bush pere installed Malek as deputy chairman for the Republican National Committee, Woodward dusted off his notes and, with the Washington Post's Walter Pincus, further revealed that two months after Malek filed a memo on the matter--he'd counted 13 Jews, though his methodology was shaky--a couple of them were demoted. (Malek denied any role and said Nixon's notions of a "Jewish cabal" were "ridiculous" and "nonsense.") The 1988 story raised a predictable ruckus, and Malek beat a hasty retreat from the RNC. As exiles go, Malek's was pretty painless. He still got to run the 1988 Republican Convention (and in 1992 he would be Bush pere's campaign manager). He joined George W. Bush's syndicate to purchase the Rangers, he went on the board of the American-Israel Friendship Society, he took over Northwest Airlines, and he started an investment firm, Thayer Capital Partners.

"Nixon's Jew counter" for some reason never came up on Malek's chyron today.

Malek's just one of those upwards-falling Republicans in Washington. Actually I found the Corn piece because he was discussing Malek's hiring as finance co-chair for the McCain campaign. The DC establishment finds keeping one of these guys going through the revolving doors of power perfectly normal.

Victory, Comrades!

So the American automakers are slowly moving toward their final positions. Chrysler put together a deal with the UAW to save them $200 million a year, and similar deals will probably be applied to Ford and GM. Obviously, Chrysler's deal with Fiat must still be consummated. As for GM, looks like we're all going to own it, and I trust this means we all get a discount.

The U.S. Treasury would own at least a 50 percent stake in General Motors under a plan the company released today to avoid bankruptcy.

The strategy would essentially formalize the government's control over one of the icons of corporate America.

"I'm a believer in dealing in reality," GM chief executive Fritz Henderson said in announcing the new plan. "We've gotten great support from the Treasury. It has viewed this matter from day one as a kind of private equity investment. It has pushed us in a lot of ways."

The announcement came as the company said it would further shrink the number of workers, dealers and types of cars in an attempt to prepare it for a United States shrunken by the recession.

Henderson said GM will eliminate 21,000 jobs by next year and phase out its Pontiac line as part of a last-ditch restructuring effort to keep the company afloat and win additional government aid.

Now this would be some ACTUAL socialism in the traditional sense. I understand the concept of trying to save all these manufacturing jobs, but I agree that a state-owned GM, at a time when the Administration is seeking policies that move away from large auto manufacturers with the product profile of a GM, could be a problem. What I've often little understood is why the government couldn't offer contracts to companies like GM to retool their factories to make high-speed rail cars and wind turbines and other physical parts of the green economy. Maybe this could be a step toward it.

I See Socialist People

Spencer Bachus (R-AL) gets in touch with his inner Joe McCarthy and outs the "17 known Socialists" in Congress.

From The Hill's Briefing Room:

Rep. Spencer Bachus (R-Ala.) puts the number of socialists in the House at 17.

"Some of the men and women I work with in Congress are socialists," Bachus told local government leaders on Thursday, according to the Birmingham News.

Bachus gave the specific number of House socialists when pressed later by a reporter.

Actually, there is one avowed socialist, his name is Sen. Bernie Sanders and he has been elected multiple times by the state of Vermont. Unfortunately for Bachus, however, this talk of "socialism" has less bite than it used to.

Only 53% of American adults believe capitalism is better than socialism.

The latest Rasmussen Reports national telephone survey found that 20% disagree and say socialism is better. Twenty-seven percent (27%) are not sure which is better.

Adults under 30 are essentially evenly divided: 37% prefer capitalism, 33% socialism, and 30% are undecided. Thirty-somethings are a bit more supportive of the free-enterprise approach with 49% for capitalism and 26% for socialism. Adults over 40 strongly favor capitalism, and just 13% of those older Americans believe socialism is better.

Many have remarked on this, but it's worth repeating - the conservative idiots outsmarted themselves. They demonized Barack Obama as a socialist for wanting to raise the top-end marginal tax rate by three points, and invest in universal health care and education and green energy, and all they did was to MAKE SOCIALISM MORE POPULAR, particularly among young people who have no memory of the Berlin Wall falling or the Cold War generally. They've equated socialism with Obama's moderate technocratic agenda, which is disarming that epithet almost as much as they've disarmed "liberal" through constant use. This is all backfiring because the nation has seen the opposite of the Obama agenda in action, and it broke the world.

"Is There Anything Wrong With Saying Yes?"

New York Times reporters had a conversation with Barack Obama on his plane, where they actually asked him if he were a socialist. Obama answered no, explained the thought process behind his budget, and later, after pondering it, actually called the reporters back and said, "It was hard for me to believe that you were entirely serious about that socialist question."

As a statement of empirical reality, this is true. As Daniel Gross pretty expertly explained, the Bush tax cuts that Obama is allowing to expire would result in about 3-4 percentage-point increases in the two top marginal tax rates, which is about $4 a day for someone making $300,000 a year. And despite the media insanity around the issue, the other 98% that doesn't make over $250,000 would see a tax cut, making it hard to understand how you can call this an overall increase. People in that top 2% can whine about how they are being persecuted for their genius and talk about going Galt all they want - and I hope they do instead of just talking about it, we need elites that don't have a track record of breaking the global economy - but the kind of "burden" placed on the wealthy, who have it better in America than any other country on Earth, isn't even the burden their patron saint placed upon them in the 1980s, which they also whined about incessantly.

According to a recent Treasury Department study, Ronald Reagan proposed the largest peacetime tax increase in American history as part of a budget deal to get the federal deficit under control. The Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982 was signed into law on Sept. 3, and most of its provisions took effect on Jan. 1, 1983.

During debate on TEFRA, many conservatives predicted economic disaster. They argued that raising taxes in the midst of a severe recession was exactly the wrong thing to do. "Every school child knows you don't raise taxes in a recession unless you want to make it worse," The Wall Street Journal's editorial page warned. Said Rep. Newt Gingrich, "I think it will make the economy sicker." The Chamber of Commerce of the U.S. said it had "no doubt that it will curb the economic recovery everyone wants."

Looking at the data, however, it is very hard to see any evidence that TEFRA had a negative effect on growth. Indeed, one could easily make a case that its enactment stimulated growth. As one can see, the economy's growth rates after TEFRA took effect were among the fastest in history.

I know that Paul Volcker's monetary policy at the Fed, a luxury we pretty much don't have right now, had a lot more to do with this, but the point is that the same defenders of the rich and powerful made the same statements about taxes then that they are making now.

But beyond the debates over opinions which are obviously ridiculous, there's a larger point that was touched upon in the follow-up question about socialism by the Times.

Q. Is there anything wrong with saying yes?

Only in a country where the balance of acceptable discourse has been so tainted and distorted that reasonable social democratic policies are completely forbidden from the conversation. And so you have Obama's advisers running to David Brooks to prove that they aren't crazy socialist radicals, but pragmatists. Which makes a certain political sense, but isn't actually true. In fact, the debate over the stimulus package was quite instructive in this regard. Obama released an initial bill that was too small for the task, perhaps assuming that the package would get bigger, as most spending bills do, as it made its way through Congress. Therefore they would not be saddled with the impression that they were expanding government as much as Congressional Democrats would. That's not what happened, and as a result, the stimulus is looking too small for the task.

Analysts increasingly view the administration's actions so far as insufficient given the scope of the problem. The stimulus package was designed to "save or create" 3.5 million jobs, according to the administration. But the nation has already lost 4.4 million jobs since the start of the recession. Many banks and other financial institutions, whose health is critical to the economy, are teetering, and the Treasury Department has yet to finalize the details of its plans to remove from their balance sheets the toxic assets dragging them down.

"It's premature to say we need another stimulus, but the economy is performing much worse than when [the law] was signed, and the odds are increasing that we'll need a bigger policy response," said Mark Zandi of Moody's Economy.com, who has advised Democratic lawmakers. "What we've learned is policy has been a step behind this whole downturn. It's important to get a step ahead."

It was well-known among economists that the size of the stimulus may have been too small, but that perspective was kept off the news. It was surely known to the Administration, however, which preferred a more cautious route.

The subsequent release of the budget, along with moving forward on long-sought initiatives on health care and energy, does seem bolder, and there are signs that Obama is learning from what may have been an initial negotiating mistake. But even this
"boldness" is being carried out along narrow technocratic liberal lines that becomes very clear from a look at the past:

Barack Obama's bold, ambitious budget plan proves that he is the true heir of Franklin Roosevelt and the New Deal. Consider Obama's Rooseveltian energy plan. In 1939, President Roosevelt decided to mobilize Americans to create a new source of energy: atomic power. Although he was urged to focus on government-funded R&D, FDR chose a different route. He wisely encouraged private capital to invest in atomic energy research by a variety of tax incentives. To make atomic power investment more palatable to private capital, FDR boldly chose to make all other forms of energy in the U.S. uneconomical, by slapping high taxes on kerosene and coal. With the money from the new federal Kerosene Cap and Trade system, President Roosevelt and Congress funded a small-scale federal research program, in the hope of attracting much greater private investment ...

Wait. What's that you say? FDR didn't do that? He poured federal money into the all-public Manhattan Project and created the first atomic bomb in a couple of years? He didn't tax kerosene to make it uneconomical and to encourage private investment in atomic power? [...]

All right, then, forget FDR. He was a socialist, anyway. Let Dwight Eisenhower serve as a model for the Obama administration. President Eisenhower authorized the biggest infrastructure program in American history, when he signed the National Interstate and Defense Highways Act of 1956. The interstate highway act created an elaborate system of private tax incentives and public-private partnerships (PPPs) to encourage private corporations to build national highways. To begin with, all U.S. highways were leased to domestic and foreign corporations for a period of decades. Second, all U.S. highways were set up with toll booths, so that American drivers would be forced to repay the corporate owners of the national highways every few dozen miles. Finally, a system of high-speed lanes with higher tolls was created, so that the rich could whiz down the road while middle-class and poor Americans were stuck in traffic jams ...

All right, what now, wise guy? So that's wrong, too? Eisenhower's national highway system wasn't based on tolls, leases to foreign companies, income-based pricing, and tax credits for private corporations? It used gasoline taxes to fund free public highways?

Free highways without toll booths, owned by the public, paid for out of taxes? My God. So the John Birch Society was right after all. Dwight Eisenhower was as much of a socialist as Franklin Delano Roosevelt!

The point here is that conservatives have so demonized the concept of the public commons, particularly inside the Beltway, that what is now considered a bold and socialistic policy shift - raising the top marginal tax rates 3-4%, investing in infrastructure with a mix of public and private money, using an individual mandate to keep insurance companies in the health care game, cap and trade - is actually a pre-compromised, market-friendly, neoliberal jumble that fits squarely in the center of the ideological divide. And this is essentially why the Army of Galts screams about socialism, to force the debate further to the right from the center where it is now situated.

I'm not totally blaming Obama for this. As a pragmatist, he is more interested in what is politically possible, and 50 years of conservative demonization has battered the ability to make anything that's not "market-friendly." In addition, members of his own party are even more cautious than he is and thus even more unwilling to do anything truly paradigm-shifting. But we have to understand the historical reality.

But a lot has changed since Wall Street imploded last fall. The great investment banks are gone, the U.S. has nationalized much of the financial system, and appears to be on the way to effectively nationalizing the automobile and housing sectors as well. In this environment, we need to consider some heresies, like the idea that the best way to provide a public good is not necessarily to pour subsidies on middlemen, and then bail them out with more subsidies when they fail at their public function.

The fundamental barrier today is the way that the issues are framed, by Democrats and Republicans alike. Thus the problem is defined not as making credit available for individuals and businesses, but as saving the banks and the shadow banking system. The goal is not to provide healthcare to all citizens, but to enable all citizens to purchase private health insurance. The objective is not to ensure universal access to higher education; it is to insure universal access to colleges and universities. In these and other cases, the means is confused with the end. The ultimate goal -- providing credit, healthcare or education -- is identified with the interests of non-governmental for-profit or nonprofit providers of that service. If these private institutions fail to provide the public service in a low-cost, effective and equitable way, then they must be subsidized even more. The idea of achieving the same public goals through simpler, more direct and efficient means that would cut out the middleman appears to be heresy to the Obama administration.

By the way, this is a centrist, Michael Lind, writing this. But one who is mindful of the past.

I grow fairly tired of the defense that "the President isn't a socialist; he isn't even doing anything that radical" used as a defense, when we're in a position with unemployment and the overall economic meltdown where we actually, um, NEED something radical done. And I think the country is prepared for that more than Beltway insiders think. So while I agree with the empirical assessment that Obama's positions are squarely in the center, and that the cult of Galtism is absurd, I don't believe that Obama's team is made up of pragmatists. Because pragmatists would look at reality and do exactly what's necessary, regardless of ideological concerns.

Non-Scary Cramer

Jim Cramer, in line to be Robert Gibbs' latest punching bag, is dutifully fulfilling his role as Wall Street's chief media embed by calling Barack Obama a "Bolshevik" who is "taking cues from Lenin". Earlier he called Obama's agenda "the most, greatest wealth destructive I've seen by a president."

John Cole has the exact right response.



"Bear Stearns is fine!!!!"

Don't be silly, indeed, Jim. Does CNBC have any non-shills around? I know, stupid question, simple answer, etc.

I Have A List Of 350 Card-Carrying Think Tank Employees!

James Inhofe does his best Joe McCarthy impression.

I have other problems with Carol Browner. There’s another organization that a lot of people don’t realize — it’s called the Center for American Progress. This report that came out — this is the group that’s trying for the Fairness Doctrine. Trying to, I think, dramatically upend the First Amendment. And try to stop talk radio and talk TV from being conservative.

FOX: And she was a member of that group?

INHOFE: Yes, she was a member of that group. It’s called the Center for American Progress.

And what a radical group the Center for American Progress is, what with all the ex-Clinton staffers and panel discussions and occasional free sandwiches. ¡Viva la revolucion!

Why, if more people join this free-love-and-abortion outpost, we can expect more white papers and open-to-the-public lectures, and before long we're living in the People's Republic of China!

(I recognize that this only holds if CAP expands their budget to hire more staffers. Hey, I know I'm ready to join up with the movement! Up against the wall, motherfuckers!)

The Dead-End Kids

Eve Fairbanks has an important piece about the deepening conservatism in the Congressional Republican caucus. They have been emboldened by their little model Congress stunt on offshore drilling in August, which led to a predictable capitulation from Democrats and the prospect of oil rigs on the California coast within a couple years. Despite the will of the voters at the polls, Republicans learned the lesson of 2008 is that if they stamp their feet and scream loud enough, there is no limit to what they can achieve.

The episode was the happiest moment of the House Republicans' two years in the minority. But, for House conservatives, the energy insurgency provided far more than mere satisfaction: It became a blueprint for the future. Forget the self-flagellating remedies proposed by white-flag Republicans like David Frum or the Sam's Club crowd. The House right-wingers concluded from the drilling victory that conservatism needn't compromise ideologically in order to win--just the opposite. It's a lesson they're eager to apply to Barack Obama's economic schemes, like health care reform and the huge infrastructure stimulus package. Rather than accepting the implications of John McCain's recession-driven loss--that Americans, perhaps, might be growing weary of Republican economics--the conservatives intend to trigger a popular revolt, like the one they provoked over drilling, against Democrat-led socialism itself.

Conservatives may have dwindling ranks, increasing illegitimacy and the headwind of a very well-liked incoming President eager to implement a popular agenda to deal with. But that is simply not what they gained from the election season. Their take was that McCain was insufficiently conservative (!) and that, besieged on all sides, they must stand up for the people and put the brakes on this whole "change" fad. They have nothing left but ideology, and the Drudge/Fox/talk radio megaphone that it still able to mainline that ideology into the public opinion stream. The years of groupthink have proved to BOTH sides in Washington that only conservative populists are the holders of the popular will, regardless of, you know, election returns.

By the time Pence and his pro-drilling confederates stormed the House floor on August 1, Republicans were primed to accept the ensuing battle's lessons: One, dramatic gestures pay; two, conservatives don't have to compromise to capture the people's imagination. "When [Pelosi] and other Democratic leaders felt the force of America against them ... Americans let their voices be heard, and they were enraged, and it affected the way the [energy] bill was put before the House," explains Representative Louie Gohmert, a bald, cheerful judge from Texas who got swept up in the August excitement.

Soon, as Lehman Brothers melted down and Treasury Secretary Henry Paulson rushed around the Hill begging representatives to do something, a new menace ripe for attack emerged: government intervention in the free market. Psychologically rejuvenated by the energy fight, conservatives turned their newfound taste for melodrama against government bailouts. Hensarling derided the September $700 billion plan to rescue the financial industry as a "slippery slope to socialism," and Thaddeus McCotter, a conservative from the Detroit suburbs, exclaimed that "it was no mistake that, during the 1917 Bolshevik revolution, the slogan was 'Peace, land, and bread.' Today, you are being asked to choose between bread and freedom. I suggest that the people on Main Street have said they prefer their freedom!"

All 17 House Republican freshmen rejected Boehner's tearful pro-bailout appeals and signed up with Hensarling's mutiny against the first bailout vote. And the enthusiastic response from constituents confirmed the conservatives' view that, while America (perplexingly) might not be planning to vote for them, it stood with them. As Culberson posted proudly on Twitter: "Texans core belief =leave me alone: gov't stay away from my home, my family, my church, my school, my bank account & my guns." Even Boehner became a believer. After the GOP's loss on Election Day, its second in a row, he promoted Pence, his old rival, to the leadership team and mailed a letter to House Republicans praising the conservatives and vowing to use the energy episode as his battle plan.

The bailout bill was ideologically muddled by the fact that it was designed to funnel money to giant investment banks at least partially responsible for the financial meltdown, and as such is not the best example. But what's significant is the language used, the simplistic shibboleths of "freedom" and "socialism". These didn't work during the Presidential campaign, but when they are channeled into populist proposals that Democrats haven't successfully pushed back on, the result could be dangerous.

Gohmert, the conservative Texas judge, had the brainstorm for his own contribution to the coming wave as he emerged from anesthesia a few days before Thanksgiving. He'd just undergone surgery to repair his anterior cruciate ligament, torn in the annual House softball game, and, as he lay recovering, he was possessed with the germ of an idea. He dropped an e-mail to Newt Gingrich. "He wrote, 'Do you realize that the amount of money they want [in the remaining, as-yet-unused $350 billion of the Wall Street bailout fund] is so great that you could actually give every American a tax holiday for two months?'" Gingrich remembers: "I looked at it and I thought, wow, what a great way to quantify it." Newt shot back a message predicting that a two-month holiday on both income and Social Security taxes--proposed by Gohmert as a conservatively populist, don't-let-Big-Brother-take-your-money alternative to the bailouts--would be "brilliant." "I don't get a lot of e-mails from anybody, especially somebody as smart as Newt, saying 'This is brilliant,'" Gohmert modestly admits.

I don't think anyone has invalidated that "let the people have their own money" approach. Obama's transition team is talking about reducing withholding taxes to give tax cuts to working Americans (which is a behavioral economics scheme based on the idea that people will spend an extra $20-$50 they get every two weeks instead of a lump sum of $500 or $1,000, which would just go to paying down debt). Traditional media still foregrounds ideas like "sales tax holidays" forwarded by lobbying groups like the National Retail Federation. And conservative economists can still credibly view the stimulus choice as one between tax cuts and public spending, and call on 40 years of demonization of government to trot out tax cuts yet again as the solution. After all, Obama's proposed it, so it's just a matter of more of them and less of that nasty big-spending liberalism.

The goal will be to end or moderate the recession. According to the textbooks, government spending raises the demand for goods and services. Tax cuts also spur demand by putting more income in the hands of consumers or more after-tax profits in the hands of businesses.

Is a fiscal stimulus good policy? The answer is no if the stimulus consists of increased spending. The stimulus may be good policy, though, if it consists of lower taxes.

See? They're just the same, only lower taxes lets YOU keep YOUR money, and big gubmint spending steals your money for pork. Pork!

There really is nothing left for conservatives to argue beyond "that way lies socialism." As Fairbanks explains, this is the same strategy they used in the 1930s to try and slow down the New Deal. They argued to themselves that Roosevelt was just a charismatic leader and his policies were abhorrent to the majority of the public. They tried to corner the 1930s version of Blue Dog Democrats to get them to flip their votes. They believed the country was center-right and that by holding to their convictions, they could not fail. What else could they do, other than disband? The strategy wasn't very successful then. Nowadays, there is the constant hum of the noise machine and a right-wing movement well-practiced in the art of obstruction. Not to mention a Democratic majority that fetishizes bipartisanship and timid in the face of these cries from the other side.

(I'm wondering about the connection between dead-ender conservative populists and the "Lost-Cause" mythmakers of the South. Michael Lind calls for a "Third Reconstruction" of the South to save the US economy, while Ed Kilgore has a contrarian view, while acknowledging that "first-wave" economic strategies of low wages, deregulation and the absence of unions have taken hold in the South in the Bush era.)

A lot of commenters and writers in the blogosphere thinks that we should just dismiss the conservative populists and let them play their little games, that the elections have rendered them irrelevant. I don't subscribe to this point of view. We still have a media inclined to promote conflict, and a steady stream of right-wing operatives ready to get their position into the discourse. Further, the imbalance between extreme partisan warfare on one side and the desire to play nice on the other persists. Past history of Congressional capitulation is not promising here. Not to mention that so many of the initiatives the incoming Administration wants to implement need to happen fast to maximize their effectiveness, giving the dead-end kids a piece of leverage that they are sure to use.

Cranks like this are present in virtually every new Administration, but in our current media/political age I think they are uniquely equipped to succeed. And I don't see a real strategy to counteract them yet.

Kitchen Sink Employed In Last-Minute Smear Strategy

This is the final primal scream for John McCain and the right. After decades of feeling entitled to the levers of power, of shrugging off responsibility and accountability, they are having to deal with the consequences of the failed policies of the conservative era. So as a result, they are going heavily on the attack.

There are the new set of nasty robocalls, now being employed in McCain's home state of Arizona, where multiple polls have now shown the race to be close and where Obama is mounting a last-minute surge.

There's the latest deliberate misinterpretation of Obama's tax policies, pretending not to understand that "over $250,000 gets an increase" and "under $200,000 gets a cut" can both be right at the same time.

Obama has said throughout the campaign that families making less than $250,000 a year will not see a tax increase. Those making less than $200,000 will get a tax cut, he says. "If you make less than a quarter of a million dollars a year, you will not see a single dime of your taxes go up," Obama said during an October 7 presidential debate in Nashville, Tennessee. "If you make $200,000 a year or less, your taxes will go down."

The campaign ad McCain refers to, titled "Defining Moment," does have a graphic appear on the screen that says, "Families making less than $200,000 get tax cut." Obama says, "If you have a job, pay taxes and make less than $200,000 a year, you'll get a tax cut," which is, again, consistent with the plan he has
laid out.

Biden was speaking Monday, October 27, in an interview with WNEP in Scranton, Pennsylvania. He said, "(An) $87 billion tax break doesn't need to go to people making an average of $1.4 million. It should go like it used to. It should go to middle class people — people making under $150,000 a year." Biden never says that tax breaks should "only" go to such people. The Obama campaign says he was merely using that figure as an example and that the statement does not represent a change in policy.

The Verdict: False. What McCain is doing here, in part, is comparing apples and oranges. He compares two different aspects of Obama's tax plan as if they were the same. And Biden never said people making less than $150,000 are the "only" people who would get a tax cut under Obama's policies.

There's the latest attack ads basically calling Obama a Marxist-Leninist committed to handing out "welfare," one of which is so rushed that it includes a misspelling and the other clearly spelling out the word "blacks" to answer the question, I assume, of where the money goes.

There's this latest crusade against the media, attacking the LA Times for publishing a story friendly to him several months ago that he apparently just noticed. And by the way, the attacks on Rashid Khalidi are ridiculous, especially considering that McCain and Khalidi have worked together:

Of course, Khalidi has been involved in Palestinian causes. McCarthy ought to ask John McCain about that, because McCain and Khalidi appear to have some joint interests, and that fact speaks very well of both of them. Indeed, the McCain–Khalidi connections are more substantial than the phony Obama–Khalidi connections McCarthy gussies up for his article. The Republican party’s congressionally funded international-networking organization, the International Republican Institute–long and ably chaired by John McCain and headed by McCain’s close friend, the capable Lorne Craner–has taken an interest in West Bank matters. IRI funded an ambitious project, called the Palestine Center, that Khalidi helped to support. Khalidi served on the Center’s board of directors. The goal of that project, shared by Khalidi and McCain, was the promotion of civic consciousness and engagement and the development of democratic values in the West Bank. Of course, McCarthy is not interested in looking too closely into the facts, because they would not serve his shrill partisan objectives.

And of course, at the end of the campaign we are getting the full Jeremiah.

The National Republican Trust PAC, which has been airing an ad attacking Barack Obama's association with Reverend Wright in three battleground states, has now put down for a national buy on five networks that will last from now through election day, a consultant with the group confirms to me.

The ad will run nationally on Fox, CNN, ABC, CBS, and NBC for the next five days, the consultant, Rick Wilson, says -- "all the way until election day."

The ad, which you can watch here, features the now-infamous footage of Wright's livelier sermons, and intones that Obama "never complained" about Wright "until he ran for President," adding that Obama is "too radical, too risky."

The Democratic Web presence has done a good job smacking down and ferreting out these attacks, but it seems like lately there are almost too many to chronicle. The conservative attack machine still has a pulse and they're still going to try and smear Barack Obama. We'll see if it works.

This Is What Happens When You Have No Narrative

You end up contradicting yourself 1,000 times because you can't keep your stories straight.

McCAIN: Now, of course we have an obligation to take care of citizens in our society who can’t care for themselves. That’s why we have those programs, those Safety Net Programs. But you know, the Safety Net Program, a lot of Americans pay in to Social Security, they pay in to a number of those programs. So the point is, yes, a society and government takes care of citizens who need our help. That’s what America is all about.

This from the guy who called the Social Security system a disgrace.

And taking this a step further, wouldn't taking care of the citizens in society who can't care for themselves be an example of ... perish the thought ... spreading the wealth?

Somebody call Joe The Plumber!!! We're a nation of socialists!

By the way, Obama today punctured the socialism nonsense nicely today, through outright mockery.

"By the end of the week, he'll be accusing me of being a secret communist because I shared my toys in kindergarten," Obama said, as per the prepared remarks. Then he added: "I shared my -- I shared my peanut butter and jelly sandwich."

In a similar vein:

"Spending $150,000 for a one month wardrobe while painting yourself as a 'hockey mom' or the voice of 'Joe Six Pack' is an insult," says CNA executive director Rose Ann DeMoro. "There's been a lot of talk about Marxists in this campaign, but the real Marxist is in the McCain camp – she's just a Neiman Marxist."

Never underestimate the galvanizing power of calling someone a fool.

Audition Tape

This Barbara West lady put together quite the comedy show with Joe Biden, hasn't she? Apparently she gets all her questions from email forwards and Free Republic comment threads. I mean, this is unbelievable.



What bothers me, from the standpoint of Joe Biden's judgment, is that it's clear he went on this crackpot's show TWICE. Joe, no subset of the electorate is worth it!

As for the "Marxism" comments, which I dealt with earlier, I think Jon Chait's headline says it best:

McCain: Obama Wants to Have a GOVERNMENT in WASHINGTON!

If you want to espouse the hardcore libertarian argument that roads aren't worth building and cops aren't worth paying and there is nothing that ought to be created for common purpose in America, well go ahead. It'd sure be a lot more honest than this deceptive "the poor luckie duckies are taking your hard-earned money from your wallet" nonsense.

And if you want to ask Barack Obama what his policies are, he'll tell you.

Look - we've tried it John McCain's way. We've tried it George Bush's way. Deep down, Senator McCain knows that, which is why his campaign said that "if we keep talking about the economy, we're going to lose." That's why he's spending these last weeks calling me every name in the book. Because that's how you play the game in Washington. If you can't beat your opponent's ideas, you distort those ideas and maybe make some up. If you don't have a record to run on, then you paint your opponent as someone people should run away from. You make a big election about small things.

Ohio, we are here to say "Not this time. Not this year. Not when so much is at stake." Senator McCain might be worried about losing an election, but I'm worried about Americans who are losing their homes, and their jobs, and their life savings. I can take one more week of John McCain's attacks, but this country can't take four more years of the same old politics and the same failed policies. It's time for something new [...]

Now, I don't believe that government can or should try to solve all our problems. I know you don't either. But I do believe that government should do that which we cannot do for ourselves - protect us from harm and provide a decent education for our children; invest in new roads and new science and technology. It should reward drive and innovation and growth in the free market, but it should also make sure businesses live up to their responsibility to create American jobs, and look out for American workers, and play by the rules of the road. It should ensure a shot at success not only for those with money and power and influence, but for every single American who's willing to work. That's how we create not just more millionaires, but more middle-class families. That's how we make sure businesses have customers that can afford their products and services. That's how we've always grown the American economy - from the bottom-up. John McCain calls this socialism. I call it opportunity, and there is nothing more American than that.

Understand, if we want get through this crisis, we need to get beyond the old ideological debates and divides between left and right. We don't need bigger government or smaller government. We need a better government - a more competent government - a government that upholds the values we hold in common as Americans.

Strong closing argument speech from Barack Obama.

The Final Days

I fully expect one last-minute "Shocking revelation!!! Must credit Drudge!!!eleventy!1!" for each remaining day until the election. John McCain has run his entire campaign from news cycle to news cycle, and so they'll grasp on to whatever they can manage to find. Today's big hit is a 2001 interview with Barack Obama about the civil rights movement, where he lamented the movement's propensity to lean on the courts to mandate changes as opposed to building social change from the bottom up within local communities. That's pretty much all he said, but because he used the words "redistribute" and "wealth" every conservative in America figures they've cracked the Da Vinci Code and revealed Obama for the Maoist-Leninist-Marxist-Communist-socialist that he is. The key quote is this:

"And I think one of the tragedies of the civil rights movement was that the civil rights movement became so court-focused, I think there was a tendency to lose track of the political and organizing activities on the ground that are able to bring about the coalitions of power through which you bring about redistributive change, and in some ways we still suffer from that," Obama said.

That's not only a pretty conservative (not in the political sense) argument, it's echoed by conservative legal scholars.

Now here's how the McCain campaign deliberately misinterprets it:

"Barack Obama expressed his regret that the Supreme Court hadn't been more 'radical' and described as a 'tragedy' the court's refusal to take up 'the issues of redistribution of wealth.' No wonder he wants to appoint judges that legislate from the bench," Holtz-Eakin continued.

This is reminiscent of the "global test" brouhaha from 2004, where Bush officials went ahead and misinterpreted a line from John Kerry for their own ends. It's a very common and even tired political trick.

On the substance of whether or not we should accept "redistribution of wealth" in society, perhaps it's better to flip the question. Does the McCain-Palin ticket defend the extreme concentrations of wealth - with CEOs earning hundreds of thousands of dollars a minute and sitting on the proceeds rather than creating jobs - that exists in this country today? The owners of the top 1% of wealth have more than the bottom 90%. The top 1% wage earners make more than the bottom 50%. Is that in any way sustainable or preferable? Can anyone look into the eyes of the 47 million who have no health care or the other 50-60 million who would go bankrupt if they tried to use theirs and tell them that extreme concentration of wealth is a positive social good?

I would put up the time-honored concept of progressive taxation against the attempt to protect the massive, depression-inducing income inequality we have today.

And furthermore, the definition of socialism, in general terms, is when the state collectivizes the ownership of the means of production and distributes wealth equally across segments of society. You know, like in Alaska.

"And Alaska—we’re set up, unlike other states in the union, where it’s collectively Alaskans own the resources. So we share in the wealth when the development of these resources occurs. … It’s to maximize benefits for Alaskans, not an individual company, not some multinational somewhere, but for Alaskans."

The words, folks, of Sarah Palin.

Battle Royale

This is the kind of stuff that happens shortly after an election, not 10 days prior:

Even as John McCain and Sarah Palin scramble to close the gap in the final days of the 2008 election, stirrings of a Palin insurgency are complicating the campaign's already-tense internal dynamics.

Four Republicans close to Palin said she has decided increasingly to disregard the advice of the former Bush aides tasked to handle her, creating occasionally tense situations as she travels the country with them. Those Palin supporters, inside the campaign and out, said Palin blames her handlers for a botched rollout and a tarnished public image — even as others in McCain's camp blame the pick of the relatively inexperienced Alaska governor, and her public performance, for McCain's decline.

"She's lost confidence in most of the people on the plane," said a senior Republican who speaks to Palin, referring to her campaign jet. He said Palin had begun to "go rogue" in some of her public pronouncements and decisions.

"I think she'd like to go more rogue," he said.

This is one of those delicious stories that we've seen about Democrats for the past several years, but I have a quibble. This is NOT an insurgency. This is jockeying for position inside the party from a position of strength. John McCain is not the future of the GOP - I wouldn't be at all surprised if he went ahead and retired next year. Sarah Palin has the biggest stage in the world for the next ten days and she's going to use it to try to set herself up for a run in 2012.

Check this out today from Iowa (Palin has been in Iowa and New Hampshire in recent days):

SARAH PALIN: John and I will adopt the all-of-the-above approach to meet America's great energy challenges. Yes. [crowd cheers] [...] That means harnessing alternative energy sources, like the wind and the solar and the biomass and the geothermal -- and the ethanol!

A politician pandering to push ethanol in Iowa is unremarkable. But John McCain has made opposition to ethanol subsidies one of the bedrocks of his campaign, an example of how he puts his "country first." You know, we actually don't need to have these massive subsidies to the corn industry, but that's besides the point. Palin is no longer promoting the ticket, she's promoting herself.

It's kind of fascinating to watch, I must admit. Palin has gone completely off message and McCain's staffers are rebelling. They're going public with the recriminations, maybe out of some belief that she would destroy the party as its titular head. I don't know if it's true or not. She has captured the hearts of the hardcore base, and most of the rest of the party is running for cover. Given who's left, I see no reason why she wouldn't be able to consolidate the remnants. She's obviously got the fundie side locked up, and she's charging hard for the economic royalists:

Sarah Palin had a few memorable moments during her campaign stop in Des Moines, Iowa, on Saturday. But the most eye-opening of them all came, it would appear, when the Alaska Governor somehow drew a connection between Barack Obama's tax policy and an encroaching, nightmarish, communist government. The Illinois Democrat, she hysterically suggested, would, through his proposals, create a country "where the people are not free."

"See, under a big government, more tax agenda, what you thought was yours would really start belonging to somebody else, to everybody else. If you thought your income, your property, your inventory, your investments were, were yours, they would really collectively belong to everybody. Obama, Barack Obama has an ideological commitment to higher taxes, and I say this based on his record... Higher taxes, more government, misusing the power to tax leads to government moving into the role of some believing that government then has to take care of us. And government kind of moving into the role as the other half of our family, making decisions for us. Now, they do this in other countries where the people are not free. Let us fight for what is right. John McCain and I, we will put our trust in you."

I don't see a lot to complain about from the Big Money Boyz. And if there's one thing those types like, it's an empty suit (or an empty $150,000 wardrobe) to fill with their conservative mantras. Not to mention how they love a figure who is misunderestimated.

The war to blame either McCain or Palin in the aftermath is going to be so intense that it's already started. And the damning with faint praise we're seeing from McCain allies (Lieberman, Ridge) is part of that brawl. But I'm not certain that can stop her. She's going for it.

...McCain's people calling her a diva is really kind of amusing. It's the SAME attack they made on Barack Obama through the summer. They couldn't manage to mix it up a bit?

Arnold Embarrasses Himself Trying To Shield His Party And His Presidential Nominees

The Presidential campaign on the Republican side has really become ridiculous, with nonsense talk of "socialism" (I guess that's what the kids are calling the progressive tax system nowadays). Here, Arnold Schwarzenegger tries to defend it by playing the "I was born in socialist Europe" card (expect this to be part of his campaign address for John McCain in Ohio next week):

• Schwarzenegger seemed to embrace language that Republican John McCain has been using in his latest attacks against Democrat Barack Obama related to "redistribution of wealth."

"I left Europe because of the socialistic kind of environment and the way countries were run and the way government was on your back and therefore stifled the opportunities in Europe and that's why I came to America," he said. "So I hope -- and that's why I've been always involved in campaigning for political leaders that I believe in, because I wanted to do everything that I can to make sure that America doesn't go back to those days of 40 years ago when I left Europe, that we go back to that system of redistribution of wealth that some people are talking about. There is no redistribution of wealth."

"Redistribution of wealth," apparently, is raising the top tax rate from 36% to 39%. Ooh! Why don't you just give everybody borscht as well? (By the way, hasn't Arnold called for new taxes to fill the budget gap? Um, Arnold, isn't that, er, redistributing wealth?)

But that's not half as embarrassing as this exchange with CNN's Campbell Brown:

BROWN: Do you think she's qualified to be president?

SCHWARZENEGGER: I think that she will get to be qualified.

BROWN: She will get there? What do you mean? She's not ready yet?

SCHWARZENEGGER: By the time that she is sworn in I think she will be ready.

OK, today is October 23. Inauguration Day is January 20. Exactly what is going to happen over three months that would suddenly make Sarah Palin qualified for the office of the Presidency?

The answer, of course, is nothing. But Arnold is a loyal Republican soldier and a "Free To Choose" economic royalist, so he can't see that. What a fraud.

What Has Become Of Comrade McCain

It's beyond ridiculous to hear the progressive taxation system that has served this country for close to 100 years derided as "socialism," but it wasn't so long ago that Chairman McCain was on board:



Considering that the only issue McCain is talking about anymore, outside of Obama being a scary Black radical Muslim, is taxes, the fact that he's flip-flopped on the very issue, in an extremely high-profile way, is really telling. Here's Obama bringing it up:

The irony is that when George Bush proposed the original tax cuts that lowered the rates for the wealthiest Americans, who objected? John McCain. Who said these were irresponsible, and said that they would prevent middle class tax relief, that they weren't properly targeted. Now, was John McCain a socialist back in 2000 when he opposed the Bush tax cuts for the wealthiest Americans? Because all I'm trying to do is reverse those so we can give relief to those that really need help? It's not a very plausible argument that he's making right now, and I think it's an indication that they have run out of ideas.

Oh yeah? Well, spurt, blurb, bluster.... JOE THE PLUMBER!!!elevenone!1!

Keep in mind that ultimately, we're talking about restoring the 39% tax rate for the top bracket from 36%. Historically it's been as high as NINETY percent.

Welfare Queen

Why is the nanny state, in the form of the state of Alaska, caring and feeding for Sarah Palin and her family? Doesn't she know she has to WORK for that money instead of taking a handout?

ANCHORAGE, Alaska – Gov. Sarah Palin charged the state for her children to travel with her, including to events where they were not invited, and later amended expense reports to specify that they were on official business.

The charges included costs for hotel and commercial flights for three daughters to join Palin to watch their father in a snowmobile race, and a trip to New York, where the governor attended a five-hour conference and stayed with 17-year-old Bristol for five days and four nights in a luxury hotel.

In all, Palin has charged the state $21,012 for her three daughters' 64 one-way and 12 round-trip commercial flights since she took office in December 2006. In some other cases, she has charged the state for hotel rooms for the girls.

Actually, $21,000 is chump change compared to what the hockey mom is charging the RNC for her duds:

The Republican National Committee appears to have spent more than $150,000 to clothe and accessorize vice presidential candidate Sarah Palin and her family since her surprise pick by John McCain in late August.

According to financial disclosure records, the accessorizing began in early September and included bills from Saks Fifth Avenue in St. Louis and New York for a combined $49,425.74.

The records also document a couple of big-time shopping trips to Neiman Marcus in Minneapolis, including one $75,062.63 spree in early September.

John Edwards got a haircut, though.

Talk about your redistribution of wealth. I'll tell you, we can't afford Sarah Palin as Vice President. I mean we literally can't afford it.

The New Lucky Duckies

It is remarkable to see McCain play the socialism card on Obama, days after voting for a $700 billion dollar bailout of the banks and the largest government intervention of the last 100 years. The institutional memory doesn't even go back three weeks anymore? Furthermore, he characterizes Obama's refundable tax credits as "welfare," neglecting the fact that his own refundable tax credits, the centerpiece of his entire health care plan, which go to the same low-income members of society who supposedly "don't pay taxes," are not welfare but "reform".

It's silly, but this is very powerful stuff. And I think Atrios makes the salient point.

Basically everybody pays taxes. So you when you're talking about giving free money to people who don't pay any taxes, that must be somebody else because, you know, I pay taxes.

I suppose that works.

Yes, I suppose it does.

FAYETTEVILLE, N.C. — When Sen. Barack Obama entered a barbecue joint here to greet dozens of people eating lunch after church services on Sunday, Diane Fanning, 54, who works at a Sam's Club, began yelling, "Socialist, socialist, socialist — get out of here!"

Plumbers and Joe Sixpacks may make out better under Obama's plans, and McCain is peddling lies. But the way Republicans have historically won elections is by getting some members of the working class to think that other members of the working class are getting away with a free lunch. I don't know if it'll work, but the pull is undeniable and will last well past the election. Wait for the statistics to come out of Rush Limbaugh's mouth about how big a tax cut Obama has given to black people.

After all, this is the type of code they use. And it works.

Herbert reminds us about the Southern Strategy -- and famed GOP strategist Lee Atwater's candid admission: “You start out in 1954 by saying, ‘Nigger, nigger, nigger. By 1968, you can’t say ‘nigger’ — that hurts you. Backfires. So you say stuff like forced busing, states’ rights, and all that stuff. You’re getting so abstract now [that] you’re talking about cutting taxes, and all these things you’re talking about are totally economic things, and a byproduct of them is [that] blacks get hurt worse than whites.”

Bernanke Signs Up For Stimulus; McCain Doesn't Understand Taxes

Now, his conception of a stimulus package and the progressive conception of one are likely to be quite different. But his rejection of neo-Hooverism is as important in the rarefied circles of official Washington as the Powell endorsement is to the Presidential race. Bernanke will be listened to by the Beltway chattering class.

Bernanke suggested that Congress design the stimulus package so that it will be timely, well targeted and would limit the longer-term affects on the government's budget deficit, which hit a record high in the recently ended budget year.

Any stimulus package would need to kick in quickly to entice people and businesses to boost spending and buck up the economy during the period in which economic activity would be otherwise weak, Bernanke said.

Bernanke said the package also should include provisions that would help break through the stubborn credit clog that is playing a major role in the economy's slowdown.

"If the Congress proceeds with a fiscal package, it should consider including measures to help improve access to credit by consumers, home buyers, businesses and other borrowers," Bernanke said. "Such actions might be particularly effective at promoting economic growth and job creation," he added.

This is vague, and there's nothing about funding infrastructure projects or state and local governments. Democrats need to shape this better, and if they have to, wait out Bush. But I'm not worried that there will be some spending, just what form it will take. Even the New York Times is recognizing the consensus around this issue.

But the extra spending, a sore point in normal times, has been widely accepted on both sides of the political aisle as necessary to salvage the banking system and avert another Great Depression.

“Right now would not be the time to balance the budget,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a bipartisan Washington group that normally pushes the opposite message.

The latest thing from the McCain camp is to call this kind of stimulus and middle class tax cuts "redistribution of wealth" and "welfare", that 40% of Americans don't pay taxes (I thought they LIKED it when people didn't pay taxes... maybe that's just rich people) and why should they get a government handout? After all, now is not the time to experiment with socialism (says the governor who gives Alaskans thousand-dollar checks from oil revenues all the time).

It's ridiculous to say that 40% of the country doesn't pay taxes. If you buy a bagel anywhere, you're paying taxes. If you're on a payroll, you're paying taxes. The government collects revenue in a number of ways, and the economic ignorance of that statement is shocking. As Matt Yglesias says:

Payroll tax is a tax, ergo if you work you pay taxes, ergo if you work you could receive a tax cut. It’s true that the method by which you deliver tax cuts to people with no income tax liability is via a refundable tax credit, but that doesn’t change the fact that you’re talking about reducing the tax burden on people who pay taxes. You’re offering them a tax cut, in other words. Or as McCain puts it, “socialism.” Meanwhile, George W. Bush is nationalizing banks and John McCain wants to buy up bad mortgages so that those who currently own them don’t need to pay any financial penalty for their unsound lending practices.

The only "welfare" we have in this country is corporate. Obama hit back on this pretty well.

Lately, Senator McCain has been attacking my middle class tax cut. He actually said it goes to, "those who don't pay taxes," even though it only goes to working people who are already getting taxed on their paycheck. That's right, Missouri – John McCain is so out of touch with the struggles you are facing that he must be the first politician in history to call a tax cut for working people "welfare."

The only "welfare" in this campaign is John McCain's plan to give another $200 billion in tax cuts to the wealthiest corporations in America – including $4 billion in tax breaks to big oil companies that ran up record profits under George Bush. That's who John McCain is fighting for. But we can't afford four more years like the last eight. George Bush and John McCain are out of ideas, they are out of touch, and if you stand with me in 17 days they will be out of time.

To relate it to stimulus, if you want the economy to move in the short term you put money into the hands of people who will spend it immediately and not just store it away. The danger is in JUST doing that - job creation needs to be an element, and I think we're going to see that in the next package.