Is the Bailout Dead?

Weird goings on in Washington today as far as negotiating some kind of bailout for failing banks and Wall St. firms.

Earlier today it looked like an agreement had been reached where about half of the Bush administration's 700 billion dollar request would be granted, with additional money available after Congressional approval. Evidently that's fallen apart. It was put together by a bipartisan group of congressmen (and women) but without much leadership input from either side.

Now the word tonight is that deal is dead, and the GOP is pushing an alternative package that would have the government guarantying insurance packages for firms that agree to buy the "bad" debt from banks and brokerages. This would be a better solution in the GOP eyes since it keeps the government out of the ownership business of the firms.

It may also be a better idea based on those pesky accounting rules I keep mentioning. Firms buying the mortgage debt will be more likely to pay close to what it's worth if they can get that purchase insured. The government would have just made offers "you couldn't refuse" that may not have reflected the true value of many of the investments. If that's the case, many other portfolios of mortgage backed securities will suddenly see their value increase.

I'm not sure what will finally get hammered out as the solution to the current crisis, but my guess is that it will have less government ownership of firms that Bush proposed, and probably less market control that the GOP delegation in Congress would like. We should know in the next 48 hours what they finally decide on though.

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McCain's Flip-Flop on Drilling

John McCain finally came to his senses (flip-flopped) on the issue of off shore drilling on the continental shelf for oil. Maybe gas at $4 bucks a gallon finally got him to realize that no matter how much we claim we want to be environmentally friendly, oil will still be running our economy for 50 or so years. Maybe he realized, finally that energy independence won't consist of the sun, and wind alone, and that producing our own oil AND developing alternatives aren't mutually exclusive.

Barack Obama, on the other hand, is sticking to the same, very old, line from the environmentalists "that oil won't reach the market for 5 years"; last week it was 10 years. Maybe he should acknowledge that if we'd been drilling since the first moratorium on shelf drilling was passed 27 years ago, we would have stopped hundreds of millions of barrels of oil per year from be bought from tyrants, despots, and unstable countries.

Will the McCain, (or Bush) plan for the shelf bring pump relief immediately? No, it won't. But it will show up sooner than 5 years. Simply put oil is sky high based on speculation that supplies are going to get tighter and tighter. If you open up reserves holding 20-30 billion barrels of oil, (a 1960's estimate), suddenly that supply doesn't look as tight as it did. The market starts seeing more supply being available, and suddenly the futures position on oil isn't as tempting as it was.

For those who say "but we need to develop alternatives" consider the best alternative most folks site is hydrogen. To get enough hydrogen to replace oil, cost effectively and as a net energy gain, the only way to do it is cracking natural gas. We are currently a net importer of that resource also. (Thanks Congress!!!)

The Eastern Continental Shelf reserve holds hundreds of TRILLIONS of cubic feet of natural gas, which also could be used in cleaner burning electric generation, to reduce the use of heating oil in the North east, etc. But unless we drill there, we don't get to use it. We get to buy it from Canada, Trinidad, and Egypt.

Consider a few other thing about getting off of oil. Aircraft aren't going to fly on solar power or fuel cells anytime soon. Trains aren't going to run on either efficiently, nor are large trucks. Steel isn't going to be produced (cost effectively) using electricity as the sole heater of the metals. And thousands of daily items from sandwich and garbage bags to baby bottles require petroleum products to produce. In other words, Oil is going to stick around for a long time. The question is where do we get it, here, or from Hugo Chavez?

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Outing McClellan

Scott McClellan's book "What Happened: Inside the Bush White House and Washington's Culture of Deception." has been all the rage in liberal circles for the last week or so. They are eating up the fact that McClellan spent lots of words on the Valerie Plame case, and wishing Karl Rove had been fired over it.

They guy who printed Plame's name, Robert Novak, has his take on the book in today's column, and calls out McClellan for his lack of facts about the Plame affair.

Novak points out the inconsistencies between the former White House Press Secretary's book, and the reality of the leak, and the Grand Jury investigation into it.

While at the White House podium, McClellan never knew the facts about the CIA leak, and his memoir reads as though he has tried to maintain his ignorance. He omits the fact that Armitage identified Mrs. Wilson to The Post's Bob Woodward weeks before he talked to me. He does not mention that Armitage turned himself in to the Justice Department even before Patrick Fitzgerald was named as special prosecutor.

In case the liberals out there have forgotten, Rove, and Scooter Libby, weren't the leakers of Plame's name. It was Richard Armitage, a guy who didn't like the Iraq war or Dick Cheney. Novak also points out another fact McClellan omits, no one was convicted of outing Plame, even though the Justice Department had a confession from Armitage that he'd been the guy to mention her name.

When you start reading the facts; instead of McClellan, and his publisher's wishful thinking; you realize more and more that the book wasn't a "tell all" about the White House, but instead a smear job without much basis in reality, written by a disgruntled guy who was fired.

It becomes more clear when you follow the trail of the publisher, who McClellan told Ari Fleischer (his predecessor) had "tweaked" the book. The publishing house, Public Affairs Books, is largely owned by Democratic activist George Soros!

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Obama Jumps Church

So, Senator and Presidential wannabe Barack Obama has decided to leave the Trinity United Church of Christ. He's clarified remarks about it, and decided it wasn't "a political manuever". Sure, and the 465 foot shot Russel Branyan hit in Milwaukee last night wasn't a home run.

Over at the Chicago Tribune, The Seeker blog asked the question "What do you think? Can a political figure join a congregation without putting it and its spiritual leader under the microscope?"

The answer of course, is yes. It happens all the time. In fact, Dick Cheney, one of the most despised politicians in the country goes to church regularly, can anyone name his pastor? How about George Bush's? Hillary Clinton?

The problem with "The Seeker" question was that it should have been "Can Obama pick a pastor that won't put himself under the microscope." Keep in mind, Oprah Winfrey left that church years ago because of Rev. Wright. So it's not like he just recently went off the deep end.

The Swamp has more insight from Obama on his decision, but the more he talks, the more it appears that he made a calculated political decision. While he says that he doesn't want the church coming under more scrutiny because of his candidacy, I think that the opposite is true, he's tiring of the scrutiny he's receiving for his choice in associates.

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Hating History

"Some seem to believe we should negotiate with the terrorists and radicals, as if some ingenious argument will persuade them they have been wrong all along," Bush told the Israeli lawmakers. "We have heard this foolish delusion before. As Nazi tanks crossed into Poland in 1939, an American senator declared: 'Lord, if only I could have talked to Hitler, all of this might have been avoided.' We have an obligation to call this what it is -- the false comfort of appeasement, which has been repeatedly discredited by history." George Bush to the Isreali Parliment (from the Washington Post)

Some folks are very upset by the above remark made yesterday during Israel's 60th Anniversary celebration. Evidently, pointing out historically correct analogies to today's world bothers the current group of appeasers, known mostly as Democrats here in the US.

If you read it, you'll see no names, no political parties, no groups are named, other than the Nazi's, yet the Democratic party, from the top down, called it a shot at them collectively, and Barack Obama, specifically.

Hillary Clinton denounced the remark, but is probably thankful that he didn't use more recent examples to make his point. The sell out to North Korea in the 1990's, providing tons of food, heating oil, and reactor technology for power generation didn't stop them from developing a nuclear weapon. Instead, it gave the North Korean army tons of food and fuel, while millions starved and froze to death in their country.

The problem with the appeaser position, that we can negotiate an end to terrrorism, be it in general, or against Israel is that you need both sides to be willing to concede on a major point. In the case of Israel and a Palestinian state, that both have a right to exist.

The US, and world in general, through the Oslo Accords, the "Road Map" strategy, and countless other negotiations have agreed that a Palestinian State should be an end goal. Iran, Hamas, Syria and general Palestinian population however, still hold that Israel should be wiped out. So what is the beginning position for negotiating with them? Do the Democrats believe if only they were listened to, this could all be over? If that's the case, then why, from 1993-2001 didn't all these problems go away when they were in power?

The Camp David Accords don't provide any help in this, situation. Egypt went into those negotiations with a grudging willingness to accept that Israel was there to stay. There is no such willingness on the part of Iran or Syria (Hama's bankers) to accept that point, so there is little room for negotiation with them.

Barack Obama wonders why he has such a low standing in the Jewish community, not seeing that appeasing leaders like Ahmadinejad of Iran fuels their anger towards him.

John McCain, to his credit, stood by Bush's comments, and even fired a few shots at Obama and the appeasement crowd. He gets that fact that until the Iran's of the world submit to a few major points; like the existence of Israel, and the ending of state sponsoring of terrorism; there is no place for negotiation with them.

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The Limbaugh Litmus Test

Rush Limbaugh and many other far right pundits have come up with a new litmus test that, they say John McCain fails. So lets look at some of the points on it, and see how other prominent Republican's do on them.

1. Illegal Immigration, we all want secure borders and no guest workers.

Ronald Reagan signed the biggest amnesty bill ever seen, it was extended by George H.W. Bush (and Bill Clinton). It did nothing to secure borders, and required only a six month wait to apply for a green card, and expanded half a dozen different types of temporary worker visas.

George W. Bush championed legislation similar to the 2005 McCain-Kennedy bill that
failed, and the toughened up 2007 bill. Rush didn't rail against him in 2000 or 2004 though, when it was known he wanted to include a guest worker program in immigration reform. He'd said during his campaigns, and as Governor of Texas.

2. Taxes, everyone wants a "Reagan Conservative" to take ahold of the tax problem, and claim McCain isn't one because he wanted spending cuts before tax cuts. Yet he's never voted for a tax increase while in office.

Ronald Reagan signed at least 8 bills that RAISED taxes during his 8 years in office. Yes, he did sign some tax cuts too, but if you are being honest you have to look at it both ways. In 1983 he said we'd get $3 in spending cuts for every $1 in tax increases. In 1993 he complained that Congress never cut spending. (Bruce Bartlett of NRO wrote a great piece on this in 2003)

George H.W. Bush .... read my lips, this answer is too obvious

George W. Bush, at least he can say that he hasn't raised them, though he only got temporary cuts passed, which look to expire in a few years.

3. Supreme Court Justices. Everyone on the right is screaming for constructionist justices and worried that McCain won't appoint the "right kind" of people. But how did our past GOP presidents do? Not well, of the 6 appointed prior to GWB taking office you have 2 conservatives, 2 liberals and two swing voters.

Reagan appointed three justices, Kennedy, O'Connor and Scalia. Of the three Scalia is the only one who has retained his "constructionist" credentials. Both Kennedy and O'Connor turned into swing votes upholding Roe v. Wade and other "liberal" decisions from the Warren Court.

George H.W. Bush put David Souter and Clarence Thomas on the bench. Thomas is possibly the most conservative justice sitting, while Souter is more often than not in the liberal block on the court.

Gerald Ford nominated John Paul Stevens, a Nixon appointee to the appellate bench, and who's the most liberal member of the court by most counts.

4. 1st Amendment. McCain gets beaten on unmercifully for the McCain Feingold measure, yet Rush & Co. didn't have much to say about it in 2004, after George W. Bush signed it into law. While McCain authored it Bush signed it into law, instead of vetoing it, why didn't they cry and vote for John Kerry in 2004?

Spending is an area where McCain bests the above list, for 25 years has championed lower bugets.

Reagan only tried cutting it after the Gramm-Rudman and later Gramm Rudman Hollings acts were passed to try and reign in spending. GHWB did a better job, but still increased spending in many areas. While Democrats point to the "Pay Go" day's of the 1990's as a great spending control, like today's Paygo it's smoke and mirrors. The Pay Go bills of both eras had 4 years life spans, and new programs enacted generally waited (and still do) until the fifth year to have their full costs paid, thereby getting around the tough cuts or tax increases. This years $168 billion unfunded "economic stimulus package" is a great example of the swiss cheese like character of Paygo. We don't even need to get into GWB's spending record and lack of veto pen especially in his first term.

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