Looking Forward

I have been spending a lot of time reading economic commentary for 2008 and 2009.   I think the most sobering analysis has been coming from Nouriel Roubini of RGE Monitor.  While a lot of economic analysis seems to form the consensus that things will slow down in 2008 and pick up in 2009, Roubini talks about the possibility of financial meltdown and the inability of the Fed to stop it.  I think that Roubini and Jim Grant were amongst the minority of market watchers that were pessimistic about the financial system a few years back.

My observations on the matter are not as pessimistic.   There are major stability issues of the financial markets right now.   While everyone is focused on the subprime mortgages, I think what is not seen right now are the substantial increase in delinquencies and defaults of auto loans and credit card debt.  All of this is the sign of reckless debt financed consumption by the American consumer.   Even without the defaults, the typical consumer is over-leveraged, and more and more are in negative equity situations, thanks to falling home prices.   I believe the next two years will be a period of paying off debt.   The stimulus package passed by Congress  will not stimulate anything;  for the bulk of people, it will be used to pay off debts from consumer spending that stimulated the economy a few years ago.  This definitely implies that with the consumer fixated on paying off debt versus other spending, that the economy will soften.  

What will amplify this slowdown is the precipitous fall of the value of the U.S. Dollar, which is also driving inflation.  The Federal Reserve has little choice right now but to provide liquidity to the banking system at the cost of inflation and further declines of the dollar.   Consumers will now face a lower standard of living after years of living beyond their means.  The federal government has not helped the problem with their profligate spending and deficits.  If the Democrats take over the White House in 2008, and embark on a program of tax increases, this will only exacerbate the situation.

The Subprime Mortgage Crisis in Cartoon Format

This is a classic, and a heartfelt thanks to Captain Capitalism for the link.  

Back door Sharia in Ontario

The Toronto Sun reports that Ontario muslims in polygamy are getting multiple welfare benefits, much like in the U.K.  Why is the  West slowly surrendering it's values in the name of multiculturalism, so a civilization intent on destroying the foundations of the West - freedom and pluralism.

Mark Steyn at CPAC

A great stump speech by Mark Steyn at the Conservative Political Action Conference, yesterday in D.C.

Michael Barone on the Detroit Riots

Michael writes about his first hand experience in Mayor Jerome Cavanaugh's office during the 1967 riots in The American magazine.   Barone's impart is that the primary role of local government first and foremost is to preserve order.

Immature Civilization

Check out this article in The City Journal by Kay Hymowitz, called "Child-Man in the Promised Land. It focused on the delayed adulthood of people today. A teaser for it:

Not so long ago, the average mid-twentysomething had achieved most of adulthood’s milestones—high school degree, financial independence, marriage, and children. These days, he lingers—happily—in a new hybrid state of semi-hormonal adolescence and responsible self-reliance. Decades in unfolding, this limbo may not seem like news to many, but in fact it is to the early twenty-first century what adolescence was to the early twentieth: a momentous sociological development of profound economic and cultural import. Some call this new period “emerging adulthood,” others “extended adolescence”; David Brooks recently took a stab with the “Odyssey Years,” a “decade of wandering.”

But while we grapple with the name, it’s time to state what is now obvious to legions of frustrated young women: the limbo doesn’t bring out the best in young men. With women, you could argue that adulthood is in fact emergent. Single women in their twenties and early thirties are joining an international New Girl Order, hyperachieving in both school and an increasingly female-friendly workplace, while packing leisure hours with shopping, traveling, and dining with friends [see “The New Girl Order,” Autumn 2007]. Single Young Males, or SYMs, by contrast, often seem to hang out in a playground of drinking, hooking up, playing Halo 3, and, in many cases, underachieving. With them, adulthood looks as though it’s receding.

It is a rather profound effect. Read Hymowitz's related article The New Girl Order. Diana West makes mention of it in her book "the Death of the Grown-Up". Mark Steyn makes comment about this in many of his writings. One of his prescriptions is to return to the idea of a thorough K-12 education, not the fixation on University; his point is with the decline in standards and achievement has made K-16 (public school and university) is now marginally poorer than K-12 of forty years ago.

More Primary-polooza

It now appears that, at least on the GOP side, that things are beginning to settle and that John McCain is the presumptive nominee.   What I think is the main story is two fold.    The first is that until last night, no candidate was really overwhelming the primary electorate.  Second, is the disconnect between Romney in the polls and Romney in the ballot box.   It appears that poor Mitt has a hard 35% ceiling, and for one reason or another, is not connecting with voters.

The GOP Primaries so far - musings

I have been watching the GOP primaries with a lot of attention, the political junkie that I am.   With Nevada and South Carolina this Saturday, we are drawing to the end of the "retail " segment where candidates can spend a lot of face time with potential voters.

Call this an endorsement or not, here are my observations on the candidates so far:

• Rudi Guilliani.    He has been out of the limelight, choosing to make a stand in Florida and Super Tuesday, letting the other candidates use up cash fighting each other.   This could be a brilliant move or will backfire, depending on how he does in Florida and on Feburary 5th.   It is plausible that he comes out of the February 5th primaries with the delegate lead, but that remains to be seen.   In terms of the debates and substance, he has done OK overall.  He emphasizes his executive accomplishments, explains his liberal social views in a way that is non-threatening, while acknowledging that people with views outside of his have valid concerns.  He has tried to address them without flip-flopping or out and out pandering.    As to my opinion, while I have some concerns on this matter, specifically 2nd ammendment issues, I think Rudy overall has made himself an acceptable candidate.  I think that he may become the compromise nominee.
  
• Mike Huckabee.    Yes, he is charming, engaging, and funny at times.  He just rubs me the wrong way though.  I do not trust him on policy issues - as I think he is a Christian nanny stater.  His views on immigration, education, taxes, smoking, foreign policy and federalism are anathema to traditional conservatives.   His fair tax proposal is pie in the sky and will not work with a federal government the size it is.  Now, if you want to bring the scope of the federal government back to where it was in 1913, it would work, and I would wholeheartedly support that.  But with the welfare state as it is - the fair tax will not work.  He is unaceptable as the nominee and a Huckabee candidacy would be Jimmy Carter redux.
• Mitt Romney.    Mitt has the policies right, but his presentation is in some ways is offsetting.   You would think that he would have won Iowa and New Hampshire, but somehow he has not closed the deal with primary voters - which would indicate some skepticism.   I think some of this can be addressed with better communications.   He has the resources to lead the delegate count after February 5th, but he has his work cut out for him.   Right now, he is the de facto establishment candidate within the party.  He would be an acceptable candidate, and would be a good president, but needs to do more to address concerns amongst the electorate.
• Ron Paul.  He is interesting to say the least.  He has had the opportunity to be the figurehead of the libertarian wing of the GOP, but has thrown that out the window with his "blame America first" musings.   His defense of federalism and limited government is solid, but his explanations of his isolationist tendencies come off as bitter.  He could have made a more positive argument on why isolationism works.  That, and his support from neo-nazis and other questionable relationships leaves him as a fringe candidate.   He had an opportunity to start a real movement within the party, but has proven he is not the leader for libertarianism  within the party.   The GOP could use that as a counterweight to the  big government Republicans in the party.  Obviously, he is unacceptable as a candidate.

• John McCain.   He is infuriating to the party base.  While nobody questions his patriotism and credentials on national security, his personality and record on domestic issues have put off large segments of the GOP electorate.   His embrace of anmesty, campaign finance reform, global warming hysteria, and agnosticism on taxes.  What makes it worse is they way he demonizes those who disagree with him on policy -  this is particularly annoying.     His ill temperment and his embrace of many liberal policies will make it difficult to gain delegates in closed primary states.
• Fred  Thompson.  I think Fred is the total package in terms of policy and presentation.   He articulates conservative principles forcefully and in a folksy, easy to understand manner.  His problem is that he started too late and his campagin has fumbled to maximize their opportunities. 

  UPDATE:    Well Fred has dropped out - so much for my endorsement!  Now the question is who the bedrock conservatives go to - Mitt, Rudy, or McCain?

McCain's "blunt talk" has a blaring caveat

I was reading in the Detroit News a story written by Ron French, who IMHO, the best investigative writer the paper has - always a good read).   His story talks about McCains "straight talk" on how the manufacturing sector has a bleak future, and how many economists agree with that assessment.  The article reminded me that McCain, if elected, would be just as detremental to Michigan's economic future.  McCain's embrace of increased CAFE standards, as well as his drinking of the global warming kool aid, would just exacerbate  the problem.  He would be no better than the Democrats, claiming to be for the "working man" but pursuing policies that will just shutter more businesses in the United States and ship them off to where it is more feasible.

Republican primaries so far.

My impressions so far:

• This is still anyone's battle.  The delegates are somewhat evenly spread so far.  Romney has dissappointed with second place finished, but he placed to different candidates and has the money and organization to hold out for super Tuesday in February.  He needs to win a few by then or there is major trouble.
  
• Guiliani's decision to use Florida as his firewall and not contest in the early states seems strange right now.  With the momentum that Huckabee and McCain have now, Rudi has his work cut out.   He needs to get a good number of wins on super Tuesday or else he is in trouble.
• I'm really disgusted with the MSM laying the kid glove treatment to Huckabee and McCain.   Closer examination of their records would show that they have done many things that conservatives find objectionable.   It seems that they want to have the most liberal Republicans win so that the conservatives stay home in November and give the Democrats a win.   We have not hear anything in the MSM about Huckabee's record on tax hikes, tuition breaks for illegals, and pardons of violent offenders.  Neither have we on McCain's record on amnesty, the Gang of 14, opposition to tax increases, embrace of environmental radicalism, and McCain-Fingold.  
• We'll know more on Super Tuesday, but I'm rooting for a Romney win in Michigan and let the chips fall where they may.  I don't think McCain and Huckabee will do well in many of these states because they are closed primaries (no Independents allowed to vote) and this is where we'll see grassroot Republicans show their disdain for these CINO's (Conservative In Name Only).

In a perfect world, Fred Thompson has impressed me the most with his thoughtful policies and gravitas.   Alas, his poor campaign managment skills will probably ruin any chance at the nomination.   So, unless Fred proves me wrong in February, it looks like the most viable choices in my view are Romney and then Guiliani.  Huckabee and McCain are unacceptable as their records show a consistent streak wholly inconsistent with conservative prinicples.  Romney and Guiliani's records are not perfect, but in light of the political landscape of their respective prior positions - their accomplishments look very good.  Both men have said the right things about the principles they would govern under, and have explained their executive records adequately.  

So here's hoping that the MSM cheerleading squad gets proven wrong again.