Perry hits the road

Anyone who has watched the Republican debates knows Rick Perry’s most glaring vulnerability — including Rick Perry.  However, he has steadily improved and had a good debate on Saturday, and now he’s hitting the campaign trail in a big way in Iowa.  And rather than playing to his weakness, this plays right into Perry’s biggest strengths, as the National Journal reports:

    Rick Perry has a reputation as a campaigner in Texas: He’s dangerous, but even more dangerous when he’s down. The next three weeks in Iowa will present him with the ultimate underdog challenge as he undertakes a last-ditch, massive effort to save his presidential bid.

    Wednesday marks the beginning of a 14-day, 42-city bus tour that will see the Texas governor traverse the Hawkeye State, logging more than 1,000 miles as he strives to regain his standing among the top tier of candidates for the GOP nomination. …

    His Iowa tour will begin in Council Bluffs, on the western edge of the state, and run in a semicircle across the northern half of Iowa heading east. After a leisurely break for Christmas — Perry has no events planned from the afternoon of the 22nd until the morning of the 27th — the tour will resume with a swing through the southern part of the state and snake back around to the center. Most days follow a pattern: two to four “meet-and-greets,” often at local restaurants or coffee shops, followed by a town hall meeting in the afternoon.

    As he travels through the state, Perry will seek to build a coalition of evangelical and tea party voters, often attempting to pick off supporters from his rivals. He’s shown as much in the ads he’s run in the state targeting those specific groups. His fight for the Christian right, a key voting bloc during the Iowa caucuses, will put him in competition against Rep. Michele Bachmann of Minnesota and former Sen. Rick Santorum of Pennsylvania.

Assuming his back troubles are behind him (pardon the pun), Perry can be a force of nature in retail politics.  He got off to a good start in Iowa when he jumped into the race, but his immediate rise in national polls took his focus elsewhere.  Now with Iowa the only prize that Perry can reasonably grasp at the moment, he’s going all in — like Bachmann and Rick Santorum, the latter of whom has already visited all 99 counties and has built a surprisingly extensive organization.

Those will be his two main competitors for voters who won’t back either Gingrich or Romney, and of course Perry wants to split social conservatives and Tea Party activists away from Gingrich, if possible.  There is some evidence, although rather thin, that a Perry comeback has already begun.  The latest poll from the American Research Group shows Perry rising to fourth place, but more significantly, into double digits at 13%.  That’s a bounce upward of eight points since last month, trailing only Gingrich’s 19-point rise in the same period.  Ron Paul and Mitt Romney are just ahead of Perry at 17%, putting Perry within reach of a second-place finish.

If Perry can even get to second place in Iowa, it would be a stunning change of fortune and could restore credibility to his campaign.  With conservatives despairing at the prospect of a Gingrich-Romney contest, Perry could steal a march on the Right and find himself very much back in the mix — assuming that Ron Paul doesn’t beat him to it.

Christiane Amanpour out as host of “This Week”? Update: Stephanopoulos in?

As with any dull, lifeless marriage, it’s probably better that this one ends than that they stay together out of obligation.

I want to try an idea out on you, but really think it over before you say no. Okay?

“This Week with Chelsea Clinton.”

    Christiane Amanpour is preparing to leave as the anchor of “This Week,” the Sunday morning news program on ABC, two people with knowledge of her plans said Tuesday…

    Rumors about Ms. Amanpour’s status on “This Week” have swirled for months, and were given more oxygen last Sunday when The New York Post said that ABC News executives were “mulling who might replace” her. ABC did not deny the newspaper’s report…

    At the time she joined ABC, she said she would “focus on the intractable convergence of domestic and foreign policy.” Arguably her biggest scoop on ABC came last February when she interviewed then-Egyptian president Hosni Mubarak shortly before he stepped down.

    Ms. Amanpour’s tenure on “This Week” coincided with a decline in ABC’s competitive position on Sunday mornings.

Here’s the Post item from Friday alleging that neither side was thrilled with the other and that Amanpour might be angling to go back to the foreign affairs beat at CNN, which makes sense. If you were a journo who’d made your rep in international news, what would you rather be doing these days: Covering Iran’s nuclear progress, Syria’s civil war, and Egypt’s new Islamist government or refereeing ideological slapfights between George Will and Paul Krugman?

Like everyone else in America, I’ve never understood why ABC tapped someone with her resume for a political talk show. The idea, I guess, was to add a foreign-affairs dimension to Sunday morning yakfests, but that’s kind of like hiring a business reporter to anchor SportsCenter. Sure, there’s some subject-matter overlap, but nobody’s watching SC for a panel discussion on revenue sharing or the salary cap. And even if a crisis overseas blows up and dominates the U.S. news cycle, what special insight is Amanpour supposedly bringing to “This Week” by dint of her experience as a correspondent? The Mubarak interview was a nice “get” but (a) it was Barbara Walters, not Amanpour, whom Assad turned to for ABC’s latest big “get,” and (b) if it’s Amanpour’s contacts abroad that are prized by ABC, they should have put her in the field rather than behind a desk in D.C. By making her anchor, they were promising especially penetrating discussions of foreign affairs from week to week. Does anyone think they delivered?

Exit question: Amanpour’s loss is Jake Tapper’s gain, right? He’s delivered for them before, you know.

Oh my: Ron Paul within one point of Gingrich in Iowa?

posted at 3:56 pm on December 13, 2011 by Allahpundit

Hey now. I was writing “Could Ron Paul seriously win Iowa?” posts before writing “Could Ron Paul seriously win Iowa?” posts was cool.

    There has been some major movement in the Republican Presidential race in Iowa over the last week, with what was a 9 point lead for Newt Gingrich now all the way down to a single point. Gingrich is at 22% to 21% for Paul with Mitt Romney at 16%, Michele Bachmann at 11%, Rick Perry at 9%, Rick Santorum at 8%, Jon Huntsman at 5%, and Gary Johnson at 1%.

    Gingrich has dropped 5 points in the last week and he’s also seen a significant decline in his favorability numbers. Last week he was at +31 (62/31) and he’s now dropped 19 points to +12 (52/40). The attacks on him appear to be taking a heavy toll- his support with Tea Party voters has declined from 35% to 24%.

    Paul meanwhile has seen a big increase in his popularity from +14 (52/38) to +30 (61/31). There are a lot of parallels between Paul’s strength in Iowa and Barack Obama’s in 2008- he’s doing well with new voters, young voters, and non-Republican voters…

Simple question: What’s Paul’s ceiling in Iowa? A friend on Twitter was arguing earlier that it’s 20 percent, which is borne out by the polls — so far. If he’s right then Paul can’t win. But … what if Paul’s ceiling is actually 30 percent? Note that his favorables are trending upwards while Newt’s are sinking under the weight of renewed scrutiny of his various conservative heresies. If you’re an Iowan who’s unhappy with the “electable” candidates — Romney for being too opportunistic, Gingrich for flirting too often with activist government, Perry for seeming too darned hapless — then Paul’s an obvious choice for your “none of the above” protest vote. So obvious, in fact, that both Glenn Beck and Joe Scarborough are threatening to back him as a third-party candidate if Gingrich is the nominee. (An interesting footnote in the PPP data: Voters split equally on whether their view of the GOP establishment is favorable or unfavorable, and among the latter group Paul leads by double digits at 34 percent.) If he can pull 10 percent from voters like that on top of the 20 percent who make up his base, then his chances at an upset improve dramatically. And don’t forget, not only is Paul’s base famously enthusiastic and guaranteed to turn out, he’s one of the best organized candidates in Iowa this time. He might be able to get leaners to come out and caucus come rain or shine. Can Gingrich do the same?

I’ll bet Romney’s kicking himself now for not having abandoned Iowa early on. If he had done that, he could have sent his supporters out to caucus for Paul, thereby detonating Newt’s chances; if he tried that now, having competed in earnest in the state, the headlines would be all about Romney’s shockingly poor finish in Iowa, which would actually help Gingrich in New Hampshire even if he finished second to Paul in the caucuses. (On the other hand, per Rasmussen, Paul’s just four points back of Gingrich for second place in New Hampshire too.) Two exit questions for you, then. One: As chances of a Paul upset grow, will Iowa’s Republican leaders swing behind Newt or Mitt? They want the caucuses to remain relevant to choosing the eventual nominee, and if Paul wins, that’ll be two elections in a row where the Iowa winner realistically had no chance. Two: Could a Paul victory achieve a real “none of the above” outcome for the nomination? A brokered convention is unlikely – but, as Sean Trende explains, not impossible if Paul fares well.

    Caucus states are also concentrated in the Mountain West, where his brand of Republicanism holds greater appeal. They’re also front-loaded, meaning that (a) his supporters will be less likely to have been swayed by the “can’t win” argument and (b) the more “establishment” Republican candidates are likely to split the non-Paul votes.

    Overall, 486 delegates will be awarded in caucus states. If Paul picks off a sizable number of these delegates, say a quarter of them, and two other GOP candidates battle to a draw, there might not be a nominee by the end of June. This type of fight could carry over to the convention, since Paul is pretty feisty and is probably the least likely candidate out there to be “bought off” with a Cabinet position or speaking slot.

    If, say, Perry and Gingrich are knotted up with about 1,050 delegates each, and Paul holds the remaining 200 and refuses to budge, you could end up with a deadlocked convention that eventually turns to a dark-horse candidate.

Ron Paul winning Iowa just might mean the GOP nominating Ryan, Christie, or Daniels. Second look at Ron Paul winning Iowa?

Be prepared: Another open registration day coming tomorrow!

After all the fun we had last week in holding our open registration, who wouldn’t want to relive it the very next week?  Our courageous staff support at Townhall has been medically cleared for duty, our systems have been fortified, and mainly we’re all a bunch of masochists.  What could go wrong?

So tomorrow, we will once again hold an open registration for new commenters here at Hot Air, between 9 am and 4 pm ET, when our staff support is on duty to assist in the process.  Just like last week, we will approve new registrants, not process amnesty requests for previously-banned commenters. We’ll have instructions in tomorrow’s post on how this works and what to expect — so please make sure you read those before peppering us with questions we have already answered.

Why hold another right now?  First, we think we fixed the problems that plagued us last week, so it should go much smoother.  Also, we want to add as many commenters as we can in order to increase participation in a new feature we will launch here and at our sister site Townhall — the Hot Air/Townhall Republican primary!  (They’re probably calling it the Townhall/Hot Air Republican primary over there, but what do they know?)  Only registered commenters will be able to vote — so make sure you register tomorrow!

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Sam Rainsy Continues US Case Against Hun Sen (Cambodia news in Khmer)

Open thread: Republican debate in Ames

posted at 8:10 pm on August 11, 2011 by Ed Morrissey
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Tonight, the Republican candidates for the presidential nomination — most of them, anyway — square off for a televised debate in Ames, Iowa, from the Stephens Auditorium at Iowa State University. I will be in the media “spin room,” along with our partner in blogging Tina Korbe and our Townhall brother Guy Benson. The debate starts at 9 pm ET/8 pm local time here in Iowa, and Fox News Channel’s Bret Baier will moderate the event. We’re looking forward to a lively debate, and I’d expect some elbow throwing and sharp barbs between the contenders, along with a few shots at the absent Rick Perry.

Since live blogging has become a little passé in the age of Twitter (is it possible to feel like an old blogger? Yes, we can!), our friends at Townhall came up with this widget that will track our tweets, along with our Townhall colleagues Katie Pavlich, Erika Johnsen, and the indispensable Allahpundit.  Be sure to follow along, and perhaps open this post in two tabs — one to follow the Twitter feeds, and one for comment posting.

Tina, Guy, and I will capture some of the spin in the room after the show, so be sure to stay right here at Hot Air after the debate ….

Update (AP): While we wait, here’s Larry Sabato’s debate preview. Note this passage well:

    The tension between Pawlenty and Bachmann will be even more fun to watch. T-Paw is in a corner on this one. If he wouldn’t smack a man last time, can he now do it to a woman — one who Republicans think was already wronged this week by Newsweek’s unattractive cover photo?

Pawlenty’s the only one onstage who can potentially make or break his campaign tonight. Huntsman needs to do well to make a good impression with Republicans who are seeing him for the first time, but Huntsman’s not competing in Ames or in Iowa more broadly. He can afford a mediocre performance. T-Paw can’t, and if he whiffs again when pressed to criticize his opponents to their faces, he’ll be a punchline before the night is out. I sure hope he’s ready if one of the moderators asks who he has in mind in his stump speech when he dumps on nameless “bobbleheads” among his competitors. It’s painfully clear that he means Bachmann, but who knows whether he has the stones to denigrate her when she’s standing right next to him. And if he does, he’d better hit Romney hard too or else he’ll get hammered tomorrow for precisely the reason Sabato gives. Long story short: Pawlenty needs to be throwing chairs tonight. He needs to walk in there in a cape, to the tune of “Pomp and Circumstance,” and be the Macho Man he keeps claiming he is. You’re an old hockey player, Tim, right? Drop the gloves.

http://hotair.com/archives/2011/08/11/open-thread-republican-debate-in-ames/

“Frustrated” Obama rips Congress: It’s time for certain people to put country over party

posted at 5:29 pm on August 11, 2011 by Allahpundit
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An actual quote from today’s remarks: “There are some in Congress right now who would rather see their opponents lose than see America win.” To which Steve Hayes, irked by the sight of yet another straw man being torched, replies, “Who are they?” The answer, I can only assume, is congressional progressives: They’re the ones who refuse to budge on the ruinous Medicare spending that’s rocketing the country towards fiscal collapse, as doing so would forfeit their party’s big campaign issue next year. But in case The One’s referring to tea-party congressmen (as he surely is), what was amazing about the “don’t raise the ceiling” crowd during the debt debate is that they were prepared to absorb a ferocious backlash against their own party in the name of doing something significant, i.e. Cut Cap and Balance, to solve America’s debt crisis. Time and again they were told that the GOP would bear the brunt of public anger if we didn’t make a deal, but they preferred that outcome to a weak compromise because at least there’d be important reform as a result. I know Democrats cherish their belief that the right acts only out of personal pique, not principle — it’s all part of the delegitimization game — but the caucus really was trying to put country first in that debate. Their means and ends simply differ from Obama’s; the fact that The One interprets that the way he does says more about him than it does about them, but Democrats have been begging him to be “bolder,” especially in attacking the tea party, so presumably they’ll be happy today.

The two key sections in the clip below run from 5:30 to 7:15 and 11:00 to 13:00. The grand absurdity of this critique, of course, is that every move this guy has made in recent memory, from yanking troops out of Afghanistan by next year to offering a budget so timid that it received not a single vote in the Senate to deliberately refusing to offer his own deficit-reduction plan during the debt-ceiling debate, is geared towards maximizing his odds of reelection. (It’s, er, not working.) The very last person who should be lecturing others about putting the country ahead of a campaign is the Perpetual Campaigner. But he can really sell the above-the-fray crap, can’t he? Exit question: Wasn’t putting country over party actually the campaign theme of Obama’s last opponent? Wouldn’t be the first time he’s borrowed a slogan from a Republican.

http://hotair.com/archives/2011/08/11/frustrated-obama-rips-congress-its-time-for-certain-people-to-put-country-over-party/

Fox News exclusive: Perry aides confirm that he’s running for president

posted at 4:05 pm on August 11, 2011 by Allahpundit
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He all but confirmed it himself in his interview with Halperin, but this is the first hard “yes” to come out of his camp after weeks and weeks and weeks of teasing. It’s newsworthy if only for that reason, although I’m intrigued by the timing of the leak. Why not wait another 48 hours and let him end the suspense himself on Saturday? Are they a tiny bit spooked by Palin’s arrival in Iowa, maybe, and looking to preempt that with solid news about him running? Or is this all about ensuring that his name is mentioned at the debate tonight?

    Texas Gov. Rick Perry will make “a definitive announcement that he is in the 2012 race for the presidency Saturday,” aides told Fox News.

    The language is significant. For several days the Perry camp has said he would signal his intentions and announce later.

    “This is it,” the sources explain. No exploratory committee, no more deliberation.

Speaking of the Halperin interview, Ace is totally right that Perry made a bad mistake in gossiping about the conversation he had with Latvia’s prime minister about Obama. It humiliates a sitting president who, like it or not, is in charge of foreign affairs for another 15 months and it humiliates the Latvian PM by putting him on the spot over what was, almost certainly, supposed to be a confidential chat. I think this is more a case of Perry being absentminded than deliberately setting out to breach that confidence, but he can’t let it happen again.

Via the Daily Caller, here’s Joe Scarborough dumping on him this morning for praying a bit more publicly than he’d like. Meanwhile, Tom Tancredo’s tearing Perry to shreds in Politico for being much softer on amnesty than he’d like. He’s too far right for the centrists and too far towards the center for the right — not a bad place to be for a guy trying to triangulate between Romney and Bachmann. Besides, if he and Romney do end up in a two-man race, does anyone think Mitt will be taken seriously if he tries to beat Perry by becoming some sort of table-pounding border enforcer? C’mon.

Update: More confirmation. He’s in.

Update: At Townhall, Dwayne Horner has more details:

    Stories started surfacing earlier this week saying that Perry, the longest serving chief executive in Texas history, would use the conservative gathering to remove all speculation about a run for the White House. Sources revealed to Townhall yesterday that the Governor’s children, Griffin and Sydney, have been told to clear their schedules starting Friday so they could be “with their father at this special time.”…

    With the confirmation that Perry will indeed be a candidate, speculation is that a formal announcement is in the works during Labor Day weekend in either Austin or on the Texas A&M campus.

http://hotair.com/archives/2011/08/11/fox-news-exclusive-perry-aides-confirm-that-hes-running-for-president/

CNN: Perry enters race in virtual tie with Romney, Bachmann fades

posted at 10:05 am on August 11, 2011 by Ed Morrissey
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Texas Governor Rick Perry will upend the Republican presidential primary with his entry this weekend, CNN’s latest national poll shows. He starts off in a virtual tie with Mitt Romney, 17/15, with his nearest competitors at 12%. Perhaps most surprisingly, Michele Bachmann isn’t among them — and her support gets cut almost in half with Perry’s candidacy:

According to a CNN/ORC International poll, 15 percent of Republicans and independents who lean towards the GOP pick Perry as their first choice for their party’s nomination, just two points behind former Massachusetts Gov. Mitt Romney, who’s making his second bid for the White House. Romney’s two point margin over Perry is within the survey’s sampling error.

The poll’s Thursday release comes two days before Perry gives a speech at a major conservative gathering in South Carolina where his staff has indicated he will make his intentions for a presidential run clear. Later in the day Perry travels to New Hampshire to meet with GOP lawmakers, activists, and voters. Perry’s travels Saturday come as the rest of the political spotlight will be shining on Iowa, for a crucial presidential straw poll in Ames. Perry heads to Iowa Sunday to speak at a Republican party gathering, which means he will visit three of the crucial early voting primary and caucus states this weekend.

The survey indicates that former New York City Mayor Rudy Giuliani, former Alaska Gov. Sarah Palin, and Rep. Ron Paul of Texas, who is making his third bid for the White House, are at 12 percent apiece. While both Giuliani, who ran for the presidency four years ago, and Palin, the Republican vice presidential nominee in 2008, have flirted with bids, neither has taken concrete steps towards launching a campaign.

Three weeks ago, Perry scored 14% but Giuliani, Palin, and Bachmann all scored 13% or 12%. Now Bachmann has dropped to 7%, a fall of five points and the biggest decline in the field for the period. Ron Paul has picked up four points to surpass her and join Giuliani and Palin in a three-way tie for third place.

Bachmann isn’t the only candidate trending downward, but the rest are in the second tier. Herman Cain dropped two points to 4%, while Tim Pawlenty dropped one to come in at 2%. Both of these candidates need breakout performances in Iowa, which was well known before this week. If CNN’s series is not an outlier, Bachmann may need one as well, now that Perry has come closer to tossing his hat in the ring. She has been wowing crowds in Iowa this week in advance of the debate and straw poll, so she is doing all she can on the ground, but that may not be enough — at least not this week.

Time Magazine’s Mark Halperin interviewed Perry this week about his plans:





A highlight from the transcript:

Q: You’ve talked about how all of the social issues are important and this election is going to be about what the voters care most about: economy and jobs. Is it your hope, if you become a candidate, that even voters who disagree with you on social issues will find your record and argument on jobs so compelling that they vote for you even though they did disagree with you?

A: Well, I’m pretty sure there has never been a candidate [where] all the people agree with his or her positions on the issues. And there are single-issue voters, and I understand that. I respect that. I’ve run three times in Texas and I would suggest to you, Texas is somewhat of a microcosm of the rest of the country, particularly in this first decade of the 21st century. We are very, very cosmopolitan, if you will, very urban, but we have our rural areas. We have an incredible diversity of people [who] live in this state. This is not the Texas of my father. It is a very diverse state. Running for the governorship of the state of Texas, I recognized all the diversity of thought.
So, what’s the most important thing that’s facing this country? It’s getting this economy back. I am a pro-business governor. I will be a pro-business President if this does, in fact, ensue and I’m blessed to be elected President of the United States—unabashedly [so] because the fact of the matter is, there’s nothing more important than having an environment created by government that allows for the private sector to risk its capital to know that they have a good chance of having a return on the investment. Because at that particular point in time, the men and women who are out of work today can be back employed. They can take care of their family. They can do the things they desire in their lives. And without that strong economy, America can’t be strong militarily. We can’t have, frankly a presence in the world that we need to have. It all goes back to having an economy that people are comfortable with—they can risk their capital and they’ll have a return on the investment. We don’t have that today.

Q: There are people who’ve looked up—even though you’re not yet a candidate—your record and your endorsement of Mayor Giuliani in the last campaign, some of the positions you’ve taken on immigration, etcetera, and they say Rick Perry is not actually as conservative as he says. What do you say to those people?

A: Well, you know, I stand on my record. I thought Mayor Giuliani did a wonderful job of managing a city. He was very strong militarily. He was as strong on crime as any big city Mayor has ever been. He and I were 180 degrees on social issues, but he would put strict constructionists on the Supreme Court, which dealt with those social issues. I happen to be comfortable that I was making the right decisions and that as President, when it comes to those social issues, it’s very important to have that strict constructionist view of who you put on the Supreme Court. Because they’d look at the constitution and say, you know what, that issue dealing with abortion is not in the constitution. We will put it back to the states. Now if the states want to pass an amendment and three quarters of the states want to pass an amendment to make this be a change of our United States constitution, then just follow that process. And I’m a big believer that that’s how our country should work.

Q: So if you got in, would you be the most conservative candidate in the race? Or as conservative as everybody else?

A: Yeah I don’t think there’s any doubt about that. But again, we go back to what’s the most important issue here? I mean if somebody wants to go back and find, oh here’s a little spot right here—you know, I was a democrat at one time in my life. I was 25 years old before I think I ever met a person who would admit being a Republican. So the key is, I’ve got a record. And that record, particularly when it comes to the most important issues in this campaign, which is creating the climate of America that gives incentives to job creators to risk their capital and create jobs for our citizens, I will put that up against anybody who’s running and particularly against this President we have today, whose jobs record is abysma

Obama prepares for career as landlord

posted at 1:25 pm on August 11, 2011 by Jazz Shaw
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It’s an idea so beautiful in its simplicity and so perfectly targeted to cure one of our biggest national headaches that many readers will be slapping their foreheads in one of those, “I could have had a V-8″ moments. The housing market is still in the tank and the government has been forced to foreclose on countless properties which now sit vacant, generating no tax revenue. The nation’s coffers are running dry and we have to tackle our debt problem. But nobody wants to raise taxes. What to do?

Why, you kill two birds with one stone, of course! We’ll let the government go into the property rental business!

    The Obama administration may turn thousands of government-owned foreclosures into rental properties to help boost falling home prices.

    The Federal Housing Finance Agency said Wednesday it is seeking input from investors on how to rent homes owned by government-controlled mortgage companies Fannie Mae and Freddie Mac and the Federal Housing Administration.

    At the end of last month, the government owned roughly 248,000 foreclosed homes, officials said. About 70,000 of those are listed for sale. But officials expect the number of foreclosures to soar in the coming months.

What could possibly go wrong? Over at Pajamas Media, Bryan Preston suspects that even in such an obviously brilliant scheme, there might be a few wrinkles.

    [N]ot to put too fine a point on things, renting your home from the government raises all kinds of liberty questions. If they don’t like your politics, can they find a way to evict you? Can they tell you what to do (more than the government already does) in the home you’re renting from Uncle Sam? With a president hitting 51% disapproval, an IRS that’s become notorious for political audits and federal law enforcement agencies known lately more for gunrunning than crime stopping, that’s not an idle question. Would the feds allow renters to own firearms in these government homes? The majority of renters between now and 2012 are likely to be people who don’t like their landlord, but the landlord has, shall we say, serious firepower superiority. There’s a great deal to ponder here.

It’s difficult to imagine what a mess this would wind up being in court, if only on the constitutional authority questions. Preston offers an alternate suggestion of scrapping Fannie and Freddie entirely and spinning off all of those properties at open, public auctions. Granted, that would have a sudden, if short term negative impact on the real estate market, but it could conceivably hasten the process of allowing it to find its natural bottom and begin rebuilding from there in an organic fashion.

But who knows? If we let Washington handle it as proposed, there would probably be all sorts of exemptions and set-asides built into the system and you might wind up renting a mansion for fifty bucks a month. And if the house is built well enough it will provide you with a place to hide when the zombie apocalypse begins.

Cash for Bunkers?

Consumer Sentiment Curbs Appeal of Aussie

Australian dollarThe Australian dollar resumed its movement down after the yesterday’s gains as consumer sentiment declined this month, reducing attractiveness of the nation’s currency.

The Westpac-Melbourne Institute Consumer Sentiment index fell 3.5 percent in August from July. This declined followed the drop by 8.3 percent in July. The Aussie (the nickname of the Australian currency) also weakened as the pledge of the Federal Reserve to keep interest rates stable hasn’t reduced pessimism among Forex traders.

AUD/USD retreated from 1.0353 to 1.0343 as of 11:51 GMT after jumping to 1.0414 today. AUD/JPY fell from 79.66 to 79.15, following the advance to 80.34.

If you have any questions, comments or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.

Earlier News About the Australian Dollar:

Australian Dollar Attempts Stop Decline, Fails (2011-08-09)

Eighth Session of Suffering for Aussie (2011-08-08)

AUD Down on Economic Outlook Revision (2011-08-05)

Australian Dollar Continues Its Correction on Weak Retail Sales (2011-08-03)

AUD Surges Against Everything on Higher Inflation Numbers (2011-07-27)

This entry was posted on TopForexNews on Wednesday, August 10th, 2011 at 11:51 am and is filed under Australian Dollar. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

Impact of BoJ Intervention on Yen Wanes

Japanese yenThe Japanese yen jumped against all other most-traded currencies today as traders fled to safety of the yen, fearing the financial problems of the US and Europe.

The Japanese policy makers signaled that they may take steps to curb gains of the currency. In fact, the Bank of Japan already intervened on August 4, but the impact of the move almost waned at present. This situation isn’t unlike the one in Switzerland, where the central bank also fights with appreciation of the nation’s currency and also losing this battle.

USD/JPY fell from 77.74 to 77.04 as of 9:09 GMT today. EUR/JPY went down from 110.23 to 109.74 while it reached the low of 109.09 during the day.

If you have any questions, comments or opinions regarding the Japanese Yen, feel free to post them using the commentary form below.

Earlier News About the Japanese Yen:

    Yen Slumps on BoJ Intervention (2011-08-04)
    Yen Gains on Greece & US Debt Problems (2011-07-28)
    EU Summit Eases Need for Safety, Yen Drops (2011-07-22)
    Second Week of Gains for Yen, Will BOJ Intervene? (2011-07-16)
    Yen Declines as Chinese Economy Grows (2011-07-13)


This entry was posted on TopForexNews on Tuesday, August 9th, 2011 at 9:10 am and is filed under Japanese Yen. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

Fed statement a vote of no confidence in economy through 2013?

posted at 10:05 am on August 10, 2011 by Ed Morrissey
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The current historically-loose monetary policy will continue, according to a Federal Reserve statement last night — for two more years.  The Fed normally doesn’t offer projections with such unambiguously lengthy timelines, preferring to keep its options open.  These, however, are not normal times — nor do we have normal leadership:

    The Federal Reserve announced on Tuesday that it plans to hold the benchmark interest rate at “exceptionally low levels” through at least mid-2013, breaking from the central bank’s usual less precise timelines.

    The action — which sent the Dow Jones Industrial Average swinging wildly up and down — signals the Federal Open Market Committee sees the path to economic recovery as longer and slower than anticipated even a few months ago.

    With the Fed’s decision, the target interest rate will stay flat at between 0 and 0.25 percent for close to the next two years, if not longer.

This appears to be the Fed’s alternative to another round of quantitative easing, a currency-devaluing exercise that remains the only real tool left in the Fed’s bag these days.  So far, the pledge seems to have helped calm global markets, at least for now:

    A pledge by the Federal Reserve to keep extremely low interest rates for another couple of years has calmed investors’ jitters, sending stock markets around the world higher Wednesday.

    The Fed’s surprise announcement Tuesday that it would likely keep its Fed funds rate at near zero percent through 2013 to help the ailing U.S. economy helped Wall Street surge late in the session — the Dow Jones industrial average rallied 6 percent just in the final hour of trading, one of the biggest turnarounds ever seen.

    That continued into the Asian and European trading sessions, although traders remained nervous after the market turmoil of recent weeks, which has sent many global markets officially intobear market territory — falling 20 percent from recent peaks.

This prompts the question, though, of what the Fed does next week or next month if markets get jittery again.  A QE3 won’t make investors any happier, and the Fed has nothing else to do now that they have made a two-year commitment on monetary policy.  Adding a third year in September or October, for instance, won’t have much impact on investment in the short term.

The rather unprecedented move should have people wondering why the Fed feels it has to commit to a loose-money policy for so long.  It was almost certain that they wouldn’t tighten the money supply anyway, not with inflation risks low and the global economy on the cusp of a recession.  Any move to a tighter policy would only come after a period of torrid growth in order to hedge against inflation damaging a full recovery, and that’s obviously a long way off.

So why make this policy so explicit in terms of length?  To calm markets, to be sure, but a six-month statement would have been just as effective.  The only reason to commit to a two-year policy of ultra-loose money is because the Fed doesn’t see any real prospects for economic growth through mid-2013.  They see no real need to have the option of tightening the money supply.  Economic conditions won’t change enough for the Fed to contemplate a change of policy, or so Ben Bernanke and the Fed board appear to say.

That to me sounds like a vote of no-confidence in the American economy, and in American economic leadership.  And, like the S&P downgrade that preceded it, it’s completely understandable, too.

Breaking: Reid appoints John Kerry, Patty Murray, and Max Baucus to Super Committee

posted at 6:05 pm on August 9, 2011 by Allahpundit
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That’s precisely what we need to reach a grand bargain. Hard-left dial tone Patty Murray and a guy who spent the past Sunday muttering in front of TV cameras about a “tea-party downgrade.” Bonus fun fact about Murray via Amanda Carpenter: She’s the head of the DSCC this election cycle, which means there ain’t no way no how no chance she’s signing off on any deal that involves even minor Medicare reform.

Not sure what to make of Baucus, though.

    Murray is expected to co-chair the committee, officially named the Joint Select Committee on Deficit Reduction, along with a still unnamed House Republican. A spokesman for Reid did not respond to a request for comment.

    Reid’s decision to tap Murray will likely be met with scrutiny, as she is also chairing the Democratic Senatorial Campaign Committee for the 2012 election cycle. But she is also a member of leadership, a senior member of the Budget Committee, and a woman on what is likely to be a male-dominated committee.

    Baucus is chairman of the powerful Senate Finance Committee with jurisdiction over many areas, including entitlement programs, that the committee is expected to examine. Kerry, meanwhile, was selected for his stature and Senate tenure.

None of the three were members of the Gang of Six, but Baucus was part of the Biden deficit group that Cantor walked away from over taxes. Could he potentially be the seventh vote for a deal on the Super Committee? He comes from a red state, he’s an institution in the Senate, and he’s not up for reelection until 2014. He’s as insulated from a tough vote as one can be. He’s also, as noted in the quote, chairman of the Finance Committee, so if he blessed a deal, that would give it added credibility in the Senate. And he’s been reasonably good on taxes, so he might side with Republicans on tax reform. The bad news? He duly wet himself over Paul Ryan’s budget and he’s earned some fans at AARP for supporting “doctor fix,” which contributes mightily to Medicare continuously running over budget. He’s probably not signing off on any serious entitlement reform, in other words, although if the GOP can come up with some revenues via tax reform, that might encourage him to join them in a modest first step. He floated that idea himself, in fact, after Biden’s group melted down, proposing new Medicare cuts in return for new revenues. Then again, Baucus was on Obama’s Deficit Commission and ended up voting no on the final plan. Of course, so did Paul Ryan.

I’ll leave you with this thought, in case you’re under the mistaken impression that anything will be accomplished by this process:

    Congress may undermine the deal that raised the U.S. debt ceiling by failing to agree on a plan to curb the deficit and then softening the impact of automatic spending cuts that would kick in to achieve the budget targets.

    That’s the view of five former directors of the Congressional Budget Office…

    While the cuts are supposed to be automatic, Congress can delay or override them if they prove too painful — defense spending would be reduced by 9.1 percent over a decade while non-defense programs would be cut 7.9 percent. That’s what lawmakers did with the 1985 Gramm-Rudman-Hollings Balanced Budget Act, the template for the trigger.

Update: Weigel sees a new “the Democrats caved again!” narrative brewing on the left over Baucus. “So the Democrats will have one of their compromisers on the committee. Unless the GOP puts up one of its compromisers — a neo-Gang of Sixer, or someone like Bob Corker — the Baucus move alone means a committee that leans right.”

Roseanne Barr: Palin’s stealing my act

posted at 12:50 pm on August 5, 2011 by Tina Korbe
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Looks like somebody is jealous. Former sitcom star Roseanne Barr, who has never betrayed any political ambition beyond supporting President Barack Obama, now sarcastically says she wants to run for president — and cites former Alaska Gov. Sarah Palin as her inspiration:

    “That’s kind of what got me to thinking that I too should run for president if she can,” Barr told host Jay Leno [last night on "The Tonight Show"]. “I wanted to edge her out because I feel like she’s stealing my act anyway.”

    Barr said Palin, who is flirting with a White House bid, was also her motivation for appearing in a reality show. Her Lifetime show “Roseanne’s Nuts,” premiered a few weeks ago and follows the former sitcom star running a Hawaiian nut farm.

    Barr, a former supporter of President Barack Obama, claimed she is “totally serious” about a bid and said she will run as a candidate from the Green Tea Party. No taxes, the forgiveness of student loans and all debts and the use of vegetables instead of money will be the cornerstones of her campaign, she said.

Barr must not have gotten the memo that Palin hasn’t yet declared presidential candidacy (and might not at all). Barr also said she assumes all you have to do to be president is “show up and give a speech.” No, Roseanne, that’s what you have to do to be a sitcom star. Obama is Exhibit A: Charisma and eloquence do not a competent president make.

All of which reminds me: Why, in all of his talk of taxing the rich, does Obama never add “Hollywood entertainers” to his oh-so-redundant list of “corporate jet owners, hedge fund managers and oil company executives”? Seems to me they could pitch in more than a few dimes to reduce the debt and deficit.

Obama: Hey, my “singular focus” is on jobs!

posted at 12:10 pm on August 5, 2011 by Ed Morrissey
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Barack Obama has given a response to the jobs report this morning while speaking at the Washington Navy Yard.  I’ll bet most people have already guessed how the President sought to reassure Americans that “things will get better“:

    “We are going to get through this. Things will get better. We’re going to get there together,” Obama told a crowd of veterans at the Washington Navy Yard Friday, where he was speaking about lowering unemployment among the nation’s veterans. Neither he nor any member of the administration commented after the Dow plunged over 500 points Thursday, and Obama avoided addressing the market crash directly.

    “There is no doubt this has been a tumultuous year,” said Obama. “My singular focus is the American people. Getting the unemployed back on the job.”

First, it’s interesting that Obama didn’t attempt to sell the jobs report this morning as good news.  Wall Street wasn’t impressed by it; after yesterday’s selloff, the Dow Jones was off another 150 points by noon today.  European stocks had a 3-year drubbing this week as well.

But even Obama’s allies aren’t buying the “singular focus” line any longer. Arianna Huffington told Lawrence O’Donnell earlier this week that no one believes Obama when he claims that jobs are his highest priority, but rather think it’s one job in particular, emphasis mine:

But the point is that the most important number going into 2012 is going to be the unemployment number. And there is absolutely no prospect at the moment that would make us believe that unemployment number is going to be below nine percent. Now that is really the greatest fear for the White House. And of course Mitt Romney again and again is talking about the failure of the President to produce jobs, and he doesn’t have to tell us how he would have done it. He just has to point out to that failure. And when the President again and again talks about how, I mean, I went through and looked since 2009 how many times he has said, “Jobs priority number one,” “The sustained focus of this administration,” “The relentless focus of this administration,” “We’re pivoting to jobs.” Nobody believes it any more.

For all of this focus, Obama has yet to put forward his own plan to promote massive job growth, or any kind of private-sector growth at all. If that sounds familiar, it should; Obama failed to put forward any specific plan to deal with deficit reduction and the debt ceiling, and the only specific demand he made — tax hikes — would have stunted job growth. In fact, he’s still talking about tax hikes, which is a highly strange way to claim that job creation is one’s “singular focus.”

As long as Obama’s actual “singular” focus remains on expanding regulation and raising taxes, things won’t get better until he leaves office … hopefully in 2013.

Bachmann: President created twice as many donors as jobs in the second quarter

posted at 11:30 am on August 5, 2011 by Tina Korbe
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This morning’s predictably dejecting jobs report provided the GOP presidential candidates with an apt opportunity to cast the president in an unflattering light — and to contrast his approach with what their own would be.

Memorably, former Massachusetts Gov. Mitt Romney framed his statement in a way that leaves voters displeased with the economy little choice but to vote Obama out of office.

“When you see what this president has done to the economy in just three years, you know why America doesn’t want to find out what he can do in eight,” former Massachusetts Gov. Mitt Romney said.

Importantly, Romney is not the only person who has said Obama should be a one-term president if the economy doesn’t turn around by the end of his first term. Who was it who also said that again? Oh, yes, Obama himself.

Michele Bachmann noted a fact that’s telling about Obama’s priorities and forwarded her own solutions, as well.

“The President created twice as many donors for his campaign as he created jobs in the second quarter,” she said in a statement. “This week the President announced that he would again pivot to focus his attention on jobs. We can only hope he will pivot away from his failed economic policies that have killed growth and put millions of Americans out of work. What the markets want and what the country needs is a fundamental restructuring in the way Washington spends taxpayers dollars that reins in unprecedented spending, gets our debt under control and encourages pro-growth economic policies.”

Former Minnesota Gov. Tim Pawlenty called out the president’s lack of plan to good effect.

“Today’s dismal jobs report is a far cry from the hope and change that President Obama promised on the campaign trail,” Pawlenty said. “Since the president took office, unemployment has risen 17%, the federal debt has increased 37% and gas prices have doubled.  In the last week, the stock market suffered its worst day in years, economic growth was revised down and consumer confidence dropped.  Despite these clear and abundant signs that our economy is floundering, President Obama has still failed to deliver a concrete plan to create jobs and promote growth.”

Pawlenty also emphasized that he is the only candidate so far to have put forward a concrete plan for job creation and economic growth.

Like Bachmann, former Utah Gov. Jon Huntsman observed a priority of the president’s that has distracted from jobs growth.

“When President Obama should have been focused on creating jobs, he focused on a government-mandated health care system that the American people didn’t ask for and can’t afford,” Huntsman said. “What we can’t afford now is to waste any more time. … This country will never realize its true economic potential until we enact tax cuts, implement regulatory reform and move toward energy independence.”

The websites of former Pennsylvania Sen. Rick Santorum, Rep. Ron Paul (R-Tex.), Herman Cain, former Speaker of the House Newt Gingrich and Rep. Thaddeus McCotter (R-Mich.) didn’t feature ready reactions to the jobs report (at least at the time I was writing).

How about a government shutdown to make those Tea Partiers fear Obama?

posted at 10:45 am on August 5, 2011 by Ed Morrissey
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If you want an example of how out of touch media commentators can be with American politics, look no farther than the Washington Post’s Jonathan Capehart.  Barack Obama’s cave on tax hikes in the debt deal clearly annoyed Capehart, who criticized the President for his lack of “aggressiveness” that resulted in a deal that doesn’t reflect “the will of the people” — at least as Capehart sees it.  Calling the Tea Party-backed Congressmen “carjackers,” Capehart called on Obama to be “Keyser Söze.”  But that’s not the only place where Capehart’s perspective departs from reality:

    If you’ve seen the brilliant movie “The Usual Suspects,” you know who this diabolical character is and what he did to gain mythical status. Suffice it to say that Söze so out-crazied the crazies that he became a person not to be messed with — a symbol of fear and grudging respect.

    In the coming fights over the next budget, unemployment benefits and payroll tax cuts, I want Obama to show the Republican Party in general and the Tea Party in particular that he isn’t afraid to out-crazy the crazies. If that means vetoing bills, taking the fight to individual districts, shutting down the government, so be it.

We’ve already seen this strategy play out twice.  Here in Minnesota, Gov. Mark Dayton reneged on his pledge not to shut down the government over his demand for tax hikes, refusing to negotiate a “lights on” bill with the Republican-controlled legislature to avoid the shutdown.  How did that work out for Dayton?  He rushed back to the capital to cut a deal without tax hikes when his own allies gave him a blast of disapproval in town-hall meetings around the state, while most Minnesotans barely noticed the difference.  The shutdown only hurt Dayton’s voter base of unions and the poor.  Instead of Keyser Söze, Dayton turned into Eric von Zipper.

Next, Harry Reid tried doing the same thing with the FAA.  Unfortunately for Reid, his ploy was rather obvious; he had failed to move an authorization bill in the Senate and hoped that the prospect of putting thousands of government bureaucrats out of work would embarrass conservatives.  After the media started grilling Reid on why he hadn’t done anything to move a Senate version of the bill, as well as realizing that putting bureaucrats out of work wasn’t exactly causing Tea Party activists to weep into their pillows at night, and especially after it became obvious that the system ran pretty well without them, Reid ended up quickly surrendering.  Instead of Keyser Söze, Reid turned into Jeffrey Goines.

If Capehart doesn’t realize that the Tea Party activists in Congress want to shut down large portions of the federal government, what has he been doing the last two years?  A partial government shutdown would please the Tea Party to no end.  The only people it would hurt will be Obama’s own constituencies, especially since the entitlement checks would still have to go out to recipients, as those are mandated by statute and not budgeted annually by Congress.  The biggest loser in an Obama-triggered shutdown would be Obama himself.

Maybe Capehart should spend some time talking with actual Tea Party activists before coming up with grand strategies like this.

Addendum: To answer Capehart’s question, Söze got the advantage over his competitors by murdering his own family, murdering all of his competitors afterward, and then disappearing.  I’m not sure what relation that has to American governance — or to carjackers, for that matter, since The Usual Suspects didn’t have any of either.  This analogy leaves a lot to be desired, including taste and the “civility” that Democrats spent the last six months demanding not just of Republican politicians but also conservative commentators.

Yen Slumps on BoJ Intervention

Japanese yenThe Japanese yen dropped heavily against everything on the Forex market today, following the currency intervention by the country’s central bank.

The yen declined most notably against the US dollar, demonstrating the biggest daily drop since October 2008. It also fell to the lowest rate against the euro since July 11 and reached the price minimum against the Great Britain pound since July 5.

The Bank of Japan followed the footsteps of the Swiss National Bank and intervened the currency market today, increasing the amounts of yen it purchases in order to hold down the currency appreciation:

    …to enhance monetary easing by increasing the total size of the Asset Purchase Program by about 10 trillion yen2 from about 40 trillion yen to about 50 trillion yen.

The market analysts believe that the success of this measure will depend on how persistent the country’s central bank will be. To keep the yen down, they’ll have to continue with similar measures. One-time event just won’t do it for something as bullish as the Japanese yen.

USD/JPY rose from 76.97 to 79.78 as of 12:37 GMT today, reaching as high as 80.23 (the maximum since July 12) earlier. EUR/JPY went up from 110.54 to 113.09. GBP/JPY advanced from 126.54 to 130.21 today.

If you have any questions, comments or opinions regarding the Japanese Yen, feel free to post them using the commentary form below.

Earlier News About the Japanese Yen:

    Yen Gains on Greece & US Debt Problems (2011-07-28)
    EU Summit Eases Need for Safety, Yen Drops (2011-07-22)
    Second Week of Gains for Yen, Will BOJ Intervene? (2011-07-16)
    Yen Declines as Chinese Economy Grows (2011-07-13)
    Growing China's Economy Saps Demand for Safety of Yen (2011-06-14)


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Carney: Yeah, taxpayers will fund the Obama Midwest Jobs Tour

posted at 11:30 am on August 4, 2011 by Ed Morrissey
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As I mentioned in the OOTD today, Barack Obama promised a new focus on jobs for about the 15th time in less than three years, shortly after the conclusion of the debt-ceiling deal. As part of that new focus, Obama plans a bus tour — an unusual mode of travel for an American President, but SOP for a presidential candidate working the crowds to bolster support. But when White House reporters quizzed press secretary Jay Carney about whether Obama or taxpayers would foot the bill for this whirlwind tour, Carney responded that “the air of cynicism is quite thick,” as CNS News reports:

    CNSNews.com asked Carney, “Is that a campaign event or a presidential event?

    Carney answered, “Negative. That is an official event.”

    CNSNews.com followed, “So it is being funded by taxpayers in battleground states?”

    Carney responded, “He’s the president of the United States.”

    Another reporter followed up about whether there was a political nature to the trip.

    “The air of cynicism is quite thick,” Carney shot back. “The idea that the president of the United States should not venture forth into the country is ridiculous.”

    The reporter said, “I didn’t say that.”

    Carney said, “No, but you implied it in your question. It is absolutely important for the president – whoever that person is, in the past or in the future – to get out and hear from people in different communities.”

Something’s getting thick, but it’s not the air of cynicism.  Presidents do make appearances throughout the country during their terms; it’s one of the perks of the office, and one reason why incumbent Presidents are so hard to beat in an election.  However, they don’t usually travel by bus.  They normally use Air Force One, which has a standard security profile as well as the capacity to allow a President to perform his job while away from the White House.  In order to accomplish this three-day bus tour of the Midwest, the taxpayers will have to foot the bill for re-inventing the wheel as well as the rest of the costs.

Last year, this wouldn’t have been as big an issue.  That’s because Obama hadn’t officially launched his re-election campaign.  The campaign raised $49 million for itself in the first quarter and another $38 million for the DNC.  Getting in a bus on a jobs tour sounds a lot like preparing the ground for later fundraisers more than a job-related duty.  This is the reason that most incumbents wait for as long as possible to launch re-election campaigns, but Obama and his team wanted to make a run at a billion-dollar haul for this election … and this from the candidate who sang hosannas about public funding of presidential campaigns, too.

Rick Perry: I support constitutional amendments to ban gay marriage and abortion

posted at 5:25 pm on August 3, 2011 by Allahpundit

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Two caveats to his otherwise strict support for the Tenth Amendment, both of which happen to serve the agenda of social conservatives whose votes he’s depending on. He backed away from his “states’ rights” defense of legalizing gay marriage last week; here’s the inevitable climbdown on abortion too, which he described as a states’ rights issue a few days ago. Follow that last link and re-read the post to see why it was predictable. I’m surprised he didn’t anticipate the tension his Tenther rhetoric on these issues would cause with his base, which he could have defused by mentioning his support for the amendments straightaway. There’s nothing necessarily inconsistent in that position: You can be a strong federalist and still condone federal solutions for exceptionally grave evils like slavery which the states, for various reasons, can’t be trusted to police as diligently as they should. That’s the core of the pro-life argument for an anti-abortion amendment — it’s a matter, literally, of life and death. What’s Perry’s argument, though, for why gay marriage qualifies as an “exceptionally grave evil” warranting a nationwide ban? Is smoking, say, an evil sufficiently grave to require a constitutional amendment outlawing it? (Don’t answer that, liberals.) He’s not in a legal trap here but he is in a philosophical one. And a political one, of course, as the press will use this to throw him off his economic message. Specify, please, which behaviors are so pernicious that we can’t risk letting parochial state legislatures deal with them.

Incidentally, as with Fred Thompson four years ago, the media’s “Perry as GOP savior?” hype is already being replaced by the “Perry as overhyped flop?” counter-narrative. Here’s Politico’s new piece wondering whether a tea-party-flavored Bush soundalike can get traction with the current conservative base. (One state Republican chairman compares Perry to “Will Ferrell doing a George W. Bush imitation.”) And here’s CNN noting that Perry’s upcoming prayer event, which can accommodate 71,000 people, has had just 8,000 registrants thus far. I doubt Perry cares — the real audience for that event is in Iowa, not Texas — but they’ll build that counter-narrative with any available brick. Exit question via Democratic pollster PPP: Does the GOP need Romney to win?

Tea Party won the first skirmish of a long, long fight

posted at 2:05 pm on August 3, 2011 by Ed Morrissey
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Did anyone win in the recently concluded deal that reduced the upward trajectory of federal spending?  In my column for The Week, I argue that Barack Obama certainly was the big loser, having blown an opportunity that he himself cultivated for months to demonstrate leadership.  While the deal doesn’t feel like a win to Tea Party activists at the moment, I argue that they won an important opening skirmish:

    Reid gave up on tax hikes, not because he got tired of talking about them, but because there isn’t any appetite for tax hikes on Capitol Hill — thanks to the power and influence of the Tea Party. The cuts mandated in this compromise might be paltry, especially at first, but they represent a step in the right direction. For the first time in perhaps decades, Congress will approach budget shortfalls by looking at where spending can actually be reduced rather than where revenue can be raised.

    That is a remarkable paradigm shift, and one worthy of celebration after a decade of exploding deficits from Congresses controlled by both parties. Without the Tea Party, that paradigm shift would never have occurred. Indeed, without the Tea Party and their victorious candidates, the debt-ceiling increase would have been a routine vote noted only by a few bloggers and the back pages of most newspapers.

    Understandably, most Tea Party activists see this as business as usual and not the kind of transformative, instant change they envisioned. But just as Rome wasn’t built in a day, it will take much more than one vote or one budget to build the kind of limited, fiscally responsible America that these activists desire. The expansion of the federal government has gone on for decades, and it will take many battles and victories, small and large, to reverse it. This is a long journey, and the Tea Party helped push the nation into taking a step in the right direction.

There are two dangers in incremental victories, which are closely related to one another.  The first is that they tend to discourage activists who want big, unmistakable, validating victories.  However, those will only come with big, unmistakable majorities in Congress and a different President in the White House.  Given the relative weight of the Tea Party caucus on Capitol Hill in this Congressional session makes the win here even more remarkable. It’s very important to remember that our political system is heavily weighted against radical change in the short term, and that lasting change takes patience and long-term planning.

The second danger is that the activists will turn on each other and on their nominal allies.  If that happens, they will lose the ability to grow their standing in Congress.  Worse, they will alienate those who want to work towards the same general goals but who may differ on tactics and time lines.  That will bring incremental progress to a halt, while at the same time pushing activists into giving up altogether.  We need to avoid a “Mission Accomplished” mentality, but more importantly recognize that incremental progress is not futile.

Meanwhile, on the other end of the ledger, Barack Obama comes out as the biggest loser in this fight.  I give an explanation for that in my column, but two media reports today confirm this as a consensus position.  First, The Hill takes us inside the negotiations, where John Boehner apparently ordered the President out of negotiations at one point:

    GOP aides and lawmakers, speaking on background, portrayed Boehner as the calm negotiator who repeatedly exasperated President Obama.

    Boehner last month asked the networks to televise his response to Obama’s address to the nation, a request which infuriated the White House, Republican sources said.

    On July 23, they claim, the White House called Minority Leader Nancy Pelosi (D-Calif.), telling her not to participate on a call with Boehner, Senate Majority Leader Harry Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.). Pelosi informed Reid, who declined to participate, and the call was canceled, the Republican sources said. (A Pelosi spokesman could not be reached for comment.)

    Later that day, the four leaders met with Obama at the White House. At one point, GOP officials said, the Democratic and Republican leaders asked Obama and his aides to leave the room to let them negotiate.

Reid reneged on the agreement that was reached at that point under pressure from the White House, according to the Hill’s account based on their GOP sources.  Obama had to send Joe Biden into the final negotiations instead.  But it’s not just Republicans who are painting Obama as a bumbling negotiator, as the LA Times reports:

    Moreover, many Democrats — including some ordinarily sympathetic to the president — feel part of the problem is of Obama’s own making. …

    Given the acrimony and the high-stakes deadline, the impasse posed a severe test of Obama’s negotiating skills. On the fly he sought to improve his relationship with Boehner, inviting the speaker to play a round of golf early in the talks. But White House officials believe that personalities aren’t at the root of congressional paralysis. …

    Others are more critical, comparing Obama unfavorably with presidents who made broad use of their executive powers in times of crisis: Harry Truman, who nationalized the steel industry in 1952 in the face of a steel strike, for example, or John F. Kennedy, who denounced steel executives for price increases and threatened them with an antitrust investigation.

    “I am just sorely upset that Obama doesn’t seize the moment,” Sen. Tom Harkin (D-Iowa) said as the final deal was coming together. “That’s what great presidents do in times of crisis. They exert executive leadership. He went wobbly in the knees.”

The White House apparently hopes that the deal will eventually be popular enough for Obama to benefit, but the problem with that idea is that Obama had nothing to do with the eventual deal.  His only stated demand — higher taxes — got taken off the table more than a week before the compromise.  At the end, Obama ended up accepting a Congressional diktat rather than leading the path to a solution.  Obama ended up as little more than a spectator at his own leadership opportunity, and everyone knows it

What about us? Responsible homeowners left out in the cold

Responsible borrowers who have good credit and make their payments on time are being told that the only way they can refinance is if they start defaulting on payments.
No relief for the responsible
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No relief for the responsible

Consider it yet another cruel irony of the housing bust: While hundreds of thousands of mortgage borrowers have been able to squat in their homes without making a single mortgage payment in months or even years, many responsible homeowners who have good credit and consistently meet their monthly obligations haven't been able to refinance in order to avoid losing their homes.

Many of today's homeowners purchased their homes during a time of easy credit, when mortgage products, like interest-only loans and option adjustable-rate mortgages were issued to the marginally qualified. And many were told that -- if they made their payments faithfully -- they could easily refinance out of these products into affordable fixed-rate loans once the payments started to balloon.

But that day has never come for some borrowers -- no matter how good their payment record or credit score.

Many lenders are refusing to refinance underwater mortgages -- loans that are higher than the value of the home -- because it would mean big losses for them if the borrower defaults, said Mark Zandi, chief economist for Moody's Analytics.

According to data submitted to federal regulators and analyzed by the Wall Street Journal, nearly 27% of mortgage applicants were denied mortgages in 2010, up from 23.5% a year earlier.

The cruelest twist? Lenders typically wait until a homeowner is in default before they are willing to modify their mortgage.

For some homeowners, the clock is ticking. In 2011, $1 trillion in adjustable rate mortgages are scheduled to reset. And many are scrambling to refinance their mortgages while rates are still low -- to no avail.

"What's breaking my heart is the people making payments every month who can't refinance their mortgages, through no fault of their own," said Senator Barbara Boxer (D-Calif.).

She has co-sponsored a bill, the "Helping Responsible Homeowners Act," for borrowers who want to refinance but are in "negative equity," owing more on their mortgages than their homes are worth.

Boxer's legislation also requires banks to offer interest rates comparable to what they're giving to borrowers who are not underwater. And it bans risk-based fees for mortgages issued by Fannie Mae or Freddie Mac that can be as much as 2% of the loan principal.

Here are four responsible homeowners who are currently trying to refinance their loans.

Awww: Obama campaign to blame debt negotiations for lower fundraising this summer

posted at 12:45 pm on August 3, 2011 by Ed Morrissey

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You know how it is when you keep putting off important tasks, like mowing the lawn, taking out the trash, and resolving budget standoffs with Congress. If you don’t handle them when you’re supposed to do so, they end up getting resolved at the most inconvenient times:

President Barack Obama’s campaign expects to raise tens of millions of dollars less this summer than it did in the spring because negotiations over the nation’s debt limit forced Obama to cancel several fundraisers.

Obama’s campaign said Wednesday it canceled or postponed 10 fundraisers involving the president, Vice President Joe Biden andWhite House chief of staff Bill Daley in the past month because of the debt talks, scrubbing events in California, New York and elsewhere.

Only weeks after the president’s campaign reported collecting a combined $86 million with the Democratic National Committee, Obama’s team is trying to lower expectations about its fundraising juggernaut while signaling to its army of volunteers and activists that they need to fill the void. Obama is coming off a bruising battle with congressional Republicans over raising the government’s debt ceiling and is expected to face a formidable challenge from Republicans in 2012 against the backdrop of a weakened economy.

“We’re going to raise significantly less in the third quarter than we did in the second quarter,” said Jim Messina, Obama’s campaign manager. “We will not be able to replace all of these events just because of his busy schedule. We always knew that he had his job and we had to do this around his schedule, and the truth is we just have to deal with canceling a month’s worth of events.”

Well, if Congress had addressed the debt ceiling and deficit reduction during 2010, Obama wouldn’t have had to spend three whole weeks in Washington negotiating with John Boehner. Democrats failed to pass a budget for FY2011 while they had large majorities in both chambers of Congress. Harry Reid refused to raise the debt ceiling in December during the lame-duck session, specifically because Reid wanted Republicans to get their hands dirty on the debt ceiling.

Obama doesn’t have any excuses, either. Almost as soon as Reid bailed on raising the debt ceiling, Obama’s team began raising the specter of default. What did Obama do to avoid the problem? In February, Obama submitted a budget request that increased the rate of deficit spending. When that flopped, Obama promised to produce a plan to reduce the deficit, using a national address in April to underscore the point. And then …. nothing. No plan, no specifics, just nothing until July, when Republicans offered plan after plan and Obama refused to accept them until utterly forced to do so.

If the President had done his job in February or even April, then none of this would have been necessary. Instead, Obama chose to lead from behind. If that caused him to miss fundraisers, it’s no one’s fault but his own. And that might be a much bigger reason for lower fundraising numbers this summer, fall, and winter

Biden to Gabby Giffords: “Welcome to the Cracked Head Club”

posted at 8:30 pm on August 2, 2011 by Allahpundit
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Via Breitbart TV. Since we’re grooving on insane left-wing double standards today, here’s the second thing this guy has said in the past 24 hours that would have become a national media scandal had his party affiliation been different. And before one of our three lefty readers wonders — no, this isn’t a Fox scoop. Other reporters heard Biden say it, including one from the Boston Globe. Which raises the question, what’s the dumbest part of this? That he’d joke about a cracked skull with Gabby Giffords, who may very well prove to be permanently disabled from having “joined the club”? Or that he found it amusing enough to share the anecdote with reporters later on? Free advice for conservatives and independents: Do not attempt this “joke.” Not only is it tone-deaf and callous, but you won’t get graded on the curve afterward. (“Oh, that Joe!”)

Giffords herself, you’ll be glad to know, is coming along well enough that Debbie Wasserman-Schultz thinks she can make it back to Congress. But reports early this morning that she’s planning to run for reelection turned out to be wrong. They’re hopeful that she’s well enough, but it’s still wait-and-see.

Bottom-lining the debt deal

posted at 2:00 pm on August 2, 2011 by Steve Eggleston
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There’s been a lot of numbers and rhetoric tossed about on what the debt deal (shortened to The Deal, not because I like it, but because it makes the phrase stand out) does and doesn’t do. However, I don’t believe anybody has done an exploration of the absolute effect is. It’s high time to do so.

Baselines matter

First, the base from which the reductions are to be needs to be established. While that base has been established to be a “modified” version of the March 2011 Congressional Budget Office extended-baseline scenario, a quick review of which is part of the CBO’s review of the President’s FY2012 budget proposal.

The extended-baseline scenario assumes the CBO’s estimates, based on current law and not necessarily current policy, of direct spending (which, among other things, ends the Medicare “doc fix”) and revenues (which, among other things, assumes that all of the Bush tax rates expire at the end of 2012 and the Alternate Minimum Tax is no longer “indexed” to keep middle- and lower-income Americans from being caught in that trap), and that every top-line category of discretionary spending that does not explicitly end in FY2010 is increased at the rate of inflation.

The bottom line on that is that, on $39.03 trillion in revenue and $45.77 trillion in outlays, there would be $6.74 trillion in deficit spending. However, there are a couple of “wrinkles” that were added to that in the baseline used.

Normally, that would include spending on what used to be known as (and is still called by the Republicans on the House Budget Committee) the Global War on Terror. However, every entity, from the White House to the House of Representatives to the Senate Democrat leadership, agrees that, instead of spending $1,589 billion over the next 10 years as the extended-baseline scenario calls for, $545 billion will be spent. While the CBO excluded the entirety of that at the request of Congress as it is not part of this bill, I will add the $545 billion back in, using the House budget spending by year, as there is no difference year-to-year between the President’s and the House of Representatives’ budgets.

Also, the CBO, at the request of Congress, has figured in the effects of the final FY2011 continuing resolution. That is another $122 billion reduction in spending.

Taking the full effect of those modifications into consideration, the federal government would take in $39.03 trillion in revenue, spend $44.60 trillion, and run a 10-year deficit of $5.57 trillion.

There are a couple of other “baselines” that one could choose. The President’s budget, according to the CBO, would take in $36.70 trillion in revenue, spend $46.17 trillion, and run a 10-year deficit of $9.47 trillion. That budget already includes all of the modifications above.

An “Alternate Fiscal Scenario” from the CBO, which assumes various spending and revenue options, including those outlined above, are affirmatively extended rather than allowed to expire or otherwise not happen and last outlined in percentage-of-GDP form in June, would also need to be adjusted by the above adjustments. Once that is done, it would presume $35.05 trillion in revenues, $46.81 trillion in spending, and $11.76 trillion in deficits.

Meanwhile, the House budget, which keeps all of the Bush tax rates, indexes the AMT, and does some further tax cuts, envisions $34.87 trillion of revenues, $39.96 trilion of spending, and $5.09 trillion of deficit spending. Like the President’s budget, it already includes all the modifications above.

The first 2 years – $63 billion in scorable deficit reduction versus the “adjusted” CBO baseline

Like the CBO, I cannot and will not attempt to score the effects of a potential $1.2 trillion in “trigger” cuts, $1.5 trillion in “commission” cuts, or adoption of a Balanced Budget Amendment. However, I have actually read the bill, and the discretionary spending caps are, unlike the $1.2 trillion-$1.5 trillion in “additional cuts”, actual hard numbers, not nebulous percentages or “reduction” numbers”. Therefore, actual bottom-line spending comparisons can be made against any base. As the CBO used an adjusted version of their March 2011 baseline, I added the (all-but-)agreed-to spending levels on the GWOT to do so.

Using the adjusted CBO baseline, there would be, between FY2012 and FY2013, $5.65 trillion in revenue, $7.34 trillion in spending, and $1.69 trillion in deficit spending. Adopting The Deal l would knock the spending down to $7.28 trillion and deficits down to $1.63 trillion.

By way of comparison, the President’s budget would have $5.44 trillion in revenue, $7.51 trillion in spending, and $2.07 trillion in deficits. That’s an additional $233 billion in spending and $438 billion in deficits versus The Deal.

The House budget would have $5.39 trillion in revenue, $7.09 trillion in spending, and $1.69 trilllion in deficits. While spending in the House budget would be $190 billion less than The Deal and $253 billion less than the adjusted CBO baseline, the deficit would be slightly higher than The Deal and insignifiantly less than the adjusted baseline as, instead of the Bush tax rates expiring at the end of 2012 (1/4th the way through 2013) and the AMT “indexing” not happening, both would continue as they have the past 8 years.

The “out” years – $855 billion in “scorable” deficit reduction – if The Deal holds

I will preface this that there is a significant amount of debt service savings from the reductions in spending on the GWOT that were scored in the two budgets that were not scored separately in even the CBO analysis of the Senate proposals. Judging by the CBO scoring of the Senate proposal versus the House proposals and The Deal, that is roughly $220 billion in reduced spending over the 10 years not reflected in either the adjusted CBO baseline or The Deal.

Also, the bulk of the $1.2 trillion-$1.5 trillion in additional deficit reduction, or any adoption of a Balanced Budget Amendment, will happen in this time frame. As noted above, that cannot be properly scored as yet.

With that said, the adjusted CBO baseline anticipates $33.39 trillion in revenues, $37.26 trillion in spending, and $3.87 trillion in deficits between FY2014 and FY2021. The Deal changes the spending to $36.41 trillion and the 8-year deficit to $3.02 trillion.

The President’s budget is a veritable blowout of spending, especially deficit spending. On $31.26 trillion of revenue, there would be $38.67 trillion of spending and $7.40 trillion of deficits.

While the House budget would continue to spend less at $29.48 trillion, its reduced expectation of revenue of $32.87 trillion would result in $3.39 trillion in deficits.

What about tax hikes?

While The Deal does not explicitly address taxes, I’ve got bad news for everybody (or at least everybody who thinks a non-WWII record level of revenues as a percentage of GDP in 2021 is a bad idea) on that front. Any attempt to either extend any part of the Bush tax rates beyond 2012 or keep “indexing” the AMT will be scored as a deficit increase. The back-of-the-envelope numbers on the various proposals are that the “scored” increase would be about $2.5 trillion for the Obama “hold those under $200K/$250K harmless” plan, $3.5 trillion for full extension of the Bush tax rates, and $4.2 trillion to continue the entirety of the current tax structure.

What about S&P and Moody’s?

Again, baselines matter. Unfortunately, neither S&P nor Moody’s appear to have mentioned from which baseline they wanted the “$4 trillion in deficit reduction”. It has been said that Cut, Cap and Balance, even before adoption of the Balanced Budget Amendment, would have met that. However, I have not seen any CBO score on that.

Moreover, up until the Congressional leadership decided to start talking to each other instead of with President Obama, it was widely assumed the $4 trillion that was being talked about was against the President’s budget and its $9.47 trillion 10-year deficit spending. The House budget, and the Cut, Cap and Balance bill that, after higher spending in FY2012 compared to that, used percentage-of-GDP spending levels based on that budget, would easily have cleared that hurdle.

Going against the President’s budget, The Deal, with $4.65 trillion in 10-year deficit spending, also would very easily clear that hurdle, even before the “trigger”/commission/BBA. Moody’s has already said they would maintain a negative outlook on the US soverign debt, while S&P is making noises that they will downgrade the debt. I have to wonder what more those credit rating agencies want.

Revisions/extensions - I really need to proofread these opii. Corrected a typo. I hope there isn’t more.

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