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October 2008 Archives

October 1, 2008

The Financial Problem Reaches Commercial Real Estate

Prices for commercial real estate have been running counter to the downward trend in home prices--but not any more. Hit hard is Manhattan, but other cities are sure to follow. One almost can hear the construction of new commercial buildings, not to mention condos, grinding to a halt.

'Twas ever thus. You can visit almost any big city and see in its architectural record the story of previous booms and busts. How beautiful were the sparkling Art Deco structures of the Roaring Twenties, and then it all stopped. (With notable exceptions like Rockefeller Center in New York. There young Nelson R. prevailed on his father to follow through, and the investment did pan out.) Films of the 1930s overall show a New York of nostalgia rather than progress.

In Seattle, there is almost a line in the northward march of the city's business district, from where the Progressive Era petered out, about Second and Marion. And then nothing new of substance was constructed for another twenty five years! Thereafter, one discovers in confident new buildings the Seattle booms of the late 50s, the late 60s and especially the 90s. Now what? The Washington Mutual Building, astride the new Seattle Art Museum, could turn into a wounded dinosaur or it could be someone's lovely new bargain headquarters.

One hopes a commercial real estate bust is not what we are facing, but if it is, we'll manage. Somehow, I don't think it will last long.

October 3, 2008

Canada's Strange and Marvelous Election--a Preview

If you are frazzled by the endless American election campaign, go to the Canadian press and television and look into the brief, spirited federal elections that began up North a little over a month ago and will end in eleven days. If for no other reason than that it is enjoyable to watch a campaign where one is intellectually, but not emotionally, invested, Canada's election campaign offers a fascinating escape for Americans. We might even learn a thing or two.

Start with adjusting one's ideological perspective. Some in Canada apparently regard the incumbent prime minister, Stephen Harper, as a frustrating and even dangerous right winger. But he surely would be viewed as a moderate Republican or Democrat in the United States. Nonetheless, until recently Harper's Conservative Party--an amalgam of the old Progressive Conservatives that were nearly wiped out 15 years ago and the western-based Alliance party--was on its way to gaining a majority in the parliamentary elections October 14.

This may be changing. In the past couple of weeks Canada began to catch the economic jitters that already are shaking the United States hard. The Toronto stock exchange followed Wall Street down. The Canadian dollar, the "Loonie", weakened a bit, though it is still close to the U.S. dollar (94 cents). Objectively, Canada is in better shape than most Western countries, but that doesn't stop people from worrying--and premptively planning blame as conditions deteriorate. Undoubtedly, the Conservatives wish the election could be held right away, while they are well ahead.

It is not that most people love Harper or even trust him, it is just that he seems competent, frugal, unflappable and honest. He is mild mannered and yet deceptively decisive. To some those traits are reassuring, to others they are infuriating and sinister. Leftists call him radical because, well, as a leader of the minority five years ago he backed the U.S. invasion of Iraq. He has since recanted and he even has agreed to put a two year limit on further Canadian participation in the war in Afghanistan. He cut the hated GST (the value-added Goods and Services Tax). He throws money at the arts and various social ailments, though never enough to satisfy the various organized constituencies. He has begun to build up the military, but only to the extent that Canada no longer is embarrassed by its navy ships being declared unseaworthy, as was was the case a few years ago. Canada seems more assured and confident now.

A major reason Harper and the Conservatives aren't in even better shape is simply that Canada is not, in any sense but temperament, as conservative as America. It is a fluke of the Canadian multi-party system that Harper's plurality in the 2006 election, when the Liberal Party's long dominance was ended, resulted in a minority-run Conservative government. It is the continuing good luck of the Tories that the opposition parties, while all to the Tories' left, are numerous, small and don't play well together. That means that the Tories don't have to get a majority, they just have to keep their opponents divided and maintain a few points' lead on the nearest competition as the polling begins.

Accordingly, having broken through in Quebec in the 2006 federal elections and thereby becoming a true national party, the Conservatives have a shot at a "majority" led government in Parliament, albeit one elected by a decided minority of the electorate. Right now the CBC, Canada's public television station, has a poll showing the Tories with 36 percent of the vote, ten points ahead of the Liberals.

The formerly formidable Liberals, under Stephane Dion, are stuggling under a misguided decision to start wearing a campaign costume of green just as ideas like their carbon tax proposal are beginning to annoy voters who suspect anything with "tax" in it. Dion is an able French speaker who, however, can get tangled in a fast-paced English debate. The Liberals are a true national party, too, but a weak one following the scandals that helped defeat its former leaders. Crowds are sparse for Dion this fall.

The New Democrats, under Jack Layton, play to a limited labor and social libertarian base and are plumping for a cap and trade energy idea that is hard to explain. They have been embarrassed by candidates who seem to approve trafficking in marijuana or hold other exotic views that are a bit outside the Canadian mainstream. The NDP is a perennial also-ran on the national level, but this year, thanks to the campaign ardor of Layton and sagging enthusiasm among Liberals, the party may do do better than usual. The NDP stands at 19 or 20 percent in the polls.

The Bloc Quebecois, under Gilles Duceppe, never does well nationally, of course. Its whole game is in Quebec. Since the exciting days when it seemed on the verge of leading provincial voters in a transfer of sovereignty to a new and independent state, the separatist cause has waned and, with it, the fortunes of the Bloc. Now the Bloc is left with a laundry list of ethnic French cultural and welfare demands that probably don't excite young people, let alone business people and many academics. Liberals and Conservatives both eye the Quebec vote.

Finally, gregarious, ebullient Elizabeth May of the Green Party, scored big in this election campaign by forcing her way into the national televised debates. (The party has no votes in Parliament, despite a large, diffuse following.) Permitting the Green representative into the debates supposedly came over the objections of the Conservatives as well as the NDP, but it is hard to see how the Greens' growing prominence can but help the Tories in the long run. They will cut deals with Liberals in certain ridings (electoral districts) and May is clear that she supports a government headed by Dion. But might not the Greens also cut into Liberal numbers, and the NDP's, too? Could they cost the Liberals certain Quebec ridings? As of now, the Greens have nine percent support in the polls.

In the two televised debates held this week, Dion reportedly did well in the first one, conducted in French, while the dreary, kitchen table gabfest conducted in English last night, was probably a draw. It would have been a draw-and-quarter of Harper, since everyone wanted a piece of him, except that the overall impression was one of stupifying kibbitzing. Imagine five candidates trying to talk at once!

So, the Conservatives should be on their way to a substantial victory, right? Their ten point lead over the Liberals, and 15 points over the NDP, should translate into a majority in the new Parliament. In public, Tories have been modest, not claiming a majority government, but that is what many have expected.

Until now. Canadians are just as human as anyone else and part of human nature in politics--even in a country of modest size, sitting next to the gargantuan USA--is to imagine that the people in charge of one's government at the moment are responsible for any problems that exist. Canada has relatively low unemployment, low inflation, ample domestic energy (unlike the U.S.) and mortgage laws that did not permit the hideous credit crunch that has its American neighbor. Harper points all of this out, but even the media have joined the opposition politicians lately in hand wringing.

Instead of looking around the world and being grateful that they are as well off as they are it may well be that Canadians will vote to keep their Parliament splintered and their government hobbling on splints.

There is much to be said for a parliamentary system, a blessedly short national campaign being near the top of the list. But there is also something to be said for a two party system where someone is more likely to come out on top with a mandate.

**
NOTE: Discovery Institute will host a post-election review of the Canadian election results, and what we can learn from them, on October 15 at Discovery headquarters, 208 Columbia, in Seattle. I will be joined by Canadian studies professor Don Alper of Western Washington State University and former Canadian Counsel General Roger Simmons. It should be fun. Please join us for lunch. Check the Discovery "Events" column on our Home Page for details. Canadians especially welcome!

October 9, 2008

Two National Campaigns at Once

The Canadian federal campaign is full of so many follies among all parties that, ad seriatum, the advantage keeps changing. If you are following the U.S. campaign (as even the Canadians are doing) there is a kind of morbidly fascinating similarity in that respect. For political junkies I recommend a two-campaigns-at-once examination.

A couple of nights ago Prime Minister Stephen Harper--the "cool hand at the tiller," as he describes himself--was asked by Peter Mansbridge of the CBC what advice he would give Canadians disturbed about the stock market collapse. He smiled wryly and suggested that now was a good buying opportunity. Chuckle, chuckle.

The other party leaders immediately jumped on the gaffe. (What happened to, "When there is a panic, don't be the one to be panicked."?) No wonder the Conservatives have started descending in the polls. Their policies may be sound, but they seem to lack empathy for an electorate shivering in fear.

But the very next day, Liberal leader Stephane Dion was interviewed by the same Peters Mansbridge and asked if, in light of the economic times, he would delay the Liberal plan to impose a carbon tax as part of the party's response to global warming. Not at all! Dion was so excited that at certain points he lapsed into French, assuring Mansbridge that the proposed new tax was merely part of a green transformation of the Canadian economy that would wind up creating more jobs and opportunities. Unhappily for the peppy Mr. Dion, his party's other top leader, Michael Ignatieff, was saying in an interview that it would be wise to hold up for a while on a carbon tax right now.http://www.theglobeandmail.com/servlet/story/RTGAM.20081009.welxndion1009/BNStory/Front

Then there is the Green Party candidate, Elizabeth May, who practically sabotaged her own party's candidates yesterday by urging "strategic voting" to defeat Harper. So far as I can tell, that means that one only votes Green if there is no chance of the Liberal candidate in your riding (district) getting elected. To put it still another way, you only vote Green if you wish to waste your vote! At best, this uncertain trumpet seems likely to confuse the Green electorate (not to mention the Green Party candidates!) and was opposed at once by David Chernushenko, the candidate who lost out to May in the most recent Green Party leadership contest.http://www.theglobeandmail.com/servlet/story/RTGAM.20081009.wmaycomments1009/BNStory/politics/home?cid=al_gam_mostview

As one result of the Liberal and Green presentations, Conservative prospects may be brightening again. Tomorrow's Globe and Mail, the normally liberal-leaning national paper, is endorsing Harper. http://www.theglobeandmail.com/servlet/story/RTGAM.20081009.weelection2008/BNStory/politics/home?cid=al_gam_mostview


On the other hand, maybe the Dion-May entente will work somehow and the nine percent in the polls now favoring the Green ticket will switch en masse to the Liberals--thrilled by the expectation of the new carbon tax--and carry Mr. Dion's ticket to victory.

In the United States, meanwhile, Sen. Obama seems within striking distance of wrapping up the election. Polls showed a shift further in his direction after the most recent presidential debate. There were no gaffes by McCain, but none by Obama, either, and it was McCain who needed to give people clear reasons to vote against Obama and for himself. Instead, his boxing blows were glancing and almost worse than ineffectual. They appeared to be peevish.

So, advantage Obama, right? Yes, except that there is growing and deleterious information about Sen. Obama's past in Chicago that finally is coming to light. For months and maybe years it disappeared. The media failed to dig it up and in the primary campaign Hilary Clinton made only timid, McCain-like references to it. Either Obama offered himself in Chicago's South Side as a radical or he did not. At this time of economic turmoil, the truth, as opposed to the image, may matter.

The context is the economy and who can you trust in government to deal with it? Oddly, plenty of people seem to be in charge, but no one seems to be clear about what is going on. The grim sense arises that nobody really knows. Not in Canada and not in the U.S.

Santorum on Why the Economic Meltdown

Sen. Rick Santorum of Pennsylvania was defeated--soundly--in the last election, and the consequences for the Senate and the country are still being felt. His take on the current meltdown in the economic is instructive.

October 10, 2008

Under-reported News and Issues

Serious news developments are going under-reported and significant national issues un-discussed in the presidential race because we are all deluged with stock market stories. There are even many stories related to the market that are not getting play yet.

The recent hurricanes damaged U.S. production of oil and temporarily slowed the slide in oil prices, but they did terrible damage to Cuba. Since there are few American reporters there and the Communist regime is not really interested in exposing its weaknesses, the reality goes mostly un-noticed. But here is a story with some insight.

Cuba depends on Venezuela for oil now, but Hugo Chavez also must be facing strains now that the prices for his country's main product have dropped from $147 a barrel to $80. Leftists like Chavez are seldom careful about spending commitments, so it is likely that his regime is going to feel serious strain now. Great story. Not reported yet.

The same squeeze is on Iran and Russia, of course. Already the Russian government's recent hostility toward the West seems to be abating. As I noted several months ago, it usually is not a good idea to threaten one's customers, but that is what Russia was doing to the Europeans. It is a temptation that the Kremlin is finding it easier to resist right now. (By the way, Russia reportedly has huge cash reserves. How is that affecting the economy in the current international crisis? Doesn't Bloomberg News' excellent team in Moscow have a story in depth to tell us about that?)

Another under-reported international story is in the field of human rights. It is a mystery to me why the McCain campaign has not publicized the fact that Sen. Joe Biden, as chairman of the Senate Foreign Relations Committee, has been holding up passage of the Wilberforce Act of 2008, a bill that would strengthen the law against human trafficking. His reported reasons are bureaucratic, trivial and unresponsive to the world wide problem of slavery. A new film (Call + Response) highlights the situation, and among other things, features Discovery Senior Fellow John R. Miller, former U.S. Ambassador for Human Trafficking Issues.

Domestically, there has been a doubling of money going to Amtrak to improve service, but it was voted through in the midst of the bailout legislation and without any apparent discussion or debate. America needs a first class passenger rail system to supplement air and auto carriers. But because of unenlightened union opposition the Democrats in recent years have prevented any effort at reform and partnership with the private sector. The new money won't really change much at all. Given the overall energy issue and the pressures on the present transportation system you might think that at least one of the candidates for President would be talking about this. But they aren't doing so, are they? Do they imagine that travelers in states on the Eastern Seaboard, the Great Lakes region and the West Coast are not interested?

Speaking of energy, there is the under-emphasized potential of nuclear power. McCain is all for it. But why isn't he conspicuously going to the places where it could be installed and calling attention to the subject? Nuclear power is back in vogue, even among many environmentalists, and it promises the responsible, relatively inexpensive energy that U.S. industries need to save and create jobs. He mentions it, but he doesn't hammer it home the way Ronald Reagan did--by giving TV viewers a backdrop image.

Another issue that McCain under-plays is his support for expanding the personal income tax exemption for people raising children. Reagan doubled it in '86, as McCain undoubtedly knows. It would be a huge break for parents (single parents as well as two parent households). But it is being lost in the din. McCain needs to be in people's kitchens explaining the issue.

One could go on and on, but let me end with this observation: In a time when the stock market is telling us that a recession is surely at hand, one might expect that the federal government would be doing all it can to at least push out of the Treasury pipeline funds for various public projects in transportation and other fields that already are authorized and appropriated. The market crash is about to start rippling through the economy, with building slowdowns and job losses. Already existing federal projects could help take up the slack. I'm not talking about a big new public works program--the kind that typically wouldn't be effective until after the recession is over--but planned projects that the bureaucrats just can't seem to get into action. They need a push. Why aren't they getting one?

October 11, 2008

Oil Opportunity

Why do the media treat the drop in oil prices as a problem that "darkens" the news, when they similarly greeted the upswing of prices a year ago as foreboding?

The fall in oil prices is good for the economy short term and long term. Would we be happier if the price per barrel went back up to $150?

With the presidential campaign riveting national attention, both parties should commit to a twin strategy:

1) Substitute domestic oil for foreign sources to the fullest extent possible. That means, of course, we must drill drill off-shore without delay. It is still profitable to drill at the suddenly lower prices and doing so will reduce our dependence on foreign oil. It would be folly to drop the subject now as we have in the past when prices fell. Oil exploration is not something you can start and stop according to the vagaries of politics.

2) Link the exploration policy with a concurrent policy of conservation, including hybrid cars, tax credits for heating insulation, a serious national passenger rail program and other realistic measures, including alternative fuels. Push hard on new, safe nuclear energy and stop the costly and environmentally counter-productive emphasis on ethanol (except for promising new technologies such as algae.)

Combining these strategies makes good sense economically, politically and militarily. There is no good reason why conservatives and liberals should not be able to join together on this. Can we please have some leadership from our "leaders"?

Expedite AMERICAN Spending on Infrastructure

The Conservative government in Canada is expediting already committed public spending on infrastructure as a way to help the struggling economy.

Why isn't the Bush Administration doing the same? And if it is doing so, why isn't it saying so?

October 13, 2008

Canadian Polls Show Why You Can't Count on Polls

Canada's Thanksgiving Day is today. Tomorrow is the federal election for Parliament. Therefore, except for last-minute polling that interrupts people's family turkey dinners, the final polls are from yesterday. And they diverge considerably. And there still is uncertainty shown in the electorate, with a 46 percent "undecided" column in one poll. Granted, the "undecided" term may represent people who in the end are not going to vote anyway. Nonetheless, the lesson for Americans in our own election should be, don't count on the polls.

All three top polls show the Conservative Party of Prime Minister Stephen Harper winning re-election, but only to another minority government. The differences come in the prospective margins.

The Strategic Counsel poll conducted for the Toronto Globe and Mail and CTV has the Conservatives ahead of their closest rivals, the Liberals, by only 33 percent to 28 percent (five point spread), with the New Democrats (NDP) coming in at 18 percent, the Greens at 11 and the Bloc Quebecois at 10 (that is all in Quebec, of course, where the Bloc vote stands at a nearly commanding 42 percent).

The Harris/Decima poll shows the Conservatives ahead by nine points (35 percent to the Liberals' 26 percent--NDP at 18. That is a nine point spread.

The Ekos Research poll falls between the others, with the Conservatives ahead 34 to 27 over the Liberals (six points).

Somebody's wrong, which is to say, the samples are different.

October 15, 2008

Canada Shows Polls' Weakness, Conservatives' Strength

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Conservative Prime Minister Stephen Harper, and Liberal Leader Stephane Dion.

The previous post on Canada's polls questioned the wide spread in predictions, from a Conservative victory by nine points over their nearest rivals, the Liberals, down to a five point Conservative win. The actual Conservative spread in yesterday's election was 11.4 percent--and that in a contest where differences are exaggerated by the presence of five parties in contention. Moral: you can't count on polls, something worth noting especially in our own election right now.

There are a number of surprises in the Canadian outcome. First, the large Conservative numerical and percentage plurality did not enable the Tories to win a majority in Parliament. They gained 16 seats, while their top rivals, the Liberals, dropped 19, so it is a real plus for Prime Minister Stephen Harper and the Tories. First, Harper responded to criticism of his modest cuts in arts funding by making light fun of people who attend expensive arts fund raising "galas" and then complain about cuts in culture. In most places he probably got a chuckle with the allusion, alienating only a few artists who don't vote Conservative anyhow. But in Quebec "culture" is a surrogate for provincial identity and the separatist cause. The Bloc Quebecois made it seem that Harper was ridiculing French Canadian culture.

Then, when Liberal leader Stephane Dion three times fumbled a CTV question about what he would have done about the economy if he had been prime minister, the Tories made fun of his inability to answer a simple question. Dion was hurt nationally, but in Quebec he was defended as a Francophone speaker who was being ridiculed for not speaking and understanding English well enough. In both cases Harper was innocent of any malice toward Quebec or French speakers, but his opponents made enough use of his statements to blunt any gains the Tories had expected.

It is hard to see how the Conservatives could have made a majority this year anyhow. They might have found a couple more seats in B.C. and in Ontario, but even with a couple of gains in Quebec, they still would have been shy of a 155 seat majority. They were not successful in Atlantic Canada, especially in Newfoundland, where Harper is very unpopular for local reasons. In any case, it is hard for anyone now to get a majority in a system that seems to so many parties.

But if the Conservatives were a bit frustrated at their failure to gain a majority, the Liberals are broken and reportedly broke. Their "green" tax policies backfired and Dion, a former professor, was not persuasive on the stump. It has to be asked of the Liberals now what was asked of the conservatives 15 years ago: are they still a national party? The fastest growing region is the West, where the Liberals now are down to seven seats (the Tories have 70). Liberals can't seem to make any more progress than the Tories in Quebec and they are fading in Ontario.

It is not clear that the NDP is much of a national party, either. If the Conservatives have trouble winning in urban areas, the NDP is vacant in most of Quebec, the second largest province, and large swaths of suburbia and rural Canada.

The parties are all tired now and the nation plainly is tired of them. Tuesday's 58.5 percent turnout was the lowest on record. There doesn't have to be an election for four years, but it is very unlikely that there will be one for at least two. What Harper and his party now face is stabilizing the Canadian economy. Fortunately, it has been outperforming others in the West, which may be one reason that the Conservatives performed as well as they did in a time of financial worry.

The next political excitement in Canada will probably be an internal leadership fight in the Liberal Party, with Dion challenged by Bob Rae and Michael Ignatieff. The latter was shown in this campaign as a smart, adroit speaker for the party.

A peek at a more distant future comes with the political arrival of the Liberal Justin Trudeau, son of the late, long-serving Prime Minister Pierre Trudeau, who transformed Canada into a much more liberal country two generations ago. Young Trudeau was elected in Montreal.

Discovery Panel Reviews Canada's Election

This from Bruce Ramsey of The Seattle Times (for tomorrow).

October 17, 2008

Psst! Don't tell Anyone, but Glaciers are Growing in Alaska

alaska_glacier_bay_margerie.jpg


Here's another news story that was big in one area (Alaska), but nowhere else. It does bear on the global warming issue, doesn't it? The most fascinating fact in this Anchorage Daily News story is that the glaciers have been receding for TWO HUNDRED YEARS. That is, since before the beginning of the industrial age.

October 21, 2008

Europe Getting Skittish on Energy Goals

(From Patrick Bell in Vienna)

It appears the E.U. may now be applying the brakes on its
climate and energy plan that was negotiated late last year. Expressing
concerns about the economic costs it might impose, Poland, Italy, and several
other E.U. member states are rebelling. European fans of more controls fear
that if the plan isn't solidified by late December, when the Czech Republic
gets the E.U. presidency, the whole thing might come apart. (The Czech
government is largely divided on climate change.) The E.U. Commission also
wants to have a strong plan in place to use as leverage with the next American
president.

Several vulnerabilities, meanwhile, are coming into focus with the E.U.'s cap
& trade system. For instance, mandating two policy targets (20% reduction of
emissions by 2020, and 20% increase of renewable energy use by 2020) may sound
good in theory, but under the current design of the E.U. system, these targets
may be contradictory in practice. Countries like Austria are meeting their
reduction target (cap) by importing credits from abroad (trade). The trouble
is, under this scheme, Austria, for example, actually sends valuable
investment dollars abroad that otherwise could be used for domestic renewable
energy projects, while not actually achieving reductions in its emissions.

And of course, not all industry sectors are covered, so there are plenty of
objections about favoritism.

New Stimulus Plan is Old Bad Idea

The stimulus plan passed in the the summer didn't do anything to salvage a drooping economy, did it? So now the Democrats have an idea: they want another one. Somehow in the feverish days of a presidential campaign a scheme to hand out another $300 BILLION in checks is barely considered worth discussing.

But Steve Forbes discussed it first last February and hit it again at the Gilder/Forbes Telecosm conference and again lately.

Bailout mania has overtaken common sense. Even the United States cannot just throw money at a problem and hope to solve it. What we can do is damage our dollar--a surprising strength right now--and go into long term economic decline. Instead invest that money in new businesses and jobs through tax cuts and infrastructure.

Discovery Fellow John Miller Hailed in New Film

Call + Response is a gut-wrenching look at sex trafficking. Among the few heros is Discovery Senior Fellow and former U.S. Ambassador (and Congressman) John R. Miller.

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October 23, 2008

News Organizations Show Their Partisan Colors

The longest presidential campaign in U.S. history is now eleven days from completion, unless the lawyers take over after the polls close and keep the show running even longer. The television and radio broadcasters increasingly are taking sides without much embarrassment. Are we developing a system of openly partisan media as in Jeffersonian days? It would seem so. The masks are coming off. Maybe that will prove healthier in the long run. Once people realize the bias of the press and broadcast media they will be better on guard against it.

One example is the way malfeasance in the election process itself is handled. There is no question that ACORN is under criticism for fraudulent voter registration in over a dozen states nationwide. ACORN plainly aims to benefit the Democratic Party, though it is supported by the government. So brazen is ACORN that even Democratic elections officials, as in Nevada, have been incensed by the group's improprieties. (From my experience, most elections officials are honest and want to run an honest operation, regardless of their own affiliation.)

So, when CNN wants to show an example of election fraud, what do they do? They run a segment about the rare Republican who has been indicted. There was a time thirty years ago when CNN truly tried to present news objectively. Those days are gone.

Then there is the Sarah Palin treatment. It is preposterous that Gov. Palin and her husband should be hauled before a state personnel board in Alaska eleven days before a presidential election. But no one seems to protest in the media. Instead, they will be at the hearing with hundreds of cameras and reporters.

Enormously important issues like the coming crisis with Iran are going unremarked in the media during this campaign. That makes it particularly breathtaking to see the fourth estate wallowing in such trivia as Palin's clothing. Dan Henninger gets much of it in today's Wall Street Journal column.

October 25, 2008

Bet Your Hedges: Gilder Says Creativity Will Revive Economy

Discovery Sr. Fellow George Gilder, co-founder of Discovery Institute, has a fine Forbes magazine piece up today that shows the confidence and hope the political candidates are missing.

October 27, 2008

RX for Ailing Newspapers

newspaper-ad-declinje_25.jpg

Circulation continues to decline steeply at almost all major city dailies. The only exceptions are USA Today and The Wall Street Journal.

Is it the Internet that is killing them? Well, it is a major part of the problem.

But another is the decline of effective literacy among the young and the even steeper decline in understanding of basic citizenship (what used to be called "civics") and economics. Newspapers can't rely anymore on their readers to possess a basic grasp of how Congress, the courts or administrative agencies work, let alone state and local governments. Stories therefore have to be sensationalized or dumbed down. Smart people then flee the papers for more intelligent coverage and the papers are stuck with a downscale readership.

Why don't young people understand civics? Because the schools either neglect the subject or downplay it or turn it into a left wing morality tale that ultimately is demoralizing.

And who has supported all these changes in schools? Often it is the local big city newspaper.

Then there is one other reason for readership decline, and that is growing media bias. If you can't count on straight news and editing, then you just give up on your local papers. Why waste your time with the views and opinions of some reporter who knows little but has a high opinion of himself? One reads a paper to get news--straight news, real news. When one finds that the real news is not found there, he stops using the paper as a resource.

For all of us who treasure newspapers--and sequential thought--it is sad to see all this happening. The end of newspapers isn't going to improve the sum knowledge and responsibility of the electorate.

Please, someone, give us newspapers that report the news in such a way that one can't discern the personal views of the reporters and editors. And use the editorial pages to campaign for better schooling in civics. You'll have to fight the teachers' union, but that, as they say, is another story.

October 29, 2008

It sounds like an improvement at Oxford

Richard Dawkins' replacement plans on steering his predecessor's position away from attacking God and replacing it with a more general approach to science and public understanding. Sounds like an improvement.

David Brooks: A Modern Chesterton?

by Logan Gage

Phillip Johnson once remarked that if one were to take a high school biology textbook and replace every word that read "evolution" with "design" the content of the book would remain the same. That is, Darwinian evolution plays a largely narrative, rather than descriptive, function.

I've often thought the same about New York Times columns from David Brooks. Every once in a while, after a beautiful 700-word description of the frailty of the human condition, or after a Hayekian description of the limits of human knowledge, Brooks will slip in the word "evolution" in meta-narrative fashion. But if one were to insert instead more traditional, even theological words or phrases (say: "original sin" or "depravity," etc.) the content would remain largely the same.

For instance, his latest column, "The Behavioral Revolution." I believe that you will see what I mean in his description of the limits of human knowledge and his critique of modern social science. He writes, "Economic models and entire social science disciplines are premised on the assumption that people are mostly engaged in rationally calculating and maximizing their self-interest. But during this financial crisis, that way of thinking has failed spectacularly." With a more theological analysis, we would see that modern social science treats men like machines (The Abolition of Man, anyone?) when they are much more than that: they have immaterial souls and rather corrupt hearts which do not fit into the reductionist's analysis.

Brooks thinks that "sophisticated psychology" is showing us that the materialist analysis is not incorrect, that we do not perceive situations as Spock-like creatures. But the common man thinks this common sense. Brooks writes of a scholar who "believes that our brains evolved to suit a world much simpler than the one we now face." The scholar believes, among other things, that evolution explains "our tendency to spin concurring facts into a single causal narrative; our tendency to applaud our own supposed skill in circumstances when we've actually benefited from dumb luck."

But the evolutionary answer perpetuates the materialist's problem. If we are only matter in motion, merely the products of our environment, the social science models should work perfectly. If Brooks would only look to the older, common sense view he would find a more satisfying answer.

Brooks seems to have a very keen sense of the human condition, but the evolutionary meta-narrative doesn't really fit as well as the old theology. He reminds me of G.K. Chesterton who remarked that after spending years trying to come up with his own religion, after puting the finishing touches on it, ideas about humanity and God and the state of contemporary society, a curious thing happened: He took a step back only to realize that his syncretistic heresy was actually orthodoxy.

I suspect the same may happen to Mr. Brooks.

October 30, 2008

What Happened to Global Warming Issue?

The strange life of policy issues has one replacing another as the two year presidential marathon campaign closes. Supposedly vital issues aren't resolved, just shed. Global warming, for example, was on every TV screen this time a year ago - Climate change 'Cold War' looms, Climate change a 'mega disaster', Climate outlook 'beyond grim' - but now come back of the newspaper stories of record early snows from the Alps to the Cascades (of the Pacific Northwest). The October cold snap in Florida beats a 150 year record (though I must suspiciously wonder who was keeping accurate modern records in 1858).

It's been really cold in Alaska this year. The glaciers are filling up. What does that mean? Apparently, definable global warming slowed or stopped a decade ago. Is that true? Why aren't we hearing about the reasons?

Yes, of course we shouldn't look to daily or even yearly figures for support for macro-climate theories. But, if that is so, why were they used to explain the significance of hurricanes and warming weather phenomena only a couple of years ago--until the temperatures dropped?

In general, I support many policies that also are backed by people alarmed by global warming. Plug-in hybrid cars. Experiments with algae as an alternate fuel. Government encouragement of solar. Certainly nuclear power and natural gas. (However, I also support "clean coal" and drilling off-shore, in Alaska and in shale to help us replace imported oil.) Yet the global warming analysis is a separate matter. It has been used to harass people and make them feel guilty for a lifestyle of abundance and to promote increased government control over people's lives. In other words, it has an element of liberal ideology about it. If the assumptions behind the global warming analysis are wrong, we risk losing common ground for policies that would promote greater energy conservation, developing new fuel sources and holding down costs for consumers. It would be nice therefore to see greater skepticism--and honesty--on this topic.

October 31, 2008

Why The Demand to Appease Israel's Enemies?

By George Gilder (taken from his weekly subscriber newsletter):

It is the view of The New York Times' Tom Friedman that the Israelis, who hold less than half of one percent of mid eastern territory, should trade land for peace with the Palestinians:

After thirty years covering this area, cataloguing every olive tree in the
Middle East, Friedman no can longer see the imperious forest of basic
facts before him in the region. G.K. Chesterton got it right. As I
paraphrase: "If it were true that the man who is trained is the man to be
trusted--if the man who saw something every day saw more and more of its
significance--the argument for expertise would be unanswerable. But the man
who sees and studies and practices something every day does not understand
more and more of its significance, but less and less."

Reflecting this blindness of expertise is the utterly conventional and
obviously fantastic consensus view of Friedman and nearly all the other
authorities on the subject. The key problem in the mid-East, they conclude
in chorus, is that Israel has too much land. Their remedy is for Israel to
give up land for the creation of yet another fanatical Moslem nation-state
in various areas of Palestine amazingly even more cramped than Israel.
Created would be a prospective nation with no identity to sustain it
beyond the Palestinian sense of grievance and its hatred of Israelis.

It is hard to imagine two more preposterous ideas so widely and
prestigiously upheld by experts. Chesterton's law is fully vindicated by
Friedman's follies.

Also supporting this pastiche of absurdities is French writer-"activist"
Bernard-Henri Levy. Author of a book on the killers of Daniel Pearl of the
Wall Street Journal and articles and essays galore on Israel and
anti-Semitism, he amazingly slips into an objectively anti-Semitic mode
himself. Believing that Israel must trade land for "peace," and give the
Palestinians a state, Levy fails to explain why, of all the nations of the
world, the only one not permitted to command a defensible territory,
capture the staging areas of invaders, or exclude immigrants devoted to
their destruction are Israel's Jews.

By contrast to Israel, the Palestinians are surrounded on all sides by
spacious and compatible Arab countries of whom they theoretically could
become citizens. Why not the East Bank? That's Jordan, where 100 thousand
Palestinians voluntarily fled during the 1967 war? As David Pryce-Jones
witnessed at the time on the Allenby bridge, "Fear did not seem to be the
motivation. These people had not seen a single Israeli soldier....Something
in the culture more powerful than either self-interest or common sense was
at work."

A Moslem Arab state from time to time sustained by Israel and created in
part as a home for the Palestinians, Jordan held the West Bank until King
Hussain's treacherous 1967 invasion and shelling of Jerusalem. Jordan
retains a far more compelling obligation to these people than Israel does.
In the 1980s, Palestinians taking refuge in Jordan did attempt to
overthrow the Jordanian government. So the Jordan solution may take some
work, but it is surely more practical than the seawater solution favored
by the Palestinians.

Should the Palestinians shun Jordan, perhaps they would prefer the Soviet
Jihad state of Syria, which in its guise as "Greater Syria" stretches its
reptilian tentacles throughout the region, including nearby Lebanon.
Moreover, Egypt is contiguous with Gaza and could easily absorb the Gazan
Palestinians. It is outlandish to say that, because of some democratic
nicety interpreted tendentiously by the U.N., Israel must commit effective
suicide by giving citizenship and equal voting rights to 4.5 million
anti-Semite enemies who want to kill them.

Yet Jeffrey Goldberg of the Atlantic, in a helpful piece called "Is Israel
Finished?" reports that accepting this line of democratic thought are not
only leading Israeli writers such as the prizewinning Amos Oz and my own
favorite, the eloquent Edward Grossman, but also the then incumbent prime
minister Ehud Olmert himself. Grossman's waffles may be understandable
because of the loss of his son Uri during the Lebanon War in 2006. But
Olmert and his allies had no excuse. Nonetheless, this former mayor of
Jerusalem nominally dedicated himself to removing the some 400 thousand
Jewish settlers in the West Bank and Eastern Jerusalem. Goldberg's article
justifies this surrender by suggesting that, together with the demographic
trend, the West Bank settlements are "a castastrophe." Echoing Jimmy
Carter's ingenuous view, Goldberg even raises fears that "Israel will
become a state like pre-Mandela South Africa, in which the minority ruled
the majority."

Clinching the argument, Goldberg writes: "If the Arabs of the West Bank
and Gaza were given the vote, then Israel, a country whose fundamental
purpose has been to serve as a refuge for persecuted Jews [where they
could live as a majority], would disappear, to be replaced by an
Arab-dominated 'binational' state."

This is a democratic ideology that accords no significance to the prospect
that an Arab run Israel would quickly expel all its Jews and cripple its
capitalist economy. Such rules of democracy would make democracy a suicide
pact.

Without a functioning and legally protected capitalist system, democracies
swiftly sink into ochlocracies, ruled by mobs. Without the independent
private sources of power imparted by free businesses, unbiased courts, and
other institutions of economic order, any democracy becomes a despotism
ruled by any tribe of thug politicians that manage to gain control. If
they have oil or foreign aid they may stay in power for decades. The
failure of leading Israeli intellectuals and politicians to comprehend
this reality is far more portentous than any supposed demographic trend.

In stark terms, Israel and Palestine raise the issue not only of the
prerequisites of viable democracy but also of the nature of capitalist
wealth. Are entrepreneurs, in Israel and around the world, chiefly givers
and benefactors, or are they predators and exploiters? Should policy focus
on fostering economic growth for all or on closing "gaps" between rich and
poor? Should it seek to enable an economic spearhead of excellence and
creativity or to dispossess the successful to subsidize the wretched of
the earth? Clutching their Fanon and their Koran, their Howard Zinn and
their Noam Chomsky, the ersatz voices of the "wretched of the earth"
punctuate their claims by a flaunted fist of hate, a clenched mind of
murder. Does Israel owe anything at all to such people?

To many observers--in the army of the left--it is obvious that Israeli
wealth causes Palestinian misery. How could it be otherwise? Jews have
long been paragons of capitalist wealth. Capitalist wealth, as
Pierre-Joseph Proudhon put it in regard to "property," is "theft." Karl
Marx was said to have shaped his opposition to property rights and his
Jewish self-hatred, by reading Proudhon, who in anti-Semitic virulence,
exceeded even Marx. In an 1883 diary, Proudhon declared that, "The Jew is
the enemy of mankind. This race must be sent to Asia or eliminated." This
fits well with Osama Bin Laden's view that warping the entire U.S. economy
and its global impact has been the effects of Jewish usury.

History, however, favors the view that poverty springs chiefly from envy
and hatred of excellence--from class war Marxism, anti-Semitism, and
cleptocratic madness. It stems from the belief that wealth inheres in
things and material resources that can be seized and redistributed, rather
than in human minds and creations that thrive only in peace and freedom.
In particular, the immiseration of the Middle East stems chiefly from the
covetous and crippling idea among Arabs that Israel's wealth is not only
the source of their humiliation but also the cause of their poverty.

Most of the world, even many citizens of Israel itself, want to muddle
these issues. The favored answer to all categorical pronouncements is:
"All of the above." Democracy, equality, multicultural kumbaya, Sharia
law, gay marriage, capitalism and freedom, the children of coddled West
want it all in a cornucopian cocktail party of inebriated contradictions,
from green austerity to entitled affluence. They mix nominal political
support for Israel with celebration of Palestinian voters who elect and
applaud anti-Semite terrorists. They match a devout belief in abortion
with fears of demographic disaster in Israel, and with continual bows of
political reverence toward an ever-diminishing complement of children.
They combine opposition to nuclear weapons and defense spending with
demands for American intervention everywhere the U.S. has no conceivable
national interest, from Burma to Tibet. They oppose nuclear proliferation
while urging US nuclear disarmament that hugely enhances the incentives
for secret nuclear programs. Without peremptory US nuclear superiority a
small complement of nukes can confer global dominance and make it
impossible for the US to defend Israel or anyone else.

The Israel test forces a remorseless realism. It disallows all the bumper
sticker contradictions of pacifistic bellicosity. Either the world,
principally the U.S., makes the sacrifices to support Israel or Israel,
one way or another, will be destroyed. There are no other realistic
choices. And if Israel is destroyed, capitalist Europe will likely die as
well, and America, as the epitome of productive and creative capitalism,
spurred by Jews, will be in jeopardy.

"Mark My Words": Is War With Iran Hiding Behind the Election?

iran%20missile-1.jpg
A recent missile test in Iran


At the top of the list of under-explored issues in the 2008 presidential campaign, place this one: war between Iran and Israel. It is the potential hot subject of the next presidential administration, but there is a strange silence about it. Tom Friedman of The New York Times would have us believe that the Iranian government is on the skids because of the falling price of oil and the mullah's managerial incompetence. But the Teheran theocrats have failed to conform to such wishful analyses in the past and there is little reason to think anything has changed.
 
A more likely prospect is increased belligerence in coming months from an Iranian regime that is looking for outside opportunities to shore up domestic support. Iran is building nuclear bombs and rockets to deliver them.
 
Consider this now in the context of the campaign. Media and politicians have been rather quick to pass over Senator Joe Biden's remarks to Seattle campaign donors recently, remarks that quite plainly predict a coming foreign policy crisis. The Democratic vice presidential nominee, who is privy to top secret national security intelligence, concluded his talk with the observation, "I probably shouldn't have said all this because it dawned on me that the press is here."

But he had just said earlier, "Mark my words." So, before the campaign ends, let's mark them.
 
It has long been rumored that Israel will not allow Iran to gain the weapons and delivery system to attack Israel. First, Israel will make a pre-emptive attack on Iran's nuclear facilities.
 
In the event of an attack the United States surely will back Israel logistically and we might well join the fight directly.  After all, Iran repeatedly vows to eradicate Israel and bring down the U.S. It funds terrorist groups like Hezbollah in Lebanon and Sadrites in Iraq.

Once the American election is over and the domestic political scene in Israel calms down (after parliamentary elections in late winter) an attack will become timely. Israelis certainly are capable and have the will to make a preemptive strike, as they did in 1981 against the Osiraq nuclear reactor in Saddam Hussein's Iraq.

Strong statements of general backing for Israel suggest that both presidential nominees are prepared to give more specific support to an Israeli attack when it happens. Both may have made private commitments to that effect. But right now neither candidate wants to talk about the subject. McCain may not want to sound like a warmonger and Obama would be afraid of disillusioning his Left wing base--the peace folk who initially rallied to him because of his steadfast opposition to the American war in Iraq.

Israel's actual plans, and American possible actions in connection with them, are all highly classified, of course. Outside the Bush Administration, only the presidential candidates--and key members of Congress, such as Biden, who chairs the Senate Committee on Foreign Relations --would have been briefed. These people know what others can only suspect and wonder about.

Biden, with such knowledge, warned in Seattle,  "Mark my words. It will not be six months before the world tests Barack Obama like they did Jack Kennedy. Remember I said it standing here if you don't remember anything else I said. Watch, we're going to have an international crisis, a generated crisis, to test the mettle of this guy."

Biden also said that he expects that the Obama Administration's handling of the unnamed crisis will be unpopular with many people. "Because it's not gonna be apparent initially, it's not gonna be apparent that we're right...Gird your loins," he told the donors, "Because this guy (Obama) has it. But he's gonna need your help. Because I promise you, you all are gonna be sitting here a year from now going, 'Oh, my God, why are they there in the polls? Why is the polling so down? Why is this thing so tough?

"There are gonna be a lot of you who want to go, 'Whoa, wait a minute, yo, whoa, whoa, I don't know about that decision.' Because if you think the decision is sound when they're made...they're not likely to be a popular as they are sound. Because if they're popular, they're probably not sound."

Former Secretary of State Madeleine Albright tried to spin the Biden effusion as just a commonplace notation that a new leader must always expect to be tested by events. Obama, the brilliant rhetorician, dismissed it as a "rhetorical flourish."

Instead, it sounds like someone speaking a kind of code that he half-wants to be understood and half-wants not to be understood. It also sounds like the Joe Biden who likes to demonstrate his insider status and who notoriously lacks a filter. Slade Gorton of Washington State has described his former Senate colleague as "a politician who never lets a vagrant thought enter his head and remain unspoken."

Other possible scenarios that have been derived from Biden's words include an altercation with Russia, perhaps over U.S. sponsorship of NATO membership for Georgia and Ukraine. Some people imagine an Al Qaeda attack that would cause Obama to invade Pakistan, as in the primaries he suggested he might do (never mind that Pakistan is an ally that fervently does not want our troops.) But, in the case of Eastern Europe, the scenario doesn't rise to the high drama implied by Biden's fulminations, and in the case of Pakistan, an invasion any time soon seems unlikely.

In contrast, prospects of an Israeli attack on Iran have been discussed for a long time and have achieved a level of expectation, not just conjecture. Former U.N. ambassador John Bolton last summer predicted an Israeli attack soon after the American elections are over. (I think that the Israelis would want a new U.S. president fully resident in the White House so that he would have to take responsibility.)
 
Despite years of diplomacy by many countries and international organizations, efforts to restrain the Iranians have failed. The International Atomic Energy Agency of the United Nations (IAEA) has been rebuffed repeatedly. The defiant Iranian theocracy has virtually asked for attack.
 
Still, such an attack, even if successful, is bound to have huge repercussions. An open declaration of war seems probable. Iran has said it will urge its terrorist surrogates to rise up in the Middle East and to assault the U.S. worldwide and on our own territory. Iran's own naval and para-military units have the capacity to threaten shipping lanes around the Straits of Hormuz through which most of the world's oil passes. Oil prices could rocket for a while.
 
Other nations in the region, history shows, will profess outrage at Israeli and U.S. actions, even though nearly all will be relieved that Iran's atomic threat has been removed. The United Nations will condemn Israel. The U.S. will become even more unpopular in the "Arab street," including among some of our allies (not all) in Iraq.

But if the issue of a possibly impending war with iran is absent in the presidential campaign, there is precedence for such avoidance. There seems to be a hole in American awareness at election time where foreign policy ought to be. That was true in 2000 when terrorism was barely mentioned, if at all--eleven months before the 9/11 assaults. Going back, Pearl Harbor arrived a bit more than a year after FDR won re-election to a third term, pledging to keep "our boys" out of war. And in 1916 Woodrow Wilson was re-elected with the slogan, "He Kept Us Out of War," only five months before America entered World War I. We may be at such a point again.

But will anyone even remember this "crisis" issue omission when and if Biden's prediction comes true and a war with Iran "tests" a newly elected Obama?


 
** Bruce Chapman, president of Discovery Institute, was U.S. ambassador to the United Nations Organizations in Vienna under President Reagan.

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