The Obama strategy appears to be a blitzkrieg of policy proposals to swamp a weakened and beleaguered Republican party. This places a premium on uniting around key principles and messages to survive the onslaught. So far, they have been handed three easy opportunities, and the good news is they successfully found their voice.
In the debate surrounding the stimulus bill, Republicans found their voice effectively. Essentially, they said “stimulus, yes; waste and political payoffs in the name of stimulus, no.” In the same way, the Obama budget has provided another opportunity to make the case for pro-growth policies and small, contained government by pointing out the obvious: the Obama budget promises irresponsible, risky trillion dollar deficits as far as the eye can see with NO spending restraint whatsoever. Finally, the disgraceful, earmark-laden omnibus spending bill should be an anathema to all Republicans (and, unfortunately, is not even though the Washington Post today reported that $10 million will go to a disgraced Democratic lobbying firm that specialized in – you guessed it – earmarks) and makes hypocrisy of Obama’s promises to clean up Washington. Republicans can just say no.
But Republicans will not be successful simply saying “no” – they need a pro-active, alternative agenda. In the near-term, there are two key issues confronting the country on which the Republicans are in disarray – fixing the financial system and health care reform.
The financial crisis is the greatest threat to the U.S. economy. The right thing to do is to apply the principles of responsibility and competition, and the lessons of history to get this right. The most important lesson is that failed, insolvent banks cannot be permitted to continue to operate using taxpayer subsidies. Letting these “zombies” walk the financial system was at the heart of the savings and loan crisis and the slow Japanese recovery from its financial crisis. These institutions should be taken over, their management and shareholders made to suffer the consequences of their failure, and the assets re-sold to private sector entities as fast as is feasible. That’s good policy: discipline failure, promote real competition, and use assets effectively in the private sector. Yes, it will be costly – but not more costly than continued propping up of failed big banks. And, yes, it will raise the specter of “nationalization,” but it is really about re-allocating financial assets in the private sector. The bottom line: no more taxpayer resources without real use of discipline and effective workouts.
Going forward, the big policy issue will be health care. I write this on the day that the Obama administration holds its health care reform “summit”, highlighting the importance of having a real set of principles in this area. Here, I think the most important issue is for Republicans to be for something. Too many Americans believe that Republicans just don’t care or, even worse, actually do not want Americans to have health insurance coverage. In fact, every candidate for the most recent Republican nomination presented a health care reform during the primary season, reflecting the fact that Republican voters care about the issue and candidates have thought carefully about solutions.
Indeed, Republicans want the same thing that Democrats do – a health care system that delivers lower costs, higher quality outcomes, and covers more Americans with health insurance. The differences are on how to achieve these goals. This leads to four principles:
- Republicans should focus on the facts: the problem is cost. Health care costs too much (especially for what we get in outcomes) and is the reason that insurance is so expensive. So, costs first.
- A solid health care reform will generate cost savings, and these can then be plowed back into the system to expand coverage. Attempts at radical coverage expansion will outstrip these savings, especially at the beginning. To avoid a dangerous government expansion, it should be a requirement that any new resources raised from the private sector be devoted to expanding private insurance coverage.
- Savings will be larger, the more the reform recognizes that incentives matter. Reform should generate good economic incentives by providing portable insurance that does not interfere with the labor market, keeping hidden taxes and mandates to a minimum, and providing a business model for health care that emphasized innovation, quality and cost control.
- States have vastly different demographics, cost structures, state-level government programs, and insurance market policies. Reform should respect these state-level efforts. States understand the problems of cost and coverage, although it is very difficult for any single state to be master of its outcomes. Federal reform should support these state-level efforts wherever possible.
These are momentous times and the policies adopted will shape the economy for years to come. Republicans have the obligation and opportunity to engage vigorously in the ideas debate.
39 responses so far
1 Go Dog Go! // Mar 5, 2009 at 10:48 pm
The cost of the Republican absence from any kind of principled debate will be huge, granted. But can the GOP field real leadership in the next two months? Because that’s the window in which so many of the Dems’ proposals will be initiated, debated and voted upon. My feeling is “no.” That said, I agree that Republicans have to find an issue on which they’re able to make a stand. It just has to be based around a central tenant of conservatism in order to “seed” a revival.
2 dmt3 // Mar 6, 2009 at 6:19 am
If one of our Republican representatives can avoid using the “T” word in any sentence they utter, they may have the ability to engage in a legitimate debate and influence the outcome. There are two critical problems which any health care solution for the nation must solve: Health care costs too much and there are citizens who do not have health care. High cost affects coverage. Coverage affects cost. One of the reasons for high health care cost which is missing from your princples is lack of competition. Hospitals jealously protect their turf by lobbying and other means of preventing the establishment of other facilities that could affect their revenue stream. The phrama industry has a choke hold on the availability of drugs. Medical equipment manufacturers enter into exclusive deals with hospitals and medical centers for services (competition is just now entering the lucrative MRI business). I am sure there a host of other reasons for high costs (including malpractice insurance, and medical education tuition). These and other reasons for the high cost must be addressed and any solution must include competition. Otherwise the only viable solution will be governmenet subsidies or lack of coverage. Both of these should be anathema to Republicans Isn’t competition a free market principle? Well, lets get on the table! The exclusivity and patent laws for medecine need to be reviewed and amended to ensure that there is a balance between the manufacturers right to profit from their efforts and the need to reduce costs for the health of the nation.
3 jlloyd // Mar 6, 2009 at 6:58 am
Look – I’m all for lower health costs, but they really aren’t the problem. Yes, there are som things government can do to foster competition and lower costs (including malpractice reform), but the real reason why costs are so high is that health care is a classic inelastic demand function.In other words, demand does not change regardless of price (and ultimately, people will be willing to pay just about anything for care to save their lives). Another reason why costs are so “high” is that the health care system is so effective. People live longer, are healthier, and many diseases and conditions that crippled or killed peopple just a few years ago are now treatable or even curable. Just because we haven’t find the key to imortality doesn’t mean we don’t get good value. Can you honestly say the health care in this country is not worth paying more for than it was 30 years ago? Or 50 years ago? We pay more for lots of thins (as a total percent of our national income – not necessarily on a per unit basis). We spend more on cars than we did 50 years ago, more on computers, more on cell phones. Why? Because people want and need these things. There are three elements to health care – cost, quality, and quantity (including access). Anyone can deliver on any two of these. No one has figured out how to do all three – because there is potentially unlimited demand, and always going to be limited supply. Do we want rationing (which is only just limiting access in a political way), lower quality, higher costs? There is no free ride.
4 jlloyd // Mar 6, 2009 at 7:04 am
And promising universal access is really a lie – no country in the world has “universal” access, when you consider the rationing that occurs in nationalized systems. Waiting months or years for a needed operation is not universal access. Being denied newer drugs and treatments due to cost is not universsal access. Not having access to what we take for granted as basic diagnostic tools, such as MRI’s or CAT scans is not universal access. Neither is limiting access to specialists. The reason all the nationalized health care systems in the world do these things is to control costs, because even government budgets are limited. The only reason why cost is such an issue is BECAUSE of out-of-control government budgets. Why should it matter to anyone what you or I choose to spend on health care or anything else? It only matters when government is paying the bills.
5 jlloyd // Mar 6, 2009 at 7:13 am
What can we do to make it easier to get health insurance and lower costs somewhat? Open up insurance markets. Virtually every state has its own insurance board, which sets the requirements of insurance policies sold in that state. In addition, virtually every state has different laws regarding malpractice and liability. As a result, some states have shortages of specialists (OB/GYN for example), because the doctors cant afford the malpractice insurance. This just increases cost more. Some states require Cadillac insurance plans, which include such things as aroma therapy and chiropractic care. There is no choice for consumers in these states. One thing that the government is empowered to do under the Constitution is regulate interstate commerce. We should have uniform national laws for medical insurance and liability. People should have choices. John McCain actually suggested this, and it was a good idea, although he was utterly incapable of articulating it.
6 sinz54 // Mar 6, 2009 at 9:44 am
In Massachusetts where I live, then governor Mitt Romney signed into law a health care reform package that has covered some 95% of Massachusetts residents. And he did it WITHOUT so-called “socialized medicine.” He accomplished this with three mandates: One: No insurer can reject or drop someone, just because he has a pre-existing condition. (Thank God for that; I had to be put on dialysis this year, and without this mandate I couldn’t switch to a lower-deductible policy because of my pre-existing condition.) Two: Every Massachusetts resident is required to get coverage from some insurer, and submit proof to the state. (That eliminates young healthy people opting out of the system, leaving it to the older sick people like me, and bankrupting it.) Three: For the truly poor who cannot afford any type of private coverage, there is a last-resort government program, MassHealth. It comes with strict means testing; even Social Security payments can put you over the means test limit. So it’s really for the absolutely truly poor. And that’s it! No need for gargantuan and clumsy government “reforms.” The GOP should be proud of Romney’s achievement. We conservatives should be touting it, accomplished by a conservative Republican governor. Instead, in 2008, Romney was forced to run away from his own health care program, because the extreme right-wingers in the GOP were opposed to any government initiatives on health care whatsoever. But let’s face it, folks; in a 100% free market, there is no incentive for any insurer to have someone like me on their rolls. I’ve got kidney failure and my treatment costs over $60,000 per year. In a laissez-faire health care system, my only affordable option would be death.
7 sinz54 // Mar 6, 2009 at 9:58 am
It’s NOT just enough to have a positive alternative to the Dem proposals. We also have to get the voters to listen–the voters who voted for Obama, the voters who don’t listen to Limbaugh. And right now, they’re not listening to us because polls show that they trust Obama more than the GOP to fix America’s domestic problems. To me, Job One is regaining the public’s trust, which has been squandered in recent years. And I have a proposal for a dramatic step: Right now, all Senators and Congressmen get Government-provided health care as a perk. I propose that all Republican Senators and Congressmen voluntarily GIVE IT UP, and apply for insurance from private HMOs,just like the rest of us. Let them see what we ordinary Americans have to go through when dealing with private managed care. And this would embarrass the Dem politicians, who would still be enjoying Government-provided care, into appearing as “elitists” again.
8 HollywoodBill // Mar 6, 2009 at 10:01 am
The religious zealots discarding of Romney on shaky theological grounds should be enough reason to never listen to these revival tent Republicans again. Sinz, without getting too personal, I’m assuming your personal healthcare cost is less than 5 grand a month. Romney’s plan at least deserves more than just a cursory glance. Out of control medical costs and an influx of people not used to a medical system are a huge reason for part of CA’s financial problems. As a Republican Governor in one of the most Democratic states in the Union, Romney had a lot of potential and promise until he tried to ingratiate himself with the Agents of Intolerance.
9 sinz54 // Mar 6, 2009 at 10:47 am
HollywoodBill: My out-of-pocket costs, while still nontrivial due to all the deductibles and co-pays, are still only a tiny fraction of the total cost. Even though I had to obtain individual coverage, the Romney mandates enabled me to switch from a high-deductible low-premium private insurance policy (which had made more sense when I was younger and healthier) to Blue Cross-Blue Shield, despite my serious pre-existing condition. If I didn’t have the money to pay the premiums, then I would qualify for the MassHealth government program (with its strict means testing). But the MassHealth program, Network Health, looks and feels just like any private insurer, NOT like socialized medicine. (http://www.network-health.org/). It has a wide network of doctors and specialists; all the ones I use are included. So most folks who are forced to go with MassHealth can continue to see the same good doctors they’ve always seen. Not bad for a conservative Republican governor!
10 sinz54 // Mar 6, 2009 at 11:02 am
HollywoodBill: The GOP base wasn’t just opposed to Romney’s candidacy. They were also opposed to Romney’s health care plan, because of the mandates. But I don’t see how a laissez-faire, 100% private enterprise health care plan can work and remain solvent, unless chronically sick folks like me are denied coverage and put into hospices to die; and illegal aliens are turned away from hospitals and left to die in the streets; unless private charity can pick up the costs. Which was pretty much the way things were in 19th century in America.
11 jlloyd // Mar 6, 2009 at 11:35 am
We don’t have people dyingin the streets now – we have insurance for the poor and elderly. Health care is always going to be expensive, unless you ration it – and that means turning people away from hospitals (see what is happening in Great Britian), denying treatments, limiting access to specialists and the like. As much as we want to believe in the tooth fairy and pixie dust, there is no magical solution to this, and government control, where budgetary and political consideration take the place of medical decisions is not the answer. If we really want to make health insurance affordable, someone needs to take on the trial lawyers, as well as the state insurance boards that jack up costs. One thing government can do is have uniform national rules for insurance (this falls under regulating interstate commerce) rather than having this crazy quilt work of rules we have now. They can also develop uniform malpractice laws. And although I wouldn’t want to deny hospital care to anyone needing it, it is well past time that we protect and defend our borders and enforce our immigration laws so we tax payers, who are all struggling, don’t have to foot the bill for people who shouldn’t be here in the first place.
12 jlloyd // Mar 6, 2009 at 11:45 am
I thought it was priceless during the Presidential debates when Obama said we need to keep the current choices people have. What choices? We get our health care through whatever insurance policies our employers offer. Those plans, which are largely dependent on what the state you live in requires, are etched in stone. We do noot have a choice as to coverage (what we want or don’t want), the deductibles, copayments, and out-of pocket limits. In many cases, we don’t even have a choice of the doctors and facilities (HMo’s). We don’t have control of the premiums. The system now is nowhere near laissez faire. It is highly politicized, enormously regulated, and offers little or no opportunity for innovation, competition and choice. And its only going to get worse. see http://www.liberty-page.com/issues/healthcare/socialized.html#britain
13 gerrysh // Mar 6, 2009 at 12:43 pm
Here’s a radical strategy – TELL THE TRUTH. Health insurance costs are high because governments often mandate that policies cover crap like contraception, fertility treatments, Bob Dole’s little blue pills, etc …
14 HollywoodBill // Mar 6, 2009 at 12:48 pm
Sinz, I like the idea of federal legislators turning down their healthcare benefits and trying a healthcare program, similar to Massachusetts or some facsimile. And MA, like CA has enough loud mouthed politicians who could get the national press that is needed to publicize these actions. I might be reading too much into your situation, but overall, you sound pleased and relieved. We are coming perilously close to people dying in the streets out here with the closing of some sub par medical facilities. I still think it is possible that an outbreak of some third world scourge could happen in a melting pot region of the country and then alll will break lose. But the GOP’s old song and dance about healthcare is going to keep it out in the wildnerness for possibly more than the proverbial 40 years if something is not done.
15 jlloyd // Mar 6, 2009 at 12:51 pm
Politicians rarely tell the truth – they can get more power, privilege, money and control by hiding the truth and out-right lying. Oh – and don’t forget aroma therapy, which NY state requires. We must keep the aroma therapists happy. All the more reason to restore limited government. People are usually better able to run their own lives and make their own choices than mindless bureaucrats. It is almost like the terminator series – where the machines became self-aware and took over. Our government has become self aware and is totally out of control. It has become completely corrupted by its ability to steal our money and property (the fruits of our labor), thereby enslaving us. They pretty much do whatever they want. In many respects, both parties are as bad as the other. What is the point of having elections if both choices are bad?
16 fact based // Mar 6, 2009 at 12:53 pm
of course your sensible ideas will be branded socialist by Newt his puppet Cantor and the fox/talk radio echo chamber.
Of course the fact that the stock market is falling because the zombie banks haven’t been nationalized and that every business group advocates major reform of the healthcare system with more govt involvement doesnt penetrate their bubble. Beter to scream NO NO NO to this socialism.
And I really crack up at Cantor’s “free market solution” to the banking system : abolish mark to market accounting and replace it with something made up by the banks. If he knew anything about markets he would know that Bank of America and Citigroup are penny stocks precisely because nobody believes the accounting. Letting them put their thumb on the scale and give a new value wont change a thing. The free market is telling us what the assets are worth.
17 jlloyd // Mar 6, 2009 at 1:19 pm
Well, as an accountant, I think the so-called accounting profession has done enormous harm to the country. Ever notice how they are behind just about every crisis? Enron and Global Crossing? The S&L debacle? Fannie and Freddie? The housing and banking crisis? I am not a fan of government regulation just for the sake of it, but here is one “profession” that really needs it. They have a built-in conflict of interest, namely, that while they proport to represent the “public” (CPA = certified public accountants), they are paid by and subservient to the client. I wrote a master’s thesis on some of these problems and won’t bore you with the details, but one very sensible reform would be for the SEC to hire auditors for all publically-traded corporations, with a special levy imposed on those corporations to pay the audit fees (sort of like the gas tax and roads, without the political games). The government also should set the auditing and accounting standards. As for the mark to market rule, it actually has done an enormous amount of harm. Banks can create money – in the simplest terms, they can do this as an inverse multiple of their reserve requirements. For example, if banks are required to keep a 20% reserve ration, then they can create $500 in loans for every $100 in deposits. The mark to market rule has greatly complicated this process – as their assets are written down (and sometimes there is no standard to say what the value of certain assets really are), they are not able to loan out money, even if they have positive cash flows and are otherwise liquid. Banks actually have twice as much cash on hand today as they did one year ago. The mark to market rule was abolished by FDR and only trecently (2006/7) reinstated. It has been a complete disaster.
18 jlloyd // Mar 6, 2009 at 1:28 pm
by the way, the banks have also been hurt by short-selling, especially since regulators have been lax in enforcing naked short selling. This drives down the value of bank and other financial institution shares, further hurting their balance sheets as it ripples throught the stock markets. Someone needs to wake up and put a freeze on short-selling until we can get a handle on these problems. Speculators are literally driving down the prices of stocks on purpose to steal their value from ordinary investors. We also had a similar effect with oil prices last summer, only in reverse. One reason why the treasury dept is buying bank shares is to discourage shorting (speculators have to bet against the government then), but wouldn’t it be easier to just suspend or freeze these destructive and speculative activities?
19 fact based // Mar 6, 2009 at 2:41 pm
you’re shooting the messenger. The problem is that there weren’t MORE short sellers (most mutual funds and pension funds are restricted from shorting) so that we would have seen that the emperor had no clothes sooner. The mkt price would have reflected the fact that the books were cooked as you acknowledge.
and “as their assets are written down (and sometimes there is no standard to say what the value of certain assets really are),”
but the mkt is giving you a free market with money behind it estimate of what the assets are worth which is the reason citi et al are trading below their reported book value.
You are contradicting yourself the auditors are in cahoots with the management to cook the books so why should i trust them to value it.
And as for you example if the banks (like some small community banks) were basically making loans against their deposits we wouldnt be in the mess we’re in, The problem is they leveraged up mispriced/fictitous asset values.
To believe these guys who are saying “trust me this time we know how to value this stuff” is beyond ridiculous,
If the accounting service has done a disservice to the country then why let the banks bring in those same accountants to give a “better” value on the assets than mark to market. 12% of mortgages are late on payments, what assumptions do you think the banks will use for default rates on their bottom of the barrel subprime mortgages ?
The sooner we bite the bullet and nationalize (or choose another word) the zombie banks the better. But the american people “can’t handle the truth” of how much it will cost and there is no leadership to do it. Read krugman today.
20 jlloyd // Mar 6, 2009 at 3:08 pm
I think you are mixing up points. The auditors are in cahoots with mgt because they have a conflict of interest. Take away the conflict (by having auditors of publically traded companies paid directly by the SEC) and you would solve a lot of the problem. Also, I think having the government set the accounting and auditing standards (as is done in most other countries to good effect) would be useful. However, you are completely wrong about the mark to market rules and shorting. The m to m rules make it exceedingly easy to attack financial institution stocks, driving down their price. It really has nothing to do with the underlying value of the assets they hold. M to M rules are terribly bad in both good times and bad, since they make it easier to loan money in good times and are very deflationary in bad times. It is no accident that our banking problems began almost as soon as those rules were put into place in 2007, and in fact, it is not an accident that systemic bank failures were non-existent from 1938 (when FDR eliminated the MtoM rules) to 2007 when they were restored. Writing down loans to zero when they are still performing is silly. Again – banks actually have twicwe the cash on hand as they did a year ago, and most are experiencing positive cash flows. How would this be possible with “fictitious” or “non-existent” assets? Even if the loans default and result in forclosure, there still is an underlying asset. Real property is always worth something. As to the government running the banks, I am sure they would do just as good of a job there as they did with Freddie and Fannie.
21 fact based // Mar 6, 2009 at 5:21 pm
1. to compare the banking system of fdr to ours is ridiculous banks too deposits made loans and that was it. No 30:1 leverage no derivatives etc etc etc And glass steagall was enacted in 1933. Go back and check on bank crises since the rules for s+ls were liberalized, glass steagall was repealed, derivatives exploded and unregulated mortgage companies like countrywide developed,
2. The europeans had mark to market before us although they have very recently accepted very limited revisions
3. read david einhorn
4. their capital adequacy calculations are based on far more than cash on hand Of course you need more cash on hand, the rest of the assets on your books (like those subprime loans and your common equity) have dropped in value like a rock,
5, If you hold a mortgage security on your books and the default rate is 7% and growing and you are leveraged 30:1 you tell me what the impact should be on your balance sheet ? And using your example we know the salvage value on foreclosures is around 50%, where does that leave you if you are leveraged 30:1, The homeowner is bankrupt and he is only leveraged 5 or 10:1.
The markets are (relatively efficient) If citibank was worth more than $1 share ($5.6 bln) someone would buy the whole thing, take it private and make big bucks. Only the govt is stupid enough to plow many times that amt into the company, take a minority share and let the crazies still run the asylum.
are you really an MA in accting ?
Take a visit to the inland empire in Socal the homes are basically worthless certainly far less than 20% of the value on many of the mortgages salvage value after all expenses related to foreclosure and selling. The cost of maintenance and carry for the 18+ months it would take to generate a bid would be about 20% of the value of the mortgage.
22 fact based // Mar 6, 2009 at 5:31 pm
I’ll make this simpler for you
2005
you bought your house for 500k with 20% down you had $10k in the bank
2009
your house dropped in value 40%
your rich uncle gave you a check for $50k
would you say you are in a better position in 2009 because you have 5x as much cash on hand and the current (mark to market) value of your house relative to your mortgage is irrelevant ?
If you were a banker would you lend me money ? Would it be prudent for me to take the $50k and invest in a business or real estate ?
23 fact based // Mar 6, 2009 at 7:20 pm
jlloyd:
I didnt get a chance to read steve forbes op ed in todays wsj and realize you lifted everything from him.
That is the steve forbes that proposed a flat tax and the alternative of paying the flat tax or the old system, that no one would pay more taxes and the govt would get more tax revenues
so much for forbes
never mind
24 Chekote // Mar 6, 2009 at 8:37 pm
Everytime I see the title of this post, it angers me. It is bad enough to have Obama and the Dems setting up strawmen, but Republicans too?! The GOP has offered alternatives. They can’t do anything if the media refuses to cover their proposals.
25 fact based // Mar 6, 2009 at 9:52 pm
yup I agree:
WASHINGTON (AP) – The top Republican in the House is seizing on the latest spike in unemployment to call for a freeze on government spending and to urge President Barack Obama to veto a $410 billion spending bill.
Rep. John Boehner, R-Ohio, said the jump in unemployment to 8.1 percent and the loss of 651,000 jobs in February is a sign of a worsening recession that demands better solutions from both parties.
how to stimulate the economy ? cut public spending. It worked for Herbert Hoover why not try it again ?
26 Jason Keuter // Mar 7, 2009 at 1:04 am
I disagree: Republicans should say no to government and yes to liberty and freedom. In proposing an alternative to the Democrats plans for what government will do, it is impossible to avoid proposing an alternate GOVERNMENT PLAN.
First and foremost, Republicans really need to change the debate. Since the media frames the debate around Democratic talking points, then Republicans should stop talking to the media. A policy proposal? What can Republicans say yes to regarding in the face of the Democratic Agenda? For a start, the Republicans should call for privatization of the airwaves. What would this policy proposal do? First, it would show that the media’s pro-Democratic bias comes in part from the fact that they have no right to broadcast – the government can take away that right. No wonder the media is so biased against anti-government conservatism: the media needs government apporval to broadcast. Here is a policy proposal that would bring into sharp relief the reality of media bias and the reality of the ideology of the Democrats. Both parties would be forced to defend government approved “free” expression.
Obama, Pelosi, Reid – the left in general refuse to go on the O’Reilly Factor yet Republicans go on ABC, CBS and NBC. If conservative believe the media is biased, then BOYCOTT IT!!!! Enough Americans will want to here what Republicans have to say that they will turn to alternate media outlets. At the same time, propose legislation to privatize the airwaves. Let the Democrats defend the idea that the public needs to be protected from information and can’t think for themselves. Let the so-called internet saavy 21st century party declare that if government doesn’t regulate the TV networks, then people won’t get balanced information. Let the Democratic party declare that all Americans who watch cable (i.e. private) television are wrong in their choice of programming. Let the Democratic party have to warn against the morally insidious content of private television and thus drive a giant wedge between them and their Hollywood supporters.
27 InTheMiddle12 // Mar 7, 2009 at 5:11 am
Jason: Until the GOP acknowledges that supporting government AND liberty and freedom are NOT at odds, their numbers will continue to go down.
At a time when the markets have failed and the biggest names in business are running to government for help, whether you believe in bailouts or not, it seems a very odd time to constantly be attacking government and a new administration, who, for better or worse, are clearly trying to face the reality of the last 8 year mess they’ve inherited and generate ideas to, as is appropriate for government, address the issues that resulted.
Until the GOP puts down their kill government at all costs attitude, well, no offense, but they’ll continue to be irrelevant and lose seats all over the country.
28 InTheMiddle12 // Mar 7, 2009 at 5:20 am
jlloyd: I really like the idea of the SEC or some third party entity being an honest broker for audits, or, as my loyal friends ont he right would fear, nationalizing audit firms. I work in a consulting firm that serves nonprofits and we were closely with auditors. It’s clear they spend a lot of time generating business and in the case of large clients, work “closely” with them to maintain their fees. I have no doubt, even though 99% of auditors I’ve met are clearly ethical and want to do the right thing, that by taking the business development piece out of it, audits would be cleaner and more honest. Of course this will bring a huge backlash from the right about free markets, etc., but I believe that auditing is a function that could truly benefit from some greater regulation. It would have saved us from the mess we’re in, no doubt. And isn’t it interesting that when an audit company does a good job, eg. GM as a “going concern,” suddenly people pay attention. I think the fact the every company, from Merrill to Wachovia to all the others that are failing have never had a “going concern” tells us a whole lot about how the current auditing system is not serving any of us well, except for those that benefited from the cover ups.
29 Chekote // Mar 7, 2009 at 7:00 am
InTheMiddle. First of all, auditors’s effectiveness is limited by the fact that they based their audit on the information given to them by management. Most fraud enterprise keep two sets of books. What you constantly ignore is the fact that government is just as corruptible as any private enterprise. Government action or inaction is influenced by campaign contribution. Look at Freddie and Fannie. Look at all the contributions they made to politicians in key positions. You have to set up a completely independent body (a la Fed) or you will have the same results.
30 sinz54 // Mar 7, 2009 at 7:23 am
jlloyd: “Speculators” in short selling cannot possibly drive a stock down below its true value for very long. If a wave of speculators tried to drive down the value of Coca-Cola or Microsoft stock like the way you claim they’re driving down Citigroup, they might succeed for a couple of months. But afterward, they would not only fail, but they would incur huge losses–because every investor knows that those are solid companies and would rush to buy those stocks at cheap prices. Speculators can never drive a sound company into bankruptcy–only the company can, or the industry it represents can. The problem with Citigroup is that it deserves to be cheap, because the entire financial system is collapsing. BTW: Your attacks on anonymous “speculators” sound very much like Franklin Roosevelt’s in the 1930s. And both of you are wrong.
31 Chekote // Mar 7, 2009 at 7:32 am
At this point, the Dems have done a great job convincing people that the markets have failed. It may be better for the GOP to just get off the stage and let the Dems hang themselves on the rehashed, liberal 60s, retro policy prescriptions.
32 sinz54 // Mar 7, 2009 at 7:37 am
Chekote: There are some good *reasons* why the media–and let’s face it, most of the public too–have tuned us out. The election is OVER, remember? The voters made their choice in November already; they picked Obama. Obama is still in his honeymoon phase–he was inaugurated less than 2 months ago–and the public is sticking with him for now, according to the public opinion polls. Beyond that, the GOP lost the public’s trust on a number of issues, over a number of years. The public won’t start listening to the GOP again, until the GOP takes substantive actions to regain that trust. I proposed one dramatic way the GOP could do that, in the upcoming debate over health care. But the GOP, and many conservatives, seem to have forgotten that just four months ago, the voters already rejected them and the proposals they made. The voters clearly wanted something different. So far, the GOP hasn’t shown it can do anything different.
33 sinz54 // Mar 7, 2009 at 7:47 am
Jason Keuter sez: ‘For a start, the Republicans should call for privatization of the airwaves.” Evidently you are unaware that social conservatives *within the GOP* have been calling for *more* regulation of the broadcast networks. Specifically, they want the FCC to reinstitute the “Family Hour,” which would ban programming from 8 to 9 PM that involves adult themes. Surf over to the website of Brent Bozell’s “Parents’ Television Council,” or read his columns on Townhall.com. The Parents’ Television Council has been issuing one petition after another to the FCC and the courts, to urge them to crack down on nudity and other adult material on the broadcast networks. Your libertarian ideas not only won’t fix the economic crisis we’re in now, but they also conflict with the social conservatives’ drive to regulate the media to promote “family values.”
34 fact based // Mar 7, 2009 at 9:30 am
Jason I agree with unemployment+ underemployment at 15% headed to 20% the repubs should concentrate on rules concerning “the media” because the left wing bias doesnt let the views of the right (like sean, rush, beck ,levin etc etc etc etc) get out to the public.
Go for it I am sure every family in america going over their budgets and bills on the kitchen table after dinner is asking why govt cant fix the “bias of the msm”.
the more you stay in the bubble the more you will be in the wilderness
enjoy it, I will
oh and btw check the ratings for desperate housewives,mtv and other racy fare in the bible belt
35 sinz54 // Mar 7, 2009 at 9:42 am
InTheMiddle12 & Jlloyd: An example of what you’re talking about is the Defense Contract Audit Agency (DCAA). These are the “guys with green eyeshades” who oversee auditing of defense contracts, and perform accounting services to all government agencies doing defense-related procurement. In the defense industry, known for pork and questionable practices, DCAA has kept its nose clean. Every project manager treats DCAA auditors with a healthy respect–DCAA can shut down even the largest defense projects if they discovered accounting or contract fraud. And by law, DCAA is required to make its own internal audits publicly accessible for peer review (you can download them yourself from DCAA’s website). So there is an example of a long-standing successful government auditing function.
36 sinz54 // Mar 7, 2009 at 10:03 am
fact based: Where these “zombie” banks are concerned, both Bush and Obama are proceeding down the same path as Japan did in the 1990s: Outright nationalization is politically incorrect, so let’s just take an equity stake in the banks instead, and let them continue to zombie around. That failed in Japan, and contributed to their long economic malaise. The banking crisis won’t be solved until the zombies are either killed off, merged into successful banks, or nationalized. If I remember correctly, that’s how the S&L crisis was handled–and that was successful.
37 fact based // Mar 7, 2009 at 2:38 pm
sinz54 you are totally correct now listen to newt rush sean and cantor and the rest of their puppets rant about “socialism” and you tell me how much bipartisan support he will get to do the nationalization
Let lindsey graham, greenspan, newt , cantor and a bunch of other repubs get on a podium with obama and the dem leadership and declare that no matter how unpleasant nationalization seems the alternatives are far worse
unfortunately till the above happens we wont move forward
38 Go Dog Go! // Mar 8, 2009 at 1:35 am
The notion that Republicans should wait until Dems hang themselves is just as dumb as hoping the President fails. Our nation could fail — actually FAIL — if we (all of us) don’t get it right. Nothing could be more cynical than hoping our country falls into disaster just so conservatism can play white knight and take over again. I think being “the party of no” is the functional equivalent of waiting for failure and it’s an untenable position for our country. To me, the real “Anti-Americans” are those who would see us fail for their own power. Is this what the GOP wants to be? A lot of conservatives are wondering…
39 dmt3 // Mar 8, 2009 at 3:07 am
sinz54: Actually, DCAA has had their own troubles lately (http://www.gao.gov/products/GAO-08-993T). Those issues notwithstanding, you are correct DCAA is generally respected by industry because of the due diligence manner in which they perform their job. I know my company sits up and takes notice even just for a DCAA desk audit.
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