Monday, March 30, 2009

No good deed goes unpunished

Last week, on Israel's annual Good Deeds Day, a youth orchestra from Jenin, in the West Bank, played a concert for a group of Holocaust survivors in a suburb of Tel Aviv. The symbolism was powerful, although the actual message was much more muddied and complex: None of the children spoke Hebrew, the elderly survivors spoke no Arabic, and apparently the children knew almost nothing of the Holocaust. (I assume as well that the survivors know little or nothing of the Palestinian version of Israel's birth.) Still, it was a nice gesture, a ray of light.

A gesture that has now been condemned by political "leaders" in the refugee camp from where the children come.

Makes you think that if we could get the adults out of the way....

Sunday, March 29, 2009

Bankruptcy for GM?

In today's NY Times Magazine, Matt Bai has the best argument I've seen for letting GM go into bankruptcy. The heart of his argument comes in response to the shibboleth that no one would buy a car (or an extended warranty) from a company in Chapter 11:
This argument underscores the deeper problem afflicting G.M. over a period of decades now — not simply soaring labor costs or global competition but also an inability to grasp underlying changes in American culture. There probably was a time when a well-publicized bankruptcy would, in fact, have destroyed the viability of a brand. But in the 20 years since Silicon Valley start-ups began transforming the workplace, younger Americans — in other words, those who now make up the heart of the consumer market — have largely dispensed with the mythology of the infallible institution. Transparency and reinvention, rather than stability and regality, are the more valued assets in an economy where entrepreneurs expect to stumble more often than they succeed and where employees expect to have to change jobs (if not careers) multiple times.
Which led me to think about United Airlines, which went into and came out of bankruptcy intact. Indeed, almost all major US airlines (including US Airlines) have done so. Now it's true that buying an airline ticket is not like buying a car: for one thing it's cheaper, and even if you--like the lovely Diane and me--are addicted to buying well in advance to save money--that ticket is not something you expect to keep and use for years. On the other hand, airlines take you really high in the sky and transport you really fast in a extremely inhospitable atmosphere, frequently over very remote places. (If you think the United States is thickly settled, take a plane from coast to coast and gaze down at the vast expanses of the nation that seem not only to be uninhabited, but uninhabitable.)

So maybe we have matured to the point where the public would view Chapter 11 as a sign of stability, not ultimate failure. Would bankruptcy be cheaper than a government bailout? That's for better minds than mine.

Thursday, March 26, 2009

A few thoughts on the Middle East

This post is occasioned by my friend Leanderthal, the Lighthouse Keeper. You can find his blog here.

Lee first came to my attention with a comment he posted about some of my thoughts on Israel. He is very concerned about war and peace in the Middle East (as we all should be), and particularly by the influence he sees in what he and others call the Israel Lobby. More particularly, he is concerned that in his view the Israel Lobby has a lock on American policy toward the region, preventing the United States from staking out any new position. That's a valid point.

What is the "Israel Lobby?" Not surprisingly, it is defined by its critics. It's centerpiece is AIPAC, the American Israel Public Affairs Committee. AIPAC doesn't make any bones about its stance: go to its website and you'll see that it bills itself as "America's Pro-Israel Lobby." Another part of what is often considered the Israel Lobby, although perhaps not so strident as AIPAC is the Conference of Presidents of Major Jewish Organizations. (I can't help but wonder if anyone has been turned down for membership, because he or she is the president of a minor Jewish organization.) Then there is a less formal network of intellectuals and pundits (the terms may be partially interchangeable) and other machers. They are, of course, allied with many members of Congress, and have had the ear of vital members of all administrations as well.

One thing that ought to be noted is that most of those who raise alarums about the Israel Lobby oppose American policy in the Middle East more than they care about those who speak for Israel; I don't place Leanderthal in that group, but it would be fallacious to deny that they exist. The real objection of such people is not so much the Israel Lobby as its effectiveness. In the end, many of them are not friends of Israel.

Let me hasten to make clear that no one need be a friend of Israel to be a responsible participant in the debate over Middle East policy, although I have trouble taking seriously those who wish for the elimination of Israel from the list of the world's nations except, perhaps, as part of a very long-range hope that someday Israelis and Palestinians will freely and peacefully choose to be part of a single state. I don't happen to think that is likely to happen, ever (the dissolution of the Netherlands into what is now that country and Belgium, in 1830, was over issues not nearly as deep as those that divide Palestinians and Israelis, and I haven't heard calls for re-unification of the Low Countries), but one could make an intellectually respectable argument for it.

I should also note that debate over the role of the Israel Lobby, and the making of American policy, are perfectly legitimate topics. Indeed, American Jews debate them fiercely. Check out the Israel Policy Forum and the writings of blogger M.J. Rosenberg, who frequently differ with and often vociferously criticize the doings of the lobby. I have also disagreed frequently with the chauvinistic and unthinking attitude of some of Israel's more vociferous supporters.

But here's the thing: Right now, how much can US policy change? Don't the realities on the ground trump the desire for a bold new direction and push a debate about how Israel tries to affect American policy into the background?

For many years, I would daydream about what I would say to Israelis and Palestinians if I were the occupant of the Oval Office. As the first Jewish president, I would have some extra weight with the Israeli prime minister, and I would use it to tell him or her a few home truths. I would say that the time for settlements in the West Bank had passed, and that the time to remove them had arrived. I would tell the prime minister that the Palestinians have to get a state that pretty much runs along the borders of the West Bank in 1967, artificial as those were. For the settlers, I would suggest cash incentives and land--to the extent that a tiny state like Israel could find some--to induce them to move. For those who refused, I would advise telling them that, from a certain date a few years hence, they could live under Palestinian rule. I would make clear that Israel has to treat its Arab citizens the same way that it treats its Jewish ones. To the Palestinian prime minister--undoubtedly suspicious of this Jew in the White House--I would offer friendship and firm support for a Palestinian state. But I would tell him (it is hardly likely to be a woman at any time in the near future) that he had to suppress the violent elements in the Palestinian polity. No peace deal will work if people are firing rockets into Israel. And those who are still refugees in Lebanon, Syria and Jordan more than sixty years after the division of the British mandate have to give up the hope of return. Perfect is the enemy of good enough. Half a loaf is better than none, and so is half a land.

Would this frank talk prove the key to peace? Questionable at any time. (You may note that my home truths did not include Jerusalem, about which I have some ideas, but which is the hardest nut of all to crack.) But now? For the present, at least, my ideas are those of a dreamer at best, or maybe a crackpot. Given what happened in Gaza when Israel abandoned it, who could expect the Israelis to give unfettered domain in the West Bank to the Palestinians. Given the actions of Israeli settlers and police in the West Bank, how long a road must be traveled be before Palestinians find enough hope, let alone trust, to live in peace with their neighbors? Yet how can we expect Israel to give up security in the hope of peace? And all that is without regard to the recent fighting in Gaza. Given the power of the rejectionists of Hamas, Hezbollah and the right wing in Israel, who can envision a stable peace?

In the Middle East today, the parties, with the U.S. as the essential intermediary, need to devise the first small steps toward an ultimate accord. That will entail a complex, difficult and probably slow process that needs ingenuity and much patience.

But beside that, debates over the Israel Lobby seem like a distraction.

Monday, March 23, 2009

If you're so smart, why aren't we rich?

I'm no economist, but the Treasury's new plan looks like a reasonable approach to repairing the financial system. Yes, it is in many respects a re-run of the Bush administration's original proposal. And, yes, taxpayers will be subsidizing the same financial institutions that got us into this fix. But what else are we going to do? I don't see anyone proposing that we create a whole new banking system. Would nationalization--which is probably the way I would go were I in the Oval Office--really create a new group of banks? Or would it reshuffle the old ones?

What does bother me is not so much the idea of public-private partnerships or low interest loans to investors, but the administration's unwillingness to tell Wall Street that this is a new day. The AIG bonuses, tiny as they were compared to the amount that the company has received from us taxpayers, showed that the old culture remains all too intact. If we are to make basic, long-term progress, that needs to change. The people in charge of banks, hedge funds, stock brokerages and insurance companies need to learn an old truth: No one is irreplaceable.

Bernie's not so different from the rest of us

Thanks to for this one.

In case you haven't been to TPM, it seems that before Bernie Madoff's plea, the US Attorney's office for the Southern District of New York sent the judge a collection of emails from his victims. (Given that the US Attorney's office knew that the sentencing would not be that day, it's not clear what the purpose of forwarding the emails was.) You can find the cover letter here, with the emails attached.

Now, here's the reason for posting this: go to Page 36 of the document and read the email there.

See, Bernie really isn't all that different from you and me. Well, not in one respect, anyway.

Sunday, March 22, 2009

Can you spot the howler?

Today, we're starting an occasional challenge: to spot the howler in a passage from a book or article. The answer will be published in a few days or perhaps a week.

Our first howler comes from Scott Turow's Ordinary Heroes. The woman referred to is a young woman in the liberate part of northern France, in October 1944. See if you can spot the howler. (Hint: this is a double howler; something Turow intended to give his work verisimilitude that was actually wrong.)
"The C rations are terrible," she said. "They are the best thing the American Army brought with them." She actually hugged her green pack of Luckys to her breast. "In Vichy, the women were banned from buying cigarettes altogether. Martin says that is why I had no choice but to join the resistance." She laughed at herself.
Can you spot the howler? If you think you have, post a comment below to tell us what it is. If your idea agrees with a prior comment, feel free to say so. There's no point in being different and wrong! All correct answers will result in a glow of satisfaction.

The President's interview

I watched President Obama's interview on 60 Minutes tonight. Nothing especially new in it, but I for one was reassured by his calm, and I wonder if that was not the main purpose of the appearance.

Mr. Obama's repeated declarations that he is the one finally responsible are heartening, given his predecessor's refusal to accept responsibility for anything, but sadly they are also made necessary by the lack of confidence that so many are expressing. In the last few weeks, Congressional Republicans seem to have found new energy; clearly, they believe they are getting traction with their negative campaign. Too little attention has been paid, as yet, to how much of that campaign, in addition to its negativity without any plan for the future, relies on the American people having such a poor collective remedy that we do not remember how much of what they now inveigh against were articles of Republican faith just a few months ago.

Regular readers will know that this page has been critical of Treasury Secretary Timothy Geithner, and has questioned whether he can survive (or should). But I'm going to go out on a limb and suggest that a year from now, while we are certainly not going to be in a time of prosperity--or even, perhaps, on the clear road back to good times--the American people will have accepted Mr. Obama's policy prescriptions and the Republicans will be seen as nothing more than a doomsday chorus.

Thursday, March 19, 2009

Good news

Most of the people who routinely complain that the media concentrate on bad news will probably consider this more of the same, but in a step forward the state of New Mexico has abolished capital punishment. Gov. Bill Richardson, who has supported the death penalty in the past, signed a bill establishing life-without-parole as the state's most severe punishment.

Civilization advances slowly and with halting steps.

Borrowed time?

The Times joins the list of those questioning whether Treasury Secretary Tim Geithner can long endure.

From the article: "Fair or not, questions about why Mr. Geithner did not know sooner about the A.I.G. bonuses and act to stop them threaten to overwhelm his achievements and undermine Mr. Obama’s overall economic agenda."

What are the Secretary's achievements? Either because they have been slim, or hard to describe, or have not yet come to fruition, or because neither Treasury or the White House have been effective in getting them out to the people, they are hard to discern. That needs to change.

The Treasury Secretary's political weight needs to be heavy if the administration is going to get us out of our plight on its terms. Remember a few months ago, when Hank Paulson (Hank Paulson!) seemed to be running the country? Yes, I know, in those days of yore the Oval Office was for all intents and purposes vacant, but even a strong President needs a strong lieutenant at the Treasury. President Obama can't afford to spend his political capital on building up Tim Geithner's credibility; the Secretary will have to do that for himself. We need leadership, and not just from the President. If Mr. Geithner is not going to be an asset, he needs to get out of the way.

(And this from someone who paled at the thought of Larry Summers as Treasury Secretary in the Obama administration.)

Wednesday, March 18, 2009

This is the Army

I don't know if President Obama reads the letters to the editor in The New York Times, but I hope that at least someone in the West Wing saw today's paper.

Wever Weed, of Long Lake, Minnesota: " Memo to A.I.G. bonus-seekers: Your prima donna days are over; you are on America’s team now, and you are expendable."

Paulette Altmeier, of Cupertino, California: "President Obama may not realize it yet, but his Katrina moment has arrived. "

The phrase "America's team," caught my eyes, and reminded me of what Irving Berlin wrote:

This is the Army Mr. Brown
You and your baby went to town.
She had you worried, but this is war,
And she won't worry you any more.

We haven't seen that spirit--the idea that this is a new day in which the old worries are recognized to be trivial, the old values will no longer serve, that we're all engaged in a national effort that will mean sacrifice from those of us who still have something left. The President has expressed something like that in his speeches, but he has not, at least so far, turned that into a philosophy that animates the response of the executive branch, much less the nation, to the economic crisis.

Perhaps we should not expect so much of a President who has been in office for only two months, but time is short. As that letter writer said, this is (at least potentially) Barack Obama's Katrina moment.

Tuesday, March 17, 2009

What we lose

Dan Barry, on the demise of the Seattle P0st-Intelligencer, showing us what we lose when a newspaper dies.

No Bozos

I first thought of writing this post when I saw a headline that the creator of Bozo had died. But Alan W. Livingston, who left this mortal coil on March 13th at age 91, was no Bozo.

A short sketch of his career: In 1956, he had the idea for a series of children's records that came accompanied by storybooks. One of them was Bozo at the Circus, which was the clown's start. It sold more than a million copies.

A few years later, as president of Capitol records, Livingston signed Frank Sinatra, whose career was in eclipse, and paired him with Nelson Riddle. Some of the great records of the '50's and '60's came out of that partnership. In the mid-50's he left Capitol to go to NBC, where he put together a western called Bonanza. (His brother, songwriter Jay Livingston, co-wrote the famous theme song).

Oh, and then he went back to Capitol where, in 1963, he reversed the decision of others in the company and decided to releas a record called "I Want to Hold Your Hand," by a little-known group called the Beatles.

Now that's a career!

The power to tax is the power to destroy

So wrote Justice Holmes.

Now some in Congress are talking about taxing the AIG bonuses at 100%. Unfortunately, that is almost surely unconstitutional. To begin with, it would amount to a bill of attainder--an ancient practice of punishing one or more individuals in a defined group without due process that is proscribed by the Constitution. Also the ex post facto clause, which forbids punishment for acts that were legal when committed. And there may be others as well.

Nice try. No cigar.

They pushed the company over a cliff, and now...

The often colorful Chuck Grassley (R.Ind.) suggests that AIG executives should either resign or commit seppuku (ritual suicide).

The public is justifiably angry, but isn't that just a bit over the top?

Monday, March 16, 2009

More AIG

Robert Reich on the argument that the AIG bonuses are necessary to retain talented executives: "And any mention of the word 'talent' in the same sentence as 'AIG' or 'credit default swaps' would be laughable if laughing weren't already so expensive."

Reich also points out that the argument that the company is contractually-obligated to pay the bonuses rings false because, had the company gone into bankruptcy, as it would have without the government handout, err, bailout, claims for bonuses would have come behind those of secured creditors--which is to say they would have been wiped out--and that the people now feeding at the trough would have been out on the street.

Reich concludes:
But if our very own Secretary of the Treasury doesn't even learn of the bonuses until months after AIG has decided to pay them, and cannot make stick his decision that they should not be paid, AIG is not even accountable to the government. That means AIG's executives -- using $170 billion of our money, so far -- are accountable to no one.
* * * *

On a related topic: Was Larry Summers' broadside at AIG on George Stephanopolous' show yesterday aimed at Tim Geithner as much as at the company? Is Summers setting himself up to be the next Treasury Secretary, when the President decides that Geithner is not ready for prime time? (He sure hasn't looked it so far.)

Actual good news

The voters of El Salvador have elected Mauricio Funes, candidate of the leftist FMLN, as their new president. Now, I don't know anything about President-Elect Funes or the details of his politics, but this is good news, because (a) the race was a close one; Funes had a big lead, but the party of the Right, ARENA, had the money and clout with the establishment, slammed Funes as a tool of Hugo Chavez and gained much ground; (b) FMLN was asserting that if the race was close, ARENA would engage in fraud and prevent Funes from winning; (c) the margin was, apparently, around 51-49 percent and (d) it sounds like no one is making noises about nullifying the election results.

In a nation like El Salvador, a peaceful change of government is an important and heartening step.

Sunday, March 15, 2009

Just say no!

You have undoubtedly heard that AIG is taking millions of taxpayer dollars (it has none of its own) to pay millions in bonuses to executives in its Financial Products division. This relatively small part of the company is mainly responsible for the company getting into trouble (that and upper management's blindness or willingness to look the other way while the people in FP drove AIG under).

The early reports said that $100 to $170 million was to be paid, but the WSJ says a whopping $450 million.

Various sources reported that Secretary Geithner tried to stanch the bonuses with a phone call, but was unsuccessful. Worse, the CEO is the guy that Treasury put in when we (that is, the American people) took an 80% stake in the company. The excuse for this is that the bonuses are required by contract.

Let me tell you that if I had an 80% stake in a company and the guy running the place told me that he couldn't stop paying those bonuses, he'd be on the street so fast that his head would be spinning. And as for the excuse that there's no alternative, I would ask, "Can you say, 'Sue me?'"

I have a lot of clients who have very good claims of employment discrimination. Companies have no trouble in forcing us to sue to enforce those claims. Let the AIG employees sue. They won't collect more than they will be paid as the company and the government turn tail. Many of them will settle for less. Given that the reasoning behind paying these bonuses is that AIG is "contractually obligated," many of those who sue will lose: surely they cannot maintain with a straigh face that they fulfilled their contracts by being so negligent, incompetent or worse that they put the company it the state it was in last last October.

AIG's excuse is that they need to retain talent. Huh? Retain them? Why weren't they fired months ago?

(The one bright spot is that Edward Liddy, AIG's CEO, was a Bush Administration appointee. A good time to fire him.)

Thursday, March 12, 2009


"Some will rob you with a six-gun and some with a fountain pen"
Pretty Boy Floyd, Woody Guthrie

Bernie Madoff is to plead guilty this morning. A few of his victims will be in the courtroom to face him. The New York Times reported suggestions that the proceeding be held at the new Citi Field (successor to Shea Stadium), to give a reasonable fraction of those duped a chance to attend. (The Times also reported suggestions that the new stadium should be re-named Debits Field.)

I don't know if Madoff will be sentenced today; there's no plea deal, and normally the court orders a pre-sentence evaluation and report. So it could be months before we know what is going to happen.

But look at it this way: If Madoff gets just one year for every billion that he claims to have stolen, he'll be sentenced to fifty years in prison. What would you or I get if we stole a hundred dollars from a guy on the street?

Tuesday, March 10, 2009

Very good news

The BBC reports that researchers have discovered an enzyme that they say is crucial in allowing cancer to metastasize. Metastasization is responsible for 90 percent of cancer deaths, so stopping the spread of the disease would be by far the largest step to improving treatment. (The story does not state what the prognosis is for a drug that would block the enzyme in humans, although it references studies in mice, without saying whether the enzyme was effectively blocked.)

One downside: the enzyme in question is LOX. Does that mean no more bagels....?

Monday, March 09, 2009


Most of the guns used by the Mexican drug cartels are sold to traffickers by American gun dealers. A man walks into a church, goes to the pulpit and guns down the pastor, in front of his horrified congregation. It actually made the news when a committee of the Arkansas state senate killed (no pun intended) a bill that would have allowed concealed weapons in churches. (I can hear it now: if some people in that Illinois church had had guns, the pastor might be alive today. Sure. Or maybe half a dozen more would be dead.)

And how do we respond? The United States Senate attaches a rider to a bill to give the District of Columbia a voting representative in Congress that would repeal the District's requirement for trigger locks and repeal a ban on assault weapons.

Think of it: you could legally carry a .50 cal. sniper rifle in Washington, D.C. That's right, a weapon that can deliver aimed, rapid fire against targets a mile away, within easy range of the nation's leaders. (Remember the D.C. sniper of a few years ago? He and his sidekick terrorized the whole D.C. metropolitan area with an ordinary rifle.)

Oh, and there's a later development: Yesterday, the Supreme Court refused to hear a case in which New York was trying to continue its campaign against gun manufacturers who flood the state with illegal weapons.

Will we ever wake up? Will we continue to let a minority of crazies hold the nation hostage? Will someone have the courage--or clarity--to stand up and say that the leadership of the NRA and its allied organizations are the witting or unwitting allies of drug dealers, mobsters and terrorists?

Friday, March 06, 2009

The more things change...

A couple of years ago, I noted that the Republicans, like the Bourbons of France, had learned nothing and forgotten nothing. (The phrase is from Talleyrand.)

That's even more true today, when the the once Grand Old Party has nothing to offer but the hope that Democrats will fail. They have not only ceded the initiative to President Obama (I like writing those words together!) and his allies on Capitol Hill, they have no ideas worth the name to offer as an alternative. That is sad, because for all of his energy, initiative and ability, Obama has not been perfect so far, and intellectual competition could improve the way we are governed. But the Republicans offer no creative ideas about the direction in which the nation should move, or even on the issues of the day.

Almost certainly, there will come a time when this will change, when Republicans will offer some real, if misguided, theories on what the United States should be like and how we should govern ourselves. And when that happens, we Democrats will deride the Republicans and wail if the voters seem to accept what they have to say. But in the long run, the nation will be better for it. Well, maybe. Are we really better off for having had Reagan?

Thursday, March 05, 2009

John Stewart gets the meltdown

I'm not a fan of The Daily Show, because there are more hits and misses. But here is a real hit, via TPM.