Bang for the buck

The chief economist for Moody's Economy.com site has done an overview of the fiscal stimulus plan that came through the House.

I just thought I'd mention where he indicates that demand-side money does much more than tax cuts for boosting the GDP.

The ratio of dollars of GDP generated in a year to dollars spent:

Spending increases
Extending unemployment benefits--1.63
Temporary increase in food stamps--1.73
General aid to state governments--1.38
Increased infrastructure spending--1.59

Tax cuts

Non-refundable lump-sum tax rebate--1.01
Refundable lump-sum tax rebate--1.22

Temporary tax cuts
Payroll tax holiday--1.28
Across the board tax cut--1.03
Accelerated depreciation--0.25

Permanent tax cuts
Extend Alternative Minimum Tax patch--0.49
Make Bush tax cuts permanent--0.31
Make dividend and capital gains tax cuts permanent--0.38
Cut in corporate tax rate--0.30

The aid to states is particularly interesting because most states are barred from deficit spending.

Speaks volumes about the House Republicans tax-cut based stimulus plan

Book review--Revolutionary Road

I think the writing is first-rate. The plot avoids making melodramatic martyrs out of the characters. There is no portrayal of Frank and April has being these intrinsically Byronic repressed-artist types. The closest the book comes to that are April's vague thespian ambitions. What we have is more of a sense of unsettledness in the milieu of Eisenhower-era suburbia.

The interesting part of their characterization is the depiction of the events of their youths, April's loveless childhood and Frank's wanderlust and his vague sense that he was meant for something big. Thus, it isn't just the intrinsic qualities of suburbia but the Wheeler's ill-adaptedness to it.

At the risk of giving too much away, the shifting in the perspective of the story to the Campbells from the Wheelers was a deft choice. I have to think that having a mentally unbalanced character making the trenchant observations he makes in the book has a cliched feel to it (sort of like having a blind character be the most insightful).

I think that back in 1961, the idea of a dry rot lying inside 1950s suburbia was probably had more of an impact then it would now. This is largely because the Wheeler's of the 1960s and 1970s were, in fact, more daring in living out of the box then their 1950s predecessors. Likewise, the use of the consideration of abortion as a plot device would've carried more weight pre-Roe v. Wade.

Notes re the Federal Reserve

There are certainly problems with the approach the Fed has taken during the Greenspan era. It's allergy to full employment is one. It's excessive trust in the free market is another, for example it's failure to raise stock margins during the bursting of the tech bubble. However, it is also the subject of the rabid imaginings of a whole cabal of conspiracy mongers. I found a couple of links courtesy of Crooks and Liars that I thought I'd post here for future reference.

The first is a series of points made by a professor of economics at Charleston College.

The second is a quick look at some of the more rabid right-wing populism involved.

Finally, here's the link to the overall article on Crooks and Liars.

Two quick snippets

On the expiration of an administration that virtually screams "epic fail", I offer two snippets.

The first is from Cromwell's statement to Parliament
""You have sat too long for any good you have been doing lately ... Depart, I say; and let us have done with you. In the name of God, go!"

The other is an old song lyric
""Na na na na / na na na na / hey hey hey / goodbye."

A long overdue step

Just noting an item from the McClatchy site on an agreement between Congressional Democrats and Citigroup regarding accepting the idea of mortgage "cram-downs". This is where a bankruptcy judge can adjust the size of the debt owed on a home to reflect the current market value of the home. It only applies to existing mortgages and the borrower has to give ten-days notice to the lender. Given that the bailout money that has been given out has largely gone into allowing big banks to gobble up smaller ones and that lack of a provision in the original plan assisting people at the bottom of the food chain, this is a welcome provision.

No more Good Time Chavez?

I have long been skeptical of Hugo Chavez's "21st Century Socialism" as being nothing more than the catch-phrase of an egocentric demagogue who happened to be in a position to have access to tons of cash from the rise in oil prices. This sentiment applied just as much to his attempt to buy a geopolitical blog in Latin America as to his domestic policies.

The key test of any such program is how well it does when oil prices drop. According to McClatchy, not so much (see also here and here.)

Executive transitions

There's a piece on The Nation's blog boards by John Nichols which starts:

In most democratic republics, elections are followed by the rapid transfer of power.

In Great Britain, for instance, the new prime minister takes over the day after the election.

Not so the United States.

Here, the better part of three months pass between election day and inauguration day.

The thrust of his piece is that he is passing out jobs to administration loyalists between Election Day and Inauguration Day. Given the relatively honorific (i.e., no actual power) nature of the appointments (President's Council on Physical Fitness and Sports, United States Holocaust Memorial Council, etc.), I would think he'd want to focus more on the "burrowing" of political appointees into executive agencies by redesignating them as career civil service staff.

In any event, both issues are part of the so-called "lame duck" period between the election of a new president and his inauguration. Certainly, the outgoing president can do considerable mischief, in fact, Rachel Maddow has created a segment entitled "Lame Duck Watch" to monitor precisely that. There is also historical precedent. The famous case of Marbury v. Madison, 5 U.S. 137 (1803) stemmed from several appointments made literally in the last hours of the John Adams administration

The problem is that any attempt to compare our transition to the one in the UK overlooks the differences between parliamentary and presidential types of government. In a UK-style parliamentary system, the opposition usually has a government-in-waiting called a shadow cabinet. They serve as the opposition's point persons in responding to the policies of the government. A corollary of that function is that they will generally hold similar posts when the opposition has its turn in government. In a sense, the incoming leader's cabinet has already been selected.

They also invariably sit in the parliament. Since the continuation of a government in a parliamentary system depends on maintaining a majority in parliament, such close bonds are unavoidable. In a strong presidential system, cabinet members don't necessarily have to be members of Congress. In fact, our Constitution explicitly forbids that. Article I, Section 6 states that

"No Senator or Representative shall, during the Time for which he was elected, be appointed to any civil Office under the Authority of the United States, which shall have been created, or the Emoluments whereof shall have been increased during such time; and no Person holding any Office under the United States, shall be a Member of either House during his Continuance in Office."

The purpose of that clause was to avoid the type of royal co-opting of MPs that took place at the time in the form of bestowing various sinecures on them. The US system is based on independent, coordinate branches of government and thus has such a provision in order to keep any branch from subordinating the other.

As I've said, a prime minister in a parliamentary system is just a first-among-equals. His continued presence in office depends on constantly keeping a majority of his own party behind him. The President has an independent electoral mandate and, although he certainly needs to keep his party lined up behind him, he has greater leeway in his choices since he can't just be removed with a no-confidence vote. With a greater leeway in choices there must also be more time in which to make them.

Although it does make for a longer transition, a wider array of choices also means access to a greater talent pool. A president isn't limited to members of Congress for his choices. Often governors (a position which has no equivalent in a unitary state such as the UK) get chosen. Likewise, one could give a cabinet position to someone with professional experience who isn't in the legislature. Obama's Secretary of Education-designate currently runs the public schools in Chicago.

Roland Burris, continued

An incident in Burris' career has come to light in the "internets" (think the O.E.D. will adopt that as a word?). The links are too numerous to provide here but any Google search using "Roland Burris" and "Rolando Cruz" will bring them up. The basics are that, in 1985, Rolando Cruz had been convicted of a capital offense and was on death row. In 1992, Roland Burris was the Illinois Attorney General and had received notification from the Assistant Attorney General who was fighting Cruz's appeal that there had been prosecutorial irregularities in the investigation of sufficient scope that she couldn't put her name on the appellate brief. Burris's response was to take her off the case and continue to fight the appeal, without reexamining the case himself. Justice proceeded notwithstanding and Cruz is now a free man, helped in part by DNA evidence exonerating him.

Burris at the time had ambitions for higher office. He ran in, and lost, primaries in 1994 and 1995 and the conclusion that his decision not to reexamine the Cruz case was because of his political ambitions is inescapable. Although such pusillanimous conduct would've been a very good reason for Blagojevich not to have selected him (assuming, with more hope than substance, that the Governor would've been motivated by an ethical consideration), it probably isn't sufficient reason for the US Senate to deny him his seat. First, it doesn't tie in to his selection sixteen years later and so doesn't come into the ambit of Article I, Sec. 5. Second, it's hard to see that kind of low political pandering as a disqualification for elective office, rather the opposite. I am reminded of Bill Clinton's actions regarding Ricky Ray Rector when the former was running for President in 1992. Rector was on death row. The issue wasn't if he had committed the crime but that, shortly before he was arrested, he shot himself in the head in an apparent suicide attempt that had effectively left him lobotomized. Clinton flew back to Arkansas in the middle of the campaign to sign off on the execution, in an action that was partially meant for public consumption. However, Rector was so mentally disabled that when the guards took him away for execution, he left his dessert on the grounds that he was saving it for later. Burris's action is hardly worse than executing a mentally incompetent inmate as a campaign ploy.

The other interesting comment I saw was a piece by Matthew Rothschild of The Progressive calling on Harry Reid to let Burris have the Senate seat. My first comment is that simply citing Powell v. McCormack isn't sufficient. This is more of an elections and returns issue than a qualifications issue. The other issue is that Blagojevich hasn't been convicted yet--

And there’s a larger point here, too: A prosecutor, by accusation alone, should not be allowed to throw someone out of elective office.

Remember, Blagojevich hasn’t even been indicted yet, much less convicted.

To deny him his authority on the basis of a criminal complaint is to hand a prosecutor enormous power.

The problem with that argument is that the presumption of innocence is part of due process, without which no one should be deprived of life or liberty. The Senate's action would only amount to not letting Burris into the Senate. The fact that Art. I, Sec. 5 makes each house of Congress the "final judge" in such matters means that the Senate doesn't have to wait for the judiciary to make it's determination of Blagojevich, it can decide independently if the Burris selection is tainted. In doing so, it isn't handing power to a prosecutor but exercising its own. Rothschild's comparison to Ken Starr is considerably off point.

I reiterate my point that there doesn't seem to be any taint on the Burris selection, and thus the Senate will have to seat him--but the Senate does get to make an independent determination of that.