Tuesday
On fitness
I've written once before about the idea that New York City Mayor Michael Bloomberg run for a third term despite the fact that New York City's term limit law prohibits the mayor, comptroller, public advocate, city council members, and borough presidents from serving more than two consecutive terms. I want to highlight the fact that the prohibition is on more than two consecutive terms, because this is a better way of balancing the costs and benefits of term limits than a hard and fast two term rule. It alleviates incumbent entrenchment and at the same time allows the voters to bring back the previous office-holder if they still prefer him or her. See §§1137-38 of the New York City Charter (.pdf link, page 242) for the exact wording of term limit law, if you're interested.
I was originally going to write about the idea again today because I read that cosmetics fortune heir Ronald Lauder, who had bankrolled the campaigns for the two referendums in favor of term limits, had come out in favor of changing the law to allow Bloomberg to serve a third term due to the ongoing financial crisis. But in the time between when I thought about writing this post and actually did it, Bloomberg himself announced that he plans to ask the City Council to change the law and then run again, and the N.Y. Times wrote another awful op-ed on this topic (my previous post on term limits discusses the ways in which the Times editorial board's thinking about term-limits is generally moronic).
So the facts have changed, but the points I wanted to make still stand: The only way for a legislative body to remove a term limit without engaging in massive self-dealing at the voters' expense is for it do so but have that change take effect after the next election, having a legislative body do so after voters have twice voted in referenda to have such a law is even worse, and asking the City Council to do so after you, Michael Bloomberg, have “repeatedly said [you] support[] such constraints on elected leaders, dismissed the idea that anyone is indispensable, and once called an effort to revise the limits 'disgusting'” pretty much disqualifies you from being fit to hold office all by itself and makes a mockery of your entire public career.
I had meant to talk in this post about two other procedural issues with elections and passing laws, namely the National Popular Vote bill and Nancy Pelosi's mistaken decision to hold the vote open on the bailout yesterday to see if she could twist some arms, but this post is too long as it is. I may take those topics up later.
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I was originally going to write about the idea again today because I read that cosmetics fortune heir Ronald Lauder, who had bankrolled the campaigns for the two referendums in favor of term limits, had come out in favor of changing the law to allow Bloomberg to serve a third term due to the ongoing financial crisis. But in the time between when I thought about writing this post and actually did it, Bloomberg himself announced that he plans to ask the City Council to change the law and then run again, and the N.Y. Times wrote another awful op-ed on this topic (my previous post on term limits discusses the ways in which the Times editorial board's thinking about term-limits is generally moronic).
So the facts have changed, but the points I wanted to make still stand: The only way for a legislative body to remove a term limit without engaging in massive self-dealing at the voters' expense is for it do so but have that change take effect after the next election, having a legislative body do so after voters have twice voted in referenda to have such a law is even worse, and asking the City Council to do so after you, Michael Bloomberg, have “repeatedly said [you] support[] such constraints on elected leaders, dismissed the idea that anyone is indispensable, and once called an effort to revise the limits 'disgusting'” pretty much disqualifies you from being fit to hold office all by itself and makes a mockery of your entire public career.
I had meant to talk in this post about two other procedural issues with elections and passing laws, namely the National Popular Vote bill and Nancy Pelosi's mistaken decision to hold the vote open on the bailout yesterday to see if she could twist some arms, but this post is too long as it is. I may take those topics up later.
Monday
Obama campaign, take note
Thing I thought was funny this weekend but everyone I said it to just stared at me like I was a weirdo and which I will nevertheless repeat on my blog: my suggestion, following McCain making a self-deprecating comment about his own age and people I was watching the debate with appreciating the comment, that Joe Biden should at some point criticize a proposal of McCain's, probably his health care or tax plans, as “faker than my hair.” Such a sound bite would be endlessly covered by cable news.
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Friday
It takes a train to cry
I sometimes think that law professor Noah Feldman who writes for the Times Magazine is not the same person as law professor Noah Feldman who taught me in my Church & State class.
I have a number of issues with the linked article, but only raise one here. Noah writes, “The debate between inward-looking conservatives and outward-looking liberals has recently taken a turn toward the shrill. Liberal lawyers do not simply accuse their conservative counterparts of denigrating the rule of law; they accuse them of violating it themselves.” In support, he quotes someone accusing John Yoo of being a war criminal. This is fucking absurd and Feldman should be ashamed, I liked him as a professor and literally find this enraging. John Yoo, and maybe one or two other lawyers with the Office of Legal Counsel (William Haynes, Jay Bybee) have been accused of being war criminals because of their roles in crafting extraordinarily shoddy legal opinions which authorized the war crime of torture, not because they have an “inward-looking” view of the Constitution. Maybe the accusation that they are war criminals is wrong, and it's an accusation not be thrown around lightly, but it's simply a joke and an insult to his readers and any conservative legal thinkers who don't think their views entail the legality of torture, to suggest that they've been accused of war crimes merely because of conservative views on international law.
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I have a number of issues with the linked article, but only raise one here. Noah writes, “The debate between inward-looking conservatives and outward-looking liberals has recently taken a turn toward the shrill. Liberal lawyers do not simply accuse their conservative counterparts of denigrating the rule of law; they accuse them of violating it themselves.” In support, he quotes someone accusing John Yoo of being a war criminal. This is fucking absurd and Feldman should be ashamed, I liked him as a professor and literally find this enraging. John Yoo, and maybe one or two other lawyers with the Office of Legal Counsel (William Haynes, Jay Bybee) have been accused of being war criminals because of their roles in crafting extraordinarily shoddy legal opinions which authorized the war crime of torture, not because they have an “inward-looking” view of the Constitution. Maybe the accusation that they are war criminals is wrong, and it's an accusation not be thrown around lightly, but it's simply a joke and an insult to his readers and any conservative legal thinkers who don't think their views entail the legality of torture, to suggest that they've been accused of war crimes merely because of conservative views on international law.
Yonder lies a steel drivin' man
Kleiman's Plan C bailout proposal. I haven't yet spotted a flaw in it, it seems to serve both liquidity providing and capital injecting goals of the current plans with more costs and fewer benefits.
Ta-Nehisi Coates on his similarities to Sarah Palin, and how McCain has wronged her. I don't think I disagree with his claim that, “There can be no doubt that they picked Palin strictly as a stick to drum up the victimhood narrative--small town, hunters, big families and most importantly, women,” but really making that case requires considering the cases some conservatives had made for Palin months in advance of her disastrous pick, and whether McCain may have had any of the reasons they had for wanting to select her.
Ben Smith on Obama's legal team asking stations to take down ads in ways which have worrisome first amendment chilling effects.
Prof. Rauchway puts WaMu's failure in the context of percentage of U.S. GDP held in the failed bank. His numbers show that at least one bank failure in the Great Depression was an order of magnitude greater, and that understates how much worse it was. This is useful for assessing the claim that WaMu's failure is the worst bank failure in American history, except I think one could argue that the fact that most depression safeguards against bank failure didn't exist then but do now makes the cases slightly harder to compare.
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Ta-Nehisi Coates on his similarities to Sarah Palin, and how McCain has wronged her. I don't think I disagree with his claim that, “There can be no doubt that they picked Palin strictly as a stick to drum up the victimhood narrative--small town, hunters, big families and most importantly, women,” but really making that case requires considering the cases some conservatives had made for Palin months in advance of her disastrous pick, and whether McCain may have had any of the reasons they had for wanting to select her.
Ben Smith on Obama's legal team asking stations to take down ads in ways which have worrisome first amendment chilling effects.
Prof. Rauchway puts WaMu's failure in the context of percentage of U.S. GDP held in the failed bank. His numbers show that at least one bank failure in the Great Depression was an order of magnitude greater, and that understates how much worse it was. This is useful for assessing the claim that WaMu's failure is the worst bank failure in American history, except I think one could argue that the fact that most depression safeguards against bank failure didn't exist then but do now makes the cases slightly harder to compare.
Thursday
The Deerslayer tale accomplishes nothing and arrives in the air
Yglesias explains why even though it's normally a bad idea to modify the terms of mortgages retroactively, circumstances we're presently faced with make it a really good idea.
Bruce Schneier makes a great point about the lack of utility, and likely harm (because it mis-uses limited resources) of airport screeners not letting liquids greater than 3 fl. oz. and other obviously harmless things on board airplanes but not giving increased scrutiny to people trying to bring them on planes.
Yglesias on how bailouts beget bailouts.
David Levinson Wilk on crossword puzzles, “Obama,” and “McCain.”
Yglesias links to Farley on the history of the Posse Comitatus Act. I drafted a post on that exact topic a couple months ago when I first realized it was passed to protect white supremacists, but took it down because all it said was, “Guess what I learned today? The Posse Comitatus Act, which I mainly know about from West Wing, was passed to protect white supremacists.”
Eric Martin edifies me with a historical tidbit about one of the reasons the Great Britain didn't intervene to help the Confederacy in the U.S. Civil War.
Kevin Drum writes a post I told him to. That's the only reason I'm linking to it.
Image of index card which tops this post courtesy of Yglesias (his posts today were unusually good, so he shows up a lot in this link-dump) who stole it from indexed.
Hinting
Commenting communities make blogs better. If you want this blog to be better, be the change you wish to see in the world.
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The word of the day is timeous
It means timely, and thus should not be confused with timorous.
The original plan for this post was to note that the Yankees, with their current 87-71 record, have a record as good as or better than the playoff bound or contending White Sox, Twins, Mets, Brewers, and Dodgers. Since they are in the hardest division in baseball they have no chance at making the playoffs, but this shouldn't be used to suggest that they're a bad team. Like I said, that was the plan, but two considerations suggest that it's a bad one.
First, it's absurd for a Yankees fan to make that argument, since for a long time they were, and still indirectly are, the reason it's the hardest division in baseball
But that reason alone wouldn't have stopped me from making the argument. The second reason does: the Yankees are very lucky to have such a good record. I mean lucky in the particular sense that a team which scored the number of runs the Yankees actually scored and allowed the number of runs they actually allowed would be expected to win fewer games than any of the teams mentioned above, any of the teams which have already clinched, and the Blue Jays who the Yankees are ahead of. By run-differential they're the twelfth best team in baseball. So never mind, the Yankees are kind of bad, and not just unlucky to be in a hard division.
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The original plan for this post was to note that the Yankees, with their current 87-71 record, have a record as good as or better than the playoff bound or contending White Sox, Twins, Mets, Brewers, and Dodgers. Since they are in the hardest division in baseball they have no chance at making the playoffs, but this shouldn't be used to suggest that they're a bad team. Like I said, that was the plan, but two considerations suggest that it's a bad one.
First, it's absurd for a Yankees fan to make that argument, since for a long time they were, and still indirectly are, the reason it's the hardest division in baseball
But that reason alone wouldn't have stopped me from making the argument. The second reason does: the Yankees are very lucky to have such a good record. I mean lucky in the particular sense that a team which scored the number of runs the Yankees actually scored and allowed the number of runs they actually allowed would be expected to win fewer games than any of the teams mentioned above, any of the teams which have already clinched, and the Blue Jays who the Yankees are ahead of. By run-differential they're the twelfth best team in baseball. So never mind, the Yankees are kind of bad, and not just unlucky to be in a hard division.
Wednesday
All my troubles seemed so far away
Same deal with ordering as the previous link dump.
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- Marc Lynch on parliamentary passage of the Iraqi provincial election law. I didn't see this covered on any of the blogs I normally read today, probably because they've been burned before by phony progress on this front and had economic news and Presidential campaigning to talk about, but it's an important development towards potential stability in Iraq. It's not, of course, a reason to leave U.S. soldiers there.
- Eric Rauchway on what was happening on other September 24th's which didn't require one Presidential candidate to call for a halt to the campaign. The U.S. Civil War, for one.
- Jim Dwyer discusses the costs of building subway tunnels in New York and alternatives proposals.
- Bob Somerby criticizes Obama for overstating the benefit cut in McCain's social security plan and Josh Marshall for defending Obama against other criticism on this point.
- Jake Tapper illustrates how easy to it is get to eighteen Biden gaffes when you count totally non-problematic non-gaffes.
- Someone at Deadspin correctly suggests that Victor Zambrano should throw out the first pitch for the
DevilRays' first playoff series. - Matt Yglesias cites precedent for McCain's attempt to call a time out.
The Guarantee
Yesterday, Megan McCardle asked, with regards to the bailout plan, “[A] lot of Democrats seem to want the Wall Street executives to disgorge things like their retirement packages and bonuses before cutting any deal. Can Congress do this, legally? I mean, yes, they make the law. But my understanding is that while you can grandfather in benefits, you can't retroactively punish people for behavior that was legal when committed. Can Congress reach in and retroactively void a private contract?” and Kevin Drum replied, “Not a chance. The Fifth Amendment prohibits the direct impairment of contracts, and Article 1 prohibits both bills of attainder and ex post facto laws.” The answer to both of Megan's questions are yes, and Drum's answer goes badly wrong.
The Fifth Amendment doesn't mention impairment of contracts, but Article 1, Section 10 does. However, post-New Deal jurisprudence interprets the contracts clause to primarily attack the evil of states unilaterally changing the terms of contracts they enter into, not changing the terms of contracts between two other parties, like an employee and employer. Such changes, if challenged under the contracts clause, will be reviewed with a very lenient standard.
The ex post facto clause prohibits criminal punishment of conduct which wasn't criminal at the time the conduct took place and is obviously inapplicable here.
The bill of attainder clause prohibits the legislature from punishing, and not just criminally, specific individuals or easily ascertainable members of a group without a trial. I don't know of any precedent which addresses the issue of just how easily ascertainable the members have to be, but the cases I know of deal with groups both smaller and more particular than that composed of people above a certain level in the hierarchy of whichever companies choose to take advantage of the bailout fund is not sufficiently easily ascertainable, and I think that's the relevant group. Even if the members were too ascertainable, as long as any bill conditions disgorgement of benefits upon choosing to make use of the fund it wouldn't be a punishment for the purposes of the bill of attainder clause.
In unrelated legal pedantry, it's not the case that, as Michael Lewis wrote in a somewhat funny satirical1 article today, “Not only was [Paulson] required to sell his half-billion dollars in Goldman stock near the high, but also, as Treasury Secretary, he was exempt from capital-gains taxes.” He was required to sell by conflict of interest laws, but his gains are not tax-exempt. Rather, assuming he got a certificate of divestiture which states that he was required to sell those shares because of conflicts of interest laws, he could, according to Internal Revenue Code §1043 reinvest the funds in either treasuries or certain “diversified investment funds,” which are mostly blind trusts and not recognize the gain on the original sale until he realized a gain or loss on the sale of the property purchased with the proceeds from it. And I read elsewhere that Paulson, unlike other Federal appointees covered under 1043 couldn't buy treasuries, which makes sense, since he's the Secretary of the Treasury. While there's obviously value in deferring taxation, it's not the same the thing as being exempt from capital gains, and the difference shouldn't be elided.
1. The claim I'm refuting doesn't just appear in satire, there's a good deal of confusion about the matter. For instance, “One fringe benefit was the capital gains tax exemption given to federal appointees who have to sell holdings before they take office.”
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The Fifth Amendment doesn't mention impairment of contracts, but Article 1, Section 10 does. However, post-New Deal jurisprudence interprets the contracts clause to primarily attack the evil of states unilaterally changing the terms of contracts they enter into, not changing the terms of contracts between two other parties, like an employee and employer. Such changes, if challenged under the contracts clause, will be reviewed with a very lenient standard.
The ex post facto clause prohibits criminal punishment of conduct which wasn't criminal at the time the conduct took place and is obviously inapplicable here.
The bill of attainder clause prohibits the legislature from punishing, and not just criminally, specific individuals or easily ascertainable members of a group without a trial. I don't know of any precedent which addresses the issue of just how easily ascertainable the members have to be, but the cases I know of deal with groups both smaller and more particular than that composed of people above a certain level in the hierarchy of whichever companies choose to take advantage of the bailout fund is not sufficiently easily ascertainable, and I think that's the relevant group. Even if the members were too ascertainable, as long as any bill conditions disgorgement of benefits upon choosing to make use of the fund it wouldn't be a punishment for the purposes of the bill of attainder clause.
In unrelated legal pedantry, it's not the case that, as Michael Lewis wrote in a somewhat funny satirical1 article today, “Not only was [Paulson] required to sell his half-billion dollars in Goldman stock near the high, but also, as Treasury Secretary, he was exempt from capital-gains taxes.” He was required to sell by conflict of interest laws, but his gains are not tax-exempt. Rather, assuming he got a certificate of divestiture which states that he was required to sell those shares because of conflicts of interest laws, he could, according to Internal Revenue Code §1043 reinvest the funds in either treasuries or certain “diversified investment funds,” which are mostly blind trusts and not recognize the gain on the original sale until he realized a gain or loss on the sale of the property purchased with the proceeds from it. And I read elsewhere that Paulson, unlike other Federal appointees covered under 1043 couldn't buy treasuries, which makes sense, since he's the Secretary of the Treasury. While there's obviously value in deferring taxation, it's not the same the thing as being exempt from capital gains, and the difference shouldn't be elided.
1. The claim I'm refuting doesn't just appear in satire, there's a good deal of confusion about the matter. For instance, “One fringe benefit was the capital gains tax exemption given to federal appointees who have to sell holdings before they take office.”
Tuesday
Mostly baliout-related links
All of these posts are good and worth reading, they're posted in the order that I'd read them if I was only going to read that number of them:
Update:
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- David Cay Johnston on whether there is a financial crisis which merits a bailout package of anything like this magnitude, and why that claim isn't being more strongly questioned.
- Mark Kleiman's public choice theory based take on problems with getting the bailout bill through Congress (it's not clearly in the interests of the Democrats or Republicans to do it).
- Ed Paisley's “Fair and Effective” bailout plan. It's not particularly similar to any plan under discussion.
- Kleiman again on why it might economic sense, from the government's perspective to pay over the current market price for mortgage backed securities. I know why Kleiman and others have been focusing almost all of their posts lately on the deficiencies of John McCain, and most of the remainder on the virtues of Barack Obama, but speaking selfishly I miss posts like the two I just linked.
- Eric Martin notes that Prime Minister Maliki says that Bush asked him to make the withdrawal date for U.S. soldiers from Iraq later for reasons of U.S. domestic politics, namely to help John McCain win.
- Jesse Walker gets a zinger in at Joe Biden's expense. Biden gaffes have been, both justly and unjustly, a major media narrative today.
- The odds of the Yankees game at Fenway this Friday being possibly meaningful for the playoffs are 1 in 200.
Update:
- The odds of the Yankees game this Friday being meaningful for the playoffs are zero in (whatever denominator you please). They are infinitely against.
- Since my top recommendation was David Cay Johnston's questions about the bailout, I also want to link to Ryan Avent answering some of the important ones in ways which suggest a bailout, and a bailout with a magnitude like this one, is needed.
Monday
Crime, boy, I don't know
In an ancient tradition of this blog, I lied about what the next post would be about, and when it'd be written, but I can't let Aaron Sorkin guest-writing Maureen Dowd's column pass without comment.
As a West Wing fan, I liked it, especially the last line, because it conjures pleasant memories. Though it doesn't say anything other people haven't said elsewhere, it's nice sometimes to see things you believe and others dispute forcefully stated, which the “Get Angrier” paragraph does pretty damn well, though it took too much initial throat-clearing to get there. While I think pretty much everything in that paragraph is correct, I'm not sure about the source of/truth of the “It's not bad enough she thinks the planet Earth was created in six days 6,000 years ago complete with a man, a woman and a talking snake, she wants schools to teach the rest of our kids to deny geology, anthropology, archaeology and common sense too?” claim. I've heard it floating around, but never seen what statement or action of Palin's people are tying it too, other than which church she was a member of and her enthusiasm for that church.
The only other thing I noticed that the column gets wrong is that Obama and McCain aren't in a “statistical tie.” It's unhelpful to use this term to describe the race as a whole, as opposed to the results of an individual poll or the aggregate of the polls, which might have enough precision to in fact be in a statistical tie. Not a big deal, since he couldn't have known exactly what the latest polling was saying as the column was coming to print and probably just wanted to point towards the general shape of the race, but does suggest that Sorkin is unfamiliar with the critiques directed at press reports describing polling results as statistical ties when they aren't.
The typical critique of Sorkin, which I buy in part, is that he's just sticking debater's points into his TV character's mouths, and that they're not even that great debater's points. That seems to be much less of a problem when he's writing in this venue.
Amazing that Dowd managed to get a dig against the Clinton's into the sixty-six words she wrote for this column, she's truly obsessed.
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As a West Wing fan, I liked it, especially the last line, because it conjures pleasant memories. Though it doesn't say anything other people haven't said elsewhere, it's nice sometimes to see things you believe and others dispute forcefully stated, which the “Get Angrier” paragraph does pretty damn well, though it took too much initial throat-clearing to get there. While I think pretty much everything in that paragraph is correct, I'm not sure about the source of/truth of the “It's not bad enough she thinks the planet Earth was created in six days 6,000 years ago complete with a man, a woman and a talking snake, she wants schools to teach the rest of our kids to deny geology, anthropology, archaeology and common sense too?” claim. I've heard it floating around, but never seen what statement or action of Palin's people are tying it too, other than which church she was a member of and her enthusiasm for that church.
The only other thing I noticed that the column gets wrong is that Obama and McCain aren't in a “statistical tie.” It's unhelpful to use this term to describe the race as a whole, as opposed to the results of an individual poll or the aggregate of the polls, which might have enough precision to in fact be in a statistical tie. Not a big deal, since he couldn't have known exactly what the latest polling was saying as the column was coming to print and probably just wanted to point towards the general shape of the race, but does suggest that Sorkin is unfamiliar with the critiques directed at press reports describing polling results as statistical ties when they aren't.
The typical critique of Sorkin, which I buy in part, is that he's just sticking debater's points into his TV character's mouths, and that they're not even that great debater's points. That seems to be much less of a problem when he's writing in this venue.
Amazing that Dowd managed to get a dig against the Clinton's into the sixty-six words she wrote for this column, she's truly obsessed.
Friday
End of the Engagement
Updating on the accuracy of my own prediction, a topic I have trouble imagining anyone but me being interested in, the two most recent Obama electoral vote estimations on fivethirtyeight have been 258 and then 284.8. These numbers indicate that I was correct in calling the bottom of his collapse on Tuesday of this week, but that my feel for the pulse of the election was somewhat off, I really thought we'd see a longer steadier climb instead of a huge leap like this one anyone. Also, if the number starts showing a large degree of volatility or another collapse anytime soon, I'd still be wrong. I'm mentioning this because for the prediction to be at all impressive, it really has to be more specific than calling that the number will go up somewhat for a couple of days. I would expect Obama's number to fluctuate between 275 and 300 for the next week, though obviously events in the news might change this. I guess I'm also predicting there won't be any events in the news for the next week which change the way people feel about the presidential election.
Tomorrow's post will be about at least one of the Yankees, Howard Hawks, and John Irving.
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Tomorrow's post will be about at least one of the Yankees, Howard Hawks, and John Irving.
Wednesday
Feet meet fire
Since yesterday's prediction that either the 250.3 electoral votes then posted or whatever was posted today would be the bottom for Obama's polling collapse, with the former scenario slightly more likely, the number has dropped to 249.7. This drop came in the wake of a day of good polling for McCain in Ohio, Colorado, Pennsylvania, and Florida. This makes me already wrong in part, since I gave a 60% chance of yesterday being the bottom. But that tiny drop after days of much larger ones makes me even more confident that the trajectory is changing and tomorrow will show a rise and vindicate me. Keep your eyes on this page for either gloating or hiding in shame in the near future.
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Tuesday
Known Unknowns
In an extraordinary turn, the Federal Reserve was close to a deal Tuesday night to take a nearly 80 percent stake in the troubled giant insurance company, the American International Group, in exchange for an $85 billion loan, according to people briefed on the negotiations.So we're nationalizing AIG. Let's ignore for a moment the difference between the Federal Reserve owning it and the federal government owning it, though it's a real and interesting difference. I don't have the expertise to know whether or not that's a good idea. What gives me pause is that when the Federal Reserve offered a $30 billion credit line to JPMorgan Chase so that it would purchase Bear Stearns, the argument made was that this extraordinary step was needed to avert a chain of events which would cause numerous other companies, first in the financial industry and then in other industries, to collapse. Seems to be a good argument, if it were true that the credit line would have that effect. But I take it that the last couple of weeks, between FHLMC, FNMA, Lehman, Merrill, and now A.I.G. have demonstrated that no such crisis was averted, it was at best delayed (which may have been important, I say non-expertly). But now the same argument is being made with regard to the steps to remedy this crisis, and again it sounds like a good argument if the crisis is actually remedied. But if the crisis isn't remedied, it's not something that we can keep doing. The Federal Government's ability to intervene here by taking responsibility for debts which the market otherwise considers bad risks is not unlimited and if continued would fairly quickly (meaning in at most a few years) have severe effects on future U.S. standards of living. Further, my vague understanding (meaning I can't even cite specific examples) of foreign governments trying to avoid economic problems using similar means is that they have not in general worked well.
All of A.I.G.’s assets would be pledged to secure the loan, these people said, and in return, the Fed would receive warrants that could be exchanged for an ownership stake. Stock of existing shareholders would be diluted, but not wiped out.
I'm not saying this will happen, just expressing my anxiety and ignorance. Maybe, on the other hand, A.I.G. will turn around and the government's 80% stake will make it easier to fund a new, better, government health insurance system. After all, “Most of A.I.G.’s businesses, including a dizzying array of insurance companies, an aircraft leasing business and an automotive unit, are healthy” and “A.I.G. has also considered sales of virtually all of its business assets, but conducting such sales quickly would be hard.” Perhaps the Fed's bridge loan will just allow this to take place in a non-panic sale setting where A.I.G. isn't forced to accept whatever is offered them.
I'll post more about this when I read someone else saying smart things which I understand. Krugman, probably.
Update (11:00 PM): Felix Salmon's most recent A.I.G. post is good, both for asking provocative questions and for having data on the amounts involved here.
Closing the Iron Door
And also, if you put lipstick on my pig, do you know what the difference will be between that pig and a pit bull? I’ll tell you: a pit bull can easily kill a pig. And, as the pig dies, guess what the Hockey Mom is doing?By absolutely all means, read the whole thing. Could benefit from brevity, but given how much of it is excellent I don't hold the low points against it. It also might count as evidence (not saying for which side) in a debate over the phenomenon of urban, coastal, purportedly liberal, contempt for people who aren't in that group. Recent edition of that debate prompted by this post (which is fine, except that she moves from discussing a group based upon its geographical, economic, and educational markers to acting as if that group is equivalent to liberals), these responses, and currently being mooted here.
Otherwise, I'm feeling electorally optimistic today, and think either today's FiveThirtyEight electoral vote number of 250.3 or possibly (but only say a 40% chance) tomorrow's will be the basement of Obama's post-RNC polling collapse. I almost want to say it'll be the worst number he has from now until the election, but I don't have enough of a basis to rule out another drop later on. Just saying I expect to see no further drop anytime soon and an extended rise starting tomorrow or Thursday.
