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Mark Steyn on negotiating with Barack O’Bluffer.

… For the Most Gifted Orator in Human History, the president these days speaks largely in clichés, most of which he doesn’t seem to be quite on top of. “Eric, don’t call my bluff,” he sternly reprimanded the GOP’s Eric Cantor. Usually, if you’re bluffing, the trick is not to announce it upfront. But, in fact, in his threat to have Granny eating dog food by Labor Day, Obama was calling his own bluff. The giant bluff against the future that is government spending.

How many of “the wealthy” do you require to cover a one-and-a-half trillion-dollar shortfall every single year? When you need this big a fix, there aren’t enough people to stick it to. “We are not broke,” insists Van Jones, Obama’s former “green jobs” czar and bespoke communist. “We were robbed, we were robbed. And somebody has our money!”

The somebody who has our money is the government. They waste it on self-aggrandizing ideologue nitwits like Van Jones and his “green jobs” racket. How’s the “green jobs” scene in your town? Going gangbusters, is it? Every day these guys burn through so much that they can never bridge the gap. By that, I don’t mean that an American government that raises two trillion but spends four trillion has outspent America, but that it’s outspent the planet. …

UVA prof with nice things to say about the effects of the Tea Party.

With the breakdown of negotiations on a so-called grand bargain on the debt limit demanded by President Obama, liberal commentators have sought a convenient scapegoat to account for the impasse. Not surprisingly, they have begun by rounding up the usual suspect: the Tea Party. Its intransigence, so the line goes, has sunk this great deal.

For two years now, “Blame the Tea Party First” has been the Democrats’ favorite mantra. “Firsters” invoke the Tea Party to make sense–for themselves–of the otherwise inexplicable fact of large-scale public opposition to President Obama, and they hold the Tea Party responsible for many of the nation’s deeper problems, from incivility in our discourse to an inability to set aside intransigent partisanship.

Generosity in describing one’s foes is a rarity, especially among conspiracy theorists. But Firsters have carried their animus against the Tea Party to unprecedented heights by failing to credit it with what is today right before everyone’s eyes. Without the Tea Party, there would be no debt limit negotiations going on, just as there would have been no budget reduction deal last December. Without the Tea Party, President Obama would not be posing as the judicious statesman, but would be pushing –as in truth he still is–for more stimulus and further investments in high-speed rail. Whatever pressure now exists to treat the debt problem derives directly or indirectly from the explosion of energy that has been generated by the Tea Party.

In lambasting the Tea Party movement for its stubborness, Firsters have silently acknowledged what for two years they had all but denied. Instead of being in fact a front for racism or opposition to abortion, the “baggers,” as they have been derisively called, are genuinely insistent on cutting spending and containing the growth of government. Everything is less complicated than it seems. Supporters of the Tea Party are who they said they were. …

James Pethokoukis looks at Goldman’s new numbers and the effects on the administration.

Last night in a new report, Democrat-friendly Goldman Sachs dropped an economic bomb on President Obama’s chances for reelection (bold is mine):

“Following another week of weak economic data, we have cut our estimates for real GDP growth in the second and third quarter of 2011 to 1.5% and 2.5%, respectively, from 2% and 3.25%. Our forecasts for Q4 and 2012 are under review, but even excluding any further changes we now expect the unemployment rate to come down only modestly to 8¾% at the end of 2012.

The main reason for the downgrade is that the high-frequency information on overall economic activity has continued to fall substantially short of our expectations. … Some of this weakness is undoubtedly related to the disruptions to the supply chain—specifically in the auto sector—following the East Japan earthquake. By our estimates, this disruption has subtracted around ½ percentage point from second-quarter GDP growth. We expect this hit to reverse fully in the next couple of months, and this could add ½ point to third-quarter GDP growth. Moreover, some of the hit from higher energy costs is probably also temporary, as crude prices are down on net over the past three months. But the slowdown of recent months goes well beyond what can be explained with these temporary effects. … final demand growth has slowed to a pace that is typically only seen in recessions. .. Moreover, if the economy returns to recession—not our forecast, but clearly a possibility given the recent numbers …”

In Forbes, Peter Ferrara says they have tried everything in Washington except Reaganomics.

President Barack Obama, Congressional Democrats, and the Washington Establishment have now tried everything to revive America’s moribund economy…except Reaganomics.  We have seen over a trillion in Keynesian stimulus spending, record shattering deficits, easy money, bank bailouts, mortgage bailouts, low interest rates, even fake, Keynesian, “tax cuts” (based on tax credits rather than reduced rates).

Yet, at no point in the last 70 years, going back to the Great Depression, has the American economy suffered unemployment this high for this long, or such extended stagnation without a rebound or recovery.  The American economy does not lie flat on its back for years and years like this, except during the Depression.  Even in the 1970s era, the economy persistently rebounded after four worsening recession cycles.

Moreover, the historical record in America is the deeper the downturn the stronger the recovery.  Based on this history, America should be in the second year of a booming recovery by now.  Instead we have yet another failure of Keynesian economics.

Last Friday’s unemployment report showed that 3.5 years after the last recession started, still virtually no new jobs were being created, and unemployment was persistently rising again.  Prior to this, since the Great Depression recessions in America have lasted an average of 10 months, with the longest previously being 16 months.  But in June, 42 months after the last recession began, unemployment rose again to 9.2%.

The Depression has already arrived for blacks, with unemployment at 16.2% persisting for two years now.  The same is true for Hispanics, with long term double digit unemployment persisting at 11.6%, teenagers at 24.5%, black teenagers 40%. …

WSJ tells us about architecture students at Auburn with a fascinating project – a modest 500 square foot home built for $20,000. So, the cost is different, but rural Alabama residents have caught up to the life styles of those in New York City.

For many people with modest incomes, trailers are the only real option for home ownership. But trailers deteriorate quickly and depreciate over time. Six years ago, the Rural Studio, a program based in western Alabama and run by Auburn University’s architecture school, launched the $20K House Project, with the goal of producing a model home for $20,000. (At that cost, the resident’s monthly payment would be about $100 under the federal Section 502 Direct Loan program.) Last month, a team of four postgraduate students completed the latest home, the 10th one developed by the project.

The process starts each fall with research, as the students debate the pros and cons of previous designs. After months of planning, most of the construction is done within seven weeks, with $13,000 budgeted for materials and $7,000 for labor. “We’re very close to a buildable model,” says outreach instructor Danny Wicke.

The structure is a 26-by-26-foot square, with 530 interior square feet. .. 

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Veronique de Rugy graphs federal spending and borrowing.

… Today, 43 cents of every dollar spent is borrowed; this amount is about 4 times the rate in 1980. Between 2007 and 2011 alone, the rate has increased 38 cents per dollar. At this pace, the historical trend of deficit spending continues at a distressing rate. …

Spengler compares our debt to Euro debt.

… The crisis came in 2008, when leverage collapsed. Today’s euro zone debt drama is not a crisis, but a negotiation. There is an instructive comparison between the municipal debt crisis in the US and the sovereign debt crisis in Europe. The most corrupt city in the US is a refuge of angels compared to any political venue in southern Europe.

The voters who also are the taxpayers have given a mandate to politicians to ruthlessly cut expenses. In Wisconsin and Minnesota, where Republican governors (and/or legislatures) confront public-sector unions, it has come to open confrontation. In fits and starts, the system is working, because states and cities must raise money from their residents, and taxpayers vote directly for those responsible for taxes and spending.

State and local government employment is falling sharply, with 21,000 layoffs in June alone. During the past year, US cities have shed 124,000 education jobs. Borrowing by US states and cities has fallen by half this year, and municipal debt performed better than any other fixed-income asset class.

In Europe, where national governments and the bureaucrats in Brussels control spending by localities, and voters have little to do with local government budgets, there is no such responsiveness. The result is a battle between Greek recipients of government largesse and German taxpayers. There is no incentive for local constituencies to throw the bums out, for it is not the tax money of the Athenians that pays municipal salaries in Athens. Europe’s laggards must look deeply into the abyss before doing what US states and cities have done proactively.

That’s where the similarity ends. America has enough taxpayers to fund its obligations at all levels of government. The euro zone will lose 30% to 40% of its potential taxpayers by mid-century. And at some point, today’s Italian and Spanish government bonds will have about as much value as obligations signed by Emperor Romulus Augustus in the year 475 CE.

Charles Krauthammer issues a challenge.

President Obama is demanding a big long-term budget deal. He won’t sign anything less, he warns, asking, “If not now, when?”

How about last December, when he ignored his own debt commission’s recommendations? How about February, when he presented a budget that increases debt by $10?trillion over the next decade? How about April, when he sought a debt-ceiling increase with zero debt reduction attached?

All of a sudden he’s a born-again budget balancer prepared to bravely take on his own party by making deep cuts in entitlements. Really? Name one. He’s been saying forever that he’s prepared to discuss, engage, converse about entitlement cuts. But never once has he publicly proposed a single structural change to any entitlement.

Hasn’t the White House leaked that he’s prepared to raise the Medicare age or change the cost-of-living calculation?

Anonymous talk is cheap. Leaks are designed to manipulate. Offers are floated and disappear.

Say it, Mr. President. Give us one single structural change in entitlements. In public. …

Jennifer Rubin says listen to Paul Ryan.

… Ryan reiterates what House and Senate Republicans have been complaining about: “During the daily deficit talks the President has been hosting at the White House, the President has yet to offer any real spending reductions that would result in meaningful changes to our nation’s fiscal path. Until the President publicly offers a detailed spending reduction plan, all we can judge him on is his record.”

He then takes us through the numbers, which make clear that Obama has run up the bill and now wants the taxpayers to pick up the check. (“Democrats’ appropriation bills increased non-defense discretionary spending by nearly 25 percent – an 84 percent increase when you include the stimulus. The Republican House took the lead in bringing an end to this out-of-control spending and reduced non-defense discretionary spending by 7 percent.”)

He makes a critical point: The president says everything should be on the table, but Obama’s pet ideas aren’t. “The President has refused to put on the table the trillions of dollars in new spending from his health care law. The President has refused to revisit his high-speed rail boondoggles or the array of special interest ‘green energy’ spending projects. After adding trillions of dollars in new spending since he first took office, the President’s only specific policy demand is to raise taxes on American families to pay for Washington’s profligacy.”

Ryan is often the indispensable man for the Republicans, explaining in a clear and concise way the current state of our finances and how to undo the damage of runaway spending. Once it is laid out, the Republicans’ position becomes far more persuasive; Shouldn’t we undo the rampant spending before we even think about raising taxes in an economy this weak?

Scott Johnson reports on the GOP win in Minnesota.

I started following the story that I called Minnesota Cage Match for two reasons: I thought, given the constellation of forces at work, that events here would foreshadow events in Washington, and I found the slant of the incompetent media coverage driven by the Minneapolis Star Tribune to be sickening. As in the national mainstream media, Democrats here control what Glenn Reynolds calls “the master media narrative,” only more so. Let us briefly review the state of play.

In the mighty storm of the 2010 elections, Republicans won control of the Minnesota House and Senate. How long has it been since this happened? Time whereof the Memory of Man runneth not to the contrary.

At the same time, Minnesota’s three-way gubernatorial election served up disgraced Democrat Mark Dayton. Dayton inherited great wealth from the family business that he shunned. As I recall, Dayton met his first wife (a Rockefeller) in something like group therapy for guilty millionaires. Now Dayton has the whole state of Minnesota with which to work through his feelings of unworthiness.

Dayton believes in increasing taxes on “millionaires” the way most of us believe in God. It’s an article of faith that is the centerpiece of his creed. Minnesota is a state that features high income taxes, but those damned “millionaires” are somehow always escaping payment of their “fair share.” When will it ever end?

Facing a projected biennial deficit of billions of dollars, Dayton demanded an increase in income taxes. To the great annoyance of the Minnesota media, it’s a demand that was a non-starter for the Republican majorities in the state legislature. …

The Institute for Justice has another win. This time in St. Louis in a neat confluence of IJ interests; eminent domain abuse and first amendment rights.

The 8th U.S. Circuit Court of Appeals today handed down a major First Amendment victory for the right to protest government abuse.  The case is a victory for a St. Louis housing activist who grew so fed up with the government’s abuse of eminent domain that he painted an enormous protest message on the side of one of his buildings facing the interstate calling for the end of eminent domain abuse.  The city had required him to either remove the mural or get a permit to display his protest, but then it refused to issue him a permit when he applied

Jim Roos runs a nonprofit housing ministry, which works to provide housing for low-income residents of south St. Louis.  Roos became a vocal critic of the city’s use of eminent domain for private development after the city took away several of his housing ministry’s buildings not for a public use, but for private development projects. ..

Shikha Dalmia looks at immigration reform Obama style.

… The great hope from President Obama when he took office was that, having spent his formative years abroad, he’d understand—and use his bully pulpit to help the American public understand, too—that immigration is not a zero-sum game: Immigrants seeking a better life make America better off, just as his family made the countries where they lived better off. Instead, he has pandered to Republicans’ parochialism and labor’s protectionism to advance his own political prospects.

This is change, but there isn’t much hope in it—for immigrants, American workers, or the American economy.

Jeff Jacoby explains why public employee unions cannot work.

… collective bargaining in the public sector is in reality not reasonable at all. It is emphatically not like bargaining in the private sector, where unions representing labor contend with management representing owners for a share of the profits that labor helps create.

In the public sector, there are no profits to share. There are only taxpayers’ dollars, which neither government employees nor government managers create. As for the taxpayers who do create those dollars, they have no seat at the table when public unions negotiate over wages and benefits. Instead, government sits on both sides, negotiating with itself over how to spend the people’s money.

So unlike their counterparts in the private sector, public-sector unions are rarely constrained by market forces. There are limits to what labor can demand from private employers. Corporations have to make a profit to stay alive, and both sides know that if costs rise too high, the results may be lost sales, eliminated jobs, or bankruptcy. Consequently, union negotiators cannot insist on the moon, and corporate managers dare not lose sight of the company’s bottom line.

That check and balance doesn’t exist in public-sector collective bargaining. …

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John Podhoretz acquiesces with the McConnell move.

… It is, of course, a guessing game, trying to figure out who would be blamed for bad stuff. But peddling the “narrative” in which the GOP gets blamed for irresponsible and unreasonable negotiating tactics has a long history of working for Democrats. McConnell’s sense that seeming to be recalcitrant about raising the debt ceiling is more perilous than the alternative is sound pessimistic politics, which takes into account that very danger. He could be wrong. I could be wrong. But even Bill Kristol’s creative three-option plan doesn’t get to the question of the PR damage. That Obama might come to seem like a sane person in a sea of crazies may be galling to all of us who know he bears a great deal of responsibility for the severity of the current debt-ceiling crisis, but that doesn’t mean it won’t happen exactly that way.

More from Podhoretz. Seems the president is handing out more of his Netanyahu treatments.

Word is that President Obama either stormed out of budget talks today or left abruptly or spoke sharply and ended the meeting—or something. The Democrats say they’ve put $1.7 trillion in cuts on the table, and all they want is some new revenue. The Republicans say those cuts aren’t real and they’re not going to be suckered into agreeing that the cuts are real. Watching from the outside, liberals believe the White House and think that Republicans are, at best, insane and at worst, cravenly negotiating in bad faith. Watching from the outside, conservatives believe Obama has demonstrated unseriousness and petulance because he is bluffing and he is having his bluff called and he feels cornered and is lashing out.

How can these people make a deal? They can’t, not on anything substantive. And so, in the end, the much-reviled McConnell option or something very close to it—some series of temporary debt-ceiling increases that take us past Election 2012—will almost certainly be what happens.

Joel Kotkin sees the 2012 GOP opportunity.

… Some Republicans, like former Bush aide Ryan Streeter, understand this opportunity. Streeter argues for the GOP to become more economically populist approach.  He calls for an “aspiration agenda” based on policies to spark private sector economic growth and a wide range of entrepreneurial ventures. To succeed, the GOP needs a viable alternative to middle and working class voters who are losing faith in Obama-style crony capitalism but who do not want to replace it with policies focused on enhancing the bottom-lines of the top 1% of the population.

Yet at a time when people are worried primarily about paying their bills and prospects for their children, many Republicans seem determined to campaign on social fundamentalism, something that is already distressingly evident in the Iowa primary race. This may have worked in the past, in generally more prosperous times. Right now what sane person thinks gay marriage is the biggest issue facing the nation?

Neither right-wing ideology nor mindless support for corporate needs constitute a winning strategy in a nation plagued by a sense that the system works only for the rich and well-connected.  Only by focusing on working and middle class concerns can the GOP permanently separate the people from the party which pretends to represent them.

Tony Blankley makes a case for restoration. 

Some people can spot a slight in every compliment while others — the happy ones — find a compliment in every slight. So last week, as a free-market, low-tax, constitutional conservative, I happily found an apparently unintended compliment from the liberal New Republic.

It is not often that I agree with the central attack line of my sometimes media sparring partner, the New Republics’ Ed Kilgore. But in his attempt at a hit piece last week on Michele Bachmann and her stand for “constitutional conservatism” — what he thinks is an effective attack on us constitutional conservatives — I take as a badge of honor.

Putting aside his reflexive accusations against us conservatives that we are secret segregationists (making that hoary, false charge against conservatives has become an inherent part of the moral squalor of contemporary liberalism) his basic charge is that those of us who consider ourselves constitutional conservatives are really constitutional restorationists. What we really want, he charges, is the radical policy of returning to the pre-1930s view of the Constitution with its strict interpretation of the federal government’s limited powers, the originist view of individual and property rights and the removal of Franklin D. Roosevelt’s New Deal legislation. He also charges us with wanting to return to pre-Keynesian economic policies.

Well, yes. Guilty as charged m’Lord. …

New York Magazine has a good piece that explains commercial fishing regulations.

Back in the middle aughts, I took a job fishing on a commercial dragger out of Montauk. I was running a tab at a local pub when in walked a fisherman I knew. He was looking to fill out the crew for a trip leaving the following day and knew I’d been making noises about wanting to give offshore commercial fishing a try. I joined the crew as resident greenhorn, and the fisher, who knew of my eco-boy proclivities, warned me that we would be throwing back a lot of fish on the trip—the “bycatch”—and not just low-value “trash” fish, either. My friend explained that owing to the regulations we were compelled to abide, there would be fish coming onto the deck that were out of ­season, that we did not have permits for, and that we would have no choice but to throw back or we’d risk crippling fines at the dock, should fish cops from the New York State Department of Environmental Conservation greet us at trip’s end to check the fish hold. The fisherman’s admonition was, “You’re going to see a lot of stuff out there that’ll knock you back on your heels, but there’s not much we can do about it. Do your job, shut your mouth, collect your money.”

While concerned consumers fret over which fish are correct to order at their favorite seafood restaurant, heading to websites maintained by groups such as the Environmental Defense Fund for guidance on the “eco-best” and “eco-worst” fish to purchase, the truth about commercial fishing in the United States is that a regulatory framework designed to limit overfishing results in vast numbers of fish per year being scooped up on boats and dumped right back off, dead, never consumed by any ­human. Concerned about “endangered” bluefin tuna? Tell it to the tuna long-liners who’ve had to cut loose untold numbers of dead bluefins in recent years, owing to the restrictions that come with winding up on the endangered-species list. A recent ­bycatch-reduction report issued by the National Marine Fisheries Services says that “bycatch is considered to be one of the greatest threats to the sustainability of the marine environment, and bycatch affects practically every species in the ocean.”

On this early-spring trip, the quarry would be whiting, a commercial food fish that goes into lots of frozen-fish products—fish sticks and fish cakes and the like. The crew mustered on the dock at twilight, cast off the lines, and started to sail out to the edge of the continental shelf. At daybreak, the crew dropped the net into the Atlantic for our first “dip.” We towed the net for a couple of hours before “hauling back,” and that air of anticipation you apprehend on Deadliest Catch as the crab pots come up was exactly the sentiment on deck as the gears groaned under the stress of what would be a cod end bulging with fish. …

National Journal article helps you understand why Jon Huntsman should have stayed home.

… The Republican Party has nominated plenty of moderates in the post-Reagan era, including George H.W. Bush (1988), Bob Dole (1996) and John McCain (2008). One could even argue that the current GOP front-runner, Mitt Romney, fits in that category.

There’s nothing in Huntsman’s record or resume that would make it impossible for him to win the Republican nomination. All candidates have serious vulnerabilities in the primaries, including his rivals.

The challenge is how a candidate overcomes such weaknesses. Those who adapt and grow tend to do well. But all signs suggest that Huntsman has not only failed to highlight his conservative bona fides, he is doubling down on his vulnerabilities.

The biggest problem with Huntsman’s campaign isn’t his centrist ideology; it’s his campaign’s tactics. Huntsman has decided to ignore the fundamental rule of politics—a campaign is about contrasting your record against those of your opponents. Instead of taking on President Obama, he’s praised Obama’s good intentions and avoided outlining many areas of disagreement. He’s run to the left of the president on Afghanistan, calling for faster and deeper troop withdrawals. And at a time when voters are hungry for solutions, he offered a platitude-filled kickoff speech that barely touched on the economic problems that Americans want solved.

This is a Republican Party that wants head-on confrontation with Obama, but Huntsman is selling détente and civility. It’s an electorate that wants a candidate who identifies with the struggles that Americans are dealing with. Instead, his introductory campaign video focused on his love of motocross—an image of recreation at a time when the country is facing major economic pain. Huntsman is also courting independents in the New Hampshire primary, whom he assumes are in the mold of Michael Bloomberg but are as disaffected as any group out there. (In the latest July Granite State poll, 61 percent of independents said the nation was headed in the wrong direction, with a 47 percent plurality disapproving of Obama.) …

WSJ has historian Andrew Roberts review a new book on Truman’s bomb decision. At the end of World War II, our kill ratio when fighting Japanese was 10 to 1. If 500,000 Americans would be killed invading Japan and the ratio held, 5,000,000 Japanese would be killed if Truman failed to use the bomb. Roberts did not make this argument and there is no indication it exists in the book. The War is Pickerhead’s wheelhouse, so just saying Truman saved Japanese lives using the bomb. 

In the last few weeks of the Truman administration in 1953, the president attended a dinner at the British embassy in Washington in honor of Winston Churchill, who had recently been returned to the prime minister’s post. At one point in the dinner, Churchill posed a question to Truman: Would he have an answer ready when the two men stood before Saint Peter and had to account for their role in dropping atomic bombs on Japan? The scene is described in “The Most Controversial Decision” by the Rev. Wilson Miscamble, who notes that President Truman understandably didn’t much appreciate this line of conversation. The subject was swiftly changed, but if Truman ever did have to offer up an explanation at the Heavenly Gates, it could hardly have been more persuasive or succinct than the one rendered in this quite superb little book.

At the time when the atomic bombs were dropped in August 1945, Truman’s decision was anything but controversial—it was supported by almost everyone on the Allied side, since the attacks had brought to an immediate end a war that had cost the lives of more than 50 million people. It was only after the war was safely won that the morality of killing 140,000 Japanese in Hiroshima and a further 74,000 in Nagasaki started to be questioned. An article in the New Yorker in 1946 touched off the second-guessing, followed by an avalanche of criticism in the 1960s. The “it wasn’t necessary” crowd has kept up a steady drumbeat ever since …

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Jennifer Rubin treats us to Mitch McConnell’s speech from yesterday.

“Incredibly, for those of us who had been calling for action on this issue day in and day out for about two years, the President tried to put the burden on us. With the nation edging closer to the debt limit deadline, the President retreated behind the poll-tested rhetoric of class warfare.

“At a moment when we needed leadership the most, we got the least. The financial security of the nation was being gambled on the President’s wager that he could convince people our problems would be solved if we just all agreed to take it out on the guy in the fancy house down the street.

“In my view, that was the saddest commentary on the status of the leadership at the White House.

“And I’m proud of the fact that Republicans refused to play along.

“We stood our ground. We know that what Americans need right now is for government to make job creation easier, not harder. And we said so. At a time when 14 million Americans are looking for work, we refused to support a tax hike. We supported jobs and economic growth instead.

“For more than two years now, Republicans in Washington have stood united in the belief that America would never recover from the economic crisis that struck our nation three years ago, so long as some in Washington persisted in the mistaken belief that government had the cure.”

Wall Street Journal Editors like Mitch McConnell’s debt limit plan.

Republican Senate leader Mitch McConnell said yesterday he’s concluded that no deal to raise the debt ceiling in return for serious spending restraint is possible with President Obama, and who can blame him? We’ve never thought the debt ceiling was the best leverage for a showdown over the entitlement state, and now it looks like Mr. Obama is trying to use it as a way to blame the GOP for the lousy economy.

This may have been the President’s strategy all along: Take the debt-limit talks behind closed doors, make major spending cuts seem possible in the early days, but then hammer Republicans publicly as the deadline nears for refusing to raise taxes on business and “the rich.”

This would explain the President’s newly discovered fondness for press conferences, which he has rarely held but now rolls out before negotiating sessions. It would also explain why Mr. Obama’s tax demands have escalated as the August 2 deadline nears. Yesterday he played the Grandma Card, telling CBS that seniors may not get their August retirement checks. Next he’ll send home the food inspectors and stop paying the troops. …

Neal Boortz on the jobs numbers.

… Here’s a little factoid about our unemployment levels.  The recession began 38 months ago.  In all previous recessions since WWII employment has risen by an average of 3.7% over that 38-month period; that’s 3.7% above the employment level at the beginning of the recession.  Under Obama employment is now 5% below what it was at the start of the recession.  That’s a swing of almost 9%.  But remember — it’s all Bush’s fault, and if it’s not Bush’s fault it’s because of the weather and gas prices.  And of course Obama’s moves to pretty much halt all exploration and expanded production on domestic oil sources hasn’t had a thing to do with gas prices. …

James Pethokoukis says don’t blame Boehner.

President Barack Obama could have done two things that might have saved his Mother of All Budget Deals.

First, he could have embraced market-centered, consumer -focused reforms to Medicare. That was about as likely as him accepting an Obamacare rollback.  Second, he could have agreed — as House Speaker John Boehner and Republicans suggested —  to sharply reduce tax rates in return for fewer special tax deductions/breaks/loopholes/subsidies. Recall that is what his own debt commission recommended. …

… Obama sees a need for a permanently bigger government and a lot more tax revenue to fund it.  Had Obama agreed with his own debt commission and Republicans, a big agreement was possible. Or he could have proposed real reforms to entitlements. But he declined and there wasn’t a mega-deal. Don’t blame Boehner for that.

John Steele Gordon on the Ignorant One.

President Obama’s press conference yesterday—in which he only took questions from left-leaning reporters apparently–contained an amazing statement. It should be noted the first two instances of the first person singular pronoun in the sentence refer to Barack Obama, President of the United States. The second two refer to Barack Obama, taxpaying citizen:

“And I do not want, and I will not accept, a deal in which I am asked to do nothing, in fact, I’m able to keep hundreds of thousands of dollars in additional income that I don’t need, while a parent out there who is struggling to figure out how to send their kid to college suddenly finds that they’ve got a couple thousand dollars less in grants or student loans.”

There is, of course, nothing whatever stopping Barack Obama, taxpaying citizen, from donating his excess income to the United States Treasury. But his statement demonstrates an astonishing economic illiteracy. To be sure, someone earning a great deal of money has an income greater than what he spends. You can only spend so much on luxurious living however hard you try, a reality so rich with comic possibilities that a 1902 novel called  Brewster’s Millions has been made into a movie no fewer than nine times.

But, unlike Scrooge McDuck, the rich do not put the excess in a vast money bin and frolic about in it. They invest it. What a concept! Where does Obama think new capital comes from, the tooth fairy? It’s nothing more than the excess of income over outgo. Take away the income the rich “don’t need” and spend it on social programs, and capital formation in this country drops to zero.

James Pethokoukis wants to know when the government will eat its peas, shows us the unemployment rate they don’t want us to know about, and says default is unlikely.

Niall Ferguson on the fire this time.

… What all the Indignant have in common is the refusal to address squarely the problem that nearly all Western countries face. That problem is that the welfare systems that evolved in the mid-20th century are unaffordable under the demographic and economic circumstances of the 21st century. The financial crisis has merely exacerbated what was already a severe structural crisis of public finance, boosting deficits while slowing growth.

The scale of the challenge ranges from the really, really hard to the absolutely impossible. According to the Organization for Economic Cooperation and Development, just to stabilize its debt the U.S. government needs to turn its current primary deficit of 7 percent of gross domestic product into a primary surplus of 1.4 percent. That’s roughly double the fiscal squeeze Greece needs to make. …

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Mark Steyn spots the motto of the nanny state.

I think we ought to be harder when minor functionaries of a failed leviathan reveal themselves to have a defective understanding of the role of government in free societies. Steven Chu, the Energy Secretary who came into office saying “we have to figure out how to boost the price of gasoline to the levels in Europe“, has now offered up another soundbite for our times. On Friday, he defended the ban on Edison’s iconic incandescent in economic terms:

… “We are taking away a choice that continues to let people waste their own money.” …

Krauthammer says the president’s position is farcical.

… All of a sudden he is a man who wants to be the one to cut the deficit and the debt. Its a farce. You can see it in the threat he made where he said I will not sign short-term extension. Let’s say we are in negotiations and we are approaching and we want something real like tax reform which takes a few months. And Republicans pass a tax reform — pass a debt ceiling increase for say three months to allow negotiations. He says he will veto it because he is acting in the national interest; has to be a big deal.

I think the Republicans ought to call the bluff on this. …

Jennifer Rubin noticed Obama agrees with Paul Ryan about Medicare.

At his news conference President Obama explained:

“The vast majority of Democrats on Capitol Hill would prefer not to have to do anything on entitlements. Would prefer, frankly, not to have to do anything on some of these debt and deficit problems. And I’m sympathetic to their concerns, because they are looking after folks that are already hurtin’ and are already vulnerable. And there are a lot of families out there and seniors who are dependent on some of these programs. And what I’ve tried to explain to them is number one, if you look at the numbers, Medicare in particular will run out of money, and we will not be able to sustain that program no matter how much taxes go up. I mean, it’s not an option for us to just sit by and do nothing.”

Gosh that sounds sort of like what Rep. Paul Ryan (R-Wis.) has been saying while the Democrats have been conducting the Mediscare offensive. I asked Ryan’s office for the congressman’s reaction to the president’s admission that Medicare as we know it is going away. A spokesman replied, “As the President made clear — and the Congressional Budget Office has confirmed — Medicare is on an unsustainable path. …

We devote a lot of space today to John Tamny’s review of “Reckless Endangerment.”

… The grotesque rise of Fannie Mae, along with Washington and Wall Street’s bipartisan and politically correct worship of homeownership figure prominently in Gretchen Morgenson and Joshua Rosner’s Reckless Endangerment: How Outsized Ambition, Greed and Corruption Led to Economic Armageddon. The story they tell is surely revolting, but not very well reasoned, however. Worst of all, the authors mostly missed the real story behind the most recent rush to housing.

The book will appeal to extremes. The hard right will love Reckless given their belief – despite basic evidence – that the recessionary rush to housing was caused by Fannie, Freddie, and Democrats in thrall to both. The hard left will be cheered by Reckless owing to their equally dim view that Wall Street and greed drove the housing boom. Both sides will finish the book bursting with facts and quotes that will merely confirm views already held deeply. As for those still searching for answers to explain what just happened, they still won’t know. …

… Indeed, it should be made clear that despite the myriad problems with Reckless, the idea of government subsidizing housing is truly horrifying. From a growth perspective, an investment in housing doesn’t make us more productive, won’t cure cancer or lead to efficiency-enhancing software innovations, nor will it open up foreign markets. Housing on its best day is an item of consumption – albeit a necessary one – that has little to do with real economic growth.

More to the point, housing subsidies, particularly for the poor, are quite simply cruel. In a world where capital moves at the click of a mouse, the last thing governments should be doing is subsidizing a purchase that renders those who take advantage of it less mobile in pursuit of work. …

… it’s probably worth it to lay out a few choice utterances from our politicians. When asked if the Fannie/Freddie subsidies would ultimately trap individuals in properties they couldn’t afford, Rep. Barney Frank responded with “We’ll deal with that problem if it happens.” When presented with the idea that Fannie and Freddie’s business practices might be less than safe, Frank responded with “I think we see entities that are fundamentally sound financially.” During congressional hearings about Fannie and Freddie in 2003, Frank concluded that “there has been more alarm raised about potential unsafety (sic) and unsoundness than, in fact, exists.”

Of course Frank was but one of many Democrats who carried the GSEs’ water in Congress. Rep. Maxine Waters, seeking to avoid “fundamental change” for Fannie and Freddie similarly observed in 2003 that “frankly, we were trying to fix something that wasn’t broke.”

To be fair, it should be said that the two GSEs had their Republican defenders too, including Newt Gingrich and Robert Zoellick. Zoellick, once general counsel at Fannie, regularly twisted arms in Congress to make sure the company that employed him didn’t face tougher oversight, while Newt Gingrich once stated that “Fannie Mae is an excellent example of a former government institution fulfilling its mandate while functioning in the market economy.” How anyone could claim affiliation with either party after reading this book is a mystery. …

… Throughout the book the authors spoke ill of “predatory” lending (borrowers were apparently always naïve, and never in the wrong), but as evidenced by their description of Countrywide’s actions in poorer communities, Mozilo’s firm knew well that the risks to lending in less prosperous areas were greater, and naturally his firm charged higher rates. The authors paint Mozilo’s actions with the poor as having to do with company systems that “were designed to increase costs precisely for these borrowers”, but then if they’d not done exactly as the authors describe in a negative light, they would have run into trouble much sooner than they did.

And there lies the greatest problem with Reckless. Though it will once again serve well those with political agendas on the left or right, the analysis underlying the reporting was just so weak. This showed up most notably in the authors’ frequent snarky comments about “deregulation” as the driver of so much that went wrong.

There are so many examples in a book full of major contradictions, but the basic narrative from the authors was that a “free market philosophy that had taken hold during the Reagan years and became even greater during the Clinton administration” led to a deregulatory mindset that created the mess they set out to write about. That’s a nice bit of rhetoric, but the problem for the authors was a lack of evidence supporting their claims.

Sure enough, and as the authors reported early in the book, “Because housing finance was heavily regulated, government participation was vital to the homeownership push.” Far from an episode of deregulation, it was precisely because housing finance already had the government’s fingerprints all over it that so many errors were made. Much as many may want to blame the private sector for all that’s occurred, does anyone think all these egregious errors would have been made in an unregulated environment marked by the all-important natural non-regulation that is the freedom to fail? …

… As for the individuals who choose the life of a regulator, it would be fun to hear the authors explain how those with such low ambition might credibly oversee some of the brightest financial minds in the world. After that, their very own book shows time after time (see above) how very unequal and late regulators were to every financial calamity that they describe.

In defense of those same regulators, for them to achieve what the authors’ desire they would have to possess hotlines to the future that, if they utilized them in the private sector, would make them the most brilliant and wealthiest money managers in the world. Those who support the mere notion of regulation as the cure to what ails us ascribe to those charged with implementing them superhuman powers that quite simply don’t exist.

In that case, what we face is something utterly lost on the authors, but that their book made plain if they or their editors had bothered to notice the myriad contradictions within. Simply put, the mortgage debacle they describe was the result of too much regulation, and the only way to fix what they deem problematic is to reduce regulation to one line: if you fail, you die. …

… What’s interesting is that while the authors at the book’s beginning laid out the ”cast of characters” that allegedly brought us to the brink, they oddly left out the man and his Treasury Department that played a bigger role than any of the admittedly worthless people that comprised their cast. Specifically, the authors left out President George W. Bush, and his Treasury Department that reversed the Reagan/Clinton strong-dollar policies in favor of extreme dollar weakness.

As history has regularly shown, from post-WWI Germany, to England and the U.S. in the ‘70s (despite skyrocketing rates of interest), to the decade just completed, when money loses value commodity-like assets including housing tend to rise, particularly in nominal terms. Housing is not gold-like in the sense that gold priced in all currencies tends to rise when currencies decline in value, but the historical correlation between commodity spikes and nominal housing health is very real, and was there during the Bush years for all to see. ..

National Journal says youth unemployment is at historic highs.

Here’s a fact that should give economists—and maybe President Obama’s political team—heartburn: Two years after the Great Recession officially ended, job prospects for young Americans remain historically grim. More than 17 percent of 16-to-24-year-olds who are looking for work can’t find a job, a rate that is close to a 30-year high. The employment-to-population ratio for that demographic—the percentage of young people who are working—has plunged to 45 percent. That’s the lowest level since the Labor Department began tracking the data in 1948. Taken together, the numbers suggest that the U.S. job market is struggling mightily to bring its next generation of workers into the fold.

This is a dangerous proposition, economically (for the United States as a whole) and politically (for the president). …

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Mark Steyn juxtaposes the demise of the News of The World and the lack of accountability for the debacles in Atlanta Schools and the justice department. 

Something rather weird happened in London last week. For some time, The Guardian, a liberal, broadsheet, “respectable” newspaper, has been hammering The News Of The World, a populist, tabloid, low-life newspaper, over its employees’ penchant for “hacking” the phones of Royals and celebrities – Prince Harry and Hugh Grant, for example. This isn’t as forensic as it sounds: Until recently, most British cellphones were sold with the default password set either to 0000 or 1234, and most customers never bothered to change it.

But last Monday, it emerged that The News Of The World had also hacked into the telephone of a missing schoolgirl subsequently found dead, as well as those of family members of the July 7 Tube bombing victims and of British servicemen killed in Afghanistan. Nobody much cares if the Aussie supermodel Elle Macpherson and other denizens of the demimonde get their voice mails intercepted, but dead schoolgirls and soldiers changed the nature of the story, and events moved swiftly. On Thursday, Rupert Murdoch’s son and heir announced the entire newspaper would be closed down. The whole thing. Gone.

Protesters cry out as they demonstrate against the News of the World newspaper outside News International’s headquarters in London, Friday, July 8, 2011. News of the World is accused of hacking into the mobile phones of crime victims, celebrities and politicians. News International announced Thursday that the papers is to cease publication with this Sunday’s issue to be the last.

The News Of The World wasn’t any old fish-wrap. Founded in 1843, it was by the mid-20th century the most-read newspaper in the English-speaking world, …

Jennifer Rubin with background on the debt ceiling talks.

On Saturday afternoon a Capitol Hill source let it be known that “we’re hearing the White House is demanding major, unambiguous tax hikes. To get spending caps and entitlement tweaks, greater economic pain appears to be the White House’s asking price. It is increasingly likely that we aren’t going to see a ‘big’ deal if the White House doesn’t budge. [The]Speaker looks to be holding strong.”

And indeed, early Saturday night, Speaker of the House Rep. John Boehner (R-Ohio) released a statement indicating: “Despite good-faith efforts to find common ground, the White House will not pursue a bigger debt reduction agreement without tax hikes. I believe the best approach may be to focus on producing a smaller measure, based on the cuts identified in the Biden-led negotiations, that still meets our call for spending reforms and cuts greater than the amount of any debt limit increase.” A senior House advisor told me that still left open the potential for a substantial deal with no tax hikes. “The White House says they’ll veto anything that doesn’t get us through 2012. And Boehner still says we’ve gotta cut more than we raise. So $2 trillion? $2.5?” …

Jonathan Tobin thinks the untrustworthy Dems was the biggest kink in the deal.

… since the deal is so complicated, doing it all at once was improbable if not impossible. And that meant that tax reform would have gone last. That meant trusting not only Obama but also House Minority Leader Nancy Pelosi and Senate Majority Leader Harry Reid to do help push it through after everything else was done. Given that the Democrats don’t believe in this vision and have partisan reasons for sabotaging a deal that would prevent them from ranting about evil Republicans throwing grandma over the cliff, the GOP had good reason to be distrustful.

Sooner or later, Congress will have to enact the sort of far reaching entitlement cuts and tax reform that Boehner wanted. It would have been better for the country if it had happened now rather than in the future. But the blame for this delay deserves to be pinned as much, if not more, on untrustworthy Democrats as on hard line Republicans.

Peter Wehner on the dismal jobs report.

The political class has already exhausted the adjectives describing today’s bleak/horrible/awful/God-awful/dismal/terrible/absolutely flat out terrible jobs report. The new data showed, among other things, the unemployment rate increasing to 9.2 percent from 9.1 percent even as the labor force got smaller (by more than a quarter-of-a-million people). That is an amazing and alarming phenomenon, since it demonstrates that unemployment has gone up even as the pool of workers shrinks.

The real unemployment rate increased as well, from 15.8 percent to 16.2 percent. …

Robert Samuelson is on it too.

… It isn’t clear what happened. Standard explanations for the economy’s sluggish first half of 2011 cite three causes: bad weather (flooding in the Midwest); Japan’s earthquake, which depressed auto production by disrupting supply chains; and high oil prices, which sapped consumer buying power. But all this was factored into the June job forecasts.

The question now is whether the meager job creation heralds prolonged stagnation. Many economists have predicted a rebound in the second half of the year: Zandi expects the economy to grow at a 3.5 percent annual rate, up sharply from the estimated 1.9 percent for 2011′s first half; Gault is slightly below that. Both are sticking to their forecasts. They expect the negatives of the first half to reverse: lower gasoline prices will bolster consumer spending; restored supply chains will raise auto production; better weather will permit more construction spending.

But the bleak job market raises the specter of much worse. …

Investor’s Business Daily Editors want to know if now we can call the administration’s economic policy a failure.

With unemployment now at 9.2% and job growth at a standstill, is there anyone not blinded by ideology or rank partisanship who can’t see that Obama’s spend-and-regulate economic plan has been an utter failure?

When Obama was running for office, he likened himself to Ronald Reagan. Not because he liked Reagan’s policies — he despised them — but because he saw Reagan as a transformative figure worthy of emulation.

“I think Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not,” he said during the campaign. He’s since talked endlessly about the need to “remake” the economy, and “do big things.”

Well, Obama’s been transformative all right. While Reagan rescued a country mired in hopelessness, stagflation and fear, Obama has managed, by reversing Rea-ganomics, to bring it all back again. …

Fred Barnes reacts to the president’s ideas on patent streamlining.

Streamlining our patent process? Yes, that was one of the remedies President Obama offered Friday in response to news the unemployment reached 9.2 percent in June and job growth was pitiful.

It raises once again this question: Does the president have any idea how a free market economy is supposed to work or how to fix it when it’s ailing? The answer, based on Obama’s remarks in recent months, is no and no.

The president said Americans “expect us to act on every single good idea that’s out there.” But he hasn’t acted on any of the ideas that might give the economy more breathing room and less intervention by Washington. But these ideas continue to pile up at his doorstep.

For instance, how about rolling back the wave of regulations his administration has imposed on the economy and job creators?  Nope, that idea’s not on his radar. How about delaying the implementation of his health care program that terrifies so many small businessmen? Sorry, that’s off the table. How about serious cuts in spending in areas other than defense? The very idea makes Obama nervous, even as he tries to negotiate an agreement on raising the debt limit. How about having government gobble up a smaller share of GDP, thus leaving the private sector more to work with. Forget it. …

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We open with some great news! James Pethokoukis posted on the debt ceiling negotiations early this morning. He claims Boehner walked from the administration’s deal. If true, it means there is a chance our country can someday get spending under control. It also means he acted contrary to constant exhortations from all the bien pensants (folks like David Brooks; more on that later today). Pickerhead had been pessimistic the GOP would have the strength to resist. Perhaps that was wrong. If so, we are going to want statues erected throughout the land celebrating the steadfast courage of John Boehner. 

So in the end, it was bit of a Ronald Reagan moment for John Boehner on Saturday. Just as the U.S. president walked away from a bad arms control agreement with Soviet leader Mikhail Gorbachev at Reykjavik, Iceland in 1986, the House speaker passed on President Barack Obama’s mega-debt reduction deal in Washington.

In both case, the asking price was just too high. For Reagan, it was lethal limitations on his Strategic Defense Initiative. For Boehner, it was a trillion-dollar tax distraction from America’s true fiscal threat: spending run amok: “Despite good-faith efforts to find common ground, the White House will not pursue a bigger debt reduction agreement without tax hikes.”

A GOP congressional source was a bit less diplomatic, telling me Saturday afternoon via email:

“Their fierce insistence on higher taxes is beyond bizarre.” …

Krauthammer on the debt ceiling negotiations.

Here we go again. An approaching crisis. A looming deadline. Nervous markets. And then, from the miasma of gridlock, rises our president, calling upon those unruly congressional children to quit squabbling, stop kicking the can down the road and get serious about debt.

This from the man who:

1.? Ignored the debt problem for two years by kicking the can to a commission.

2.? Promptly ignored the commission’s December 2010 report.

3.? Delivered a State of the Union address in January that didn’t even mention the word “debt” until 35 minutes in.

4.? Delivered in February a budget so embarrassing — it actually increased the deficit — that the Democratic-controlled Senate rejected it 97 to 0.

5.? Took a budget mulligan with his April 13 debt-plan speech. Asked in Congress how this new “budget framework” would affect the actual federal budget, Congressional Budget Office Director Doug Elmendorf replied with a devastating “We don’t estimate speeches.” You can’t assign numbers to air.

President Obama assailed the lesser mortals who inhabit Congress for not having seriously dealt with a problem he had not dealt with at all, then scolded Congress for being even less responsible than his own children. They apparently get their homework done on time.

My compliments. …

Jennifer Rubin watched the Rose Garden speech after the jobs disaster.

Following the release of the dreadful jobs numbers, President Obama appeared in the Rose Garden this morning. However, it was entirely unclear why he was there or what his plan is for digging the economy out of the deep hole in which we find ourselves.

The speech, if you can call it that, seemed to be a disconnected collage of one-liners and excuses. …

Paul Greenberg says the Misery Index is back.

Remember the Misery Index? It tends to reappear whenever the economy exhibits a couple of unwelcome trends in unusual tandem: not just a high unemployment rate but more inflation, too. Talk about a double whammy.

Add those two figures together and you get the Misery Index. So if you combine the current 9.1 unemployment rate with the 3.6 inflation rate, the rate of misery in the American economy is 12.7. The country hasn’t seen that kind of number in almost 30 years.

The president indelibly associated with the Misery Index is Jimmy Carter, who made a talking point of it in the long-ago presidential election of 1976. He said the index was too darned high — it stood at a painful 13.6 percent back then. But by the time Mr. Carter ran for re-election as president in 1980, he had managed to raise it to almost 22 percent. And he would lose the White House to Ronald Reagan.

The Misery Index stayed under double digits from the early 1980s and the booming Reagan Years of the 1980s till the Great Recession struck in 2008. Now it’s moved into Jimmy Carter territory, and that’s not good news for Barack Obama. Or the country. …

Ed Driscoll of Pajamas Media says the private jet industry is just the latest to hammered by this president.

So starting as a presidential candidate, Obama has:

Called for bankrupting the coal industry.

Raised gas prices by forcing domestic production to a crawl.

Demonized bankers and automatic teller machines.

Went to war against Fox News, talk radio, and Twitter user Kevin Eder.

Alienated Wall Street, which backed him in 2008 — and will probably do so again.

Nationalized the car industry.

Forced Chrysler to terminate 25 percent of its auto dealers.

Demonized Las Vegas.

Alinskyized the Chamber of Commerce.

Blocked Boeing from expanding into a Right to Work State.

Is busy transforming the insurance industry into the equivalent of quasi-government utilities.

Created an uncertain (to say the least) regulatory environment, making new hiring a challenging proposition.

And is now Alisnkyizing private planes, despite having temporary custody of the greatest “private” plane of all. …

Just in case there is anyone on earth who thinks David Brooks is a conservative, be aware he is the Dems favorite columnist this week. Glenn Thrush from Politico has the story.

Conservative New York Times columnist David Brooks is fast becoming the Democrats’ man of the hour, providing some of their favorite talking points of the week.

Senate Majority Leader Harry Reid cited the writer’s column published Tuesday, headlined “The Mother of All No-Brainers,” that blasted congressional Republicans for being unwilling to accept a compromise on raising the debt ceiling. And House Minority Whip Steny Hoyer, at his weekly briefing with reporters, distributed copies of the column, calling it his version of Oprah’s Book Club.

“Have you all read it?” Hoyer asked journalists, who mostly murmured yes. “God bless you all.” …

Guy Benson thinks Brooks needs a vacation. Pickerhead thinks Brooks has been out in the sun too long already.

As someone who (a) admires the intellect of faintly conservative-ish New York Times columnist David Brooks, and (b) is currently on vacation, I’d humbly submit that some R & R may also be in order for Mr. Brooks.  His new column on debt negotiations is lazy, is premised on a series of false assumptions, and — worst of all — relies on a string of strawmen that would make Brooks’ one-time political crush, Barack Obama, beam with pride.  Brooks has concluded that Republicans are the bad-faith, fanatical actors on the debt ceiling and casts Democrats as the sensible adults in the room.  Brooks’ column is so wrongheaded, it practically cries out for a thorough fisking — so away we go:
“Republican leaders have also proved to be effective negotiators. They have been tough and inflexible and forced the Democrats to come to them. The Democrats have agreed to tie budget cuts to the debt ceiling bill. They have agreed not to raise tax rates. They have agreed to a roughly 3-to-1 rate of spending cuts to revenue increases, an astonishing concession.”
Democrats have “agreed not to raise” taxes, but they also insist on “revenue increases.”  How would that work, exactly?  Brooks may protest that Democrats say they won’t insist on rate hikes, but how does that square with President Obama’s vow to raise marginal income tax rates on millions of small businesses and families when the current tax deal expires?  And how does it jibe with the White House’s recent proposal to raise taxes by $600 Billion?  Perhaps Mr. Brooks will explain this impressive feat of fiscal and rhetorical magic in his next column. …

John Steele Gordon on the blindness of the NY Times.

The British philosopher Bertrand Russell was once giving a lecture in which he stated the earth circled the sun, held in the grip of gravity. He was interrupted by an elderly woman in the audience who told him that was nonsense, and the earth rode on the back of a giant tortoise.

“What does the tortoise stand on?” Russell asked.

“Very clever, young man,” she retorted, ”very clever indeed. But it’s turtles all the way down.”

 When it comes to explaining the current fiscal difficulties facing the country, for liberals and their principal mouthpiece, the New York Times editorial page, it’s the Bush tax cuts all the way down. …

The Economist reviews a book about the good and bad of internet personalization.

ELI PARISER is worried. Why? Call a friend in another city or a foreign country, and ask them to Google something at the same time as you. The results will be different, because Google takes your location, your past searches and many other factors into account when you type in a query. In other words, it personalises the results. As Larry Page, the chief executive of Google, once put it, “the ultimate search engine would understand exactly what you mean, and give back exactly what you want.” Eric Schmidt, executive chairman of Google, muses that someday it might be possible for people to ask Google which college they should apply for, or which book to read next.

This is only one example of internet personalisation. Mr Pariser, an internet activist best known as a leading light at MoveOn.org, a progressive online campaign group, sees this as a dangerous development. Netflix, Amazon and Pandora can predict with astonishing accuracy whether you will enjoy a particular film, book or album, and make appropriate recommendations. Facebook shows you updates from the friends you interact with the most, filtering out people with whom you have less in common. “My sense of unease crystallised when I noticed that my conservative friends had disappeared from my Facebook page,” Mr Pariser writes. The result is a “filter bubble”, which he defines as “a unique universe of information for each of us”, meaning that we are less likely to encounter information online that challenges our existing views or sparks serendipitous connections. “A world constructed from the familiar is a world in which there’s nothing to learn,” Mr Pariser declares. He calls this “invisible autopropaganda, indoctrinating us with our own ideas”. …

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A Corner Post on the dedication of Reagan’s statue in London.

Intertwined American and British flags normally would seem an odd choice to celebrate Independence Day, but they waved at Grosvenor Square in London in this July 4 under special circumstances: the dedication of a statue of Ronald Reagan commemorating the centennial of his birth on the grounds of the American embassy. Comparable ceremonies abroad over the last week honored Reagan, included a Mass of thanksgiving in Krakow; another statue unveiling in Budapest; and the renaming for Reagan of the street in front of the U.S. ambassador’s residence in Prague.

The embrace of President Reagan’s memory 100 years after his birth was hardly predictable in his time. In a 1976 episode of All in the Family, Archie Bunker’s revelation that he had cast a write-in vote for Reagan for president was a laugh line. During the first two weeks of his presidency, Reagan bluntly condemned the Soviet government as amoral, and the Washington Post in turn criticized his supposedly simplistic “good-vs.-evil approach” to the Kremlin. …

Speaking of less capable presidents, Reuters’ James Pethokoukis thinks Obama has made things worse.

The Republican charge is a body shot aimed right at the belly of President Barack Obama’s re-election effort: He made it worse.

No, not that White House efforts at boosting the American economy and creating jobs and “winning the future” were merely inefficient or wasteful, which they certainly were. Even Obama finally seems to understand that. “Shovel-ready was not as shovel-ready as we expected,” he joked lamely at a meeting of his jobs council.

Rather, that the product of all the administration’s stimulating and regulating is an economy that’s in significantly worse competitive and productive shape than when Obama took the oath in January 2009. He was dealt a bad hand, to be sure – and then proceeded to play it badly. …

… Elections have results. So do bad policies. Obama’s choices on taxing and spending and regulating, sorry to say, seem to have made things worse.

Pethokoukis gives us a graphic illustration of the results of the administration’s foolishness. This is a graph of the employment rate recovering from recessions since the 1960′s.

Peter Wehner says those bad policies have human consequences.

According to the Department of Labor, a smaller share of 16-19-year-olds are working than at any time since records began to be kept in 1948. Less than one-quarter of teens (24 percent) have jobs, compared to 42 percent in the summer of 2001. And in a story in the Wall Street Journal, we read this:

“Two years ago, officials said, the worst recession since the Great Depression ended. The stumbling recovery has also proven to be the worst since the economic disaster of the 1930s. Across a wide range of measures—employment growth, unemployment levels, bank lending, economic output, income growth, home prices and household expectations for financial well-being—the economy’s improvement since the recession’s end in June 2009 has been the worst, or one of the worst, since the government started tracking these trends after World War II.”

This merely confirms what those of us at CONTENTIONS have been writing about for many months now. Still, those nine words about the recovery — “the worst since the economic disaster of the 1930s” — are arresting. And underneath the data are countless human lives that are being disrupted, traumatized, and in some cases, ruined. …

And George Will wonders who the GOP will run against “Alibi Ike?”

The Republicans’ 2012 presidential nominee will run against Alibi Ike. Lardner, a Chicago sportswriter, created that character (“His right name was Frank X. Farrell, and I guess the X stood for ‘Excuse me.’?”), who resembles Chicagoan Barack Obama. After blaming his predecessor for this and that, and after firing all the arrows in liberalism’s quiver — the stimulus, cash for clunkers, etc. — Obama seems poised to blame the recovery’s anemia on Republican resistance to simultaneously raising the debt ceiling and taxes.

So the Republican nominee’s campaign theme can already be written. In 1960, candidate John Kennedy’s theme was: “We can do better.” In 2012, the Republican candidate should say “Is this the best we can do?”

In the contest to determine who will wield those words, there have been three important recent developments: …

A Corner discussion about the well credentialed takes place between Michael Walsh and Mark Steyn. Here’s Mark;

… The “education” system is one of the biggest structural deformities in America today. It leads to later workforce participation and later family formation, both of which factor into our existentially catastrophic entitlement liabilities. And yet Obama wants every American child to go to college. What sort of “education” do you think they’ll be getting once that happens? And what value do you think that sheepskin will hold in the wider world?

The justification for this absurd prolongation of adolescence is that it opens up opportunities for the disadvantaged. But credential-fetishization has the opposite effect. Remember Ronald Reagan, alumnus of Eureka College, Illinois? Since then, for the first time in its history, America has lived under continuous rule by Ivy League – Yale (Bush I), Yale Law (Clinton), Harvard Business (Bush II), Harvard Law (Obama). In 2009, over a quarter of Obama’s political appointees had ties to Harvard; over 90 per cent had “advanced degrees”. How’s that working out for you? In my soon to be imminently forthcomingly imminent book, I point out that once upon a time America was the land where guys without degrees (Truman) or only 18 months of formal education (Lincoln) or no schooling at all (Zachary Taylor) could become president. Credentialization is shrinking what was America’s advantage – a far greater social mobility than Europe. We’re decaying into a society where 40 per cent of the population do minimal-skill service jobs and the rest run up a trillion dollars of debt in order to avoid that fate, and ne’er the twain shall meet, except for perfunctory social pleasantries in the drive-thru lane. …

Richard Epstein comments on presidential ignorance.

… Second, the president always seems to be making the wrong either/or choices. There is no connection whatsoever between the use of corporate jets and the awarding of scholarship money. The correct way to think about such a tradeoff is to ask this question: is allotting tax dollars to one type of venture preferable to allotting it to another?

The president’s failure to compare different expenditures matters, big time. During his press conference, Obama was asked about the ill-conceived decision of the National Labor Relations Board to chase after Boeing for opening a new plant in South Carolina. Naturally, the president played dumb on the question, saying that he did not know the facts and that the matter was properly before “a judge”—i.e. the National Labor Relations Board—to decide. But here is what he should have said if he had the courage to own up to his own decisions:

“Right now, Lafe Solomon, my acting General Counsel of the NLRB, has decided to chase after Boeing for the temerity of seeking to open up a new plant in South Carolina in order to escape the risk of union strikes back in Seattle. Economic downturns create hard political choices. I think that it is wise for me as your president to spend your hard-earned tax dollars harassing a company whose increased profits from doing business in South Carolina could actually increase tax revenues. We have to get our priorities right, and mine are simple. Stay true to my union supporters, even if going after Boeing means losing money that could be spent on funding scholarships that let poor kids to go to college or to make sure that the food supply is safe against E. Coli infections.”

Unfortunately, you will never hear this level of candor in any presidential press conference. …

Contentions’ Alana Goodman reports the Jewish vote is moving away from Obama.

There was a lot of attention given to a Gallup poll yesterday showing Jewish approval for President Obama has remained fairly steady at around 60 percent since the beginning of the year (though it has also dropped by 20 points since 2009). But another poll released yesterday, taken by conservative strategist Dick Morris, found a shockingly low 56 percent of Jewish Americans said they would vote to reelect Obama over a generic Republican candidate if the elections were held today.

Considering the fact 78 percent of Jewish voters cast a ballot for Obama in 2008, this seems like a staggering — and almost unbelievable — drop in support. But here’s one reason to take it seriously: presidential approval ratings often find more support for the president than generic match-ups. …

… A few final takeaways from both polls: Gallup’s was of 350 Jewish Americans, and had a margin of error of plus or minus 7 percent. In comparison, Morris’ poll was of 1,000 Jewish voters, and had a margin of error of plus or minus 3 percent. Morris’ seems to have an edge here, which is certainly something to keep in mind as you compare both surveys.

John Tamny notes the results of tapping the oil reserves.

On Wednesday, June 22nd, the price of oil closed at $95.41. The following day President Obama announced to great fanfare the release of 30 million barrels of crude over the next 30 days from the Strategic Petroleum Reserve (SPR) with an eye on reducing oil’s price.

Mildly sentient minds with a basic sense of oil-price history knew it wouldn’t work, and sure enough, one week later – yesterday – oil closed at $95.25. As of today oil is trending down to $94/barrel, but this can be chalked up to Treasury Secretary Tim Geithner’s looming resignation. As this piece will make abundantly clear, the price of oil is a dollar phenomenon, and with a weak dollar Treasury Secretary getting ready to depart, gold is down $19/ounce in concert with increased dollar strength, thus helping to explain oil’s slight weakness relative to yesterday. …

… Priced in gold, the most stable measure of value known to mankind, oil’s price has remained mostly the same over the last 40 years. An ounce of gold bought 15 barrels oil in 1971, 15 barrels in 1981, and it buys 15 barrels today. …

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The first three items today look at the prospects for our country. We start with Toby Harnden and the United States of Gloom.

Across America today, people will gather for barbecues in their backyards, parades through their towns and firework displays lighting up the night sky.

They’ll be celebrating Independence Day – the birthday of the United States and the 235th anniversary of shaking off the oppressive yoke of British rule.

On this day in 1776 a group of 13 colonies broke away to found a new nation free to govern itself as it saw fit, pledging that each citizen would have the unalienable right to “life, liberty and the pursuit of happiness”. A nation, as Americans are apt to declare without equivocation, which became the greatest on the face of the earth.

That’s the good news. On the flip side, however, a country whose hallmark has always been a sense of irrepressible optimism is in the grip of unprecedented uncertainty and self-doubt.

With the United States mired in three foreign wars, beaten down by an economy that shows few signs of emerging from deep recession and deeply disillusioned with President Barack Obama, his Republican challengers and Congress, the mood is dark.

The last comparable Fourth of July was probably in 1980, when there was a recession, skyrocketing petrol prices and an Iranian hostage crisis, with 53 Americans being held in Tehran.

Frank Luntz, perhaps America’s pre-eminent pollster, argues that his countrymen are much more downbeat now than in 1980. “The assumption with the Carter years was that it was a failure of the elites, not the system. We thought the people in charge screwed up. We didn’t blame ourselves.” Remarkably, many Americans think things will only get worse and the good times will never return. …

A columnist for the Financial Times says the problems here and in Europe are similar.

In Washington they are arguing about a debt ceiling; in Brussels they are staring into a debt abyss. But the basic problem is the same. Both the US and the European Union have public finances that are out of control and political systems that are too dysfunctional to fix the problem. America and Europe are in the same sinking boat.

The debt debates underway in the US and the EU are so inward-looking and overwrought that surprisingly few people are making the connection. Yet the links that make this a generalised crisis of the west should be obvious.

On both sides of the Atlantic, it is now clear that much of the economic growth of the pre-crisis years was driven by an unsustainable and dangerous boom in credit. In the US it was homeowners who were at the centre of the crisis; in Europe, it was entire countries like Greece and Italy that took advantage of low interest rates to borrow unsustainably.

The financial crash of 2008 and its aftermath dealt a blow to state finances, as public debts soared. In both Europe and the US this one-off shock is compounded by demographic pressures that are increasing budgetary pressures, as the baby-boomers begin to retire. …

An antidote to this pessimism comes from Walter Russell Mead as he appears in the Wall Street Journal. We have him here often from his blog. It is nice to have his work subjected to WSJ editors. 

It is, the pundits keep telling us, a time of American decline, of a post-American world. The 21st century will belong to someone else. Crippled by debt at home, hammered by the aftermath of a financial crisis, bloodied by long wars in the Middle East, the American Atlas can no longer hold up the sky. Like Britain before us, America is headed into an assisted-living facility for retired global powers.

This fashionable chatter could not be more wrong. Sure, America has big problems. Trillions of dollars in national debt and uncounted trillions more in off-the-books liabilities will give anyone pause. Rising powers are also challenging the international order even as our key Cold War allies sink deeper into decline.

But what is unique about the United States is not our problems. Every major country in the world today faces extraordinary challenges—and the 21st century will throw more at us. Yet looking toward the tumultuous century ahead, no country is better positioned to take advantage of the opportunities or manage the dangers than the United States.

Geopolitically, the doomsayers tell us, China will soon challenge American leadership throughout the world. Perhaps. But to focus exclusively on China is to miss how U.S. interests intersect with Asian realities in ways that cement rather than challenge the U.S. position in world affairs.

Change of subject; we’ll spend some time on the Dominique Strauss-Kahn turnabout. Bret Stephens admits to his schadenfreude 

Almost from the beginning, there was something amiss in the case of People v. Dominique Strauss-Kahn. This was the very specific way in which the managing director of the International Monetary Fund was alleged to have forced himself upon a maid in his pricey Times Square Sofitel suite. More than a few people must have pondered the one-word question—really?—that might have cut short the prosecution’s case before it got rolling.

Then again, who would have dared ask this in print or on air? And who really wanted to, anyway?

Let me confess: I was pretty much delighted by the way L’Affaire DSK seemed to be playing out. When the news broke last Thursday that the case against Mr. Strauss-Kahn was falling apart—that his accuser was a serial liar, a prostitute according to the New York Post, with a $100,000 bank account and ambitions (caught on tape) to turn her supposed tragedy into a get-rich-quick scheme—my immediate reaction was: how disappointing.

Not that I ever took any joy in the thought that a presumably vulnerable woman had apparently been raped by a man with a reputation for promiscuous and predatory appetites.

But I did enjoy the thought of this mandarin of the tax-exemptocracy being pulled from the comfort of his first-class Air France seat and dispatched to Riker’s Island without regard to status or dignity. …

Victor Davis Hanson has his DSK thoughts.

… If the preponderance of evidence in the accuser’s past soon undermines her credibility to such an extent that her word cannot be used against Strauss-Kahn, then we will still be left with a controversy. It will simply be a matter, not of legality, but of Strauss-Kahn’s judgment, morality, and hypocrisy — as is usually the case in high-profile sexual scandals.

So, to recap: To prove his innocence, if the forensic evidence of a sex act turns up, Strauss-Kahn will either have to prove that a young maid he just met was quite willing, in ad hoc fashion in a few minutes between work, to have sex with an older, plump foreign stranger; or that he, in fact, paid money as he may have promised. Either way, I don’t see how that justifies the cries of vindication that we hear coming across from the Atlantic. And no need to mention, as feminists quite rightly remind us, that a past of prostitution, or sexual indiscretion, or some such skullduggery, does not ipsis factis, prove that in a moment of passion, sexual force was not used. 

So as these rumors continue to surface and are spun, we still await to learn whether DSK is guilty of a criminal act, or merely remains a fool and a hypocrite.

Andrew Malcolm has the best of late night humor

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George Will takes up the book “Reckless Endangerment.”

… The louder they talked about the disadvantaged, the more money they made. And the more the financial system tottered.

Who were they? Most explanations of the financial calamity have been indecipherable to people not fluent in the language of “credit default swaps” and “collateralized debt obligations.” The calamity has lacked human faces. No more.

Put on asbestos mittens and pick up “Reckless Endangerment,” the scalding new book by Gretchen Morgenson, a New York Times columnist, and Joshua Rosner, a housing finance expert. They will introduce you to James A. Johnson, an emblem of the administrative state that liberals admire.

The book’s subtitle could be: “Cry ‘Compassion’ and Let Slip the Dogs of Cupidity.” Or: “How James Johnson and Others (Mostly Democrats) Made the Great Recession.” The book is another cautionary tale about government’s terrifying self-confidence. It is, the authors say, “a story of what happens when Washington decides, in its infinite wisdom, that every living, breathing citizen should own a home.”

The 1977 Community Reinvestment Act pressured banks to relax lending standards to dispense mortgages more broadly across communities. In 1992, the Federal Reserve Bank of Boston purported to identify racial discrimination in the application of traditional lending standards to those, Morgenson and Rosner write, “whose incomes, assets, or abilities to pay fell far below the traditional homeowner spectrum.” …

History lesson from Democracy in America blog.

… Maybe next time Ms Bachmann discusses this issue, she can gives some credit to Jay, who, in addition to co-authoring The Federalist and serving as the first Chief Justice of the Supreme Court, actually put an end to slavery in New York.

Or how about a shout-out to Gouverneur Morris, the man who actually wrote the final draft of the Constitution? That ought to be a pretty impressive credential to any self-described “constitutional conservative”. Here’s what Morris said, to his eternal credit, on the idea of counting slaves as 3/5 of a person for the purpose of determining representation in the House:

“Upon what principle is it that the slaves shall be computed in the representation? Are they men? Then make them citizens and let them vote. Are they property? Why then is no other property included? The houses in [Philadelphia] are worth more than all the wretched slaves that cover the rice swamps of South Carolina….The admission of slaves into the representation when fairly explained comes to this: that the inhabitant of Georgia and South Carolina who goes to the coast of Africa and, in defiance of the most sacred laws of humanity, tears away his fellow creatures from their dearest connections and damns them to the most cruel bondages, shall have more votes in a government instituted for the protection of the rights of mankind than the citizen of Pennsylvania or New Jersey who views with laudable horror so nefarious a practice.” …

Fourth of July message from Thomas Sowell.

… Some clever people today ask whether the United States has really been “exceptional.” You couldn’t be more exceptional in the 18th century than to create your fundamental document — the Constitution of the United States — by opening with the momentous words, “We the people…”

Those three words were a slap in the face to those who thought themselves entitled to rule, and who regarded the people as if they were simply human livestock, destined to be herded and shepherded by their betters. Indeed, to this very day, elites who think that way — and that includes many among the intelligentsia, as well as political messiahs — find the Constitution of the United States a real pain because it stands in the way of their imposing their will and their presumptions on the rest of us.

More than a hundred years ago, so-called “Progressives” began a campaign to undermine the Constitution’s strict limitations on government, which stood in the way of self-anointed political crusaders imposing their grand schemes on all the rest of us. That effort to discredit the Constitution continues to this day, and the arguments haven’t really changed much in a hundred years.

The cover story in the July 4th issue of Time magazine is a classic example of this arrogance. It asks of the Constitution: “Does it still matter?”  …

James Pethokoukis blogs on the president’s presser.

… Maybe the biggest economic issue of the year, other than the anemic recovery, is the National Labor Relations Board attack on Boeing and its decision to open an aircraft assembly line in right-to-work South Carolina. This de facto attempt to impose wage controls on one of America’s largest exporters by limiting where it can do business is a dagger aimed at the heart of the American free enterprise system. But here, sadly, is the president again leading from behind:

“Essentially, the NLRB made a finding that Boeing had not followed the law in making a decision to move a plant.  And it’s an independent agency.  It’s going before a judge.  So I don’t want to get into the details of the case.  I don’t know all the facts.  That’s going to be up to a judge to decide.”

Who knows, maybe the president just has something against jet airplanes,  akin to his apparent dislike of those job-killing ATMs. But this seems certain: Obamanomics took flight in 2009 as a purist Keynesian experiment in economic management from high above. The ultimate Dreamliner for Democrats. Now, two-and-a-half-year later, it’s begun its sputtering descent.

Even Evan Thomas of Obama is “sort of (a) God” has fallen out of Obama love. Ed Morrissey has the story.

… ‘On “Inside Washington,” host Gordon Peterson asked his panel to suggest a way to overcome the current impasse and get Congress and the White House moving on a budget deal. Thomas offered up a solution, but also expressed his frustration with Obama.

“Yeah, because it’s happened before – Obama has got to be President of the United States,” Thomas said. “He has to be two things. He has to make a public case of how bad is this, because he is not doing that. He’s not being honest about just how bad this is going to be — no, he was partisan. He was God [bleep] Democrat! He was just, you know – being a party guy. I applaud the energy but it wasn’t getting me anywhere. He has got to rise above that and then in private, in private – he’s got to make a deal.” …

Peter Wehner has more on the extraordinary press conference.

… In other words, the most memorable example Obama used in his press conference – the need to eliminate a tax loophole for corporate jets – is comparable to trying to dig a tunnel with a teaspoon. And it’s not simply that Obama resorts to this bit of sophistry; it is that in the process he presents himself as the only adult in Washington, America’s intrepid truth teller, our modern-day Socrates.

His intellectual dishonesty and unparalleled self-image would be difficult enough to take separately. Together, it’s all a bit much. The good news is, in the end the truth will out. And I’m betting regardless of how many false statements the president makes, regardless of how many straw men he trots out, he cannot escape the bitter fruits of his policies. In 2008, Obama relied on promises of what he would do. In 2012, he will have to rely on deeds he has done. That will make all the difference.

Events have unmasked Obama. At this juncture it looks as if the president is likely to lose his re-election bid. It’s a shame he is besmirching his public character in the process.