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Today we have admonitions from Peter Schiff on housing and stamps. Unrelated topics, except for the continuing refusal of the political class to face reality. Then for comic relief, Dave Barry’s End of the Year Review.

Peter Schiff believes that government interventions have merely postponed a full correction and recovery in the housing market.

…How has the market found the strength to stop its descent? No one is making the case that fundamentals have improved. Instead, there is widespread agreement that government intervention stopped the free fall. The home buyer’s tax credit, record low interest rates, government mortgage-assistance programs, and the increased presence of Fannie Mae, Freddie Mac and the Federal Housing Administration in the mortgage-buying business have, for now, put something of a floor under house prices. Without these artificial props, prices would have likely continued to fall.

Where would prices go if these props were removed? Given the current conditions in the real-estate market, with bloated inventories, 9.8% unemployment, a dysfunctional mortgage industry and shattered illusions of real-estate riches, does it makes sense that prices should simply fall back to the trend line? I would argue that they should overshoot on the downside.

With a bleak economic prospect stretching far out into the future, I feel that a 10% dip below the 100-year trend line is a reasonable expectation within the next five years, particularly if mortgage rates rise to more typical levels of 6%. That would put the index at 114.02, or prices 28.3% below where we are now. Even a 5% dip would put us at 120.36, or 24.32% below current prices. If rates stay low, price dips may be less severe, but inflation will be higher. …

Peter Schiff sees trouble behind a post office policy change.

The United States Postal Service announced this week that all future first class postage stamps sold will be the so–called “forever stamps” that have no face value but are guaranteed to cover the cost of mailing a first class letter, regardless of how high that cost may rise in the future. Currently these stamps are sold for 44 cents, but will increase in price if and when the Post Office hikes rates.

…But the real reason behind the permanent switch is that it allows the Post Office to hide its insolvency behind phony accounting numbers, setting itself up for a massive taxpayer financed bailout in the not too distant future.

Much the way Greece used phony accounting to qualify for euro zone inclusion, the USPS is using creative accounting to avoid making significant cuts in current wages and benefits. By offering forever stamps, the Post Office moves forward future revenues to pay current expenses. But every forever stamp sold today represents a stamp not sold in the future. The revenues booked now will not be put in escrow to deal with revenue shortfalls that are guaranteed to plague the Post Office in the years ahead. This simply kicks farther down the road any intractable fiscal problems that the USPS can’t solve through more conventional means. …

Finally, we locate Dave Barry’s End of the Year Review in the Quad Cities Dispatch.

Let’s put things into perspective: 2010 was not the worst year ever. There have been MUCH worse years. For example, toward the end of the Cretaceous Period, the Earth was struck by an asteroid that wiped out 75 percent of all the species on the planet. Can we honestly say that we had a worse year than those species did? Yes we can, because they were not exposed to “Jersey Shore.”

So on second thought we see that this was, in fact, the worst year ever. The perfect symbol for the awfulness of 2010 was the BP oil spill, which oozed up from the depths and spread, totally out of control, like some kind of hideous uncontrollable metaphor. (Or, “Jersey Shore.”) The scariest thing about the spill was, nobody in charge seemed to know what to do about it. Time and again, top political leaders personally flew down to the Gulf of Mexico to look at the situation first-hand and hold press availabilities. And yet somehow, despite these efforts,  the oil continued to leak. This forced us to face the disturbing truth that even top policy thinkers with postgraduate degrees from Harvard University — Harvard University! — could not stop it.

The leak was eventually plugged by non-policy people using machinery of some kind. But by then our faith in our leaders had been shaken, especially since they also seemed to have no idea what to do about this pesky recession. Congress tried every remedy it knows, ranging all the way from borrowing money from China and spending it on government programs, to borrowing MORE money from China and spending it on government programs. But in the end, all of this stimulus created few actual jobs, and most of those were in the field of tar-ball collecting.

Things were even worse abroad. North Korea continued to show why it is known as “the international equivalent of Charlie Sheen.” The entire nation of Greece went into foreclosure and had to move out; it is now living with relatives in Bulgaria. Iran continued to develop nuclear weapons, all the while insisting that they would be used only for peaceful scientific research, such as — to quote President Mahmoud Ahmadinejad — “seeing what happens when you drop one on Israel.” Closer to home, the already strained relationship between the U.S. and Mexico reached a new low following the theft, by a Juarez-based drug cartel, of the Grand Canyon.

This is not to say that 2010 was all bad. There were bright spots. Three, to be exact:

1. The Yankees did not even get into the World Series.

2. There were several days during which Lindsay Lohan was neither going into, nor getting out of, rehab.

3. Apple released the hugely anticipated iPad, giving iPhone people, at long last, something to fondle with their other hand.

Other than that, 2010 was a disaster. To make absolutely sure that we do not repeat it, let’s remind ourselves just how bad it was. Let’s put this year into a full-body scanner and check out its junk, starting with

January
… which begins grimly, with the pesky unemployment rate remaining high. Every poll shows that the major concerns of the American people are federal spending, the exploding deficit, and — above all — jobs. Jobs, jobs, jobs: This is what the public is worried about. In a word, the big issue is: jobs. So the Obama administration, displaying the keen awareness that has become its trademark, decides to focus like a laser on: health-care reform. The centerpiece of this effort is a historic bill that will either (a) guarantee everybody excellent free health care, or (b) permit federal bureaucrats to club old people to death. Nobody knows which, because nobody has read the bill, which in printed form has the same mass as a UPS truck.

The first indication that the health-care bill is not wildly popular comes when Republican Scott Brown, who opposes the bill, is elected to the U.S. Senate by Massachusetts voters, who in normal times would elect a crustacean before they would vote Republican. The vote shocks the Obama administration, which — recognizing that it is perceived as having its priorities wrong — decides that the president will make a series of high-profile speeches on the urgent need for: health-care reform.

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Facing a growing global population and growing energy consumption, it seems logical to assume that oil prices have increased significantly. John Tierney and other Cornucopians prove that assumption is wrong. Tierney notes he is following in the footsteps of the great Julian Simon’s famous wager with Paul “Malthus” Ehrlich. Tierney wrote about it 20 years ago in the NY Times Magazine in a 5,600 word article

…It’s true that the real price of oil is slightly higher now than it was in 2005, and it’s always possible that oil prices will spike again in the future. But the overall energy situation today looks a lot like a Cornucopian feast, as my colleagues Matt Wald and Cliff Krauss have recently reported. Giant new oil fields have been discovered off the coasts of Africa and Brazil. The new oil sands projects in Canada now supply more oil to the United States than Saudi Arabia does. Oil production in the United States increased last year, and the Department of Energy projects further increases over the next two decades.

The really good news is the discovery of vast quantities of natural gas. It’s now selling for less than half of what it was five years ago. There’s so much available that the Energy Department is predicting low prices for gas and electricity for the next quarter-century. Lobbyists for wind farms, once again, have been telling Washington that the “sustainable energy” industry can’t sustain itself without further subsidies.

As gas replaces dirtier fossil fuels, the rise in greenhouse gas emissions will be tempered, according to the Department of Energy. It projects that no new coal power plants will be built, and that the level of carbon dioxide emissions in the United States will remain below the rate of 2005 for the next 15 years even if no new restrictions are imposed.

Maybe something unexpected will change these happy trends, but for now I’d say that Julian Simon’s advice remains as good as ever. You can always make news with doomsday predictions, but you can usually make money betting against them.

Noemie Emery discusses Obamacare: liberals’ pyrrhic victory that may still be, in Emery’s words, a catastrophic success.

…A parallel line of attack will be opened up by state governments, where the new crop of governors (and state representatives) will come in quite handy indeed. Complaining that compliance with the new law would bankrupt her state, Governor-elect Nikki Haley of South Carolina urged Obama to repeal his signature act outright, and then asked for opt-outs for some of its major provisions. In Virginia, the State Senate declared it illegal to mandate that the state’s residents buy health insurance, setting up a confrontation with the federal government. In Minnesota, Governor Tim Pawlenty directed state agencies to “reject participation in Obamacare unless required by law or consistent with existing state policy.” Some states are asking for waivers to opt out of parts of the health care reform act, others are considering dropping the Medicaid program in response to the expansion the new act demands. …

…Along with the lawsuits, and fights in the House and statehouses, there seems to exist a distinct possibility that the act may collapse of its weight. Assembled in haste??—?one might say desperation??—?and larded with deals to secure votes and backing, it is a 2,000-plus page assemblage of time bombs with varying fuse lengths that are starting to blow up in succession, causing large numbers of people inconvenience, or money, or both. Almost every provision seems to have some part that conflicts with another or contrives in some way to screw up the market in ways hitherto unforeseen. Increased costs are causing employers to drop people from coverage, to charge more for coverage, or to drop drug coverage for employees’ children. Thus far, 222 waivers have been granted to members of interest groups who favor the Democrats, enabling them to opt out of parts of the plan that might become onerous. Doctors are planning to shutter their practices. The promises made by Obama?—?about being able to keep your own plan or doctor?—?are turning out to be hollow. “Firms Feel Pain from Health Law” ran a recent article in the Wall Street Journal describing the problems faced by large and middle-sized businesses in trying to understand, much less to comply with, the act. 

“There’s [an] administrative burden just to try and understand the 2,400 pages,” said one executive, describing the pain of spending so much time and money on things that aren’t helping their companies grow. …

In the NYPost, Michael Walsh comments on the MSM spin for Obama.

So the year ends with the media pushing the notion that Barack Obama — having had one of the worst years in presidential history — has salvaged both his presidency and his re-election chances with his stunning “comeback” in the dwindling hours of the lame-duck session.

Don’t believe a word of it.

If generals are always fighting the last war, then the pundits are always reaching for the last cliché. …

…try as the media might, there’s simply no way that a few lesser legislative victories translate into a refreshed political potency. When you’ve been humbled on taxes by the minority Republicans and failed to pass an omnibus budget, you’ve been beaten soundly on matters of domestic policy — a clear signal that the incoming Tea Party-infused Republican majority in the House is already having an effect. … 

Tony Blankley gives a better assessment of the lame duck session than we find in the MSM.

…In the first week or so, the president capitulated to Ronald Reagan’s supply side theory that tax cuts expand the economy, and tax increases contract it. The central policy was to not let expire the Bush tax cuts, not only because it would be tough on middle-class taxpayers, but also, the White House argued,because keeping tax rates down would be good for the economy.

…And don’t think Obama merely took a week of embarrassment for that concession in December. We economic conservatives are still cheerfully reminding the public half a century later that President John Kennedy endorsed supply side marginal tax cuts. You can bet that Republicans will be reminding the public decades from now that “even Barack Obama” agreed to supply side tax-cut theory “way back in 2010.”

This is a historical intellectual capitulation of the first order by the Democratic Party president. …

Jennifer Rubin reviews the strong opposition to Obama’s recess appointments.

On Wednesday, Obama shed any pretense of bipartisanship in making six recess appointments. As were his previous recess appointments, this batch included two individuals whose records are so controversial that they could not obtain confirmation even with 59 Democratic senators. Also included was Stephen Ford, nominated as ambassador to Syria and stymied as a forceful rebuttal to Obama’s failed Syrian engagement policy. Roger Pilon of the Cato Institute voiced objection to bypassing the Senate, arguing that: “there were credible reasons why the Senate refused to confirm the several nominees Obama has just now given recess appointments, reasons that warranted full and proper Senate confirmation hearings.” He contends that “the striking feature here is that once again, as in the lame duck session, this Congress and the president managed to put off these important matters until after the November elections, which will result in this case in officers serving without the benefit of the legitimacy that comes from Senate confirmation.” A senior adviser to a key Republican senator was more succinct: “It is an outrage.”

The most egregious appointment is undoubtedly James Cole, installed as the deputy attorney general. There were good reasons why he could not secure Senate confirmation. The Web site Main Justice explained that Sen. Jeff Sessions (R.-Ala.), the ranking Republican on the Senate Judiciary Committee, has strenuously objected to Cole’s controversial stance on the War on Terror, which Cole expressed in a 2002 op-ed. …

Sessions and other Republicans also objected to Cole’s work on behalf of AIG. Moreover, he represented a Saudi prince against 9-11 families …

…What, if anything, can be done by the imperious recess appointments of such controversial nominees? Todd Gaziano of the Heritage Foundation emails me, “The real threat (which Robert C. Byrd famously did once) is for the entire GOP caucus” to refuse to consent to any further nominees unless Obama agrees to refrain from issuing more recess appointments. Gaziano says that Republicans “could refuse to confirm another judge, diplomat, etc. until they extract their promise.” There is also the power of oversight (to grill appointees on how they intend to perform their jobs) and of the bully pulpit (to publicize the records of these nominees). But the lesson for the GOP here may be to refrain from offering too many open hands to an administration only too eager to slap them and demonstrate disdain for a co-equal branch of government.

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In the NYTimes, Sharon LaFraniere describes bleak living conditions in North Korea.

… A six-day visit to Pyongyang, North Korea’s capital, that ended last Tuesday offered carefully monitored glimpses of a land where reality and fantasy are routinely conflated. While there were no obvious signs of impending collapse or political intrigue swirling around the fate of North Korea’s ailing leader, the visit offered hints of why the North might be particularly eager now to resume international aid and trade.

For nearly four years, an unrelenting barrage of government propaganda has promised that North Korea will be strong and prosperous by 2012, the centennial of the birth of Kim Il-sung, the nation’s founder and the father of the current leader, Kim Jong-il.

That is now 18 months away. And prosperous is the last word one would use to describe North Korea’s shuttered factories, skimpy harvests and stunted children.

Perhaps with that deadline in mind, North Korea’s leaders last week made what might be a bid to reduce their isolation. They offered concessions that could help open up and limit the country’s increasingly sophisticated nuclear program.

And after promising to retaliate militarily should South Korea renew artillery drills near disputed waters, they have reacted — so far — only with words. But North Korea has made conciliatory gestures before, to extract aid at times of economic need or political transition, only to turn hostile later.

Of the nation’s 24 million citizens, the three million in Pyongyang are the most privileged. North Koreans need a special permit to live or come here. Still, signs of hardship are evident. … 

…Economists say coal production is, at best, half that of two decades ago, and Pyongyang has regular power shortages. At the elite Foreign Language Revolution School, students warmed themselves around stoves fed by coal or wood. In much of the city, residents report only a few hours of electricity daily.

…Elsewhere, especially in northern provinces, residents report that child beggars haunt street markets, families scavenge hillsides for sprouts and mushrooms and workers at state enterprises receive nominal salaries, at best. Workers in Pyongyang are said to be much better compensated. …

Jennifer Rubin blogs that liberals still don’t understand why America doesn’t want socialized medicine.

Jill Lawrence writing in Politics Daily personifies liberal cluelessness on the subject of ObamaCare:

The biggest mystery of 2010 may be Democrats’ failure to explain and sell their landmark health law, and the public’s sustained resistance to it despite the popularity of many of its components. …

A mystery? Well, yes, the left can’t fathom why people would be disenchanted with a bill that requires them to buy insurance whether they like it or not, that constitutes another weighty entitlement program, that is now acknowledged not to bend the cost curve downward and that is already causing employers to dump or change their employees’ health-care coverage. But for those of us remotely in touch with the public zeitgeist, it’s no mystery at all.

Moreover, the contention that the Democrats’ problem is a communication one is a persistent fable that underscores just how sheltered the ObamaCare spinners remain from public antipathy toward a program that, among other things, is going to slash Medicare Advantage and impose a raft of mandates on new business. Obama graced us with hundreds of speeches and press conferences, and even a health-care forum. The more the voters heard the less they liked. …

Rubin also comments on Obamacare poll numbers.

…If there is a silver lining for the White House in the CNN poll, it is that although 54 percent oppose ObamaCare, that is down five points from a high in March, while support is up to 43 percent. Yes, those are still rather dismal figures for such an “historic” piece of legislation.

…The House will hold an up or down vote on repeal. Then Senate Majority Leader Harry Reid will have a problem: does he allow a vote, thereby exposing his members to the wrath of voters? And if so and a number of those moderate Democrats bolt, where does that leave Obama’s argument that there is broad-based support for his legacy legislation?

Last time around, the White House and the Democratic leadership convinced their members to ignore the polls and vote for ObamaCare. But in the wake of a midterm election wipeout, will Democrats again defy the will of the voters? Stay tuned.

In Commentary, Tevi Troy reviews how Democrats forced Obamacare on an unwilling nation.

…The stronger case to be made, however, is that health care did in fact drive the election results. According to GOP pollster Bill McInturff, “This election was a clear signal that voters do not want President Obama’s health-care plan.” McInturff looked mainly at the battleground elections rather than including the heavily Democratic safe districts and found that in the 100 most closely contested House districts, 51 percent of voters described their votes as a message to the president on health care. In addition, more than half of independent voters told McInturff that they were voting against the health-care law. Independents supported Republicans over Democrats by a margin of 18 percent.

Another analysis, by Jeffrey Anderson, found that in “comparable districts, anti-Obamacare Democrats won reelection at twice the rate of pro-Obamacare Democrats.” According to Anderson, this meant that Democratic House members in swing districts who voted for the health-care bill “cut their chances of gaining reelection approximately in half.”

…Republicans are taking over the House of Representatives with a justified belief that the American people have given them a mandate to “repeal and replace” the health-care bill. They can’t succeed at it. Even if a repeal vote passes the House—and it is likely that such a vote will take place early in the year—Republicans will not be able to get that bill through the Democratic-controlled Senate, and President Obama would veto it in any event. As a result, House Republicans will have to spend the next two years making the case for repeal, using the tools of the majority—gavels, more staff, and subpoena power—to highlight the case.

There are, however, two possible means of repeal. There is actual legislative repeal, passed by both Houses and signed by the president, which cannot happen until 2013 at the earliest. And there is effective repeal, in which the body politic rejects the substance of the bill, seeks waivers and exemptions, supports defunding important provisions, and challenges it in court, all of which would have the effect of making the whole scheme unworkable. This could be the ultimate fate of Obama’s signature legislation. …

James Delingpole, in the Telegraph Blogs, UK, blogs about some global warming conspirators who had predicted no more snow for the UK.

…Here, for example, is a quote from a book published as recently as 2004: (H/T Ishmael2009)

…It was the traditional British winter, everyone’s dream of a white Christmas. And what no one knows – or likes to admit – is that it’s probably gone for good.

I haven’t seen snow like this for over seven years in Oxford, which isn’t too far from where I grew up. … In fact snow has become so rare that when it does fall – often just for a few hours – everything grinds to a halt. In early 2003 a ‘mighty’ five-centimetre snowfall in southeast England caused such severe traffic jams that many motorists had to stay in their cars overnight. Today’s kids are missing out: I haven’t seen a snowball fight in years, and I can’t even remember the last time I saw a snowman.

Like the Christmas snow, the holly and the ivy may soon be distant memories.

The book was called High Tide: The Truth About Our Climate Crisis. And it’s by Mark Lynas. This would be the same Mark Lynas who has done very nicely thank you out of advising the Maldives Government on its ‘climate change’ strategy…

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Mark Helprin addresses some of the problems with our declining military strength.

…The president’s point was that despite whatever dangers we may face, the military must wait for the economy. But this is not so. Rather than dragging the economy down, putting the country on a war footing in 1940 revived it. Rearmament was a super-potent organizing principle and engine of production. Between 1931 and 1940 average GDP was $77.5 billion, and average unemployment 19%. By 1944, GDP had increased 271%, to $210 billion, unemployment had dropped to 1.2%, and real personal income had more than doubled. All this despite the fact that by 1945 the country was spending just under 40% of GDP, and 86% of the federal budget, on defense, at a time when a much greater proportion of income was devoted to necessities. And subsequently the war debt was retired with relative ease even as we enabled the rebuilding of Europe and defended it for half a century.

What does this tell us about defense spending? It tells us not only that it is not a poison, it can be an elixir. It tells us that it should proceed, therefore, not according to an ahistorical false premise, but in line with what is actually required to defend the United States. It tells us that, entirely independent of economic considerations, although not a dime should be appropriated to the military if it is not necessary, not a dime should be withheld if it is. The proof of this, so often and so tragically forgotten, is that the costs of providing an undauntable defense, whatever they may be, pale before blood and defeat. As for gauging necessity, we will have to deal with the rise of China, the growing power of Russia, and the nuclearization of fanatic regimes.

The strange, suicidal conviction now fashionable among the elite is that the customary vast reserves of power with which America maneuvers in the international system and, in extremis, wields in its defense, have become irrelevant to security and detrimental to the economy. All across the country, children are growing up who, in the fire next time, may pay for this prejudice with their lives. For a nation that has lost the unapologetic drive to defend itself cannot escape the consequences no matter how deft its self-deceptions or the extent to which, in contradiction of history and fact, error is ratified by common belief. …

Roger Simon points to one item Congress can cut out of the budget – the UN. 

When I was a kid, I thought the United Nations was the most righteous and positively idealistic organization in the world. It was the hope of humanity and I worshipped it. (My father — a doctor — volunteered for WHO and I would accompany him to the New York headquarters about once a month, gawking at the colorful Third World costumes and wishing I could speak French, la langue diplomatique.)

Man, times have changed. I now regard the UN as a kind of global racket with three principal, often related, areas of, in Mafia style, special interest: propaganda for totalitarian countries, massive corruption (e.g. Oil-for-Food) and spying. …

…of all of the despicable malfeasances of the United Nations, nothing surpasses the international body’s mega-Orwellian approach to human rights known as the “World Conference against Racism, Racial Discrimination, Xenophobia and Related Intolerance,” later shortened to the “World Conference Against Racism” (WCAR), aka Durbans I, II and, now, incredible as it may seem, III.

…They are the reverse of what they pretend to be and should be labeled the “World Conference for the Promotion of Racism, Racial Discrimination, Xenophobia and Related Intolerance.” I attended Durban II in Geneva – you can see some reports here and here — and I can say personally that I have never seen anything as quite literally insane. Mahmoud Ahmadinejad was the keynote speaker of a human rights conference.

The whole thing virtually broke down when several European delegates walked out on the Iranian despot in the midst of one of his predictable anti-Semitic screeds (the US, despite some equivocation, had ultimately declined to go in the first place). UN officials ran and hid from the media after this debacle and you would think they wouldn’t want to repeat such a disgrace but… here they go again with Durban III this September… and in New York, of all places.

…Enough already. When the new Congress comes in in January, they should move to defund the UN if they persist in promoting these proto-fascistic conferences…We elected them to cut the budget. They should start with the UN.

Caroline Glick discusses Hamas and Fatah plans against Israel, and what Israel needs to do to counter them, in the Jerusalem Post.

…The Durban II conference last year in Geneva was supposed to reinvigorate the political war that was launched in 2001. But it was a bust. The only head of state to address the proceedings was Iranian dictator Mahmoud Ahmadinejad. He used the occasion to again call for the eradication of the Jewish state.

To prevent another flop, last month the Palestinians and their supporters agreed that the 10th anniversary conference will be held in New York during the opening of UN General Assembly. Their goal is to piggyback on that conference to get heads of state that are in New York already to join in their anti-Israel political war.

And they have every reason for optimism. Although Canada and Israel have announced their plans to boycott the conference, the Obama administration has been noticeably unwilling to distance itself from it.

…Israel must also rally its allies to its side. We must ask our friends in the US Congress to defund the Palestinian Authority and UNRWA. The PA is a terroristic and criminal syndicate that uses US taxpayer dollars to finance terrorism and pad the pockets of terror masters and apparachiks. UNRWA, which is supposed to be a welfare organization, openly acknowledges that it employs terrorists, allows its schools and camps to be used as jihad indoctrination centers, training camps and missile launching pads. The Congressional Research Service has stated that it is impossible to claim that US funds to UNRWA do not at least indirectly finance terror groups. …

David Harsanyi defends Sarah Palin’s comments on the government telling parents what to feed their kids.

During what I assume was an action-packed episode of “Sarah Palin’s Alaska” on TLC, the former vice presidential candidate poked some gentle fun at First Lady Michelle Obama’s ubiquitous children’s health crusade.

…when Palin claims that the Obamas do not trust people “to make decisions for their own children,” she is not unleashing some Bircher hyperbole; she is summing up the driving idea of two years of public policy and paraphrasing the first lady, who recently explained that, when it comes to eating, “We can’t just leave it up to the parents.”

…Now, Sarah Palin may not always be the most sophisticated spokesperson for conservative ideology, but she is right on the money here. With all the sneering about her comments, she might want to turn to one of her favorite authors, C.S. Lewis, who also understood that “moral busybodies” who “torment us for our own good will torment us without end, for they do so with the approval of their own conscience.”

In Contentions, Abe Greenwald reviews Gallup poll numbers on who Americans most admire.

…Now for the fun part: Guess who has the No. 2 spot. None other than George W. Bush. Normally, there’d be nothing remarkable in the last president being the second-most admired man in the country. But because the anti-Bush attack machine had so doggedly tried to paint him as a frightening historical outlier it’s stunning to see him treated like any American president…Bush only goes up from here.

…Amazing what two years of bad liberal policy will do to sharpen the assessment facilities of the American people. …

…the Democrats’ national nightmare, Sarah Palin, came in second to Hillary. Palin beat out none other than omnipresent cultural goddess Oprah Winfrey, who came in third (Both beat out First Lady Michelle Obama, who came in fourth).

To my mind, the big win goes to Palin. For all the pundit chatter about her not being a viable contender for president, the public admires her more than the most beloved media personality in the country. Like Oprah, Palin channeled her talent to connect with Americans toward its most efficient use.  The Tea Party allowed her to showcase her ability, raise her market value, and serve a cause she believes in: America. Right before the eyes of antagonistic columnists and hostile comics she became the credible face of the most transformative political movement the country has seen in decades. …

Peter Wehner comments on W’s successful book.

According to the UK’s Daily Mail, President George W. Bush’s book, Decision Points, has sold 2 million copies since it was released early last month. By way of comparison, President Clinton’s memoir, My Life, has sold 2.2 million since it was published in 2004. A spokesman for Crown, which published Decision Points, called the performance “remarkable” and said that he could not think of any other non-fiction hardback book that has sold even a million copies in 2010.

…President Bush’s memoir is extremely well done, particularly for a presidential memoir (they tend to be poorly written and not terribly revealing). It provides readers with keen insights into the decision-making process that defined the Bush presidency, from stem cells to the wars in Afghanistan and Iraq to the Freedom Agenda to AIDS and malaria initiatives and much more.

As has often been the case with this two-term president, Mr. Bush’s critics misunderestimated him. His presidency is in the process of undergoing a significant reevaluation; the success of Decision Points is simply more testimony to this.

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In the Boston Globe, Yvonne Abraham tells a heartwarming story about a teen’s service to a grateful family.

On Tuesday night, Patty and Rick Parker were in their cramped kitchen with their 8-year-old son Ben. Dinner was over. Bedtime was near.

Ben’s twin brother, Sammy, lay on a cot in the narrow hallway just outside the kitchen. Unable to see or speak or control his limbs, he coughed or let out a little moan every now and then. Rick and Patty took turns feeding Sammy, who has cerebral palsy, through a stomach tube. He cooed when they kissed his face or stroked his cheek, and when they cooed back, he opened his mouth into a wide, joyful O.

A few feet away was the narrow, winding stairway that is the family’s biggest burden lately.

Which is where 17-year-old Rudy’s simple, life-changing act of kindness comes in. …

More good news. In the Jerusalem Post, Yaakov Katz writes about the damage to the Iranian nuclear operations reportedly created by the Stuxnet virus.

…Last week, The Jerusalem Post interviewed Ralph Langer, a top German computer consultant who was one of the first experts to analyze Stuxnet’s code. It was possible the worm had set back Iran’s nuclear program by two years, Langer said.

…David Albright, president of the Institute for Science and International Security, told the Post that during a study of the Stuxnet code, he discovered that the virus caused the engines in Iran’s IR-1 centrifuges to increase and decrease their speed. The report cited an unnamed government official who claimed that Iran usually ran its motors at 1,007 cycles per second to prevent damage, while Stuxnet seemed to increase the motor speed to 1,064 cycles per second.

…Albright said that the number of centrifuges damaged – 1,000 – also appeared to indicate that Stuxnet – if it caused the breakage – was meant to be subtle and work slowly by causing small amounts of damage to the systems that would not make the Iranians suspect that something foreign – like malware – had been infiltrated into their computers. “It could be that Stuxnet was meant to be subtle to disrupt and break more and have less enriched uranium produced,” he said.

Mark Perry and Robert Dell, in the American.com, posit that the recession was due to government failure, and identify six government policies that created the most damaging incentives in the economy.

…To fully explain the banking crisis, one must account for its timing, severity, and global impact. One must also confront a startling historical contrast. … we find that in the period 1875-1913, a period of marked expansion in international trade and capital flows comparable to the last three decades, there were only four banking crises worldwide.1 By contrast, in the period 1978-2009, a period of much more extensive bank regulation, central bank intervention, government protection of depositors and other bank creditors, and government control of mortgage markets, about 140 banking crises occurred worldwide. Of these, 20 were more severe than any crisis from the earlier period of 1875-1913, in terms of total bank losses as a percent of GDP.

In answer to the questions posed above about what specific factors explain the…causes and timing of the banking crisis and the extraordinary departure from historically sound underwriting and securitization standards for residential mortgages, we identify a potent mix of six major government policies that together rewarded short-sighted collective risk-taking and penalized long-term business leadership…

Underlying all these six government policies is the underappreciated problem of government failure, a problem rooted in the absence of incentives to reconcile a policy’s social costs and benefits with the costs and benefits to the policy makers. Therefore, the banking crisis should be understood more fundamentally as a government failure than as a market or business failure.

…The crisis certainly could not have occurred without certain private firms (e.g., Citigroup, UBS, Merrill Lynch) engaging in excessive corporate short-termism (or perhaps “greed”) along the same lines as Fannie and Freddie. But greed is a timeless and universal component of human nature, and it influences the public sphere at least as much as the private sector. As such, greed has little relevance in explaining the timing and crucial facts of the recent crisis—such as why credit standards and due diligence practices in housing finance deteriorated so much more dramatically than in any other credit segment. …

…A more accurate interpretation of the financial crisis as predominantly a government failure could pave the way for real financial reforms that would contribute to both future financial stability and productivity. These reforms would include: 1) the gradual reduction of government intervention in mortgage markets through legislation such as the GSE Bailout Elimination and Taxpayer Protection Act (HR 4889), sponsored by Representative Jeb Hensarling (R-Texas); 2) a reduction in federal deposit insurance and other transparent policy rules to reduce or eliminate creditor expectations of future bailouts, especially the “too big to fail” guarantee; 3) the replacement of elaborate regulatory micromanagement with more equity capital; and 4) a monetary policy rule or quasi-rule to govern the Federal Reserve’s policy making. …

The WSJ editors comment on how Oregon raised taxes and collected less than expected.

Oregon raised its income tax on the richest 2% of its residents last year to fix its budget hole, but now the state treasury admits it collected nearly one-third less revenue than the bean counters projected. The sun also rose in the east, and the Cubs didn’t win the World Series.

…The biggest loss of revenues came from capital gains receipts. The new 11% top tax rate applies to stock and asset sales, which means that Oregonians now pay virtually the highest capital gains tax in North America. Instead of $3.5 billion of capital gains in 2009, there was only $2 billion to tax—43% less. Successful entrepreneurs like Nike owner Phil Knight don’t get rich by being fools with their money. They don’t sell tens of millions of dollars of assets when capital gains taxes go up.

…All of this is an instant replay of what happened in Maryland in 2008 when the legislature in Annapolis instituted a millionaire tax. There roughly one-third of the state’s millionaire households vanished from the tax rolls after rates went up.

If Salem officials want to find where the millionaires went, they might start the search in Texas, the state that leads the nation in job creation—and has a top income and capital gains tax rate 11 percentage points lower than Oregon’s.

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Jennifer Rubin tells us what the GOP got from the START treaty.

… All of that, along with reporting requirements concerning efforts to modernize our nuclear weapons, is quite a reversal for a president who pledge to “rid the world” of nuclear weapons.

It took a poorly negotiated treaty, a tenacious Jon Kyl and the efforts of Secretary of Defense Robert Gates to coax Obama into a reasonable position on nuclear weapons and defense. And if the Russians cheat or withdraw, we will still, if Congress holds the president’s feet to the fire, have a modern nuclear weapons system and a robust missile defense. That’s not nothing.

NY Post editors comment on the Clapper flap.

…. On Monday, Diane Sawyer asked the White House’s top anti-terrorism brains about the fallout from the sweeping arrests of 12 men in the UK early that morning.

Clapper’s response: Silence. Crickets. The sound of one career, well, imploding. Pressed by Sawyer, he admitted he simply hadn’t heard of the matter.

It was a mortifying lapse given Clapper’s position: As DNI, he oversees all 16 US intelligence agencies and serves as chief intel adviser to the president. …

IBD editors too.

James Clapper’s ignorance of a major counter-terrorist success is less distressing than why he got his job as director of national intelligence: to “Obamacize” America’s spy operations.

Why was the nation’s top intelligence official unaware in an ABC News interview this week that Britain had, many hours earlier, foiled an al-Qaida-related plot of multiple suicide bombings targeting Christmas shoppers?

The White House at first claimed Director Clapper was busy all day preventing another Korean War and getting the New START treaty ratified. It was eventually admitted he hadn’t been briefed.

Could the truth be that Clapper is too busy as mega-bureaucrat? Science fiction novelist Jerry Pournelle has an “Iron Law of Bureaucracy”: “In any bureaucratic organization there will be two kinds of people: those who work to further the actual goals of the organization, and those who work for the organization itself.”

Worst of all, “The Iron Law states that in all cases, the second type of person will always gain control of the organization.” …

Jennifer Rubin draws important conclusions from the event.

… Putting aside the hapless Clapper, this should raise a more fundamental question: Do we need the DNI post at all? The elaborate reworking of our intelligence structure after Sept. 11 has made the system more cumbersome. But has it made us safer? Well, if it’s no big deal that the DNI missed a significant terror incident, then maybe his job and many layers of bureaucracy can be eliminated.

Michael Barone takes a quick glance at the meaning of new census numbers.

For those of us who are demographic buffs, Christmas came four days early when Census Bureau director Robert Groves announced on Tuesday the first results of the 2010 census and the reapportionment of House seats (and therefore electoral votes) among the states.

The resident population of the United States, he told us in a webcast, was 308,745,538. That’s an increase of 9.7 percent from the 281,421,906 in the 2000 census — the smallest proportional increase than in any decade other than the Depression 1930s but a pretty robust increase for an advanced nation. It’s hard to get a grasp on such large numbers. So let me share a few observations on what they mean.

First, the great engine of growth in America is not the Northeast Megalopolis, which was growing faster than average in the mid-20th century, or California, which grew lustily in the succeeding half-century. It is Texas. …

You may remember in December 16th Pickings the essay by Brooks and Wehner about competing human nature narratives when time was spent debunking the “noble savage” fairy tale from Rousseau and the Marxists. We have a couple of items that perfectly illustrate “nasty, brutish and short” – the concept of natural human life of Thomas Hobbs. First a NY Times story from Northern Spain where the examination of the bones of a Neanderthal family discovers they were cannibalized.

Deep in a cave in the forests of northern Spain are the remains of a gruesome massacre. The first clues came to light in 1994, when explorers came across a pair of what they thought were human jawbones in the cave, called El Sidrón. At first, the bones were believed to date to the Spanish Civil War. Back then, Republican fighters used the cave as a hide-out. The police discovered more bone fragments in El Sidrón, which they sent to forensic scientists, who determined that the bones did not belong to soldiers, or even to modern humans. They were the remains of Neanderthals who died 50,000 years ago.

Today, El Sidrón is one of the most important sites on Earth for learning about Neanderthals, who thrived across Europe and Asia from about 240,000 to 30,000 years ago. Scientists have found 1,800 more Neanderthal bone fragments in the cave, some of which have yielded snippets of DNA.

But the mystery has lingered on for 16 years. What happened to the El Sidrón victims? In a paper this week in The Proceedings of the National Academy of Sciences, Spanish scientists who analyzed the bones and DNA report the gruesome answer. The victims were a dozen members of an extended family, slaughtered by cannibals. …

Next item making the “noble savage” advocates look like fools comes from Google. Turns out 45 people have been lynched in Haiti over the past few weeks. They were suspected of being sorcerers who spread cholera. “Nasty, brutish and short”, and ruled by superstition says Pickerhead.

Angry Haitian mobs have lynched at least 45 people in recent weeks, accusing them of spreading a cholera outbreak that has killed over 2,500 people across the country, officials said Wednesday.

The number included at least 14 suspected sorcerers previously known to have been lynched in the far southwestern region of Grand’Anse as local people feared they were spreading cholera with a magical substance. The area has been largely spared by the outbreak. …

Interesting WaPo story about Michael Jordan’s two sons who play for U of Central Florida. UCF was 10-0 at press time and broke into the top 25 rankings for the first time ever.

After sophomore guard Marcus Jordan misfired on a jump shot minutes into a Central Florida game against Miami last Saturday, a fan sitting a few rows from the court taunted gleefully.

“You’re not your father!” the man said. “Did you get a DNA test? Are you sure?”

Heckling rains every time the Knights hit the road, and Jordan’s expression never changes. His head never turns. He knows he lacks his famous father’s size and ability to hover by the rim. He wears silver Air Jordan shoes and a black Air Jordan headband, but this heir Jordan did not get all of his father’s gifts.

In many ways, Jordan isn’t like Mike at all. He sports black-rimmed glasses, a goatee and mustache, and tattoos up and down both arms. …

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Picking’s staff will be off for a bit during the holidays. Be back soon.

We start today with more interesting WikiLeaks, this time on the administration’s attitude toward Honduras. Rick Richman has great commentary in Contentions.

In the Wall Street Journal yesterday, Mary Anastasia O’Grady wrote that cables released by WikiLeaks show that the administration knew Honduran President Manuel Zelaya had threatened Honduran democracy — but supported him in order to offer President Obama a “bonding opportunity” with Venezuelan President Hugo Chavez and a chance to ingratiate himself with Latin America’s hard left.

…I have a simpler explanation — not inconsistent with O’Grady’s analysis but closer to the common theme in Obama’s foreign policy in other areas. The day after Zelaya was removed, Obama pronounced it a “coup.” That snap judgment remained American policy even as more and more facts contradicting Obama’s description emerged. After months pushing a reinstatement that virtually every element of Honduran political and civil society opposed, and even though the proper and practical solution was apparent, Obama still engaged in mystifying diplomacy, cutting off aid to a poverty-stricken ally. …

…Obama brought to the Oval Office a self-regard probably unmatched in American history. He apologized for his country while praising it for electing him. He thought that Iran could be handled with his outstretched hand; that a foreign head of state should receive an iPod with his speeches on it; that a video of him was sufficient for the Berlin Wall anniversary; that a prime minister should be summoned to the White House after-hours without press or pictures; that a Palestinian state would be created because this time they had Him. Russia and China were treated with respect, as was Iran, even as it held a fraudulent election and blew through his successive “deadlines.” But allies such as Poland, the Czech Republic, Georgia, Israel, and Britain were treated differently.

What was visited upon Honduras last year was of a piece.

Mary Anastasia O’Grady has the in-depth story on Honduras in the WSJ.

“The last year and a half of the [President Manuel] Zelaya Administration will be, in my view, extraordinarily difficult for our bilateral relationship. His pursuit of immunity from the numerous activities of organized crime carried out in his administration will cause him to threaten the rule of law and institutional stability.”

—Charles Ford, U.S. ambassador to Honduras, May 15, 2008

…In the opening summary, Mr. Ford wrote: “Ever the rebellious teenager, Zelaya’s principal goal in office is to enrich himself and his family while leaving a public legacy as a martyr who tried to do good but was thwarted at every turn by powerful, unnamed interests.” The State Department says it does not comment on classified documents.

…Though Mr. Zelaya can be “gracious and charming,” wrote Mr. Ford, “there also exists a sinister Zelaya, surrounded by a few close advisors with ties to both Venezuela and Cuba and organized crime.” He eerily observed what Zelaya opponents would repeatedly allege privately in the year to come: “Due to his close association with persons believed to be involved with international organized crime,” the president could not be trusted. “I am unable to brief Zelaya on sensitive law enforcement and counter-narcotics actions due [to] my concern that this would put the lives of U.S. officials in jeopardy.”

The insightful diplomat also recognized Mr. Zelaya’s disdain for other institutions. He “resents the very existence of the Congress, the Attorney General and Supreme Court.” That resentment rose to the surface in June 2009 when the Supreme Court ruled that a referendum on his re-election was unconstitutional. Mr. Zelaya responded by leading a mob to break into a military installation where the ballots for his initiative were being stored.

Hondurans were appalled. The Supreme Court issued an arrest warrant, the military deported him, and Congress voted to remove him from office. …

Robert Samuelson writes that state and local governments have been doing fine thanks to the stimulus, but the real fiscal headache that is coming is underfunded retirements benefits.

…All in all, the present squeeze on states and localities is overstated. The truly bad news lies in the future with massive retiree pension and health benefits that haven’t been prefunded. How big are the shortfalls? All estimates are huge, though they vary depending on technical assumptions and coverage.

…Whatever the ultimate costs, they threaten future levels of public services. The generous benefits encourage workers to retire in their late 50s or early 60s after 25 years of service. The health benefits typically provide coverage until retirees qualify for Medicare at 65. To pay for unfunded benefits, government services must either be cut or taxes raised. How much is (again) unclear. Even low estimates by the Center for Retirement Research at Boston College indicate that annual pension payments for some states could roughly double. In Illinois, they could go from 4.5 percent of spending to 8.7 percent. Covering retiree health benefits would add to that.

So support for schools, police, roads and other state and local activities is undermined by careless—or corrupt—bargains between politicians and their public-worker unions. Promises of generous future retirement benefits were expedient contract sweeteners, with most costs conveniently deferred. Even when pension contributions were supposed to be made, they were often reduced or postponed when budgets were tight. If these arrangements look familiar, they should. The U.S. auto industry adopted the same model; the costs helped bankrupt General Motors and Chrysler.

What states and localities can do about this is limited. Pension promises to existing employees are probably legally inviolate. Retiree health benefits are apparently less so and should be reduced or eliminated to limit incentives for early retirement. Even if politicians manage this arduous feat, past decisions will burden the future. Along with an unwillingness to curb Social Security and Medicare costs, America’s leaders have created another way to cheat their children.

The Daily Mail, UK, reports on snow and record cold temperatures in the UK. Any quotes from the Climate Research Unit geniuses?

Swathes of Britain skidded to a halt today as the big freeze returned – grounding flights, closing rail links and leaving traffic at a standstill.

And tonight the nation was braced for another 10in of snow and yet more sub-zero temperatures – with no let-up in the bitterly cold weather for at least a month, forecasters have warned.

The Arctic conditions are set to last through the Christmas and New Year bank holidays and beyond and as temperatures plummeted to -10c (14f) the Met Office said this December was ‘almost certain’ to become the coldest since records began in 1910. …

Just to remind everyone how pervasive the greenist conspiracy had once been, let’s take a look back. In 2000, Charles Onians reported on global warming in the Independent, UK.

…Global warming, the heating of the atmosphere by increased amounts of industrial gases, is now accepted as a reality by the international community. Average temperatures in Britain were nearly 0.6°C higher in the Nineties than in 1960-90, and it is estimated that they will increase by 0.2C every decade over the coming century. Eight of the 10 hottest years on record occurred in the Nineties.

However, the warming is so far manifesting itself more in winters which are less cold than in much hotter summers. According to Dr David Viner, a senior research scientist at the climatic research unit (CRU) of the University of East Anglia,within a few years winter snowfall will become “a very rare and exciting event”.

“Children just aren’t going to know what snow is,” he said. …

The Economist reports on an amazing cell phone milestone, and what the future holds.

SOMETIME in the next few months, the number of mobile phones in use will exceed 3.3 billion, or half the world’s population. No technology has ever spread faster around the globe: the mobile phone took less than two decades to reach this degree of penetration. But the ever-restless wireless industry has already set its sights on getting the other half connected. Two recent reports analyse how to add the “next billion” to the subscriber list. …

…Yet even as the industry strives to make handsets and services cheaper, governments keep adding costs—mainly by levying taxes and customs duties. And these are particularly high in sub-Saharan Africa, according to a report released this week by Frontier Economics, a consultancy, at the behest of the GSM Association (GSMA), an industry lobby. The average ratio of tax payments to operator revenues is 30%. On average the mobile industry, which accounts for 4% of GDP, contributes 7% of national tax revenue.

This enthusiasm for taxation is easy to explain: governments have to tax something, and mobile phones are an easy target, since operators’ billing systems do all the hard work. But treating mobile phones as a cash cow is shortsighted, says Gabriel Solomon of the GSMA, because mobile-specific taxes reduce demand. If governments did away with them and charged only VAT, tax revenues from the mobile industry would be around 3% higher by 2012, the report found, and the average penetration rate would increase from 33% to 41%. (Studies have found that in a typical developing country, an increase in mobile penetration of 10% boosts GDP growth by around one percentage point.)

Whether or not finance ministers are not convinced by such calculations, operators seem to be. Some have offered to guarantee tax revenues if mobile-specific levies are scrapped. …

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Peter Wehner comments on James Ceaser’s appellation for the political change that produced the 2010 election results.

In his excellent essay in the Claremont Review of Books, titled “The Great Repudiation,” Professor James Ceaser wrote

“The results of the 2010 election changed the landscape of American politics. … In fact, 2010 is the closest the nation has ever come to a national referendum on overall policy direction or “ideology.” … There is only one label that can describe the result: the Great Repudiation.”

To understand just how much the landscape of American politics changed, consider (as John does) yesterday’s events — a day in which the Democratic majority in Congress averted across-the-board tax increases and enacted new tax breaks for individuals and businesses and Senate Majority Leader Harry Reid was forced to pull an almost $1.3 trillion omnibus spending bill, replacing it (presumably) with a Continuing Resolution.

These were major substantive achievements by Republicans — and enormous substantive concessions by President Obama and his party. We have the Great Repudiation to thank for them.

And here’s James Ceaser’s article, from the Claremont Institute.

…The midterm election is one of the distinctive features of America’s constitutional system. By allowing an expression of voter sentiment separate from the presidential selection, midterms help supply the Congress with concrete political support for checking the president’s power. A check of this kind seems to be exactly what the public had in mind in 2010, ending liberal hopes that Obama’s presidency would inaugurate a “new” New Deal. …

…Elections in America serve two functions: a “formal” function of appointing the personnel for constitutional offices, which takes place in every election; and an “informal” function of signaling what the people want, which takes place only in certain elections, when national public sentiment has congealed into a common message or theme. The situation in Washington reflects a conflict stemming from the results of these two functions. On the formal side, the array of forces puts neither party in full control. Democrats hold the presidency, Republicans now firmly control the House, and the Senate will likely swing in ways no one can foresee. The Democrats, who now derive their power from this formal situation and rely on officials chosen in elections conducted two and four years ago, will emphasize their offices’ constitutional authority. They represent for the moment the conservative position. On the informal side, Republicans boast not just of their seats and numbers in Congress, but of the majority’s weight and power as expressed in the clear message delivered on Election Day. This claim cannot, of course, cancel the formal array of power-we are a nation governed by laws and institutions-but there is nothing amiss in reminding those in office that they cannot stray too far, too long from the majority’s wishes without straining a democratic system’s authority. Although the informal function should not be overvalued, it should not be undervalued either.

The Republicans’ case, resting on this informal claim that can always be disputed, is already under assault. Along with the Democrats’ open campaign to persuade the public that the election did not mean what Republicans thought it did, there is an allied effort underway, far more subtle, to undermine and weaken the GOP position. It comes from a group of self-proclaimed wise men who present themselves as being above the fray. These voices, acting from a putative concern for the nation and even for the Republican Party, urge Republicans to avoid the mistake of Obama and the Democrats of displaying hubris and overinterpreting their mandate. With this criticism of the Democrats offered as a testimony of their even-handedness and sincerity, they piously go on to tell Republicans that now is the time to engage in bipartisanship and follow a course of compromise. The problem with this sage advice is that it calls for Republicans to practice moderation and bipartisanship after the Democrats did not. It is therefore not a counsel of moderation, but a ploy designed to force Republicans to accept the overreaching policies of the past year-and-a-half. It is another way to defend Obama’s “change.” If Republicans are to remain true to the verdict of 2010, the message of this election cannot be merely containment; it must be roll back.

Peter Schiff says that the Fed has no other tricks left to artificially stimulate the economy. Worse yet, the quantitative easing will be bringing us inflation.

…For years, the Fed has been able to prevent market forces from correcting our growing economic imbalances by inexorably pushing rates lower. This happened in 1991, 2001, and most notably in 2008. These easing campaigns succeeded in boosting the economy in the short term by greatly increasing the amount of debt held by both the private and public sectors. As such, these episodes have allowed our economy to delay and magnify the ultimate reckoning.  

Just like a junkie who requires ever-increasing doses of heroine to achieve the same high, the Fed has needed to take rates ever lower to boost the economy after its previous stimulants had faded.

To stimulate after the bursting of the housing bubble (which itself resulted from the low interest rates used to juice the economy following the bursting of the dot-com bubble), the Fed lowered interest rates to practically zero. At that point, rates could go no lower. However, when that stimulus failed, the Fed decided to bring on the heavy artillery in the form of “quantitative easing,” or as it is known in the vernacular, “printing money to buy government debt.”

…However, the Fed’s plan backfired. The selling pressure on long-term bonds is overwhelming the Fed’s buying pressure. Spiking rates (which move inversely to price) are powerful evidence that the bond bubble has finally burst. The Fed threw everything but the kitchen sink at the bond market to force yields lower, yet they rose anyway. If bond prices failed to rise given such a Herculean effort to lift them up, there can be only one direction for them to go: down.

…What lies ahead is a new era of rising interest rates, soaring consumer prices, increasing unemployment, economic stagnation, and lower living standards. Instead of stimulating the economy, quantitative easing and deficit spending will prove to be a lethal combination. …

In Contentions, Michael Totten points out Gideon Rachman’s comment: WikiLeaks dispels many conspiracy theories about US intentions.

Gideon Rachman at the Financial Times says WikiLeaks founder Julian Assange deserves a medal rather than prison. “He and WikiLeaks have done America a massive favour,” he writes, “by inadvertently debunking decades-old conspiracy theories about its foreign policy.”

…Rachman points out that many rightists in China and Russia, and leftists in Europe and Latin America, assume that whatever American foreign-policy officials say in public is a lie. I’d add that Arabs on both the “left” and the “right” do, too. Not all of them, surely, but perhaps a majority. I’ve met people in the Middle East who actually like parts of the American rationale for the war in Iraq — that the promotion of democracy in the Arab world might leech out its toxins — they just don’t believe the U.S. was actually serious.

And let’s not forget the most ridiculous theories of all. Surely somewhere in all these leaked files there’d be references to a war for oil in Iraq if the war was, in fact, about oil. Likewise, if 9/11 was an inside job — or a joint Mossad–al-Qaeda job — there should be at least some suggestive evidence in all those classified documents. If the U.S. government lied, rather than guessed wrong, about Saddam Hussein’s weapons of mass destruction, or if NATO invaded Afghanistan to install a pipeline, this information would have to be written down somewhere. The State and Defense department bureaucracies are far too vast to have no records of what they’re up to. …

In Hot Air, Allahpundit blogs about more beneficial information from WikiLeaks.

No foolin’. So fulsomely slavish to the cause have our progressive icons become that their propaganda now makes even the Castros blush. Keep on rocking, “reality-based community.”

Incidentally, this story comes from a Wikileaks document. Second look at Assange?

[T]he memo reveals that when the film was shown to a group of Cuban doctors, some became so “disturbed at the blatant misrepresentation of healthcare in Cuba that they left the room”.

Castro’s government apparently went on to ban the film because, the leaked cable claims, it “knows the film is a myth and does not want to risk a popular backlash by showing to Cubans facilities that are clearly not available to the vast majority of them.”…

The cable describes a visit made by the FSHP to the Hermanos Ameijeiras hospital in October 2007. Built in 1982, the newly renovated hospital was used in Michael Moore’s film as evidence of the high-quality of healthcare available to all Cubans. …

Ed Morrissey has a post on an ironic turn of events.

The man who heralds himself as the vanguard of radical transparency has finally found an opacity he can support — himself.  Julian Assange’s legal team has demanded an investigation into the leak of documents from Sweden’s investigation of rape allegations after the Guardian reported on them over the weekend.  This is, of course, a Schadenfreude-tastic moment — but shouldn’t take away from the seriousness of the issue …

…Defendants facing criminal charges have the right to a presumption of innocence.  Nations have the right to expect that their internal systems for communication will remain secure, whether that be for diplomatic or military purposes.  Not all transparency is beneficial, a lesson Assange appears to be learning the hard way.

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Alain de Botton writes in the WSJ about how liberal arts education can help us live our lives.

…My own answer to what the humanities are for is simple: They should help us to live. We should look to culture as a storehouse of useful ideas about how to face our most pressing personal and professional issues. Novels and historical narratives can impart moral instruction and edification. Great paintings can suggest the requirements for happiness. Philosophy can probe our anxieties and offer consolation. It should be the job of a university education to tease out the therapeutic and illuminative aspects of culture, so that we emerge from a period of study as slightly less disturbed, selfish and blinkered human beings. Such a transformation benefits not only the economy but also our friends, children and spouses.

…The claim that culture can stand in for scripture—that “Middlemarch” or the essays of Schopenhauer can take up the responsibilities previously handled by the Psalms—still has a way of sounding eccentric or insane. But the ambition is not misplaced: Culture can and should change and save our lives. The problem is the way that culture is taught at our universities, which have a knack for killing its higher possibilities.

The modern university has achieved unparalleled expertise in imparting factual information about culture, but it remains wholly uninterested in training students to use culture as a repertoire of wisdom—that is, a kind of knowledge concerned with things that are not only true but also inwardly beneficial, providing comfort in the face of life’s infinite challenges, from a tyrannical employer to a fatal diagnosis. Our universities have never offered what churches invariably focus on: guidance.

…Because this situation cries out for a remedy, a few years ago I joined with a group of similarly disaffected academics, artists and writers and helped to start a new kind of university. We call it, plainly, the School of Life, and it operates from a modest space in central London. On the menu of our school, you won’t find subjects like philosophy, French and history. You’ll find courses in marriage, child-rearing, choosing a career, changing the world and death. Along the way, our students encounter many of the books and ideas that traditional universities serve up, but they seldom get bored—and often come away with a different take on the world. …

David Harsanyi comments on where the individual mandate leads.

…At some point in the next few years, the Supreme Court will decide whether coercing individuals to purchase a product is constitutional. That’s when we’ll find out if the document is worth anything at all anymore.

…Yet, if this mandate stands, any political group need only cobble together a majority of elected officials, find some open-minded judges dedicated to “doing the right thing” rather than upholding their oath, and government can be handed unlimited power to control not only what we can buy but what we must buy.

…As Federal District Court Judge Henry Hudson, who found the mandate unconstitutional recently, points out, “The same reasoning could apply to transportation, housing, or nutritional decisions. This broad definition of the economic activity subject to congressional regulation lacks logical limitation.”

Maybe that’s the point. Force someone to buy a gun? Awful. Force someone to buy insurance? A victory for fairness. The limits of this philosophy depend solely on the subjective ideals and imagination of powerful advocates. …

In Volokh Conspiracy, Randy Barnett highlights commentary from Glenn Reynolds on two more “eminent domain” thefts. Kelo v. New London continues to allow government and the well-connected to steal land from others. This time it is Columbia University stealing from small businesses near the school.

The takings clause reads “nor shall private property be taken for public use without just compensation.” When Kelo v. City of New London upheld the power of takings for economic development, many used the political backlash to that decision as a vindication of “judicial restraint.” See, we were told, this sort of dispute should be left to the political sphere. Now, as Glenn Reynolds notes in his New York Post column, Columbia University has succeeded in its quest to take two businesses to incorporate their land into the university’s footprint:

[T]his week, . . . the last legal barrier (a possible US Supreme Court review) to Columbia University’s efforts to condemn and seize two businesses — Tuck-it-Away Self-Storage and a gas station owned by Gurnam Singh and Parminder Kaur in West Harlem — vanished.

Columbia said the condemnation was necessary to support the university’s “vision” for a new campus; school President Lee Bollinger called the victory “a very important moment in the history of the university.”

It was an important, if not especially proud, moment for Columbia — but it was surely a bigger moment in the lives of those West Harlem business owners, as their property gets taken away to promote the “vision” of what is, in fact, a multibillion-dollar corporation servicing the daughters and sons of the wealthy, the powerful and the connected.

Traditionally, the “public-domain” power was used to acquire property needed for things like roads and bridges. It’s still often defended in those terms, but the “public use” required for such takings has now been interpreted by courts to include pretty much anything the government wants to do with the property — including handing it over to someone else who just happens to be wealthier or better-connected than the original property holder…

Jennifer Rubin looks at the DC drama last week.

This past week was an extraordinary one for politics watchers. It had the feel of a national political convention week — all the pols, the pundits, the excitement of non-stop news. (START is dead! No it lives! The omnibus spending bill is monstrous! Oh my, that’s dead, too.) But unlike a political convention that simply chooses leaders and quickly fades into the atmosphere (Quick: who were the keynote speakers for the two parties in 2008?), the week had meat — constitutional law (wow, the Commerce Clause might have some bite left in it), ideological watersheds (we are all Bush tax cutters now), social breakthroughs (in a few years, will anyone care about any issue regarding gays?), and foreign policy intrigue (just how desperate is the administration to prostrate itself before the Russians?).

Big things happened. President Obama and Senate Minority Leader Mitch McConnell (I typed “majority leader” and had to correct, but he surely seems like the one running the place) may be the next Ronald Reagan-Tip O’Neill political odd couple. ObamaCare, by a combination of judicial surgery (a mandate-ectomy) and a starvation diet (not the Zone Diet, but the DeMint-McConnell-Boehner-Ryan Squeeze), suddenly seemed in peril.

The week’s events also confirmed that Congress, not the preliminary 2012 Republican primary scramble, will be where the action is for conservatives over the next few months. None of the often-mentioned contenders are anxious to get into the race, although preening for the base is very much underway (Mitt Romney, Sarah Palin and Rep. Mike Pence, unlike Rep. Dennis Kucinich, opposed the tax agreement because you can never say “yes” and impress the hardest of the hardliners.) …

Bill Kristol entertains us with the Beltway version of the Night Before Christmas.

’Twas the week before Christmas, and all through
the House

The liberals were stirring, and boy did they grouse!

While earmarks were hung on the Reid bill with care

In hopes that the public would not see them there,

The “rich folks” were nestled all snug in their bed—

In hopes they’d be spared, like the president said—

While Nancy in kerchief and Bernie in cap

Were hunting for corpses that Congress could tap. …

Michael Goodwin, in the NYPost, looks at all the Christmas presents the country has been receiving.

…From the federal courts to the halls of Congress, the counterattack against Big Government claimed its first victories just in time for Christmas. Casualties were suffered only by those who forgot that majorities still count in a democracy.

Themes don’t get any more American than that.

The bipartisan support for extending the Bush tax cuts was the first big shock wave of the November election, but not the only one.

Senate Majority Leader Harry Reid was forced to withdraw his earmark-larded $1.2 trillion spending bill because he didn’t have the votes.

That will give the new Congress, under public marching orders to trim spending and ban earmarks, its chance to whack away. …

In the WSJ, Kimberley Strassel says that we have Mitch McConnell to thank for the defeat of the omnibus monstrosity, and for keeping nine Republican senators from succumbing to temptation.

…This week Democrats unveiled a $1.2 trillion omnibus, legislation as pure an insult to the electorate as it gets. It was a 1,924-page monstrosity that nobody had time to read. It took 11 spending bills that Democrats couldn’t be bothered to pass individually and crammed them into one oozing ball of pork and bad policy, going beyond even the obscene budget of 2010.

Yet to this legislative Frankenstein Democrats carefully attached the spenders’ equivalent of crack cocaine. To wit, omnibus author and Hawaii Democrat Daniel Inouye dug up earmark requests that Senate Republicans had made in the past year (prior to their self-imposed ban) and, unasked, included them in the bill. He lavished special, generous attention—$1 billion worth of it—on some reliable GOP earmark junkies: Mississippi’s Thad Cochran got $512 million; Utah’s Bob Bennett, $226 million; Maine’s Susan Collins, $114 million; Missouri’s Kit Bond, $102 million; Ohio’s George Voinovich, $98 million; and Alaska’s Lisa Murkowski, $80 million.

The effect of this dope—just sitting there, begging for a quick inhale—on earmarkers was immediate. Two seconds into the sweats and shaking hands, nine Republicans let Mr. Reid know they’d be open to this bill.

…Senate Republican leader Mitch McConnell accomplished a mini Christmas miracle. The Kentuckian devoted yesterday to making the arguments—both principled and political—to the Spending Nine. He was ultimately persuasive enough, and the earmarkers wise enough, to pull back their support. A very unhappy Mr. Reid was forced to yank the omnibus last night. He will now work with Republicans on a short-term funding bill, a process that should give the incoming GOP House far more influence over upcoming spending decisions. …

Michael Barone also comments on the good news from Washington.

…At the south end of the Capitol Speaker Nancy Pelosi was forced to watch gloomily as her Democrats failed to rally majorities to alter — and probably sidetrack — the deal reached between Barack Obama and Republican congressional leaders extending the Bush tax cuts for two years.

Instead, the House voted 277-148 for a measure that the Senate had passed 81-19 earlier in the week. “If someone had told me, the day after election day 2008, that the tax rates on income and capital would not increase for the next four years,” wrote Bush White House staffer Keith Hennessey in his blog, “I would have laughed.”

…Republicans, having succeeded in holding down tax rates, clearly have a mandate to hack away at spending and to defund and derail Obamacare, which is at or near new lows in the ABC/Washington Post and Rasmussen polls. And there does seem an opening, as Clinton White House staffer William Galston argues, for a 1986-style tax reform that eliminates tax preferences and cuts tax rates. …

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David Harsanyi says that there are no brains at “No Labels”.

“We are not labels — we are people.”

So begins the absurd, anti-democratic “declaration” of the soon-to-fail “No Labels” organization. This movement of rejected liberal Republicans and triangulating Democrats (oops, there I go again with the labels) are, unlike partisans and ideologues with bad manners, really interested in solving America’s problems.

“Not Left. Not Right. Forward!” is its motto.

The answer, my friends, is always in the muddled but inspirational middle. And partisanship “is paralyzing our ability to govern” — because, as you well know, Washington didn’t spend trillions and reform a significant sector of the economy in just these past two years. …

George Will also discusses the No Labels outfit.

…No Labels purports to represent a supposedly disaffected middle of the ideological spectrum. Some No Labels enthusiasts speak of eliminating “political retribution,” presumably meaning voters defeating candidates with whose positions they disagree. No Labels promises to police the political speech of the intemperate.

…The perpetrators of this mush purport to speak for people who want to instruct everyone else about how to speak about politics. Granted, there always are people who speak extravagantly, and modern technologies – television, the Internet – have multiplied their megaphones. But blowhards, although unattractive, are easy to avoid. …

…No Labels, its earnestness subverting its grammar, says: “We do not ask any political leader to ever give up their label – merely put it aside.” But adopting a political label should be an act of civic candor. When people label themselves conservatives or liberals we can reasonably surmise where they stand concerning important matters, such as Hudson’s ruling. The label “conservative” conveys much useful information about people who adopt it. So does the label “liberal,” which is why most liberals have abandoned it, preferring “progressive,” until they discredit it, too.

Tony Blankley thinks its time that politicians face fiscal reality before investors force the issue.

…Starting immediately, it is beyond the doubt of rational minds of the right, center or left – (yes, I concede to my fellow conservatives that I am stretching a point combining the words “rational” and “the left”) – that our national destiny requires us to re-establish fiscal balance or let our great history and remaining great destiny rot and fail.

As Alan Greenspan observed recently, we will surely reduce our debt and deficit – “the only question is whether we do it before or after a bond crisis.” And, as we have seen in Greece, Ireland and other parts of the world, a bond crisis doesn’t come slowly. It strikes within hours when the collective judgment of cold and calculating investor minds around the world reach a harsh judgment.

How ludicrous our petty haggling will look to us the morning after. And what a painful and long-lasting economic agony we and the world economy will have if that dreadful day comes.

But as Thomas Paine said and Reagan often repeated, “We have it in our power to begin the world over again.” And we do. Congress and the president could start now – before Christmas – to begin signaling to the world that Washington is committed to laying the legislative foundations in the next six months for fixing our fiscal crisis. It’s not even a world we have to begin again – just a vaunted American skill we have to reapply.

In Reason, Veronique de Rugy gives an overview of the muni bond bubble the administration increased, and explains how investors have recently signaled a lack of confidence in this market.

…Since 2000 the total outstanding state and municipal bond debt, adjusted for inflation, has soared from $1.5 trillion to $2.8 trillion … The recession didn’t slow the spending.

…Municipal bonds are perceived as safe investments because, like U.S. Treasury bonds, they are backed by the full faith, credit, and taxing powers of the issuing governments. Investors know that states and localities can always raid taxpayer wallets to pay off their debts. 

But in the last two years tax and fee hikes have faced greater public opposition. Last year, for example, Jefferson County, Alabama, was unable to raise sewer fees to meet its sewer bond obligation. Since governments are generally unwilling to cut spending either, the result of resistance to new revenue raising has been substantial increases in states’ and cities’ debt levels. Detroit and Los Angeles have announced that they may have to declare bankruptcy, as have a number of smaller cities. …

…But municipal bonds have not yet lost their low-risk reputation. According to the Investment Company Institute, $84 billion went into long-term municipal bond mutual funds in 2010, up from $69 billion in 2009. And the 2009 level represents a 785 percent increase from the 2008 level of $7.8 billion. Artificial incentives have lured investors into thinking that lending cash to bankrupted cities will be profitable. …

Fred Barnes discusses round one of Delta against the unions, and how the Obami are helping the unions in round two. Makes us want to hop on a Delta flight to show support.

…With the Obama administration on their side, the unions expected to win the elections and end Delta’s status as the only major airline with a largely nonunion workforce. (Delta pilots have been union members for years.) But the AFA and IAM lost in what was not only a shattering defeat for labor, but also a reflection of the sharply diminished appeal of unions for most workers today.

The final election, conducted last week, delivered the most stunning verdict. Delta workers at airports and reservation centers rejected the IAM, 70-30 percent. In November, flight attendants voted against unionization, 52-48 percent. Ramp (or “under the wing”) employees voted not to join the IAM, 53-47 percent. And maintenance workers turned down the IAM more decisively, 72-28 percent. Sensing defeat, labor unions had earlier decided not to attempt to unionize four other groups of employees: mechanics, technical writers, meteorologists, and “simulated technicians.”

It was a clean sweep for Delta and shocking to labor organizers. As a result, 17,000 former Northwest employees who had been union members will become nonunion once the election results have been certified. That may take a while because the unions have filed formal complaints that Delta interfered with the election. They are seeking a new election. Unions do this routinely when they lose an election. They are poor losers.

How did Delta thwart the unions? The company pointed out its pay and benefits are 10 percent to 15 percent above those of unionized employees who had worked for Northwest and have been for years. Higher pay, better benefits, no union dues—that was the argument. And it proved to be compelling. …

In the National Review, Rich Lowry succinctly explains everything wrong with ethanol and ethanol subsidies.

…Tom Harkin and Chuck Grassley, the Democratic and Republican senators from Iowa respectively, stand at the doors of Congress declaring: Ethanol now, ethanol forever. They have graced the Obama-McConnell tax bargain with an extension of a tax credit for ethanol that costs about $6 billion a year, and with an extension of a tariff on ethanol imports. Ethanol is so uneconomical that Congress supports it three different ways — with a mandate for its use, a tax credit to subsidize it, and a tariff to keep out competitors. Rarely are so many levers of government used to prop up one woeful product.

During the past decade, ethanol enjoyed a good run as a notional part of the solution to global warming. Then, environmentalists began to realize it may actually increase greenhouse emissions. Ethanol releases less carbon dioxide per gallon than gasoline. Once the emissions necessary to convert land to corn production and then grow and process it are taken into account, though, ethanol doesn’t look so green anymore.

So much corn — about 40 percent of the U.S. crop — is feeding into the maw of government-created demand for the fuel, that it could be increasing worldwide food prices. In short, in exchange for not reducing greenhouse emissions, ethanol reduces the availability of food to the poor.

The multiple layers of subsidization have their own perversity. Since there’s already a mandate to blend ethanol into gasoline, the tax credit is giving away money for something that would happen anyway. Environmental groups say this pads the bottom line of Big Oil. Harry de Gorter of the free-market Cato Institute has a more complicated take — the subsidy decreases the cost and therefore the price of gasoline, effectively subsidizing its consumption. Your Congress at work. …

In the Top of the Ticket Blog at LA Times, Andrew Malcolm has a post on Virginia’s AG and the win against the individual mandate.

Ken Cuccinelli has not been a well-known public figure — until now.

He’s the attorney general of Virginia, who wasn’t given much chance of succeeding in his lonely legal challenge to President Obama’s beloved healthcare legislation designed to change whatever you believe in on that subject.

But then, oops, Federal District Judge Henry Hudson on Monday agreed with the Virginia AG, declaring a crucial part of the law unconstitutional. Full details here, including the opinion’s complete text.

…Here’s how the judge put it in a powerful historical footnote: “Neither the Supreme Court nor any federal circuit court of appeals has extended Commerce Clause power to compel an individual to involuntarily enter the stream of commerce by purchasing a commodity in the private market.” …

CBS – Baltimore reports on a natural resources police officer that needs to get a clue.

BALTIMORE COUNTY, Md. (WJZ) – They fought to save a life, and now they say they’ll fight the fine. It all revolves around the rescue of a deer trapped in icy water Thursday night.

Alex DeMetrick reports that good deed was rewarded with tickets.

Strangers banded together to pull a deer out of the freezing water of the Patapsco River on Thursday night. “We seen the deer going under,” said Khalil Abusakran. “It couldn’t maintain.  It was starting to freeze, and it was really getting bad.” Abusakran brought a raft, and Jim Hart joined him. “We had oars and shovels to break the ice, for the deer to get out,” Abusakran said. But in the excited aftermath of the rescue, a natural resources police officer on the scene wrote both men a ticket.

“And he didn’t say anything,” Jim Hart said. “We went in and out of the water numerous times.  He didn’t stop us at all.” They say they were ticketed for not wearing life vests, although both are over the age for mandatory use of flotation devices. “No, we didn’t have vests on, but we’re not 16 years old,” Abusakran said. “There were personal floating devices on the boat.” The ticket itself doesn’t check off any specific violation, just a $90 fine. They’ll fight it in court, as they fought for the deer. The two men ticketed say they will fight the citations at the court hearing in Annapolis set for Feb. 18