Archive for the ‘ David Lamb ’ Category

$152 billion is the total tally in government loans that insurance giant American International Group (AIG) accumulated over the past eight months and 90% the tax that a congressional bill proposes levying on bonuses for employees whose companies received more than $5 billion in federal bailout money.

328-93 was the final vote on that measure in the House of Representatives last Monday, and December 10th was the date that the bill’s catalyst—the story about continued AIG bonuses—broke. Fifteen is the number of weeks that President Obama allowed populist anger at Wall St. spending to mature before he forced Congress into action, and 15% is the amount his national approval rating dropped over that period.

Rick Wagoner is the name of the former General Motors (GM) CEO who was asked to resign by Mr Obama’s automobile task-force during a meeting last Friday—the same day that Mr Obama met with chief-executives from Bank of America, Wells Fargo, and Morgan Stanley, criticizing them for failing to grasp the financial crisis’ magnitude. That day, March 28th—when Mr Obama decidedly took the reins of Detroit and downtown Manhattan—will mark the president’s shift in policy toward bailed-out American companies from financially interventionist to outwardly managerial.

Click to continue reading “The Perils of Populist Anger: From Rick Wagoner to AIG”

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“I do solemnly swear that I will faithfully execute the office of President of the United States…” were the words that President Obama planned to say on January 20th before Chief Justice John Roberts botched the presidential oath of office and Mr. Obama repeated his mistake.  Assuming no darker motives—that Mr. Roberts was not deliberately creating a validation for a future ruling that Mr. Obama is not America’s president—his public snafu with Mr. Obama might at least foreshadow a period of little cooperation, perhaps even blatant counteraction, between an economically interventionist Mr. Obama and a still strict-constructionist Supreme Court.

1978, the last time America saw a Democratic majority in Congress as great as it is now—nearly 60%—coincided with the first term of President Carter—also a Democrat.  The 96th Congress that convened until 1980 was marked by broad productivity, passing more laws than the two Congress’ that preceded it.  If the high output of bills was due to Democratic control of the legislature and the White House, then the current—111th—Congress ought to be the most productive in a long time.  Nonetheless, the current federal judiciary remains much more conservative than that of 1978, suggesting that any productive period in Congress will likely be met with constitutionality rulings in the Supreme Court.

Click to continue reading “U.S. v. Barack Obama: The slippery slopes of the Constitution”

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Fewer than three years ago the American real estate market was at an all time high; the median home cost—$245,000—had not fallen in nominal or real dollars since 1991 and low average mortgage rates—around 6%—meant homeownership was possible for many first-time buyers whose comparatively low salaries made longer term mortgages necessary.

For the 70% of Americans who owned a home, increasing home values meant increased wealth—theoretically at least—and yet the average home equity of 46% meant Americans were actually owning a smaller percentage of their houses than ever.  Moreover, the median income of $44,000 meant Americans were also earning less, in comparison to the price of a home, than ever; for those who hadn’t yet achieved it, the American dream was on life support.

Click to continue reading “How Foreclosure is Bringing Back the American Dream”

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In 1919, John Maynard Keynes hypothesized that the free-market economy was fundamentally unstable—that rises in unemployment and drops in aggregate demand would not tend to self correct, but rather to self-magnify.  In 1936, in The General Theory of Employment, Interest, and Money, Mr. Keynes outlined how a government’s central bank could stabilize the economy, thereby avoiding the damaging boom-bust cycles of the late 19th and early 20th centuries.

Sixty-six years later American economist and Nobel-laureate, Joseph Stiglitz, attacked then chief-economist at the International Monetary Fund (IMF), Kenneth Rogoff, for participating in the economics of President Hoover—insisting that developing countries maintain balanced budgets, and therefore high overnight interest rates, in the face of recession.  Mr. Rogoff argued that while lowering national interest rates in emerging economies during economic depressions would stimulate demand, it would also drive deficit spending, which could easily cause investors to lose confidence in the immature currencies leading to unabated inflation.  Mr. Stiglitz, like Mr. Keynes before him, maintained that counter-cyclical monetary policies—namely lowering interest rates during periods of recession and raising them during periods growth—were necessary to protect economies from the downward spiral of depression.

Click to continue reading “Mr. Keynes Finds a New Home: The exportation of American economic policy”

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In 2000, then Vice-President Gore defeated then Texas Governor and Republican Presidential nominee George Bush in Maine, 49% to 44%.  But unlike in Iowa and Minnesota where Mr. Gore won by slimmer margins and still captured each of the states’ electoral votes, in Maine he was awarded the support of only six of ten electors.

Having electoral votes awarded to the winner of the statewide popular vote and individually by district—as they are in Maine and Nebraska—started in Maine in 1972 after reformers argued that the winner-take-all system did not accurately represent the choices of voters.  In 1992, Nebraska passed its own amendment to the state constitution and followed suit, though Nebraska’s five electoral votes would never be split until President-elect Obama captured one in 2008.

Click to continue reading “Is the Electoral College Obsolete?”

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