Kausfiles: A mostly political weblog.



  • The Trouble With the Bailout Deal


    Time to call a meeting of UAW defenders to sort out kinks in the party line. The NYT, blaming Republicans for the bailout deal's Thursday collapse, writes:

    After Senate Republicans balked at supporting a $14 billion  auto rescue plan approved by the House on Wednesday, negotiators worked late into Thursday evening to broker a deal, but deadlocked over Republican demands for steep cuts in pay and benefits by the United Automobile Workers  union in 2009. ...

    The automakers would also have been required to cut wages and benefits to match the average hourly wage and benefits of Nissan, Toyota and Honda employees in the United States.

    It was over this proposal that the talks ultimately deadlocked with Republicans demanding that the automakers meet that goal by a certain date in 2009 and Democrats and the union urging a deadline in 2011 when the U.A.W. contract expires.  [E.A.]

    But wait a minute--didn't I read somewhere the claim that the UAW shouldn't be blamed because its labor costs were already competitive with Honda and Toyota? Yes, I did!

    The leaders of General Motors Corp. and the United Auto Workers union told Congress this week that a new union contract will virtually erase the labour cost gap between GM and foreign competitors with U.S. factories. [Nov. 19, 2008]

    If the gap had already been "virtually" erased, how could the cuts required to close whatever gap remained have been "steep"? ...  12:49 A.M.

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    Thursday, December 11, 2008

    Hierarchy Recalibration! Let the record show that Rod Blagojevich, sitting governor of Illinois, the fifth largest state in the union, was apparently willing to sell a U.S. Senate seat and his soul, and abandon his office, for a job paying less money ($250,000-$300,000) than is made by several hosts on National Public Radio. ... Randy Newman, call your office. ...  3:14 P.M.

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    Bam Sandwich? Yikes. 1) Rezko's talking; 2) The FBI's been asking about the house deal (an Election Day story I'd missed). ... 1:44 A.M.

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    The Trouble With the Bailout Deal: Here's the key passage from the briefing on the bailout "deal":

    Now, how does the process work? It was very important to us that there be--that this President's designee [the "auto czar"] have sticks, leverage, to make sure that all these stakeholders who are participating in the process of negotiations have a very strong incentive to make the deep and meaningful concessions that will be necessary for these companies to become viable over the long term. So there are a number of sticks. The first is, if these companies do not arrive in the negotiations at a plan that meets the test for long-term viability, that bridge financing shall be called by the President's designee. That means we get paid back at the end of the period.

    The period is until March 31st, or April 30th if the Presidenti's designee want to grant a one-time, 30-day extension because they're making progress and there's likelihood of success. So at the end of that period, if there's not a plan that makes these firms viable, the government gets its money back.

    Now, remember what I sad at the outset that this is a bridge to either fundamental restructuring or bankruptcy. They either have a long term plan that's viable, or we get our money back. And if we call our money back, which is required under this bill, then those firms are not going to be able to survive. That is a real incentive and a real stick for this President's designee to ensure that the stakeholders all across the board make the concessions that are necessary. [E.A.]

    OK. Might work! But some questions: 1) How is the government going to "get its money back" if the money has been spent and the firms are bankrupt? Only by liquidation, it would seem. So does the bailout deal eliminate the option of restructuring (as an ongoing enterprise) under the aegis of the bankruptcy court? Either the firms are saved under the "czar," or they are liquidated, apparently.  2) The big "stick" is to kill the firms, then. Isn't that too big a stick? Like a nuclear weapon is too big a stick? Come April 29th, if the choice is to approve a half-assed "restructuring" plan that has maybe a 35% chance of succeeding, or to kill General Motors, there's going to be an awful lot of pressure not to kill General Motors, no? The threat is so big it pressures the auto czar, not the executives, investors and union members. What's needed is an intermediate threat that's more credible. How about empowering the auto czar to declare the companies' labor contracts null and void? And to indefinitely delay payment of all executive salaries and bonuses? That would get the "stakeholders" attention, maybe. 3) Shouldn't there be a different "czar" for each firm? Having a single czar for the whole industry muffles what might be salutary competitive pressures. Maybe Chrysler's workers are so desperate they'll give up more in terms of pay and work rules than Ford's workers. Shouldn't that sort of choice be encouraged? Dueling "czars" would encourage this viability-enhancing reverse solidarity. ...

    Update: Walter Olson has a sharp, clarifying answer to all these questions. Sen. DeMint concurs. I tend to agree more with National Review's Jim Manzi's argument that "if we could stipulate that we could get all of the effects of an orderly bankruptcy through some government-sponsored process that just had a different name, then of course we should do it."  Even if the current deal is designed to protect existing "constituencies," as Olson claims, and eventual bankruptcy is in the cards, given the acute economic downturn there's virtue at this point in postponing the inevitable until a time when the nation can better absorb the blow.  But it would be better to have a solution now that actually saved Ford and GM and the jobs they create, instead of saving the UAW's work rules. ... 12:28 A.M.

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    Wednesday, December 10, 2008

    Name That Issue! Hmm. What issue would be at the top of the "legislative agenda" of Andy Stern's S.E.I.U. that Illinois Gov. Blagojevich generously offered to help pass after he was through appointing Obama confidante Valerie Jarrett to the U.S. Senate? If you said "card check"--the bill eliminating the secret ballot in union recognition elections--you win.

    Rumors that the name of the bill is going to be changed to the "Rod Blagojevich F----ing Valuable Choice Act" could not be confirmed as of press time. ...

    P.S.: Let's assume SEIU president Andy Stern did nothing wrong, and indeed maybe even blew the whistle on Blagojevich's offer of a "three-way" quid pro quid pro quo (after promising to "put that flag up and see where it goes"). Even so, if Stern was an authorized Obama "emissary" to the governor, in the attempt to get Jarrett a Senate seat, that should trouble opponents of "card check." Why? Because it means Obama wasn't worried about owing Stern a huge favor (if he'd succeeded in getting Jarrett the seat).  Would Obama do it if he was planning to disappoint Stern? ...

    True, "card check" isn't the only issue Stern cares about. Universal health insurance would probably be considered a sufficient repayment of the favor. But "card check" will come up much sooner. ...

    Update: According to several reports, the SEIU official who met with Blagojevich was not Stern, but Tom Balanoff, head of a powerful SEIU local in Chicago. The above analysis still applies--though, as Mary Katharine Ham notes, the question of whether the SEIU was indeed Jarrett's (and Obama's) authorized "emissary" or was freelancing seems fairly crucial. ... The NYT' s Steven Greenhouse implies it was Blagojevich who reached out to the union official, but a) I don't trust Greenhouse--in part because of bias** and in part because b) his story is foggy on the actual details. For example, Greenhouse mentions that a Blago aide "approached" the unnamed SEIU offical, but ignore's the indictment's claim of a later call between Blagojevich himself and the official. ... This seems like a pretty good case of Times readers not getting a clear picture of what went on. ...

    **--You can hear Greenhouse on "Talk of the Nation" where he sounds only a bit more pro-Obama than Austan Goolsbee.  ...11:30 P.M.

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    Caroline, No ...  12:17 P.M.

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    The Big Center (Part 2): The Nation's Katha Pollitt, voice of reason, on the Ayers op-ed:

    Like his memoir, Fugitive Days , "The Real Bill Ayers" is a sentimentalized, self-justifying whitewash of his role in the weirdo violent fringe of the 1960s-70s antiwar left.

    I'm actually not sure I agree with Pollitt when she argues that Weatherman-style violence was counterproductive when it came to stopping the Vietnam War. It seems to me that it contributed to the sense on the part of the "silent majority" that everything was spinning out of control and it was time to reverse course. That doesn't mean Ayers isn't a self-serving fool, or that planting bombs--in one case a nail bomb, as Pollitt points out--isn't terrorism, and crazy, and criminal. ... 11:49 A.M.

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  • McCain's Last Stunt?


    If (like me) you want to feel better about Barack Obama, try reading conservative Bradford Berenson's Frontline comments on Obama's performance at the Harvard Law Review. Excerpt: 

    I think Barack took 10 times as much grief from those on the left on the Review as from those of us on the right. And the reason was, I think there was an expectation among those editors on the left that he would affirmatively use the modest powers of his position to advance the cause, whatever that was. They thought, you know, finally there's an African American president of the Harvard Law Review; it's our turn, and he should aggressively use this position, and his authority and his bully pulpit to advance the political or philosophical causes that we all believe in.

    And Barack was reluctant to do that. It's not that he was out of sympathy with their views, but his first and foremost goal, it always seemed to me, was to put out a first-rate publication. ... [snip]

    It confirmed the hope that I and others had had at the time of the election that he would basically be an honest broker, that he would not let ideology or politics blind him to the enduring institutional interests of the Review. It told me that he valued the success of his own presidency of the Review above scoring political points of currying favor with his political supporters.

    12:23 A.M.

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    Friday, October 17, 2008 

    The Last Stunt is Always to Drop All the Stunts: Hmm. If, as Mike Murphy argues, 1) McCain's negative campaigning hurt him, and 2) his brief moments of non-negativity before the debate were helping him--something Gallup seems to support--but if 3) his renewed and MSM-amplified negativity during the debate turns out to have hurt him again, is there time left before the election for McCain to flip back again and 4) dramatically drop the attacks and make a direct, affirmative case for his presidency? The Feiler Faster Thesis says "yes," as it usually does. There are two whole weeks to go! ... But what does McCain do with the second week?  ... P.S.: Republican incumbent Norm Coleman pulled this very stunt in Minnesota. Is it working for him? Quinnipiac has him only 2 points down. ... 4:15 A.M.

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    Mark Krikorian, who knows as much about immigration politics as anyone, sticks by his conclusion that McCain, not Obama, would be "more likely to get an amnesty through Congress." His reasoning is similar to that of Democratic Rep. Artur Davis: Without a Republican in the White House actively promoting legalization, Republicans in Congress will be free to coalesce in opposition to any Obama legalization push. ... You also have to wonder: If even John McCain's lifelong (and only temporarily suspended) campaign for legalization doesn't get him much support among Hispanics--who currently seem to prefer Obama 2-to-1--will Republicans in general finally give up on the cynical Rovian dream of using immigration liberalization to win over that growing ethnic group? ... 3:23 A.M.

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    Thursday, October 16, 2008 

    I forgot to ask Bob Wright if he'd serve on a board with William Ayers. ... I think I know what his answer would be regarding Luis Posada and Eduardo Arocena.. ...P.S.: Wright calls Sarah Palin's "palling around with terrorists" charge against Obama

    one of the most despicable acts in the history of American campaign politics.

    and even issues a challenge to come up with something more despicable. ... Bloggingheads commenters rise to the occasion. ... Update: Maguire offers some useful sober skepticism on Obama's "palling" defense. ... 11:52 P.M.

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    USA Today editorializes against "card check."  The more attention this issue gets, the less chance it has of passing, you'd think. It's hard to publicly defend getting rid of the secret ballot. ... I'd like to see Obama try it. (Since he's for "card check," shouldn't he be asked to explain his position?) ... P.S.: No wonder Democrats  would want to rush "card check" through, in the early days of his presidency, before too many people notice--and when press reports are likely to be buried under a crush of other news. ... 5:10 P.M.

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    Wednesday, October 15, 2008 

    Final Debate:  Before I get spun: 1) McCain did himself some good in this zero-sum game because in the first half of the debate he seemed sunny, yet had Obama on the defensive; 2) But not enough good; 3) Specifically, McCain failed to drive home the risk of placing so much power and trust in a relative unknown. Why couldn't he say, "I know I'm behind by a few points. But do you really know what you're getting with Sen. Obama?" Everything else in this campaign has been so crudely explicit--with talk by Obama of a "pivot" and appeals, not to "the people" but to "Joe Sixpack" and "the middle class." You'd think McCain could just come out and say, "Message: Buyer's Remorse!" ... 4) Obama's answer on the have-you-ever-bucked-your-party question was strong.  His answer on Ayers was weak, all the weaker because he seemed to think it was strong;  ... 5) "Senator Government." McCain's best line was an accidental slip. 6) Also liked "Bresh of Freath Air." So true!  ... 6) Bob Schieffer made McCain look young and vigorous. 7). But you had to love the way that sly old Schieffer snuck in a few unexpected questions to throw the candidates off and reveal their true characters! ... Oh wait, He didn't do any of that!  Instead he made utterly predictable stabs at vague, CW-approved topics, as if he was trying to out-bore Brokaw. He succeeded. ... He made Jim Lehrer look like Jim Cramer! ... Is this the end of the MSM Dinosaur Moderator? ...Next time: Chris Buckley and Glenn Loury! ... 8) Most telling passage:. Two times, if I remember right, McCain rattled off long lists of occasions when he had gone against his party, and each time he left off "immigration," his most salient anti-GOP heresy. (He brifely mentioned it later in a more anodyne context.) Once Obama had an opening to back up his charge that McCain was an unreliable champion of "comprehensive immigration reform." He didn't take it. This suggests that both candidates recognize that pushing "comprehensive immigration reform"--i.e. legaliztion--is a loser with the general electorate. Or it's at least very risky. Both would confine it to targeted appeals to Latinos on Spanish language radio and TV, which most voters never hear about. No Hispandering in public! .... Don't you agree, Tamar? .. 9) A crude translation of McCain's initial salvo on the economy: The problem is that Fannie Mae and Freddy Mac tried, by buying up mortgages, to encourage home ownership in the face of economic reality. So we need a new Fannie Mae to buy up mortgages and encourage home ownership in the face of economic reality! ...10) McCain constantly calls for "transparency." Is that a word voters understand, or is it Beltway code? ... 11) Obama's praise of the new DC school chancellor  is certainly a coded appeal--an appeal to people like me. Chancellor Rhee is not a teachers' union favorite. ... 12) How many parents of autistic kids could there be? ... 13) If polling produces a "Bradley Effect," in which ordinary citizens will say whatever they think is PC in front of a lone pollster, won't CNN-style "dial groups," in which voters record their reactions in front of a massive TV audience, produce a Super-Bradley Effect? ... 14) McCain on his health plan:

    Now, 95 percent of the people in America will receive more money under my plan because they will receive not only their present benefits, which may be taxed, which will be taxed, but then you add $5,000 onto it, except for those people who have the gold-plated Cadillac insurance policies that have to do with cosmetic surgery and transplants and all of those kinds of things

    So in John McCain's America you don't get life-saving transplants? Sounds more like Great Britain. ... One reason I tend to favor government-provided health insurance is that I know that in the U.S. the political pressure will always be to pay for expensive, complicated medical treatements, and I don't mind if 40% of our GDP goes to complicated medical treatments. ... 15) Obama used the word "invest"--as in "invest in the American people"--quite a bit. This is a liberal cliche that sets my teeth on edge, but I don't know if that's true of swing voters. On the other hand, "spread the wealth around" could have widespread appeal! (McCain thought it obviously could mean only static, pie-slicing redistribution, but as a slogan it might also mean something like "more generalized growth," no? Update: In fact, that seems to have been the way Obama used the phrase. He said, "My attitude is that if the economy's good for folks from the bottom up, it's gonna be good for everybody. I think when you spread the wealth around, it's good for everybody.") ... 6:50 P.M./updated 9:15 P.M.

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    Obama's Fast Labor Payoff: kf hears from a trustworthy non-Republican source (with access to actual insider information) that the Dems are getting set to pass "card check" legislation fast next year, right out of the box, assuming Obama wins and the Democrats get their expected big Senate majority. The legislation--which would eliminate the secret ballot in union organizing elections, allowing union organizers to gather signed cards person-to-person--is cheap, in budgetary terms. And it's very, very important to organized labor. ...Obama's political history suggests he's not a "fight the power" kind of guy. He's an "accommodate the power" kind of guy. It's highly plausible that he'd be willing to pay off this debt to Big Labor up front if they push him hard enough. ... Since I think "card check" legislation is a potential near-disaster economically (unions are engines of adversarial bureaucracy and the mainspring of the wage-price spiral) and procedurally (the secret ballot certainly seems like a key way to avoid intimidation) this is not good news. ... P.S.: Would it be a good move for Obama? Bill Clinton got into trouble, right after he took office, when in the middle of a troubled economic situation his first priority seemed to be gays-in-the-military. Obama likewise risks having it look like his first priority isn't helping the average citizen but helping a key Democratic interest group. ... In Clinton's case,, that damaging first impression was maybe unfair (the gays issue just happened fo flare up). In Obama's case it won't be. ...[Thought you were pro-Obama--ed Yes. But I am, as they say, concerned!  Not scheduled to enter full pro-Obama BS mode for at least two more weeks.] ... 4:58 P.M.

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    Now it can be told: Former LAT employee Tim Cavanaugh on the paper's Edwards coverage:

    The L.A. Times desperately wanted to avoid this damaging story, dressed up its desires in media-diligence drag (we were told not to comment until the paper's reporters were through looking into the matter), and as a result was beaten and humiliated in its own backyard.

    They even somehow got blogger Andrew Malcolm to claim he was happy to be gagged. ... .12:34 A.M.

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    Tuesday, October 14, 2008 

    Next stunt, please (cont.)!  Another obvious possible McCain stunt: Go back on Letterman. Apologize. Self-deprecate. Hug. Big ratings. .. .10:52  P.M.

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    It's hard to stop a gravy train:

    Fannie Mae and Freddie Mac, the troubled mortgage giants that were recently taken over by the government, are expected to continue donating to charity, the Federal Housing Finance Agency has assured nonprofit groups in the Washington metropolitan area.

    Matt Cooper and Michael Kinsley have failed. ... [via NewsAlert ] 8:29 P.M.

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    Immigration causes global warming! ... Well, in that case ....7:21 P.M.

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    The rich and powerful Getty Museum's idea of "the political fray": a debate between theatrical left-wing artist Robbie Conal and theatrical left-wing columnist Dan Savage! ... And they say the art community is a bunch of theatrical left-wingers talking to each other. ... Take it away, Andrew Breitbart. ...P.S.: Well, they could always discuss Savage's muscular foreign policy vision! ... 7:21 P.M.

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    The Surprise October Surprise: The "October Surprise" that might help McCain wouldn't be a new bin Laden tape, or an Al Qaeda attack, but rather a medium-sized setback in Iraq, no? One of McCain's problems is that voters aren't paying much attention to Iraq--because it looks from our distant vantage point like the war is finally on a glide path to an honorable U.S. drawdown of troops. How much damage could Obama do?  But if suddenly the near-term outcome in Iraq seems to be in doubt, voters could decide that McCain has shown better judgment on recent strategy in the war. ... Of course, if the U.S. Iraq project suffers a huge setback, McCain's support for the "surge" would look distinctly less prescient. Hence, "medium-sized." ... 3:05 A.M.

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