The Prisoner's Dilemma

There is a very famous game theory problem, called the Prisoner's Dilemma, that has specific application to international negotiations. Here are the basics:

Two suspects are arrested by the police. The police have insufficient evidence for a conviction, and, having separated both prisoners, visit each of them to offer the same deal. If one testifies (defects from the other) for the prosecution against the other and the other remains silent (cooperates with the other), the betrayer goes free and the silent accomplice receives the full 10-year sentence. If both remain silent, both prisoners are sentenced to only six months in jail for a minor charge. If each betrays the other, each receives a five-year sentence. Each prisoner must choose to betray the other or to remain silent. Each one is assured that the other would not know about the betrayal before the end of the investigation. How should the prisoners act?

Obama's recent foreign policy decisions remind me of the Dilemma. There is one chilling difference though. Obama has chosen to cooperate with the other side (youtube video to Iran, reduced missile defense in Alaska and Europe, pathetic response to North Korea) and has actually made his choice known to the other side before they have to make their own decisions.

The potential benefit is that any country who might want to cooperate can do so without fear of being exploited.

However, does anyone think Iran, North Korea, China or Russia has much interest in acting cooperatively? Of course not. And so the problem is that these countries, and others, know they can exploit Obama's cooperative actions without danger to themselves. In fact, they have no incentive not to exploit Obama. As Charles Krauthammer notes, Obama is attempting to the world lead by example. But is anyone else really going to follow? Maybe Biden meant he was talking about Obama with his "no one's following" bit.

Catholic Support Slipping?

Amy Sullivan of Time Magazine reports that Obama is already losing support from Catholic voters.

I said during the campaign that Catholics were fooling themselves if they believed Obama was the "real" pro-life candidate. And now they are realizing the truth.

It's a bit of buyers' remorse now. The question, of course, is the impact. Will Obama lose a huge voting bloc when it comes time for reelection (assuming the country survives that long)? Or will this all be forgotten by then? My guess is that if he continues along these lines, more Catholics will feel the same way as those at Notre Dame, who protested the President's visit.

New Global Warming Study

Hot Air reports on a new study from NASA that suggests global warming is indeed man-made, though not in the way liberals claim.

Apparently, reduction of aerosol and sulphur emissions starting in the 70's led to a reduction of particulate matter in the atmosphere that actually caused a cooling effect. Reducing emissions led to a reduction in cooling materials and a rise in the temperature, which caused higher-than-usual melting of the arctic shelf.

Talk about the law of unintended consequences.

Or, were they actually intended? Remember, back in the 70's, liberals were warning us about going into another ice age. Looks like they managed to prevent that from happening (ha ha) and got us warmed up pretty well.

Here's a Great Read

Great Article by Bartle Bull of Prospect Magazine

It's nice to get perspectives from people outside of the country.

The Liberal Thought Process

So, I was reading an article on the Huffington Post by Robert L. Borosage and several things jumped out at me about the way liberals think - especially about the upcoming budget.

"Fully $1.4 trillion of the largest annual "Obama" deficit -- the $1.8 billion the CBO projects for FY 2009 that ends this October -- was bequeathed to him from George Bush"

The idea is that because Obama inherited a deficit from Bush, it is OK to continue on in the deficit spending.
This is problematic for two reasons: The first is easy (and we all learned it as children) - two wrongs don't make a right. Second, Obama has significantly added onto Bush's deficit with his $787 billion "stimulus" bill, his $400 billion spending bill, Geithner's $1 trillion Public-Private Toxic Asset idea, and other spending. He didn't inherit any of that spending from Bush.

"Now as the economy verges on a depression, Republicans are indicting Obama for raising spending and deficits. This is like a gambling addict squandering the family fortune in a Las Vegas blowout and then scolding his wife for borrowing money to keep the kids in college."

Um yeah. Obama was elected to fix the problem, not make it worse. During his campaign, he claimed to have solutions. So, if he does nothing to solve the problem, yeah, he should be held accountable. He claimed that the "buck stops with him" and it rightly should. If he didn't think he could solve the mess, he should have dropped out of the race.

"Had Republican leaders any sense of decency, they would just shut up and let adults address the mess they have left."

I think it says something if you always have to resort to name calling and insults.

"The current US public debt is about 40% of our annual economic production (GDP). It's been far higher -- reaching as much as 109% of GDP coming out of World War II."

He probably doesn't realize that the debt incurred during WWII was in fighting Nazis and the Japanese (not increasing domestic entitlements). Agreed that it is necessary to spend what you have to spend to get out of a crisis and the current financial situation qualifies. But how much of Obama's $9.7 trillion debt burden is related to getting out of the financial crisis? Not most of it.

"Clinton brought it down to 33% and Bush drove it back up to about 40% even though the economy was growing. Under Obama's plans, the national debt will rise as a percentage of the economy to about 65-67%."

This one makes me laugh. He criticizes Bush for increasing the debt 7% even though the economy was growing. But then he gives Obama a pass for increasing it 25%. And guess what buddy - the projections are that the economy will be growing again in 2010. So, if Bush raises it 7% during a time when the economy is growing, it is bad. If Obama raises it 25% while the economy is growing, it is good. Be honest and just say that what Obama is doing is OK because it is spending on things you approve of (entitlements as opposed to national security).

"But what is notable about that increase is that it will leave the US carrying only about the same debt burden that Germany, France and Canada were carrying -before they began adding to it in the current economic downturn. According the analysis of the Central Intelligence Agency in 2008, Germany's public debt was at 65%, France at 66%, and Canada at 64%."

Ah, the good old "If it's good enough for France..." defense. France does a lot of things that I wouldn't want to happen in the USA. But then again, that's pretty much the difference between liberals and conservatives, right?


One more laugher:

"Richard Shelby, top Republican on the banking committee, warns Cassandra-like that Obama's budget will put the country on "the fast road to financial destruction.""

Should someone tell him that Cassandra correctly warned about the destruction of Troy? She was given the gift of prophesy but cursed so that no one would believe her.

Liberal Offensive Against Palin

It sounds like liberals are attempting to ground Sarah Palin's run for President in 2012 before it can even start.

Her opponents in Alaska have subjected her to a deluge of ethics complaints, which have cost her $500,000 in legal fees.

There is no question that liberals are threatened by Palin and everything that she stands for. But I had thought that they would leave her alone once the election was over - at least until she announced another run.

But they are doing two things here: first - exhausting her personal resources to make it harder for her to run for President. Second, making sure to muddy her name as much as possible, so that in 2012, they can claim that she had X number of ethics complaints filed against her as governor.

It's despicable and also a bit frightening. The liberal government has shown what it can do to people it doesn't like (AIG bonus tax, anyone?) and this will probably be a story that is repeated with more frequency for the next four years.

Putting Obama's Budget in Perspective

Great article from Peter Ferrera about Obama's budget.

It's completely shocking that Obama could try to convince anyone that he is going to cut the budget or is making "difficult choices".

I really can't wait to see Paul Ryan's budget next week.

We've Always Been at War with Eastasia

Is it just me, or do you get a Nineteen Eighty-Four vibe from the Obama Administration lately?

We no longer have the War on Terror - it is now "Overseas Contingency Operations"

Acts of terrorism are now called "man-created disasters"

We can no longer use the words "terrorist" or "enemy combatant"

Andrew Breitbart (his blog here) made a great point on Sean Hannity tonight. Look at how Democrats treat political enemies compared to how they treat America's enemies. Barney Frank calls Supreme Court Justice Antonin Scalia a "homophobe" but we can't call someone who blows up buildings containing women and children a "terrorist"?

You look at the massive smear campaign against Rush Limbaugh and all Republicans, orchestrated by James Carville and approved by the White House and you have to think a bit about "Hate Week" from Orwell's novel - a time in which citizens are stirred up against the enemies of "The Party".

And does anyone get a "cult of personality" feel from Obama - especially when he chooses to bypass a skeptical Washington Press Corp and take his message directly to media outlets that are much more friendly?

Or am I just paranoid?

Interesting Lines from Obama's Press Conference

What I've said here in Washington is that we've got to make some tough choices. We've got to make some tough budgetary choices.

Tough budgetary choices? Since Obama seems unwilling to cut anything out of his agenda, I wonder what he is referring to. He went sky-high on his budget, including record deficits and tripling the current national debt within 10 years. So, where are the tough choices?

And I've said that we've got to start driving our deficit numbers down.

Um, how do you plan to do that when your own projections are for 7 trillion in deficits in the next 10 years? That is not driving the deficit down. And let me tell you, raising taxes into the stratosphere won't get you there either.

Now, we never expected, when we printed out our budget, that they would simply Xerox it and vote on it. We assume that it has to go through the legislative process.

This statement seems to be contradicted by the fact that he is trying to get the budget passed by the House on a single vote, without any changes.

First of all, I suspect that some of those Republican critics have a short memory, because, as I recall, I'm inheriting a $1.3 trillion deficit, annual deficit, from them. That would be point number one.

First, here's the same finger pointing and petty politics that Obama said he was going to Washington to change. Second, it is a bit dishonest to say he was inheriting a $1.3 trillion annual budget deficit. That number was the deficit for last year, which was a year of bailouts. The deficit for the previous year was around $500 billion - not great, but much lower than what Obama is going to institute. To claim a $1 trillion annual deficit per year for 10 years is reducing the deficit is so intellectually dishonest that it is embarrassing.

Both under our estimates and under the CBO estimates, both -- the most conservative estimates out there, we drive down the deficit over the first five years of our budget. The deficit is cut in half.

Again, very misleading. A deficit of $700 billion per year is still higher than anything George W Bush had in all but his last year in office. And there are no projected bailouts in that budget, which means it is nothing more than a growth in government spending. It is an increase in the deficit, not a reduction!

But it is going to be an impossible task for us to balance our budget if we're not taking on rising health care costs

Obviously, most everyone agrees for a need to reduce health care costs. But you are not going to balance the budget by instituting universal health care, which is what Obama is calling for. Revamp the health care system, yes. Government run (and funded) health care, no.

What we said was that, over the last decade, the average worker, the average family have seen their wages and incomes flat. Even in times where supposedly we were in the middle of an economic boom, as a practical matter, their incomes didn't go up.

That's actually not true. When you include benefits like health insurance payments, retirement payments and other benefits to employees (and not just straight salary), the pay for the average worker has gone up dramatically in the past 30 years.

Question: But on AIG, why did you wait -- why did you wait days to come out and express that outrage? It seems like the action is coming out of New York and the attorney general's office. It took you days to come public with Secretary Geithner and say, "Look, we're outraged." Why did it take so long?

Obama: It took us a couple of days because I like to know what I'm talking about before I speak.

Sigh

The Obama Snooze-Fest

Well, that was boring.

It is pretty obvious that Obama over-corrected after he has been hammered for joking and laughing about the economy and turning his attention to other things (March Madness). But I would much rather see him making fun of the handicapped than sit through such a dull and monotonous presentation.

I have to admit that I didn't watch the whole thing. I just couldn't do it. It was so boring! And repetitive. He said the same thing over and over. Most of it was stuff he said during the campaign.

And what was the deal with the opening statement. You think that if you remove the teleprompters and replace them with a giant TV in the back of the room, no one will notice that you are still reading? Come on!

So, I basically got nothing out of it. And I doubt Obama came any closer to drumming up support for his bank-breaking budget plan.

Card-Check Dead for Now?

According to the Washington Examiner, Senator Arlen Specter will oppose cloture on card-check in the Senate today. This means that the Senate will be unable to pass the bill and that it is, at least for now, dead.

That is great news in the fight against union intimidation. However, it is likely that the issue is not over. This means that we must continue to encourage our representative to oppose this bill.

Initial Reaction to the New Giethner Plan

The New York Times and The New Republic don't seem too impressed.

However, as predicted, the stock market is reacting favorably - the Dow is up about 4% at this point. In addition, Asia markets are doing very well today based on this news.

Of course, if the plan fails to take root, these early gains are meaningless. But it is further proof of what I posted last week - investors are there and money is there. People just want to know there is a potential for things to get better.

Obama Reaches out to Former President of France

President Obama wrote a letter to Jaques Chirac, the former President of France, saying he hoped the two could work together for the next four years (at least he accepts he will be a one-term President). I speak very little French, but it sounds like Obama discussed their mutual opposition to the war in Iraq.

I wonder two things:

First, does Obama think he is going to improve our standing in the world by dealing not with current leaders of other countries, but with their predecessors? How is the going to help build a coalition to help deal with problems like Iran?

Second, how would Obama feel if current French President Nicolas Sarkozy attempted to continue working with President Bush, instead of Obama? Sarkozy was a big supporter of W.

Finally, it seems that this contradicts his earlier statement of "one president at a time" dealing with foreign affairs. However, it could also mean that he really wants to deal with only one French president, and it's not the current one. It's going to be tough to get France's help on any issue when discussing the matter with someone out of power.

Obama's Inappropriate "Gallows Humor"

President Obama did an interview with 60 minutes tonight. At one point, interviewer Steve Kroft incredulously asked Obama how he could laugh about the financial crisis, and asking him, "Are you punch-drunk?"

It's another misstep in a series of them for Obama. His obvious false "rage" about the AIG bonuses, his public undressing by Duke's Coach K, his Special Olympics gaffe... it hasn't been a good two weeks (two months) for the President.

Fred Barnes sums it all up nicely.

Geithner (Finally) Unveils Toxic Asset Plan

It's not a perfect plan, but at least it's something.

Treasury Secretary Tim Geithner finally announced his plan to remove toxic assets from the ledgers of banks and financial institutions.

The basis of the plan is to create a "Public-Private Investment Program"; the public being $500 billion to $1 trillion more of federal money, the private being investments by the private sector into the fund. The plan is that investors can set the proper valuation of the troubled assets and share in the risk.

It seems like a relatively simple plan, which makes one wonder why it took Geithner so long to come up with it.

The problem with the plan is that private investors could have been buying these troubled assets all along - why will they start to do it now? Theoretically, investors will buy in because they are only taking half the risk - with the government (taxpayers) taking the rest. But if the private investors stay away, the taxpayers will be left holding the entire bag of [expletive deleted] and it will probably require more than the trillion dollars of federal funding that Geithner has offered up initially.

The first question will be to see how people respond in the morning. My guess is that people will be happy to have some sort of plan, and that alone might help ease financial tensions.