Archive for March, 2009
March 31st, 2009 by Jon Taplin
Washington and the Cable Punditocracy are so out of touch. Their narrative is “Obama in trouble”, but look at the latest Washington Post Poll numbers!
Barack Obama is in the flow, like Julius Irving driving against Kareem Abdul-Jabbar in the 5th game of the 1980 NBA Finals. As my new favorite writer in the world Dave Hickey ( Air Guitar: Essays on Art & Democracy
) said about that moment.
Just the celestial athleticism of it is stunning, but the tenacity and purposefulness of it, the fluid stream of instantaneous micro-decisions that go into Erving’s completing…Well it just breaks your heart.
Obama has a world-class “tenacity and purposefulness”. But American Progressives have a weird self destructive tendency, exhibited in the last three months, to misunderstand the enormity of the revolution we are entering in to. So their general paranoia directed towards any lifer bureaucrat like Tim Geithner–who is truly just trying to make the best use of the system that exists–is that they are assumed to be agents for the worst hedge fund short seller.
Guys like Krugman think it’s going to be easy for the government to manage banks and auto companies.
Bullshit.
The reform of American Democracy has already begun. Read the damn stimulus bill. I don’t know it all, but I know some of the stuff about Broadband, and it’s going to be major. We can stop being a second class Internet system operator.
For those of you who are new to my work, I have tried to express my view of what is happening in two papers: America 3.0 & The Interregnum and The Cost of Empire. And if you want to delve deeper, the site search engine is pretty good.
I believe America 3.0 would look very different from the America we are living in now.I believe we are actually on a path to these goals and so I think the direction of optimism (up) seen in the WashPo sample is both real and improving. Given the drumbeat of the media “if it bleeds, it leads” approach to the economy story–like some sick rerun of ” Queen for a Day”–it’s astonishing Obama’s numbers are so high.
To me it says that for the time being Mitch McConnell, John Boehner and Eric Cantor have made them selves irrelevant by their truculence. The public understands this.
But finally,If you think I’m wrong, i’m always open to different visions of our near future and I always appreciate smart criticism.
March 31st, 2009 by Jon Taplin
A one day summit of the 20 nations that make up 80% of the world’s economy is really nothing more than a posturing exercise for roosters like Sarkozy of France and Hu Jintao of China to show their home market that they can stand up to the U.S.. Last week the Chinese suggested that the dollar be replaced with a new “world reserve currency”. Good luck with that.
The dollar is the world’s reserve currency because it is the largest and most liquid government bond market. Our T-bill market alone is (ex-Japan) bigger by a factor of two-to-one than the next five government debt markets. China may not like owning so much US paper, but the market for US treasuries is three times the size of the Euro zone debt market, and China has no other choice.
Despite all the doomsayers, I am of the opinion that the worst of the economic crisis in the U.S. has passed. That is not to say that unemployment won’t continue to worsen for the next six months, but the notion that we are headed into a second great depression is way oversold. If you want to see what a depression looks like, check out these charts from yesterday’s Wall Street Journal.
So President Obama’s task for the next few days will be that of the Zen Master. Let Merkel, Sarkozy and Hu posture for their domestic audiences, do some serious listening and avoid the temptation to instruct them how to fix their own domestic economies.
March 29th, 2009 by Jon Taplin
Communications academics use the word “mediated” a lot– “connected indirectly through another person or thing”. The “thing” of course is a screen–TV, Computer, mobile phone–and a new survey says the average American stares at the damn things 8.5 hours a day. All of which delights advertisers.
The researchers found that the number of minutes with media is almost identical for every age group. Mr. Wakshlag called the amount of time “amazingly consistent across the age groups.” Except, that is, for 45-to-54-year-olds, who spend on average an extra hour in front of screens each day, the study found.
I don’t know about you, but I like to sleep 8 hours a night, swim for an hour a day and my commute to USC is 45 minutes each way. That leaves about 4 hours of human (unmediated) interaction a day.
I’m exhausted just thinking about it.
March 28th, 2009 by Jon Taplin
Talk about the “Long Tail”. Look at how Facebook’s age distribution has changed since it’s founding. Also its geographic distribution.
By any measure, Facebook’s growth is a great accomplishment. The crew of Mark Zuckerberg, the company’s 24-year-old co-founder and chief executive, is signing up nearly a million new members a day, and now more than 70 percent of the service’s members live overseas, in countries like Italy, the Czech Republic and Indonesia. Facebook’s ranks in those countries swelled last year after the company offered its site in their languages.
Last year my graduate students did a project to find out which American sports and entertainment stars had the best reputations in 14 Muslim countries. The way they sourced the information and follow up interviews was through the Facebook networks in each country. If they would now just ask their users if they would be willing to watch relevant advertising based on their user profile (opt in) they could contruct the first really good online ad business.
As someone once said. “There’s a pony in there somewhere.”
BTW-Brad Pitt and Angelina Jolie, won hands down. Most people cited their work after the earthquake in Pakistan.
March 28th, 2009 by Jon Taplin
Our two labs never get this far in their dreams.
[youtube=http://www.youtube.com/watch?v=z2BgjH_CtIA&eurl]
March 27th, 2009 by Jon Taplin
Kurt Andersen (Heyday
) has a wonderful long essay in the new issue of Time Magazine. It certainly maps to a lot we have been discussing here for the last year. Here is a sample of it.
The ’80s spirit endured through the ’90s and the 2000s, all the way until the fall of 2008, like an awesome winning streak in Vegas that went on and on and on. American-style capitalism triumphed, and thanks to FedEx and the Web, delayed gratification itself came to seem quaint and unnecessary. So what if every year since the turn of the century the U.S. economy grew more slowly than the global economy? Stuff at Wal-Mart and Costco and money itself stayed supercheap! Even 9/11, which supposedly “changed everything,” and the resulting Iraqi debacle came to seem like mere bumps in the road. Even if deep down everyone knew that the spiral of overleveraging and overspending and the prices of stocks and houses were unsustainable, no one wanted to be a buzz kill.
But now everything really has changed. More than a year into the Great Recession, we still aren’t sure if there’s a bottom in sight, and six months after the financial system began imploding, it’s still iffy. The party is finally, definitely over. And the present decade, which we’ve never even agreed what to call — the 2000s? the aughts? — has acquired its permanent character as a historical pivot defined by the nightmares of 9/11 and the Panic of 2008-09. Those of us old enough to remember life before the 26-year-long spree began will probably spend the rest of our lives dealing with its consequences — in economics, foreign policy, culture, politics, the warp and woof of our daily lives. During the ’80s and ’90s, we were Wile E. Coyote racing heedlessly across the endless American landscape at maximum speed and then spent the beginning of the 21st century suspended in midair just past the end of the cliff; gravity reasserted itself, and we plummeted.
As I say to my class-”Read and discuss.”
March 26th, 2009 by Jon Taplin
Jeff Zeleny reports this morning that President Obama promised Centrist Democratic Senators that “he will think about his proposal to raise taxes on gas and oil producers, which has evoked an outcry among small producers in gulf states.” It is very clear that the obvious solution to energy conservation through the oil and gas taxes that most developed countries have adopted, will be a political battle here.
So I have another solution that would be far more politically savvy and achieve the same ends–a tax on imported oil and gas. Since we import almost 60% of our oil, the import tax would raise a lot of revenue, encourage production from the small producers who have been capping wells because of falling prices, push consumers towards more fuel efficient cars and set a floor under energy prices so that wind, solar and geothermal could be immediately price competitive. The political benefit would be that Blue Dog Democrats and Republicans alike in 0il and gas producing states like Texas, Louisiana, Colorado, California and Montana would find it hard to vote against such a tax. I know Exxon and Chevron would lobby hard against this, but they are hardly the partners Mitch McConnell and John Boehner want to be fronting.
What am I missing?
March 24th, 2009 by Jon Taplin
Glenn Beck is reaching schitzoid levels of paranoia. Pretty soon he is going to be having hallucinations on live TV.
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March 24th, 2009 by Jon Taplin
Paul Krugman is in despair. Why should I care? When some of us were writing about the coming recession 14 months ago, Krugman was oblivious, saying “it’s unlikely that America will experience a recession as severe as that in, say, Argentina.”As Barack Obama’s campaign gained strength a year ago, Krugman insisted that it was pipe dream and that Hillary Clinton was the only candidate that could beat the Republicans.
Now Krugman insists the only route for the Obama administration is to nationalize the banks. Krugman insists the public/private partnership announced yesterday by Tim Geithner is fatally flawed.
But the Geithner scheme would offer a one-way bet: if asset values go up, the investors profit, but if they go down, the investors can walk away from their debt.
So maybe he should explain why Larry Fink of Blackrock and Bill Gross of PIMCO both are willing to put hundreds of millions of their own dollars at risk alongside the government to buy these assets? As Gross explained it, he puts up $50 Million, the Treasury puts up $50 Million and the Fed loans the partnership $300 Million. Krugman assumes Gross is going to put $50 million at risk just because the $300 million is non-recourse debt?
The problem with Krugman’s whole nationalization scheme is that it creates a self-fulfilling prophecy for the Bear Raiders who have been shorting bank stocks. Assume we nationalize Citibank. The bears turn to another prey, Bank Of America. If they drive it’s stock low enough, it too will get nationalized. The big question will always be “who’s next?” The non-nationalized banks will be like wounded antelopes confronting a pack of wolves. Where will it end?
The whole Washington/New York axis of Cassandras might want to reconsider their “end of the world” rhetoric. I’d hate for Paul Krugman to look foolish three times in 12 months.
March 23rd, 2009 by Jon Taplin
This Puck Cartoon from 100 years ago depicting Teddy Roosevelt wrestling with snakes like J.P. Morgan and John D. Rockefeller, shows that economic populism is not new to this country. Writing of the Progressive Era 100 years ago, Richard Hofstadter noted that the reform movement “was the effort to restore a type of economic individualism and political democracy that was widely believed to have existed earlier in America and to have been destroyed by the great corporation and the corrupt political machine.” President Obama has to realize that the Reform moment is upon us, and it’s not going to disappear with some momentary good news on the economy.
For my money “a crisis should not be wasted” and now is the time to break the self reinforcing money cycle of “the great corporation and the corrupt political machine”. Larry Lessig and Joe Trippi have made a start on campaign finance reform with their Change Congress campaign.
Here at Change Congress, we believe that politicians should work for the people, not special interests. But it’s not enough to push politicians to stay out of the system of corruption—we have to reform the system itself. That’s why we support a hybrid of small-dollar donations and public financing, to keep big money out of politics.
As Matt Taibi’s extraordinary Rolling Stone essay “The Big Takeover”points out, the starting point for our current economic crisis was the $350 million poured by the banking, brokerage and insurance industries in the years 1997 and 1998 into campaign contributions and lobbying to get complete deregulation of their businesses. Democrats and Republicans alike took the money and the repeal of the Glass-Steagall Act passed 90-8 in the Senate and was signed by Bill Clinton.
Until we get money out of politics, every other reform issue will be a sideshow and quite likely compromised by big money special interest lobbies. Taking on this issue is not class warfare, it is the survival of Democracy.