Cruising for a bruising

Generally speaking, it's a bad idea to live in an Arab-speaking country when a Democratic President in the United States is having public relations difficulties. The attack by cruise missile becomes the go-to diversion; Bill Clinton, of course, had his "I did not have sex with that woman, that Ms. Lewinsky," followed by a few cruise missiles lobbed into Iraq (it was during the between-wars period of the Iraq Wars, when we would bomb Saddam just to keep our hand in). Now Barack Obama, who's having all kinds of trouble here at home, is taking Rahm Emanuel's Clinton-era advice and giving us, "I did not campaign for President in order to help out a bunch of fat cat bankers."

No one really believed Bill. And guess what, Barack? The only people who seemed to take Obama seriously were Lloyd Blankfein and Jamie Dimon (of Goldman Sachs and JP Morgan Chase, respectively), who didn't show the next day at the White House to receive Obama's apology for having to pretend to be angry at them. ("It's just politics, fellas.") They literally phoned it in. That's a little cheeky; those outfits owe their very existence to government largess, and here they are blowing off an invitation from the White House because of inclement weather. Could they have flown down the day before (Sunday)?

The Nobel Peace Prize Laureate expanded the hot war against al-Qaeda into that small nation down there just south of Saudi Arabia. About 23 million people, presided over by Al Abdullah Saleh, who's been president of at least some part of Yemen since 1978. International observers who monitored the most recent (2006) elections said they were at least "partly free," so the characterization of Saleh as another Arab dictator, such as the guys next door in Saudi Arabia, is maybe a little harsh. Still, that 31-year tenure makes you wonder.

A cruise missile is really something, I imagine. It flies in on its own power at supersonic speeds hugging the terrain below radar detection - more or less like a bat out of hell. Then - there it is. Packed with high explosives, it's all over you before you can do anything. So did we kill any al-Qaeda operatives? It's the usual story. Anti-U.S. sources say the attack killed about 50 civilians, including many women and children, and no al-Qaeda. The U.S. and Saleh say the attack was successful. Saleh was on board with the hit, of course. We had his permission to launch cruise missiles at his country.

One must say that there is an internal consistency to expanding the attack to any country with al-Qaeda personnel hanging around. It does answer, in a way, the question often posed about the selectivity of only bombing and attacking Afghanistan, Pakistan and Iraq, as if the operatives would cooperate by gathering there to be bombed.

There has been surprisingly little coverage about these cruise missile attacks. On one level, that kind of negates their P.R. value - how can the public be diverted from the President's political problems if the media don't write up the latest angle on the war on terror? More ominously, the silence suggests we no longer consider it a big deal when we bomb a brand new country. There used to be a lot of talk about "preemptive war" and the United Nations Charter requirement of imminent danger as a justification for a war of self defense before we gave the Go signal.

But no more. We more or less launch on impulse at any target of opportunity, I guess. It must relate to that Authorization for Use of Military Force (AUMF) back in the fall of 2001, which has been given quite a workout. It's another exception to the War Powers Clause in Article I of the Constitution, which used to confine the right to declare war to Congress. The power has become so attenuated that we can bomb a brand new country and no one even mentions it. Yet if you were on the ground looking up, somewhere in that dusty terrain of Yemen, and saw a cruise missile about to land in your back yard, I imagine it would look a lot like war indeed.

The Aughts in the Rearview Mirror

Frank Rich strolls down Memory Lane today and takes us through the dubious ten-year period which never quite acquired a nickname or handle, although the "Aughts" probably came closest. Rich describes 2001-2010 as a kind of Age of Frauds, beginning with Enron and finishing up with Tiger Woods, stopping along the way to note the misrepresentations used to sell the Iraq War, steroids in sports and Bernie Madoff. One must be loath, of course, to write off any particular ten-year period of life. If we're granted by the Good Book three score and ten, then ten years are more than 14% of the Whole Enchilada. Anyway, good or bad, it's all interesting, isn't it? Your individual ten years had lots of particular events, joys, surprises, passions, disappointments, tragedies and moments of grace which are completely unrelated to these more general societal trends. In my own life, I think about those individualized experiences much more than I spend bemoaning the fakeries of public life.

I've been reading a book by Kevin Starr concerning the history of California in the immediate post-war period, 1950-1963, which happens to coincide with my own childhood in that very state. In 1950 California had a population of about ten million people. These days, we can't really be sure how many people live here, but the best estimates put the number somewhere around 35 million, or more than 10% of the national population. The place looks like it too, believe me. I watched a lot of it happen. It always seemed strange to me that a state on the far western shore, the greatest distance from the region where the country originated, should always have been in the vanguard of societal changes, but that's the way things have worked. As Exhibits A & B, I offer McDonald's and Disneyland. The McDonald brothers opened their first store in San Bernadino in the early 1950's. My father's brother lived in San Gabriel during that period (working in the aeronautics industry as one of the "Aviation Okies," as Ernie Pyle called them), and I can remember a visit down to see his family in the pre-catalytic converter days when the acrid air stung your eyes mercilessly there in that smog canyon near Pasadena. He told me and my brothers that there was a restaurant near his house where you could buy a hamburger for 15 cents, and we had to see it. I can recall being impressed. And then we had to make another trip in 1955 or so, the year Disneyland opened. The biggest thrill for me was when my dad took me on Autopia and I drove an electric car through the loops. Here we are 54 years later trying to find our way back to electric cars.

California took the Levittown principle of prefabricated neighborhoods and applied it to the vast tracts of land available in Northern and Southern California. The area east of Los Angeles known as the Inland Empire (larger than Connecticut, Rhode Island and Delaware combined) grew up virtually overnight during the go-go days of the post-war boom. My own neighborhood was built on filled-in land over what was once San Francisco Bay. The Bay itself is only two-thirds of its original size as a result of encroachment from every point on the compass. Growing up on land reclaimed from water, in an artificial atmosphere of streets laid out on a preconceived grid, with minimalist amenities such as a "park," a shopping center standing in for a "downtown," a centrally located school, and no real open space whatsoever where nature might be said to thrive, I was inured from earliest memories to the idea of artifice and abstraction. I thought that's what America was, in essence. A fantastically elaborated artifact of suburban planning.

Trips to L.A. as a kid never disturbed this conception; indeed, it gave me a glimpse where we were headed. But occasional journeys (usually by train on the old Santa Fe) to the Deep South, where the family lines originated, let me see a more "organic" approach to living. Towns that grew naturally, where there were no sidewalks and blocks of houses were interspersed with small farms. What I didn't know then, but found out later, was that California was on the way East, and the franchising, chain-store, homogenizing pervasiveness of the Golden State would become the societal norm. Sorry about that. And beyond the backwash eastward in the U.S., you can now see the same influences in Europe and elsewhere around the globe. It seems to be one of those phases that civilization needs to live through in order to recognize as a mistake. Without knowing it in 1954, I guess, I was one of Christopher Columbus's advance scouts for the New World.

Those houses built in the 1950's weren't really built to last, but they did last, and now they're going through their demographic changes. The lily-white neighborhood I grew up in is now 64% Hispanic. California is effectively bankrupt, arguably more than the federal government since the state can't actually engage in deficit financing. So once again, California marks the path toward the future.

So relax, Mr. Rich. It's not as if all these artificial phenomena are really something new. It's a destiny, actually, this American embrace of the fraudulent and meretricious. Besides, even in California, real life goes on. Wasn't it Oscar Levant who said about Hollywood that if you dig down beneath the tinsel, you come to the real tinsel?

Homo Sapiens Commits Suicide in Copenhagen

Just for the record, I think life is meaningless and always have. Of course, when making such a statement, one should define what one means by "meaning." Okay, I think I can do this by contradistinction. To borrow a trick used by religious people, for example, who prove the existence of God by a kind of process of elimination: they can't think of any other way to explain the existence of the Universe, so they say someone must have created it. The psychologically-attuned will immediately recognize this as an instance of massive, teleological projection. It is typical of the arrogance of human beings to believe that anything mysterious must nevertheless be within human ken, and that absolutely nothing could be beyond our comprehension. So we're actually able to "think up" the way the Universe started.

So, by contradistinction (in this definition of "meaning"): I don't believe any of that. I don't think the human corpus has a "soul" or that this nonexistent soul has a destiny, that it's on a preconceived journey mapped out by a Supreme Being, or any other religious notion. Why such things would give life "meaning," I have no idea, but if that's what is meant by "meaning," then I disagree.

I think we're just here, like other species, and that's all we can say. Among mammals (and all other life forms on Earth) we have the most complex central nervous systems, and we have this apparently unique ability to conceptualize. Our mistake (which many make, I mean) is in believing that this limited ability to conceptualize would nevertheless be adequate to understand, or co-extensive with, the complexities of the Universe. Why should such a congruence exist? It's why I believe that Einstein's meditation, that "the most incomprehensible thing about the Universe is that it's comprehensible," was actually a subtle and ironical joke. What this greatest of all conceptual thinkers was actually saying was that the Universe is incomprehensible to us, but that we have a facility for mathematical modeling of Reality which has deceived us into reducing the Universe into a simulacrum of itself which we take for the real thing, yet that real thing remains beyond our understanding. So that the Universe, by presenting itself to our senses in such a way that it appears understandable, remains hidden from us. All we are doing is manipulating the data received by our senses and deducing, incorrectly, that this is the same thing as Reality. The so-called Copenhagen Hypothesis, which holds (I think correctly) that one cannot separate the observer from the observed, and that no "independent" reality exists which can be accurately observed by a so-called objective observer, is a metaphor for this basic impossibility.

So we return to Copenhagen to finish off the human race. It is not surprising that humans were not able to deal with climate change, because we did not evolve to deal with "conceptual" problems except as subjects for thinking. We cannot act in the face of an unseen danger. When the danger of global warming can be seen in its immediacy, it will be too late. Oddly enough, David Letterman, talk show host and insightful thinker, has been saying all along that "we're screwed" and we'll never deal with global warming. His informed and politically-motivated guests, such as Al Gore and James Hansen, took issue with this view, but Dave never varied.

Dave was right, the rest were wrong. One should take genius where we find it. Don't ask me how Dave knew, but he did. The remaining question concerns how great a tragedy this will be. The main problem I see, insofar as the ecosphere is concerned, is that the die-off of Homo Sapiens will inevitably take a lot of other "innocent" species with it. Some estimates say 50-60% of all mammals, birds and fish, for example. Still, with humans gone, the sun will still have just about as much time left in its Main Sequence as it has had since the formation of the solar system. So there is plenty of time left for evolution before the Big Finish. The PBS special entitled "After We're Gone" demonstrated how little time it will really take for all evidence of human civilization to disappear from the Earth, and for nature to reclaim a more natural state from the human artifacts currently in place. Even the Pacific Garbage Patch or Gyre will eventually degrade and stop killing marine life.

I'm not one of these people, like Kurt Vonnegut and Gore Vidal, who regard humans as a "virus" that the Earth is trying to get rid of, or "burn off." That's a little too ontological for the likes of me. We're not a "mistake." In Kurt's case, it was just the depression talking. There are many ways that a species finds its way to extinction, and global warming may be ours (disease or nuclear war being a couple of other routes). I was thinking that it's perhaps true that humans would not actually die off completely anyway, even with global warming (unless we have the runaway greenhouse effect called "going Venus"). We might just be reduced to a smaller, tropics-loving group with a rich gene pool. You know, of the kind found in East Equatorial Africa.

Fargoizing the National Debt

This was perhaps a little predictable:

"The United States cannot force foreign governments to increase their holdings of Treasuries," Zhu said, according to an audio recording of his remarks. "Double the holdings? It is definitely impossible."

"The US current account deficit is falling as residents' savings increase, so its trade turnover is falling, which means the US is supplying fewer dollars to the rest of the world," he added. "The world does not have so much money to buy more US Treasuries."

Thus spake an official of the Bank of China. This is indeed unfortunate, since our budgetary Ponzi scheme depends on a continuing supply of marks to keep the game going. The corporate/government merger known as Washington, D.C. must have overlooked one or two salient points in its drive to create a capitalist paradise:

First, while one can understand that Washington insiders would become careless about the 300 million citizens who make up the actual American populace, you can only indulge this attitude so far. If you create a country where tax incentives and free trade regimes result in the destruction of the labor market, at some point (such as right now) you will reach a juncture where the American masses who are not organically connected to the federal government cannot earn enough money to pay any taxes. When this happens, somewhere north of 50% of government revenues disappear (the elite One Percenters who get their money interest free from the Federal Reserve pay about 46% of all income taxes). We are currently on such a trajectory, since total tax revenues this year will probably just surpass $2 trillion, against expenditures of around $3.5 trillion or so (probably more, because there is still the Epic War to Eradicate Afghan Jungle Gyms to be funded). Adding to this slight noncongruence is the loathsome reality that over $3 trillion in Treasury debt will "mature" this year and will need to be rolled over.

The second problem is that the lumpen proletariat not only don't pay taxes, they don't have the money to buy Chinese cell phones, flat screen TVs and melamine-laced dog chow. Since the Wal-Martcentric "economy" was based on this dubious activity, the "current account deficit," which the Chinese (and their Amen Corner in the U.S. Congress) used to be so happy about is now disappearing. Memo to Mr. Zhu: the American worker is not "saving," per se. He's trying to stay indoors and consume food.

The question then becomes how to finesse your way past the need to auction off something on the order of $4.5 trillion in U.S. debt without having even a single failed auction. If an auction is held and nobody shows up, then for the first time in living memory a holder of U.S. Treasury securities will have to be informed that we don't have the money right now. Personally, I would recommend simply not returning phone calls from foreign central banks. A model for this kind of dodge was probably best demonstrated by William Macy in "Fargo," where he strings out the financing company for as long as possible by (a) not returning calls, (b) promising but not delivering and (c) sending unreadable fax messages. I don't see why Timothy Geithner couldn't use all of these techniques.

Scene: Office of the Secretary of the Treasurer, Washington. A secretary answers the phone.

Secretary: Mr. Secretary, Mr. Zhu is on line one. Again. He says you still haven't credited his account with that $50 billion on the maturing T-bond.

Geithner: Can you tell him I'm in the bathroom right now and I'll call him right back?

Secretary: Okay. (Murmuring into phone.) He's wondering if you're eating too much Mexican food. That's the fourth time in two days you've been...indisposed.

Geithner: Tell him I promise I'll get back to him. Get a number.

Secretary: (Murmuring.) He says he'll hold.

Geithner: Tell him the computer's been down all day and we'll probably get that transfer made by tomorrow morning.

Secretary: Okay. (murmuring). He says he still wants to talk to you because that's what you said yesterday.

Geithner: Tell him I died.

Anyway, Geithner and Bernanke (if he gets confirmed) will think of something. They're very resourceful, and they own a printing press. Money, schmoney. Let's build the B-22 after all. Our best days lie straight ahead.

Tea for Two...or Three Hundred Million

I watched a little of the Bernanke confirmation hearing this morning on C-SPAN, as the august solons on the Senate Banking Committee took turns either commending Gentle Ben for a good job in difficult times, or ripping the guy a new one. Although Bernanke is a Republican, most of the opposition to him comes from Republicans such as Jim ("No Hitter") Bunning and Jim DeMint. Being against Bernanke is a kind of code for "Main Street" advocacy, whereas support for Bernanke substitutes for a wink and nod to the Senate's benefactors on Wall Street. As to the question of whether Bernanke is doing a good job - who the hell knows? I can still get money out of my ATM, so that's a plus.

I noted that a few of the Senators have started to say openly that the United States is in a helluva financial bind. That's alarming. For example, former Texas pom-pom girl Kay Bailey Hutchison wondered out loud whether the U.S.'s credit rating is in jeopardy, and whether we aren't staring down the abyss of sovereign default. Heavy stuff. Well, the House just increased the debt limit by about $300 billion as a stopgap measure to keep the government in business. They wanted to go $1.8 trillion, to get the ceiling up to $14 trillion and leave it there through the 2010 midterm elections (so the somnambulant electorate would forget about it, in other words), but the crafty Republicans, who derive an amazing amount of juice out of being a distinct minority, wouldn't let them get away with it.

Excessive government spending is part of the "Tea Party" agenda, apparently, although it's hard to label this diffuse political "movement." The Tea Party seems more like an aggrieved, amorphous mob that is definitely aware it's hurting but only dimly cognizant of what might be causing the pain. A group like that is inherently dangerous. Sad to say, just as Bush set the table for Obama, I think Obama's capitulation to...what?... has set the stage for the Tea Party. Here's something from the Wall Street Journal:

The biggest worry for Democrats is that the findings could set the stage for gains by Republican candidates in next year's elections. Support from independents for the president and his party continues to dwindle. In addition, voters intending to back Republicans expressed far more interest in the 2010 races than those planning to vote for Democrats, illustrating how disappointment on the left over attempts by party leaders to compromise on health care and other issues is damping enthusiasm among core party voters.

But public displeasure with Democrats wasn't translating directly into warmth for Republicans. Twenty-eight percent of voters expressed positive feelings about the GOP -- a number that has remained constant through the Democrats' decline over the summer and fall. Only 5% said their feelings toward the Republicans were "very positive."

Well, that makes sense. Naturally, the Wall Street Journal would use the normal bipolar analysis: if not Democrats, then Republicans. Between now and 2012, however, things could change a lot, especially if our recent convert to fiscal austerity, Kay Bailey, is right. Naturally, her new belief in a balanced budget wasn't around when she enthusiastically voted for every war Bush&Cheney could come up with, but hey - that's so 2003. It's hip now to talk about "Obama's spending," and to direct everyone's attention to Bernanke, who's been on the job since 2006.

This is an early sign of impending doom, when the jugglers in the Capitol Clown College start aiming their seltzer bottles at each other, or sticking out their size 22-EEEE red shoes as another senator walks by. It means they're beginning to realize that this fiscal crisis probably cannot be hidden much longer. Now where would they get an idea like that? Well, that strange chart up above may give you an idea. This is one of Tyler Durden's (of Zerohedge) typically brilliant summations of just how massively screwed we are. Looks innocent, huh? Yet within its clear, elegant and horrifying details lie the sure signs of ominous portent. The UK, Japan & China, our BFF's when it comes to keeping us afloat, are beginning to peter out. This is an inauspicious moment for this to be happening, because, you see, Congress has authorized the government to "spend" about twice as much money this year as it actually "has." This is on top of the $7-8 trillion we'd piled up in previous years of keeping the world safe for democracy.

The Tea Party people use the iconography of a great patriotic rebellion, the Boston Tea Party of 1773, which protested taxation without representation. A nice heritage. The Journal, I think, is engaging in some wishful thinking in believing that: If not Dem, then Repub. Not necessarily. This is very worrisome. The Tea Party, whatever it is, does not have to know what it stands for in order to be convinced that neither of the Big Two Parties is on their side. Such dangerous stuff. They lack only a corn-pone Hitler to lead them in their fervent belief that they can be great again. And if recent history in the USA has taught us anything, it's that demagogues, in this country, are a dime a dozen.

Jake & Elwood would never break out of this Illinois prison

Obama did promise to close down Guantanamo, and damn if he isn't a man of his word. The hapless denizens of the Cuban Club Fed are moving north to the Thompson Correctional Facility in Illinois (not so far from the Blues Brothers lockup in Joliet), only about 100 miles west of the President's private residence. This major development has all the characteristics of other Obama major developments:

1. It isn't a major development at all. Of the 210 detainees in Cuba, maybe half will go north for now. This makes it look as if there is compliance with Obama's campaign promise to close Guantanamo "within one year" without actually, you know, closing Guantanamo within one year. It is that perfect Obamian compromise with the truth - halfway between doing the right thing and kowtowing to the demands of the howling Right, who believe that the very presence of a Muslim detainee on U.S. soil poses a clear and present danger to the survival of the Republic.

2. Although the transferred prisoners will reside in the American heartland, they will not see the inside of an actual American court room. Some of them will be tried before military commissions; many others will be detained indefinitely without trial, without charges and basically without hope. William Lynn of the Department of Defense has announced that the choice of forum, or the decision not to have any forum at all, is determined on the basis of the likelihood of a favorable outcome for the prosecution. Federal trials in civil court rooms are reserved for those defendants with the least chance of escaping conviction. If the case against a given prisoner is relatively weaker, then trial proceeds before a military tribunal, where the rules of evidence are relaxed in favor of the government and the tribunal itself is more likely to convict. If even this kangaroo proceeding cannot be relied upon to assure conviction, then the government plays its ace in the hole: the prisoner is just held indefinitely with no charges and no trial.

Thus, the system is set up so that the weaker the case against you, the less justice you are afforded. I think this is the Winston Smith principle of jurisprudence.

3. As a legislator and as a Democratic nominee on the campaign trail, Obama was against military tribunals altogether, and spoke out against the tyrannical practice of detention without trial. Now all of that has changed. The underlying rationale which Obama must have adopted during the last twelve months, at some point after his election was assured, is that a Muslim detainee in Guantanamo must be there for some reason, so it's logical to assume that the prisoner is guilty; that is, that a presumption of guilt exists. Whether the United States can prove it or not is somewhat beside the point, although from the viewpoint of the prisoner, I suppose, it is the point entirely. The fallacy, not often publicized (but which my membership in a legal bar compels me to point out, since I am required by the Canons of Ethics to advocate for justice even for those whom society despises), is that the right of habeas corpus, finally regained by the detainees in the Supreme Court case of Boumeddiene, has been exercised successfully by detainees in 29 out of 33 cases, or 88% of the time. The presumption of guilt which has supplanted the previous (220 year) history presuming innocence (as enshrined in the Bill of Rights), has been moved aside for purely political reasons unrelated to (a) actual danger to the United States or (b) common decency. Thus, the idea of detention without trial, in the face of such a procedural history and possibility of error, seems nothing short of tyranny.

I was watching an interview of Rep. Joe Barton (R, Tex.) yesterday as he fulminated against the grave danger of moving these awful terrorists to Illinois, where, despite the supermax conditions (from which no prisoner has ever escaped), they are likely to successully plot the total destruction of the United States. I guess that Barack Obama keeps thinking that if he splits the difference, closes Guantanamo while keeping its spirit of injustice alive, he can mollify his critics on the Right, as he has tried in so many other instances. That it never works doesn't seem to matter. But I suppose what guys like Barton have learned is that if they remain vociferous and keep complaining, even when Obama does more or less exactly what George W. Bush would have done in the same situation, that they can keep moving the President farther and farther in their direction. Until one day, in the probably not too distant future, they may have the satisfaction of thinking that things have never been so good, and that the election about a year ago, which seemed so transformative at the time, actually didn't amount to much at all.

Tin foil hats and other seasonal costumes

Sometimes I wonder whether I actually have to have some quote or news item to base one of these cognitive spasms upon. For example, one idea that occurs to me this morning (as I siphon some Peet's coffee into my synapses) is that maybe hikers should just stop climbing Mt. Hood in Oregon in the dead of winter. You know? I mean, doesn't this tragedy get a little repetitious? Is it actually surprising that blizzards would hit a mountain 11,240 feet high in the Cascade range in mid-December?

Just a thought. That's not actually the text of my sermon. I keep getting drawn back to the Economy as a subject. As I've said before, my inspiration, Henry David Thoreau, based his longest chapter in Walden on Economy for the simple reason that what we call the economy is essentially a description of the means by which humans derive their vital heat from Planet Earth in order to sustain life. For this you need food and shelter. Of course, very few Americans are actually engaged directly in these processes anymore. We eat food and we live in houses, but we don't grow the first or build the second. That's because we're "advanced," and live in the "organic" society, which is a very complicated contraption built upon hyper-specialization. Meaning, of course, that most of us are engaged in completely useless functions which can be easily discarded by society with no discernible loss to the core function of maintaining vital heat.

As part of the elaboration of our complexity, American elites thought it would be a good idea to get into a symbiotic relationship with the People's Republic of China, a Communist dictatorship, and to outsource our manufacturing jobs. Those are the jobs we built our former middle class upon. The Commies in Beijing run a command economy of the type favored by Josef Stalin, noted tyrant of the former Soviet Union. This means they can play any game they want with wages, currency fluctuations and anything else. They pegged their yuan to the dollar, which allows them to keep Chinese wages at the munificent average sum of 31 cents an hour, or about $2.50 a day. So the average annual compensation in China is about $3,000. In America, for a little while longer, the average annual earnings are $47,000. However, because of the symbiotic, and somewhat paradoxical, relationship that exists between our two great nations, one would expect that, as water seeks its own level, a gradual evening out would occur to "fix" this disparity. This is currently underway, although it won't continue.

So as I was hoovering in some of Peet's rich, oily, aromatic caffeinated brew, it occurred to me that we could forecast America's fate by simple mathematics. One cannot simply add the two income levels and divide by two, because China's population is four times larger than ours. So a weighted average makes more sense. We can take the sum of $12,000 (4 x $3,000), add that to $47,000 [$59,000], and divide by 5. So we're headed toward average annual earnings of a little under $12,000 per year. Isn't that nice of us to lever up the Chinese that way? I think so. They make stuff and export it to us; we export dollars to them; they export the dollars back to us; we make cheap loans to ourselves and inflate "assets" we can borrow against. This creates "money" that we use to buy more stuff from them.

Oh hell. Like all perpetual motion machines, this neat little setup ran afoul of the laws of thermodynamics. The contraption broke down. While this is a disaster for us, it's also a calamity for the Chinese. They have those 100,000 factories, they're up to their eyeballs in salad spinners, Snugglies, pirated CDs, flat screen TVs, poison dog food and radioactive Gerber's, and they don't have the money to buy it from themselves.

Meanwhile, back at the Ranch on Capitol Hill, certain expectations about the continuance of this neat symbiosis had taken root. We really, really need the Chinese, and other helpful Asians, to help our government with its spending problem. Lately, it's gotten somewhat out of control. In addition to rolling over the Mount Hood of debt (see: this is called "thematic unity") we had already amassed, we thought it would be a good idea this year and the last to throw on another $1.5 trillion or so of new debt, sort of like fresh powder over the frozen pack of yesteryears. So we need a lot of help with flogging about $150 billion per month (October and November indicate we're on pace for a $1.8 trillion deficit, not quite as good as we hoped) of Treasury bills, notes, bonds, you-name-it, over and above all the stuff that keeps coming due from all the previous decades of empire building and defending the world against -- well, Communists.

And dag nab it, right when we needed them most (and isn't this just like a Commie?), the Chinese became kind of disinterested in our problem. They are becoming net sellers of our Treasury IOUs. You see, the conveyor belt needs to run in a complete loop to keep the Chinese focused on our problem. If we stop buying stuff from them (and we're stopping), then they don't receive those dollars to send back to us. And do you think the Chinese are just going to come up with the money to take care of us? My sentiments exactly.

You see, here in America the idea that our standard of living should go down just because the vast majority of us are engaged in completely unproductive employment was absolutely - politically, emotionally, even morally - inadmissible. We would "stimulate" the American economy back to life, dammit.

Well, we still have a few tricks up our sleeve, you know. If the Chinese won't give us our money back (because we didn't send it to them to give us), we'll just make some more, because we are not going to settle for any 12,000 bucks a year, even if it's what we deserve. So if you're looking for a good investment play, I would suggest Lexmark. They make toner cartridges, you know.

Signs & Portents

I'm kind of bummed that Dmitry Orlov has indicated he won't write satirical pieces anymore on his blog because it's become "bad taste." By which he means, his predictions of American collapse are now on such solid footing that they are no longer controversial - indeed, it's a matter of looking out the window to verify his prescience. So, he goes on to say, in essence, satirizing America is like "cracking jokes at a wake." Reading James Joyce, however, I get the idea this is exactly what the Irish in fact do at a wake. What else are you going to do? Besides guzzle Jameson's, I mean.

I note with fatalistic alarm that the state of California is putting a whole bunch of office buildings on the market, including the whole Franchise Tax board "campus." Isn't there a little bit of irony there? Taxes themselves are insufficient, so let's sell the damn building itself. That is what you might call late-stage desperation. The idea is that the state could raise as much as $660 million by selling all this real estate. The Controller (John Chiang) is ecstatic at the prospect, and he needs things to elevate his moods, I bet. Let's say that the net/net haul on selling this stuff won't be "optimal" in this particular commercial real estate market, even though Chiang is gung-ho because the new owner gets a "Class A" tenant along with the building. I'm a man who loves a good contradiction in terms. A Class A tenant? Isn't that the very bankrupt state who was just forced to sell the place?

Anyway, let's say that Kal-ee-for-nee-yuh actually raises $500 million. Makes the math easier, and as you'll see, it doesn't make any difference. The state's budget deficit is $20 billion. Thus I can calculate (even though I was educated in California public schools) that this magnificent windfall will take care of 2-1/2% of the deficit. For one year. Now we have to figure out how to take care of the other 97.5%. Or, to round up, the other 100%, because the actual budget deficit is worse than $20 billion. That's just the number Chiang is using to keep from dousing himself with gasoline in a public square and striking a match.

Fortunately, there's a "recovery" underway. So once we retire 2.5% of the deficit this year, everything will be fine next year with our booming economy and everything, and there's no chance of an unlawful detainer action to oust the state from all those buildings it used to own but now leases. I mean, it would be humiliating for the Franchise Tax Board to get evicted and have to resort to collecting taxes from local high school gymnasiums.

One fellow on the Zero Hedge blog, who strikes me as particularly perspicacious (I think the word was on the verbal SAT), commented that he doubted the states were going to have to "secede" or "rebel" or any of that nonsense. The breakup of the USA would occur quietly, almost as a matter of course. It would happen this way: the U.S. Government is going to default on its debt. If you look over there to the right at the National Debt Clock, you'll see a number whirring by. Here's the curious thing: the National Debt Limit is $12.104 trillion. How's this one work? Oh, Geithner & Crew have ways. Anyway, they just don't care anymore. It's gotten to be too much. There's a lot of talk about "replacing" Geithner. You know, as if they'll find someone else anxious to hold auctions every frigging day in a sweat-soaked effort to keep raising all this dough. The estimate is that the U.S.A. will need to "roll" about $5 trillion next year on the public part of the debt, which will soon hit close to $8 trillion. More than half of the debt is in notes with durations of under one year, so it must constantly be rolled over to keep the game going.

Where's the money going to come from? The auctions are already beginning to look a little wobbly - the Treasury is paying more in interest on longer term bonds than it wants to pay, and the action ("bid-to-cover") is falling off. China and Japan have problems of their own, and their export market (the U.S. consumer, in other words) is not that reliably insatiable pack rat he used to be. China buys more cars and refrigerators now than we do.

In short, just as Greece, Latvia and Dubai suddenly imploded, the U.S. could have a full-fledged funding crisis on its hands in the blink of an eye, brought on by one failed auction. That's all it would take for panic to set in. At that point, the states (such as West Austria, where I live), which are already in a hopeless financial condition, are going to wonder whether it makes a lot of sense to keep pouring money into the fiscal black hole known as the U.S. Treasury. Anyway, that's the Zero Hedge guy's theory. Americans will devolve by dissolving into a piecemeal map of independent regions.

One thing has become obvious from watching Congress attempt to deal with anything: they are simply not capable of practical solutions to real problems. On this national debt thing, they plan to attach a rider to the defense spending bill increasing the debt limit to $14 trillion so the Republicans will have to vote "against the troops" to avoid increasing the debt. Pretty clever, huh? And blatantly dishonest, but they don't care about that anymore. D.C. is simply an enclave, a walled and gated community where they take care of themselves and broadcast propaganda to keep the natives calm.

For how much longer?

The Good Guy, Bad Guy Narrative Never Gets Old

I acknowledge my debt to Karl Denninger for the graph above (which I think you can see in a separate window by clicking thereon), which he frequently displays on his Market Ticker blog as a Big Picture of American profligacy. I think it's particularly powerful in assessing whether the Little People vs. Robber Barons narrative actually gets at the heart of the American malaise or not. I tend not to think so. It is, of course, alluring and attractive to think that one's own economic woes are attributable to the machinations of the Powerful Few, the Illuminati, the Jewish Banking Cartel, the Overworld, etc. Hitler surely used this kind of rhetoric as a cover story for German debasement after the First World War. It was that dreadful Versailles Treaty and the House of Rothschild, not that atrocious war we started.

We grew up with stories like that. Cowboys & Indians, Cops & Robbers, playing Army where we killed Nazis and Japs. It's part of our mythology, and it forms an unconscious matrix through which we comprehend Reality. For example, lots of the current criticism of Barack Obama has to do with his capitulation to "Wall Street." Here's Robert Scheer today, disgusted by receiving an e-mail from Barack Obama asking for money to fight the cause of "Main Street:"

Barack Obama's faux populism is beginning to grate, and when yet another one of those "we the people" e-mails from the president landed on my screen as I was fishing around for a column subject, I came unglued. It is one thing to rob us blind by rewarding the power elite that created our problems but quite another to sugarcoat it in the rhetoric of a David taking on those Goliaths.

Robbing us blind. Creating our problems. That's how Scheer decides to look at the bailouts, the financial collapse, the Depression. Not as the inevitable result of societal decadence. We were good, honest, thrifty, industrious citizens, and we got taken. They took advantage of our simple, native virtue.

It is true, I will grant in a trice, that we allowed a small handful of super-powerful financial institutions to become "too big to fail." We did this because every president, Democratic and Republican, stopped enforcing the Sherman Anti-Trust Act. Because the SEC went to sleep on the job. Because a Republican Congress submitted a bill in 1999 to repeal the Glass-Steagall Act, which a Democratic President, Bill Clinton, signed into law. And a hundred other affronts to common sense and fiscal sanity. These errors and omissions did not begin occurring when Barack Obama was inaugurated, nor during the misrule of W, nor at any other politically convenient moment to start the clock running on "corruption." They have been part and parcel of the American experience (our "lifestyle") since around 1980 or so. That is what Mr. Denninger's Big Picture is meant to show.

From the post World War Boom through the 1970's, we did fine. Debt to GDP remained stable at about 150%. We then decided that living within our means was unnecessary. This applied across the board, at the individual and government level. If our flat-lining wages (a result of international competition coupled with the beginning of job "off-shoring") were insufficient to maintain us in what Dick Cheney called our "non-negotiable" lifestyle (was ever a stupider man more widely praised for his brilliance?), we would borrow the difference. Reagan took this method to heart, and federal deficits began exploding. We would crush the Soviets by massive increases in defense spending, and support it all by borrowing from around the world. The Soviets could not compete with that. Of course they couldn't. Why would they want to? It was the beginning of the end of the solvency of American government, too, after all.

America's materialist obsessions led to the proliferation of vast tracts of suburban (and "exurban") development, all financed on a thin sliver of equity and massive leverage, as debt to GDP went from a manageable 150% to a totally out-of-control, unsustainable 350%. We built big cars and financed them the same way. We were notorious for our energy inefficiency; when we began to run out of oil here at home (in about 1970 we hit Peak), we started importing increasing amounts, leading to big trade imbalances. Unconvinced that this mattered, Americans began building and buying SUVs, gas-hogging behemoths with the ride characteristics of a dump truck and the entropy profile of a Sherman tank. Houses got bigger and bigger, far more expensive to heat and maintain, and energy usage skyrocketed as every room in the house became the site of a power-surge strip connected to a display of electronics rivaling the control deck of Starship Enterprise.

We gave up on exercise, higher culture, public transportation (where oh where are our high speed rail connections?), and settled in front of the TV to watch Jen & Phoebe dumb-talk their way through another faux-crisis, eating cruddy food stoked up with high fructose corn syrup. Thus, we became a nation of fat, diabetic cardiac candidates, waddling to work as Greeters at our largest employer's Emporia of Despair, a crap merchant specializing in selling lead-based, melamine-enhanced junk.

Yet, in our own minds, we remained Exceptional. We felt entitled to live at a certain level, surrounded by what was largely an eye-offending opulence, engaging in the national pastime of vicarious battle through watching contests between steroid-riddled physical freaks on huge screens of flowing pixels, which we had substituted for "Reality" (at one time known as the "Outdoors.") We were running out of ways to borrow our way to maintained prosperity. The credit cards were maxed, the repo man was out front hotwiring the Escalade, so we looked to that one remaining piece of collateral, the roof over our heads. And it was here that the Banksters, who had already figured out to how to "spread the risk" (to the entire world, in fact), by "securitizing" credit cards and student and auto loans into "bonds," came to the rescue. Hell, they had to do something. The equities markets had peaked in the late 1990's, so the "investment banks," which used to be called "stock brokers," no longer had any "stocks" to "broker." So we came to their rescue, too. The entire mortgage industry could be used as seed money for a new way to gamble at the Wall Street Casino, and the basic bet (the mortgage, which was no bet at all because housing prices "always go up") could be hedged with side bets in the form of credit default swaps (betting the Pass/Don't Pass Line, in other words), and the circle was complete. Wall Street was rich again, the Booboisie could use recycled money from China to live like kings. How could such a scheme fail? Our houses went to work for us. When the loan came due, or you needed a new Lincoln Navigator, you tapped the always-growing equity to roll it all over, pocketing $50 k for toys at CostCo while you were at it.

It was a perfect system until it wasn't. We liked it so much that the Obama Administration and the Fed are working around the clock in feverish attempts to bring Shangri-La back to life.

But now we've turned on them. We've decided, despite that thirty-year history of increasing decadence and irresponsibility occurring on a society-wide basis, that it's not our fault. They tricked us! They told us we could have something for nothing. We could keep electing the same corrupt assholes who were shipping all of our jobs overseas and leaving us with a "service/information" economy (the Information being: we're broke), and it was okay as long as we could sign our name, or fog a mirror, in order to "qualify" for a loan that would put us in a house that would solve all our problems.

As I say: such a nice, convenient, exonerating narrative. Everything that seems to have happened over decades actually didn't start until the fall of 2008. Hey, it works for me. You go, Ben. Bring back my piggy bank, or someone gets hurt. When can I re-fi?

Deciphering the Afghanistan Strategery

Marwan al-Shehhi (prior to impact).

While other (monetarily compensated) pundits play the "inconsistency game," demonstrating that Pres. O insists that July, 2011 is a firm deadline, while his acolytes, Hillary and Bob Gates of Defense maintain the date is only some sort of aspirational notion binding on no one; I take the next step, the step of synthesis, and conflate the various interpretations in a Grand Unified Theory of Afghanistan Withdrawal.

I offer you this: if by July, 2011, we can figure out why we were ever there, we'll stay longer. If not, not.

It's really not so hard, you know, to make an effort to see things in a light more favorable to our somewhat embattled Prez. And in my case, I do so without the condescending pandering offered up by the likes of Frank Rich in today's New York Times:

We want to believe that Obama’s marvelous powers of reason can check a ruthless enemy and reverse decades of tragic history in one of the world’s most treacherous backwaters.

It ain't really like that. As I've written before, this kind of comment reflects the effort to be politically correct and kind of conspicuously un-racist, while betraying an underlying racial consciousness. Hey, if Obama is doing dumb things, he's doing dumb things. I'm sure the President would rather be criticized for simply blowing it than to be accused of misapplying his "marvelous powers of reason" in a patronizing criticism. Yet Rich's own marvelous powers of reason seem to have deserted him in repeating the fallacy that the attacks of 9-11 "originated in Afghanistan." Quoting Obama approvingly, Rich notes:

“Most importantly,” the president said, “unlike Vietnam, the American people were viciously attacked from Afghanistan and remain a target for those same extremists who are plotting along its border.” This is correct as far as it goes, but it begs a number of questions.

Look, all I know is what I read in the official Report of the Commission on the 9-11 Attacks. What is amazing is that Obama could give an entire speech about the necessity of the war in Afghanistan and never utter any of the following words: Egypt. Saudi Arabia. United Arab Emirates. Lebanon. That's where the attackers were from. The 15 muscle hijackers, all from Saudi Arabia. Atta, from Egypt. His buddy and main co-conspirator, Marwan al-Shehhi, from the UAE. Heck, even the "mastermind," the Gurgling Confessor Khalid Sheikh Mohammed, was from Kuwait.

Al-Shehhi left the UAE in 1996 and traveled to Hamburg, another site on the terrorist map which Prez O did not mention. At a mosque there he met Mohammed Atta. The suspicion is that these two ringleaders (the actual "masterminds" of 9-11) became radicalized by exposure to the West while students in Germany. In time it would be Atta who hit the first World Trade Center tower, al-Shehhi who hit number two. American intelligence sources also figured out that sometime in the summer of 2001, Atta traveled to Spain for a brief period and probably met with an accomplice/financier. Who was that person? My guess is that it was not a guy who bought an extra seat for his dialysis machine for the flight from Kabul. I'm absolutely certain the CIA figured that one out a long time ago - they know whom Atta met in Spain, and they probably know why. That person may represent the sources who supplied the fairly modest bankrolling the 9-11 plot required, and they may not have been in Afghanistan at all.

But even under the prevailing theory, that Osama bin Laden was the financier and Grand Strategist: To say that the "attacks originated in Afghanistan" is a little like saying that if a Saudi withdraws money from his account at UBS in Switzerland to buy a handgun, travels to the United States and then shoots someone, that the attack "originated in Zurich." It originated in Zurich, as the Bushies claimed 9-11 originated in Afghanistan, if you need it to. That doesn't make it logical or the subsequent war against Afghanistan (or Switzerland) any more justifiable.

Bush came up with Afghanistan because it was the closest thing to a country with a connection to 9-11 that he felt he could invade. He couldn't attack Saudi Arabia or Egypt, obviously, because the thugs in charge of these tyrannies are allies of ours. We couldn't handle the attacks as an international crime (which they were) because, really, almost all the perpetrators were already dead, and anyway, Bush had already declared that the 9-11 attack was an "act of war." And finally, Bush needed a real war, using the whole military, as a massive overcompensation for the tremendous embarrassment to him personally which the 9-11 attacks represented. I mean, think about it: he was specifically warned a month in advance. The FBI under the direction of his Administration had submitted field reports that Atta, Shehhi and others were taking unusual commercial pilot instruction in which they slept in on the days the class covered taking off and landing (exaggeration for comic effect). And they were taking this instruction in American flight schools in Florida and Arizona. 15 of the 19 attackers had violated one or more terms of their visas and were subject to deportation. The plot could have been stopped, as numerous other terrorist attacks have been stopped while still in the planning stages.

For me, that was always the great tragedy of 9-11. Our intelligence agencies, at the field level, actually did their work very well. They did what they were supposed to do.

Maybe by July, 2011, Obama will train those formidable powers of ratiocination on the original reason for the war in Afghanistan and conclude that, after a decade of pointless war, the former presence of a few al-Qaeda operatives and a cluster of jungle gym complexes are not the sine qua non of Islamic terrorism. Pissed-off Muslims are the necessary condition, and the CIA (doing its usual good work, and no irony intended at all) has warned repeatedly that these serial wars of foreign occupation do nothing but expand the numbers of the pissed-off. Pissed-off Muslims, like those radicalized in Hamburg, do not need jungle gyms or one country as a "safe haven." They are ubiquitous, fungible, well-dispersed and they can travel light. The best defense is to do exactly what we did before 9-11, with the exception that we have a government, and a President, who take their jobs seriously.

Tiger Tiger Burning Bright

Fearful symmetry indeed. One thing I have to say at the outset, it's hard to see this story as completely tragic. Okay, I know, the kids, the kids. But leaving the kids to one side for a moment...

Also, I do understand it's no one's business except Tiger & Elin's, but where's the fun in that? Anyway, my approach is to offer an angle on the story-within-the-story, to adduce what general truths about humanity might be divined from a careful scrutiny of Tiger's current predicament. And writing about the Federal Reserve Bank gets a little dry.

Tiger's wife Elin is a model (or was, till she struck it rich) from Sweden. She has a brother and a twin sister. That latter fact raises fun speculations. Elin (pronounced Elin) is 29. She and Tiger were married in 2004 on the 19th hole of a golf course in Barbados. Elin is the father of Tiger's two children, neither of which is named Tiger.

The Other Women, so far: Rachel Uchitel, 34, a "club promoter;" Jaimee Grubbs, 24, a cocktail waitress and reality show contestant; Kalika Moquin, 27, "marketing manager" for The Bank night club in Las Vegas. To date, only Rachel is represented by Gloria Allred. I surmise, therefore, she probably has the best story. Gloria will help her roll the story out in a maximally profitable way, while also making sure that Rachel is not "victimized" or "stigmatized" as Other Women so often are, according to Gloria. This is Gloria's niche practice: the representation of people who have no need for a lawyer but are on the periphery of cases involving people who do. Anyway, the dignity of the women involved is important. I note that they are talking in terms of "affairs" or even "relationships" to describe the random hook-ups with Tiger they've enjoyed over the last couple of years. This is true in about the same sense that Tiger has a "relationship" with his rental car while he's in town.

Tiger is 33, by the way. The mean age of Elin, Rachel, Jaimee and Kalika is 28.5. I think this makes things somewhat easier for Elin, although Jaimee, the reality TV show contestant and cocktail waitress, is an outlier who pulls the sample's average down somewhat, which doesn't help Tiger's cause.

Most of these affairs seem to be of fairly recent vintage, starting up after his two children were born. Here's my take on what's been going on: Elin has been busy a lot with the two kids at home in the mansion in Windemere, Florida. Tiger's a touring professional with an awful lot of money and a great deal of time on his hands when he's on the road. He stays in hotels and goes to restaurants and night clubs. There he might meet club promoters, cocktail waitresses and marketing managers with plumped lips and saline (by volume) in their chests equal to the displacement of the Titanic. These "hospitality workers" are on the payroll to doll up the place. To relieve the stress and boredom of life on the road, Tiger started plunking these gals whenever he was in town. While Tiger himself is a Stanford man, it was probably a matter of supreme irrelevance to him whether Rachel, Jaimee or Kalika (or Elin, for that matter) was a member of Mensa.

Tiger apparently told Kalika that married life had gotten a little dreary, which can happen with a couple of rug rats and the same wife he'd already been married to for five whole years. Ultimately, it's a question of philosophy. As to what happened that night at 2 am between Elin & Tiger, maybe what transpired is that Elin slipped Tiger an Ambien as truth serum and went to work on him while he was in a semi-hypnotic state. It's doubtful that rumors of Rachel, Jaimee and Kalika had entirely escaped Elin's attention. Tiger might have been out of it enough to confess to too much, but not so sideways that he couldn't tell it was time to get the hell out of Dodge. Thus, his bumpy ride down to the street, with Elin, still interested in continuing the interview, giving chase while brandishing (what else?) a golf club.

It's only a theory. Depending on what's in the prenuptial agreement, we may or may not find out what really happened. The police cannot force either party to testify against themselves nor the other party (husband and wife privilege).

As to what the future holds, it probably depends in part (but not entirely) on how many other women sashay forth from behind the velvet ropes in night clubs, bars and hospitality suites. The PGA tour goes pretty much everywhere, after all, and there is no name bigger than Tiger's.

He has neither sunk lower, nor risen higher, in my personal estimation. He's obviously a guy who likes to cat around. This is hardly unique, although for some reason everybody always pretends in these situations, including the guy who gets caught, that it is unusual. If Elin and Tiger patch it up this time, Tiger will be back on the prowl in no time, burning brightly in the forest of the night. It's his nature, of course, although currently he's apologizing for it. Gillette is insisting on that, I'm sure. Elin will have choices to make. She's learning, along with the rest of us, what the guy she married is really like. Life might have looked like one long, green fairway a few years ago, but now the ball has landed squarely in the rough.

The Obama Speech, or: Huh?

Well, that was different. Now I really don't get what we're doing in Afghanistan. I think the idea is that we will fight a war against the Taliban and the 100 or so remaining members of al-Qaeda in Afghanistan in order to encourage the Pakistani government to keep the same miscreants away from the nuclear weapons in and around Islamabad. We will keep doing this until about July, 2011, at which point the problem will have been solved, in perpetuity. The cost of the 100,000 troops, based on our new consensus-accepted calculation ($1 million per soldier per year), through July, 2011 will be somewhere in the neighborhood of $150 billion and however many lives are lost.

Something occurred to me as I watched our President go through the motions of this speech. One of Barack's main problems is that Bush left such a disheveled mess of a country in his wake that practically everything Obama does is simply an echo of Bush's agenda, either in furtherance or in contradiction thereof. The wars, the economy, the bailouts, the budget deficit, everything he spends his time doing is in reaction to the colossal catastrophe of the Bush years. The lone exception is health care reform, and let's face it: Congress is simply unequal to the task. It was a mistake for Rahm Emanuel to assign such a monumental undertaking to this group of clowns. They'll never come close to putting anything coherent together.

So the outlines of Rahm's reelection strategy for Barack are now plain. Barack's initiatives are done, because we're out of money, especially with these new war costs. The decision to focus on deficit reduction means that we're barely going to scrape by holding the federal government's core operations together. So Rahm's idea is that Barack, as of the fall of 2011 (one year before the election), will at least be able to say that the country is at relative peace. As for prosperity, maybe things will be somewhat better. One can hope. If so, then the reelection campaign will be based on the concept that Obama brought us peace & prosperity.

If Barack had simply announced a withdrawal from Afghanistan, he would have exposed his Right flank (the only one he cares about) to the criticism that while the redoubtable, pugnacious Bush had the courage of his convictions and ordered a Surge, thus "winning the war" (just before the Ungrateful Nuri told us to leave), Obama didn't have the tenacity to Stay the Course, put Boots on the Ground, and Prevail; that is, to do a Surge of his own. In the fall of 2012, the argument would never have worked that Obama did what he did (pulled the troops) because it was fiscally necessary and the war made no sense anyway. Too complicated - no one can follow that. The reasoning is in two parts, whereas "we stayed and won" is easy to remember. The timing is perfect: the Status of Forces Agreement with the Ungrateful Nuri requires us to have all combat troops out of Iraq by August, 2011, coinciding with the withdrawal of American troops from Afghanistan in July of the same year.

Everyone comes home, and wins across the board! All we have to do in Afghanistan at that point is declare our victory. No one will be able to tell one way or the other. Does anyone know whether we've "won" in Iraq? Nuri is widely regarded by the Iraqi people as a Shiite version of Saddam, running a police state complete with torture chambers, political prisoners, repression and probably the suspension of scheduled elections. He has close ties to fellow Axis of Evil member Iran.

But it's a Win, because it's too complicated to figure out that it isn't. Similarly, any Republican who says that we left Afghanistan (or Pakistan?) before the job was done will be criticized for being a spoil sport and whiner. Of course we won!

So there you have it, the "thinking" behind the Afghanistan Surge. As nearly always the case with Washington, D.C., the non-correlation with reality is just about a perfect 100%. But that's not the business they're in, not anymore. It's the projection of Images of Reality. Those are all that matter, and since there is no chance that a permanent solution to turmoil in Afghanistan and Pakistan will be in place 19 months from now, the Image is all we're going to get.

This I gotta see

(A little while before viewing my President's speech on Afghanistan.)

(Cue music from "Rocky.")

Rahm Emanuel Productions Presents: Surge II: Afghanistan - This Time It's Focused!

This had better be good, after all the promo and build-up. Barack has been pretty dull over the last few months, but then how fascinating can you be when you're talking about health care reform and budget deficits? B-o-o-o-ring. So finally the early winter blockbuster (beating the other studios to the punch during the holiday season) we've all been waiting for to break the monotony of endlessly mind-numbing reports on the GDP, and jobless rates and whether or not we'll have another stimulus, fercryinoutloud.

This is all the stimulus the American people need. War! (what is it good for - dadunhdaDUNH!)

Since the O-Man's capitulation to the guys wearing scrambled eggs on their shoulder boards was always a foregone conclusion - (I mean, c'mon: what was he gonna do? Make someone unhappy?) I only hope he doesn't spend too much time apologizing for agreeing to do what everyone told him to do during those "tense," "grueling," "exhaustive" meetings he's been holding with Biden, Gates, Hillary, Petraeus, McChrystal and even, during the last meeting, the budget director Orszag (always a bad sign when one of the suits from the studio shows up to tell you you're running over budget). Knowing the President as I don't, however, I know he's going to hem and haw a lot as he explains all the codicils and conditions attaching to this escalation.

To wit, it's not "open-ended." It's not a "blank check." There will be "benchmarks" to gauge our progress and the progress of the Afghan government in meeting our benchmarks. Also (and this is the bathetic rationale for choosing West Point for the speech, aside from the zero percent chance of hearing anyone yell out "You lie!" from the audience), he will tell us that the hardest thing a President can do is to order men into harm's way, especially when he has to do it in order to placate Right Wing critics who will otherwise criticize him for being too "soft." (Thus forcing his Right Wing critics to criticize him on one of the 732 other bases they use.) Actually, I think there could be a couple of things harder, such as emulating George Washington and actually putting yourself in harm's way, but that's another matter.

Maybe he'll actually use the phrase "off ramps." (What kind? Cloverleaf? Runaway truck?) I sure hope so, but maybe it's too colloquial. Mostly, "mission," "cost" (especially the lives of our brave young men and women) and some stuff about terrorist bases and the like. We can't allow Afghanistan ever again to be the place chosen by those who would do America harm to "plot and scheme" to attack us. Instead, we've forced Bin Laden and Co. to travel 50 yards east into Pakistan.

I'm starting to see the problem with the Sequel as mass entertainment to get our minds off the fact the country is swirling down the toilet bowl economically. Rahm, I'm sure (since he knows the Biz) also is aware of the problem with this "vehicle." The war's over eight years old, you know? It's like "Seinfeld" got in the last season or so: repetitive, contrived, kind of forced. The magic is gone. The cool part was late fall of 2001, when the Marines were overrunning Kandahar and vindicating the American people. Now it's the last month of 2009 and...the Marines are trying to overrun Kandahar and vindicate the American people.

How much boffo box office does this franchise still have? Does it got legs left at all? Oh well. If any front man can sell it, it's our Prez. Hey look - didn't we buy into him?

Light at the end of the tunnel?

Goldman Sachs recently published a report indicating that the American economy is about 2/3rds of the way through the financial crisis, beginning its analysis with the concession, "bad loans = big losses." The losses so far are about $1.6 trillion, with total losses estimated in the range $2.1 to $2.6 trillion and about 70% of these losses are connected to real estate, one way or another. This estimate is more or less in line with quantitative analysis Nouriel Roubini performed much nearer the outset of the crisis, when he estimated that the total losses from bad loans would be in the neighborhood of $3 trillion.

Of course, that's still a lot of barbecue patios and breakfast nooks. However, I hope GS is right and its many detractors wrong. For example, Zerohedge immediately went on the attack, noting that Goldman had failed to take into account the FASB (accounting) changes (FAS 166-167) that are coming up which will force banks to bring hidden loan losses residing off-balance sheet up onto the deck where they can be seen. I didn't read, however, that Zerohedge and the witty Tyler Durden were really taking into account that Goldman is allowing for nearly a trillion more in recognized losses, which might encompass that delta between where we are (visible) and where we're going, including slimy creatures that might crawl out from under the rocks when 166-67 are operational.

Such prognostications are a severe test, emotionally, for the Selbstschadenfreudeners such as Zero Hedge, Karl Denninger and others. Their stock in trade is financial doom: dollar implosion, sovereign debt default, chaos and murder in the streets. Partly their hidden agenda is the cultivation of their cherished personal beliefs in gold, as in the mineral Au; they reassure themselves that fiat currency regimes always crash, and that gold, which they're flogging and which the Comment Cowboys (h/t: Dan) on their threads buy a lot of, is the only real depository of value. Naturally, this raises questions: can you actually eat the stuff, or burn it to keep warm? (The answers to the same two questions about greenbacks are, (1) Yes, but pointlessly; and (2) Sure, for a little while.) Nouriel Roubini, usually a favorite of the Selbst-essers because he's known as Dr. Doom and successfully predicted the financial crisis about two years in advance [so did I, but did I sell my house? No-o-o-o-o-o-o-o-o-o-o-o.], recently went on their scheisse list because he refused to recommend gold as a hedge.

It is increasingly apparent that Ben Bernanke's basic operating premise is buying time, or as those in the SS say, extend-and-pretend. The Fed itself has essentially become the secondary market for all mortgage-backed securities (MBS) guaranteed by FannieMae and FreddieMac. Its balance sheet, in the course of about a year, went from less than $800 billion to its present $2.2 trillion, and most of the increase is the purchase, by the Fed, of these distressed securities. Bernanke's strategy is to hold these mortgages long enough to give the housing market a chance to reflate, thus putting these instruments back in the money. In the meantime, and as a complement to this approach, the Fed has been hyperactive in the secondary market for Treasuries as a means of holding interest rates down to (a) add a knock-on depressant effect on mortgage rates and (b) keep the vast deficits being run up by the government under control.

The SSers contend that Bernanke's real aim is "to destroy the middle class by destroying the dollar." This is fatuous, of course, as a statement of volition or intention. No, he isn't. Actually, what he's done (whether it works as well as he hopes or not) is borderline brilliant. Semi-smart, as Burt Reynolds might have said in "Semi-Tough." It's the one way out of this bad loan fiasco that doesn't result in massive bank failure (in the 2,000 + range) and further ruination of the housing market.

Zerohedge, The Market Ticker, et alia, need Bernanke to be wrong because that is their stock-in-trade: the day by day prediction of the Apocalypse. Thus, the attribution to Gentle Ben of these nefarious, Dr. Moriarty-like predilections. We're a society now so drenched in class warfare, and so traumatized by the Depression-like miasma hanging over the country, that it's hard to be reasonable anymore. But in fact, if Bernanke succeeds, as difficult as that might be, it redounds to the benefit of every strata of society.