State of the Union

Romney repudiates Reiss, but not on MEK

At the most recent Fox debate Romney distanced himself from one of his former key foreign policy advisors, Mitchell Reiss, by denying that the Taliban should have a stake in peace negotiations in Afghanistan. “We should not negotiate with the Taliban,” he said, “we should defeat the Taliban.” Since the Afghan security forces would be unlikely to defeat them on their own, Romney is effectively endorsing the long-term deployment of troops in Afghanistan to defeat an enemy that is (or some of its factions are, at least) seeking a peace settlement.

For what it’s worth, the Karzai government supports the Taliban office’s opening in Qatar, and recognizes that any settlement will have to include them. On his blog at Foreign Policy, Reiss offered a rational, qualified endorsement of the negotiations between the U.S. and the Taliban:

The United States still needs to determine: (1) whether the Taliban officials sitting across the negotiating table represent themselves, a small faction, or a broader constituency, (2) whether they have the authority to impose any agreement on the mujahedeen in the field, and (3) whether they have a genuine interest in a permanent halt to the conflict on terms that are agreeable to the United States and its Afghan partner (e.g., renouncing ties to al Qaeda, laying down their weapons and supporting the Afghan constitution).

Ben Smith points to Romney’s remarks and his recent endorsement by John Bolton as evidence of Romney’s shift from the “GOP’s Condoleezza Rice wing to its Dick Cheney wing.” He continues:

… people familiar with Romney’s circle of foreign policy advisers said [Reiss] has for months been a target from other, more conservative advisers — from Senor to allies of Bolton — who saw him as a bit soft on key issues of national defense.

It was, though, an attack from the left that led to Reiss’s quiet demotion from first among equals in 2008 to the status of one of many advisers this time: Salon reported that he had spoken out in support of the MEK, an anti-regime Iranian group viewed with suspicion by many but seen by some on the right as a valuable ally against Tehran. And while some of Romney’s other advisers might share his sympathies, his public speaking on behalf of the group represented an unacceptable breach of discipline for Romney’s tight inner circle.

First of all, it speaks volumes about the neoconservative policy elite that a person willing to work with a Islamist-collectivist cult known to have killed Americans for the purpose of destabilizing a foreign government is found to be “a bit soft.”

Significantly, back-benching Reiss isn’t a repudiation of the idea of U.S. cooperating with the MEK; at least two other advisors have advocated de-listing the group though Reiss has been the most vocal. Romney himself may have obliquely referred to the group at a debate appearance on November 12th when he said the United States should begin “working with” and “support[ing] insurgents within the country.” The presidential frontrunner has yet to explain which insurgents he’s talking about but there aren’t that many Iranian insurgent groups and the connection seems undeniable. So, to clarify, Romney is against negotiating with a quasi-governmental entity to end a 10-year war but in favor of working with terrorists to start a new one.

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More Bad News From Europe

There has been more bad news out of Europe today. On top of the downgrades of several eurozone countries and the EFSF bailout fund, Germany today announced that it has lowered its growth forecasts for 2012 from 1% to 0.7%. Throughout the euro crisis Germany has been central to the bailouts of struggling countries, contributing a huge amount to the recently downgraded EFSF. Economic recovery in Europe is not possible without an economically stable and strong Germany. While this would be very worrying in isolation, the World Bank today announced that it has cut global economic growth forecast from 3.6% for both 2012 and 2013, to 2.5% in 2012 and 3.1% in 2013. While there is some hope of a more relaxed monetary policy for Europe in the future, this is only because of China’s slow economic growth, something that should not be welcomed in the long term.

While there are serious economic concerns in Europe the continent is also facing domestic political upheaval. The unelected Greek government is failing to implement needed austerity measures, Italy’s technocratic government is making too few changes too late, and the patience of the German people is being tried. There is only so long that Germans will put up with contributing to the clean up of their neighbor’s mess, and we could soon see domestic German politics reflect this growing attitude.

While the continual downgrade of European countries and the slowing growth of China are out of the responsibility or remit of any American politician, the GOP should take note. The sovereign debt crisis in Europe is our future if serious measures are not taken to adapt an aggressive and serious fiscal policy that tackles spending and government growth. Unfortunately the only candidate who understands the severity of the situation and is advocating such measures is alienated by the GOP because of his pro-peace, pro-trade and pro-diplomacy foreign policy.

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Are Intellectual Property Rights Bad for Innovation?

The moral claim for intellectual property – that an inventor has the exclusive right to the application of a certain idea in the form of a monopoly granted by the state – has long been on shaky ground. Reductio ad absurdum, where would the monopoly stop? When the inventor dies? 70 years afterward, as current copyright law is structured? In perpetuity? Starting from the premise that ideas are non-rivalrous – as Thomas Jefferson put it in 1813, “he who receives an idea from me, receives instruction himself without lessening mine” - Sheldon Richman takes aim at the utilitarian argument for intellectual property protection, the notion that it encourages innovation, in a piece posted today.

He writes, “the implied cost-benefit analysis is a sham. Defenders tout IP’s hypothesized benefits while presuming the costs are virtually zero. Ignored are the costs in innovation never ventured for fear of legal reprisal, in resources consumed during litigation, in talent diverted to protecting IP rather than producing useful goods, and so on.”

Rather, innovation in a free market is dependent on the ability – within reason – to imitate competitors because innovation usually occurs in small steps. Richman puts it beautifully, “copying combined with product differentiation equals rising living standards.” The alternative is artificial scarcity induced by a government-enforced monopoly, which leads to higher prices and less innovation.

In today’s dynamic market with falling production costs and increased fear of competition, a firm depends more and more on its intellectual property rights. Enter patent trolling, copyright litigation used as a scare tactic against file sharers, and new legislative attempts to protect IP holders.

On a very related note, anyone who uses Wikipedia, Google or hundreds of other sites are finding their pages darkened today in a blackout protest against pending copyright legislation in both houses of Congress. SOPA and PIPA haven’t been brought up for a floor vote yet, but net activists are making their concerns known, as is the Heritage Foundation’s lobbying arm, which promises to list the vote on congressmen’s legislative scorecards. Support for the bills comes largely from the music industry, Hollywood and the Chamber of Commerce.

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The American Conservative Welcomes Noah Millman

I’ve admired Noah’s writing at The American Scene and elsewhere for some time, and now I’m delighted to announce that he’s joined us as a blogger. Check out his self-introduction, as well as his provocative first posts: on whether the Fed, the mortgage mess, and Wall Street really caused the recession — indeed, Noah reverses the Austrian line and asks of whether bursting bubbles aren’t worth the lower unemployment that inflationary monetary policy brings — and on making shibboleths of Ron Paul and Martin Luther King.

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An Un-Compassionate View of Ron Paul

New York Times resident compassionate conservative David Brooks can be quite clever in how he creates mental linkages for his audience.  His recent article on his travels observing the candidates in the South Carolina takes no prisoners when it comes to Ron Paul.  He reports speaking to “a pawnshop manager who supports Ron Paul and said he has clients who buy a new gun every time the government does something they don’t like.”  Two unrelated observations are linked to demonstrate that Ron Paul is supported by “gun nuts.”

He then goes on to assert that “Ron Paul’s supporters are so grateful. The world was once confusing, but then they read ‘End the Fed’ and the scales fell from their eyes. Paul himself is fascinating because as some smart person observed (I’ve forgotten who), he thinks serially, not causally. The income tax happened and the Patriot Act happened and the Federal Reserve chairman, Ben Bernanke, bailed out the banks and job growth stinks. Paul doesn’t bother with logical links. He just strings events together and assumes causation.”

The straw man “smart person” is no doubt Brooks himself and he makes a claim that is unsupportable.  I doubt if Brooks actually has stopped to listen to Paul very often.  Paul does frequently present facts serially when he speaks, but they are generally connected, as when he is discussing the economy or foreign policy.

The Brooks contrivance is to make Paul appear to be a candidate supported by kooks and the unenlightened whose own thoughts are disordered and illogical.  Paul is in fact supported by many who are tired of the Washington status quo, of which Brooks is a component.   Many Paulistas are both articulate and well informed on the issues, certainly more so than most of the followers of the other candidates.  Paul himself presents a consistent and coherent philosophy of government and foreign policy that is anathema to Brooks, so it is not surprising that he tries to marginalize him.

 

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Neither Marx Nor Ayn Rand

“They’re vultures that are sitting out there on the tree limb, waiting for a company to get sick, and then they swoop in … eat the carcass … and … leave the skeleton.”

So Rick Perry colorfully characterized the private equity firm Bain Capital, once run by Mitt Romney.

How did Bain prosper? Says Perry:

“These companies … come in and loot the people’s jobs, loot their pensions (and) loot their ability to take care of their families.”

Behind this depiction is a 28-minute documentary, “King of Bain,” being aired in South Carolina by a super political action committee that supports Newt Gingrich and is financed by Vegas-Macau casino billionaire Sheldon Adelson.

The truth, however, turns out to be less colorful, as The Washington Post has awarded the documentary four Pinocchios for “manipulative interviews” and a “highly misleading portrayal of Romney’s years at Bain Capital.”

Seems that two of the companies Bain allegedly looted were not acquired until after Mitt left the firm, and the closure of a third plant in Gaffney, S.C., was no communal disaster.

No one in Gaffney, writes The New York Times, seems to recall the company, and the local paper did not even report its demise.

“King of Bain” is a hit piece, a malicious libel full of so many errors and lies that even Newt said it must be corrected or pulled down.

Yet if Romney is nominated, we will see this avenue of attack pursued by the Democrats. For populist assaults on capitalists and capitalism, dating back to William Jennings Bryan’s “Cross of Gold” speech to the 1896 Democratic National Convention, have a long and venerable history.

Moreover, the hysteria of Beltway Republicans and their Chamber of Commerce allies over the Newt-Perry attacks on Mitt “the predator” and Mitt “the vulture capitalist” testifies to the power of the narrative and Republicans’ fear of it. And they would do well to be fearful.

To many Americans, the period from the Civil War to World War I, when U.S. production grew from half of what Britain produced to twice what Britain produced, was a legendary era of growth and prosperity.

To others, however, this was the Gilded Age of Jim Fisk and James Gould, of robber barons and the Pullman strike, of the Haymarket Massacre and the Homestead strike at Carnegie Steel, where armed Pinkertons came up the river in barges to break the strike, only to be shot, disarmed and beaten by strikers and their families. Read More…

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Defending corpse urination begs the question: who’s the racist?

For years the writers, editors and readers of The American Conservative have had to endure the undeserving charge that its paleo-conservative-libertarian roots are racist. I’ll never forget the former Washington Times writer who told me to my face, quite smugly as we were sharing a cab during the 2008 Republican National Convention, that I write for a racist rag.

In part, these charges are old, lobbed and maintained by founding editor Pat Buchanan’s more adamant longtime detractors. But the slander endures, most vociferously it would seem, by unreconstructed liberals who never read the magazine and neoconservatives like my arrogant cabmate, who especially abhor the magazine’s founding manifesto:  that the Bush Administration’s war policy was a mistake, and that the political and tactical reaction to 9/11 was and is not only stunningly wrongheaded, but dangerous and motivated by venal special interests that hew not to the U.S constitution nor to the morals and values of an American republic.

Couldn’t one as easily say their own advocacy of endless war against “brown people” in the Middle East and Central Asia – not to mention North and East Africa – is racism on a Global scale? Writers at The Weekly Standard, National Review, The Washington Times and Commentary have been ruthless non-apologists for the indiscriminate killing of non-whites as a means to their ends, from the “shock and awe” invasion of Iraq and the flattening of Fallujah to the ethnic cleansing of Baghdad, today’s drone strikes in Afghanistan, Pakistan and Yemen, and all of the wars’ human repercussions (death, disease, displacement). In their world, these are always treated as time-wasting, politically motivated afterthoughts that merely muddy their own paper-white narrative.

On a micro-level, how can calling what happened at Abu Ghraib (dragging Arab men by leashes, stacking them up naked in a pyramid, beating and turning dogs loose on them) “a small prison scandal” over which the American public got unduly “hysterical,” not be considered racist in some way? Those were among the many remarks Weekly Standard editor Bill Kristol made on the air and in writing that urged Americans to recalibrate their outrage downward in the wake of the 2004 revelations.

His cohort at Commentary, Norman Podhoretz, agreed,  downplaying what happened at Abu Ghraib while making it a political issue, accusing the Democrats of going off  “the intellectual and moral rails as to compare the harassment and humiliation of the prisoners in Abu Ghraib—none of whom, so far as anyone then knew, was even maimed, let alone killed—to the horrendous torturing and murdering that had gone on in that same prison under Saddam Hussein or, even more outlandishly, to the Soviet gulag in which many millions of prisoners died.”

Now, Kristol, in an effort, again, to downplay what many are already calling a war crime, has declared U.S Marines urinating on (desecrating) Afghan corpses part of an American military tradition.

But it’s also worth noting that pissing has a distinguished place in American military history. Most famously, General George S. Patton relieved himself in the Rhine on March 24, 1945—and made sure he was photographed doing so. …

It wasn’t just American generals who seemed preoccupied with pissing back in 1945. Three weeks earlier, Winston Churchill had visited the front lines near Jülich. Churchill had long dreamed of urinating on Hitler’s much-vaunted Siegfried Line to show his contempt for Hitler and Nazism…

So perhaps, as Rep. Allen West, once a battalion commander in Iraq, put it last week, all the sanctimonious Obama administration bigwigs “need to chill.” Did Defense Secretary Leon E. Panetta really need to speak up at all?

Does Kristol realize he is comparing dead men to a river or a territorial boundary, suggesting these corpses were never human at all?

Kristol and his ilk don’t think much of the Geneva Conventions, so it is almost not worth the breath to remind them that desecrating corpses is in violation of international treaty, but it is also against military law, which means the Marines already recognize such desecration is not heroic, funny, eye-for-an-eye, nor proof of battlefield supremacy. It’s wrong.

Funny how even suggesting such behavior was happening in World War II or even Vietnam is taboo, but today Kristol and his more deranged ideological offspring like Pamela Geller of the popular Atlas Shrugs website, now appear to be cheering it on, even questioning the loyalty and politics of those who don’t.

“I love these Marines,” wrote Geller after the story broke last week. “Perhaps this is the infidel interpretation of the Islamic ritual of washing and preparing the body for burial.”

What a hoot! Even scarier are the comments, some of which suggest that if al Qaeda wants to field an army of bloodthirsty psychos, beheading and dismembering their enemies and desecrating the dead, then our Marines have every right to do it too. Read More…

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Six Top GOP Sens Discover How the Internet Works

Perhaps out of fear of a grassroots insurrection, six conservative senators sent a letter to Harry Reid today expressing a newfound concern about the PROTECT IP Act.

Via Lachlan Markay at The Foundry:

Sens. Chuck Grassley (R-IA), John Cornyn (R-TX), Orrin Hatch (R-UT), Jeff Sessions (R-AL), Mike Lee (R-UT), and Tom Coburn (R-OK), sent a letter to Senate Majority Leader Harry Reid (D-NV) on Friday expressing their concerns.

The letter, whose signatories include the ranking Republicans on the Budget, Finance, and Judiciary Committees, warns of “breaches in cybersecurity, damaging the integrity of the Internet, costly and burdensome litigation, and dilution of First Amendment rights” could result from passage of the hotly-contested PROTECT IP Act.

Still, the Senators didn’t go so far as to actually condemn the legislation, they just say it deserves further scrutiny. They do, however, explicitly mention the “large number of constituents and other stakeholders with vocal concerns about the potential unintended consequences of the proposed legislation.”

Sens. Rand Paul and Jerry Moran have voiced opposition to the bill in the past, but these six heavyweights voicing their reservations represents a horse of another color. The floor debate on this one should be really interesting (it comes up on Jan. 24th, for the C-SPAN crowd), and there’s definitely a conservative case to be made against the bill – it could force companies to stop doing business without due process, it’s anti-competitive and blatantly violates free speech. But opposition to the bill isn’t just principled, it’s also good politics – grassroots opponents to SOPA and PROTECT IP are proving to be numerous and extremely vocal, especially among the Tea Party. Not only that, but with all the Hollywood money being funneled into the Democratic Party, Harry Reid can’t afford to look less than solicitous of their interests.

As Matt Lewis noted today, important philosophical battles are going on on the right today, especially compared to the left.

While Democrats are essentially falling lockstep behind President Obama, Republicans are engaging in some very important philosophical debates. For example, the rise of Ron Paul demonstrates that the GOP includes both hawks and a large number of non-interventionists. The schism over Bain Capital demonstrates the cleavage between the big business wing of the Republican Party and the more populist conservative strain.

I suppose the SOPA/PROTECT IP debate falls roughly within the latter. But in this case the populist conservatives are aligned with some of the biggest and most innovative tech companies including Google, Facebook and Twitter. Passing SOPA wouldn’t be a victory for free markets, it would be a victory for the narrow special interests that pushed for it.

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Standards and Poor’s Losing Faith in Europe

Today France confirmed that the ratings agency Standard and Poor’s has downgraded its rating from AAA to AA+, while Germany and the Netherlands have reportedly escaped downgrades. It is rumored that a total of up to eleven countries face downgrade.

Rumors earlier today prompted a fall in world stock markets with the FTSE 100 down 0.5% and the Dow Jones down 0.8%. This fall in the markets is a clear indication of the severity of the eurocrisis, and how little confidence the markets have in the euro’s integrity and the measures taken by European governments to manage the debt crisis.

The last few months and years have seen desperate attempts by European nations to contain the European debt crisis. While the European Financial Stability Facility, a fund reserved for sovereign debt recovery, is guaranteed by eurozone countries, a downgrade across some of the eurozone nations will make it more difficult for some countries to raise money. Not only will private enterprise struggle, but government will find it harder to collect revenue. At the end of last year, a summit of European leaders failed to unite the continent behind a recovery plan, with the UK using its veto on the proposed treaty.

The euro crisis is getting worse the longer it lingers on. European politicians are not yet ready to admit that the euro, which was always a political rather than economic experiment, has been a failure. The admission of countries like Greece, which had huge levels of government spending, was a mistake for which Europe is now paying a very heavy price.

Unfortunately it is the millions of Europeans that will pay this price for the politically motivated and moronic economic policies of the last few decades, and not the politicians who implemented them. Too many mistakes have been made in the efforts to manage the debt crisis to make recovery manageable, and today’s news is an indication of things to come.

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Wonder Bread: Hostess Taps Bankruptcy Loan, Union Problems Sno-Ball

Dow Jones reports that a federal bankruptcy judge gave the go-ahead for Hostess to begin tapping a $75 million loan to keep the company above water while during bankruptcy proceedings.

Some attribute Hostess’ troubles to healthier eating habits among Americans, the USA Today article on their filing states:

Hostess has enough cash to keep stores stocked with its Ding Dongs, Ho Hos and other snacks for now. But longer term, the 87-year-old company has a bigger problem: health-conscious Americans favor yogurt and energy bars over the dessert cakes and white bread they devoured 30 years ago.

Last year, 36% of Americans ate white bread in their homes, down from 54% in 2000, according to NPD Group. Meanwhile, about 54% ate wheat bread, up from 43% in 2000.

That explanation sparked some discussion from Reason’s Nick Gillespie, who writes:

I’m not sure I’m buying that argument in its totality, but there’s no question that sliced white bread, especially Wonder Bread, went from being the staff of life for upward-striving post-War middle-classers to being a cultural touchstone for all that was bad and wrong with America. Whether we’re buying less of the stuff – or feel less in need of the myriad ways it supposedly enriches our bodies – I don’t know. But there seems less a role for white bread in a world where even the Olive Garden is pushing rustic loaves of yeast and flour.

Big Government’s Dana Loesch was skeptical, observing that the USA Today article buried facts about Hostess’ union problems and rising ingredient costs deep in the article.

 It’s not difficult to sell creme-filled heaven snacks and America isn’t exactly eating healthier. If anything, America is eating leaner because the price of everything has increased eleventy-fold because the cost of energy is passed to us, the consumers.

…Hostess, a privately held company based in Irving, Texas, has outstanding debts of more than $860 million and owes over $50 million to vendors, an economic situation that sources attribute to rising prices for sugar, flour and other ingredients and higher labor costs which the company’s approximately $2.5 billion in annual sales have not been able to cover.

Additionally, Hostess employees are unionized while most of its competitors aren’t. As a result, Hostess has high pension and medical benefit costs.

While the broader trend Gillespie observes is certainly true – Trader Joe’s anyone? – it’s also true that during recessions, people adjust their purchasing habits. The stock price of McDonalds, for instance, has doubled since late 2007. Based on today’s report, it appears Loesch is right. If an agreement with the unions isn’t reached in 75 days, the terms of the loan state that Hostess could begin selling off its assets.

Also, apparently during the earlier negotiations the international parent union was representing the local chapters, which they aren’t authorized to do:

In perhaps the hearing’s most dramatic moment, Hostess President and Chief Executive Brian Driscoll took the witness stand and told a lawyer for the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, or BCTGM, that he was unaware that during recent labor negotiations, the international parent union wasn’t actually authorized to negotiate on behalf of the local unions.

“Who were you negotiating for?” Driscoll asked the union’s lawyer, Bredhoff & Kaiser PLLC’s Jeffrey Freund.

“I’m asking the questions,” Freund responded.

“I would like my $900,000 back,” Driscoll said, referring to the amount of money Hostess has paid to its professionals negotiating with the unions. While Driscoll’s response elicited laughter from nearly everyone in the courtroom but himself, the back-and-forth is a clear precursor to a tough fight between Hostess and the union both in and out of the courtroom.

It’s hard out there for a snack food company, and these hamfisted union negotiations certainly don’t help. Hostess is more or less the last independent publicly-traded purveyor of snack foods with names most people have heard of. Almost all of the brands that filled the school lunchboxes of American children for decades have experienced major upheavals in the last quarter-century. The venerable Keebler (est. 1853) is in the hands of Kellogg as of 2001.  Nabisco has been passed around like an, erm, Ho Ho since its merger with RJ Reynolds in 1985, and will presumably be a part of the snack-food company resulting from Kraft Foods’ planned split.

For a company like Hostess with a less diversified line of products, it’s a lot harder compensate for the cost of something like this, too.

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