Can Ronald Reagan, Margaret Thatcher, and Milton Friedman turn back the jihadist tide?
Well, in my interview today with Secretary of State Condoleeza Rice, Ms. Rice indicated that economic and free trade diplomacy is essential in the global terror war. It may not work in some places she told me, but capitalist free trade and investment remains a very important part of the story.
She herself is working closely with new Treasury Secretary Henry Paulson—especially on China.
Ms. Rice said that spreading freedom, democracy and liberty around the world as per President Bush’s January 2005 Inaugural Speech is the backbone of her diplomacy. She agrees that un-free countries will benefit, but most importantly, so will United States security.
***To see the full interview, tune into Kudlow & Company this evening on CNBC at 5pm EST.***
Tuesday, October 31, 2006
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.Tonight's show will be live from Washington and will center around the interview we did today with Secretary of State Condoleeza Rice.
We'll begin with a discussion of North Korea's agreement to return to talks with China, the United States, and other countries on their nuclear weapons program.
Our Washington to Wall Street panel of experts includes:
* John Rutledge, chairman and CEO of Rutledge Capital
* P.J. Crowley, former special assistant for national security affairs
* Jed Babbin, former deputy undersecretary of defense
* Jared Bernstein, senior economist at the Economic Policy Institute
Our panel will dive into a debate on the role of investment, trade, protectionism, and economic freedom in today's world.
Rangel Calls Cheney a S.O.B. Following Our Interview
Apparently, Rep. Charlie Rangel (D-NY) was none too pleased with what Vice President Cheney told me during our interview yesterday on Kudlow & Company.
According to the front page of today's New York Post, Rangel took umbrage with Cheney's assertion that Mr. Rangel was a committed tax hiker who would not hesitate to raise taxes.
Here's what Mr. Cheney told me:
"If Charlie Rangel ends up as chairman of the Ways and Means Committee, he's said as much, that he doesn't believe there's a single one of the Bush tax cuts that ought to be extended. And I think that would be bad for the economy. I don't know if the stock market would like it. I don't think they would...So if a man like Charlie Rangel were to be chairman of the committee, and sitting there with the gavel, all he has to do is not act, just don't call up the legislation, and there'll be a big tax increase."
Here's what Rangel told the NY Post:
"He's such a real son of a bitch, he just enjoys a confrontation," Rangel fumed, describing himself as "warm and personable." Rangel said Cheney may need to go to "rehab" for "whatever personality deficit he may have suffered."
Click here to read the whole story.
According to the front page of today's New York Post, Rangel took umbrage with Cheney's assertion that Mr. Rangel was a committed tax hiker who would not hesitate to raise taxes.
Here's what Mr. Cheney told me:
"If Charlie Rangel ends up as chairman of the Ways and Means Committee, he's said as much, that he doesn't believe there's a single one of the Bush tax cuts that ought to be extended. And I think that would be bad for the economy. I don't know if the stock market would like it. I don't think they would...So if a man like Charlie Rangel were to be chairman of the committee, and sitting there with the gavel, all he has to do is not act, just don't call up the legislation, and there'll be a big tax increase."
Here's what Rangel told the NY Post:
"He's such a real son of a bitch, he just enjoys a confrontation," Rangel fumed, describing himself as "warm and personable." Rangel said Cheney may need to go to "rehab" for "whatever personality deficit he may have suffered."
Click here to read the whole story.
Secretary of State Rice on Kudlow & Company Tonight
This is my last day in Washington before heading back up to New York.
We’re going to interview Secretary of State Condoleeza Rice on tonight’ show. I plan on asking her about the ongoing challenges in Iraq as well as the danger of nuclear proliferation in Iran and North Korea.
Another topic I’d like to explore is how the global economy—in its march toward capitalism—has performed brilliantly since the horrible attacks on 9/11. Global stock markets have also performed exceptionally well.
So, is it possible that economic freedom is trumping totalitarian, jihadist, Islamic fundamentalism?
And is there a way to use economic connectivity in solving international political hotspot challenges in the darker corners of the world?
We’re going to interview Secretary of State Condoleeza Rice on tonight’ show. I plan on asking her about the ongoing challenges in Iraq as well as the danger of nuclear proliferation in Iran and North Korea.
Another topic I’d like to explore is how the global economy—in its march toward capitalism—has performed brilliantly since the horrible attacks on 9/11. Global stock markets have also performed exceptionally well.
So, is it possible that economic freedom is trumping totalitarian, jihadist, Islamic fundamentalism?
And is there a way to use economic connectivity in solving international political hotspot challenges in the darker corners of the world?
Liberal Bias?
You'll have to dig a bit to find this story in today's USA Today (it's on page 6 of the life section)
Drudge gave it top billing...
Heavy coverage at midterm favors Democrats, study says
Drudge gave it top billing...
Heavy coverage at midterm favors Democrats, study says
Monday, October 30, 2006
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening. The centerpiece of this evening's program will be our interview today with Vice President Cheney.
We have lined up an all-star Washington to Wall Street panel to offer its perspective on the wide range of subjects covered during the interview.
We'll cover the stock market and economy, Iraq, the upcoming elections, and much, much more. Our economic panel on tonight's program:
* Elizabeth MacDonald, Forbes magazine senior editor
* Gary Gensler, former Treasury undersecretary
* Don Luskin, Chief Investment Officer for Trend Macrolytics
* Jim Glassman, American Enterprise Institute fellow and host of Tech Central Station
Our political panel:
* Peter Beinart, editor-at-large at The New Republic
* Tony Blankley, Washington Times editorial page editor
* Frank Newport, editor-in-chief of the Gallup Poll
It's your money and your vote ladies and gentlemen - eight days left in the election countdown...
Cheney Interview
I’m down in D.C. where I just finished my interview with Vice President Cheney. We’ll air the entire interview on CNBC’s Kudlow & Company this evening.
A few highlights:
I mentioned that stocks have been going up while GOP polls have been going down, and whether the market was signaling it wants a divided government after 6 years of GOP rule. Cheney doesn’t think so. He talked about how Republicans passed the investor tax cuts - and how this has boosted the U.S. stock market and economy, and reignited growth
We discussed Charlie Rangel telling CNN this weekend that he didn’t want to raise taxes and how Nancy Pelosi told me in our interview last week that she wants tax hikes as a last resort. Despite all this, he still believes they’re tax hike threats.
Mr. Cheney took the no new tax hike pledge and although he can’t speak for the President, he believes he would veto any potential tax hike bill.
On the midterms, the Vice President was still very much optimistic for a GOP victory on November 7th.
With respect to backdating stock options: he’s concerned about this, but he’s not in favor of additional regulation on hedge funds and private equity funds. He also said he’s willing to work with Pelosi on easing the overreglation of Sarbanes-Oxley.
He was not hopeful of capturing al-Sadr whose death squad militias are causing sectarian strife throughout Iraq. Nor was he hopeful about a “big victory” event that would give hope to people like myself who want to win the war. I mentioned Vicksburg and The Battle of Midway and he basically said this isn’t that kind of war.
Tune in to the show tonight to catch the whole interview…
A few highlights:
I mentioned that stocks have been going up while GOP polls have been going down, and whether the market was signaling it wants a divided government after 6 years of GOP rule. Cheney doesn’t think so. He talked about how Republicans passed the investor tax cuts - and how this has boosted the U.S. stock market and economy, and reignited growth
We discussed Charlie Rangel telling CNN this weekend that he didn’t want to raise taxes and how Nancy Pelosi told me in our interview last week that she wants tax hikes as a last resort. Despite all this, he still believes they’re tax hike threats.
Mr. Cheney took the no new tax hike pledge and although he can’t speak for the President, he believes he would veto any potential tax hike bill.
On the midterms, the Vice President was still very much optimistic for a GOP victory on November 7th.
With respect to backdating stock options: he’s concerned about this, but he’s not in favor of additional regulation on hedge funds and private equity funds. He also said he’s willing to work with Pelosi on easing the overreglation of Sarbanes-Oxley.
He was not hopeful of capturing al-Sadr whose death squad militias are causing sectarian strife throughout Iraq. Nor was he hopeful about a “big victory” event that would give hope to people like myself who want to win the war. I mentioned Vicksburg and The Battle of Midway and he basically said this isn’t that kind of war.
Tune in to the show tonight to catch the whole interview…
CAIR Bets on Dems
From FrontPageMagazine:
With two weeks left before the November 7th election, speculation abounds about the shape of politics in Washington D.C. for the next two years. Many political commentators are expressing the view that America is about to return to the days of divided government – with a Republican in the White House and Democrats holding at least one, if not two, chambers of Congress. From all indications, America, it seems, is very evenly divided.
But for officials of the Council on American-Islamic Relations (CAIR) – the most visible group claiming to represent Muslims in America – their political loyalties appear to lean in one particular political direction. An extensive review of political contributions by CAIR officials, employees and board members on the local, state and national level reveals that CAIR is betting almost exclusively on Democrats to represent them politically on Capitol Hill during the upcoming 110th Congress...
With two weeks left before the November 7th election, speculation abounds about the shape of politics in Washington D.C. for the next two years. Many political commentators are expressing the view that America is about to return to the days of divided government – with a Republican in the White House and Democrats holding at least one, if not two, chambers of Congress. From all indications, America, it seems, is very evenly divided.
But for officials of the Council on American-Islamic Relations (CAIR) – the most visible group claiming to represent Muslims in America – their political loyalties appear to lean in one particular political direction. An extensive review of political contributions by CAIR officials, employees and board members on the local, state and national level reveals that CAIR is betting almost exclusively on Democrats to represent them politically on Capitol Hill during the upcoming 110th Congress...
Interview with Vice President Cheney Tonight
KUDLOW & COMPANY UPDATE:I'll be doing a one-on-one interview with Vice President Cheney today and a one-on-one interview with Secretary of State Rice tomorrow.
Both shows will be live from Washington...
Friday, October 27, 2006
Ka-boom in VA
Judging by the action over at Tradesports, Democrat Jim Webb's heated battle in Virginia against incumbent George Allen has taken a serious turn for the worse since news broke of sexually questionable excerpts throughout Webb's novels.
As of this post:
***George Allen's contract is up a whopping 15 points. Bettors are now giving him a 75 percent chance of victory in that contest.
***Webb's contract is heading to the basement. It has plummeted 15 points, with bettors offering the beleagured candidate a 25 percent shot at the Senate seat.
As of this post:
***George Allen's contract is up a whopping 15 points. Bettors are now giving him a 75 percent chance of victory in that contest.
***Webb's contract is heading to the basement. It has plummeted 15 points, with bettors offering the beleagured candidate a 25 percent shot at the Senate seat.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We will begin tonight's show with a thorough economic discussion focusing on today's GDP report and what it means for the economy, the stock market, and the upcoming elections.
On board to discuss:
* Nouriel Roubini, Professor of economics at NYU's Stern School of Business
* David Malpass, Bear Stearns’ Chief Economist
* Arthur Laffer, Founder and CEO of Laffer Associates
* Craig Columbus, Chief market strategist, Thomson Financial
Kudlow's Stock Club: Alexander Motola, five-star Morningstar rated portfolio manager of the Thornburg Core Growth Fund will deliver his stock picks.
We're also going to dive headfirst into all the latest political news - including Jim Webb's campaign woes in Virginia, the heated Senate race in New Jersey between Kean and Menendez, and the latest on the border fence.
Our political guests include:
* Mark Plotkin, Washington Post Radio host. (Plotkin interviewed Virginia Democratic Senate candidate Jim Webb this morning on the controversy surrounding sexually questionable excerpts from Webb's novels.)
* Bill Press, Democratic strategist and political commentator
* Terry Jeffrey, editor of Human Events
* Myrna Blyth, long-time editor of Ladies Home Journal and founding editor of More
* Lanny Davis, author and White House special counsel in the Clinton administration
Be sure to tune into CNBC's Kudlow & Company this evening for all the latest Washington to Wall Street commentary...
Cesar Conda on today's GDP report:
Democrats and the mainstream media will no doubt say this is firm evidence that President Bush’s tax-cutting policies are starting to fail and that it’s time for a new policy direction. Critics also might blame the Federal Reserve for waiting too long to end its cycle of interest-rate hikes.
But these criticisms will be wrong: The ongoing economic expansion is a direct result of the sound fiscal and monetary policies of the past six years, while the current slower pace of economic growth appears to be cyclical and temporary in nature.
...A GDP report for one quarter is simply one quarter’s worth of data. A broad range of indicators over a longer time period provides a much more accurate picture of our economy: To wit, the U.S. economy grew 3.5 percent across the four quarters preceding the latest GDP data, the fastest pace among industrialized nations. Productivity has expanded at a strong 2.5 percent over this period, well ahead of the average productivity growth rate of the 1970s, 1980s, and 1990s. The economy has created 1.8 million new jobs over the past year and 6.6 million jobs since August 2003 — more jobs than were created in Japan and the European Union combined during this period. And the current unemployment rate of 4.6 percent sits below the average for each of the past four decades.
Democrats and the mainstream media will no doubt say this is firm evidence that President Bush’s tax-cutting policies are starting to fail and that it’s time for a new policy direction. Critics also might blame the Federal Reserve for waiting too long to end its cycle of interest-rate hikes.
But these criticisms will be wrong: The ongoing economic expansion is a direct result of the sound fiscal and monetary policies of the past six years, while the current slower pace of economic growth appears to be cyclical and temporary in nature.
...A GDP report for one quarter is simply one quarter’s worth of data. A broad range of indicators over a longer time period provides a much more accurate picture of our economy: To wit, the U.S. economy grew 3.5 percent across the four quarters preceding the latest GDP data, the fastest pace among industrialized nations. Productivity has expanded at a strong 2.5 percent over this period, well ahead of the average productivity growth rate of the 1970s, 1980s, and 1990s. The economy has created 1.8 million new jobs over the past year and 6.6 million jobs since August 2003 — more jobs than were created in Japan and the European Union combined during this period. And the current unemployment rate of 4.6 percent sits below the average for each of the past four decades.
Thursday, October 26, 2006
Democratic Move to the Center?
I'm seeing a big shift taking place right now in the in the innards - in the middle ground - of the Democratic caucus. This has been one of my mantras for several weeks now.
As Larry Sabato pointed out on tonight's show, there's somewhere north of twenty moderate to conservative Democrats poised to be elected to this new Congress. This crew is pro-business, pro-life on abortion, supported by the NRA and so forth.
Get this: Over thirty of the Democratic candidates for the House are conservative enough to have been green-lighted by the Blue Dogs or the centrist Democratic Leadership Council.
This remarkable shift has been flying largely underneath the radar screen of most of the press.
The Los Angeles Times caught on to this shift and ran a piece on this very subject this morning.
From today's paper:
He is pro-business and antiabortion. He is an evangelical Christian and an avid hunter. But, unexpectedly, Heath Shuler is a Democrat, and he is running for Congress in North Carolina.
Shuler is part of a phalanx of unusually conservative Democratic candidates who may deliver crucial victories over GOP incumbents and help their party win control of the House....
Of course, if the Democrats win control of the House, the old liberal guard will run the important committees. But underneath the rusty, old guard appears to be an increasingly conservative bunch of Democrats.
This is a very good thing for the American people.
As Larry Sabato pointed out on tonight's show, there's somewhere north of twenty moderate to conservative Democrats poised to be elected to this new Congress. This crew is pro-business, pro-life on abortion, supported by the NRA and so forth.
Get this: Over thirty of the Democratic candidates for the House are conservative enough to have been green-lighted by the Blue Dogs or the centrist Democratic Leadership Council.
This remarkable shift has been flying largely underneath the radar screen of most of the press.
The Los Angeles Times caught on to this shift and ran a piece on this very subject this morning.
From today's paper:
He is pro-business and antiabortion. He is an evangelical Christian and an avid hunter. But, unexpectedly, Heath Shuler is a Democrat, and he is running for Congress in North Carolina.
Shuler is part of a phalanx of unusually conservative Democratic candidates who may deliver crucial victories over GOP incumbents and help their party win control of the House....
Of course, if the Democrats win control of the House, the old liberal guard will run the important committees. But underneath the rusty, old guard appears to be an increasingly conservative bunch of Democrats.
This is a very good thing for the American people.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll begin tonight's show with a look at the stock market and economy. Our market guests this evening:
* Brian Wesbury, chief economist at First Trust Advisors
* Russ Koesterich, portfolio manager at Barclays Global Investors
* Robert Shiller, Professor of Economics at Yale University and author of Irrational Exuberance
Congressman Harold Ford (D-TN), who's running a heated race against Bob Corker in The Volunteer State, will discuss all the latest in his election battle. (Make sure to check out today's front-page WSJ article on Mr. Ford and the changing Southern political landscape.)
Our political panel will weigh in on variety of topics including the latest developments in the midterms. On board:
* Leslie Marshall, liberal radio talk show host
* Julian Epstein, Democratic strategist
* Michael Smerconish, conservative radio talk show host
* Larry Sabato, political scientist at the Univeristy of Virginia
A Washington to Wall Street debate on the economy, politics, and more. Tonight will be a battle between former Treasury undersecretary Gary Gensler and Jim Glassman, a fellow at the American Enterprise Institute and host of TechCentralStation.com. (The plan is to have these two duke it out each week, similar to our dynamic duo of Robert Reich and Steve Moore.)
It's your money. It's your vote. 12 Days left till November 7th...
Rove Begs to Differ
I ran into Karl Rove yesterday afternoon while standing in the hallway of the West Wing after our Oval Office meeting with President Bush. I asked the President’s senior adviser if he thought Republicans could still take the House.
Rove looked at me straight in the eye, and without missing a beat he responded “absolutely.”
Virtually all the latest polls have been incredibly bearish for the GOP’s midterm prospects. Zogby, Gallup, you name it - they’re all predicting major losses for Republicans.
Talking heads are no longer debating whether the GOP loses the House, but by how many seats. Over on the Senate side, while things aren’t nearly as doom and gloom, a number of pollsters and commentators think the Dems have a good shot of capturing control.
Rove thinks they’re all wrong.
We shall see.
Rove looked at me straight in the eye, and without missing a beat he responded “absolutely.”
Virtually all the latest polls have been incredibly bearish for the GOP’s midterm prospects. Zogby, Gallup, you name it - they’re all predicting major losses for Republicans.
Talking heads are no longer debating whether the GOP loses the House, but by how many seats. Over on the Senate side, while things aren’t nearly as doom and gloom, a number of pollsters and commentators think the Dems have a good shot of capturing control.
Rove thinks they’re all wrong.
We shall see.
Kill Sadr
Investors Business Daily and Ralph Peters both nailed it today—absolutely nailed it:
Time to get that fat boy Muqtada al-Sadr.
IBD editorial: …Sadr now has more than 5,000 men under arms, according to U.S. intelligence estimates. And as it turns out, Sadr is a major client of Iran's extremist mullahs. He'll keep sending young Iraqi Shiites to their death on behalf of a foreign power — particularly if it means destroying any chance Iraq has of being a stable democracy…
Peters in the New York Post:
The first thing we need to do is to kill Muqtada al-Sadr, who's now a greater threat to our strategic goals than Osama bin Laden.
We should've killed him in 2003, when he first embarked upon his murder campaign. But our leaders were afraid of provoking riots.
… Our policy of all-carrots-no-sticks has failed miserably. We delivered Iraq to zealots, gangsters and terrorists. Now our only hope is to prove that we mean business - that the era of peace, love and wasting American lives is over.
And after we've killed Muqtada and destroyed his Mahdi Army, we need to go after the Sunni insurgents. If we can't leave a democracy behind, we should at least leave the corpses of our enemies.
The holier-than-thou response to this proposal is predictable: "We can't kill our way out of this situation!" Well, boo-hoo. Friendly persuasion and billions of dollars haven't done the job. Give therapeutic violence a chance....
Count me in my friend Ralph Peters' camp.
We need to send that murderous, anti-American jerk to jail—or, better yet, send him a one-way ticket to his 72 virgins in Never-Never land.
How is it possible that this miscreant, who has been nothing but trouble, who has been working around the clock to sow seeds of murder, mayhem and unrest, fomenting war against Sunnis, etc, etc, is still on the lam?
This is a major flaw in the operation. I just don’t get it.
Time to get that fat boy Muqtada al-Sadr.
IBD editorial: …Sadr now has more than 5,000 men under arms, according to U.S. intelligence estimates. And as it turns out, Sadr is a major client of Iran's extremist mullahs. He'll keep sending young Iraqi Shiites to their death on behalf of a foreign power — particularly if it means destroying any chance Iraq has of being a stable democracy…
Peters in the New York Post:
The first thing we need to do is to kill Muqtada al-Sadr, who's now a greater threat to our strategic goals than Osama bin Laden.
We should've killed him in 2003, when he first embarked upon his murder campaign. But our leaders were afraid of provoking riots.
… Our policy of all-carrots-no-sticks has failed miserably. We delivered Iraq to zealots, gangsters and terrorists. Now our only hope is to prove that we mean business - that the era of peace, love and wasting American lives is over.
And after we've killed Muqtada and destroyed his Mahdi Army, we need to go after the Sunni insurgents. If we can't leave a democracy behind, we should at least leave the corpses of our enemies.
The holier-than-thou response to this proposal is predictable: "We can't kill our way out of this situation!" Well, boo-hoo. Friendly persuasion and billions of dollars haven't done the job. Give therapeutic violence a chance....
Count me in my friend Ralph Peters' camp.
We need to send that murderous, anti-American jerk to jail—or, better yet, send him a one-way ticket to his 72 virgins in Never-Never land.
How is it possible that this miscreant, who has been nothing but trouble, who has been working around the clock to sow seeds of murder, mayhem and unrest, fomenting war against Sunnis, etc, etc, is still on the lam?
This is a major flaw in the operation. I just don’t get it.
Wednesday, October 25, 2006
Tonight's Lineup
***CNBC'S KUDLOW & COMPANY WILL BROADCAST LIVE AT 5PM FROM WASHINGTON THIS EVENING FOLLOWING THIS AFTERNOON'S MEETING WITH PRESIDENT BUSH...On tonight's Washington to Wall Street program:
A look at today's Fed's action, the economy and the stock market. On board:
* John Augustine, Chief Investment Strategist at Fifth Third Asset Management
* Joe LaVorgna, Chief US Fixed Income Economist at Deutsche Bank
* Lawrence Mishel, president of the Economic Policy Institute
* Steve Moore, senior economics writer for The Wall Street Journal
A look at the situation in Iraq with President Clinton’s former national security aide P.J. Crowley, and Ian Bremmer, president of Eurasia Group, a political risk consulting firm.
Former House Majority Leader Dick Armey will debate politics and the midterm elections with Ted Rall, liberal editorial cartoonist.
And finally, a Berkeley student debate (check out the WSJ's recent article) between Josiah Prendergast, President of Berkeley College Republicans and Suzanne Reucker, President of Cal-Berkeley Democrats.
IT'S YOUR MONEY & YOUR VOTE: DAY 13 IN THE ELECTION COUNTDOWN...
A headline at Drudge:
*Defiant PM Disavows Timetable...
U.S. and Iraqi forces raided the stronghold of a Shiite militia led by a radical anti-American cleric in search of a death squad leader in an operation disavowed by Prime Minister Nouri al-Maliki.
Al-Maliki, who relies on political support from the cleric Muqtada al- Sadr, said the strike against a figure in al-Sadr's Mahdi militia in Sadr City "will not be repeated."
The defiant al-Maliki also slammed the top U.S. military and diplomatic representatives in Iraq for saying his government needed to set a timetable to curb violence in the country...
"[N]o one has the right to impose a timetable on it," al-Maliki said at a news conference....
Huh?
Who is this guy??
*Defiant PM Disavows Timetable...
U.S. and Iraqi forces raided the stronghold of a Shiite militia led by a radical anti-American cleric in search of a death squad leader in an operation disavowed by Prime Minister Nouri al-Maliki.
Al-Maliki, who relies on political support from the cleric Muqtada al- Sadr, said the strike against a figure in al-Sadr's Mahdi militia in Sadr City "will not be repeated."
The defiant al-Maliki also slammed the top U.S. military and diplomatic representatives in Iraq for saying his government needed to set a timetable to curb violence in the country...
"[N]o one has the right to impose a timetable on it," al-Maliki said at a news conference....
Huh?
Who is this guy??
Headed to the White House
I’m back in Washington.
Later this afternoon, I’ll be heading over to the White House to sit down with President Bush. Charles Krauthammer, Byron York, and a few others will meet in the West Wing to interview the President. It’ll all be on the record.
I plan to ask the President about Grover Cleveland’s veto strategy should the Dems win control November 7th. I’m sure we’ll also discuss the situation in Iraq, the midterms and the economy as well.
We’ll be doing Kudlow & Company live from the nation’s capital tonight.
It's coming down to the wire folks - less than two weeks left till the day of reckoning for Dems and Republicans…
Later this afternoon, I’ll be heading over to the White House to sit down with President Bush. Charles Krauthammer, Byron York, and a few others will meet in the West Wing to interview the President. It’ll all be on the record.
I plan to ask the President about Grover Cleveland’s veto strategy should the Dems win control November 7th. I’m sure we’ll also discuss the situation in Iraq, the midterms and the economy as well.
We’ll be doing Kudlow & Company live from the nation’s capital tonight.
It's coming down to the wire folks - less than two weeks left till the day of reckoning for Dems and Republicans…
Don't Measure the Drapes Just Yet
Some snippets from the President’s speech yesterday in Florida:
The Democrats said the tax cuts were not the solution to solving an economy that was slipping into recession. You might remember back in 2001. The truth is the tax cuts have helped make the American economy grow faster than any major industrialized nation. This economy is the envy of the world.
The Democrats said that the tax cuts would lead to a jobless recovery. The truth is that our economy has added jobs for 37 months in a row, and since August of 2003, our economy has created 6.6 million new jobs.
The Democrats said tax cuts would not help increase wages. Well, the truth is real wages have grown 2.2 percent over the last 12 months.
The Democrats said tax cuts would cause the deficit to explode. Well, the truth is that tax cuts led to economic growth, and that growth has helped send tax revenues soaring. And, as a result, the deficit has been cut in half three years ahead of schedule.
The Democrats have made a lot of predictions. Matter of fact, I think they may be measuring the drapes. If their electoral predictions are as reliable as their economic predictions, November 7th is going to be a good day for the Republicans.
The Democrats said the tax cuts were not the solution to solving an economy that was slipping into recession. You might remember back in 2001. The truth is the tax cuts have helped make the American economy grow faster than any major industrialized nation. This economy is the envy of the world.
The Democrats said that the tax cuts would lead to a jobless recovery. The truth is that our economy has added jobs for 37 months in a row, and since August of 2003, our economy has created 6.6 million new jobs.
The Democrats said tax cuts would not help increase wages. Well, the truth is real wages have grown 2.2 percent over the last 12 months.
The Democrats said tax cuts would cause the deficit to explode. Well, the truth is that tax cuts led to economic growth, and that growth has helped send tax revenues soaring. And, as a result, the deficit has been cut in half three years ahead of schedule.
The Democrats have made a lot of predictions. Matter of fact, I think they may be measuring the drapes. If their electoral predictions are as reliable as their economic predictions, November 7th is going to be a good day for the Republicans.
Tuesday, October 24, 2006
(Speaker?) Pelosi on Kudlow & Company Tonight
Just finished the Pelosi interview. Here are some noteworthy snippets to whet your appetite:
*** She believes we're in a Democratic bull market.
*** Dems will balance the budget.
*** Tax hikes only as a last resort.
*** It's time to get out of Iraq.
*** Oil companies should have a windfall profits tax.
Be sure to tune into this evening!
*** She believes we're in a Democratic bull market.
*** Dems will balance the budget.
*** Tax hikes only as a last resort.
*** It's time to get out of Iraq.
*** Oil companies should have a windfall profits tax.
Be sure to tune into this evening!
GOP Base Coming Home?
Dick Morris thinks so. He says control of Congress has gone from "leans Democrat" to a "toss-up":
The latest polls show something very strange and quite encouraging is happening: The Republican base seems to be coming back home. This trend, only vaguely and dimly emerging from a variety of polls, suggests that a trend may be afoot that would deny the Democrats control of the House and the Senate.
...Why are Republican fortunes brightening?
The GOP base, alienated by the Foley scandal and the generally dismal record of this Congress, may have fast forwarded to the prospect of a Democratic victory and recoiled. They may have pondered the impact of a repeal of the Patriot Act, a ban on NSA wiretapping and a requirement of having an attorney present in terrorist questioning - and decided not to punish the country for the sins of the Republican leaders....
The latest polls show something very strange and quite encouraging is happening: The Republican base seems to be coming back home. This trend, only vaguely and dimly emerging from a variety of polls, suggests that a trend may be afoot that would deny the Democrats control of the House and the Senate.
...Why are Republican fortunes brightening?
The GOP base, alienated by the Foley scandal and the generally dismal record of this Congress, may have fast forwarded to the prospect of a Democratic victory and recoiled. They may have pondered the impact of a repeal of the Patriot Act, a ban on NSA wiretapping and a requirement of having an attorney present in terrorist questioning - and decided not to punish the country for the sins of the Republican leaders....
Pelosi on Kudlow & Company Tonight
House Democratic leader Nancy Pelosi - perhaps the next speaker of the House - will join us on tonight's Kudlow & Company. We're also pleased to welcome Mark Steyn, author of "America Alone," back to the show.
Two weeks left until election day...
Ralph Peters on politically correct cowardice in today's New York Post:
I wish the world were as innocent as intellectuals pretend. But we're far from the Peaceable Kingdom. If we're unwilling to behave ferociously toward terrorists and thugs, they'll behave with greater ferocity toward the innocent. That's a consistent equation in humanity's moral algebra....
I wish the world were as innocent as intellectuals pretend. But we're far from the Peaceable Kingdom. If we're unwilling to behave ferociously toward terrorists and thugs, they'll behave with greater ferocity toward the innocent. That's a consistent equation in humanity's moral algebra....
The Australian delivered a superb editorial on multiculturalism today:
HOW tolerant must a free society be of those who are intolerant of the values it holds dear? This question is at the heart of a controversy that has flared up in Britain over the past fortnight concerning Muslim women who wear nikabs, burkas and other face coverings that allow little more than the eyes to be seen.
...At its heart is the question of where tolerance should end and the old adage, "When in Rome, do as the Romans", should kick in. While tolerance is certainly a positive virtue that should be strived for, it cannot be a cultural suicide pact. A culture that is tolerant of those who are intolerant of its freedoms is ripe for destruction, and bit by bit will see all it values eroded. And radical Islam knows this. Just as an Australian wouldn't go to Saudi Arabia to wear a bikini on the beach and drink beer in the corner pub, those who see the proper role of women as subservient, anonymous and under cover should not expect a postmodern secular democracy such as Britain or Australia to accommodate these beliefs....
HOW tolerant must a free society be of those who are intolerant of the values it holds dear? This question is at the heart of a controversy that has flared up in Britain over the past fortnight concerning Muslim women who wear nikabs, burkas and other face coverings that allow little more than the eyes to be seen.
...At its heart is the question of where tolerance should end and the old adage, "When in Rome, do as the Romans", should kick in. While tolerance is certainly a positive virtue that should be strived for, it cannot be a cultural suicide pact. A culture that is tolerant of those who are intolerant of its freedoms is ripe for destruction, and bit by bit will see all it values eroded. And radical Islam knows this. Just as an Australian wouldn't go to Saudi Arabia to wear a bikini on the beach and drink beer in the corner pub, those who see the proper role of women as subservient, anonymous and under cover should not expect a postmodern secular democracy such as Britain or Australia to accommodate these beliefs....
Monday, October 23, 2006
Midterms & the Stock Market
It may not be the Pelosi bull market after all.
The roaring stock market today is trading off yesterday’s Barron’s article that says the GOP’s money advantage will limit Democratic gains and keep the House and Senate in Republican hands.
The mainstream media is not reporting this counter-conventional poll from our friend Jim McTague—but that’s really the big news driving the market.
It’s a tempting thought that this summer and fall’s stock market rally is the most important poll predicting a Republican hold. And frankly, I would love to believe Jim Mctague’s results. But I’m still somewhat skeptical.
Tradesports’ House GOP contract is still trading in the mid 30s—no excitement there off the Barron’s story.
Nonetheless, let's get a big GOP bandwagon message out there. Trumpet the strong economy and the roaring stock market. Get out there and broadcast that jobs are rising, wealth is surging, and lower tax rates are working.
In short, get the investor class to the polls in droves.
The roaring stock market today is trading off yesterday’s Barron’s article that says the GOP’s money advantage will limit Democratic gains and keep the House and Senate in Republican hands.
The mainstream media is not reporting this counter-conventional poll from our friend Jim McTague—but that’s really the big news driving the market.
It’s a tempting thought that this summer and fall’s stock market rally is the most important poll predicting a Republican hold. And frankly, I would love to believe Jim Mctague’s results. But I’m still somewhat skeptical.
Tradesports’ House GOP contract is still trading in the mid 30s—no excitement there off the Barron’s story.
Nonetheless, let's get a big GOP bandwagon message out there. Trumpet the strong economy and the roaring stock market. Get out there and broadcast that jobs are rising, wealth is surging, and lower tax rates are working.
In short, get the investor class to the polls in droves.
Pay-Go and Polls: What a Predicament
From my latest syndicated column:
Most supply-siders believe that if the Democrats manage to take the House and Senate two-and-a-half weeks from now, President Bush’s investor tax cuts will be safe. First, the tax cuts already have been extended to 2010. Second, the president will surely veto any tax-hike legislation that a new Democratic Congress might pass. (Think Grover Cleveland, the greatest presidential veto-er in American history.)
Maybe so, but the political story will be more complicated, especially if a Democratic Congress passes new “pay-as-you-go” rules. This could put the tax cuts in jeopardy as early as next year.
There are essentially two kinds of pay-go. One is a spending limitation that was used by the Gingrich Congress to balance the budget in the 1990s. This would be good. The other is a revenue pay-go, which is not so good. In this scenario, if the Democrats cobbled together a big-bang deficit-reduction package, large tax hikes would be put in place to meet the new deficit targets. Since Congress scores the investor tax cuts on dividends and capital gains as static revenue losses — even though the evidence shows they pay for themselves — these tax cuts would be subject to repeal or rollback.
Should revenue pay-go materialize, President Bush might be confronted with a Hobbesian choice of vetoing a so-called $500 billion deficit-reduction package that would increase the cap-gain, dividend, and top-income-bracket tax rates.
Truth be told, the Democratic party desperately wants to return the income-tax rate to President Clinton’s 39.6 percent. It’s an obsession that’s lodged in the Democratic DNA, a class-warfare mentality that seeks to penalize the rich and soak American success. In practice, it would be a Soviet-style income-leveling exercise in the name of making the non-rich feel better.
And it’s nonsense.
President George W. Bush’s tax cuts have done an amazing job of reigniting the U.S. economy. The 2003 tax cuts rallied the stock market, generated 6.5 million new jobs, and produced soaring revenues that have, in turn, slashed the deficit.
But all this is in peril if the new pay-go rules go through.
So let me warn my conservative friends and fellow members of the American investor class: A Democratic sweep come November 7 will put Bush’s hugely successful tax cuts on the chopping block.
It’s a sobering thought, particularly in light of sinking Republican fortunes.
On Tradesports, the online betting parlor, the House GOP 2006 contract has dropped to a new low of 32 percent. In late September, prior to the Mark Foley scandal, it had been 57 percent. Bettors, it seems, are giving up on the contract.
On the Senate side, the contract is still a 70 percent bet the Republicans will hold the upper chamber. This points to a congressional split, meaning Washington will “do no harm” on pro-growth measures, especially tax policy. But it is still possible that a phony pay-go revenue deal could surface with a coalition of House Democrats, liberal Republican Senators, and Senate Democrats.
Just as troubling is an anti-growth surge toward protectionist trade activity. The Democrats are against free trade almost uniformly, with 30 to 40 percent of Republicans considered unreliable on the subject. A Wall Street Journal story this week reveals a strong push for textile protectionism against China, Vietnam, Africa, Haiti, and South America. The supply-side growth model stresses a steady dollar, low tax rates, and free trade to promote growth. Hence, should protectionist legislation trudge forth, it would be an anti-growth lose-lose situation for the U.S. and its trading partners.
All this said, the roaring stock market remains very much in favor of a divided Congress. Republican polls are going down, and stocks are going up? Is this the Pelosi bull market? Perhaps so.
But if both chambers shift Democrat, taxes, trade, and spending may all go the wrong way. In the New York Times this week, Robert Pear details Democratic plans to control drug prices and attack health insurers and pharmaceutical companies. It’s Hillarycare all over again; a takeover of 15 percent of our economy.
President Bush’s economic approval rating has risen 5 points to 44 percent in a new Wall Street Journal/NBC News poll. Republicans should follow the president’s lead and flog away on the economy, the benefits of lower tax rates, and dropping gas prices. They also should loudly trumpet the splendid stock market rally. Indeed, across the next 18 days, this is the GOP’s best chance to generate an enthusiastic vote turnout from the investor class.
Pollster Scott Rasmussen shows that entrepreneurs (49%) and investors (46%) are the two groups most appreciative of the job the president is doing. Message to the GOP: Talk up the low-tax, Goldilocks stock market economy and get these folks to the polls.
It’s your last chance boys and girls.
Most supply-siders believe that if the Democrats manage to take the House and Senate two-and-a-half weeks from now, President Bush’s investor tax cuts will be safe. First, the tax cuts already have been extended to 2010. Second, the president will surely veto any tax-hike legislation that a new Democratic Congress might pass. (Think Grover Cleveland, the greatest presidential veto-er in American history.)
Maybe so, but the political story will be more complicated, especially if a Democratic Congress passes new “pay-as-you-go” rules. This could put the tax cuts in jeopardy as early as next year.
There are essentially two kinds of pay-go. One is a spending limitation that was used by the Gingrich Congress to balance the budget in the 1990s. This would be good. The other is a revenue pay-go, which is not so good. In this scenario, if the Democrats cobbled together a big-bang deficit-reduction package, large tax hikes would be put in place to meet the new deficit targets. Since Congress scores the investor tax cuts on dividends and capital gains as static revenue losses — even though the evidence shows they pay for themselves — these tax cuts would be subject to repeal or rollback.
Should revenue pay-go materialize, President Bush might be confronted with a Hobbesian choice of vetoing a so-called $500 billion deficit-reduction package that would increase the cap-gain, dividend, and top-income-bracket tax rates.
Truth be told, the Democratic party desperately wants to return the income-tax rate to President Clinton’s 39.6 percent. It’s an obsession that’s lodged in the Democratic DNA, a class-warfare mentality that seeks to penalize the rich and soak American success. In practice, it would be a Soviet-style income-leveling exercise in the name of making the non-rich feel better.
And it’s nonsense.
President George W. Bush’s tax cuts have done an amazing job of reigniting the U.S. economy. The 2003 tax cuts rallied the stock market, generated 6.5 million new jobs, and produced soaring revenues that have, in turn, slashed the deficit.
But all this is in peril if the new pay-go rules go through.
So let me warn my conservative friends and fellow members of the American investor class: A Democratic sweep come November 7 will put Bush’s hugely successful tax cuts on the chopping block.
It’s a sobering thought, particularly in light of sinking Republican fortunes.
On Tradesports, the online betting parlor, the House GOP 2006 contract has dropped to a new low of 32 percent. In late September, prior to the Mark Foley scandal, it had been 57 percent. Bettors, it seems, are giving up on the contract.
On the Senate side, the contract is still a 70 percent bet the Republicans will hold the upper chamber. This points to a congressional split, meaning Washington will “do no harm” on pro-growth measures, especially tax policy. But it is still possible that a phony pay-go revenue deal could surface with a coalition of House Democrats, liberal Republican Senators, and Senate Democrats.
Just as troubling is an anti-growth surge toward protectionist trade activity. The Democrats are against free trade almost uniformly, with 30 to 40 percent of Republicans considered unreliable on the subject. A Wall Street Journal story this week reveals a strong push for textile protectionism against China, Vietnam, Africa, Haiti, and South America. The supply-side growth model stresses a steady dollar, low tax rates, and free trade to promote growth. Hence, should protectionist legislation trudge forth, it would be an anti-growth lose-lose situation for the U.S. and its trading partners.
All this said, the roaring stock market remains very much in favor of a divided Congress. Republican polls are going down, and stocks are going up? Is this the Pelosi bull market? Perhaps so.
But if both chambers shift Democrat, taxes, trade, and spending may all go the wrong way. In the New York Times this week, Robert Pear details Democratic plans to control drug prices and attack health insurers and pharmaceutical companies. It’s Hillarycare all over again; a takeover of 15 percent of our economy.
President Bush’s economic approval rating has risen 5 points to 44 percent in a new Wall Street Journal/NBC News poll. Republicans should follow the president’s lead and flog away on the economy, the benefits of lower tax rates, and dropping gas prices. They also should loudly trumpet the splendid stock market rally. Indeed, across the next 18 days, this is the GOP’s best chance to generate an enthusiastic vote turnout from the investor class.
Pollster Scott Rasmussen shows that entrepreneurs (49%) and investors (46%) are the two groups most appreciative of the job the president is doing. Message to the GOP: Talk up the low-tax, Goldilocks stock market economy and get these folks to the polls.
It’s your last chance boys and girls.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll begin tonight's program with reaction to President Bush's CNBC interview. Our political panel includes:
* Jim McTague, columnist for Barron's Magazine, who predicts the GOP will hold on to both houses.
* Julian Epstein, Democratic strategist
* Larry Sabato, University of Virginia politcal scientist
* Kellyanne Conway, founder and president of The Polling Company
We'll explore the latest trends and developments in the stock market and economy with John Silvia, chief economist at Wachovia and Keith Wirtz, president/chief investment officer for Fifth Third Asset Management.
Jed Babbin, former deputy undersecretary of defense, will weigh in with his thoughts on the war in Iraq.
Sen. Kay Baily Hutchison (R-TX) will offer her perspective on a host of topics, including the midterm elections.
Frank Newport, editor in chief of The Gallup Poll, will bring some political clarity in our regular "Sunday Unspun" segment.
From National Review's "The Week", 11/6/06:A largely unreported civil war is going on in France: Arab and Muslim youth daily fight the police. At the end of last year, in many weeks of continuous and violent rioting, the police—indeed, the government—lost control of the street and have been trying to recover it ever since. No chance. This year, according to the latest count done by the Ministry of the Interior, nearly 2,500 officers have been wounded. The Muslims live in ghettoes and are largely unemployed. A high proportion either use or deal in drugs. In one such ghetto, Les Mureaux, a Paris suburb, two policemen tried to ticket a Muslim for not wearing a seatbelt. Refusing to stop, he rammed through the police car blocking his way. Hundreds of youths then stormed out of the high-rise buildings around and attacked the policemen, leaving one of them with a double-skull fracture. Spokesmen for the police speak of an intifada, and are demanding armored vehicles and water cannons to deal with it. But the politicians and media come out with their hands up, calling for more social services and affirmative action and giving permission to build ever more grandiose mosques. Pretty soon, there will be more skull fractures, if not worse.
What Will Happen
Dick Morris argues the GOP needs to sound the alarm and fill the airwaves with what will happen if the Democrats win:
Here's one possible ad: We see and hear a wiretapped conversation, with a terrorist revealing his worst plans to his associate - and, inadvertently, to government eavesdroppers, too. Then, when he's about to spill the beans on when and where the next attack is going to come, the line should go dead, with a dial tone, with a machine voice saying "This wiretap terminated in the name of privacy rights by the Democratic U.S. Congress."
The announcer can then say, "If the Democrats win, the National Security Agency will never be able to listen in as the terrorists are plotting to attack us."
Republicans are doomed unless they can get their base back. But the GOP base is the best informed group of voters in the nation, with educational levels consistently higher than their Democratic counterparts'. They follow politics closely and are the easiest voters to reach via the news media, cable TV and talk radio.
A message like this could have a snowballing effect on the Republican base. The word could percolate through the clutter, reminding voters of their true priorities....
Here's one possible ad: We see and hear a wiretapped conversation, with a terrorist revealing his worst plans to his associate - and, inadvertently, to government eavesdroppers, too. Then, when he's about to spill the beans on when and where the next attack is going to come, the line should go dead, with a dial tone, with a machine voice saying "This wiretap terminated in the name of privacy rights by the Democratic U.S. Congress."
The announcer can then say, "If the Democrats win, the National Security Agency will never be able to listen in as the terrorists are plotting to attack us."
Republicans are doomed unless they can get their base back. But the GOP base is the best informed group of voters in the nation, with educational levels consistently higher than their Democratic counterparts'. They follow politics closely and are the easiest voters to reach via the news media, cable TV and talk radio.
A message like this could have a snowballing effect on the Republican base. The word could percolate through the clutter, reminding voters of their true priorities....
Sunday, October 22, 2006
Barron's cover story:
JUBILANT DEMOCRATS SHOULD RECONSIDER their order for confetti and noisemakers. The Democrats, as widely reported, are expecting GOP-weary voters to flock to the polls in two weeks and hand them control of the House for the first time in 12 years -- and perhaps the Senate, as well. Even some Republicans privately confess that they are anticipating the election-day equivalent of Little Big Horn. Pardon our hubris, but we just don't see it.
Our analysis -- based on a race-by-race examination of campaign-finance data -- suggests that the GOP will hang on to both chambers, at least nominally. We expect the Republican majority in the House to fall by eight seats, to 224 of the chamber's 435. At the very worst, our analysis suggests, the party's loss could be as large as 14 seats, leaving a one-seat majority. But that is still a far cry from the 20-seat loss some are predicting. In the Senate, with 100 seats, we see the GOP winding up with 52, down three....
JUBILANT DEMOCRATS SHOULD RECONSIDER their order for confetti and noisemakers. The Democrats, as widely reported, are expecting GOP-weary voters to flock to the polls in two weeks and hand them control of the House for the first time in 12 years -- and perhaps the Senate, as well. Even some Republicans privately confess that they are anticipating the election-day equivalent of Little Big Horn. Pardon our hubris, but we just don't see it.
Our analysis -- based on a race-by-race examination of campaign-finance data -- suggests that the GOP will hang on to both chambers, at least nominally. We expect the Republican majority in the House to fall by eight seats, to 224 of the chamber's 435. At the very worst, our analysis suggests, the party's loss could be as large as 14 seats, leaving a one-seat majority. But that is still a far cry from the 20-seat loss some are predicting. In the Senate, with 100 seats, we see the GOP winding up with 52, down three....
Friday, October 20, 2006
Free Trade: From George to Greenspan
I was educated a protectionist and continued to believe in protection until I came to think for myself and examine the question. -Henry George
Free trade consists simply in letting people buy and sell as they want to buy and sell. Protective tariffs are as much applications of force as are blockading squadrons, and their objective is the same to prevent trade. The difference between the two is that blockading squadrons are a means whereby nations seek to prevent their enemies from trading; protective tariffs are a means whereby nations attempt to prevent their own people from trading.- Henry George, Protection or Free Trade 1886,
The evidence is overwhelmingly persuasive that the massive increase in world competition—a consequence of broadening trade flows—has fostered markedly higher standards of living for almost all countries who have participated in cross-border trade. I include most especially the United States.- Alan Greenspan, Speech, June 2, 1999.
Free trade consists simply in letting people buy and sell as they want to buy and sell. Protective tariffs are as much applications of force as are blockading squadrons, and their objective is the same to prevent trade. The difference between the two is that blockading squadrons are a means whereby nations seek to prevent their enemies from trading; protective tariffs are a means whereby nations attempt to prevent their own people from trading.- Henry George, Protection or Free Trade 1886,
The evidence is overwhelmingly persuasive that the massive increase in world competition—a consequence of broadening trade flows—has fostered markedly higher standards of living for almost all countries who have participated in cross-border trade. I include most especially the United States.- Alan Greenspan, Speech, June 2, 1999.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll start things off with a stock market/economic discussion. Our guests include:
** Don Luskin, Chief Investment Officer for Trend Macrolytics
** Arthur Laffer, Founder and CEO of Laffer Associates
** Robert Shiller, Yale economics professor
** Michael Crofton, Philadelphia Trust Co. President & CEO
Kudlow's Stock Club...Steve Folker, four-star Morningstar rated managing director of growth strategies at Fifth Third Asset Management, will offer his latest stock picks. (note: Mr. Folker is a return visitor - we will review his stockpicking results since his last appearance.)
A Iraq debate with Jed Babbin, former deputy undersecretary of defense.
And finally, a political roundup with:
** Peter Hart, public policy expert and CEO of Peter D. Hart Research Associates
** Sidney Blumenthal, author/former Clinton senior advisor
** David Limbaugh, conservative columnist David Limbaugh
It's your money and your vote - 18 days left in the election countdown...
Gleanings on the Midterms
The Tradesports House GOP 2006 contract has dropped several points to a new low at 32 percent. Bettors are now right at the point where they are giving up on the contract.
On the Senate side however, the contract is still a 70 percent bet on a Republican hold. So the online betting market is predicting a Congressional split. This is basically my own view that the GOP will barely hang on in the Senate, but will lose roughly 25 seats in the House.
However it’s gone down to the wire. This morning, Scott Rasmussen moved Montana Republican incumbent Conrad Burns into “toss-up” status from “leans Democrat” in his race against Tester.
A split Congress means that Washington will do no harm on pro-growth measures, especially tax policy.
However, it is still possible that a phony Pay-Go revenue deal could surface with a coalition of House Democrats, as well as liberal Republican Senators and Senate Democrats.
Presumably President Bush would then put on his Grover Cleveland hat and veto it.
More troubling is a big move toward protectionist trade activity. Dems are against free trade almost uniformly nowadays. And 30-40 percent of Republicans are unreliable on free trade.
A big WSJ story yesterday shows a strong push for textile protectionism with China, Vietnam, Africa, Haiti and South America. This would be totally anti-growth and lose-lose for the U.S. and the other nations.
Remember: the supply side growth model stresses low tax rates and free trade to promote growth, along with a steady dollar to contain inflation.
There’s no election correction in the stock market yet which is a great thing. The market will not worry about a split Congress. In fact, the stock market favors a split Congress. Think of it: Republican polls are going down, and stocks are going up. Is this the Pelosi bull market? Omygosh!
But if the Senate goes Democrat, the market will change its mind. Taxes, trade, spending, will all go the wrong way. Check out today’s Robert Pear story in the New York Times on Democratic plans to control drug prices, attack health insurers and pharmaceutical companies -- all rolling towards a Hillary-Care takeover of fifteen percent of our economy.
On the brighter side, The Wall Street Journal/NBC News poll shows a rise in President Bush’s handling of the economy where his approval has gone up 5 points to 44 percent. Republicans should be flogging away on the economy, the benefits of lower tax rates, as well as the drop in gasoline prices. And, they should be loudly trumpeting the splendid stock market rally.
This is the GOP’s very best bet in the next 18 days to rev up a big, enthusiastic turnout from the investor class.
Rasmussen shows that the two most favorable groups on President Bush’s job approval are entrepreneurs (49%) and investors (46%). Message to GOP: talk up the low tax, Goldilocks stock market and get these folks to the polls. It’s your last chance boys and girls.
On the Senate side however, the contract is still a 70 percent bet on a Republican hold. So the online betting market is predicting a Congressional split. This is basically my own view that the GOP will barely hang on in the Senate, but will lose roughly 25 seats in the House.
However it’s gone down to the wire. This morning, Scott Rasmussen moved Montana Republican incumbent Conrad Burns into “toss-up” status from “leans Democrat” in his race against Tester.
A split Congress means that Washington will do no harm on pro-growth measures, especially tax policy.
However, it is still possible that a phony Pay-Go revenue deal could surface with a coalition of House Democrats, as well as liberal Republican Senators and Senate Democrats.
Presumably President Bush would then put on his Grover Cleveland hat and veto it.
More troubling is a big move toward protectionist trade activity. Dems are against free trade almost uniformly nowadays. And 30-40 percent of Republicans are unreliable on free trade.
A big WSJ story yesterday shows a strong push for textile protectionism with China, Vietnam, Africa, Haiti and South America. This would be totally anti-growth and lose-lose for the U.S. and the other nations.
Remember: the supply side growth model stresses low tax rates and free trade to promote growth, along with a steady dollar to contain inflation.
There’s no election correction in the stock market yet which is a great thing. The market will not worry about a split Congress. In fact, the stock market favors a split Congress. Think of it: Republican polls are going down, and stocks are going up. Is this the Pelosi bull market? Omygosh!
But if the Senate goes Democrat, the market will change its mind. Taxes, trade, spending, will all go the wrong way. Check out today’s Robert Pear story in the New York Times on Democratic plans to control drug prices, attack health insurers and pharmaceutical companies -- all rolling towards a Hillary-Care takeover of fifteen percent of our economy.
On the brighter side, The Wall Street Journal/NBC News poll shows a rise in President Bush’s handling of the economy where his approval has gone up 5 points to 44 percent. Republicans should be flogging away on the economy, the benefits of lower tax rates, as well as the drop in gasoline prices. And, they should be loudly trumpeting the splendid stock market rally.
This is the GOP’s very best bet in the next 18 days to rev up a big, enthusiastic turnout from the investor class.
Rasmussen shows that the two most favorable groups on President Bush’s job approval are entrepreneurs (49%) and investors (46%). Message to GOP: talk up the low tax, Goldilocks stock market and get these folks to the polls. It’s your last chance boys and girls.
Thursday, October 19, 2006
Coup in Baghdad
An incredible Washington Times story suggests that the U.S. trained Iraqi army will overthrow Prime Minister Maliki and replace him with a strong man who would restore order while Washington looks the other way.
This coup scenario is being called Plan B.
Another Plan B scenario that might change American strategy in Iraq includes a partition of Sunnis, Shiites, and Kurdish regions.
Still another scenario is a gradual U.S. troop withdrawal.
But along the Arab political and military street there is a lot of talk about the coup overthrow scenario with Sunni generals in exile in the UAE and Saudi Arabia plotting to put a strongman in as the headman of Iraq.
Speaking of coups...
The Australian is reporting that China is getting closer to regime change in North Korea.
According to this account, there are two groups in North Korea: the royalists who support Crazy Kim and another group of Sino-philes who want to get rid of Kim Jong-il and set up a China like government in North Korea with Chinese style reforms.
Of course, this would be a very good thing. It even suggests that President Bush’s policies of Chinese diplomacy and U.N. trade sanctions might actually work. Under this coup plotting scenario, perhaps there would be economic liberalization in North Korea.
Still more on the coup front:
A source close to the Pentagon tells me that South Korean generals wish to overthrow President Roh.
Roh has consistently acted against U.S. interests and policies. He is even telling people that South Korea will not enforce the U.N. trade embargo on North Korea.
Coup plotting generals are waiting for a wink of the eye or a slight nod of the head from Mr. Rumsfeld and the U.S. Defense Department.
The generals are ready to act immediately according to this source.
This coup scenario is being called Plan B.
Another Plan B scenario that might change American strategy in Iraq includes a partition of Sunnis, Shiites, and Kurdish regions.
Still another scenario is a gradual U.S. troop withdrawal.
But along the Arab political and military street there is a lot of talk about the coup overthrow scenario with Sunni generals in exile in the UAE and Saudi Arabia plotting to put a strongman in as the headman of Iraq.
Speaking of coups...
The Australian is reporting that China is getting closer to regime change in North Korea.
According to this account, there are two groups in North Korea: the royalists who support Crazy Kim and another group of Sino-philes who want to get rid of Kim Jong-il and set up a China like government in North Korea with Chinese style reforms.
Of course, this would be a very good thing. It even suggests that President Bush’s policies of Chinese diplomacy and U.N. trade sanctions might actually work. Under this coup plotting scenario, perhaps there would be economic liberalization in North Korea.
Still more on the coup front:
A source close to the Pentagon tells me that South Korean generals wish to overthrow President Roh.
Roh has consistently acted against U.S. interests and policies. He is even telling people that South Korea will not enforce the U.N. trade embargo on North Korea.
Coup plotting generals are waiting for a wink of the eye or a slight nod of the head from Mr. Rumsfeld and the U.S. Defense Department.
The generals are ready to act immediately according to this source.
The Curse of Clinton?
Bill Clinton is out there joking that mangy old Republican dogs are telling folks that Democrats will raise taxes, send you to the poor house, and how terrorists loom on every street corner. So, let me get this straight: Clinton is saying tax hikes are fine and dandy. He’s also saying that terrorism is not a threat.
This doesn’t strike me as a winning message.
Clinton may be more of a liability than an asset for the Dems. I hope he gets his message out. And I hope the GOP takes him on.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll begin tonight with a look at the state of the stock market and economy. Our guests include:
** Brian Wesbury, Chief Economist at First Trust Advisors
** Diane Swonk, Chief Economist for Mesirow Financial
** Elizabeth MacDonald, Forbes magazine senior editor
YOUR MONEY, YOUR VOTE...Will there be a Bush policy reversal if the Democrats take Congress? On board to discuss are former labor secretary/UC Berkley professor Robert Reich and the Wall Street Journal's Steve Moore. (We'll also take a look at the budget and economic outlook with these two fine gents...)
Rob Portman, director of the Office of Management and Budget, will join us to offer his perspective.
A Nuclear Iraq & North Korea?...Sen. Sam Brownback (R-KS) and Sen. Ken Salazar (D-CO) will weigh in.
A political debate between Lanny Davis, author and White House special counsel in the Clinton administration; Terry Jeffrey, editor of Human Events; and Time magazine's Mike Allen.
It's going to be a great show - don't miss it...
Bill Clinton, Mark Steyn & Those Mangy GOP Dogs
(We had a dynamite poltical segment on last night's Kudlow & Company with Tony Blankley, Mark Steyn, and Tony Coelho. The following is a brilliant exchange from conservative genius/author Mark Steyn - who incidentally, has a new book out which is getting rave reviews. It's next on my reading list...)
KUDLOW: I want to ask you, Mark Steyn, right off the top, you heard Mr. Clinton. He says if you believe those mangy dogs, the Republicans, the 'Dems will tax you into the poor house and on the way there, there'll be a terrorist on every street corner.' Mark Steyn, what is your assessment of what Clinton is saying out there?
MARK STEYN: Well, he summed up the two basic core beliefs of the Democratic Party - that you need higher taxes, and that there is no terrorist threat. And both of those are profoundly wrong. The first makes us small like Europe which is basically voting for national suicide. And the second, one reason why there are terrorists on so many street corners in the world is because Clinton did nothing about it in the gay '90s. In fairness to him, that's a more credible Democrat message, a more credible message than saying, you know, 'Vote for the Democrats because there is gay Republican congressman predator on every corner,' which has been the Democrats' message for the last couple of weeks. That's ridiculous.
...In a way, there is either a threat or there isn't a threat. And Clinton's strategy of just joking and saying, `Oh, there's no threat. It's just some cockamamie thing got up by the Bush administration, actually works better than what those House and Senate Democrats did which is vote to make themselves look like the terrorists' rights party. I think it's clear that there's a lot of Republican anger among the base and conservative anger among the base about the conduct of this war, but every time the Democrats in the Senate and the House have to take a vote on issues like the detainees in Guantanamo, they put themselves in a very unattractive corner electorally. And I simply think that the American people are not ready to go there.
(Note: In the Senate, 75 percent of the Democrats voted against the terrorist interrogation bill. In the House, more than 80 percent voted against it. Sen. Harry Reid (D-NV) - who vehemently opposed the Patriot Act - actually said that he's "convinced that future generations will view passage of this bill as a grave error." Huh?)
KUDLOW: I want to ask you, Mark Steyn, right off the top, you heard Mr. Clinton. He says if you believe those mangy dogs, the Republicans, the 'Dems will tax you into the poor house and on the way there, there'll be a terrorist on every street corner.' Mark Steyn, what is your assessment of what Clinton is saying out there?
MARK STEYN: Well, he summed up the two basic core beliefs of the Democratic Party - that you need higher taxes, and that there is no terrorist threat. And both of those are profoundly wrong. The first makes us small like Europe which is basically voting for national suicide. And the second, one reason why there are terrorists on so many street corners in the world is because Clinton did nothing about it in the gay '90s. In fairness to him, that's a more credible Democrat message, a more credible message than saying, you know, 'Vote for the Democrats because there is gay Republican congressman predator on every corner,' which has been the Democrats' message for the last couple of weeks. That's ridiculous.
...In a way, there is either a threat or there isn't a threat. And Clinton's strategy of just joking and saying, `Oh, there's no threat. It's just some cockamamie thing got up by the Bush administration, actually works better than what those House and Senate Democrats did which is vote to make themselves look like the terrorists' rights party. I think it's clear that there's a lot of Republican anger among the base and conservative anger among the base about the conduct of this war, but every time the Democrats in the Senate and the House have to take a vote on issues like the detainees in Guantanamo, they put themselves in a very unattractive corner electorally. And I simply think that the American people are not ready to go there.
(Note: In the Senate, 75 percent of the Democrats voted against the terrorist interrogation bill. In the House, more than 80 percent voted against it. Sen. Harry Reid (D-NV) - who vehemently opposed the Patriot Act - actually said that he's "convinced that future generations will view passage of this bill as a grave error." Huh?)
From NRO:
In 2004, two out of three voters were investors, the majority of which voted to re-elect President George W. Bush. In fact, investors increased their vote for Bush from 51-46 in 2000 to 53-46 in 2004. As a result, Bush received 5 million more votes in the last election than the first time around, and eclipsed national levels for all categories of investors, including self-identified members of the investor class, 401(k) owners, and direct stockowners.
Today, however, even with the stock market at an all-time high, generic support for Republicans running for Congress has fallen. Why? Because the GOP has failed to explain how their pro-investor tax cuts produced the stock market boom. Additionally, Republicans have yet to put forth a compelling policy agenda that speaks to the desire of American shareholders to build savings and wealth for themselves and their families.
...Granted, the war in Iraq, the Mark Foley page scandal, and other issues are front and center these days. But the fact of the matter is that the GOP is not speaking to the aspirations of the middle-class investor voter....
In 2004, two out of three voters were investors, the majority of which voted to re-elect President George W. Bush. In fact, investors increased their vote for Bush from 51-46 in 2000 to 53-46 in 2004. As a result, Bush received 5 million more votes in the last election than the first time around, and eclipsed national levels for all categories of investors, including self-identified members of the investor class, 401(k) owners, and direct stockowners.
Today, however, even with the stock market at an all-time high, generic support for Republicans running for Congress has fallen. Why? Because the GOP has failed to explain how their pro-investor tax cuts produced the stock market boom. Additionally, Republicans have yet to put forth a compelling policy agenda that speaks to the desire of American shareholders to build savings and wealth for themselves and their families.
...Granted, the war in Iraq, the Mark Foley page scandal, and other issues are front and center these days. But the fact of the matter is that the GOP is not speaking to the aspirations of the middle-class investor voter....
"The Wal-Mart Posse"
If you haven't already read this Wall Street Journal article, it's well worth the read. As the WSJ points out, even Hillary Clinton - a former 6-year Wal-Mart board member - is piling on (despite the fact she was paid tens of thousands of dollars during her Wal-Mart tenure...)
Wal-Mart may be expanding in the People's Republic of China, but here in capitalist America the low-price retailer has become the Democratic Party's favorite pinata. The media like to portray this as a populist uprising against heartless big business. But what they don't bother to disclose is that this entire get-Wal-Mart campaign is a political operation led and funded by organized labor.
We've done a little digging into the two most prominent anti-Wal-Mart groups, and they might as well operate out of AFL-CIO headquarters.
...this campaign isn't about "working families," or any of the other rhapsody-for-the-common-man union slogans. If Wal-Mart were suddenly unionized, Big Labor's membership would double overnight and union leaders would collect an estimated $300 million in additional dues each year to sway more politicians. Short of that, their goal is to keep Wal-Mart out of cities so their union shops have less competition. That's what the war against Wal-Mart is truly about.
Wal-Mart may be expanding in the People's Republic of China, but here in capitalist America the low-price retailer has become the Democratic Party's favorite pinata. The media like to portray this as a populist uprising against heartless big business. But what they don't bother to disclose is that this entire get-Wal-Mart campaign is a political operation led and funded by organized labor.
We've done a little digging into the two most prominent anti-Wal-Mart groups, and they might as well operate out of AFL-CIO headquarters.
...this campaign isn't about "working families," or any of the other rhapsody-for-the-common-man union slogans. If Wal-Mart were suddenly unionized, Big Labor's membership would double overnight and union leaders would collect an estimated $300 million in additional dues each year to sway more politicians. Short of that, their goal is to keep Wal-Mart out of cities so their union shops have less competition. That's what the war against Wal-Mart is truly about.
Wednesday, October 18, 2006
Pelosi-nomics
(Many thanks to my friend Dan Clifton over at the American Shareholders Association for painting such a clear economic picture here...)
“None of these tax cuts is affordable. None of them creates jobs, and they are not fair. All of them do damage to our long-term economic growth and contribute to the national deficit.” -House Minority Leader Nancy Pelosi (D-CA); May 09, 2003
Fact: 6.6 Million New Jobs
Fact: Unemployment Rate Drops From 6.3 Percent to 4.6 Percent
Fact: Unemployment Rate Dropping Faster Than CBO Expected
Fact: GDP Soars Following Tax Cut
Fact: Total Household Net Worth Has Increased by $14.4 Trillion Since the Tax Cut
Fact: The Deficit Has Declined $208 Billion Since April 2004 and $60 Billion Since the Tax Cut Was Signed Into Law
Ladies and gentlemen, it is still the greatest story never told...
“None of these tax cuts is affordable. None of them creates jobs, and they are not fair. All of them do damage to our long-term economic growth and contribute to the national deficit.” -House Minority Leader Nancy Pelosi (D-CA); May 09, 2003
Fact: 6.6 Million New Jobs
Fact: Unemployment Rate Drops From 6.3 Percent to 4.6 Percent
Fact: Unemployment Rate Dropping Faster Than CBO Expected
Fact: GDP Soars Following Tax Cut
Fact: Total Household Net Worth Has Increased by $14.4 Trillion Since the Tax Cut
Fact: The Deficit Has Declined $208 Billion Since April 2004 and $60 Billion Since the Tax Cut Was Signed Into Law
Ladies and gentlemen, it is still the greatest story never told...
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll kick off tonight's show with the Goldilocks economy and the Dow's flirtation with 12,000. On board:
** John Rutledge, Chairman and CEO of Rutledge Capital
** Barry Ritholtz, President of Ritholtz Capital Partners
** Joe Battipaglia, Chief Investment Officer at Ryan, Beck & Co
** Craig Columbus, Chief market strategist, Thomson Financial
An economic debate between Nouriel Roubini, economics professor at NYU's Stern School of Business and David Malpass, chief economist for Bear Stearns.
An all-star political panel to discuss/debate all the latest developments. The lineup:
** Tony Blankley, editorial page editor of The Washington Times
** Mark Steyn, conservative author and commentator
** Tony Coehlo, former Democratic congressman/chairman of Al Gore’s 2000 presidential campaign
Ken Mehlman, Chairman of the Republican National Committee will also be joining us.
Rove Upbeat
As I wrote in my latest column, the polls have been absolutely devastating for the GOP since the Foley scandal broke. One pollster after another is saying that Republicans are on course to lose the House while the GOP Senate hangs by a thread.
Karl Rove disagrees.
I'm confident we're going to keep the Senate; I'm confident we're going to keep the House. The Foley matter has impact in some limited districts, but the research we have shows that people are differentiating between a vote for their congressman and a member from Florida…It is useful to remind people what [Democrats] said and what they do. I think they have given us here, especially in the last couple of weeks, a potent set of votes to talk about. You had 90 percent of House Democrats voting against the terrorist-surveillance program, nearly three-quarters of Senate Democrats and 80 percent of House Democrats voting against the terrorist-interrogation act. Something is fundamentally flawed.
Karl Rove disagrees.
I'm confident we're going to keep the Senate; I'm confident we're going to keep the House. The Foley matter has impact in some limited districts, but the research we have shows that people are differentiating between a vote for their congressman and a member from Florida…It is useful to remind people what [Democrats] said and what they do. I think they have given us here, especially in the last couple of weeks, a potent set of votes to talk about. You had 90 percent of House Democrats voting against the terrorist-surveillance program, nearly three-quarters of Senate Democrats and 80 percent of House Democrats voting against the terrorist-interrogation act. Something is fundamentally flawed.
Kudlow's $tock Club
Here are last night’ stock picks from Robert Costomiris. He's a senior portfolio manager at Wells Fargo, where he manages the five-star Morningstar-rated Wells Fargo Advantage Mid Cap Discipline Fund (SMCDX). He’s up an exceptional 13.2 percent year to date—that’s an impressive 400 basis points above the S&P.Mr. Costomiris believes the trick for this market is to go where other people aren't going. He looks for the “untold stories” and buys high-quality companies that are out of favor with analysts.
His picks:
Kroger (KR): “The first untold story is Kroger. It's obviously the largest grocer in the country. 40 percent of consumers have to shop there week after week, regardless of the economy. They've got the best management in the industry. How do we know this? They obsess about long-term competitive sustainable advantage. They reinvest in the business.”
Hanover Compressor (HC): “One of the best-performing energy companies in the last year. [It’s overlooked] because it's boring. What they do is they lease compression equipment to natural gas pipelines. Very steady-eddy business. They redeploy capital into faster growing geographies.”
Ohio Casualty (OCAS): “It’s a financial company—obviously a Midwest property and casualty insurer. Just went through an arduous but successful three-year turnaround. And the Street is assigning it a 10 PE.”
Pall Corp (PLL): “This is an industrial company, but not your father's industrial company. 75 percent of its sales are replacement filters to manufacturing companies worldwide. They sell filters to manufacturing companies that filter air, gas, liquids, water, etc. Very steady-eddy, high returning, free cash flow story.”
Millipore (MIL): “This is a sneaky biotechnology play. Millipore owns the technology to sell consumables in a monocotyl antibody-derived drug manufacturing and biotechnology. They hired a new CEO in the last year and a half to take the company to a new level. He's cutting costs and redeploying assets into faster-growing strategic opportunities, including smart acquisitions. The nice thing about this is that they are diverse companies, so they're selling into the Genentech. They're selling into all the big biotechnology companies. They're not dependent on one drug. Their single biggest drug is probably one of Genentech's big drugs, and it's about 3 percent of sales.”
Tuesday, October 17, 2006
JFK the Supply-Sider
"Our true choice is not between tax reduction, on the one hand, and the avoidance of large federal deficits on the other...[A]n economy hampered by restrictive tax rates will never produce enough jobs or enough profits...It is a paradoxical truth that tax rates are too high today and tax revenues are too low, and the soundest way to raise revenues in the long run is to cut rates now." - Democratic President John F. Kennedy in a December 14, 1962 speech at the Economic Club of New York.(Note: After JFK cut taxes across the board, the inflation-adjusted economy expanded by more than 42 percent over the next seven years. The icing on the cake? During that same period, federal revenues climbed from $94 billion in 1961 to $153 billion in 1968, an increase of 62 percent (33 percent after adjusting for inflation). History is clear - tax cuts do not result in revenue cuts. As we discovered in 1961, 1981, 1997 and 2003, cutting taxes actually increases revenues. Today's tax-loving Dems might want to take a page out of JFK's playbook...)
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll begin tonight's show with our stock market/economic panel to address the latest news and developments. Our group includes:
** Don Luskin, Chief Investment Officer for Trend Macrolytics
** J.J. Burns, President of JJ Burns & Company
** Joe LaVorgna, Chief US Fixed Income Economist at Deutsche Bank
Robert J. Costomiris, 5-star Morningstar rated manager of the Wells Fargo Advantage Mid Cap Disciplined Fund, will offer his stock selections on Kudlow's Stock Club.
A look at the latest midterm election developments with The Washington Post's Chris Cillizza and Larry Sabato, University of Virginia political scientist.
A Washington to Wall Street debate between Kevin Hassett, director of economic-policy studies at the American Enterprise Institute and Dean Baker, co-director of the Center for Economic and Policy Research.
Class Warfare, Pay-Go, and the Democratic DNA
Most supply-siders and conservative pundits believe that if the Dems manage to take the House and Senate, President Bush’s investor tax cuts will be safe because they have been extended to 2010.
Folks also think President Bush will veto any tax hike legislation that a new Democratic Congress might pass. Yes, yes, I believe Bush would definitely veto a direct tax hike bill. But the political story will be much more complicated than this.
Because if a Democratic Congress passes new “pay-as-you-go” rules, then the tax cuts will be severely jeopardized.
A revenue-oriented Pay-Go would show the static revenue loss each year that is scored by the Congressional Budget Office. This means that Harry Reid, Nancy Pelosi, Charlie Rangel, John Spratt and other Dems would be able to craft a so-called big bang deficit reduction package that would (falsely) cobble together spending cuts with tax revenue hikes.
President Bush might eventually be confronted with a Hobbesian choice of vetoing a so-called $500 billion dollar deficit reduction package that would overturn and rollback cap gains, dividends and the top income tax rate.
Inside the DNA of the Democratic party remains an obsessive desire to raise the income tax rate back to President Clinton’s 39.6 percent. There exists a class warfare mentality that seeks to tax and penalize the rich. It is an obsessive, biological instinct to soak American success stories as some kind of Soviet style income leveling exercise that is supposed to make the non-rich feel better.
This is all nonsense—typical liberal left-wing pabulum.
The key point here is that Bush’s tax cuts have done an amazing job in reigniting the U.S. economy. The 2003 tax cuts rallied the stock market, generated 6 ½ million new jobs, and have paid for themselves with soaring revenues that have, in turn, plunged the deficit. But this is all in jeopardy because of the potential of new pay-go rules.
I’ve checked with OMB budget officials on this. They confirm my green eyeshade memory from the days when I was President Reagan’s associate budget director. Unfortunately, bad habits and bad thoughts have long shelf lives.
So, let me warn my fellow conservative friends and the investor class: a Democratic sweep come November will put Bush’s hugely successful tax cuts front and center on the chopping block.
It’s a sobering thought.
Folks also think President Bush will veto any tax hike legislation that a new Democratic Congress might pass. Yes, yes, I believe Bush would definitely veto a direct tax hike bill. But the political story will be much more complicated than this.
Because if a Democratic Congress passes new “pay-as-you-go” rules, then the tax cuts will be severely jeopardized.
A revenue-oriented Pay-Go would show the static revenue loss each year that is scored by the Congressional Budget Office. This means that Harry Reid, Nancy Pelosi, Charlie Rangel, John Spratt and other Dems would be able to craft a so-called big bang deficit reduction package that would (falsely) cobble together spending cuts with tax revenue hikes.
President Bush might eventually be confronted with a Hobbesian choice of vetoing a so-called $500 billion dollar deficit reduction package that would overturn and rollback cap gains, dividends and the top income tax rate.
Inside the DNA of the Democratic party remains an obsessive desire to raise the income tax rate back to President Clinton’s 39.6 percent. There exists a class warfare mentality that seeks to tax and penalize the rich. It is an obsessive, biological instinct to soak American success stories as some kind of Soviet style income leveling exercise that is supposed to make the non-rich feel better.
This is all nonsense—typical liberal left-wing pabulum.
The key point here is that Bush’s tax cuts have done an amazing job in reigniting the U.S. economy. The 2003 tax cuts rallied the stock market, generated 6 ½ million new jobs, and have paid for themselves with soaring revenues that have, in turn, plunged the deficit. But this is all in jeopardy because of the potential of new pay-go rules.
I’ve checked with OMB budget officials on this. They confirm my green eyeshade memory from the days when I was President Reagan’s associate budget director. Unfortunately, bad habits and bad thoughts have long shelf lives.
So, let me warn my fellow conservative friends and the investor class: a Democratic sweep come November will put Bush’s hugely successful tax cuts front and center on the chopping block.
It’s a sobering thought.
Quelle Surpris!
Americans have no interest in becoming France according to Kevin Hassett:Rather than provide voters with a new agenda that reflects a willingness to change, Pelosi's agenda is simply a laundry list of the Democrats' most economically questionable proposals from days gone by.
...Democrats have been on such a political losing streak for so long because Americans have grown to respect the free-market system. They recognize that capitalism emerged victorious from the struggle with communism because markets work far better than bureaucrats. They see the prosperity all around them, and recognize that it came about because we are still one of the freest economies on earth.
Pelosi and her ilk believe that they lost in the past because they didn't adequately convince Americans with their near-socialist rhetoric.
My guess is that they are wrong, and that Americans who are tired of the Iraq war and the Mark Foley scandal are not so tired that they want to become France.
As the bad polls have piled up in recent weeks, the only comfort for Republicans has been the notion that Democrats have consistently exhibited an impressive ability to snatch defeat from the jaws of victory. If voters take a look at the Pelosi agenda, then the Democrats might well have done it again.
(Tune in to Kudlow & Company this evening where Mr. Hassett will further expound upon these "near socialist" Dems...)
Monday, October 16, 2006
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.On tonight's show:
A stock market/economy discussion with:
** Joe LaVorgna, Chief US Fixed Income Economist at Deutsche Bank
** Michelle Girard, senior economist at RBS Greenwich Capital
** John Augustine, Chief Investment Strategist at Fifth Third Asset Management
300,000,000 Americans...a census debate between Jared Bernstein, senior economist at the Economic Policy Institute and the Wall Street Journal's Kim Strassel.
BAD NEWS BEARS...How the MSM Distorts a Good Economy and Batters President Bush. On to dicuss are Brent Bozell, founder and President of the Media Research Center and Mark Weisbrot, Co-Director of the Center for Economic and Policy Research
An Iraq debate between Dan Goure, defense analyst with the Lexington Institute and President Clinton’s former national security aide, PJ Crowley.
And finally, a look at the latest political developments with independent pollster John Zogby, syndicated columnist Deroy Murdoch and Craig Crawford, columnist for Congressional Quarterly.
The Midterms
Some observations:
** John J. Miller—National Review’s national political reporter, puts two more Senate seats (Montana and Ohio) into the Democratic column.
** The New York Times’ Adam Nagourney is talking about the GOP giving up on Ohio’s Sen. Mike DeWine.
** TradeSports.com has the House GOP 2006 contract down to 32 percent—not looking good at all. The last Senate contract has dipped under 70.
**RealClearPolitics’ Jay Cost believes the House will go Democratic; but we don’t know if it’ll be 15 or 30 seats—that makes a big difference according to his statistical analysis.
** On Meet the Press yesterday, Rep. Mark Kennedy (R-MN) did a lousy job defending Bush’s tax cuts, economic growth, soaring revenues and the plunging budget deficit in his debate against Amy Klobuchar (D). The Minnesota Senate race is not looking good for the GOP.
** Economist Kevin Hassett correctly argues that the Democratic agenda is more of the same old, same old—tax the rich, class warfare and the minimum wage.
My thought: the Dems may in fact carry Congress; but if the Republicans return to their foundation, come together and retool their message, 2008 will be a far brighter year.
** John J. Miller—National Review’s national political reporter, puts two more Senate seats (Montana and Ohio) into the Democratic column.
** The New York Times’ Adam Nagourney is talking about the GOP giving up on Ohio’s Sen. Mike DeWine.
** TradeSports.com has the House GOP 2006 contract down to 32 percent—not looking good at all. The last Senate contract has dipped under 70.
**RealClearPolitics’ Jay Cost believes the House will go Democratic; but we don’t know if it’ll be 15 or 30 seats—that makes a big difference according to his statistical analysis.
** On Meet the Press yesterday, Rep. Mark Kennedy (R-MN) did a lousy job defending Bush’s tax cuts, economic growth, soaring revenues and the plunging budget deficit in his debate against Amy Klobuchar (D). The Minnesota Senate race is not looking good for the GOP.
** Economist Kevin Hassett correctly argues that the Democratic agenda is more of the same old, same old—tax the rich, class warfare and the minimum wage.
My thought: the Dems may in fact carry Congress; but if the Republicans return to their foundation, come together and retool their message, 2008 will be a far brighter year.
Mr. Hastert, Move Out of the Way
The first wave of polls following the Mark Foley scandal is devastating to the Republican outlook for the congressional elections on November 7. Devastating.
The Foley scandal -- and the corresponding bungling of the works by House Speaker Denny Hastert -- is not the biggest issue in the midterm races. But at the margin it is having a very negative impact. One might even call this a tipping point. Metaphorically, it highlights the ongoing GOP problems of corruption, ineptness, mismanagement, and poor judgment.
Whether it’s Gallup, ABC/Washington Post, CBS/New York Times, or CNN/USA Today, the polls are all telling the same story: The Republicans are on course to lose the House while the GOP Senate is hanging by a thread.
According to Gallup, government corruption has climbed to the upper ranks of key voter issues, joining Iraq and terrorism. This is exactly where the GOP doesn’t want it to be. Undoubtedly, these new numbers capture a loss of Republican support among security moms and what we can call conservative values voters.
A full 48 percent of likely voters rate corruption among the big-three issues of the day, while the GOP specifically is losing by 20 points on corruption, 17 points on Iraq and, get this, 5 points on terrorism. This last one is tough to swallow, but the damage has been done.
Among likely voters, Gallup shows the Democrats with a 23-point lead, 59-36, for the generic House ballot. Only a month ago, this indicator was locked at 48-48. In addition, respondents say Speaker Hastert should resign, by a 43 to 36 percent margin.
If I were Denny Hastert I would try to be as invisible as possible right about now. Instead, Hastert is holding news conferences in front of graveyard tombstones. Message to Mr. Hastert: The polls are calling for your head. The more you try to explain your way out of the Foley mess the more you crowd out important Republican messages on low-tax economic growth, falling gas prices, the record Dow stock market, and a strong national-security stance against terrorism. These are the messages the GOP must emphasize if it is to stay competitive in the final sprint to the November 7 elections.
Hastert should have stepped aside as speaker more than a week ago, telling voters that he will roll up his sleeves and get to the bottom of the Foley sex scandal in the months ahead. Instead he is making the political problem worse. Every time he appears in public he not only reminds voters of GOP corruption, but of the fact he has done nothing about it.
Jim Colby, the openly gay Republican congressman from Arizona, says Foley’s predatory sexual harassment started in 2001. Kirk Fordham, former staffer to Republican Rep. Tom Reynolds of New York, traces it back to 2003. Republican House member John Shimkus says it began a year ago, although he didn’t bother to tell anybody on the Page Board. And Reynolds himself says the problem was fingered last spring. That’s more than an enough anecdotal evidence for voters who have concluded that Hastert knew there was a problem and stood idly by. At the very least, common sense says Hastert should have removed Foley from his leadership positions on the Page Board and the House Caucus on Missing and Exploited Children.
Republicans will get their comeuppance this fall. But the trick for the GOP is to turn this short-run political setback into a long-run positive strategy. The starting point must be a change in the House leadership and a retooling of a tired old message.
In fact, to a good extent it has been a message of failure.
Hastert & Co. failed to abolish the cash-for-legislative-favors scam of budget earmarks running amok. They failed to put in clear rules to curb budgetary spending. They struck out on Social Security reform and savings-account expansion. They did extend the investor tax cuts, but they failed to reform either the corporate or personal tax codes, where wholesale changes could boost worker incomes and lessen wage inequality. (The corporate tax should be abolished altogether.) The bust-the-bank prescription-drug plan had Hastert’s fingerprints all over it. Ditto for the congressional slide toward trade protectionism. Ditto for a 700-mile fence between the U.S. and Mexico. Rather than true immigration reform, we have the Buchanan-Tancredo hate-line on immigration -- a.k.a., a national election loser.
The single strongest most-likely Republican voter bloc is the investor class, where shareholders should be encouraged to get out and vote for tax cuts, limited government, a strong economy, and a roaring stock market. It’s not too late to mobilize this group and at least shave the Democratic vote margin on November 7. But it takes a message to motivate voters.
Mr. Hastert, move out of the way. It’s time for change.
The Foley scandal -- and the corresponding bungling of the works by House Speaker Denny Hastert -- is not the biggest issue in the midterm races. But at the margin it is having a very negative impact. One might even call this a tipping point. Metaphorically, it highlights the ongoing GOP problems of corruption, ineptness, mismanagement, and poor judgment.
Whether it’s Gallup, ABC/Washington Post, CBS/New York Times, or CNN/USA Today, the polls are all telling the same story: The Republicans are on course to lose the House while the GOP Senate is hanging by a thread.
According to Gallup, government corruption has climbed to the upper ranks of key voter issues, joining Iraq and terrorism. This is exactly where the GOP doesn’t want it to be. Undoubtedly, these new numbers capture a loss of Republican support among security moms and what we can call conservative values voters.
A full 48 percent of likely voters rate corruption among the big-three issues of the day, while the GOP specifically is losing by 20 points on corruption, 17 points on Iraq and, get this, 5 points on terrorism. This last one is tough to swallow, but the damage has been done.
Among likely voters, Gallup shows the Democrats with a 23-point lead, 59-36, for the generic House ballot. Only a month ago, this indicator was locked at 48-48. In addition, respondents say Speaker Hastert should resign, by a 43 to 36 percent margin.
If I were Denny Hastert I would try to be as invisible as possible right about now. Instead, Hastert is holding news conferences in front of graveyard tombstones. Message to Mr. Hastert: The polls are calling for your head. The more you try to explain your way out of the Foley mess the more you crowd out important Republican messages on low-tax economic growth, falling gas prices, the record Dow stock market, and a strong national-security stance against terrorism. These are the messages the GOP must emphasize if it is to stay competitive in the final sprint to the November 7 elections.
Hastert should have stepped aside as speaker more than a week ago, telling voters that he will roll up his sleeves and get to the bottom of the Foley sex scandal in the months ahead. Instead he is making the political problem worse. Every time he appears in public he not only reminds voters of GOP corruption, but of the fact he has done nothing about it.
Jim Colby, the openly gay Republican congressman from Arizona, says Foley’s predatory sexual harassment started in 2001. Kirk Fordham, former staffer to Republican Rep. Tom Reynolds of New York, traces it back to 2003. Republican House member John Shimkus says it began a year ago, although he didn’t bother to tell anybody on the Page Board. And Reynolds himself says the problem was fingered last spring. That’s more than an enough anecdotal evidence for voters who have concluded that Hastert knew there was a problem and stood idly by. At the very least, common sense says Hastert should have removed Foley from his leadership positions on the Page Board and the House Caucus on Missing and Exploited Children.
Republicans will get their comeuppance this fall. But the trick for the GOP is to turn this short-run political setback into a long-run positive strategy. The starting point must be a change in the House leadership and a retooling of a tired old message.
In fact, to a good extent it has been a message of failure.
Hastert & Co. failed to abolish the cash-for-legislative-favors scam of budget earmarks running amok. They failed to put in clear rules to curb budgetary spending. They struck out on Social Security reform and savings-account expansion. They did extend the investor tax cuts, but they failed to reform either the corporate or personal tax codes, where wholesale changes could boost worker incomes and lessen wage inequality. (The corporate tax should be abolished altogether.) The bust-the-bank prescription-drug plan had Hastert’s fingerprints all over it. Ditto for the congressional slide toward trade protectionism. Ditto for a 700-mile fence between the U.S. and Mexico. Rather than true immigration reform, we have the Buchanan-Tancredo hate-line on immigration -- a.k.a., a national election loser.
The single strongest most-likely Republican voter bloc is the investor class, where shareholders should be encouraged to get out and vote for tax cuts, limited government, a strong economy, and a roaring stock market. It’s not too late to mobilize this group and at least shave the Democratic vote margin on November 7. But it takes a message to motivate voters.
Mr. Hastert, move out of the way. It’s time for change.
Friday, October 13, 2006
The Pooh-Poohers
...No conservative who understand what conservatism is would argue that human failings aren’t well distributed across the political and ideological landscape. The question is how we as individuals and institutions respond to them. The liberal-Democratic position seems to be that personal sins are never relevant, except for the sin of hypocrisy. So Republicans who stand by a moral standard can be condemned for not living up to it, while liberals who pooh-pooh such standards never can be. As Howard Dean explained not long ago, “Everybody has ethical shortcomings. We ought not to lecture each other about our ethical shortcomings. . . .I will use whatever position I have in order to root out hypocrisy.” What a convenient principle.
- Jonah Goldberg writing in National Review magazine, 10/23/06
- Jonah Goldberg writing in National Review magazine, 10/23/06
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll begin tonight's show by diving into the surging stock market and Goldilocks economy. On the docket tonight: GDP, inflation, unemployment, consumer confidence, the Fed funds rate and more...
On board to help us make sense of all this:
** Art Laffer, supply-sider extraordinaire and Founder/CEO of Laffer Associates.
** Gail Fosler, chief economist at the Conference Board
** Jeffrey Kleintop, chief investment strategist at PNC Advisors
Kudlow's Stock Club: Charles Norton, four-star Morningstar rated co-portfolio manager of the Vice Fund and principal at GNI Capital will offer his stock selections.
YOUR MONEY, YOUR VOTE...Things are heating up bigtime with less than a month until election day. Our political guests will weigh in with their take as the day of reckoning draws near:
** Sidney Blumenthal, author/former Clinton senior advisor
** Bill Press, Democratic strategist/political commentator
** Joel Mowbray, author/synicated columnist
** Kellyanne Conway, GOP strategist/president of The Polling Company
An interview with Sen. Jim DeMint (R-SC) to discuss the security bill, ports and the anti-online gambling provision.
Steyn on National Security
(A small portion of Mark Steyn's recent interview with NRO's Kathryn Lopez about his new book America Alone).
Kathryn Lopez: Could which party wins in the November congressional elections change the course of history?
Mark Steyn: I think so. A vote for the Democratic party is basically a vote to return to Bill Clinton’s holiday-from-history. It would be nice if the Dems were full of Joe Lieberman types who are serious about national security or even Joe Biden types who at least talk in a portentous voice and pretend to be serious about national security. But you know that Peter Beinart book? “Why Liberals — And Only Liberals — Can Win The War On Terror”? If that’s true, we’re all doomed. It’s like publishing a book in 1942 called “Why Swedes — And Only Swedes — Can Win The Second World War.” The truth is 99.99 percent of them have got zero interest in getting in the game. They want to return to the Nineties when politics was about new Federal regulations for mandatory bicycling helmets, or whatever the hell Bill Clinton’s “legacy” is. I understand why, if you’re the proverbial soccer mom or John Edwards’ Dickensian shivering coatless girl, a bunch of nuclear mullahs doesn’t seem terribly relevant to your life. But what I try to do in America Alone is connect up the war and the big macro-trends with the home front. The fact is the assumption at the heart of Democratic-party thinking is that the natural destination of every advanced democracy is Scandinavia and that America’s just taking a little longer to get there than the Europeans. That kind of thinking is what’s done for Europe: it’s resulted in unaffordable welfare structures on declining human capital. In the end, Big Government is a national security threat. A vote for Nancy Pelosi — and don’t get me wrong; unlike many of my NR chums, I find her an oddly attractive woman — but a vote for Nancy Pelosi is a vote for the same complacency that’s killing the rest of the West.
Kathryn Lopez: Could which party wins in the November congressional elections change the course of history?
Mark Steyn: I think so. A vote for the Democratic party is basically a vote to return to Bill Clinton’s holiday-from-history. It would be nice if the Dems were full of Joe Lieberman types who are serious about national security or even Joe Biden types who at least talk in a portentous voice and pretend to be serious about national security. But you know that Peter Beinart book? “Why Liberals — And Only Liberals — Can Win The War On Terror”? If that’s true, we’re all doomed. It’s like publishing a book in 1942 called “Why Swedes — And Only Swedes — Can Win The Second World War.” The truth is 99.99 percent of them have got zero interest in getting in the game. They want to return to the Nineties when politics was about new Federal regulations for mandatory bicycling helmets, or whatever the hell Bill Clinton’s “legacy” is. I understand why, if you’re the proverbial soccer mom or John Edwards’ Dickensian shivering coatless girl, a bunch of nuclear mullahs doesn’t seem terribly relevant to your life. But what I try to do in America Alone is connect up the war and the big macro-trends with the home front. The fact is the assumption at the heart of Democratic-party thinking is that the natural destination of every advanced democracy is Scandinavia and that America’s just taking a little longer to get there than the Europeans. That kind of thinking is what’s done for Europe: it’s resulted in unaffordable welfare structures on declining human capital. In the end, Big Government is a national security threat. A vote for Nancy Pelosi — and don’t get me wrong; unlike many of my NR chums, I find her an oddly attractive woman — but a vote for Nancy Pelosi is a vote for the same complacency that’s killing the rest of the West.
Stop Punishing Success
We had a rather lively economic discussion on last night's show. Here's a portion of that exchange between Gary Gensler, former Treasury undersecretary under Bill Clinton; Jim Glassman, senior fellow at the American Enterprise Institute/host of TechCentralStation.com and yours truly.JIM GLASSMAN: What I was going to say, Larry, is that I agree with Gary. There is a lot of anxiety. But that anxiety is not going to be relieved by politicians. It is the result of globalization which, in general, is very, very good for the United States and for most of the people who live here. People are anxious about their jobs—there's no doubt about that. But really that’s a kind of a personal anxiety which can be relieved by getting better education, really increasing their skills, that sort of thing. It’s not a policy question.
GARY GENSLER: Well they also feel anxious that they haven't they haven't participated fully in these tax cuts. They see health care costs going up...
JIM GLASSMAN: Oh, Gary, come on. Look. Half of Americans pay zippo in taxes, all right? The bottom half of Americans pay nothing in taxes. You know this as well as I do.
GARY GENSLER: But who got the biggest tax cuts? They were people like you and me, Jim.
KUDLOW: So why that is bad? No, no. Wait a second. Wait a second.
GARY GENSLER: Larry, it's good for my kids; it's good for my family.
KUDLOW: Why is that bad? Why is that bad? See, I want to understand this. Look, raising taxes on the most successful in society makes no sense. These are the people who took risks, work harder, made entrepreneurial decisions and succeeded. And now they are paying a record share of taxes. But if you raise their tax rates and punish their hard work and success, how does that help the people who are legitimately concerned in the middle? How does jacking up taxes at the top help people in the middle? That is social policy. That is not economic policy.
Thursday, October 12, 2006
Offer Carrots, Threaten Sticks
If China can go capitalist, and if Russia can go capitalist, and if Eastern Europe and India can go capitalist (heck, if Rhode Island can go capitalist—illustrated by their new flat tax reform plan) then you have just got to believe there’s a way to spur North Korea toward capitalism too.
I know, I know, it’s an absurd idea. But so were China, Russia and Rhode Island.
On last night’s Kudlow & Company, national security expert Thomas Barnett argued that China is the pivotal key to resolving the North Korea crisis. He urged the U.S. to make a deal with the Chinese in order to put the kibosh on Kim Jong-il’s nuclear development. I completely agree.
But we must go further: We need to offer carrots and sticks on capitalism as well as non- proliferation.
Yes, the U.S. and China must work together to develop an economic sanctions program that insists North Korea dismantles its nukes under U.N. inspection.
But, additionally, the deal should insist that North Korea takes definitive steps toward liberalizing their economy. Without de-nuclearizing their weapons and opening up their economy, the great powers will cut off their energy, food, and cash.
However, in return for de-nuclearizing and allowing greater economic freedom, it should be made clear that North Korea will be rewarded. In other words, threaten punishment and offer incentives. Be hard-minded and use diplomacy, but include carrots to accompany the sticks.
North Korea needs to steal a page out of China’s playbook from thirty years ago, when the Chinese government finally allowed farm peasants some ownership of their land. Follow China’s lead and allow foreign investment and private ownership of businesses. Poor, famished North Koreans resigned to eating bark off trees would go for this in a big way—just like the starving Chinese peasants did three decades ago.
Whatever happens to Kim Jong-il will happen. But I still believe—hope against hope—that Milton Friedman’s idea that open market capitalism is a precursor to free political reform. Friedman’s idea could work even in such a dark, despotic place as modern-day North Korea.
The smallest crumb of economic freedom would represent a giant step in reforming what ails North Korea. One day, in the not-so-distant future, encouraging such a course of action might even connect them to the world economy.
Tom Barnett’s approach makes sense. We have to make a deal with China. Economic and trade liberalization must form the foundation of any nuke stopping deal.
In the end, cutting off all their food and energy will only starve more North Koreans. It would only make matters worse, ultimately forcing a more dangerous rupture that might play into Kim’s hands. Such instability would almost surely lead to an even more adventurous militaristic response from their leader.
Is there no way to tame this beast through economic reform?
I know, I know, it’s an absurd idea. But so were China, Russia and Rhode Island.
On last night’s Kudlow & Company, national security expert Thomas Barnett argued that China is the pivotal key to resolving the North Korea crisis. He urged the U.S. to make a deal with the Chinese in order to put the kibosh on Kim Jong-il’s nuclear development. I completely agree.
But we must go further: We need to offer carrots and sticks on capitalism as well as non- proliferation.
Yes, the U.S. and China must work together to develop an economic sanctions program that insists North Korea dismantles its nukes under U.N. inspection.
But, additionally, the deal should insist that North Korea takes definitive steps toward liberalizing their economy. Without de-nuclearizing their weapons and opening up their economy, the great powers will cut off their energy, food, and cash.
However, in return for de-nuclearizing and allowing greater economic freedom, it should be made clear that North Korea will be rewarded. In other words, threaten punishment and offer incentives. Be hard-minded and use diplomacy, but include carrots to accompany the sticks.
North Korea needs to steal a page out of China’s playbook from thirty years ago, when the Chinese government finally allowed farm peasants some ownership of their land. Follow China’s lead and allow foreign investment and private ownership of businesses. Poor, famished North Koreans resigned to eating bark off trees would go for this in a big way—just like the starving Chinese peasants did three decades ago.
Whatever happens to Kim Jong-il will happen. But I still believe—hope against hope—that Milton Friedman’s idea that open market capitalism is a precursor to free political reform. Friedman’s idea could work even in such a dark, despotic place as modern-day North Korea.
The smallest crumb of economic freedom would represent a giant step in reforming what ails North Korea. One day, in the not-so-distant future, encouraging such a course of action might even connect them to the world economy.
Tom Barnett’s approach makes sense. We have to make a deal with China. Economic and trade liberalization must form the foundation of any nuke stopping deal.
In the end, cutting off all their food and energy will only starve more North Koreans. It would only make matters worse, ultimately forcing a more dangerous rupture that might play into Kim’s hands. Such instability would almost surely lead to an even more adventurous militaristic response from their leader.
Is there no way to tame this beast through economic reform?
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll kick off tonight's program with a look at the surging stock market and Goldilocks economy. Our guests include:
** Gary Gensler, former Treasury undersecretary
** Herb Greenberg, senior MarketWatch columnist
** Jim Glassman, senior fellow at the American Enterprise Institute and host of TechCentralStation.com
A look at the Battle for Mark Foley's Florida Seat...Democratic hopeful Tim Mahoney will be on board as will Rep. Joe Negron, the GOP's replacement for the vacant congressional seat.
An Iraq debate between Jed Babbin, former Deputy Undersecretary of Defense and PJ Crowley, former national security advisor to Bill Clinton.
And finally, a look at politics and what's ahead in the midterm elections with Larry Sabato, UVA Center for Politics Director and James Pethokoukis, writer from US News & World Report.
Hang it Around Their Necks
Jed Babbin has a few words for Dems trying to pin Kim Jong-il's bomb on Bush:
The architects of the Carter-Clinton failed 1994 "Agreed Framework" deal with North Korea are out blaming President Bush for its failure. In Wednesday's New York Times, former president Carter wrote that the failure of his 1994 deal was caused by President Bush labeling North Korea part of the "axis of evil" in 2002. Carter's statement doesn't withstand even the slightest analysis. On April 24, 2003, in Beijing talks with Chinese and American representatives, North Korean representatives declared that their nation possessed nuclear weapons. In 2004, Defense Intelligence Agency experts reportedly said that North Korea had between four and eight plutonium bombs. By Carter's analysis, that would mean the North Koreans stopped their nuclear weapons development for eight years, recommenced it in 2002 and in less than two years had managed to produce several weapons. His claim is risible.
...Carter's assignment of blame to Bush, like Clinton's wail that he tried to get bin Laden and failed but Bush didn't try, should be broadcast over and over across the nation. The Democrats' approach to every foreign threat never varies, nor does its result. From Vietnam to pre-9-11 bin Laden, the Dems track record is something campaign ads could hang around their necks like the Old Mariner's albatross....
The architects of the Carter-Clinton failed 1994 "Agreed Framework" deal with North Korea are out blaming President Bush for its failure. In Wednesday's New York Times, former president Carter wrote that the failure of his 1994 deal was caused by President Bush labeling North Korea part of the "axis of evil" in 2002. Carter's statement doesn't withstand even the slightest analysis. On April 24, 2003, in Beijing talks with Chinese and American representatives, North Korean representatives declared that their nation possessed nuclear weapons. In 2004, Defense Intelligence Agency experts reportedly said that North Korea had between four and eight plutonium bombs. By Carter's analysis, that would mean the North Koreans stopped their nuclear weapons development for eight years, recommenced it in 2002 and in less than two years had managed to produce several weapons. His claim is risible.
...Carter's assignment of blame to Bush, like Clinton's wail that he tried to get bin Laden and failed but Bush didn't try, should be broadcast over and over across the nation. The Democrats' approach to every foreign threat never varies, nor does its result. From Vietnam to pre-9-11 bin Laden, the Dems track record is something campaign ads could hang around their necks like the Old Mariner's albatross....
Wednesday, October 11, 2006
Harry "Holier Than Thou" Reid
From AP:Senate Democratic Leader Harry Reid collected a $1.1 million windfall on a Las Vegas land sale even though he hadn't personally owned the property for three years, property deeds show.
In the process, Reid did not disclose to Congress an earlier sale in which he transferred his land to a company created by a friend and took a financial stake in that company, according to records and interviews.
The Nevada Democrat's deal was engineered by Jay Brown, a longtime friend and former casino lawyer whose name surfaced in a major political bribery trial this summer and in other prior organized crime investigations.
...In 2001, Reid sold the land for the same price to a limited liability corporation created by Brown. The senator didn't disclose the sale on his annual public ethics report or tell Congress he had any stake in Brown's company. He continued to report to Congress that he personally owned the land.
...Reid hung up the phone when questioned about the deal during an AP interview last week.
...Senate ethics rules require lawmakers to disclose on their annual ethics report all transactions involving investment properties _ regardless of profit or loss _ and to report any ownership stake in companies.
Kent Cooper, who oversaw government disclosure reports for federal candidates for two decades in the Federal Election Commission, said Reid's failure to report the 2001 sale and his ties to Brown's company violated Senate rules.
"This is very, very clear," Cooper said. "Whether you make a profit or a loss you've got to put that transaction down so the public, voters, can see exactly what kind of money is moving to or from a member of Congress"....
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening."YOUR MONEY, YOUR VOTE"
Our Dynamic Duo of former labor secretary Robert Reich and The Wall Street Journal's Steve Moore will battle it out on the economy, Bush's press conference today, the shrinking budget deficit and more.
Commerce Secretary Carlos Gutierrez will offer his perspective in a one-on-one interview.
A national security/foreign policy debate. Our guests include:
* Peter Beinart, editor-at-large at The New Republic
* Tom Barnett, national security affairs expert and author of "The Pentagon's New Map"
* David Ignatius, international affairs columnist at The Washington Post
A look at whether President Bush is making the sale on the economy and national security with liberal political commentator Bill Press and conservative author David Limbaugh.
And finally, we'll take a look at the markets with Dr. Irwin Kellner, chief economist for MarketWatch and Michael Pento, Senior Market Strategist at Delta Global Advisors.
Something to Crow About
President Bush got himself and the Republican party back on message today in his Rose Garden news conference by saying, “the numbers are proof that pro-growth economic polices work by restraining spending in Washington and allowing Americans to keep more of what they earn.”
He was citing the federal budget deficit drop to $248 billion for fiscal 2006, the smallest in four years, and less than 2 percent of GDP. At lower tax rates, the economy is expanding and revenues are soaring. Bush believes that the GOP can still hold Congress if they focus on the economy and national security.
I don’t know if he made the sale to the electorate, but it was certainly better than what Dennis Hastert had to say yesterday in his goofy news conference in front of a graveyard in Illinois.
Perhaps Mr. Hastert feels connected to that graveyard, I don’t know. But instead of talking about the botched management of Mark Foley’s predatory sexual practices, Mr. Bush correctly moved to erase Hastert’s political image and get the GOP back on message.
Of course, there are big problems in Iraq, Iran and North Korea. And quite frankly, I’m really not 100 percent certain exactly what American foreign policy is in those areas. What I do know is that the economy is still the greatest story never told. And Mr. Bush is correctly urging Republicans to tell the story.
The Dow Jones today climbed back from a 30-point loss following Bush’s press conference. And recent economic reports on retail sales, manufacturing, services and jobs reveal that the economy is still on solid ground. What’s more, gas prices continue to ease at the pump.
The 100 million strong investor class may turn out to vote in higher than usual numbers as their October portfolio statements YTD show a better than 10 percent rise in their holdings.
It may not be the Goldilocks Congress, but the solid economy and stock market is something to crow about.
He was citing the federal budget deficit drop to $248 billion for fiscal 2006, the smallest in four years, and less than 2 percent of GDP. At lower tax rates, the economy is expanding and revenues are soaring. Bush believes that the GOP can still hold Congress if they focus on the economy and national security. I don’t know if he made the sale to the electorate, but it was certainly better than what Dennis Hastert had to say yesterday in his goofy news conference in front of a graveyard in Illinois.
Perhaps Mr. Hastert feels connected to that graveyard, I don’t know. But instead of talking about the botched management of Mark Foley’s predatory sexual practices, Mr. Bush correctly moved to erase Hastert’s political image and get the GOP back on message.
Of course, there are big problems in Iraq, Iran and North Korea. And quite frankly, I’m really not 100 percent certain exactly what American foreign policy is in those areas. What I do know is that the economy is still the greatest story never told. And Mr. Bush is correctly urging Republicans to tell the story.
The Dow Jones today climbed back from a 30-point loss following Bush’s press conference. And recent economic reports on retail sales, manufacturing, services and jobs reveal that the economy is still on solid ground. What’s more, gas prices continue to ease at the pump.
The 100 million strong investor class may turn out to vote in higher than usual numbers as their October portfolio statements YTD show a better than 10 percent rise in their holdings.
It may not be the Goldilocks Congress, but the solid economy and stock market is something to crow about.
Kudlow's $tock Club
(Here are last night's stock picks from David Sowerby, chief market analyst and portfolio manager at Loomis Sayles and Company. Mr. Sowerby manages the four-star Morningstar-rated Loomis Sayles Tax-Managed Fund Fund (LSCGX) - YTD it's up over 10 percent.)Chuck E. Cheese (CEC): "Restaurant stocks look attractive. Chuck E. Cheese is a smaller company on the restaurant side, but doing what I like to see: share repurchases, catalyst for more traffic going through the restaurants. That's a name that I like on the consumer side."
CVS Corp. (CVS): "CVS is a longer-term wealth creator whose stock is down more than 10 percent in the face of the great PR play that Wal-mart has made. But this is affecting CVS only about one script per day in their Florida stores. I think it's a longer-term stock that can grow earnings of 14 to 15 percent. The company raised its guidance today. I'm finding a better entry point to be a buyer of CVS here."
Honeywell (HON): "On the industrial side I think Honeywell looks attractive. Both as a soft defense play, as well as their diversified industrial makeup."
Corning (GLW): "On the technology side, I like the LCD, liquid crystal display demand that's continuing to take place at Corning. The stock was weaker in the summer. But expectations have been raised. The sales have been better, and Corning is a name that I favor."
Zimmer (ZMH): "This is on the health care side. The stock was weaker earlier this year. It's gained traction again as a longer-term wealth creator that I've been able to enter at a more attractive price for the ever-growing demand for orthopedic services."
Tuesday, October 10, 2006
There are no such things as limits to growth, because there are no limits on the human capacity for intelligence, imagination and wonder.- President Ronald Reagan
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll start with a markets and economy debate. Joining us tonight are the following guests:
** Diane Swonk, Chief Economist for Mesirow Financial
** Barry Ritholtz, Chief Market Strategist for Ritholtz Research
** Nouriel Roubini, Economics professor at NYU's Stern School of Business
** Dennis Kneale, Forbes Magazine Managing Editor
Kudlow's Stock Club: David Sowerby, portfolio manager with Loomis Sayles & Co., returns to the show to offer his latest picks. We'll also see how his stock picks from his last appearance fared...
A political discussion with GOP political consultant Jack Burkman; Dr. Frank Luntz of The Luntz Research Companies; and Democratic strategist Julian Epstein.
A Capital vs. Labor debate between Jared Bernstein, senior economist at the Economic Policy Institute and The Wall Street Journal's Kimberley Strassel.
Rough Sailing Ahead for GOP
The first batch of major polls released following the Foley scandal and Speaker Hastert’s mismanagement of this mess has hit the street. They are devastating to the Republican outlook for the Congressional elections on November 7—devastating.
Though the Foley scandal is not the biggest issue in the race, at the margin, it is having a very negative impact; one might even call it a tipping point. Metaphorically, it highlights ongoing GOP problems of corruption, ineptness, mismanagement and poor judgment.
Undoubtedly, these new numbers capture a loss of Republican support among security moms and a loss of energy among conservative values voters. Acccording to the Gallup poll, it has put the issue of government corruption right at the top of the list with Iraq and terrorism—exactly where the GOP doesn’t want it.
48 percent of likely voters rate corruption, Iraq, and terrorism as the big three issues. The GOP is losing by 20 points on corruption, 17 on Iraq and, get this, 5 points on terrorism. (That last one is tough to take, but there you have it.)
Among likely voters, Gallup shows a 23-point lead for the generic House vote, 59-36 for the Dems. Only a month ago, it was a 48-48 tie. In addition, by a 43 to 36 percent margin, respondents say Speaker Hastert should resign.
The CBS News poll shows much of the same. By a 62 to 19 margin, respondents think the Republican leadership knew about Mark Foley’s sexually explicit emails—in other words a cover-up. A few days ago a Rasmussen poll showed 61 percent believed the Republican leadership was protecting Foley; here too reflecting a cover up issue.
(Noteworthy: In his press conference today, Denny Hastert actually used the word “cover-up” for the first time. The Speaker said that if the Foley investigations reveal any evidence of a cover-up, staff heads would roll. A little late Mr. Hastert?)
The CBS poll also shows a 46-26 margin of respondents believing Hastert should resign, while the Congressional vote came in 49 to 35, Dems over Republicans.
Another killer here is that CBS shows the Dems as the party holding the higher moral and ethical ground by 37 to 32 percent. By a two to one margin, respondents viewed the GOP as more corrupt. The Washington Post poll showed similar results.
The Foley scandal net is also widening among specific House races beyond Tom Reynolds up in Buffalo. In Westchester County, New York, Sue Kelly may now be in trouble. She was the Republican chairwoman of the House Page Board from 1998-2001, and may have known about Mark Foley’s lewd behavior during her tenure.
The House GOP 2006 contract form the online betting parlor TradeSports remains considerably lower from its September highs. It’s currently holding around 40 percent, down from 58 percent in the pre-Foley period when President Bush’s national security offensive had momentarily boosted Republican chances.
It is interesting to note that despite all this relentlessly negative news for the GOP, the stock market continues to gain ground. The Dow Jones continues plodding ahead, forging new record highs, while the other indexes also continue to rise.
The market is of course my favorite poll of all. It demonstrates that the outlook for the American economy remains solid. It also suggests that American security remains strong to protect the economy.
The market may also be predicting that a Democratic takeover of Congress will produce no negative legislative action on higher taxes, anti-business regulation, or key foreign policy decisions.
The stock market shrugged off North Korea’s bomb test, the U.S. dollar is trading strong on foreign exchanges, and the price of gold is weak. Perhaps the market is telling us that Republicans will get an election comeuppance, but in the long run, the United States is going to be just fine. I guess this reflects my own view.
The economy, stock market, our security, our democracy, our freedom, our optimistic outlook - it’s all part of the greatest story never told.
Though the Foley scandal is not the biggest issue in the race, at the margin, it is having a very negative impact; one might even call it a tipping point. Metaphorically, it highlights ongoing GOP problems of corruption, ineptness, mismanagement and poor judgment.
Undoubtedly, these new numbers capture a loss of Republican support among security moms and a loss of energy among conservative values voters. Acccording to the Gallup poll, it has put the issue of government corruption right at the top of the list with Iraq and terrorism—exactly where the GOP doesn’t want it.
48 percent of likely voters rate corruption, Iraq, and terrorism as the big three issues. The GOP is losing by 20 points on corruption, 17 on Iraq and, get this, 5 points on terrorism. (That last one is tough to take, but there you have it.)
Among likely voters, Gallup shows a 23-point lead for the generic House vote, 59-36 for the Dems. Only a month ago, it was a 48-48 tie. In addition, by a 43 to 36 percent margin, respondents say Speaker Hastert should resign.
The CBS News poll shows much of the same. By a 62 to 19 margin, respondents think the Republican leadership knew about Mark Foley’s sexually explicit emails—in other words a cover-up. A few days ago a Rasmussen poll showed 61 percent believed the Republican leadership was protecting Foley; here too reflecting a cover up issue.
(Noteworthy: In his press conference today, Denny Hastert actually used the word “cover-up” for the first time. The Speaker said that if the Foley investigations reveal any evidence of a cover-up, staff heads would roll. A little late Mr. Hastert?)
The CBS poll also shows a 46-26 margin of respondents believing Hastert should resign, while the Congressional vote came in 49 to 35, Dems over Republicans.
Another killer here is that CBS shows the Dems as the party holding the higher moral and ethical ground by 37 to 32 percent. By a two to one margin, respondents viewed the GOP as more corrupt. The Washington Post poll showed similar results.
The Foley scandal net is also widening among specific House races beyond Tom Reynolds up in Buffalo. In Westchester County, New York, Sue Kelly may now be in trouble. She was the Republican chairwoman of the House Page Board from 1998-2001, and may have known about Mark Foley’s lewd behavior during her tenure.
The House GOP 2006 contract form the online betting parlor TradeSports remains considerably lower from its September highs. It’s currently holding around 40 percent, down from 58 percent in the pre-Foley period when President Bush’s national security offensive had momentarily boosted Republican chances.
It is interesting to note that despite all this relentlessly negative news for the GOP, the stock market continues to gain ground. The Dow Jones continues plodding ahead, forging new record highs, while the other indexes also continue to rise.
The market is of course my favorite poll of all. It demonstrates that the outlook for the American economy remains solid. It also suggests that American security remains strong to protect the economy.
The market may also be predicting that a Democratic takeover of Congress will produce no negative legislative action on higher taxes, anti-business regulation, or key foreign policy decisions.
The stock market shrugged off North Korea’s bomb test, the U.S. dollar is trading strong on foreign exchanges, and the price of gold is weak. Perhaps the market is telling us that Republicans will get an election comeuppance, but in the long run, the United States is going to be just fine. I guess this reflects my own view.
The economy, stock market, our security, our democracy, our freedom, our optimistic outlook - it’s all part of the greatest story never told.
Monday, October 09, 2006
North Korea's Bomb
Outside of a drop in South Korean stocks, North Korea’s bomb test has had virtually no impact on the U.S. or world stock markets.. The best risk barometers—namely gold and oil—have barely moved. U.S. stocks are actually higher as of this writing.
I’ve been reading about various Apocalypse Now war scenarios from assorted neo-con type bombers and warriors, but frankly, I don’t get it. The big issue in the years ahead will be how to manage the total collapse and meltdown of North Korea whose economy is 1/40th the size of South Korea’s.
Think of this: the food shortages in North Korea are so bad that inhabitants are literally eating the bark off trees.
23 million North Korean refugees will be a big management problem for China, South Korea, and U.S. military forces. But wartime bombing of North Korea is not the solution. Some kind of diplomatic and economic discussion with China, South Korea, Japan, and others has to be the answer.
(Let’s not forget that North Korea is a long way from weaponization. Their July rocket tests fizzled badly. If North Korea invaded South Korea that would be different—very different. But that’s not happening.)
Reunification of the Koreas is inevitable. It’s just a question of how this process is nurtured and managed.
Any plausible solutions to North Korea must emphasize economic connectivity in that region, as part of a deal worked out with China, South Korea and Japan. Kim Jong-il wants attention, but he especially wants economic help. We shouldn’t give it to him until a grand design is worked out diplomatically. Again—with China, South Korea, and Japan.
This goes along with the best news I’ve seen on the global terror war in general, from master politico/diplomatist James Baker, who wants to negotiate with Iran and Syria in order to create some resolution for the Iraq disaster. Global negotiations on the other side of the world with China and the Koreas may be part of this grand design process.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.A look at the markets here at home and abroad in the wake of North Korea's nuclear test...
Our guests include:
** Doug Kass, founder and president of Seabreeze Partners Management, Inc.
** Russ Koesterich, senior portfolio manager for Barclays Global Investments
** John Rutledge, chairman and CEO of Rutledge Capital
We'll have an economic debate between supply-side guru Art Laffer and Kevin Hassett, Director of Economic Policy Studies at The American Enterprise Institute.
Frank Newport, Editor in Chief of The Gallup Poll, will bring some political clarity to our show in our weekly "Sunday Unspun" segment.
Independent pollster Scott Rasmussen, president of Rasmussen Reports, will offer additional political perspective.
Finally, Andrew Sullivan, journalist/author/blogger and former editor of The New Republic, will join James Taranto, editor of the Wall Street Journal's OpinionJournal.com in tackling a number of political subjects.
Friday, October 06, 2006
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.A WASHINGTON TO WALL STREET debate on Nancy Pelosi's plan, taxes, jobs and more.
On board to duke it out: The Wall Street Journal's Steve Moore & former Clinton labor secretary UC/Berkley professor Robert Reich.
YOUR MONEY, YOUR VOTE...a look at the latest in Washington with Republican pollster John McLaughlin; political consultant Frank Luntz; and Democratic pollster Peter Hart.
STOCK MARKET/ECONOMIC DEBATE between David Kotok, co-founder/CIO at Cumberland Advisors and Brian Wesbury, Chief Economist for First Trust Advisors.
KUDLOW'S STOCK CLUB: George Schwartz, 4-star Morningstar rated portfolio manager at Ave Maria Catholic Values Fund, will offer his latest stock picks.
Laffer Gets the Last Laugh (again)
From the AP:The federal budget deficit estimate for the fiscal year just completed has dropped to $250 billion, congressional estimators said Friday, as the economy continued to fuel impressive tax revenues.
The Congressional Budget Office's latest estimate is $10 billion below CBO predictions issued in August and well below a July White House prediction of $296 billion.
The improving deficit picture - Bush predicted a $423 billion deficit in his February budget - has been driven by better-than-expected tax receipts, especially from corporate profits, CBO said.
...when measured against the size of the economy, which is the comparison economists think is most important, the deficit picture looks even better.
And from the Wall Street Journal:
...The main cause of the deficit decline -- 90% of it, says White House budget director Rob Portman -- is a tidal wave of tax revenue. Tax collections have increased by $521 billion in the last two fiscal years, the largest two-year revenue increase -- even after adjusting for inflation -- in American history. If you're surprised to hear that, it's probably because inside Washington this is treated as the only secret no one wants to print. On the few occasions when the media pay attention to the rise in tax collections, they scratch their heads and wonder where this "surprising" and "unexpected windfall" came from.
...The IRS tax-return data just released last month indicates that a near-record 37% of those income tax payments are received from the top 1% of earners -- "the rich," who are derided regularly in Washington for not paying their "fair share."
...There hasn't been a purer validation of the Laffer Curve since Ronald Reagan rode off into the sunset...
November 7th
Last night I had dinner with a leading Republican pollster who is in the field for about twenty House races around the country. He told me that if the midterm elections were held today, the Dems would pick up 30 seats in the House.
Some of this is Foley/Hastert; some of it’s Iraq; and some of it’s just general discontent with the Washington status quo.
Lower gas prices and the Goldilocks economy should be positives, but that bullish message is being blocked by the Foley/Hastert mess, Iraq, Bob Woodward's book and so forth.
My dinner companion thought the GOP could hold the Senate - but it may be close.
With all this in mind, everyone should read the AP story entitled “Pelosi says she would drain GOP ‘Swamp’.”
The handwriting may be in the wall.
Some of this is Foley/Hastert; some of it’s Iraq; and some of it’s just general discontent with the Washington status quo.
Lower gas prices and the Goldilocks economy should be positives, but that bullish message is being blocked by the Foley/Hastert mess, Iraq, Bob Woodward's book and so forth.
My dinner companion thought the GOP could hold the Senate - but it may be close.
With all this in mind, everyone should read the AP story entitled “Pelosi says she would drain GOP ‘Swamp’.”
The handwriting may be in the wall.
The GOP and the Midterms
For what it's worth:Earlier this week on Kudlow & Company, James Pethokoukis, senior writer from U.S. News & World Report who recently penned the cover story "Campaignomics", had this to say:
"The economy definitely should be a wind at the back of Republicans and the GOP going into the midterm elections. Remember Gore and Clinton used to have this rap they would do, you know, everything that should be down is up and everything that's up is down? Well, it's just the opposite right now. Everything that should be up is kind of up. Stocks are up; earnings are up; growth is up; jobs are up. And gas prices, the one thing that should be down, is finally falling. So that should help the GOP come November 7th...
For me to believe that the economy is not going to help Republicans, I have to believe the average voter is going to go in the voting booth, and think, 'Well, gee, I'm not paying as much for gas, I feel better about my job, wages are up. But, ehh, you know, something happened in Florida. That's it! I'm going to throw my congressman out.' That just doesn't seem very likely to me."
Call me Pollyanna, but I think there's a reasonable shot the GOP might be okay when all is said and done...
Thursday, October 05, 2006
Did Someone Say Cover-up?
A new poll from Scott Rasmussen conducted Tuesday and Wednesday night reports that 61 percent of American adults believe that Republican leaders have been “protecting Mark Foley for several years.” Only 21 percent believe that the leadership “just learned about Foley’s problems last week.”
The word “protecting” is a very nice, polite term pollsters use for cover-up.
The House GOP 2006 contract at online betting parlor TradeSports dropped 5 points today to less than 43 percent.
Let me emphasize from my earlier posts that a party without ethical principles is no party at all. Bad principles lead to bad politics—whether on national security, taxes, or ethics and morality. Saving Mr. Hastert may be doing enormous damage to the Republicans in next month’s elections.
There are also reports that Republican pollsters in the field are finding a catastrophic impact from Hastert.
And as far as his press conference today goes, the Speaker raised more questions than he answered. And he didn’t take responsibility for the timeline that clearly points to either his knowing about the Foley problem, or his staff knowing, which is all the same thing in my view.
In addition, this morning’s Washington Post reports that Hastert crony John Shimkus (R-IL), along with Jeff Trandahl, former House clerk and a member of the Page Board, were provided the text of the emails a year ago (including Foley’s request for the boy’s photo on a standard sized sheet of paper.) Trandahl, now director of the National Fish and Wildlife Foundation, will not respond to press inquiries.
A Shimkus spokesman put this information out yesterday according to Jonathan Wiseman and Charles Babington, the Washington Post staff reporters.
Of course, this email information was not shared with the Dems on the Page Board.
Did someone say cover-up?
The word “protecting” is a very nice, polite term pollsters use for cover-up.
The House GOP 2006 contract at online betting parlor TradeSports dropped 5 points today to less than 43 percent.
Let me emphasize from my earlier posts that a party without ethical principles is no party at all. Bad principles lead to bad politics—whether on national security, taxes, or ethics and morality. Saving Mr. Hastert may be doing enormous damage to the Republicans in next month’s elections.
There are also reports that Republican pollsters in the field are finding a catastrophic impact from Hastert.
And as far as his press conference today goes, the Speaker raised more questions than he answered. And he didn’t take responsibility for the timeline that clearly points to either his knowing about the Foley problem, or his staff knowing, which is all the same thing in my view.
In addition, this morning’s Washington Post reports that Hastert crony John Shimkus (R-IL), along with Jeff Trandahl, former House clerk and a member of the Page Board, were provided the text of the emails a year ago (including Foley’s request for the boy’s photo on a standard sized sheet of paper.) Trandahl, now director of the National Fish and Wildlife Foundation, will not respond to press inquiries.
A Shimkus spokesman put this information out yesterday according to Jonathan Wiseman and Charles Babington, the Washington Post staff reporters.
Of course, this email information was not shared with the Dems on the Page Board.
Did someone say cover-up?
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.More on the Foley Fallout...
Our guests are conservative columnist David Limbaugh; University of Virginia political analyst Larry Sabato; Democratic strategist Julian Epstein; and Chuck Todd, editor-in-chief of The Hotline.
A stock market discussion with Noah Blackstein, lead portfolio manager for the Dynamic Power American Growth Fund; Cody Willard, money manager and contributor to TheStreet.com's RealMoney; and senior MarketWatch columnist Herb Greenberg.
We'll take a look at today's strong retail numbers and the resilient U.S. consumer with Kimberly Greenberger, retail analyst at Citigroup.
An economic debate focusing on tomorrow's jobs report with Don Luskin, chief investment officer of Trend Macrolytics and John Silvia chief economist from Wachovia.
The Bush Boom
From National Review Online:
After flirting with record closings for more than a week, the Dow Jones Industrial Average surpassed its all-time close of 11,722.98 on Tuesday, ending the day at 11,727.34.
Some say this new Dow territory merely puts us back where we were five years ago. But this argument misses the point. We’re not back where we were five years ago. Five years ago, the markets were working their way out of a bubble; this time it’s the real thing.
A financial bubble is much like a soap bubble. It occurs when the value of something increases, but inside that increase there’s a good amount of air. Over time, the skin of a bubble grows thin, and eventually the bubble either breaks or deflates. Bubbles are, by definition, hollow.
The current boom, however, is different. It is driven by something tangible — profits. As the above chart shows, since the full implementation of the president’s tax cuts in 2003, both profits and stock prices have been rising. In fact, stocks have not yet caught up with the underlying fundamentals of profit growth.
From companies to shareholders, those who bet on the Bush boom have done well. Those who bet against it, lost out.
— Jerry Bowyer is an economic advisor to Blue Vase Capital Management and the author of The Bush Boom.
After flirting with record closings for more than a week, the Dow Jones Industrial Average surpassed its all-time close of 11,722.98 on Tuesday, ending the day at 11,727.34.
Some say this new Dow territory merely puts us back where we were five years ago. But this argument misses the point. We’re not back where we were five years ago. Five years ago, the markets were working their way out of a bubble; this time it’s the real thing.
A financial bubble is much like a soap bubble. It occurs when the value of something increases, but inside that increase there’s a good amount of air. Over time, the skin of a bubble grows thin, and eventually the bubble either breaks or deflates. Bubbles are, by definition, hollow.
The current boom, however, is different. It is driven by something tangible — profits. As the above chart shows, since the full implementation of the president’s tax cuts in 2003, both profits and stock prices have been rising. In fact, stocks have not yet caught up with the underlying fundamentals of profit growth.
From companies to shareholders, those who bet on the Bush boom have done well. Those who bet against it, lost out.
— Jerry Bowyer is an economic advisor to Blue Vase Capital Management and the author of The Bush Boom.
A Step in the Right Direction
From Reuters:
The government can continue to use its [NSA terrorist surveillance program] pending the Justice Department's appeal of a federal judge's [ridiculous] ruling outlawing the program, an Appeals Court in Cincinnati ruled on Wednesday.
The ruling overturned [liberal, Jimmy Carter appointed] District Judge Anna Diggs Taylor's decision last week to deny a lengthy stay in the case, which is expected to end up with the Supreme Court [where the High Court will almost certainly overturn the Diggs decision].
In August, Taylor [incorrectly] ruled that the National Security Agency's five-year-old [terrorist] surveillance program, [a successful, eminently sensible program which has saved countless lives and poses little to no risk to civil liberties] implemented as part of the government's war on terrorism, violates the civil rights of Americans.
The [head-in-the-sand] American Civil Liberties Union filed the suit in March on behalf of [liberal] scholars, [saboteurs], attorneys, journalists and non-profit groups that regularly [undermine our national security and] communicate with people in the Middle East.
[In related news, terrorists are still actively plotting to attack our country and kill innocent people.]
The government can continue to use its [NSA terrorist surveillance program] pending the Justice Department's appeal of a federal judge's [ridiculous] ruling outlawing the program, an Appeals Court in Cincinnati ruled on Wednesday.
The ruling overturned [liberal, Jimmy Carter appointed] District Judge Anna Diggs Taylor's decision last week to deny a lengthy stay in the case, which is expected to end up with the Supreme Court [where the High Court will almost certainly overturn the Diggs decision].
In August, Taylor [incorrectly] ruled that the National Security Agency's five-year-old [terrorist] surveillance program, [a successful, eminently sensible program which has saved countless lives and poses little to no risk to civil liberties] implemented as part of the government's war on terrorism, violates the civil rights of Americans.
The [head-in-the-sand] American Civil Liberties Union filed the suit in March on behalf of [liberal] scholars, [saboteurs], attorneys, journalists and non-profit groups that regularly [undermine our national security and] communicate with people in the Middle East.
[In related news, terrorists are still actively plotting to attack our country and kill innocent people.]
Wednesday, October 04, 2006
Schumpeter's Gales of Creative Destruction
Richard Rahn hit the nail on the head in his Washington Times op/ed earlier this week:
The "real do-gooders," in the sense that their actions really do alleviate poverty and make life better for their fellow man, are entrepreneurs who create real jobs, goods and services that make our lives better, and those political leaders who have reduced unnecessary regulations and strengthened property rights, such as Margaret Thatcher, Ronald Reagan and Mart Laar (the former Estonian prime minister who led the reforms in his country)...
Governments cannot create jobs; they can only destroy jobs in the private sector by increasing taxation on the productive to create a "new government job." Many of those who attack Wal-Mart or other business people for not paying "high enough" wages, or the rich for not paying "enough" in taxes, have never created a productive job in their lives, nor have they ever had the imagination or energy to create any new good or service to make our lives better. Yet, they often refer to themselves and are indeed called "do-gooders." What a perversion of the language.
The "real do-gooders," in the sense that their actions really do alleviate poverty and make life better for their fellow man, are entrepreneurs who create real jobs, goods and services that make our lives better, and those political leaders who have reduced unnecessary regulations and strengthened property rights, such as Margaret Thatcher, Ronald Reagan and Mart Laar (the former Estonian prime minister who led the reforms in his country)...
Governments cannot create jobs; they can only destroy jobs in the private sector by increasing taxation on the productive to create a "new government job." Many of those who attack Wal-Mart or other business people for not paying "high enough" wages, or the rich for not paying "enough" in taxes, have never created a productive job in their lives, nor have they ever had the imagination or energy to create any new good or service to make our lives better. Yet, they often refer to themselves and are indeed called "do-gooders." What a perversion of the language.
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.We'll start the show with a look at the surging stock market.
Our guests include:
* David Goldman, Head of Fixed Income Research at Cantor Fitzgerald
* Jeff Kleintop, chief investment strategist of PNC Wealth Management
* Herb Greenberg, senior columnist for MarketWatch
We'll continue our look at the fallout from the Foley scandal...
Our guests include Rep. Paul Ryan (R-WI); Larry Sabato, Professor of Politics at the University of Virginia; James Taranto, columnist at the Wall Street Journal and Craig Crawford, columnist for Congressional Quarterly.
CNBC's Tyler Mathisen will keep us abreast of the latest political and financial headlines.
"CAMPAIGNOMICS"...A Washington to Wall Street discussion with James Pethokoukis of U.S. News & World Report and Steve Pearlstein from the Washington Post.
The Speaker Should Resign
Denny Hastert’s dysfunctional leadership and Tony Blankley’s terrific column, “Its Never Too Late to Do the Right Thing”, are the two significant themes in the Foley scandal story today.
A hundred kudos belong to Blankley for his ethical approach to Foley and Hastert in his latest column. (And also for the Washington Times editorial yesterday calling for the Speaker’s immediate resignation.)
“[W]e Republicans can only be responsible for our own conduct and conscience” he wrote, along with, “[D]efending Denny Hastert’s decisions is ethically wrong.” Bravo to my old friend Tony Blankley.
As for Hastert’s dysfunction, a few gems:
In his Hugh Hewitt radio interview, Hastert said he was too busy with Katrina, deficit reduction, and Tom DeLay a year ago to pay any attention to the Foley emails. Huh?
Hastert also refused to deal with Tom Reynolds’ assertion that this spring Reynolds took the email to Hastert. But of course the Speaker took no action.
And then the John Boehner line: “I believe I talked to the Speaker and he told me it had been taken care of…and my position is it’s in his corner, it’s his responsibility.” (That was last spring; around the time Reynolds went to Hastert.)
These are examples of dysfunction, bad ethical judgment, and bad political judgment. To top it off, Bob Novak cites Hastert asserting that “I just don’t recall or remember” the Reynolds red flag on the Foley email this past spring.
Another gem from the Hugh Hewitt interview was that Hastert let John Shimkus handle the red flag email problem last year. All this shows why Mr. Hastert must go. He is a poor manager, poor administrator, and a poor leader who will only hurt the GOP.
In fact, were it not for Mr. Hastert’s ineptness in dealing with these red flags, the Foley sex scandal might have been only a 2 or 3 day news story, rather than this colossal mess with a national impact on congressional races.
One final point—the mealy-mouthed defense that the instant messages weren’t known until recently is nonsense. Foley’s earlier emails were more than sufficient to sound the alarm that a huge problem was brewing. The IM defense of Hasert is a loser.
Either the Republican Party stands on principal, or it collapses under its own immoral weight.
Mr. Hastert should resign now.
A hundred kudos belong to Blankley for his ethical approach to Foley and Hastert in his latest column. (And also for the Washington Times editorial yesterday calling for the Speaker’s immediate resignation.)
“[W]e Republicans can only be responsible for our own conduct and conscience” he wrote, along with, “[D]efending Denny Hastert’s decisions is ethically wrong.” Bravo to my old friend Tony Blankley.
As for Hastert’s dysfunction, a few gems:
In his Hugh Hewitt radio interview, Hastert said he was too busy with Katrina, deficit reduction, and Tom DeLay a year ago to pay any attention to the Foley emails. Huh?
Hastert also refused to deal with Tom Reynolds’ assertion that this spring Reynolds took the email to Hastert. But of course the Speaker took no action.
And then the John Boehner line: “I believe I talked to the Speaker and he told me it had been taken care of…and my position is it’s in his corner, it’s his responsibility.” (That was last spring; around the time Reynolds went to Hastert.)
These are examples of dysfunction, bad ethical judgment, and bad political judgment. To top it off, Bob Novak cites Hastert asserting that “I just don’t recall or remember” the Reynolds red flag on the Foley email this past spring.
Another gem from the Hugh Hewitt interview was that Hastert let John Shimkus handle the red flag email problem last year. All this shows why Mr. Hastert must go. He is a poor manager, poor administrator, and a poor leader who will only hurt the GOP.
In fact, were it not for Mr. Hastert’s ineptness in dealing with these red flags, the Foley sex scandal might have been only a 2 or 3 day news story, rather than this colossal mess with a national impact on congressional races.
One final point—the mealy-mouthed defense that the instant messages weren’t known until recently is nonsense. Foley’s earlier emails were more than sufficient to sound the alarm that a huge problem was brewing. The IM defense of Hasert is a loser.
Either the Republican Party stands on principal, or it collapses under its own immoral weight.
Mr. Hastert should resign now.
From this morning's Wall Street Journal:
...Yesterday's new Dow Jones high is nonetheless worth celebrating as a sign of America's economic resilience. At the start of every bear market, there are always voices saying we will never see the top again. But the smartest investors always turn out to be those who see new lows as a buying opportunity.
In the current mini-bull market, stocks have been driven by a record 13 straight quarters of double-digit gains in corporate earnings. With more of the same expected this year and next, many stocks have price earnings ratios that make them good targets for "value" investors.
The stock market's strength is an especially good omen given that we are at a point in this expansion when many economists doubt its staying power. Investors seem to be betting that rising rates, the housing slump and a possible change of power in Congress won't stop the economy's growth. They may well be wrong in the short term. But the lesson of yesterday's new stock market high is that in the long term optimism always pays.
...Yesterday's new Dow Jones high is nonetheless worth celebrating as a sign of America's economic resilience. At the start of every bear market, there are always voices saying we will never see the top again. But the smartest investors always turn out to be those who see new lows as a buying opportunity.
In the current mini-bull market, stocks have been driven by a record 13 straight quarters of double-digit gains in corporate earnings. With more of the same expected this year and next, many stocks have price earnings ratios that make them good targets for "value" investors.
The stock market's strength is an especially good omen given that we are at a point in this expansion when many economists doubt its staying power. Investors seem to be betting that rising rates, the housing slump and a possible change of power in Congress won't stop the economy's growth. They may well be wrong in the short term. But the lesson of yesterday's new stock market high is that in the long term optimism always pays.
Tuesday, October 03, 2006
Kangaroo Punch to the Left
Australian Prime Minister John Howard apparently delivered one heckuva speech last night rebuking his country's misguided left.Who knew we had so much in common with our friends down under?
From the Australian Associated Press:
PRIME Minister John Howard has launched a scathing attack on Australia's left-wing intelligentsia, questioning its loyalty to the nation over the past decades.
In a speech delivered last night for the 50th anniversary of the conservative magazine Quadrant, Mr Howard said the left had a history of denigrating the nation and was now doing the same with the war in Iraq, describing Islamic terrorism as the new tyranny.
He said Australian universities were still breeding leftists and described pro-communists of decades past as “ideological barrackers for regimes of oppression opposed to Australia and its interests”, Fairfax reports today.
Mr Howard said the left was wrong in its view that the Cold War was an equal struggle between the ideologies of the United States and the Soviet Union.
“It became the height of intellectual sophistication to believe that people in the West were no less oppressed than people under the yoke of communist dictatorship,” Mr Howard said in his speech.
Mr Howard praised Quadrant for its record of countering “stultifying orthodoxies and dangerous utopias that have, at times, gripped the Western intelligentsia”.
Transcript of PM Howard's speech
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.Leading off the show tonight will be our market mavens who will offer their insights on the market surge. Our guests include:
***Barry Ritholz, Chief Market Strategist for Ritholtz Research
***Joe Battipaglia, CIO at Ryan, Beck & Co
***Stefan Abrams, CIO, Trust Company of the West
***JJ Burns, president of JJ Burns & Company
***Futures expert Philip Gotthelf, President of Equidex Inc, will discuss gold's recent dramatic plunge.
Brian Barish, president and director of research for Cambiar Investors, will be our guest for Kudlow's Stock Club and offer his 5-star Morningstar rated stock selections.
We'll debate the economy and the inflation outlook with Stephen Cecchetti, Professor of Economics and Finance at Brandeis University and Ian Morris, chief U.S. economist at HSBC.
Finally, we'll look at the Foley scandal fallout with David Bossie, president of the group Citizens United; Dr. Charmaine Yoest of the Family Research Council, and Rick Tyler, Newt Gingrich's Communications Director.
Defeat, Pessimism, & the Nagging Itch to Raise Our Taxes
As I said on last night’s Kudlow & Company, the Democrats have completely failed on terrorism and the economy. It’s not even close. They bring nothing to the table except defeat, pessimism, and the nagging itch to raise our taxes.
They offer nothing in the way of national security and the global fight against terror--unless you consider cutting and running and defunding the war in Iraq a viable strategy.
They’re against all the vital and important anti-terrorism measures--the Patriot Act, warrant-less wiretaps, data-mining for al-Qaeda phone calls, the interrogation and detention of the enemy, etc. At every turn in the road, Dems stand in the way, undermining the necessary tools, the people, and the programs we desperately need here at home to succeed and thrive in the years ahead.
In short, if it makes sense, if it's good for national security, and if it's good for the economy, the Dems are against it.
Make sure to read Investors Business Daily's dynamite editorial
exposing the hypocrisy and absurdity of what the Dems are attempting to do with this Foley mess. Here's a snippet:
Right after Mark Foley was revealed to have had inappropriate e-mail conversations with a 16-year-old page, he resigned and checked into rehab. Now, what did Democrats know, and when did they know it?
Yes, you read that right: the Democrats. It's of course clear that Foley, a Republican representative from Florida, resigned for good cause. We don't defend him or his inexcusable behavior — good riddance.
But it didn't take long at all after Foley's resignation for the Democrats to call for an investigation of the entire Republican leadership in the House, charging that GOP stalwarts knew early on that Foley, as they like to say in the rehab business, had a "problem."
Democrats have begun losing their once-significant lead in the polls, and a mere five weeks remain until the midterm elections. Is this scandal the Democrats' own "October Surprise," meant to throw the GOP into a tailspin shortly before the vote?
Recent polls show Democrats aren't doing very well on several key issues. What better way than a good, old-fashioned sex scandal to get people's minds off such things as the importance of winning the war in Iraq, our ongoing vulnerability to terrorist attack and the necessity of keeping the Bush economic boom going?....
They offer nothing in the way of national security and the global fight against terror--unless you consider cutting and running and defunding the war in Iraq a viable strategy.
They’re against all the vital and important anti-terrorism measures--the Patriot Act, warrant-less wiretaps, data-mining for al-Qaeda phone calls, the interrogation and detention of the enemy, etc. At every turn in the road, Dems stand in the way, undermining the necessary tools, the people, and the programs we desperately need here at home to succeed and thrive in the years ahead.
In short, if it makes sense, if it's good for national security, and if it's good for the economy, the Dems are against it.
Make sure to read Investors Business Daily's dynamite editorial
exposing the hypocrisy and absurdity of what the Dems are attempting to do with this Foley mess. Here's a snippet:
Right after Mark Foley was revealed to have had inappropriate e-mail conversations with a 16-year-old page, he resigned and checked into rehab. Now, what did Democrats know, and when did they know it?
Yes, you read that right: the Democrats. It's of course clear that Foley, a Republican representative from Florida, resigned for good cause. We don't defend him or his inexcusable behavior — good riddance.
But it didn't take long at all after Foley's resignation for the Democrats to call for an investigation of the entire Republican leadership in the House, charging that GOP stalwarts knew early on that Foley, as they like to say in the rehab business, had a "problem."
Democrats have begun losing their once-significant lead in the polls, and a mere five weeks remain until the midterm elections. Is this scandal the Democrats' own "October Surprise," meant to throw the GOP into a tailspin shortly before the vote?
Recent polls show Democrats aren't doing very well on several key issues. What better way than a good, old-fashioned sex scandal to get people's minds off such things as the importance of winning the war in Iraq, our ongoing vulnerability to terrorist attack and the necessity of keeping the Bush economic boom going?....
Step Aside, Speaker Hastert
House Speaker Dennis Hastert must do the only right thing, and resign his speakership at once. Either he was grossly negligent for not taking the red flags fully into account and ordering a swift investigation, for not even remembering the order of events leading up to last week's revelations -- or he deliberately looked the other way in hopes that a brewing scandal would simply blow away. He gave phony answers Friday to the old and ever-relevant questions of what did he know and when did he know it? Mr. Hastert has forfeited the confidence of the public and his party, and he cannot preside over the necessary coming investigation, an investigation that must examine his own inept performance... -Today's Washington Times editorial
Not only has Speaker Denny Hastert thoroughly mishandled the Mark Foley incident, he has been an ineffective leader, one who has failed to communicate broad policy and philosophical goals for the House GOP. Thanks to Hastert, there has been no guiding Republican message emanating from the House -- a huge missed opportunity to say the least.
I’ll deal first with the Washington scandal du jour. In 2002, Foley thanked that year’s class of congressional pages with a bizarre, tearful speech that smacked of a guilty conscience and hypocritical emotions. According to the ABC blotter, “some of the very same pages in the chamber that day would months later receive Foley’s sexually explicit messages.” Clearly, Foley has acute problems.
But Republican staff warned congressional pages five years ago to watch out for Foley, now the former representative from Florida. Yet Mr. Hastert took no action.
Last year, sick e-mails from Foley were passed on to the speaker’s staff. But again, no action was taken.
This past spring, more Foley complaints were raised with three GOP leaders -- including Hastert. Yet the speaker took no action.
The red flags were there, and in not acting decisively Hastert failed his party. But he also short-changed a key Republican constituency -- the GOP’s vital evangelical Christian base, which rightly trumpets the need for clear, pro-family moral and ethical standards in politics in order to stop the secular trend of moral relativism and the demoralizing rejection of faith.
The time has come for a change in the GOP caucus. But in the wake of the Foley incident, such a change may well occur as the GOP assembles a minority caucus next January.
And Republicans have Denny Hastert to thank for that -- and not only because he couldn’t cut a messy scandal off at the pass. I would describe Hastert’s leadership of the House in general as negligent.
Former House Speaker Newt Gingrich was message driven. So was former House Majority Leader Dick Armey. But since their departures, the House leadership has failed to deliver a clear and cohesive Republican message on low tax rates, budget restraint, earmark reform, private savings accounts for Social Security and healthcare, and firm oversight of the Iraq war and the Katrina cleanup.
Rather than a winning message of economic growth, a strong defense, and optimism for the future, Hastert has given us silence. And where’s his response to the House Democrats, who take every opportunity to speak up?
House Democrats are weak on defense, frail on national security, and opposed to anti-terrorist measures such as warrant-less wiretaps, data-mining for al-Qaeda phone calls, and the interrogation and detention of the enemy. Meanwhile, House Democrats want to raise taxes, unleash a government takeover of healthcare, and defund the war on Iraq.
Where’s the counterpunch from the Republican speaker?
House stalwarts like David Drier, Mike Pence, and John Shadegg have all tried to generate a strong GOP message. But Hastert has stepped in their way. It’s as if no unified GOP message is possible while Hastert is in charge. Hastert wants things quiet.
Seldom does he make himself available to the press, including various cable and broadcast talk shows. He has operated as a behind-the-scenes player, someone who is worried more about process and compromise than advancing Republican philosophy.
And there are consequences to such reticence. Tax reform has gone by the wayside. So has spending reform. So has free trade. So has true immigration reform.
Yes, Hastert’s House did extend the investor tax cuts. But where has Hastert been on abolishing or reforming the multiple taxation of capital? On the need to greatly expand all forms of personal savings accounts to cover retirement, healthcare, and education? On any program that would reach out to the “investor class” or “ownership class”?
Hastert doesn’t lead; he drops the ball.
He never discusses key election issues, particularly economic issues. Where is he on the Bush bull market for stocks; or the not-too-hot, not-too-cold, but steadily expanding Goldilocks economy; or the resiliency of the American consumer; or plunging gasoline prices; or the remarkable profit-making health of U.S. businesses in the aftermath of President Bush’s supply-side tax cuts?
Recent polls from the L.A. Times and Gallup show that the public approves of the economy, yet refuses to give Bush or the GOP any credit for it. This in good part is a failure of Mr. Hastert and his leadership group, who for some reason never talk about the obvious economic successes of their very own polices.
President Bush has been out on the campaign trail, heroically selling tax cuts, the economy, and national security. Dennis Hastert has been nowhere to be found. He was quiet on Foley when he should have been loud, but his silence is no isolated incident.
The speaker should step aside.
Not only has Speaker Denny Hastert thoroughly mishandled the Mark Foley incident, he has been an ineffective leader, one who has failed to communicate broad policy and philosophical goals for the House GOP. Thanks to Hastert, there has been no guiding Republican message emanating from the House -- a huge missed opportunity to say the least.
I’ll deal first with the Washington scandal du jour. In 2002, Foley thanked that year’s class of congressional pages with a bizarre, tearful speech that smacked of a guilty conscience and hypocritical emotions. According to the ABC blotter, “some of the very same pages in the chamber that day would months later receive Foley’s sexually explicit messages.” Clearly, Foley has acute problems.
But Republican staff warned congressional pages five years ago to watch out for Foley, now the former representative from Florida. Yet Mr. Hastert took no action.
Last year, sick e-mails from Foley were passed on to the speaker’s staff. But again, no action was taken.
This past spring, more Foley complaints were raised with three GOP leaders -- including Hastert. Yet the speaker took no action.
The red flags were there, and in not acting decisively Hastert failed his party. But he also short-changed a key Republican constituency -- the GOP’s vital evangelical Christian base, which rightly trumpets the need for clear, pro-family moral and ethical standards in politics in order to stop the secular trend of moral relativism and the demoralizing rejection of faith.
The time has come for a change in the GOP caucus. But in the wake of the Foley incident, such a change may well occur as the GOP assembles a minority caucus next January.
And Republicans have Denny Hastert to thank for that -- and not only because he couldn’t cut a messy scandal off at the pass. I would describe Hastert’s leadership of the House in general as negligent.
Former House Speaker Newt Gingrich was message driven. So was former House Majority Leader Dick Armey. But since their departures, the House leadership has failed to deliver a clear and cohesive Republican message on low tax rates, budget restraint, earmark reform, private savings accounts for Social Security and healthcare, and firm oversight of the Iraq war and the Katrina cleanup.
Rather than a winning message of economic growth, a strong defense, and optimism for the future, Hastert has given us silence. And where’s his response to the House Democrats, who take every opportunity to speak up?
House Democrats are weak on defense, frail on national security, and opposed to anti-terrorist measures such as warrant-less wiretaps, data-mining for al-Qaeda phone calls, and the interrogation and detention of the enemy. Meanwhile, House Democrats want to raise taxes, unleash a government takeover of healthcare, and defund the war on Iraq.
Where’s the counterpunch from the Republican speaker?
House stalwarts like David Drier, Mike Pence, and John Shadegg have all tried to generate a strong GOP message. But Hastert has stepped in their way. It’s as if no unified GOP message is possible while Hastert is in charge. Hastert wants things quiet.
Seldom does he make himself available to the press, including various cable and broadcast talk shows. He has operated as a behind-the-scenes player, someone who is worried more about process and compromise than advancing Republican philosophy.
And there are consequences to such reticence. Tax reform has gone by the wayside. So has spending reform. So has free trade. So has true immigration reform.
Yes, Hastert’s House did extend the investor tax cuts. But where has Hastert been on abolishing or reforming the multiple taxation of capital? On the need to greatly expand all forms of personal savings accounts to cover retirement, healthcare, and education? On any program that would reach out to the “investor class” or “ownership class”?
Hastert doesn’t lead; he drops the ball.
He never discusses key election issues, particularly economic issues. Where is he on the Bush bull market for stocks; or the not-too-hot, not-too-cold, but steadily expanding Goldilocks economy; or the resiliency of the American consumer; or plunging gasoline prices; or the remarkable profit-making health of U.S. businesses in the aftermath of President Bush’s supply-side tax cuts?
Recent polls from the L.A. Times and Gallup show that the public approves of the economy, yet refuses to give Bush or the GOP any credit for it. This in good part is a failure of Mr. Hastert and his leadership group, who for some reason never talk about the obvious economic successes of their very own polices.
President Bush has been out on the campaign trail, heroically selling tax cuts, the economy, and national security. Dennis Hastert has been nowhere to be found. He was quiet on Foley when he should have been loud, but his silence is no isolated incident.
The speaker should step aside.
Monday, October 02, 2006
Tonight's Lineup
CNBC's Kudlow & Company will broadcast live at 5:00pm EST this evening.On tonight's show:
We'll begin with a hard look at the political fallout from Florida Congressman Mark Foley with Democratic strategist Julian Epstein and University of Virginia political scientist Larry Sabato.
Frank Newport, Editor in Chief of The Gallup Poll, will provide some needed clarity in our "Sunday Unspun" segment.
Our market panel will offer their perspectives on what's around the corner in the stock market and economy.
We'll be joined by Michelle Girard, senior economist at RBS Greenwich Capital Management ; Joe LaVorgna, chief US economist at Deutsche Bank; Jason Trennert, Chief Investment Strategist at Strategas Research Partners; and Elizabeth MacDonald, Forbes magazine senior editor.
Al Hubbard, director of the White House National Economic Council will also join us.
And finally, The Wall Street Journal's Kim Strassel will debate what's really going on with wages with Jared Bernstein, economist at the Economic Policy Institute.
"Who's Really in Denial?"
(It's not President Bush according to Bill Kristol in his Weekly Standard editorial)
"Americans face the choice between two parties with two different attitudes on this war on terror."
--George W. Bush, September 28, 2006
President Bush is right. It would be nice if he weren't. The country would be better off if there were bipartisan agreement on what is at stake in the struggle against jihadist Islam. But despite areas of consensus, there is still a fundamental difference between the parties. Bush and the Republicans know we are in a serious war. It's not the Bush administration that is in a "State of Denial" (as the new Bob Woodward book has it). It's the Democrats...
"Americans face the choice between two parties with two different attitudes on this war on terror."
--George W. Bush, September 28, 2006
President Bush is right. It would be nice if he weren't. The country would be better off if there were bipartisan agreement on what is at stake in the struggle against jihadist Islam. But despite areas of consensus, there is still a fundamental difference between the parties. Bush and the Republicans know we are in a serious war. It's not the Bush administration that is in a "State of Denial" (as the new Bob Woodward book has it). It's the Democrats...
Victor Davis Hanson sums up the Dems rather nicely:
But with the present-day Democrats, they apparently must be careful that at any given second a Democratic Senator might go off and compare our troops to terrorists (Kerry), Pol Pot (Durbin), or Saddam’s jailers (Kennedy), or perhaps suggest Iraq was better off under the Husseins (Rockefeller). The result is an addiction to dissimulation, a constant paranoia that without warning someone will say what they feel, and thereby reveal to the American people just how far this bunch has strayed from Harry Truman, Henry Jackson, and JFK—and how radically they have become enthralled with the various victim industries, academia, Hollywood, and the fringe of Michael Moore, Cindy Sheehan, and the Daily Kos.
But with the present-day Democrats, they apparently must be careful that at any given second a Democratic Senator might go off and compare our troops to terrorists (Kerry), Pol Pot (Durbin), or Saddam’s jailers (Kennedy), or perhaps suggest Iraq was better off under the Husseins (Rockefeller). The result is an addiction to dissimulation, a constant paranoia that without warning someone will say what they feel, and thereby reveal to the American people just how far this bunch has strayed from Harry Truman, Henry Jackson, and JFK—and how radically they have become enthralled with the various victim industries, academia, Hollywood, and the fringe of Michael Moore, Cindy Sheehan, and the Daily Kos.
The Foley Mess
The last House GOP contract at TradeSports traded at 46. That’s down a hefty 11 points or so from its recent high. Clearly, the Foley scandal is really taking its toll.
Of course, the simple reason for this is that instead of needing 15 seats, the Dems need 14. (Make that 13 because they’re going to lose Tom Delay’s seat.)
The bigger issue here is whether there’s any GOP House leadership cover-up. If so, it will be an unmitigated disaster.
There are two stages to this mess: The first is the email which didn’t look that bad. But then came release of the instant messages. Those messages spelled disaster for Foley.
So, it may be that when Rep. Tom Reynolds (R-NY) first told Hastert last fall, he knew about the emails but not the instant messages. But this is still tricky in terms of what did the GOP leadership know and when did they know it.
All that said, it is possible that additional names will surface. There is no evidence of that yet, but Dems have had their sex related problems too. Ironically, it was the Republican House that passed Internet legislation that makes this a federal crime led by Foley and including good guys like Mike Pence.
But we will be watching the TradeSports action very carefully. We will also be watching the stock market to see if there’s any blowback on this front.
Of course, the simple reason for this is that instead of needing 15 seats, the Dems need 14. (Make that 13 because they’re going to lose Tom Delay’s seat.)
The bigger issue here is whether there’s any GOP House leadership cover-up. If so, it will be an unmitigated disaster.
There are two stages to this mess: The first is the email which didn’t look that bad. But then came release of the instant messages. Those messages spelled disaster for Foley.
So, it may be that when Rep. Tom Reynolds (R-NY) first told Hastert last fall, he knew about the emails but not the instant messages. But this is still tricky in terms of what did the GOP leadership know and when did they know it.
All that said, it is possible that additional names will surface. There is no evidence of that yet, but Dems have had their sex related problems too. Ironically, it was the Republican House that passed Internet legislation that makes this a federal crime led by Foley and including good guys like Mike Pence.
But we will be watching the TradeSports action very carefully. We will also be watching the stock market to see if there’s any blowback on this front.
Subscribe to:
Posts (Atom)
