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Tilting at Windmills

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July 21, 2008
By: Kevin Drum

QUOTE OF THE DAY....From Roy Edroso, on conservative efforts to insist that the economy is actually just peachy:

Could this be the year in which Mencken's Law is broken, and somebody goes broke underestimating the intelligence of the American people?

Maybe!

Kevin Drum 12:50 PM Permalink | Trackbacks | Comments (40)

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Comments

Millions of people are already broke & have nothing to bet with.

Posted by: pj in jesusland on July 21, 2008 at 1:00 PM | PERMALINK

I am enjoying watching the Republicans twist themselves into pretzels trying to convince the American public that strictly speaking, by definition we are not in a recession and stop whining about the economy. How intellectual and elitist of them.

Posted by: ckelly on July 21, 2008 at 1:05 PM | PERMALINK

Support for McCain is still high enough to suggest that Mencken is still right.

Posted by: AJB on July 21, 2008 at 1:08 PM | PERMALINK

This is funny, but I know a lot of Republicans. Some mouth support for McCain, but their support is about an inch deep. I think he might get more votes if he stopped campaigning. The more he says the more my Republican friends shake their heads.

Posted by: Ron Byers on July 21, 2008 at 1:18 PM | PERMALINK

god bless roy. if you're not reading him, you should. funny man.

your pal,
blake

Posted by: blake on July 21, 2008 at 1:18 PM | PERMALINK

As anyone who is paying attention knows - the American economy is in terrible shape and is currently on the brink of the abyss. If we don't curtail the reckless borrowing that both political parties have facilitated over the past eight years, we will have dug ourselves a hole we can never, ever climb out of. As T. Boone Pickens has said, we are witnessing the most massive transfer of wealth in the history of humankind, as America transfers all of it's accumulated wealth to China and the Arab Gulf States. If you believe articles like this one, we may be nearing the complete collapse of the U.S. economy.

Posted by: The Conservative Deflator on July 21, 2008 at 1:34 PM | PERMALINK

That nice conservative just sold us this rope!

OK, the rabbit comes up out of the hole and runs around the tree eleven ... no, thirteen times ....
.

Posted by: Grand Moff Texan on July 21, 2008 at 1:37 PM | PERMALINK

TCD, that article is rather tin-foil hattish.

Posted by: optical weenie on July 21, 2008 at 1:39 PM | PERMALINK

TCD's articles usually are.

Posted by: Ruck on July 21, 2008 at 1:52 PM | PERMALINK

optical weenie:

Could be - I am skeptical as well. But, things are looking real, real bad. Do you agree?

TCD

Posted by: The Conservative Deflator on July 21, 2008 at 1:54 PM | PERMALINK

I have to agree with Weenie here. I've been hearing about those camps since the 60's. First it was the DFH's were gonna get locked up, then the Real Patriots, and now the American Insurgents.

What's changed is we're all going to get trucked there on the NAFTA Superhighway now.

Posted by: thersites on July 21, 2008 at 1:56 PM | PERMALINK

If you are the wealthy vice-chairman of a global financial services company and an economist with a thousand-mile look at the numbers, then yes, the economy looks sluggish-but-sound, and saying anything else is evidence of self-delusion, not your own disconnection with the lives of the average citizen.

Posted by: grape_crush on July 21, 2008 at 2:00 PM | PERMALINK

If we get to the point where "insurgency" is even remotely possible, neither camps or gated communities will help the people currently in power.

Remember America survived the great depression without a revolution. We will probably react the same way when faced with the next depression. Massive government jobs programs and an enhanced safety net.

In the long run I am pretty bullish on America. We just have to elect some people who really care about actually solving problems.

Posted by: Ron Byers on July 21, 2008 at 2:12 PM | PERMALINK

Roy Edroso kicks ass. Someone should give him and John Cole a bloggingheads episode on the strangeness or right-wing bloggers in the age of Bush.

Posted by: Mike on July 21, 2008 at 2:13 PM | PERMALINK

Well, going door to door in a midwest city neighborhood with primarily African American residents, I asked voters what their greatest concern was. I got one reply of health insurance, one of energy and two who wanted the Iraq war to end. The rest were all extremely worried about their own precarious financial situations and the economy in general.

I would really enjoy seeing the likes of Edroso trying to persuade them that it's all beer and pretzels--that they are somehow missing all their wonderful opportunities and a fat bank account somewhere with their name on it.

Posted by: cowalker on July 21, 2008 at 2:15 PM | PERMALINK

Economics in America is mostly concerned with returns on investments, not the living standards of the people who live within the economy or how the wealth that is generated by the economy is distributed. By that measure, as long as the wealthy continue to add to their wealth, the economy is doing great. Why cannot the bottom 95% understand that and thank the invisible hand that makes this economy the best of all possible economies?

Posted by: Brojo on July 21, 2008 at 2:29 PM | PERMALINK

Why cannot the bottom 95% understand that and thank the invisible hand that makes this economy the best of all possible economies?
Posted by: Brojo on July 21, 2008 at 2:29 PM

They are all a bunch of ungrateful whiners.

Posted by: on July 21, 2008 at 2:38 PM | PERMALINK

TCD,
I think people are over reacting and I don't think the sky is going to drop down on us. Are we going through a slow down? Yes. But so what. All economies do this, on a fairly regular basis. We can't be eating cake all the time you know.
Basically I agree with Ron Byers -In the long run I am pretty bullish on America. We just have to elect some people who really care about actually solving problems.

Posted by: optical weenie on July 21, 2008 at 2:46 PM | PERMALINK

In the long run I am pretty bullish on America. We just have to elect some people who really care about actually solving problems.

It seems your first sentence is undermined by your second.

Posted by: drjimcooper on July 21, 2008 at 2:47 PM | PERMALINK

Time to try and hijack a dull thread.

Did anyone see Dowd's and Kristof's pieces from Sunday? Dowd's up to her usual closeted Republican tricks claiming the Obama's got a lot of hard work ahead making it sound like he's anywhere from 5-10 points behind McCain rather than 5-10 points ahead, and Kristof wrote a piece about ". . . we boomers . . ." Kristof is 49 years old. Where does he get off thinking of himself as a boomer? He's only about five years too old to be the child of a boomer.

Posted by: Jeff II on July 21, 2008 at 3:02 PM | PERMALINK

"Could this be the year in which Mencken's Law is broken, and somebody goes broke underestimating the intelligence of the American people?"

Don't hold your breath.

Posted by: on July 21, 2008 at 3:17 PM | PERMALINK

Obama is playing Reagan to McCain's Carter by in effect negotiating for the release of the 150,000 Americans currently being held hostage in Iraq.

Posted by: lampwick on July 21, 2008 at 3:18 PM | PERMALINK

Economics in America is mostly concerned with returns on investments, not the living standards of the people who live within the economy or how the wealth that is generated by the economy is distributed. Posted by: Brojo

Economics is actually a pretty neutered and descriptive field. I think you are confusing economics with what is taught in B-school. This is where social Darwinism meets Barnum & Bailey.

Posted by: Jeff II on July 21, 2008 at 3:25 PM | PERMALINK

Don't hold your breath.

Do hold your breath, until you pass out, like I used to angrily do. The Color-flashes before hitting the ground are awesome. -John McCain

Posted by: on July 21, 2008 at 3:45 PM | PERMALINK

Economics in America is mostly concerned with returns on investments, not the living standards of the people who live within the economy or how the wealth that is generated by the economy is distributed. Posted by: Brojo

if i sink a buck into my business and i don't get a return on my investment of something more than a buck, i don't eat. i take it you skipped economics.

if you think the distribution of wealth is bad in this country you need to get out more often.

that said, anyone who claims the economy is good is transparently full of shit. it's going to be slow for awful long time.

oh and the usual definition of a boomer is anyone born between 46 and 64 (ease to remember; just flip the numbers). that makes the youngest boomer 43 turning 44 this year. kristof qualifies.

Posted by: mudwall jackson on July 21, 2008 at 4:08 PM | PERMALINK

Why do you ask, have you heard something about Kenneth Pollack going bankrupt?

Posted by: on July 21, 2008 at 4:23 PM | PERMALINK

Sean Hannity has 100 million reasons to reply "No" to Mr. Edroso's question.

Posted by: on July 21, 2008 at 4:39 PM | PERMALINK

Seems to me years like this are precisely what Mencken's law is about. My money's on McCain.

Posted by: Señor Ding-Dong on July 21, 2008 at 4:42 PM | PERMALINK

brojo,

if i sink a buck into my business and i don't get something back in return, i don't eat. my living standard goes to zero. that's basic economics. if i don't get a return on my investment i don't hire, i don't spend, the economy loses one (extremely) minor cog. i'm not a rich guy; just someone trying to scratch out a living. i'm a lifelong democrat, pro union son and grandson of men who stuck out their necks to organize their workplaces during a time in our history when union busting meant busting heads. if you think the system here stinks, look at the living standards of 80 percent of the world's population. my wife comes from a country where highly educated professionals don't make enough to live on, where the only hope for many is to come here, or canada, or japan or the middle east where they can earn a decent pay check and send money home. the genius of our system isn't that it's perfect but rather that the tools are there to make it better. we just have to use them.

Posted by: on July 21, 2008 at 4:48 PM | PERMALINK

oh and the usual definition of a boomer is anyone born between 46 and 64 (ease to remember; just flip the numbers). that makes the youngest boomer 43 turning 44 this year. kristof qualifies. Posted by: mudwall jackson

Naa. That's nonsense. I've read all that before. Kristof is part of a second "baby boom" unrelated to the one that followed in the first few years after WWII - couples who either put off having children until after the war or married just after the war and started families straight away. The second baby boom is similar except that it was post-Korean War.

But it's not just a matter of demographics or even timing. Sociologically the Boomers are a generation distinct from ours just as the Boomers are sociologically different from the youth that came of age during the Eisenhower years (Elvis vs. the Beatles, if you will). Again, if you use the arbitrary beginning and ending, Kristof is almost young enough to be the child of a true Boomer.

Other than being a carbon based life form and, perhaps, preferring pop music, I have nothing in common with the likes of Bill and Hillary Clinton, John McCain, Shrub, Cheney, Pelosi, Rush Limbaugh, etc., all people who came of age in the 1960s. These are the Boomers - people now in their early sixties. I'm not a Boomer and neither is Kristof.

Posted by: Jeff II on July 21, 2008 at 4:51 PM | PERMALINK

Could this be the year in which Mencken's Law is broken, and somebody goes broke underestimating the intelligence of the American people?

American people are intelligent. They are aggressive consumers when credit is cheap and abundant and they will pullback when credit is expensive and hard to find. That is intelligent behavior and is unfolding as expected. Some people with rose colored glasses underestimate American intelligence and expect the public to keep up their spending ways even when times are tough just so they (the eternal optimists) can look good with their rose colored glasses.

Posted by: rational on July 21, 2008 at 5:15 PM | PERMALINK

if i sink a buck into my business and i don't get something back in return, i don't eat. my living standard goes to zero. that's basic economics.

That is not basic economics in America. In America what happens to mudwall jackson and those like the anonymous commenter at 4:48 PM are of no consequence. In America the economy is doing well when Exxon and General Electric make something back on their investments and the economy does poorly when they do not. In America recessions are measured by growth of corporate profits, not whether living standards decline for the bottom 95%.

Posted by: Brojo on July 21, 2008 at 5:36 PM | PERMALINK

American people are intelligent. They are aggressive consumers when credit is cheap and abundant and they will pullback when credit is expensive and hard to find. Posted by: rational

Oh. So that's why the typical American household, with one of the lowest savings rate in the world, has something like $8,000.00 in revolving credit debt, and has had for about five years, and is paying anywhere from 12%-16% interest. Yup. Americans are real smart cookies when it comes to personal finance.

Posted by: Jeff II on July 21, 2008 at 5:42 PM | PERMALINK

Jeff II, I'm with you on the whole credit crisis. Been watching and anticipating this crisis for a while now, so I certainly agree with your general observation about the American household.

You have to read my comments in a slightly different light. I'm pointing out that though Americans were stupid enough to extend themselves when conditions allowed for it, they are smart enough (not necessarily by choice, some of it is forced on them) to pullback now that the tide has turned. The smart bet is to acknowledge this reality and be prepared for an economic pullback. The dumb bet, which the conservatives are making, is that the American consumer will continue spending even when they have no means to do so.

I agree that intelligent people don't extend their credit lines, but relatively speaking, pulling back in the face of tighter credit conditions is more intelligent than continuing the same old spending patterns without acknowledging reality.

Posted by: rational on July 21, 2008 at 6:06 PM | PERMALINK

JeffII, 1946-64 are the now nearly universally accepted parameters of the post-WWII baby boom. I'm not sure why you're lumping John McCain, who's 72 this year, and Nancy Pelosi, who's 68, in with the others you mention. Do you have a cite for this "real" baby boom you mention?

Posted by: shortstop on July 21, 2008 at 6:31 PM | PERMALINK

One of the things has really struck me about this financial meltdown is how in denial Republicans are about it. I think they refuse to face the facts because it tarnishes the Moneycons: bringers of great wealth to The Party. I've pretty much stopped reading RedState since they went to an All-Obama-All-The-Time format on the front page, but I dropped by the other day to see how the IndyMac failure was going over there. The lone front page blogger who ever talks about economic issues had done a post that got a whopping two comments before falling off the front page into the dust bin of blogging history.

Either they don't care, they don't want to know, or the Pavlovian dog response has them unable to focus on anything beyond yet another tirade about those dirty hippies (Black ones now, too!!) trying to take over the country and sell all the good Christians in to eternal slavery to the ebil gubbermint.

I guess maybe they CAN'T care...the Wall Street boys have been a major part of "the base" and they just can't bring themselves to admit that their favorite sons have been running an operation the Mafia would be proud to take credit for.

The best I've seen any of them come up with is "these banks are all in trouble because the government made them loan money so that minorities could buy houses that they didn't deserve."

The mind boggles.

Posted by: Art Eclectic on July 21, 2008 at 6:45 PM | PERMALINK

JeffII, 1946-64 are the now nearly universally accepted parameters of the post-WWII baby boom. . . . Do you have a cite for this "real" baby boom you mention?

"Cite?" I don't need no stinking "cite."

I'm aware of what the "universally accepted" years are but, as I said, it's nonsense to lump together groups separated by almost 20 years.

I have very little in common culturally with the people born in the first few years after WWII who, again, are nearly old enough to be my parents, and people born in 1964 have even less in common with them. It makes no sense in terms of economic status, cultural background and historical perspective to compress that many years and think that there is some sort of commonality. Someone born in 1946 could have served in Vietnam. Someone born in 1964 probably has little memory of the war. The same is true of the Civil Rights movement and the Kennedy assassination, touchstones for people born in 1946, but almost meaningless to someone born in 1964 (or 1959).

I'm not sure why you're lumping John McCain, who's 72 this year, and Nancy Pelosi, who's 68, in with the others you mention. Posted by: shortstop

Because I fucked-up?

I didn't realize Pelosi was so old. (Botox is a wonderful thing.) And the McCain slip was just plain bone headedness.

Posted by: Jeff II on July 21, 2008 at 7:25 PM | PERMALINK

the genius of our system isn't that it's perfect but rather that the tools are there to make it better.

Too bad the Rethugs have been working overtime to eliminate those tools.

Posted by: on July 22, 2008 at 2:08 PM | PERMALINK

Didn't the XFL already disprove Mencken's law?

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