Black Monday: Judgment Day 5769

My mind is reeling as I type these words, words that I record with great apprehension for what the future may hold. We are nearing the close of a momentous Monday. The date is September 29th, 2008. It is the first night of Rosh Hashanah,¹ the Jewish New Year that doubles as the Jewish Day of Judgment.² And let me tell you, buddy, it couldn’t have come at a worse time...

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This day will go down in the history books as “Black Monday,” or something to that effect, and why not? The U.S. stock market fell more than 7% today, with the Dow finishing some 778 points down. They are calling it the largest single-day loss in the market’s history, and the TV pundits all seem to agree that the stock-market's free-fall is directly attributable to the failure of Congress to pass a bailout measure of unprecedented size and scope. The market had been falling throughout the day, as rumors of the bill’s likely defeat made their way to Wall Street. When the final word came, at approximately 3:00 PM ET, the market took a final plunge before closing to record losses.

Suze Orman is pissed. CNN has her answering viewer questions during both Larry King Live and AC 360, presumably to calm viewers who believe the day of the apocalypse is upon us. But Suze is not as reassuring as usual. She sounds alarmist and angry, and she insists that congress has made a huge mistake. And you know what? I agree with her. This market crisis has been anticipated for over a year now: I have read dozens of articles and op-eds on the sub-prime mortgage mess that specifically worried that credit might dry up. The $700 billion dollar federal buy-in was a last-ditch effort to inject what economists refer to as “liquidity."

The bailout plan was put forth by the Bush administration, and was vigorously supported by both Secretary of the Treasury Hank Paulson and Ben Bernanke, the chairman of the Federal Board of Reserve. Both parties’ presidential candidates were outspoken in support of the bill’s passage, although as senators they were forced to watch from the sidelines while the bill sank.

Actually, John McCain did try to jump head-first into the house negotiations last Wednesday, temporarily “suspending” his presidential campaign less than 40 days before the election in order to address the issue. The congressional negotiations were promptly buried under a hail of media coverage, yet it might be suggested that it was precisely this sudden surge of media coverage that galvanized millions of voters to contact their congresspersons in vigorous opposition to the bill’s passage!

When pundits opine that the problem boils down to a failure of leadership, what they mean is this: The people who failed to lead were the hundred or so congressmen who caved to the pressure from their constituents and voted against the bill in spite of pressure from the president, the secretary, the chairman, the speaker, the minority leader, and both presidential candidates. A segment of the Republican caucus had maintained opposition all along on the basis of free-market principles, but many others were simply fearful of defeat in the approaching congressional elections. The tail can sometimes wag the dog. But is it ever truly smarter?

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There is a funny problem underlying today’s turmoil. Legislators had made today a deadline for action for a specific, albeit unpublicized, reason: There will be no meetings in congress tomorrow because too many Jewish members will be away for High Holiday Services. Barney Frank says that he won’t be able to work on this tomorrow because of Rosh Hashanah, although he goes on to invite his colleagues to continue working on the bill. Anderson Cooper is flustered and confused. I can’t wait to see what Jon Stewart will have to say. Or will he even be on tonight? He may well be taking the holiday off…

In fact, Pelosi acknowledged the Jewish members of her caucus during her speech from the floor of the house earlier today.³ You also have to wonder what will happen tomorrow morning. When the gentile investment bankers in New York City show up for work, many of their Jewish co-workers will be absent. Let’s just say that there’s more than a kernel of truth to stereotypes about the number of Jews in finance. So what effect will their absences have on day-after functioning of the market?

There has been little commentary on the role of the Jewish holiday in today’s events. However, Pelosi’s speech generated quite a bit of controversy after Republican Minority Leader John Boehner suggested that its “partisan rhetoric” had prevented as many as 12 Republicans from voting for the bill. Barney Frank points out later that by some feat of “numerology,” 12 is exactly the number of additional Republican votes that was needed to pass the bailout package.

The House Democratic leadership held a press conference at 3:00 PM to announce the bill’s defeat. After a few brief comments from Speaker Pelosi and Frank, who is the Chairman of the House Finance Committee, the first question is addressed to Speaker Pelosi. A reporter asks her about Boehner’s accusation that her speech had sunk the vote. Frank answers for her, ridiculing the notion that Republican lawmakers decided to “punish the country” because their “feelings were hurt.” The line ends up in every network’s coverage of the night’s lead story, along with quotes from the Speaker’s speech and the Minority Leader’s response.

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Notes: 1) The year is 5769 on the Jewish calendar, meaning that there have now been five thousand seven hundred and sixty-ninth years since the moment of creation, according to Jewish tradition. 2) Yom Kippur, which follows in a week and a half, is properly regarded as the Day of Atonement, when we attempt the have any bad verdict overturned on appeal, so to speak. 3) I caught a re-run on C-Span, which marked the time of the speech as 12:20 PM ET.

Taking Sides

From my Harvard classmate Josh Patashnik over at The New Republic:

The fervor this campaign has unleased is a grim reminder of how far removed this textbook conception of the political process often is from reality. Politics can easily end up being tribal, not rational; there's a natural urge to pick a side and defend it, regardless of the ideological stakes involved. The longer the fight goes on and the closer the race appears, the deeper the divide becomes--it takes on a life of its own and before you know it you have irate activists traveling thousands of miles to Washington in passionate opposition to the fair and legitimate nomination of a candidate whose views they agree with. In short, the problem is not that demography determined the outcome of the Democratic race--it's that people (journalists included!) became so emotionally invested in such a superficial contest.

News Flash: Clinton Overwhelming Choice Among Poorly Educated and Uninformed

The Gallup website has posted a number of articles on the stark differences in support by education level being received by Hillary Clinton and Barack Obama in the Democratic Primary race. This recent article summarizes the general trend:

In the overall sample of 7,999 non-Hispanic white Democratic voters Gallup interviewed between April 1 and April 26, Clinton beats Obama by a 49% to 42% margin. As seen above, Clinton gains this winning margin in part because of her very high percentage of support among those with lower education levels. Obama's support among the well-educated is not strong enough to counteract Clinton's strength among the less well-educated.

Now go ahead and accuse me of "elitism" if you like, but why hasn't it occurred to people that college-educated people are far more likely to actually know something about the respective candidates and to have some idea of what their policies are, as well as their implications? Doesn't the disproportionate support that Obama receives from educated Whites across all age brackets indicate that they may understand something about the two candidates that the less-informed, more apathetic uneducated voters have simply missed? In particular, I have noted that Obama repeatedly appeals to subtleties and nuances in word and policy when explaining his plans or his apparently all-important gaffes. The MSM, which is made up primarily of people who have college degrees but try as hard as possible to forget everything they have learned, has tended to completely miss these subtleties and nuances, but this is an enormous problem, because political office is all about carefully weighing decisions and making fine distinctions. It seems to me that the people who know how to do this are supporting Obama in a freakishly disproportionate manner. One further note: What percentage of college-educated whites would support Obama if we removed the effect of the feminists? I think it's fair to assume that the majority of ardent feminists in the U.S. are white and college-educated, and they vote overwhelmingly for Clinton. Take out these women, and the number of college-educated whites voting for Hillary probably shrinks to a tiny, insignificant percentage.

From a recent Gallup report:

"...from the moment he appeared on the national scene as a serious Democratic contender, Obama's appeal has been strongly skewed toward those with high levels of education, while Clinton has been the dominant favorite of those with less education."

Feminism and the 2008 Democratic Primary

Michelle Goldberg of The Guardian brilliantly skewers the argument that equates feminism with a vote for Hillary Clinton, and the false feminists who make this claim. She also makes this point, which I recently made to an associate who would not acknowledge its accuracy:

If the roles were reversed, if Obama were behind by every metric, Clinton would have been coroneted by now, and the cry for her opponent to get out and quit being a spoiler would be deafening.

See the post for some really ridiculous rhetoric by radical feminists attack female supporters of Obama (who, it should be noted, have been in the minority in nearly every state outside of Illinois).

Tales of Rhetorical Hypocrisy, Part 1: Bush and Diplomacy

From the International Herald Tribune, Adam Nagourney writes:

Without using Obama's name, President George W. Bush, at a White House news conference on Thursday, assailed his willingness to meet Cuba's new leader, Raúl Castro, without preconditions, saying that to do so would grant "great status to those who have suppressed human rights and human dignity."

What, you mean people like Pervez Musharraf, Vladimir Putin, the Saudi Royalty, and the Communist Party leaders of the People's Republic of China? Yeah, Presidents should never meet with those dudes without preconditions. Who would even think of doing such things?

Hypocrite Conservatives Can't Adhere to Their Self-Proclaimed Principles

The Democratic House passed a new bill yesterday providing incentives to encourage the production of green energy technologies. Everyone in Washington seems to support the idea of encouraging the development of technologies. So why has President Bush threatened to veto the legislation? Well, to offset the increase in spending of approximately $17 billion, the bill cuts subsidies to oil and natural gas companies. Republicans in the house have been calling this "a tax on oil production." This is a shameless tactic that the Republicans have been using in spades: equating anything that increases the tax burden on any entity with a tax increase. It is false by definition. You see, all American-owned corporations are required to pay taxes. But if your industry just happens to be one that formerly employed the current president, turns out he's willing to give you a huge tax break, simply because you are already making such ridiculously large piles of money at the expense of the American consumer. Isn't that swell? It's not a tax increase - it merely requires that the fossil fuel empires who are currently trying to destroy our planet pay the same taxes as every other corporation or business. So where's the hypochrisy? In the NYT article, Republicans are quoted as saying that the bill would definitely pass (I guess they means it wouldn't be vetoed, since it has already passed) if only those restrictive "taxes" on oil companies were there. Why can't the Dems just pass legislation with the incentives for green energy, no strings attached? Apparently, the Democrats are adhering to a policy known as fiscal conservatism (that's right, conservatism), which requires the government to only spend as much money as it earns. Republicans have suddenly begun denouncing reckless spending, a phenomenon that manifested itself suddenly on a Tuesday night in November of 2006. I guess they felt that after six years of running up massive deficits, it was time for them to tighten their belt - if only the Dems would listen to them! The takeaway here is: House Republicans are full of sh*t.