Delay = RINO
 

Republican In Name Only.

Thoughts?
 

Don't we solve this problem by opening our borders to intelligent younger people from around the globe, leaving other countries to deal with aging populations without the benefit of our workforce? I do not mean this entirely in jest. Dealing with a disproportionate number of older people in India, for example, is relatively less expensive, and the kids working here would be able to contribute heavily to maintaining their parents. Shifting the burden can be a net positive all the way around, especially if many of the foreign workers coming here ultimately go back.

I think we sould be loosening immigration restrictions now in prepartion. Perhaps establishing 10 or 20 year brain drain visas.

And thank you for the RINO response.

Why hasn't anyone mentioned that Rubin's theory (i.e., that there is a connection between high deficits and high interest rates) has been proven incorrect?

Delay = RINO
 

The Captain had no problem understanding what I was saying. And he was the one I was talking to. Here was his response, and in my view shows full comprehension of my point.

"I am happy to admit that budget numbers have some level of dynamism and don't respond in a straight line. As you note, there are many factors. These factors, of course, will go both ways.

But given the extraordinary differential (50% growth in GDP, 100% growth in receipts), I am not going to be convinced until you show some evidence that the dynamic factors have that big an impact.

Bracket creep, for example, can increase the rate by a percentage on income over a given level, but that is not a 50% increase in tax revenue."

Delay = RINO
 

Actually my request from evidence was for Tyrones theory about Bush doctoring the numbers.

I am not saying that Bond Markets are that connected to economic health. What I am saying is that they are connected to the federal deficit. Bond traders want to make them low to be competitive, however, if they make them too low and the Federal budget deficit gets out of hand they will end up losing money. These guys have more of a vested interest in predicting the future deficit than anyone else. In addition, what they set the long term rates at can have a significant effect on the economy. That is why Clinton found them so important. If he could convince the bond market that there would be fiscal discipline then the long term rates would go down and the economy would boom. With Rubin as the Treasury Secretary (a former bond trader) and Clinton being the head of the party, the bond market thought that he might be able to reign in Congress. When it was clear that he could not ("the 93 deficit pact") then the bond traders increased the rates because they thought deficits were going to explode. Once the Republican came in the bond markets thought there would be fiscal dicsipline so they lowered their rates. These contributed to the economic boom that lead to the balanced budget.

Just compensation
 

If everyone gets their property back there won't be any redesign. You can't make a new map when the old map is locked in. Any redesign is going to involve the confiscation of private property.

Thoughts?
 

I don't think this is a joke at all. This is exactly what we need to do. One of the reason this country has been so successful economically is that we steal all the best minds and entrepeneurs from other countrys. By definition, anyone that is willing to leave their home and travel to a foreign land where they don't speak the language, is a risk taker. In other words, the personality of an entrepenuer that will help drive this country.

Immigration is very important to this countrys future.

Just compensation
 

Ummmmmmmmmm it seems like it is possible that people might sell their property on, like, you know, the market. How much of the area that most needs a redesign is residential owner-occupied versus nonresidential or residential non-owner-occupied?

Was there a mass confiscation in Chicago after the fire? In Galveston after the 1900 hurricane? I'm actually genuinely curious.

Delay = RINO
 

I have not been around bond traders in a while (by the way the real trendsetters are not the guys in the pit). But I was in this world from 92-96. These guys predict future budget deficits for a living and their income depends on such predictions. So they can't afford to get involved in partisan B.S. That is why I think their opinion is a good one.

I know what the conventional wisdom was at the time. After the 93 act, it looked as though the only way Clinton was going to balance the budget was to keep raising taxes. His tax increase did not solve the problem and spending had actually gone up. So if spending was going to continue to go up, Clinton was going to have to keep raising taxes to get where he wanted to go. The Bond markets did not like that scenario.

Before the Republicans came in, and when he was working with the Dems Clinton was the voice for Fiscal restraint. However, Congress would not accept most of Clintons proposed cuts and just accepted his proposed tax increase. But when the Republicans came to town, and the Republican proposals came through, Clinton thought that the Republican cuts were too deep (they were not actually cuts, but reductions in growth). There are strong arguments for what Clinton did. The cuts may have been too deep. However, there is no question that he put these domestic programs over fiscal discipline. You can argue if this was the right move, but there is no question that is what he did.

Clinton fought budget cuts from 94 until the end of his presidency. So to give him credit for balancing the budget is just absurd. It is like giving him credit for welfare reform.

If the Republicans had not come in 94, the only way out of the mess was to keep raising taxes every year and I just don't think there was the political will to do it. And the Dems were not going to make the necessary cuts.

In the partisan political game the President is given credit or demerits for everything that happens during their tenure. But the more discerning citizen realize this is just partisan B.S. Especially when the President's party does not control congress.

However, since Bush came to office, and he has shown amazing control of Congress, I think it is fair to give Bush credit or demerits for everything that has happened since he has been president. For the first time since Lyndon Johnson, the presidents budgets have actually become reality.

As for why the long term bond rates are still low is a mystery to me. I am not in that world anymore. I would think they would be higher. My suspicion is that the markets thought the deficits were necessary to create growth and that growth would lead us back to balanced budgets. But with Delay's talk of already cutting all the fat I, I would be really sckeptical if I were a bond trader. But maybe they know something I don't.

This was not Rubins theory, but the conventional wisdom of the bond markets. The bond markets definitely don't think this has been proven incorrect. I don't buy the Republican propaganda about Rubin. Without him things would have really gotten out of hand from 92-94. In addition, if the Republicans had not come to power in 1994 he would have been the person holding us back from disaster.

In addition, he argued that the Republican spending cuts were not necessary because economic growth would pull us out of the deficits sooner than people thought. He was right. I think the spending cuts would have been a good thing, but the guys knew his stuff.

Delay = RINO
 

2. Although Ty will find a blog to refute this.

Delay = RINO
 

Brad DeLong has been pointing out when they do this for three or four years. I don't have time to go through all of his archives, but here is a recent example, as discussed in The Economist.

I don't mean theory in the literal sense, but it was his guiding management principle. How could they not think it? We've had massively growing deficits for 5 years, while rates have (until recently) been near historic low levels.

Delay = RINO
 

No -- I was the one who asked for a shred of (reputable) evidence linking the bond markets and the party in Congress. I'm still waiting.

Another B.S. warning?
 

Anyone get this in their email. I assume it is B.S. because there is not actual specific cite for the information but I was just curious.


Please read Warning

Police officers working with the DARE program have issued this
warning: If you are driving after dark and see an on-coming car with no headlights on, DO NOT FLASH YOUR LIGHTS AT THEM! This is a common Bloods gang member "initiation game" that goes like this: The new gang member under initiation drives along with no headlights,and the first car to flash their headlights at him is now his "target".He is now required to turn around and chase that car, then shoot and kill every individual in the vehicle in order to complete his initiationrequirements.

Police Depts across the nation are being warned that September
23rd and 24th is the "blood" initiation weekend. Their intent is to have all thenew bloods nationwide drive around on Friday and Saturday nights with their headlights off. In order to be accepted into the gang, they have to shoot and kill all individuals in the first auto that does a courtesyflash to warn them that their lights are off. Make sure you share this information with all the drivers in your family!

Please Forward this message to all your friends and family members toinform them about this initiation ritual. You can save someone's life ifyou heed to this warning.

Delay = RINO
 

You come from such an absurd position that it is hard to know what to say. I might have a theory that Bush is really a catholic but he just hides it. There is no way to ever prove or disprove that theory. Same with this theory. Unless someone leaks that this is what happened this theory can never go beyond speculation.

Yet because people have been talking about the possibility that this might have happened you talk about it as if it were a fact. Just because people are suggesting this is a possiblity does not make it true.

Delay = RINO
 

Again. You make these ridiculous comments. It was like when you were questioning whether Roosevelt wanted to get us into WWII, or was misleading the American public about his intentions about WWII. It is conventional wisdom. You kept asking for a cite but everyone ignored you because it is like you were questioning whether or not the sky is blue. I am not going to look for a cite teling you the sky is blue.

You questioned the buses and wanted a cite from a reputable news source. Of course I didn't go looking for one because you were being ridiculous again. When I picked up the economist that week and read the lead story, what did this London based newspaper talk about in their lead story? the buses.

Now you are asking for a cite to support the fact that the bond markets care which party is in congress and what they are up to. Why should anyone look for a cite for something that is so patently obvious. Bond traders are always trying to predict future federal budgets. Why would they not factor in what party controlled congress and what they are up to. It is so absurd it is not even worth replying to.

Delay = RINO
 

2. Someone has needed to say this for years, but only someone with Spank's Gravitas could do it effectively. Time for a sock change Ty. slave, when do i get the keys to this place?

These long term mortgage rates are set by people (not by Greenspan). The rates reflect what the mortgage traders (the market) think the future federal deficits will be. For some reason they are optimistic about future US budgets. I am no longer in these circles so I have no idea why they think that. All I can assume is that they know something we don't.

I should also point out that during the Reagan era that the markets had no confidence in the Dem congress balancing the budget or in Reagan being able to get them to pass anything close to balanced budgets. I could be wrong, but I am pretty sure they were really high in the 80s (higher than 8).

Just compensation
 

Not really. If the redesign means their property is under water, that's not a taking, that's your own bad luck. If we decided to abandon new orleans, as I've been saying we should for the most part, it's not a taking. they can still live there, with scuba gear.

And fringe this gives me an opportunity to respond to your FB post in teh right place.

If the oil companies need a place for their workers, why should the rest of the country pay for that? Same for the railroad cos. I know that you support Bush and all, but isn't doing so a bit much even for you? Instead of rebuilding the low lying areas of the city so that roughnecks can live there, why not take the money and get teh oil companies to kick in their share too to build a 20 lane highway to allow workers to commute super fast from Baton Rouge or somewhere above sea level. Same for the rail junctions. If people just work there, they can send them home once a decade for the bad storms.

Another B.S. warning?
 

Its an internet scam, but as a precaution, nightly when I drive through the hood, sts, I make a point to flash all of the other cars, whether their headlights are on or off.

People need to take on the criminals and not appease their lawlessness. Of course, I am madd-packing with my Nine, so those shorties don't want be frontin' on me.

Delay = RINO
 

2. I love Ty like a wayward friend from college who remained drunk and drugged out long after that behaviour was age-appropriate, platonically, but someone needs to say this to him. I hope late at night when he alone with his thoughts, after the wife and kids have gone to sleep and left him to pursue his internet bloggery, that he can think beyond the intoxicating affects of his Zinfandel or Pinot and realise that we have his best interest at heart in trying to get him to see the light of day here.

I pray it be so. please babyjesuschristsuperstar, smile on Ty.

Just compensation
 

Got to disagree with you here. I have kept saying, and no one has ever been able to show me that I am wrong, that the Feds were responsible for the levees. The levees broke so the Feds are responsible for the damage. If someone's house is under water the Feds have to cough up for it.

Am I missing something? Why am I wrong?

Another B.S. warning?
 

This was common knowledge in LA - I had a friend in the DAs office that confirmed it.

I think this simplifies things somewhat and looks slightly to the wrong place. Bond traders look to what the likely rate of inflation will be, which is influenced by a host of factors, including both monetary and fiscal policy. In the 70s, monetary policy was inflationary. Reversal in the early 80s caused a predictable recession. Until Greenspan came in, monetary policy had generally been loose for quite some time. And until he made clear that a tight monetary policy (or a reasonable one--expanding money supply in close relationship to growth) was here to stay, we had higher bond rates because people were worried about more inflation.

Fiscal policy plays only a secondary role, especially on the long bonds (such as mortgages, which generally are treated about like 10 year bonds). The main concern is that if we run continuing deficits we will have inflation, either because there's too much money chasing too few goods or because eventually we'll have to inflate our way out of the deficit. Greenspan has, through long-term work, convinced bond investors that the latter will not happen. Until the deficit (and, more important) the debt becomes too large to make continuing that approach infeasible, people believe it, or at least think the risk of a diferent approach is quite low.

So, don't tie it to Congress any more, other than to thank them for confirming repeatedly Reagan's pick for Chairman of the Fed.

That all may be well and good, but it doesn't change the fact that the previously assumption (big deficits = higher interest rates) has not held up in the 21st Century.

Just compensation
 

1) Soveriegn immunity/Fed. Tort Claims limit
2) Practical limits . . .

If your proposition is correct, any time any person suffered a loss of property that could have been prevented through more/greater/better government action, they would have a taking claim.

Your proposition is doubly dubious given that the levees were not designed to withstand a storm of this strength. So you don't have what in the tort world might be a product liability claim that the levees didn't do as promised. They did, but they never promised to stop everything.

So, I don't know if it counts as showing you that you are wrong, but many articles, including some I'm sure in the Economist, will explain that (construction defects aside) the levees were not designed to stop Katrina. And they didn't.

Another B.S. warning?
 

Club, if you believe this then certainly you believe that the Clintons killed Vince Foster, yes?

Another B.S. warning?
 

Clintons? Do you have any evidence Bill even knew she was going to do it?

Ah, we're five years into the new century. Let's not throw away the economics texts and subscribe to the dogma of Dick "Deficits Don't Matter" Cheney just yet.

There are some who have attributed at least part of this phenomena to external factors. One example I remember in WaPo by Sebastian Mallaby:

• But the most remarkable aspect of Bush's good fortune is the way he's repeatedly avoided the retribution of markets.
  
  When Bush passed his tax cuts and followed them up by including prescription drugs in Medicare and increasing the Pentagon's budget, some kind of market reckoning seemed inevitable. After all, extra government borrowing means less available capital and therefore higher interest rates; and if bond rates are attractive, investors will avoid the risk of buying equities and so deflate the stock market. At the same time, extra government borrowing stokes consumption, including consumption of imports. Those imports have to be paid for with capital from foreigners; to entice foreigners to provide it, the dollar may have to fall enough to make U.S. assets a bargain.
  
  But almost none of this has happened. Yes, the trade deficit is at an all-time high, and last year -- conveniently, after the election -- the dollar fell enough to get people nervous. But this year, the trade deficit notwithstanding, the dollar has bounced back again. Meanwhile, long-term interest rates are actually lower now than they were one year ago. The stock market has been amiably docile.
  
  What gives? Certainly not something that Bush could have predicted. Foreigners have decided to shower the United States with savings, so the pain from his guns -- and prescription drugs -- and butter policy has been magically anesthetized. The more Bush pushed up the government's borrowing, the more foreigners eagerly opened their wallets. Hence no shortage of capital, no higher long-term interest rates and no falling dollar.
  
  To appreciate the extraordinary extent of this good fortune, consider what one means by "foreigners." It's not merely that one country, or even one group of countries, has decided to litter the United States with cash. For Bush's winning streak to hold, it's taken one lucky break after another -- three, to be precise.
  
  First came Asia's central banks. In 2003 and 2004 they decided to keep their currencies cheap by selling them and buying dollars. The Japanese, for example, increased their holdings of U.S. Treasurys by an astonishing $312 billion, a sum equivalent to three-quarters of the 2004 Bush deficit, according to Brad Setser of Roubini Global Economics, a consultancy in New York.
  
  There was nothing inevitable or predictable about this. The Bank of Japan could perfectly well have chosen not to buy dollars or amass Treasurys; in fact, in the spring of 2004 it did stop buying dollars, and its accumulation of Treasurys stopped in the fall. But in 2003 and most of 2004, when the Bush budget deficits were exploding, American voters were spared the usual consequences. Indeed, the housing market, one of the most interest-rate-sensitive sectors of the economy, boomed instead of succumbing to the expected tailspin. Low interest rates fueled a refinancing binge, delivering the growth that Bush needed for his reelection drive.
  
  When the Japanese stopped financing the Bush deficit, a combination of China and assorted oil states came to the rescue. Because of its growing trade surplus, China is awash in dollars; because of high energy prices, oil exporters such as Russia are drowning in dollars, too. So the Russians and the Chinese, not exactly the coziest of U.S. allies, are now financing the Bush deficit, including that part of the deficit that's driven by the Pentagon's determination to contain China.
  
  Again, there's nothing inevitable about the Russian or Chinese decisions. They could take their oil earnings and export earnings and park them entirely in euros. But, to complete Bush's lucky sequence, the Europeans have done their best to drive loose savings elsewhere. Their sclerotic economies offer few opportunities for investors, and the Franco-Dutch rejection of the European constitution has shaken business confidence in the euro.
  
  So thanks to Asian central bankers, cash-rich oil states and testy European voters, Bush has escaped the consequences of his profligacy -- and now, because the economy is growing, the budget deficit is coming down. In the long term, to be sure, Bush has put the federal government on an unsustainable financial glide path, and one day the foreigners will refuse to keep us airborne. But there's no justice in politics. The comedown may not happen on Bush's presidential watch.

The way I understand it, with the long term rates the budget deficit is a big factor. If you have high deficits then everyone assumes there will be inflationary pressure. So for the long term the deficit is a big deal. Greenspan can fight inflation but if the deficits remain high, he has to raise interest rates to combat inflation. The higher the deficit the higher he has to raise interest rates, and the short term rates push up the long term rates. Or, ino ther words, if your bank has sold your long term rates to low and then the short terms rates go up later you take a bath.

When I was in the bond trading circles from 92-96 everyone talked about the deficit. Every stupid lunch or dinner I went to everyone was talking about Rubin, Ways and Mean, or after 94 Gingrish and how much discipline he will impose. Because they were clients I had to suck it up and listen to it instead of screaming at these guys to get a life and talk about something else. But man they were obsessed with the federal deficit.

But maybe now that has changed and that is why long term rates are low even though the deficit is high.

Another B.S. warning?
 

Not Clintons plural - just Hillary.

What I don't get is why don't the long term bond traders see through this? They have to know the perfect storm can't last forever and if they set their long term rates too low they will be caught with their pants down.

Does anyone know any long term bond traders? After reading this article it really seems to me that they should be freaking out and raising their rates.

Another B.S. warning?
 

happy to stand next to you Club. It's important our side show reasonableness in contrast to the libs. i love Penske, but at times he's prone to hyperbole, and I don't think that helps our cases here.

Just compensation
 

OK legally I may have my head up my derrier. But morally, don't you think the Feds should cover this (in other words the American tax payer should cover this). The Feds should have forseen this type of storm coming and strengthened the levee. I just think if people houses got flooded because of a weak levee they should get compensated.

Did I turn into a bleeding heart liberal and not realize it?

Just my opinion.

Another B.S. warning?
 

2.

Just compensation
 

Yes, you have. We should discourage, not encourge, settlement in dangerous areas. If you pay everyone off, the problem is only bigger the next time.

Their houses got flooded because they're built in a flood plain, or below sea level. The levees just prevented it from happening more often, and sooner. To take fringe's analogy, are you going to tell us next that after an LA earthquake, the feds should pay because they built too much infrastructure there and didn't impose sufficiently strict building codes?

Just compensation
 

You have turned into a bleeding-heart liberal. They built or bought houses in an area for which it was entirely foreseeable that it might someday flood -- possibly they bought/built there because the land was cheaper than higher land. Why should the taxpayers have to pay for the crap decisions of people? I guess you could make the argument that they assumed that the feds would keep the levees in a condition that would withstand a huge hurricane, but I don't think that (a) the feds ever promised that or (b) that it's necessarily even reasonably possible to do so.

I'm kind of surprised at Burger's solution of just banning people from building in the entire area -- this seems like a huge amount of gov't intervention. I would think the market has taken care of it, in a rather brutal way. Also, I'm used to seeing some limited areas left unbuilt for flood management, but not to the extent of depopulating a city.

Of course, I'm not generally opposed to stuff like welfare and subsidized housing for the poor, so I am assuming there is a safety net for people who had made homes there (whether renting or owning) and now have no homes. Burger may be saying, let's just ban building there because then we won't have to pay to get people back on their feet next time this happens.

I would not really be wanting to spend exponentially more amounts of money to have just somewhat of an increase in the ability of new levees to withstand a hurricane of similar force -- it doesn't seem like they come around all the time. And, I think it makes more sense for people to come to their own decision about whether to live in NO, now that it's been brutally pointed out that life there is maybe not entirely stable/safe. Maybe they will want higher wages to be induced to live there, so that they can be better prepared in the event of a flood, whether through having more savings, or through opting to live in housing that is in a less flood-prone area.

Shit, there are people who will not move to CA because of the earthquake risk -- NO seems like it should work the same way.

Just compensation
 

If we're following your policy of discouraging, not encouraging settlement in dangerous areas, will your answer to the hypo be no federal compensation at all in order to encourage migration out of CA into Arizona, Nevada and Utah?

TIA for your response. It'll help us set home prices accordingly.

Just compensation
 

You are in favor of building codes? Christ. My image of you is entirely ruined.