Again, I Must Refer You to Hitchens

Castro + Religion = 50 years of power.

The Best Ten Movies To See in 2009

The 10 movies I will be sure to see next year:

Watchmen
Inglorious Bastards
Shutter Island
The Wrestler
The Curious Case of Benjamin Button
On the Road
Nine
A Serious Man
Nottingham
Margaret

The Next Sticky Issue

A shortage of sperm donors in Britain has led to long waits at clinics and even caused some clinics to stop offering donor sperm, fertility specialists are reporting, and they are calling for nationwide changes to increase the supply...Sperm were also being imported, mostly from Scandinavia.

More blonds who speak English? Yes!

Bye Bye Ted

So the convicted felon is out and a Democrat (gasp!) will now sit in the spot that had been occupied by Stevens for 36 years. This has another positive effect: Sarah Palin will not be able to entertain plans of a Senate seat for 6 more years. Get the full story here.

Bailing out Detroit

I'm as terrified as the next person about what would happen were GM to collapse; the domino effect this would have on American industry and labor markets is unpleasant to fathom. But if America decides yet again to use taxpayer money to bail out a company suffering because of its own choices, it should be carried out according to Paul Ingrassia's WSJ proposal:

Let's assume that the powers in Washington -- the Bush team now, the Obama team soon -- deem GM too big to let fail. If so, it's also too big to be entrusted to the same people who have led it to its current, perilous state, and who are too tied to the past to create a different future. In return for any direct government aid, the board and the management should go. Shareholders should lose their paltry remaining equity. And a government-appointed receiver -- someone hard-nosed and nonpolitical -- should have broad power to revamp G.M. with a viable business plan and return it to a private operation as soon as possible. That will mean tearing up existing contracts with unions, dealers and suppliers, closing some operations and selling others, and downsizing the company. After all that, the company can float new shares, with taxpayers getting some of the benefits. The same basic rules should apply to Ford and Chrysler.

This analysis is on the money. On top of these conditions, it might be wise to stipulate that any automobile company getting taxpayer money must put forth a viable plan to modify the engines of all its vehicles to hybrid-electric engines with flex-fuel capacity, so that their fleet can also run on cellulosic ethanol.

Thomas Friedman proposes a final condition in today's NY Times. "Someone ought to call Steve Jobs," he writes, "and ask him if he'd like to do national service and run a car company for a year." It wouldn't take him long to "come up with the G.M. iCar."

Happy Birthday!

On Nov. 10, the following people were born:

Martin Luther
Paul Kuczynski
Winston Churchill
Saxby Chambliss
Jack Clark
Sinbad
Neil Gaiman
Sammy Sosa
Brittany Murphy
Christopher Eby

The First Casualty of the Financial Crisis

It's a hard knock life living in Iceland...

No More Palin, No More Polls

The election's over, and you're bored. You're not really elated that your guy won or dismayed that he got crushed—really, you just wish you knew what to do with yourself. Over the last few months, you've spent hours each day poring over polls and reading every pundit. Now all that is done, the Web seems so ... empty.

Not sure how to waste time on the net anymore now that America has proven that its not entirely senseless? Find out how at Slate.com.

The Case for Obama: A Calculated Risk

The Economist published the following endorsement of Senator Barack Obama for President:

The Democratic candidate has clearly shown that he offers the better chance of restoring America’s self-confidence. But we acknowledge it is a gamble. Given Mr Obama’s inexperience, the lack of clarity about some of his beliefs and the prospect of a stridently Democratic Congress, voting for him is a risk. Yet it is one America should take, given the steep road ahead.

Why the Federal Stimulus?

Martin Feldstein and Paul Krugman have teamed up, calling for increased government programs and more policy proposals to help avert a new nadir in the recent economic crisis. The former’s recent column in the Washington Post claims:

With the Fed’s benchmark interest rate down to 1 percent, there is no scope for an easier monetary policy to stop the downward spiral in aggregate demand. Another round of one-time tax rebates won’t do the job. The rebates that Congress enacted this spring failed to stimulate consumer spending: More than 80% of tax rebate dollars were saved or used to pay down existing debt. The only way to prevent a deepening recession will be a temporary program of increased government spending.

As much as Feldstein thinks that tax rebates did little to stimulate consumer spending, he seems to be in a camp of his own. Parker’s findings indicate that household spending increased when consumers received their stimulus payments. Parker’s report goes on to say:

With the Economic Stimulus Act of 2008, policymakers tried to increase disposable income temporarily through tax rebates in the hopes that households would increase or maintain their spending levels and so end or at least mitigate the severity of a U.S. economic slowdown. We find some success: the stimulus payments are initially being spent at significant times.

Feldstein, it seems, does have one other bedfellow. Paul Krugman’s most recent “work” reads:

Sooner or later, then, consumers were going to have to pull in their belts. But the timing of the new sobriety is deeply unfortunate. For consumers are cutting back just as the U.S. economy has fallen into a liquidity trap—a situation in which the Federal Reserve has lost its grip on the economy…In particular, the financial crisis has made Fed policy largely irrelevant for much of the private sector: The Fed has been steadily cutting away, yet mortgage rates and the interest rates many businesses pay are higher than they were earlier this year. The capitulation of the American consumer, then, is coming at a particularly bad time. But it’s no use whining. What we need is a policy response.

Although Krugman and Feldstein may disagree with me, consumers should cut their spending now. Everyone knows that consumers have been living beyond their means. If, hypothetically, consumers decide to maintain their spending (whether through a cut in sales tax or a Krugman-esque fiscal stimulus), but everyone knows consumer spending will decline in 18 months. While the so-called “liquidity trap” will be finished by then, investment commitments will be mediocre in the meantime, since people will be waiting for the economy to process change. Perhaps we need to spend less now and get the adjustment over with faster, even though that will be painful. Or say we don’t know when the spending decline will come—markets dislike uncertainty most of all.

I view the goal as expediting necessary sectoral adjustments and minimizing unnecessary (i.e., temporary) ones. Any of Krugman’s “stimulus” funds should go to preserving expenditure patterns of state and local governments. This ensures that the money is spent, if that is indeed the goal. Greg Mankiw offers a related solution. Indeed, the columns of Krugman and Feldstein are stark commentaries on how much of a fiscal “quick-fix” society we have become.