Obama has to use the 14th Amendment.

Obama should invoke the 14th Amendment to the Constitution that states the following: The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.

 First of all it will force the party of “personal responsibility” to pay their debts. Let me remind you that the debt ceiling needs to be raised not to expand government spending in the future as our far right folks think, but to pay for bills that already have been incurred in the past, mostly by the same personally responsible, fiscally conservative party, like paying for wars, Bush’s tax cuts, and interest on the existing debt. (Obamacare has not kicked in yet, just so you know).

 Second, if someone will still question the legality of the move, he or she can take it to court. I can’t wait to see what sort of personal injury or loss of property they will claim to suffer from the event of NON-default. Well, I can imagine PIMCO folks or others who shorted Treasuries counting on default to have a monetary loss, but just picture them in front of US Supreme Court with this!

 Third, I don’t think the Tea Partiers in Congress understand the whole seriousness of the situation. They are looking at the default as if it’s a tool to use against Obama and not something that will hurt them or their constituents in the end. Politicians who engage in political posturing to placate their caucus is one thing, everyone does it, but Tea Party block are true believers – they really do want US to default, all be damned. “That’ll show’em!” – they think. They need to get some education from some wily lawyers who used to run the show in Congress, but who also know what a compromise is. When grandma or some average Joe investor or some contractor doesn’t get paid – who cares! But when Wall Street gets nervous and when Tea Party financial spigots are scratching their heads at a bunch of hillbillies they sent to Congress – that’s a wake-up call. When Wall Street feels like it won’t get paid – they will make sure their message gets through. And that’s where, with all my antipathy towards lawmakers, I would prefer crafty lawyers to uneducated hacks. The hacks that love the Constitution so much they want to amend it. The same hacks that love America so much they want her to default.

 And lastly, Bill Clinton says he would use this amendment “without hesitation” and “let them challenge me in court”. This alone would be enough for me!

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Adults in the room

I always wondered at the ability of some, mostly on the right, to twist the meaning of words. Today the word is seriousness. John Boehner while abandoning the debt ceiling talks last night issued the following statement: “The White House is simply not serious about ending the spending binge that is destroying jobs and endangering our children’s future.”  Of course! Destroying jobs and endangering children. When you’re painted into a corner and ran out of meaningful words to say you resort to “The American people”, “Our childrens future”, “Taxing the job creators” and other platitudes. All that in addition to not returning President’s phone calls! Contrast that with what Obama said last night: The deal is extraordinarily fair, I’m taking heat from my own party for this, I have been left at the altar a couple of times, Can they say yes to anything? Obama is like a superintendent in a crumbling apartment complex, who is figuring out how to fix the plumbing, repair leaking roof, get new washer/dryer while Boehner spends his time spreading rumors that increasing the maintenance fee will hurt those living in the penthouse. He doesn’t tell them, however, that when the roof collapses there will be no penthouse! So who’s serious here?

I’m also a little puzzled by those who see what’s unraveling and take the position of “the pox on both of your houses”. Both of your houses?! Obama, in his attempt to make a deal has moved so far to the right that pissed of his base and even prompted calls from senator Bernie Sanders to “primary” him. That’s leadership! That’s putting country before politics. He knows that this might make him a one-term president, but he’s doing what’s right. And what did Boehner do? He can’t deliver his caucus to do anything, thus to save face, he shows us some theatrics by walking out. I cut him some slack and will not accuse him for genuinely NOT wanting to make a deal, it is possible he really might want to make it, I accuse him for not having a hold on his own people. (Funny, how this used to be a problem on the left, liberals are notorious for being difficult to take marching orders). Why would Obama want to negotiate with the leader who does not lead? It’s like playing poker with the guy who doesn’t have the cash to pay up at the end of the day. Boehner ultimately can not make a deal even if he wants to. Serious people come to the negotiations with the readiness to back up their words with actions. Unserious people just have a lot of things to say and a lot of excuses to give. Like children who get caught stealing a cookie. They’re sending a boy to do a man’s job. Unfortunately that’s what Republican party has become now – a party of capricious little boys, not serious adults.

Obama keeps tax cuts for the rich

First of all let me congratulate those destitute 1% of the population who were scraping by paycheck to paycheck and who can now breathe a sigh of relief. I heard so many frightening stories about how the 3% increase of their tax rate will slow the economic recovery. Now these 3% will sure trickle down to the rest of the population. But enough sarcasm – I’m really happy for them. Maybe now they will finally stop complaining that Obama administration treats them unfairly. From my previous posts you probably know that the abundance of complaints and general thinness of skin (real or assumed) on Wall Street (who else is in the top tax bracket?) is my favorite topic. The amount of wimps in the top bracket is breathtaking. Makes you wonder how is it that they made it to the top?

I think it all comes down to the fact that being viewed as a victim has become fashionable in this country. It’s a foolproof PR strategy. Moreover, it’s convenient – you get to blame a third party (Obama, government, stiff regulations, communists, etc.) for all of your misfortunes.
Obama, unfortunately, got himself in the position where he’s damned if he does and damned if he doesn’t. One part of the country thinks that he’s in bed with Wall Street, the other part of the country is convinced that he’s out to destroy capitalism, and media doesn’t bother to notice the controversy. For their own convenience certain news sources can criticize Obama for having too many Goldman guys in his administration (alluding, of course, that he’s conniving against the working man) and in the same breath accuse him of socialistic tendencies. I fault Obama for not fighting back hard enough against this nonsense. He’s in dire need of some pit bulls and a Fox-like echo chamber with talking heads. If there’s one thing I admire about the Republicans is that they are masters at propaganda. Their mantra that repetition makes it true really works: death panels, Obama’s Kenyan birth, middle class tax increases – all of it stuck.

Now that Obama kept Bush’s tax cuts do you think that he’s going to be thanked by the business community? Fat chance! Investors Show Obama No Respect in Global Poll as Profits Surge As I described above it’s convenient to always be pissed off about something. Investors made money this year, profits surged – but they’re still not happy. If they are not pissed off at Obama they really have no one else. They need him as a human receptacle of all kinds of misdirected anger. Especially now that the Congress is Republican.

To Obama I say – may the force be with you!

Some predictions for the near and not so near future

When you pay premiums for your insurance and if and when the time comes for you to get the benefits, imagine how pissed off you would be if, instead of getting the benefits, you would receive a lecture from your insurance company on the evil of handouts, generously peppered with folksy “American entrepreneurial spirit/pull yourself by your shoelaces” stories. That policyholder is the American unemployed and that insurance company is nowadays Republicans. Nowadays, because Republicans had no problem approving unemployment insurance for those lazy bastards when Bush was in office.
The public, notoriously attentive to details and known for their long attention span, will be able to see through the spin, of course, and reward Obama at the expense of the GOP. But not the way you think. Here’s how. This year, the Republicans will take the House, yes, that is my prediction. They will do so because Obama is in office and things are still pretty bad economically. Of course, when the GOP takes over the House they’ll show us, Commies, how things need to be done! Frankly, I can’t wait. Market loves gridlock in Congress, because this way no harm is coming the Wall Street way (apart from the freshly passed Financial Regulation Bill that has already been priced in). In anticipation of Republican takeover this fall the market will rally (that is my second prediction). For the next 2 years the GOP will demonstrate their problem solving skills with breakthrough and revolutionary ideas of tax cuts and less regulation. We will hear a lot of talking heads and read a lot of editorials about a repeat of 1994 GOP takeover of Congress with no mention of what happened in 1996. Which leads me to believe that Obama actually wants GOP to win this fall, so as to win against them in 2012. It’s a win-win situation for him. In 2 years, even if there’s no gridlock in Congress, the recession will be over through a natural cycle and what would stop him from claiming a well-deserved credit?
Oh, here’s Obama with balls. I’m considering it as one of my new blog avatars.

Poker and Politics

My brain, already quite meager to begin with, is totally melting in this heat for the last few days, forbidding me to deliver you a new portion of my rabid opinion. As of this moment I’m seriously concerned for the life of the prophetic octopus in Germany. I’m afraid it goes well with the beer.

As I sat at the poker table in AC the other day and observed the action, I got reaffirmed in how much poker is like politics and vice versa. For example, there are many ways to win the pot – some of them opportunistic and some long-term strategic. Opportunistic is when you’re in the pot with weak hand and you sense weakness in others as well and you go ahead and steal it. The key here is not to think for too long and just do it. More often than not you will not get called, out of sheer momentum, and that’s all you need. The strategic way is much less fun than the opportunistic and it involves boring stuff like counting the odds and folding too many hands. Democrats have lost the momentum some time ago and, despite occasional opportunities presented by loose-lipped Republicans, they now have to resort to just grinding away at a slow pace. But even here they manage to miss a few pots. For example, the cost of pushing through the extension of unemployment insurance would be roughly $25bn addition to a $14 trillion debt which is much less than half a percent. The cost of NOT pushing this bill will most likely result in Republican takeover of the House and the Senate. To put it in a poker terms, if you already put $1400 in the pot you’d be a fool not to call another $25, even if you have 2-7 offsuit, because if you lose – you lose only $25, but if you win you might win big. Republicans blocked the extension on budget concerns, at least that’s the official line, but I’m positive it has something to do with the upcoming elections and they want people to suffer for some more so that they are ripe for the taking this November. At this point I don’t quite understand why Obama and Democrats don’t talk about it every day, why do they allow Republicans to take the initiative and portray the situation as “killing an ant with a nuke” and to beat themselves in the chest proclaiming newfound concern for the budget. Moreover, the “borrow and spend” was an ok way to finance various conservative causes under Bush, and it was presented as responsible governing vs. the liberals’ “tax and spend” ways.

Another big ominous sign for Democrats from the poker table: At one point I was playing with a bunch of colorful New Jersey union employees at the table, you know, the Teamsters, gold chains and all, talking non-stop about economy and thrashing Obama. Well, they also talked about how long it is until retirement and what to do to squeeze maximum benefits upon retirement, but nonetheless, I’m sure Democrats are not getting votes from these guys this fall. From the Teamsters, for Christ sake! I wasn’t sure they were aware that if it was up to Republicans they would see none of the benefits and would be paid $7 an hour, but who cares about the facts these days. What are Democrats smoking? Where’s the PR, where’s the offensive, where’s Chicago-style shakedown? Or do they want to lose this November so that they could pull “a Clinton” circa 1996 in 2012?

Anyway, the Teamsters were entertaining in many ways, especially in the way they played. One of them declared that he “wanted to be closer to the fish” before changing seats to a seat next to mine. I just joined the table and I don’t think I played a single hand yet, but I went out of my way to look like a freshly cut piece of toro. He proceeded to lose all his stack, not to me unfortunately. But this episode made me come up with an amendment to an old poker adage “If you don’t see a fish at the table, then you are one”: The human mind works in such a way that it’ll always find a fish at the table.

In Defense of Obama

I had lunch the other day with an old colleague of mine, and we talked politics among other things. At one point, many years ago as we were working for the same company, we had very similar, far left political views. Back then he introduced me to Noam Chomsky and Howard Zinn. Now he occasionally reads my blog and he told me that I became too right-wing. Almost – he paused looking for appropriate analogy – like David Brooks! (David Brooks is considered a conservative by New York Times standards). We laughed at this description of me, but then I thought, perhaps, there’s some truth to that. My colleague is disappointed with Obama because the troops are still in Iraq and Afghanistan. Frankly, I am disappointed at the Left for being disappointed with Obama. Disappointed liberals, I said, do not realize that this is the best they are going to get, this is the best person in a generation to represent their interests but they allow themselves to be whimsical rather than supportive. Do they honestly believe that an idealist like, say, Ralph Nader could ever be elected to represent them? I proceeded to explain to him why I think left wing idealism and rigidity is killing the movement and why it is necessary to have a practical approach to complex issues.

I know Obama understands it. He displays an enviable coolness of character, this ability to maintain composure and focus under the most severe pressure. I like that he does not have the propensity to rush to judgment and he doesn’t give us the presidential theatrics that the public demands, like public displays of emotion. He concentrates on task at hand while both Left and Right, like spoiled children, foaming at the mouth, demand that he does the impossible. How much more demanding we are of Obama is unbelievable. The bar that was set so low for Bush is raised to inhuman levels for Obama. Bush could kill a puppy on national TV and be applauded for doing it, Obama can don a batman costume, dive into the Gulf of Mexico and put his thumb into the leak and we’ll complain that he’s using the wrong thumb! I’m happy to see, however, that it bothers me more than it bothers him. I guess that over the course of his life he got used to idea that he must study more, work harder, be smarter and not complain about a thing just to be considered on par with the rest. That’s what makes him a perfect leader in times like these. I’m not saying he’s perfect, I’m saying that he’s the best we’ve got to steer the country through the crisis. He has the qualities to do that. Obama, see my previous post, knows the ways of the force.

As many of you know, and as obvious from the above I criticize both the liberals and conservatives. Because both have fringes and fringes are emotional. The more you get to the political center the less emotional and more practical you become. The truth is in the center, the Golden Mean, the Zen or whatever you want to call it. You can tell whether you’re in the center when if faced with a problem you say “What can be done about it now?” as opposed to “The world is coming to an end!” or “It’s so-and-so’s fault”. The Republicans scream that we’re all going to die, the Democrats screams “It’s Bush’s fault” and in the meantime Obama is trying to do something about it. The way things are going right now, however, being a centrist would mean that in addition to piloting a ship during the storm, Obama would have to step into the passenger cabin from time to time and to tell everyone to “Calm the Fuck Down!” Somewhat like this:

Goldman is Goldman, but Obama is Obama

I have a friend who, as we talked about the upcoming season of Bolshoi ballet at the Met a few years ago, said: “Kirov is Kirov but Bolshoi is Bolshoi!” The same can be applied to Goldman and Obama. Goldman maybe good, Goldman maybe the best there is. But for every wise ass out there there’s a left-hand screw. Obama might as well turn out to be Goldman’s screw. But not for the reasons you think. Allow me to elaborate.
Goldman was the biggest Obama donor when he was running for president. This fact is being brought up very often in the last few days. Now picture the typical reaction of a typical politician when such fact becomes known. First he denies it, then when that doesn’t work he tries to give money back, after which he proceeds to do the donor’s bidding anyway. What Obama did is breathtaking (in a good sense). He
a) Said, yeah, I got the money from Goldman;
b) And no, I’m not giving it back;
c) And I’m going after Goldman regardless. And on top of that I’m asking them to join me in my fight.
What balls! How refreshing! It’s becoming more and more evident to me that he and his team not only know what they’re doing, they have read and memorized all the right books. Democrats, who have gotten accustomed to take it on the chin, have learned not only to attack but mastered such a subtle mockery that I’m sure puts Lloyd Blankfein in silent rage stemming from sudden feeling of helplessness and lack of control over the situation – a new set of emotions for a man like him.
My suspicions about Obama’s team were confirmed the other day by another friend of mine, no stranger to strategic moves himself – a deft poker player, a champion bridge player and shrewd businessman. Between spits and curses (he’s no fan of Obama), he admitted that Sun Tzu and Nicholo M are the table books for Obama’s team. They play by the book, he said, and that’s what will bring them down, he added. I exercised that possibility in my head, but then I thought that, at a very minimum, they must have an opponent who plays by the book. So far the opposition plays checkers to Obama’s Grandmaster level chess. Honestly, I’d be delighted to see Republicans’ strategy expanding from willfully pretending not to understand what’s written in the bill. But it seems now that it’s the only thing that comes to their mind.