Posted 3:22 PM by Robert

As Kentucky and Mississippi Go, So Goes Louisiana?

The election is not until November 15, but it looks that way now:

Republican Bobby Jindal, leading Democrat Kathleen Blanco by five points, was nearing the 50 percent majority with likely voters, according to a Daily Advertiser/Louisiana Gannett poll taken this week. Forty-eight percent favored Jindal, and 43 percent Blanco.

That poll has a margin of error of 4 percentage points, so it is hardly dispositive of current sentiment. But other recent polls seem to be indicating the same thing: here (Jindal leads Blanco by seven points) and here (Jindal leads Blanco by four points), for example.

The Lafayette Daily Advertiser reports:

University of Louisiana at Monroe political scientist Pearson Cross said Blanco needs a greater percentage of white votes.

“Right now, Kathleen Blanco is not at the magic number that will get a Democrat elected,” Cross said. “She is at 29 percent, but needs to be at 32 to 34 of the white vote, and a very strong black turnout that votes for her.”

“Louisiana is getting more and more like the rest of the country,” Cross said. “I cannot detect in these poll numbers any effect of Jindal’s ethnicity, but you can see there may be some anti-woman backlash among black males. Black males are significantly stronger in their support for Jindal than black females.”

The Republican has already won considerable African American support, including from the Mayor of New Orleans and the state's North-Central Black Caucus and perhaps 17% of the African-American votes.

That 17% number should send chills down the spine of every Democratic office holder. It is the same number that demolished Gray Davis and the Democrats in California, as I noted in the aftermath of the recent California recall election:

While 17% African-American support won't by itself get anyone elected, that level of support from such voters for a Republican should be alarming to Democrats - who normally bank on African Americans favoring Democrats by a much wider margin. Worse for Democrats: that Mr. Bustamante - the only Democrat in the field - received only 65% of the African American vote should be seen as a major Democratic disaster. ... Democrats such as Bill Clinton and Al Gore counted on receiving more than 90% of the African American vote. For example, if a Republican presidential candidate were to carry 17% of the African American vote - or a Democrat were to carry as little as 65% of that vote - the consequence would almost certainly be a huge Republican win.

All of which makes it even stranger that the Democratic Party routinely treats its African American constituency with such an amazing lack of respect.

MORE: A terrific report from RealClear.

Posted 5:54 PM by Robert

Such Setbacks

The Washington Post reports with a perspective common among the media:

The legal attack against a new ban on certain late-term abortions rapidly escalated Thursday as federal judges in New York and California blocked the law, delivering a major setback to President Bush only a day after he signed the measure.

Now, that might be correct. But Tom Daschle voted for the ban on late-term abortions. He did that because he is unusually vulnerable in next year's Senate election in South Dakota, a state that is quite conservative on abortion matters. His disapproval rating in South Dakota polls is already 36% - and the million dollars he has already spent on television advertising is reported to have been completely ineffective in changing that number.

The "major setbacks" to the new abortion law were imposed by federal judges with views exactly like those the Senate Democrats are insisting be held by all federal judges. The number of blockaded presidential appointments to the judiciary is growing to increasingly massive numbers.

And Tom Daschle, of course, is in charge of seeing that the blockades are effective.

The abortion bill's obstruction by federal judges is likely to become a high visibility issue. How comfortable will Mr. Daschle be in his South Dakota campaign defending blockades?

Many commenters believe the Democratic filibuster of Charles Pickering's nomination to the Fifth Circuit may have seriously damaged the Democrat's chances of retaining the Mississippi's governorship. As the Los Angeles Times put it:

Senate Republican leaders scheduled the Pickering vote to occur five days before the closely fought Mississippi gubernatorial election. That will give Republicans a well-timed opportunity to portray Democrats in Washington as out of step with a region where many Democratic incumbents are struggling to hold onto office.

The current actions of federal courts obstructing the partial birth abortion law could make Mr. Daschle very uncomfortable indeed as he campaigns for re-election next year.

Posted 10:06 AM by Robert

Brad DeLong: Deny! Deny! Deny! But Keep It Bloated And Mostly Indirect!

Compare

and

contrast.

Dear me. Employment numbers way up - retroactively. Other economists are saying things like "Employment has turned the corner earlier than we anticipated. … The improvement in employment suggests that consumer spending should receive a boost towards the end of Q4." [Jayanth Nazareth, economist, JP Morgan Chase Bank] And Good Professor DeLong was surprised by the employment news, too, since he wrote only hours ago:

The always-wise John Berry of the Washington Post peers into his crystal ball and tries to gauge the future of the economy. [Mr. Berry predicts with complete confidence and no qualifiers whatsoever that] tomorrow the [Labor Department] will release a report covering employment and unemployment in October. Surveys of analysts show an expectation that the number of payroll jobs rose 60,000 last month, about the same as in September, with little or no change in the 6.1 percent jobless rate...

It turns out that the always-wise John Berry's crystal ball has a severe astigmatism! He and it and the Good Professor all missed the great majority of the extra 441,000 jobs that the Labor Department found. Well, now, that could happen to anyone.

But isn't that all worth a bit of re-revising of the Good Professor's personal estimate of the fourth quarter GDP growth rate - an estimate that has never been disclosed. Hey, he said it was "personal!"

Today's waffling DeLong post appears entitled: Todays Good Employment News, but the article's title in the Good Professor's index is Todays "Good" Employment News.

Showing a few cards as to our state of mind, are we, Professor?

UPDATE: Perhaps because he has been outed, the article's title has been changed to conform to the Good Professor's index and inner longings. Good. So good. His is a vanity site - where reality need not intrude. Now it's time for the Good Professor to hop off and think about movies!

MORE: Not that there's anything wrong with writing about movies! It's the Good Professor's sudden and all-too-obvious urgent need find some peace of mind by radically changing the subject that's amusing.

Posted 11:52 PM by Robert

Productivity

The media is abuzz over the just announced rise in worker productivity. Non-farm business productivity climbed at an 8.1 percent annual rate in the third quarter, the biggest surge since the first quarter of 2002.

But, as the Wall Street Journal reports, that productivity rise is even more startling in specific sectors:

It was even higher among manufacturers, and it rose a whopping 14.7% for those who make durable goods, which were a big part of the consumer purchases that drove up growth in the third quarter.

Posted 3:56 PM by Robert

Some Polls

A slightly surprisingly large fuss was made over the recent Marist College Poll covering Oct. 27-29, 2003, that indicated 44% of those polled "definitely" plan to vote against George Bush for reelection as president in 2004 (among other things).

The fuss was slightly surprising because much of it came after the announcement made subsequent to the polling period that the third quarter gross domestic product annual growth rate had come in at 7.2% (subject to possible revision). Obviously, that "definitely" is subject to variations in the economic peformance.

Well, a new Zogby Poll for November 3-5 asked the question:

"If the election for president were held today, for whom would you vote: the Republican George W. Bush or the Democratic candidate?"

The results were as follows:

......................George
......................W. Bush............................Democrat..................................Other....................................Not Sure
...........................%.....................................%.............................................%...........................................%
11/3-5/03.........41.....................................41.............................................2.............................................16
10/15-18/03.....43.....................................45.............................................1.............................................12
9/22-24/03.......41.....................................45.............................................3.............................................12


Since the margin of error for this poll (MoE) is ± 3.2, all of the variation from September could be flukish. But the apparent four-percentage point drop in Democratic support in such a short period is suggestive. It's also consistent with another Zogby result from the same November 3-5 period:

"Do you think President Bush deserves to be reelected or do you think it is time for someone new?"


.................................Deserves Reelection....................................Someone New....................................Not Sure
.............................................%..............................................................%....................................................%
11/3-5/03............................43..............................................................49....................................................8
10/15-18/03........................42..............................................................50....................................................8
9/22-24/03..........................43..............................................................49....................................................8
9/3-5/03..............................40..............................................................52....................................................8

Again, the MoE here could absorb many indicated variations. But the shift from 40-52% against the President in 9/3-5/03 to 43-49% against him for 11/3-5/03 is significant: he has halved the gap, cutting it by 6 points.

Of course, as some commenters have pointed out, the jobs numbers may have more political effect than the GDP numbers.

Which suggests that the next few rounds of polls - the ones that will reflect the most recent employment numbers - should be even more interesting.

Although Democrats may want to take a Prozac before reading up next time.

Posted 12:08 PM by Robert

The Insolvency of Herr Doktorprofessor Paul Von Krugman II

Herr Doktorprofessor Paul Von Krugman likes to talk BIG. And he likes to talk IMPORTANT. He likes to live LARGE.

And hardly anything is BIGGER or more IMPORTANT or sounds LARGER for an economist than NATIONAL INSOLVENCY. It's not surprising that Herr Doktorprofessor talks about National Insolvency a lot - not just about the United States, but other countries, too. A few insolvency bagatelles, by no means an exhaustive collection: here and here and here and here and here and here and here and here and here and here and here and here here and here and here.

But, oddly, in his synopsis of his Macroeconomic models and Currency Models examining current crises, in which national "solvency" considerations seem to play a central role, there is no actual definition of national "solvency."

So what the heck does Herr Doktorprofessor mean when he references national "solvency?" The answer to this question seems not to be as straightforward as it might seem - and Herr Doktorprofessor implicitly suggests it to be. He comes pretty close to defining what he means in his interview with Tim Russert, where Herr Doktorprofessor eloquently explained:

The really bad thing about deficits, if they're big enough and go on long enough, is that governments, like people, can go bankrupt, all right? There can come a point when investors say, you know, 'I don't want your bonds, because I don't think you're going to be able to repay them,' and that happens. That has--that's happened to Argentina recently. It's happened to--Brazil's been skirting of--off the edge so they pulled it back a bit. It's--so the worst thing is just plain insolvency, you know, just plain--you--people--you can't--you can't run the government. You've got--people won't buy your debt. We're actually on course to having that happen. Ha--you know, if you--i--unless there's either a drastic cut in social programs or a major tax increase, we are eventually going to find ourselves in that position. That sounds u--incredible. Can't happen to America, but actually, that's the way the numbers look. Now that's a little ways off. Meanwhile, the problem is also that the government is borrowing a lot of money that could otherwise be financing real investment, so we're--you know, we're talking about essentially draining off funds that might otherwise be there to--to build factories, to improve technology, and--and to build housing, buildings, whatever, and wi--big enough now. Deficits at the rate we're now running are enough to probably knock a half point off our growth rate in the long run. But I--I--actually I'm--I'm fundamentally concerned just about solvency. I just think that we're witnessing the banana republicization of--of the United States, and it's pretty scary.

Now regardless of whether one agrees with what he said here, it seems pretty clear that Herr Doktorprofessor maintains that there is now a binary choice for the United States: (1) a drastic cut in social programs or a major tax increase soon OR (2) national insolvency in the fairly near future.

But is that really what he means at all? Elsewhere, Herr Doktorprofessor seems to suggest that his posited coming "fiscal crisis" (which seems to be more or less the same thing as his posited coming "solvency crisis") will itself force the US into making its binary choice, which one might think from the above quote must be made now (or soon):

The astonishing political success of the antitax crusade has, more or less deliberately, set the United States up for a fiscal crisis. How we respond to that crisis will determine what kind of country we become. If Grover Norquist is right -- and he has been right about a lot -- the coming crisis will allow conservatives to move the nation a long way back toward the kind of limited government we had before Franklin Roosevelt. Lack of revenue, he says, will make it possible for conservative politicians -- in the name of fiscal necessity -- to dismantle immensely popular government programs that would otherwise have been untouchable.

Normally one does not use the term "insolvent" to refer to a person who could pay his or her debts as they come due provided personal expenditures within the debtor's control were cut, or who could raise additional revenue outside of a bankruptcy reorganization. For example, a person who can service personal debts by, say, deferring a home addition or firing a housekeeper or raising the rent on some property owned by the debtor, is not "insolvent" for bankruptcy law purposes - an analogy Herr Doktorprofessor employs when he reasons "governments, like people, can go bankrupt, all right?" [The alternative, "legal," definition of "insolvency - "debtor's gross assets are less than debtor's gross liabilities" - doesn't seem apposite.]

But governments raise revenue by raising taxes. Herr Doktorprofessor seems to be positing a situation soon upon us in which the federal government will not be able to raise revenue by raising taxes.

Is Herr Doktorprofessor shacking up with Arthur Laffer? Do Herr Doktorprofessor's repeated rants about a looming "fiscal crisis" or "solvency crisis" implicitly incorporate a crucial dependency on the Laffer Curve?

But Herr Doktorprofessor's repeated (to say the least) attempts to use national "solvency" considerations have even stranger components than an implicit incorporation of the Laffer Curve. Despite the, shall we say, sprawling definition of national "insolvency" he provided to Mr. Russert, federal bondholders ultimately care about only one thing from a "solvency" perspective: Is the federal government actually going to make all payments on its bonds when those payments are due? Bondholders are, in that capacity, rather narrow minded - and except to the extent it affects the likelihood that the government will pay, bondholders don't give a hoot about the worst thing ... just plain--you--people--you can't--you can't run the government.

So, suppose the federal government reaches a point - the Laffer Point - where it can't raise revenue by raising taxes. What will the bond markets then demand? The bond markets will then demand a federal government that is willing to cut lots and lots of federal expenditures.

Now, another aspect of Herr Doktorprofessor's thinking is that Republicans are running up big deficits because of what they can do when that fiscal crisis comes: Lack of revenue, [Norquist] says, will make it possible for conservative politicians -- in the name of fiscal necessity -- to dismantle immensely popular government programs that would otherwise have been untouchable. If that is true, and such reductions are not possible for liberal and/or Democratic politicians to make, then the bond markets will demand that only conservative politicians be elected to high office. So if all of what Herr Doktorprofessor predicts (or, in the case of Mr. Norquist's riff, alludes to) happens, the result doesn't seem exactly to be a looming problem for conservative politicians (as he conceives them).

As an aside, Alan Greenspan seems to embrace a Laffer curve approach to the issue:

While Democrats have blamed much of the current budget woes on Bush's tax cuts, Greenspan cautioned against relying on increased taxes to reduce the deficit.

"Tax increases of sufficient dimension to deal with our looming fiscal problems arguably pose significant risks to economic growth and the revenue base," he said.

Greenspan said it was difficult to estimate the exact magnitude of these risks but that they were of enough concern to warrant reducing the budget deficit "primarily, if not wholly, from outlay restraint."

But, then, he would. After all, way back in July Herr Doktorprofessor declared Mr. Greenspan is a hack and that the Fed chief had already lost his last chance to save his reputation — and the country's solvency.

Posted 10:23 AM by Robert

I Think He Inhales

Fox News reports:

Democratic presidential candidate Wesley Clark is renewing his charge that soon after the 9/11 atrocities, the Bush administration considered going after as many as seven governments in the Middle East and Africa.

Clark says the preliminary plan -- to overturn the governments in Iraq, Syria, Lebanon, Libya, Iran, Somalia and Sudan -- was outlined in a Pentagon memo. Though Clark, according to the Arkansas Democrat Gazette, admits he has never actually seen the memo, he insists -- "You only have to listen to the gossip around Washington and to hear what the neoconservatives are saying and you will get the flavor of this."

Actually, I think you will get the flavor of General Clark's thoughts best by using the kind of really high quality bongs the glassblowers on Hyperion Avenue in Silverlake turn out - not that I've ever tried one, of course. Yet, despite his willingness to make free-form public accusations about invasion plans he says were contained in a memo he hasn't seen, General Clark, strikingly denies smoking dope!

Come, come, General Clark. Not even a little puff to settle the nerves before you talk to those nasty reporters about military matters? It's nothing to be ashamed of. Lots of people free associate and get a little paranoid when they toke up.

Who knows, maybe this will make the General more electable.

Link thanks to Henry Hanks.

Posted 9:31 AM by Robert

Another By Election

In other local elections, Republican Orlando Sanchez and Democratic former Deputy Energy Secretary Bill White headed for a runoff in Houston, the nation's fourth-largest city, after neither captured a majority of votes in a crowded field.

The Republican is the one with the Hispanic name.

Posted 7:05 PM by Robert

Mississippi Governor's Race

Report:

Republican Rep. Ernie Fletcher took the Kentucky governor's seat, after Democrats held that office for 32 years.

Republican Haley Barbour has opened a substantial lead over Democratic Gov. Ronnie Musgrove in the race for the Mississippi governorship.

Mississippi results.

UPDATE: Haley Barbour unseated Mississippi Democratic Gov. Ronnie Musgrove.

More:

Contrary to expectations of some media observors, the Mississippi result was not close. Barbour - who is closely identified with the national Republican Party and its former Chair - took the election by a margin of 8%.

These two elections also suggest that the Democrats' recent southern "boomlet" has seriously deflated, as the AP reports:

With 95 percent of precincts reporting, Barbour got 53 percent, or 449,041 votes, to Musgrove's 45 percent, or 384,693 votes. With 100 percent of precincts reporting in Kentucky, Fletcher, a three-term congressman, defeated Chandler, polling 55 percent, or 593,489 votes, to the Democrat's 45 percent, or 484,931 votes.

Democrats saw a few bright spots. Philadelphia's Democratic Mayor John Street handily defeated Republican businessman Sam Katz, 59 percent to 41 percent. And Democrats took control of the New Jersey Legislature, breaking a 20-20 tie in the state Senate and defeating the GOP's top Senate leader.

But in the Kentucky and Mississippi races, campaigns tried out strategies that could play out in next year's presidential race. And Republicans were already crowing.

"The Democrat strategy was negative attacks and tying Ernie Fletcher to President Bush and making this race a referendum on the president's economic policies," Republican National Chairman Ed Gillespie said. "The Democrats had their referendum and got their answer."

Mississippi Democrats criticized Barbour for his connections and years spent in Washington as Bush, Vice President Dick Cheney and other top GOP officials came to campaign for him - and as Musgrove distanced himself from national Democrats.

In Kentucky, party activists argued that a vote for Chandler would tell the White House its economic policy is a failure.

UPDATE: These elections were not so long ago considered by the New York Times to be highly significant indicators of the national trend ... but all of a sudden they became irrelevant details.

Posted 4:16 PM by Robert

Donald Luskin And Atrios Put It To Bed

Thank God that's over.

Posted 10:46 PM by Robert

The Insolvency of Herr Doktorprofessor Paul Von Krugman

Just weeks ago, Paul Krugman breathlessly warned:

With startling speed, we've blown right through the usual concerns about budget deficits — about their effects on interest rates and economic growth — and into a range where the very solvency of the federal government is at stake[!!!!!!!] (Exclamation points - no doubt deleted by overly conservative Times editors - are here imputed and restored to reflect properly the tone and sense of Herr Doktorprofessor's warning!)

Yes, that all sounds very immediate. We've blown right through the usual concerns about budget deficits - Herr Doktorprofessor huffs - and looming federal government insolvency is now as immediate as the dire wolf at the door! Argentina, here we come!

But what about the Damocles column that had appeared only a few days before? Despite its flashy allusion to the Sword of Damocles and Herr Doktorprofessor's de facto willfull misapplication of the Damocles index for political effect, that column actually backed off on the immediacy issue:

The crisis won't come immediately. For a few years, America will still be able to borrow freely, simply because lenders assume that things will somehow work out.

Today we are further comforted by Herr Doktorprofessor with the assurance that the federal government is in no immediate danger of running out of money. In fact, the entire federal solvency issue - that onrushing Argentina-like future - is pushed off into some remote future, a mere figment of Stein's law - itself a bogus, essentially humorous, quip:

Academic economists often cite Stein's Law, a principle enunciated by the late Herbert Stein, chairman of the Council of Economic Advisers during the Nixon administration. The law comes with various wordings; my favorite is: "Things that can't go on forever, don't." Believe it or not, that's a useful reminder. .... The prime example I have hammered on in this column is, of course, the federal budget.

Whether it's a useful reminder, of course, depends on who you are and how much you need "reminding." Herr Doktorprofessor suggests that its the Bush Administration who need the reminding. No surprise there.

However, it's Herr Doktorprofessor who requires the reminding. He requires reminding that it was variant (precursor?) of this "Stein's law" that provokes Keynes' famous quip: "In the long run, we'll all be dead." That quip didn't put an end to the objection it opposed, but Keynes did correctly point out that serious economic arguments need to be more than mere objections that particular government policy cannot go on "in the long run." Herr Doktorprofessor also requires reminding that his deficit jeremiads have been wildly overblown and protracted. He requires reminding that he has been predicting the collapse of the celestial dome for so long that that it's increasingly hard to look at that strange little photo of him that the Times runs and not imagine his growing resemblance to Chicken Little.

But his still-overheated rhetoric should not obscure the erratic, inconsistent but still real trend. He is backing down. The sky, Herr Doktorprofessor now says, will not fall today, as he asserted so recently. It will not necessarilly fall even in a few years. We are now told that the sky will now fall at some point in the future determined only by Stein's Law.

One is reminded of the question asked by the Professor of Spanish of the Professor of Gaelic: "Does Gaelic have any word that captures the meaning of the Spanish word "manana?" To which the Professor of Gaelic responds: "Yes, .. almost ... but not one with the same sense of urgency."

What's happening?

More...

Posted 7:00 AM by Robert

ABC News and Washington Post Polls

More reasons why Hillary Clinton will not run.

Oct. 26-29, 2003.

N=1,207 adults nationwide. MoE ± 3. Fieldwork by TNS Intersearch.

"Do you approve or disapprove of the way George W. Bush is handling his job as president?"

...................................Approve.............Disapprove..........................Don't Know
........................................%............................%.....................................%
10/26-29/03...............56.....................42........................................2
10/9-13/03.....................53.......................42.......................................5
9/30/03..........................54......................44.......................................2
9/10-13/03.....................58......................40.......................................2
9/4-7/03.........................56......................41.......................................4

Posted 6:43 AM by Robert

Bob Graham Day

Notoriously boring (but popular in Florida) Democratic Senator and erstwhile Presidential contender Bob Graham is to announce today whether he will run again for his Senate position. The Miami Herald reports:

The 66-year-old lawmaker, who seems to have made a full recovery from major heart surgery in January, was expected to announce today whether he plans to run in one more campaign or retire from a political career that began 37 years ago when he ran for the Florida Legislature.

Seems to have made a full recovery from major heart surgery in January? This is an odd place for the Herald to be dropping drolleries. With all respect to the Senator, nobody I have ever met or known has mades a "full recovery" from major heart surgery in a year - especially not a 66-year old. Some people make a recovery suffcient to permit them to live a reasonably active life - and even to resume activities that are in some respects strenuous.

But a "full recovery?"

UPDATE: He will retire.