Wait, Wait, Don't Tell Me

Actually, I have one more economics-themed post that I wanted to include on the last one about inverted yield curves, but just didn't seem to fit there. This might actually have less to do with economics than it does politics. You decide. But I promise: discussions of which obscure old movies I've been watching from NetFlix are coming soon to this space. Get up for it!

At this point, I wanted to bring up quotes from the op-ed piece President Barack Obama penned for the Washington Post on Thursday. The full article is here (free registration may be required). Obama, naturally, was defending his administration's "Stimulus Package", which people have critiqued as nothing more than a pork-laden spending bill. Obama sounded a clarion call for action, trying to get some amount of bipartisan support from the GOP side of Congress, but here is what he said:

By now, it's clear to everyone that we have inherited an economic crisis as deep and dire as any since the days of the Great Depression. Millions of jobs that Americans relied on just a year ago are gone; millions more of the nest eggs families worked so hard to build have vanished. People everywhere are worried about what tomorrow will bring.

What Americans expect from Washington is action that matches the urgency they feel in their daily lives -- action that's swift, bold and wise enough for us to climb out of this crisis.

Because each day we wait to begin the work of turning our economy around, more people lose their jobs, their savings and their homes. And if nothing is done, this recession might linger for years. Our economy will lose 5 million more jobs. Unemployment will approach double digits. Our nation will sink deeper into a crisis that, at some point, we may not be able to reverse.

Now, I don't want to get too historical on you, but I fear Obama could slide down the slippery slope of sounding too much like Jimmy Carter did in the late '70s.

At this point, I would love to link to a YouTube clip showing the scene from an early episode of The Simpsons, when the townsfolk of Springfield were expecting the unveiling of a statue dedicated to Abraham Lincoln. Instead, when the drape was lifted, the statue was of Jimmy Carter (with the tagline "Malaise Forever" -- classic!), which of course created a town riot. Sadly, that clip doesn't exist on YouTube, but I can provide the actual Carter "Crisis of Confidence" speech from 15 July 1979, archived by the University of Virginia. Side note: who knew that when Bill Clinton used the line "I feel your pain," he was practically quoting Carter?



Economic recessions have everything to do with crises of confidence, of course. If consumers have no faith their jobs are secure, their buying patterns change radically. That is one reason why Hyundai's offer to buy back a new car purchased this year if the buyer loses his or her job is so revolutionary. As almost every other car manufacturer saw huge hits on new car sales, Hyundai's sales actually increased 14%. Consumer confidence levels are so critical to the economy, a dedicated organization exists to track them.

Consumer confidence was one factor why the economic crisis described in Tom Clancy's 1994 novel Debt of Honor was so realistic. Clancy understood that for a foreign entity to wreak havoc on the U.S. economy, all they had to do is sow distrust and fear of our economic institutions (like the financial firms on Wall Street) among the American people. The resulting crisis of confidence brought the American economy low, setting up the rest of the novel. Sorry, I don't want to play spoiler for anyone who has not read it yet.

FDR understood how important consumer confidence was during his first Inaugural address, in 1933, when he famously declared, "...the only thing we have to fear is fear itself." The U.S. was already in the midst of the Great Depression, and only by dispelling the negative cloud of uncertainty and fear could FDR lead the country towards economic recovery.

Getting back to Obama and Carter, President Obama will get his stimulus package approved eventually. There was word on the news today that Congress either already approved or appears ready to compromise on a reduced spending bill, one that totals a mere $780B price tag to future generations.

I just think that if Obama wants to help the U.S. recover from this recession in a timely manner, he will skip the doom and gloom speechifying. For heaven's sake, don't mention the possibility of 5 million jobs going away! He needs to leave the fearmongering to the MSM. They do a great job of that.

Russian Help on Afghanistan

No, the headline above is not a non-sequitur, as much as it may seem like one. It springs from this article I just read on Yahoo!'s news aggregation service.

Now, there are many ways of reading this fairly short news article from Reuters. On the surface, it appears like the incoming Obama administration is already fostering hope in renewed or strengthened relations with the international community. That could be one way of looking at it, since the U.S., NATO, and Russia had a bit of a falling-out after Russia's war with Georgia last summer. Perhaps Big Bad Vlad Putin and Russian President Dmitry* Medvedev felt like they could mend relations with the new Obama administration better than they could with the outgoing Bush administration.**

* I still can never think of a Russian President/Soviet Premier named Dmitry without thinking, of course, of Stanley Kubrik's all-time classic Dr. Strangelove, or How I Learned to Stop Worrying and Love the Bomb (1964). Dmitri Kissoff... ha! Still makes me laugh! There are not many Peter Sellers roles that even begin to approach the hilarity of the three he had in this one movie.

** This, despite Bush's famous quote about meeting with Putin and seeing into his soul.

Another way of looking at the news is that Russia, perhaps, sees another opportunity to exert its influence in a region it has long coveted (unless coveted is too strong a word) during a time of leadership transition in the U.S. government. Russia's offer to "help" us in Afghanistan comes hard on the heels of Tuesday's Inauguration, you have to admit. This honestly could be Obama's first foreign-policy test, but it is too early to tell the true intent of the Russians here.

I loved this quote taken directly from the Reuters article:

"Let us hope the new U.S. administration will be more successful in the Afghan settlement than its predecessor," Medvedev told a news conference after talks with Uzbek President Islam Karimov.

Or did he mean, "...more successful than WE were in suppressing the Islamic Mujahideen resistance during our decade-long entanglement in Afghanistan"?!! Which raises a great deal of questions all on its own.

I was old enough to remember the nightly news covering the Soviet invasion of Afghanistan when I was a child. I clearly remember President Jimmy Carter boycotting the 1980 Summer Olympics in Moscow in retalliation for the invasion, which then was repaid in kind by the Eastern Bloc countries boycotting the 1984 Summer Olympics in Los Angeles, CA.

One thing I was never fully clear on, and I don't think the nightly news programs* ever answered on their own, was WHY the Soviets felt compelled to invade Afghanistan in the first place. It was pretty clear why the U.S. responded the way it did, and the movie they made starring Tom Hanks and Julia Roberts on Charlie Wilson's War (2007) provided a nice historical perspective, even if it wasn't 100% true. On this topic, the Wikipedia page provides some information related to the events leading up to the Soviet invasion, but it should not be trusted as a source for a deeper understanding of the Soviet rationale.

* The one we probably watched over any others at the time was Dan Rather on the CBS Nightly News, and oh, how long ago does that seem now! Who watches the evening news any more these days?

So, before I go off to the library in search of more scholarly tomes on the Soviet invasion of Afghanistan, I thought I would post the question here: does anyone know which book(s) are the best one(s) on this topic? Wikipedia actually does a decent job of listing source material for the footnotes, all of which are found at the bottom of the page linked above. I could sift through those footnotes to find books on the topic, I suppose. Even then, you always want to be reading the right books, right?

All I know is this: the rationale for the Soviet invasion I remember as being provided at the time, that the Soviets were looking to secure a warm-water port outside their Black Sea fleet, is completely bogus.