David Foster

Important Reading

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Fouad Ajami on Obama and the politics of crowds. Excerpt:

My boyhood, and the Arab political culture I have been chronicling for well over three decades, are anchored in the Arab world. And the tragedy of Arab political culture has been the unending expectation of the crowd — the street, we call it — in the redeemer who will put an end to the decline, who will restore faded splendor and greatness.

Via Betsy, who has some interesting commentary:

I heard Mark Steyn say the other day that so many schools today have posters with abstract nouns in the halls like Achievement, Effort, and Character and that it’s no coincidence that a generation educated among such posters would fall hard for a candidate of Hope and Change.

Obama, the Democrats, and the Economy–continued

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(This is a continuation of my post on the election and the economy from several days ago. At that time, I focused on energy and trade; in this update, I also talk about small business, the demonization of entire industries, the micromanagement of innovation, the proposed elimination of the secret ballot in union elections, and corporate tax policy.)

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Heretic-hunting in Hollywood

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Robert Avrech went to a script conference the other day, and ran straight into the Inquisition.

Sarkozy on Obama

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According to Haaretz:

French President Nicolas Sarkozy is very critical of U.S. presidential candidate Barack Obama’s positions on Iran, according to reports that have reached Israel’s government.

Sarkozy has made his criticisms only in closed forums in France. But according to a senior Israeli government source, the reports reaching Israel indicate that Sarkozy views the Democratic candidate’s stance on Iran as “utterly immature” and comprised of “formulations empty of all content.”

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Jack & Suzy Welch on the Economy

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In their BusinessWeek column, Mr and Ms Welch respond to a reader’s question:

How does today’s financial crisis compare with the beginning of the Great Depression and the 1930s?

In response, the Welches say that while “real global pain” lies ahead, the situation is unlikely to wind up in a catastrophe on the Great Depression level. Their reasoning is interesting–basically, they offer 4 factors that differentiate the Depression era from our own:

1)”In 1930 the protectionist Smoot-Hawley Tariff Act ushered in years of international retaliation and discord. Today’s crisis is marked by a high degree of free trade and global cooperation.”

2)”In 1933 the National Industrial Recovery Act encouraged labor and industry cartels. The result was a decline in U.S. competitiveness—again, hardly the current case: American companies have never been in better fighting form.”

(The NIRA was passed in 1933 and was in force until it was found unconstitutional in 1935. It involved cartelization and extreme micromanagement of the economy, and is generally considered to have been one of FDR’s more unwise innovations, delaying rather than assisting the recovery from the Depression. Interestingly, NIRA was strongly backed by Gerard Swope, one of Jack Welch’s illustrious predecessors as head of GE.)

3)”Finally, a second Great Depression is unlikely because of the institutions created to prevent one, foremost being the Federal Deposit Insurance Corp., with its authority to insure deposits, critical to stabilizing the banking system.”

4)”Others say we’re marching into French-style socialism. Au contraire. The U.S. government has a century-long history of handling interventions with a fast-in, fast-out approach. In 1984, to take a recent example, it bought 80% of Continental Illinois National Bank but sold it just 10 years later to Bank of America. In 1989 it created the Resolution Trust Corp., which cleaned up the savings and loan crisis, then quickly packed up. TARP, the federal bailout plan, looks to be no exception, as its loan terms give banks flexibility and strong incentives to pay off the government within five years.”

I agree with Jack and Suzy Welch that we should not be panicking about the economy and that comparisons with 1929 are overdrawn. However, I also think that the economic future will be tremendously influenced by the election results–and that an Obama administration, combined with a strong Democratic congressional majority, would, very likely, dilute or negate three of the four factors that they list as separating us from the Depression era. While the result would probably not look as grim as 1929, it would still be pretty bad.

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