Noam Chomsky is a philosopher, political theorist and professor of linguistics at the Massachusetts Institute of Technology.

Markets have inherent and well-known inefficiencies. One factor is failure to calculate the costs to those who do not participate in transactions. These "externalities" can be huge. That is particularly true for financial institutions.

Their task is to take risks, calculating potential costs for themselves. But they do not take into account the consequences of their losses for the economy as a whole.

State capitalist institutions [are] designed in large measure to socialise cost and risk and privatize profit, without a public voice

Hence the financial market "underprices risk" and is "systematically inefficient," as John Eatwell and Lance Taylor wrote a decade ago, warning of the extreme dangers of financial liberalization and reviewing the substantial costs already incurred - and also proposing solutions, which have been ignored.

The threat became more severe when the Clinton administration repealed the Glass-Steagall act of 1933, thus freeing financial institutions "to innovate in the new economy," in Clinton's words - and also "to self-destruct, taking down with them the general economy and international confidence in the US banking system," financial analyst Nomi Prins adds.

The unprecedented intervention of the Fed may be justified or not in narrow terms, but it reveals, once again, the profoundly undemocratic character of state capitalist institutions, designed in large measure to socialise cost and risk and privatize profit, without a public voice.

That is, of course, not limited to financial markets. The advanced economy as a whole relies heavily on the dynamic state sector, with much the same consequences with regard to risk, cost, profit, and decisions, crucial features of the economy and political system.

Here's the Best Quotes of the Week!!!

Here’s what John McCain had to say about the wonders of market-based health reform:

"Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation."

(Source: "Better Health Care At Lower Cost For Every American " By John McCain 'Contengencies', Sept / Oct 08 Issue)

"Senator McCain's quick-trigger tendency dovetails with his temper. Would he REALLY have fired Chairman Cox on such a whimsical and inaccurate basis? The thought is not a little worrisome."
-- June Oh, responding to "McCain's Scapegoat

Here's Paul Gigot conducting a 'fair and balanced' interview about Sarah Palin during this    Sunday's edition of 'The Wall Street Journal Hour" on the Fox Cable News Network.
(Shows like this used to be called 'infomercials' in the good old days...

Gigot: Kim, what did you think about Sarah Palin's interview performance?

Strassel: I think she came off pretty well. Look, does everyone in America know the Bush doctrine? Maybe not, but she talked pretty comprehensively about most of the stuff that she was asked. And also, it's going to be worthwhil

Medvedev: I’m surprised to hear such a position, because the league was established from one side by a group of companies. Some of them are partially state-owned, like Gazprom — and by the way Gazprom is 49.998 percent in the hands of private shareholders. Some other companies are also of mixed capital, but also three fully private companies have helped establish the league. From 24 clubs, if I’m not mistaken, more than a dozen of the clubs have decided to become members of the business unit of the KHL, so they became shareholders also. These clubs are private entities. So actually the KHL is an entity of mixed capital, and the state doesn’t have a majority in this venture.

"At this point I should note that for the first time, both the United States secretary of state and secretary of defense have doctorates in Russian studies. A fat lot of good that?s done us."

DEFENSE SECRETARY ROBERT M. GATES,on evaporating hopes for closer ties with Russia

"The unprecedented intervention of the Fed... reveals, once again, the profoundly undemocratic character of state capitalist institutions"

Noam Chomsky
Linguist and political theorist

"We have seen... the last gasp of the belief that the way to secure prosperity is to let free markets rip"

Brendan Barber
Trades Union Congress secretary general

Mass-Market Atheism

Okay, so atheism isn’t exactly a new idea; indeed, it’s humanity’s oldest or second-oldest theological theory, depending on how you play the chicken-and-egg game with belief and unbelief. But you have to go all the way back to late-Victorian scoffers like Robert Ingersoll and Mark Twain to find a moment when celebrity skeptics enjoyed the sort of mass-market success that ours—from Christopher Hitchens and Sam Harris to Daniel Dennett and Richard Dawkins—are enjoying in America today.

In part, the vogue for atheistic tracts reflects the talents of the tractarians in question. But it also reflects the slow but steady growth of America’s secular demographic, and its newfound self-consciousness. The post-9/11 moment, in particular, seems to have made unbelievers feel unexpectedly embattled, besieged by fundamentalists both abroad and at home. And there’s nothing quite like a feeling of embattlement to forge solidarity—and sell books.

In this sense, the new mass-market atheism is following the same pattern as the Christian Right before it, which likewise drew strength from a sense of embattlement and persecution. These mirror-image movements can be seen as backlashes against the genteel secularism of mid-century, with its faintly condescending respect for the idea of Religion, and its studious indifference toward actual belief. This backlash has made debates over religion more polarizing than they used to be—and also more interesting.

 

"Senator McCain's quick-trigger tendency dovetails with his temper.

 Would he REALLY have fired Chairman Cox on such a whimsical

and inaccurate basis? The thought is not a little worrisome."


-- June Oh, responding to "McCain's Scapegoat."

"At this point I should note that for the first time, both the United States secretary of state and secretary of defense have doctorates in Russian studies. A fat lot of good that?s done us."

DEFENSE SECRETARY ROBERT M. GATES,on evaporating hopes for closer ties with Russia

Imagine for a minute that attending the Republican convention in St. Paul, sitting in a skybox overlooking the convention floor, were observers from Russia, Iran and Venezuela. And imagine for a minute what these observers would have been doing when Rudy Giuliani led the delegates in a chant of “drill, baby, drill!” I’ll tell you what they would have been doing: the Russian, Iranian and Venezuelan observers would have been up out of their seats, exchanging high-fives and joining in the chant louder than anyone in the hall — “Yes! Yes! Drill, America, drill!” — because an America that is focused first and foremost on drilling for oil is an America more focused on feeding its oil habit than kicking it.

Why would Republicans, the party of business, want to focus our country on breathing life into a 19th-century technology — fossil fuels — rather than giving birth to a 21st-century technology — renewable energy? As I have argued before, it reminds me of someone who, on the eve of the I.T. revolution — on the eve of PCs and the Internet — is pounding the table for America to make more I.B.M. typewriters and carbon paper. “Typewriters, baby, typewriters.”

Of course, we’re going to need oil for many years, but instead of exalting that — with “drill, baby, drill” — why not throw all our energy into innovating a whole new industry of clean power with the mantra “invent, baby, invent?” That is what a party committed to “change” would really be doing. As they say in Texas: “If all you ever do is all you’ve ever done, then all you’ll ever get is all you ever got.”

I dwell on this issue because it is symbolic of the campaign that John McCain has decided to run. It’s a campaign now built on turning everything possible into a cultural wedge issue — including even energy policy, no matter how stupid it makes the voters and no matter how much it might weaken America.

I respected McCain’s willingness to support the troop surge in Iraq, even if it was going to cost him the Republican nomination. Now the same guy, who would not sell his soul to win his party’s nomination, is ready to sell every piece of his soul to win the presidency.

In order to disguise the fact that the core of his campaign is to continue the same Bush policies that have led 80 percent of the country to conclude we’re on the wrong track, McCain has decided to play the culture-war card. Obama may be a bit professorial, but at least he is trying to unite the country to face the real issues rather than divide us over cultural differences.

A Washington Post editorial on Thursday put it well: “On a day when the Congressional Budget Office warned of looming deficits and a grim economic outlook, when the stock market faltered even in the wake of the government’s rescue of Fannie Mae and Freddie Mac, when President Bush discussed the road ahead in Iraq and Afghanistan, on what did the campaign of Senator John McCain spend its energy? A conference call to denounce Senator Barack Obama for using the phrase ‘lipstick on a pig’ and a new television ad accusing the Democrat of wanting to teach kindergartners about sex before they learn to read.”

Some McCain supporters criticize Obama for not having the steel in his belly to use force in the dangerous world we live in today. Well I know this: In order to use force, you have to have force. In order to exercise leverage, you have to have leverage.

I don’t know how much steel is in Obama’s belly, but I do know that the issues he is focusing on in this campaign — improving education and health care, dealing with the deficit and forging a real energy policy based on building a whole new energy infrastructure — are the only way we can put steel back into America’s spine. McCain, alas, has abandoned those issues for the culture-war strategy.

Who cares how much steel John McCain has in his gut when the steel that today holds up our bridges, railroads, nuclear reactors and other infrastructure is rusting? McCain talks about how he would build dozens of nuclear power plants. Oh, really? They go for $10 billion a pop. Where is the money going to come from? From lowering taxes? From banning abortions? From borrowing more from China? From having Sarah Palin “reform” Washington — as if she has any more clue how to do that than the first 100 names in the D.C. phonebook?

Sorry, but there is no sustainable political/military power without economic power, and talking about one without the other is nonsense. Unless we make America the country most able to innovate, compete and win in the age of globalization, our leverage in the world will continue to slowly erode. Those are the issues this election needs to be about, because that is what the next four years need to be about.

There is no strong leader without a strong country. And posing as one, to use the current vernacular, is nothing more than putting lipstick on a pig.

 

Wow, if not for the fact that Americans can rely on their BIG federal government, think about how many Americans would be screwed if AIG had collapsed after the dual damages caused by the recent Hurricanes...

So much for the crown policy of the Reagan years... Deregulation!!!

Kind of reminds me of what happened to Americans belief in the Protestant Work Ethic the last time free markets and a laissez faire business environment was allowed to run wild:

It was totally discredited, like deregulation!!!

Men that had worked hard and lived right their entire lives were forced to sell apples for five cents under a bridge during the Great Depression through no fault of their own...

We all see what's happening now; Who's man enough to admit the obvious truth behind those problems on the right or left???

Read "The Post Lehman World" by David Brooks and then read what's posted after it... Then comment!!!

The Post-Lehman World

A few years ago, real estate was all the rage. Earlier this year, the business magazines were telling us to invest in Lehman Brothers and Merrill Lynch, because those stocks were bound to zoom. Now another herd is on the march.

We’re in a paradigm shift, its members say. The current financial turmoil marks the end of the era of wide-open global capitalism. Today’s gigantic government acquisitions signal a new political era, with more federal activism and tighter regulations.

This observation is then followed by a string of ethereal gottas and shoulds. We gotta have smart regulation that offers security but doesn’t stifle innovation. We gotta have rules that inhibit reckless gambling without squelching sensible risk-taking. We should limit excesses during booms and head off liquidations when things go bad.

It all sounds great (like buying a house with no money down), but do you mind if I do a little due diligence?

In the first place, the idea that our problems stem from light regulation and could be solved by more regulation doesn’t fit all the facts. The current financial crisis is centered around highly regulated investment banks, while lightly regulated hedge funds are not doing so badly. Two of the biggest miscreants were Fannie Mae and Freddie Mac, which, in theory, “were probably the world’s most heavily supervised financial institutions,” according to Jonathan Kay of The Financial Times.

Moreover, there is a lot of lamentation about Clinton era reforms that loosened restrictions on banks. But it’s hard, as Megan McArdle of The Atlantic notes, to see what these reforms had to do with rising house prices, the flood of foreign investment that fed the credit bubble and the global creation of complex new financial instruments for pricing and distributing risk.

In other words, maybe there is something more going on here than just a bunch of laissez-faire regulators asleep at the wheel. But even if it is true that we need more federal activism, I’m a little curious about what we’re going to need to make the system work.

Surely, we’re going to need lawmakers who understand what caused the current meltdown and who can design rules to make sure it doesn’t happen again. And yet there’s no consensus about what caused this bubble.

Some people blame the Fed’s monetary policies, but some say the Fed had only a marginal effect. Some argue a flood of foreign investment allowed us to live beyond our means, while others say bad accounting regulations after Enron created a chain reaction of losses.

We don’t even have a clear explanation about the past, yet we’re also going to need regulators who understand the present and can diagnose the future.

We’re going to need regulators who can anticipate what the next Wall Street business model is going to look like, and how the next crisis will be different than the current one. We’re going to need squads of low-paid regulators who can stay ahead of the highly paid bankers, auditors and analysts who pace this industry (and who themselves failed to anticipate this turmoil).

We’re apparently going to need an all-powerful Super-Fed than can manage inflation, unemployment, bubbles and maybe hurricanes — all at the same time! We’re going to need regulators who write regulations that control risky behavior rather than just channeling it off into dark corners, and who understand what’s happening in bank trading rooms even if the C.E.O.’s themselves are oblivious.

We’re also going to need regulators who can overcome politics and human nature. As McArdle notes, cracking down on subprime loans just when they were getting frothy would have meant issuing an edict that effectively said: “Don’t lend money to poor people.” Good luck with that.

We’d need regulators who could spot a bubble and squelch a boom just when things seem to be going good, who can scare away foreign investment and who could over-rule popularity-mongering presidents. (The statements by the two candidates this week have been moronic.)

To sum it all up, this supposed new era of federal activism is going to confront some old problems: the lack of information available to government planners, the inability to keep up with or control complex economic systems, the fact that political considerations invariably distort the best laid plans.

This doesn’t mean there’s nothing to be done. Martin Wolf suggests countercyclical capital requirements. Everybody seems to be for some updated version of the Resolution Trust Corporation, though disposing of complex debt securities has got to be more difficult than disposing of commercial real estate.

It’s just that there’s a big difference between dreaming of some ideal regulatory regime and actually putting one into practice. Everybody says we’re about to enter a new political era, rich in global financial regulation. The herd might just be wrong once again.

Ach!!!

Calling David Brooks; Earth to David Brooks. Do you read me, over? I repeat: Calling David Brooks; Earth to David Brooks. Do you read me, over? This is reality-based sanity, over. C'mon David, let us know you're still in our stratosphere, over.

I think we've lost David Brooks!!! After reading his latest column, “The Post- Lehman World,” I'm at least certain he's at least exited the place all too few of us are living in already: Reality.

Pity. Sometimes that guy can really get you thinking and give you hope that the American right wing has almost developed an intellect as evolved as the rest of us; But then he goes and writes a bunch of mumbo- jumbo that leaves me mystified as to how he managed to snag a columnist for the N.Y. Times and hold onto it as well for so long.

For example: In his column “The Post-Lehman World” Brooks expresses his doubts about the new regulations the federal government is planning to create for our financial markets in response to the current problems beseeching the global financial system currently.

“The current financial crisis is centered around highly regulated investment banks,” Brooks misleadingly states. Then he actually pulls out one of the oldest right wing plays out of the book to follow that assertion up; Blame the Clinton years.

“There is a lot of lamentation about Clinton era reforms that loosened restrictions (???) on banks,” alleges Brooks.

What precisely is that supposed to mean, anyway? “A lot of lamentation?” By who? Is Brooks actually trying to pin the ill effects of deregulation on Democrats??? Deregulation??? The crown prince of Reagan policies???

Sorry David; Michael Milken was pulling Ponzi schemes on Savings and Loan Institutions back in the early 80's by taking advantage of the (then) deregulation of the industry.... Bill Clinton might not have had his first affair by then!

Anyway- didn't you tell us that deregulation wasn't the real problem, because “the current financial crisis is centered around highly regulated investment banks?” So why blame Clinton for causing problems by loosening restrictions on banks- aka deregulating them- laughable of an accusation as that is?

First: Remember the 80's??? Ah, there were those Air Traffic Controllers that Reagan fired because they went on an 'illegal' strike, and there was the S & L scandals, as I mentioned. Who could forget the rise of the Yuppies and Gordon Gekko proclaiming that “Greed is Good!” in the movie Wall Street? Ever wonder how John De-Lorian is doing and if any of his cars still run?

Those are all memories created specifically because of the deregulation of the 80's!!! Ronald Reagan. George Bush Sr. The lovable Danny Quayle.

No Bill Clinton, David Brooks. Lotta cocaine, lotta fast money, no horny, sax playing presidents from Arkansas.

The Clinton Years= Whitewater + Ken Starr x Monica Lewinsky (2) – 1 stained blue dress + NAFTA x 2. “Lamentation about Clinton era reforms that loosened restrictions on banks-” or deregulation- ain't part of the equation.

However Brooks is right to point the finger at deregulation as the primary culprit that made the current problems now gutting stock exchanges around the globe possible... even though that makes his claim that deregulation isn't the problem (laughably) wrong.... and even though Brooks seems to be saying deregulation is only wrong when a Clinton can be blamed for the destruction it inevitably causes in a society that celebrates- even worships- capitalism, free markets, Milton Friedman, and Ann Rand- such as ours.

“Two of the biggest miscreants were Freddie Mae and Fannie Mac,” institutions which, Brooks tells us, “were probably the world's most heavily supervised financial institutions.” Brooks backs this statement up by crediting it to Johnathon Kay of The Financial Times, but in reality he's simply misleading his readers once again by mixing and matching quotes from credible sources that may or may not have been taken out of context to back up his statements.

Freddie Mae and Frannie Mac ran into problems with Sub Prime Mortgages precisely because of a lack of regulations being applied or followed by: The Mortgage industry. The Credit Rating companies that were able to legally 'repackage' those mortgages as being a triple A rated investment opportunity and resell them to investment banks and individual investors around the world who had no clue what they were buying.

There is no one, no country, no agency, in charge of the global economy; As Thomas Friedman famously described it the globalized economy is like a giant herd that sets it's own rules. You either figure those rules out and follow them or you fall out of the herd, which means you're all alone, and in the financial world it's impossible to survive by yourself.

It also made it vital for each investor around the globe to 'repackage' and resell the worthless sub prime mortgages after they'd invested in them and realized they'd invested in nothing; On average each repackaged 'bundle' of sub prime mortages (and other derivatives... if you don't know what a derivative is, google it..) was resold 4 times around the global financial system and because of a pervasive belief in unfettered free markets, belief in a laissez-faire business environment, and influential men like Alan Greenspan and Milton Friedman that believed in deregulation religiously, it was able to happen.

Small government? Deregulation? That damn joke McCain always credits Reagan for telling him that he always retells to his audiences- you know- McCain mentions how Reagan used to say “Congress spends money like a Drunken Sailor,” and then he got a call one day from a man who said “As a Drunken Sailor, I resent that remark” to McCain?

Hah!

No big government, no bailout of AIG.
No bailout of AIG, tens of thousands of Hurricane victims wind up screwed.

Free markets + Deregulation= huge income gap, cuts in social services, tax inequities, a Great Depression in the 30's, and a near collapse of the global financial system today.

Ditch the Ann Rand cultists, David; C'mon back to reality. Leave Bill alone and just face up to the failures of deregulation, please.

Those of us living in the reality based world would love to see just one member of the ideological right do it.

The UK, the US and many countries around the world are reeling from the current financial crisis. But who is being blamed and how valid is that blame?

Newspapers on either side of Atlantic are leading the inquest into just how the current economic crisis got this bad, gripping the United States and UK and spreading to Russia and Asia.

Several categories of individuals and institutions stand accused.

The root of much of the current difficulties lies in the sub-prime loans market, predominantly in the US. The sub-prime category refers to the category of borrowers at the highest risk of defaulting on their loan - perhaps those with a poor credit history or unreliable income.

The reason why this market became popular among lenders is simple, says Alex Brummer, City editor of the Daily Mail and author of The Crunch.

The turmoil seems unlikely to end soon

"The poorest people pay the highest interest rates," he says. In the low interest rate years after 2001, sub-prime borrowers might pay two or three times the interest of a prime borrower.

And if some defaulted, it wasn't the end of the world. Property prices were rising so fast in the US that the odd repossession wasn't a major problem. In an atmosphere of speculation, many people saw there was money to be made in property and so the spiral continued.

"There were strippers in Las Vegas who became real estate brokers," says Brummer.

But when the housing market took a turn for the worse, the problems started. Many borrowers were on deals that for the first two years had low rates and then switched to a much higher rate. Once house prices fell, borrowers who were struggling started defaulting on loans. Repossessed houses flooding onto the market caused a vicious circle.

By April this year, the FBI was already investigating 19 allegations of corporate fraud relating to sub-prime loans.

Of course, if it was just a case of sub-prime lenders suffering a rash of defaults, then the layman might assume that the damage would be limited to those lenders - like IndyMac and New Century - that have collapsed.

Architects of their own misery?

But these sub-prime loans were parcelled up and turned into complex financial products traded on markets all over the world. The esoteric nature of some of the products related to these loans has been blamed by many for the extent of the crisis.

"You have to ask what was driving the sub-prime market," says Brummer. "It was the demand from the Wall Street investment banks. It had such good returns. They were incentivising [the lenders].

"The PhD mathematicians found ways of doing sub-prime loan derivative products and an insurance system."

One year ago, "short-selling" was a term that would have baffled most.

Now it is being widely blamed on both sides of the Atlantic for some of the worst symptoms of the current crisis.

WHAT IS SHORT-SELLING? Short sellers borrows share Sells share on market Share price falls Short seller repurchases share Share returned to original owner The price difference is mostly profit

A short seller effectively bets on the price of an asset, often a share, falling. Typically this is done by borrowing the share from the owner. The share is then sold and when the price drops it is repurchased and returned to the original owner. The short seller pockets the difference.

A headline from Britain's Daily Express sums up the mood: "Don't let the spivs destroy Britain." The Daily Mail's take was not dissimilar when it said: "Spivs, sharks and why the champagne corks were popping on meltdown Monday."

In the US, Republican presidential candidate John McCain may have spoken for many when he attacked some types of short selling.

The practice has now been temporarily banned for shares in many listed financial companies in both the UK and the US.

Overvalued shares

But the stance of Hector Sants, boss of the Financial Services Authority, is revealing: "While we still regard short-selling as a legitimate investment technique in normal market conditions, the current extreme circumstances have given rise to disorderly markets."

But there are some who say short-selling helps bring overvalued shares to heel.

The Securities and Exchange Commission kept in place trading rules that let speculators and hedge funds turn our markets into a casino John McCain

"All that short sellers do is kind of force prices which are the true price even faster," says Dr Thomas Kirchmaier, a member of the London School of Economics' Financial Markets Group and an expert in corporate governance.

In other words, what leads sellers to short is finding out a particular asset is overvalued. But the process can be traumatic and generate its own momentum.

"[There is a view that] all it does is speed up reassessment of an institution - in a few days rather than a few months," says Brummer. "But it is the suddenness that produces this immediate shock."

At the moment the speed of the price drop robs governments and central banks of a chance to formulate a plan for intervention, meaning that the next domino soon falls.

In the US, the three-pronged regulation of finance by the Treasury, Federal Reserve and the Securities and Exchange Commission has been criticised. In the UK, the roles of the Financial Services Authority, Bank of England and government has also been questioned.

John McCain has openly called for the head of the SEC to go. "The Securities and Exchange Commission kept in place trading rules that let speculators and hedge funds turn our markets into a casino," he said in one speech.

US Treasury Secretary Henry Paulson knows the markets well having been head of Goldman Sachs

And there are plenty who take an equally dim view of the British equivalent, the FSA.

"In Britain light touch regulation in the case of Northern Rock and HBOS was no touch regulation," says Brummer. "The degree of supervision on who becomes chief executive of these banks is just not good enough."

But some, like Brummer, feel the FSA faces a struggle, armed as it is with small numbers of staff paid far less than those they police.

For Professor Richard Portes, founder of the Centre for Economic Policy Research, regulators and central bankers have been extraordinarily myopic.

"They should still have seen a lot of warning signs, in particular in looking at off-balance sheet operations."

A key issue is the opacity of the banking system. If no-one can truly assess the liabilities of a given financial institution, how can they confidently lend it money? But this has helped people make money.

"You make money when it is opaque, you make money when you have got information that other people don't have," says Prof Portes.

And there are those who point the finger at the light touch of Alan Greenspan, chairman of the Federal Reserve from 1987 until 2006.

"He let them get away with murder," says Dr Kirchmaier. "At the same time he had this monetary expansion - he would always bail out the market."

The theory is that as financial institutions knew they were not bearing all of the risk, they have not acted as prudently as they might.

"You can't let these banks go down because the impact on society is enormous. It is the state who has to bail out the banks."

The first major casualty of the credit crunch in Britain was the Northern Rock bank, and there has been plenty of criticism of Chancellor Alastair Darling and Prime Minister Gordon Brown over the handling of its crisis and nationalisation.

The government in the UK, as in the US, has argued that this is a global crisis which cannot be put at the door of a handful of politicians.

But there are some who believe it can indeed, if only for the failure to speak out against certain excesses while the going was good.

"Politicians bear some responsibility in Britain," says Brummer. "We allowed a culture of credit creation. At the end of last year the amount of credit in the economy was roughly the size of national output - the highest it's ever been."

From CNN's Jack Cafferty

Is John McCain advocating reform for reform's sake, or does he have a pressing agenda? by Jack Beatty February 16, 2000 John McCain wants to reform politics, but to what end? What does he want to do with government when it's no longer under the sway of "the special interests" he tilts against in every speech (without naming them or identifying their nefarious fingerprints on a particular bill)? McCain is running on more than his biography, but his reform agenda is long on process and short on policy. In a recent speech before a hall full of South Carolinians -- who were moved listening to a man who braved captivity and torture for love of country -- McCain sketched in his platform. He wants to reform the military, and this means making it a more attractive career for young men and women (his biggest applause line came when he promised that "under a McCain Administration no member of the military will be on Food Stamps"). He wants to reform education, for which campaign-finance reform is a prerequisite -- only after the dreaded teacher's unions no longer fund the Democratic Party, he says, will it be possible to implement public/private school choice, his remedy for failing schools. McCain wants to privatize a portion of Social Security, to resolve the funding crisis facing it after 2010 or so, and to dedicate much of the surplus to reducing the national debt. But despite these stump-speech specifics McCain is notably ill at ease answering questions about domestic policy, The New York Times reports, and when pressed resorts to Perot-like pledges that, once elected, he will gather "the best minds in America" to help him decide what to do. McCain, basically, is a process politician, a Mugwump who will make government more efficient and less wasteful -- not cut its size, nor ask it to do new things. The goal of McCainism is, Mugwump-like, to make politics and government respectable to young people whose political alienation is a civic danger. But young people care about more than process, the Mugwump's fetish. They want a government that delivers, that makes a difference in their lives, that hinders the hindrances, to use an old formulation of the credo of liberalism, that stand between them and their hopes. Writing in The Weekly Standard, William Kristol and David Brooks find wider purpose in McCain's reform crusade, seeing it as "part of a more comprehensive ambition to reinvigorate citizenship." While George W. Bush appeals to self-interest with his call for deep tax cuts, McCain appeals to public-spiritedness in summoning young Americans to embrace causes bigger than themselves. Kristol and Brooks summarize McCain's vision this way: We should think of ourselves as citizens, not merely as consumers; we should serve the public good, not merely private interest; we should be represented in Washington as Americans, not merely as members of interest groups and taxpayers.... His brand of conservatism rejects the notion that the highest end of government is to leave us alone. It is difficult to square this powerful Periclean rhetoric with McCain's embrace of Newt Gingrich's Contract With America, a libertarian manifesto. Brooks and Kristol make McCain sound like the new John F. Kennedy, who in 1960 campaigned on sacrifice and "national greatness," an ideal Kristol wants the GOP to brand. As a fifteen-year-old in 1960, I was stirred by JFK's heroic vision of a country that would redeem the world for liberty, but that hubristic idealism, I now see, led directly to Vietnam, where thousands of young Americans got a bellyful of sacrifice. In this connection it's worth remembering that McCain advocated the use of U.S. ground troops to drive Serb forces out of Kosovo. Is this the stuff of which "national greatness" is made -- ground troop interventions in regions where no vital U.S. interests are at stake? I'd rather a government that saw national greatness in reducing child poverty and expanding social insurance to cover long-term nursing-home care for seniors -- prosaically material ends, no doubt, "the bread and tea of life," in Dr. Johnson's phrase, but vital props of the independence that supports citizenship. If, however, I had to choose between McCain-style national greatness and the hoary GOP alternative, I'd prefer the latter -- a government that would "leave us alone." Join the conversation in the Politics & Society conference of Post & Riposte. More on politics and society in Atlantic Unbound and The Atlantic Monthly. Jack Beatty is a senior editor at The Atlantic Monthly and the author of The World According to Peter Drucker (1997) and The Rascal King: The Life and Times of James Michael Curley (1992). Copyright © 2000 by The Atlantic Monthly Company.

Op-Ed Columnist Hoping It’s Biden By DAVID BROOKS Published: August 22, 2008 Barack Obama has decided upon a vice-presidential running mate. And while I don’t know who it is as I write, for the good of the country, I hope he picked Joe Biden. Skip to next paragraph David Brooks Go to Columnist Page » The Conversation Biden’s weaknesses are on the surface. He has said a number of idiotic things over the years and, in the days following his selection, those snippets would be aired again and again. But that won’t hurt all that much because voters are smart enough to forgive the genuine flaws of genuine people. And over the long haul, Biden provides what Obama needs: Working-Class Roots. Biden is a lunch-bucket Democrat. His father was rich when he was young — played polo, cavorted on yachts, drove luxury cars. But through a series of bad personal and business decisions, he was broke by the time Joe Jr. came along. They lived with their in-laws in Scranton, Pa., then moved to a dingy working-class area in Wilmington, Del. At one point, the elder Biden cleaned boilers during the week and sold pennants and knickknacks at a farmer’s market on the weekends. His son was raised with a fierce working-class pride — no one is better than anyone else. Once, when Joe Sr. was working for a car dealership, the owner threw a Christmas party for the staff. Just as the dancing was to begin, the owner scattered silver dollars on the floor and watched from above as the mechanics and salesmen scrambled about for them. Joe Sr. quit that job on the spot. Even today, after serving for decades in the world’s most pompous workplace, Senator Biden retains an ostentatiously unpretentious manner. He campaigns with an army of Bidens who seem to emerge by the dozens from the old neighborhood in Scranton. He has disdain for privilege and for limousine liberals — the mark of an honest, working-class Democrat. Democrats in general, and Obama in particular, have trouble connecting with working-class voters, especially Catholic ones. Biden would be the bridge. Honesty. Biden’s most notorious feature is his mouth. But in his youth, he had a stutter. As a freshman in high school he was exempted from public speaking because of his disability, and was ridiculed by teachers and peers. His nickname was Dash, because of his inability to finish a sentence. He developed an odd smile as a way to relax his facial muscles (it still shows up while he’s speaking today) and he’s spent his adulthood making up for any comments that may have gone unmade during his youth. Today, Biden’s conversational style is tiresome to some, but it has one outstanding feature. He is direct. No matter who you are, he tells you exactly what he thinks, before he tells it to you a second, third and fourth time. Presidents need someone who will be relentlessly direct. Obama, who attracts worshippers, not just staff members, needs that more than most. Loyalty. Just after Biden was elected to the senate in 1972, his wife, Neilia, and daughter Naomi were killed in a car crash. His career has also been marked by lesser crises. His first presidential run ended in a plagiarism scandal. He nearly died of a brain aneurism. New administrations are dominated by the young and the arrogant, and benefit from the presence of those who have been through the worst and who have a tinge of perspective. Moreover, there are moments when a president has to go into the cabinet room and announce a decision that nearly everyone else on his team disagrees with. In those moments, he needs a vice president who will provide absolute support. That sort of loyalty comes easiest to people who have been down themselves, and who had to rely on others in their own moments of need. Experience. When Obama talks about postpartisanship, he talks about a grass-roots movement that will arise and sweep away the old ways of Washington. When John McCain talks about it, he describes a meeting of wise old heads who get together to craft compromises. Obama’s vision is more romantic, but McCain’s is more realistic. When Biden was a young senator, he was mentored by Hubert Humphrey, Mike Mansfield and the like. He was schooled in senatorial procedure in the days when the Senate was less gridlocked. If Obama hopes to pass energy and health care legislation, he’s going to need someone with that kind of legislative knowledge who can bring the battered old senators together, as in days of yore. There are other veep choices. Tim Kaine seems like a solid man, but selecting him would be disastrous. It would underline all the anxieties voters have about youth and inexperience. Evan Bayh has impeccably centrist credentials, but the country is not in the mood for dispassionate caution. Biden’s the one. The only question is whether Obama was wise and self-aware enough to know that. More Articles in Opinion » A version of this article appeared in print on August 22, 2008, on page A19 of the New York edition. 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