Sunday, August 07, 2011

8.7.11: Downgrading America and Its Greatness

If these two interviews serve as any indication of where this country is headed then we're most assuredly headed for another downgrade of some sort. Unfortunately, to put these discussions in context, we have to quote a few first worsts that occurred this week, actually in one day - Friday August 5th, 2011. On this day, Standard & Poor's, the credit rating agency, downgraded the United States of America's credit rating for the first time in its history. We were first rated back in 1941. Secondly, we suffered the single deadliest day in the Afghanistan war losing 33 soldiers, which included 22 navy seals. It seemed like the official day that officially ended America's greatness.

You have to basically ignore Senator McCain's criticisms of the President due to his bitterness of losing the election, he begins every answer with a jab, and in this case it was the President's decision on the timetable for the troop draw down in country and that he did not consult the military. This, we have to point out, is not the case as the President clearly took the advice of David Petraeus, or he would have done with the previous President would have down, follow the order or be fired. President Obama promoted General Petraeus to CIA head.

With that, the two Senators, Kerry and McCain, basically agree on most points in relation to this conflict, which is that Pakistan is a major player in the problems we have in Afghanistan. The Taliban also needs to be quelled, lest it harbor sanctuary for Al Qaeda again. Lastly, they both agree on the fact that several factions in the country are struggling to gain control.

On the draw down timetable, McCain thinks its too soon, and Kerry really didn't say because he won't publicly criticism the Administration on this front. Now, we're not military experts, but for our two cents, we disagree with both senators, and here's something to give thought to given the two differing perspectives.

First, the timetable for troop draw downs is fine, but what should the adjusted force look like, and what should be its function? We believe that it has a lot to do with how the Taliban think and what they respond to, and frankly, it's two things - uncertainty and ruthlessness. Draw down the troops so that Bagram Airbase is our huge center of operation - almost a city-state unto itself with 30,000 troops - fortified. Then run operations out of there and have troops at the ready stationed in other nearby country bases and on aircraft carriers at the edge of the region. This way, if any surge is needed, it can be accomplished quickly.

Also, how we run these operations is crucial. First, the tasks they wouldn't be responsible for would nation-building, having forward outposts in remote areas, and fighting the opium trade. However, it should support the central government by extension of the Administration's policies. The Taliban respond to the fear of the unknown. Having a large number of troops in one location, especially with the amount of fire power the U.S. military has, centralizes things and could make us more unpredictable in where we strike the Taliban, consistent covert missions with maximum strike force (a bit of the Powell Doctrine in there). Instill fear in the enemy that you will be unpredictable and mercilessly powerful, and you will see the Taliban shrink, while the central government can do more to build itself up. It may seem hawkish, but not really because look how everyone viewed the operation to kill Osama Bin Laden. We were all pretty impressed. Use reconnaissance to spot Taliban strong holds, and then instill some real feature, if you know what we mean.

Senator Kerry said that we need to get the other countries in the region involved - China, Russian, the other Stans (as he put it), Iran, even India. However, these countries don't want to have anything to do with Afghanistan. Russia's going to help us in Afghanistan? Really?

As it stands, this is a serious blow to the moral of the military. Speaking of being down of course, there was Standard & Poor's downgrading of the United States' credit rating, and this brings us back to the contrasting answers by the two aforementioned Senators.

When asked what we could do to revive the economy, Senator McCain said that we should cut corporate tax rates, put a moratorium on new fiscal regulations, and discuss the big elephant in the room - the entitlements of Medicare and Social Security. By contrast, Senator Kerry talked about a Senate bi-partisan highway bill, an infrastructure bank, regulatory reform, patent reform, cuts in waste to Medicare and Social Security, and revenue increases which of course translates higher taxes in some segment of the population. (We'll just leave that last one at that.)

What we hear from Senator Kerry are solutions that both parties can agree on, something that Austin Goolsbee and David Gregory jousted about during the round table. Mr. Gregory pointed out that Congress never gets to the start and these things never see any light. More bills, specifically in the House, need to have bi-partisan authorship, two people - one from each party. Why isn't that a rule? If you can't make nice on your own, then you have to impose it. Anyone who has gone to any school for one day knows this. Also, if instant citing and knowledge of the facts and details are any indication to the level that one grasps the issue makes a difference, we'd have to give that to Senator Kerry. Pointing out that China spends 9% of GDP on infrastructure, Europe 5%, and the United States only 2%, Mr. Kerry seems to have a better grasp of the whole.

With that said, he did start off the interview calling the credit downgrade a Tea-Party Downgrade. Senator McCain called it a failure of leadership on the part of the President. Taking these two statements together and factor in that Mr. Goolsbee and Ms. Maddow during the roundtable made discrediting remarks about Standard & Poor's, the $2 trillion math error and that S&P will give a triple-A rating to anyone respectively, here's what we can glean from all this.

The leadership failure, as stated by Senator McCain, was that the President's party controlled two-thirds of the government and couldn't get (we're presuming) his agenda through and hence a downgrade. It's pure rhetoric, but let's distill it for a moment. Consider that it takes 60 votes in the Senate (this is a Senate rule, not a law) to pass anything in the Senate, a simple majority (under 60 seats) doesn't do anything for the majority party so it's in fact an even split so the 'control' is limited. It was a moment that required compromise, which the President did offer, but it was rejected by Republicans.

Senator McCain mentioned that we shouldn't blame the Tea Party because the House had a mandate. That's debatable, but if they carried out their mandate then how can he say that the President failed in his leadership. Speaker John Boehner in an interview said that he got 98% of what he wanted and therefore he was happy. While he was getting 98%, some in his caucus were openly calling for the U.S. to default on its debt.

Alex Castellanos, the Republican strategist said that there was intransience on the part of both parties - the Republicans for their tax stance and the Democrats for the spending stance. Ms. Maddow, citing the S&P report in front of her, slammed Mr. Castellanos, said the downgrade was particularly because of the political uncertainty on the debt ceiling crisis. The crisis was, let's be honest, by Republicans and was purely political in nature. Also when Ms. Maddow asked Mr. Castellanos what tax loopholes or subsidies would the Republicans eliminate, he couldn't name one.

So was it a Tea-Party downgrade? Well, Republicans got most of what they wanted because of the Tea-Party caucus, and now we got downgraded... Hmm..... What's really sad is that if you do conclude that it is a downgrade sparked by the Tea-Party's willingness to default, now you see the Democratic Administration defending these actions on behalf of the country. This is the difficult part of governing that frankly, the Republicans won't take responsibility for, they can sit back and blame the President.

Lastly, for his wisdom, Alan Greenspan clearly didn't want to make news. He said that if the Israeli market, which is open today, is any indication that we can look for the downgrade to have a big effect, but then instantly backed off of that. He was even less committal on how to get the U.S. economy going again. He said that tax cuts don't slow the economy as much as spending cuts, which means... what? The one thing that we did finding informative was with regard to a double dip recession, which we feel is coming, is that, as Mr. Greenspan explain, it depend on Europe. Italy is in trouble and it's too big to be bailed out, he said.

Mr. Kerry's last statement was that 'we need to be statesmen here.' We need them badly right now, but sadly, Mr. Kerry was wrong in assuming that Senator McCain could be one of them. All his answers revolved around empty rhetoric so we're officially downgrading John McCain's credit.



Former Chairman of the Federal Reserve, Dr. Alan Greenspan, outgoing White House Economic Adviser, Austan Goolsbee, MSNBC’s Rachel Maddow, and Republican strategist, Alex Castellanos.

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