Sunday, September 28, 2008

Obama for the Presidency + Notes on the Economy
It’s been a busy summer professionally so I have not been able to post for a while. I have also been waiting to decide who I was going to vote for, and now I am prepared to endorse Barack Obama for the Presidency.
I was seriously considering voting for John McCain well into August due to his strength on national security, less propensity to raise taxes, and his long record of bipartisanship as well as personal honor & service. But Senator McCain’s selection of Governor Sarah Palin, his performance last week with the financial situation, and several things he said in the 1st debate have sealed my decision to recommend Senator Obama.
Let me revisit the key issues where I think Obama is the best choice and discuss McCain’s weaknesses:
  • National Security:
  • Pakistan: Obama has clearly defined Pakistan as the nest of Islamic fundamentalist evil, something which is 8 years overdue and which my conservative friends have only belatedly come to realize. Osama bin Laden and his gang must be hunted down and destroyed for symbolic and strategic value; it is not an easy problem but I think it will be more easily achieved by a leader who recognizes Pakistan is the problem. McCain, in Friday’s night’s debate is out to lunch on Pakistan: he justified Gen. Musharraf’s coup in 1999 by saying Pakistan was a failed state at the time. This is a blatant rewriting of history. Pakistan was led by a democratically elected Prime Minister at the time (certainly not a failed state in the sense of Somalia or pre-2001 Afghanistan). Background: Musharraf invaded india in june 1999 going behind the back democratically elected prime minister, who ordered a withdrawal. When the PM tried to dismiss Musharraf later that year, Musharraf conducted his military coup. This was widely condemned at the time by democrats, republicans, the UN, and the British Commonwealth. The question must be asked: Does John McCain support a military coup by Pakistan, a nuclear-armed state whose military’s intelligence service is in cahoots with al Qaeda and the Taliban, in the future if its democratic government struggles or tries to impose civilian control of the military?
  • Iran: On the surface, McCain projects a far tougher view on how to approach Iran than Obama, and Obama’s willingness to negotiate directly could indeed be construed as weakness. But let us look at the record – McCain’s approach has indeed been tried for 8 years, and Iran has only gotten closer to nuclear weapons. Maybe diplomacy with carrots & sticks has a shot at shifting Iran’s course (I doubt it) or at least building international acquiescence for military action, but ignoring Iran has not achieved anything. And the bottom line is that no US government and certainly no Israeli government will stand aside Iran to get nuclear weapons. Indeed, I’d like to raise the following question with regard to Republican policy on Iran (first noting that Gen. David Petraeus is a truly brilliant commander, and I don’t want to take anything away from him): was the success of the surge in Iraq enabled/bought by US allowing Iran to continue with its Manhattan Project unfettered (including for example that atrocious National Intelligence Estimate last year saying they pulled out of nuke research) and by the US allowing Assad in Syria to get away with the assassination of Rafiq Hariri (the UN "investigation" into that has gone nowhere)? We'll never know the answer, but i think the question should be asked. Iraq is important, but so are Iran and Syria.

  • Iraq: To reiterate my previous positions, readers know I supported the invasion of Iraq and continuing US military involvement. This judgment call is premised on hopefully turning Iraq into a decent democratic country to promote positive change in theMiddle East, a “democratic domino” theory. Readers will also know I have consistently bashed President Bush’s mismanagement and absence of planning, and worried gravely about the primary motives of this administration. Whether this was the right call or not will not be known for decades. I respect and applaud John McCain’s support for the surge; it was vital political cover at the time for that approach. But we are at a point, both militarily and economically, where $10 billion a month and >100,000 soldiers to support Iraq in an effort to have long-term bases there does not make much sense to me. Iraq wants us out by Dec. 2010; Obama proposes us leaving by June 2010 – that is a negotiable difference. We have finite army resources – might these not be better deployed for action against al Qaeda, possibility of action against Iran, and reserve uses elsewhere?
  • Economy/Financial Situation: McCain’s behavior this past week can charitably be called bizarre. There was an apparent deal (maybe, maybe not) on Wednesday and Thursday morning. McCain asked Bush for a photo op meeting Thursday presumably to emerge as a hero with Obama at his side. If anything, McCain backing House Republican proposals which had been previously rejected and then his mysterious silence in that meeting blew up that meeting. What did he accomplish? Delay. Now one can say that might be a good thing (I have grave reservations about a blank check for $700 billion). But he made this big show about returning to Washington to get a deal done. That along with advisors who say we are in a mental recession and who are pretty weak on economics (vs. Obama’s team of Rubin, Summers, Volcker, and Buffett) makes McCain a poor prospect for leading the economy. As far as the bailout package itself, I will highlight some ideas that I think are good (posited by various sources this past week) below.
  • Fiscal Policy: Obama will spend more, McCain will tax less. Neither have addressed entitlements or the national debt. Both will have this $700 billion (probably more) bailout to deal with. Neither are reassuring to me as far as America’s fiscal health long-term. Indeed, McCain's glib debate line about a spending freeze on everything but entitlements/defense/interest on debt/veterans' care is absurd: there is not much left in discretionary spending, and does he want to freeze spending on the FBI/DEA/Homeland Security/National Institute of Health?

  • Health Care: I have concerns about both candidates’ approaches, but I think Obama’s plan makes more sense than McCain’s of just getting rid of the employer health benefit tax credit to set up a “market.”In any case, McCain’s ideas of privatizing the VA, cutting funding for injured veterans, and his abstentions on preserving Medicare fees for doctors this summer make him a bad choice for me.
  • Science: Our long-term outlook as a nation depends on investment in research & development in medicine, engineering, energy technology, nanotechnology, etc. This link is very instructive. I think it shows Obama has thought much more constructively about maintaining America’s scientific pre-eminence.
  • Energy Policy/Environment: Both support offshore drilling (McCain more so), have extended some support for measures against climate change and for nuclear power, and for alternative energy. Emphases will be different. I don’t think there is that much of a difference.
These I think are the key issues to judge the two candidates. On the merits, I give Obama the edge. But McCain’s experience, service, and toughness could have overridden all of that for me. The clincher for me is McCain’s selection of Palin. She is just Bush + Huckabee on high heels. She is not bright, she is not curious, she is not coherent when dealing with probing questions. She is, in the words of Peggy Noonan (Reagan’s speechwriter), “chirpy” about war with Russia, talks about Putin “rearing his head into Alaskan airspace”, and can’t pronounce nuclear properly or speak “caricature”. She plausibly believes (the quote is unclear) that the Iraq war is “God’s plan”; she certainly said a natural gas pipeline in Alaska was God’s will. She is quite likely a creationist. Let me not even mention what Republicans would do if Obama could not speak proper English (either in pronunciation or grammar) or if Obama had a pregnant teenage daughter (even Republicans have already discussed that in passing). But the last is a distraction. McCain is 72 years old; his #2 pick has to have 2 out of 3 traits – experience, intelligence, or wisdom. I think Sarah Palin strikes out on all 3 counts. Obama has done us the favor of keeping Hillary away from the Presidency; may he do us the additional favor of keeping Sarah Palin away as well.
Notes on Financial Crisis:
Let me conclude with my thoughts, based on what I have read this week, about the financial crisis. If I had a $700 billion check, I could think of a lot of things to do with that money besides a Wall Street bailout. But a lot of serious people are saying a credit freeze would cripple America – I am not sure but we probably should not take the chance. I know people will say too much credit got us into this mess – but I have also seen that heroin withdrawal can be fatal and that such patients need detox – maybe this package will be detox; I certainly hope it puts us on that path. I am glad the Democrats have gotten executive compensation caps, equity stakes for the Treasury, and oversight; I am glad the Republicans have blocked some of the Democrats’ dumb ideas. I think the Republicans’s scheme for government backed insurance is weird and possibly dangerous, setting up potential for a Fannie Mae meets AIG situation in the future (a government sponsored enterprise which is an insurance company). Personally, I wonder whether a better plan (and most of these are not my ideas as I am not well-versed in these issues but those I have picked up from various commentaries in the national press and friends) would be:
  • The Fed providing credit for employer payroll, student loans, municipal bonds, i.e., key lines of credit in the economy
  • Purchase of a combination of net worth certificates and some equity (preferred shares; senior stakes) in these insolvent companies by the Treasury
  • Relaxation and rewriting of mark-to-market rules which don’t make sense in the present context
  • Buying troubled mortgages directly, restructuring those deals, and selling those back into the market later
  • Forcing banks to cancel dividends and issue new equity on the private market
  • Bringing back the 0.25% tax on stock trades (which was in force from 1914 to 1966) while cutting long-term capital gains tax somewhat – this would generate revenue while discouraging speculation
  • Encouraging executive compensation plans tied to long-term productivity
These are the best ideas I have seen on the net (Sebastian Mallaby; Anil Kashyap; Raghuram Rajan; Luigi Zingales; William Isaac; William Gross; some of my friends).

13 Comments:

At 3:30 AM, Anonymous Anonymous said...

Dr. Ambati...follow the link below. This article raises enough questions to completlely disqualify Obama for any US office including the Senate. I'm not sure I agree with its conclusion but I believe the facts are correct.

http://americanthinker.com/2008/barack_obama_and_the_strategy.html

 
At 5:58 AM, Blogger JimNicholas said...

Dear Dr Ambati:

Governor Palin got her pronunciation wrong; you got your grammar wrong in this post. Neither kind of error means either of you is not intelligent.

I appreciate the thought that went into your posting.

Best wishes,

Jim

 
At 6:19 AM, Anonymous Anonymous said...

Regarding your points--
Pakistan:

The U.S. support for Musharraf was a balanced and rational response to the logistical requirements for a campaign in Afghanistan, and realization that he was quite possibly the one man in Pakistan that could reign the Islamist linked ISI. While there are simply no easy answers with regard to Pakistan, the moderate approach, vice BHO's stated "invasion of Pakistan" is clearly the one in keeping with U.S. foreign policy goals.

Let's ask what there is to be done? Simply denouceing Pakistan does no good, and actively tipping Pakistan into some level of failure by our kinetic actions serves our purposes., how?

Iran:
The Iranians continue tipping point of our problems throughout the CENTCOM area of operations. We have plenty reasons to go to war with the Iranians, but the end state in Iran, and how to get there, simply isn't at the doable level. What we CAN do, is continue to corrode the institutionial underpinnings of the Iranian regime, with our support of a secular, Shi'ite dominated, country in Iraq.

History has amply demonstrated that negotiating with the Iranians is like Peanuts football, as the ball always gets pulled and the goalposts moved. Negotiations legimatize the Iranian mullahocracy, and marginalize the vast majority of Iranians. BHO's ideas of negotiation with the Iranians are worst than wrong, they are counterproductive.

 
At 7:26 AM, Blogger Tom Grey said...

Good ideas and analysis, tho you fail to consider Reform or Corruption, something Sarah Palin does have experience in.
Doing successful reform, successfully fighting corruption in her own party. Obama, none.


A better idea would be for the Treasury to offer to buy houses, foreclosed and nearly so, at about the 1995 level of prices. So low that most banks won't want to sell--but at least a certain number.
(from Belmont Club)

 
At 7:56 AM, Anonymous el gordo said...

Although I cannot follow every issue in detail, I think you are relying far too much on only one side for your information.

First, since I´m not a regular reader I have to ask: surely you have heard about Obama´s deep relationships with political radicals and Chicago machine politics?

I understand your view of Palin, but she went against her own party to fight corruption and actually did something for her state, on her own, which required some courage and gave her a stellar popularity rating. So please let us not be too snobbish here. Obama voted against any reform, if he voted at all. The facts - the few we have - point to a hardline partisan with extremely left-wing convictions. Other than that, the man is a cypher with no achievements whatsoever.

You probably know all of that already. If not, you may want to google for a couple of articles by Stanley Kurtz or the book by David Freddoso.

A couple of other points: We have not been "ignoring" Iran. That is a cliche that pundits throw around.

I find it remarkable that you blame the Bush administration for the actions of its enemies (which include the authors of the NIE and the UN).

Regarding Pakistan, of course both Bush and McCain know what is going on there. But our options are limited and a responsible leader cannot say everything he thinks. Last November, Obama accidentally blurted out something about invading Pakistan if necessary. It was seen as a gaffe then and he didn´t repeat it for a while. But his campaign noticed that it was toughening up his image and it was a tested line so he is repeating it now. Of course he doesn´t mean it, he is just imprudently burning our foreign policy capital to get elected.

I am not an expert on health care, but are you sure McCain was cutting funding for veterans? I heard that there was nothing to this story.

Regarding Palin, the quote is not unclear at all. Palin did NOT say that the Iraq war is God’s plan. It was deliberately misrepresented and even edited that way in a youtube-video. Many more lies have been told about Palin. You don´t have to like her. The salient question is: doesn´t it worry you that you are being lied to, systematically?

And if you believe that Iraq really wants us out by 2010 - is this official Iraqi policy? Or an ambiguous remark by a politican? Either way it´s unlikely because the interests of both nations are against it now. You may complain about Bush mismanaging the war but who except McCain has offered any constructive criticism? Not the Democrats who first voted for it; they just poisoned the political climate for six years while we were at war. You will never convince me that they didn´t want to lose it for partisan gain. Rep. Clyburn said as much (an improved situation in Iraq "would be very bad for us")

I also happen to think that McCain did his job last week in Washington and the deal is much better for it than it would have been. If you can account for the massive anti-Republican media bias, McCain looked better than Obama here. I can only hope Obama will be more interested in the job of president than he is in the job of Senator.

 
At 8:57 AM, Anonymous Anonymous said...

I'll just do Pakistan.
Everybody on the right understands that Pakistan is an enemy PRETENDING to be an ally.
The problem is that they are about #4 on the 'to do' list. So the best thing to do politically is pretend they are allies and hold them closer, but in front of us.
I expect the Military to take over again before next summer, so this is one of those cases were doing nothing right now is the best policy.
The ideal solution would be for the Paki's to ask for our help with the terrs in Pakistan. If they were allies in fact, not just name, they would have already done that. Al Qaeda owns the Paki intelligence service, so until there is a coup and the Army has a chance to clean that up, it's better to leave things were they are.
Do you really think that starting a nuclear war will be an improvement?
That is the logical outcome of Ohhhhh......BAAMA's policies.

The big problem the Western liberals have is that the Islamic fundis EMBRACE death. That is why they don't have any troubles recruiting suicide bombers. So any sort of MAD won't work with them. They don't mind dying, so long as we die too. They say so and their deeds back up those words. You cannot stop a suicide bomber with a death threat. With MAD , that is what you are trying to do. It's illogical.

Ex-fetus

 
At 12:56 PM, Anonymous Dai Alanye said...

I suggest you look closely at Obama's background before utilizing only a rather sterile look at policies to judge him.

Consider his story about leaving a high-paying Wall Street position to become a community organizer. Co-workers at that company, including one who backs him, have pointed out gross exaggerations. The job was low-paid drudgery, putting together newsletters based on the reports of others. He was, in effect, a copy editor. Contrary to Obama's tale there were no suits and ties, no secretary, no conferences with Japanese financiers.

As a community organizer he himself admitted that his efforts were ineffective, bringing about the choice to go into law and politics.

Despite the common claim that he was a Constitutional law professor, he was actually a part-time lecturer, not even on the tenure track.

In the Illinois Senate he accomplished little, being given credit by Emil Jones, the majority leader, for bills conceived and shepherded through by others. And as we all know, he has accomplished nothing of note in the U S Senate.

You have here the case of a man who has created a legend of great doings, and he's still about it, attempting to take credit for the bailout bill (should it ever pass) by claiming to be in continuous communication with the Treasury Secretary, as if that would mean anything even if it were true.

Even in terms of policies, Obama has no record of experience or interest which would lead one to conclude that it is he rather that some set of advisers who has created any of the policies he promotes. I suggest to you that, aside from recent cramming, he has no knowledge of the economy or financial system, in addition to his ignorance of foreign and military affairs.

Palin, whom you demean, has an actual record of accomplishment. Indeed, find another governor who has achieved so many momentous things in as short a period--I know of none.

Whether her IQ is equal to Obama's I do not know, but then neither is his equal to mine nor, probably, to yours. But it is not simply by IQ and oratorical ability that nations are successfully governed.

 
At 2:12 PM, Blogger soflauthor said...

Dr. Ambati,

Although I cannot agree with some of your conclusions, your analysis is well constructed.

I guess my primary concern is that you have accepted Barack Obama's stated positions without analyzing his past behavior—his legislative accomplishments, his past associations, his profound lack of executive experience, and his unfettered journey through one of the most corrupt political machines in this country.

Stated bluntly, Senator Obama has accomplished very, very little that inspires confidence. What did he accomplish after Harvard Law, as a community organizer, as a state senator? Are any of his early "accomplishments" (other than writing two books about himself) long lasting and important? What specifically has he accomplished legislatively at the federal level? When has he exhibited the "bipartisan" point of view that he so often sells? How can you admire the judgment of a man who has close and long term associations with convicted felons, racist preachers, and extreme-left political ideologues such as Bill Ayers?

My Dad used to say: "Don't listen to the words, examine the deeds." That seems like a reasonable criterion for making your choice. And if you look at the deeds, it is simply no contest—McCain comes out on top.

 
At 2:33 PM, Blogger Georgfelis said...

I was only planning on writing a few lines in response to your article . Then it kind of snowballed to the point where I didn’t want to hog the comments area. So I linked it on my blog, I hope you don’t mind.

 
At 4:58 PM, Anonymous armchairpun said...

A number of thoughts, but for now one:

The US cannot credibly engage with Iran or Syria or Pakistan if we do not wrap up Iraq with a bow. Those regimes (and other like Russia and China and N. Korea) will believe that dealing with us is merely a waiting game. Further, would-be partners will have to think hard about the prospect of watching US choppers depart as they did from the rooftops of Saigon, leaving behind many who would face certain extermination.

 
At 12:14 AM, Anonymous wf said...

I do not see any evidence (apart of his own words) that Obama is in any way a moderate or bipartisan character. The official line of his campaign does not jibe with the behaviour he has shown in the past. He was indebted to the Chicago political machine. When he couldn´t avoid taking a stand, he refused to support reformers and took reliably the most left-wing position. He has never shown any bipartisanship in the Senate or in his campaign, unlike McCain.

How can you assure me that this is not the real Obama?

Does he have any pals who are not leftwing radicals or corrupt? Give me just one! You know the litany: Ayers, Dohrn, Rezko, Frank Marshall Davis, Wright, Pfleger. ACORN. All incidental? Why isn´t the media interested in any of this, especially given the frankly bizarre fixation on Sarah Palin´s tanning bed, Todd Palin´s 1986 DUI and a free facial she once received?

Why should it give me confidence that he has close advisors such as Fannie Mae CEOs Raines and Johnston, who together with congress have sabotaged our financial system? Or that he received in a very short time the second most contributions from Fannie/Freddie after Chris Dodd?

Why should I ignore the fact that Obama has repeatedly lied with disturbing ease to inflate his record and take credit for other people´s achievements? (I bet he does no longer claim to run the banking committee)

This is in my opinion a man who has designed his identity, first for himself, then for the public. This is a man who does not understand why anybody would object to his relationship with a racist priest (to whom he steered tax money) or an unrepentant terrorist with whom he steered grants to liberal edcuation causes.

Why should I not be concerned about the thuggish behaviour of his supporters and campaign managers?

Why would we give the White House to a party that already controls both Houses and has been a disaster so far (and make no mistake, Pelosi and Reid are clearly not for drilling or nuclear energy, nor has Obama made a clear commitment)

Given the way he talks, what is the evidence that Obama has even any love for the country he wants to lead? I mean the real country with its traditions and history, not the one he and his wife envision or the one they constantly complained about until his campaign smartened up (that would be the wife who got a 200 K raise after he became Senator; later he gave a million dollar earmark to his wife´s employer).

Do I question his patriotism? Obama has clearly questioned McCain´s patriotism on one occasion and Pelosi has done it to the GOP congress recently, so I assume it is allowed now. The difference is that McCain doesn´t have to prove anything in that regard.

 
At 12:24 AM, Anonymous TMLutas said...

I respectfully disagree that Obama is a good choice.

The first mistake is to consider a president as an individual alone. To vote is to select a team and while the team surrounding McCain/Palin has its problems, the team surrounding Obama/Biden is so profoundly corrupt that they are in an entirely different league.

McCain's largest executive experience is the command of a fighter wing which he whipped into shape and got them their first unit citation. The records are reasonably well examined and it's a modest command that he performed well in. Obama's largest executive experience was the Chicago Annenberg Challenge, where he disbursed $160M in funds over several years and got zero results benefitting the preparation of Chicago's youth for higher education (test scores moved not an inch) but considerable progress in introducing radical left-wing political indoctrination into primary and secondary education. Obama's record is less well exposed but if you dig, you can find it with critiques coming from both left and right.

Obama is dangerously naive in foreign policy, a problem that tends to spawn crisis and death as dictators think that they can 'take' a young pup of a president prior to him growing into office. It was Khruschev's estimation at their Vienna meeting that Kennedy was weak that led to the Cuban Missile Crisis. With Obama promising face time to dictators in his first year, this is not reassuring.

But Obama's foolhardiness in regards to Pakistan is the cherry on top of a confection of weakness. It completely misunderstands the strategic challenge of Al Queda.

The nature of the strategic assault that Al Queda is launching is quite different than the tactical one of bombs and bullets that garner the headlines. They wish to overturn the geopolitical board and return to a status quo ante that is less congenial to western forms of organization and power and more congenial to the islamic system as they conceive it.

By placing themselves, time and again, in places where attacking them is likely to require us blowing big holes in the present system of state sovereignty (the system is called westphalianism after the treaty that launched it), they hope to undermine it to the point where it collapses.

Simply crossing the border into Pakistan without admitting it is an act of geopolitical hypocrisy. That's bad enough but there's plenty of history for such action and the Bush administration has done plenty of this. McCain would follow in that mold. But Obama would strip the pretense away and throw the entire system on the ash heap without coming up with any sort of suitable replacement. This would be a huge strategic victory for Al Queda, even if Bin Laden would fall to Obama's tactics faster than McCain's.

The consequences of the end of Westphalianism are rather dire but the system has been in place so long (since 1648 in fact) that we are hardly equipped to begin talking about a fit replacement. The US has never operated outside the Westphalian system and it is quite possible it could not exist outside it. This is the reason why McCain shook his head and said "you just don't say that" when Obama outlined his Pakistan plans.

The cut and thrust of a campaign is a poor place to begin a fundamental education plan regarding the death of Westphalianism. It's not a partisan political issue so there is no benefit to raising it during a campaign. But for Obama to act to tear down such a foundational concept without even making as much of a pretense as the Bush administration has made is just disqualifying.

 
At 3:33 AM, Anonymous Anonymous said...

Present, present, and present. That's how I vote.

In addition, I am protected by the 'Fruit of Islam.'

Children sing about me and my supporters create T-shirts in the spirit of Lenin and Maoist China.

That is all.

- B. Obama

 

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