Monthly Archives: July 2011

Growing dissatisfaction with Washington

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The big losers in the current protracted battle over the U.S. debt ceiling and budget deficits are the politicians in Washington. Confidence in them drops drastically for each day that passes without the agreement and compromise that the overwhelming majority (two thirds) of the American public demands.

Congress has become a laughing stock, writes Charlie Cook, a most respected political commentator, in his latest “The Cook Report”.

“Right now, we are at a very, very low point–the worst I’ve seen since I moved to Washington in September 1972. Never in my memory have both parties and both ends of Pennsylvania Avenue appeared as dysfunctional as they do today. The stakes are so high and the performance is so utterly disappointing. “

They should be afraid of their jobs, Cook writes, and predicts that many of the current members of Congress will not be re-elected in next year. The only thing that could pave the way for a solution to the current crisis is that the stock market crashes and that interest rates rise sharply.

Then, perhaps, Washington’s politicians will wake up and come to their senses. But late today there were no such signs. On the contrary. The ideological battle seems to have hardened even more.

Whatever the outcome, all politicians, including Obama, have lost support, according to recent polls. Only 41 percent of all voters now prefer Obama to be re-elected while 40 percent prefer a Republican candidate, according to Pew Research Center’s latest figures. And according to the latest Gallup surveys, Obama’s support is at a record low, only 40 percent, while only 41 percent approve of how he has handled the debt ceiling crisis. The President’s only consolation may be that the congressional leaders receive even weaker support, Speaker John Boehner (31 percent) and Majority leader Harry Reid (23 percent).

Klinsmann takes over U.S. soccer team

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Tonight is friendly game of soccer, but it’s not any friendly, and maybe it won’t be very friendly … that is at least what the 82,000 in sold-out FedEx Field just outside Washington DC are hoping.

Barcelona against Manchester United. The world’s two soccer clubs meet again after the final of the Champions League in May, when Barcelona was clearly the superior team. Maybe Manchester is thirsting for revenge, and perhaps there is a chance now when Lionel Messi — “The Boy Genius” — still has the summer off after a busy international match schedule.

The sold-out FedEx Field underscores the huge business interests of both clubs here in the United States, where they have millions of fans which they want to retain and build upon, as soccer continues to grow in interest and importance even though American football, baseball, basketball, and ice hockey all are still more popular.

The big soccer news here is otherwise that former German star player and coach, Juergen Klinsmann, has been put in charge of the U.S. national soccer team. He is taking over from Bob Bradley, who was fired last week after two big disappointments: the U.S. loss to Ghana in last year’s World Cup and this year’s loss in the Gold Cup final against Mexico by 2-4, after leading 2-0.

America’s soccer federation has tried several times before to land the now 47-year-old Klinsmann, who lives in Southern California and is married to an American. George Vecsey gives a good insight in today’s New York Times as to what challenges Klinsmann will be facing in his new job.

 

To Obama: use the Constitution and raise the debt ceiling

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As August 2 is fast approaching, more and more politicians, legal experts and commentators, are urging President Obama, as a last resort, to take matters into his own hands and with reference to the Constitution raise the debt ceiling unilaterally.

After all the negotiations and an intense week in Congress, we are no closer to the compromise that is required, and this weekend’s upcoming votes and continued negotiations do not in any way guarantee a positive outcome for America and the world.

It is at this point of great uncertainty that the possibility for Obama to refer to the constitution and unilaterally raise the debt ceiling surfaced in the debate. It is an interesting alternative, which Obama himself has admitted, but he and constitutional experts do not seem to be really sure if that this is possible way out and if this would be constitutional.

The debate centers on the Fourteenth Amendment’s fourth paragraph, which says:

“The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pension and countries for service in suppressing insurrection or rebellion, shall not be questioned.”

In other words, U.S. government debt must not be questioned. The Amendment came about after the Civil War to prevent the South from cancelling the debt that the Union had incurred.

Jack Balkin, a law professor at Yale University, shows how the Amendment could be used by President Obama on his blog Balkinization, and Ronald Dworkin, a law professor at New York University, asks on the New York Review of Books blog if Congress would act unconstitutionally if it cannot decide to raise the debt ceiling.

This “last resort” has been advocated by a number of leading Democrats led by former President Bill Clinton. The consequences are uncertain but such a decision by Obama could lead to an impeachment process in the House of Representatives. Would Obama be prepared to wage such a fight only a year before the presidential election? That is the question.

Still, Professor Dworkin sees political benefits of such a decision.

“I doubt very many now uncommitted voters would disapprove of a President who acted under a reasonable interpretation of the law to allow the government payments on which they rely to continue, and to prevent damage to our international credit that would inevitably increase their taxes and might well eventually savage their standard of living. “

Michael Tomasky on the Daily Beast realizes the political risks, but adds:

“If Obama moved forcefully and said. ‘I am the president, and I met them here and here and here, and they wouldn’t budge, and I’m finished with them, and now is the time to act,’ I have little doubt that the markets—and the people—would react positively. That would prove that he’s a leader, and it would force him to choose sides. It’s high time he did both.”

Abolish the debt ceiling!

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This is a great idea: abolish the debt ceiling!

Every other county, with the exception of Denmark, does fine without it. We don’t need it and shouldn’t have it. Instead of figuring out ways to raise the debt ceiling, we should simply go ahead and abolish it, writes James Surowiecki in his Financial Page column in the latest issue of The New Yorker.

Europe wonders and worries about America

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President Obama’s and Speaker Boehner’s television speeches last night were not what we generally had expected or hoped for. There was no news and their speeches did not in any way contribute to a solution of the debt ceiling and budget crisis.

They did not leave us with even a glimmer of hope that the politicians in Washington can, and will, resolve this issue before the country defaults next Tuesday.

Already before last night, the wonderment and worry abroad about where America is heading was noticeable. “Washington is drowning America” is a recent headline on a Financial Times column by Clive Crook. He writes that when he came to America six years ago he had no patience for the view that the country was entering the twilight years, but now he is having second thoughts.

For those of you who know some Scandinavian, I would like to refer you to my old paper, the Stockholm daily Dagens Nyheter, whose recent headline to its main editorial about the debt ceiling crisis was “Fools’ paradise,” and in which “Republican fanatics” get the main blame. And in the Danish daily Politiken, one can read the Republicans, now run by the “almost anarchistic” Tea Party-movement, have “lost their senses.”

It is likely that after last night’s speeches the wonderment and worry will increase. It’s imp0ortant to point out that these are not radical voices but middle-of-the-road European newspapers commenting on the state of our union, and for everyone who cares about America’s reputation abroad, this is sad, and worrisome.

Deadlock on debt ceiling continues in Washington

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The politicians in Washington have not been able to compromise, at least not yet, and their failure has brought America to the abyss just a week before August 2, when the debt ceiling must be raised so that the U.S. government will not default and be forced to cancel its payments.

Despite long and intense negotiations, the parties are still far apart. Last Friday, the House of Representatives Republican President John Boehner left the negotiating table for the second time, and an angry, almost bitter President wondered whether the Republicans can say “yes” to anything.

Unsuccessful negotiations continued during the weekend between party leaders in Congress, and today, the Democrat leader in the Senate Harry Reid and the Republican Speaker John Boehner presented separate proposals as solutions to the crisis. But the two proposals differ substantially, and the chances for reconciliation and compromise seem minimal even though Ezra Klein in his Washington Post blog outlines a possible way for the two sides to come together.

Meanwhile, the impasse continues and the uncertainty and anxiety have increased noticeably in recent days. The world’s stock markets today reacted negatively to the deadlock in Washington, and tonight, President Obama addresses the nation, underlining how serious the situation is, although everyone stills says that the debt ceiling will be raised.

But how, when each side consistently trashes the other’s proposals, and when ideology consistently trumps good sense and pragmatism?

The inconceivable — that the world’s largest economy with AAA rating could soon be unable to pay its debts — can no longer be excluded.

Away…to fine music and good food

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Washington is warmest in the entire country, 100 degrees today, and over 100 degrees in the days to come.

We go outdoors only if we absolutely have to. Indoors, the air conditioning is humming, thank goodness, and I fear for all those who do not have air conditioning and I wonder how everyone coped in the old days, before air conditioning was invented.

On days like these you just want to get away, like the other day when we headed west to the wondrous landscape of Rappahannock County, Virginia, towards the Blue Ridge Mountains and the Shenandoah National Park.

We headed to the village of Castleton and the Castleton Festival, a relatively new place of pilgrimage for lovers of classical music in the American capital, where conductor Lorin Maazel, from the New York Philharmonic and the Opera in Valencia, Spain, bought a lot of land a few years ago and now makes music every summer. This year is the festival’s third year. Several hundred young musicians from over twenty countries spend the summer here, treating festival visitors to works by Puccini, Kurt Weill, Ravel, Stravinsky, Bizet, Gershwin, etc. in the former chicken coop that has become a nice little concert hall or in the large festival tent.

Castleton is located about 60 miles from Washington and if you want to spend the night, there are many small inns in the area. The most famous is The Inn at Little Washington. It was opened in 1978 by Patrick O’Connell, who still runs what has now become one of America’s best restaurants. The dinner after the concert is excellent and we are full of contentment during the return to Washington and no one is homesick.

“Atlantis” lands — what will happen now?

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The era of the space shuttle is over. In the pre-dawn darkness today, the space shuttle “Atlantis” touched down for the final time, ending the shuttleprogram’s 30-year history after 133 successful landings.

As it landed, I remembered many of the previous flights but especially the two that ended so tragically, “Challenger” on January 28, 1986 just a little over a minute after takeoff, and “Columbia” on February 1, 2003, as it was re-entering the earth’s atmosphere minutes before landing.

Three shuttles remain from the program. “Atlantis” will likely be exhibited at the Kennedy Space Center in Florida, “Discovery’s” home will the Smithsonian’s Air and Space Museum near Dulles Airport outside of Washington, DC, and the “Endeavour” will be housed at the California Science Center in Los Angeles.

Yesterday, it was 42 years ago that man set foot on the moon. What will happen now? No one knows. Thousands of employees of the space program will lose, and are already losing, their jobs. If Americans want to go into space in the near future, they will have to do it with the help of the Russians. That hurts, for everyone who remembers “Sputnik.”

Minnesota is open again

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Minnesota is open again after closing down on July 1 when the Democratic governor and the Republican controlled State Legislature could not agree on next year’s budget.

Today’s agreement came after governor Mark Dayton gave up on his insistence on raising taxes for the state’s millionaires to help solve the budget deficit of five billion dollars. On the other hand, the Republicans gave up on their proposals to ban stem cell research, abortions, and the right to collective bargaining.

In other words, a compromise.

Will we see something similar here in Washington before August 2? If not, the United States might also be forced to close.

Spending too much, taxing too little

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The discussions continue, new proposals are floated, old ones are revived, but there is still no agreement while the deadline, August 2, is rapidly approaching when the U.S. can no longer pay its expenses without the debt ceiling being raised.

Lots of talk about a balanced solution, about spending and cuts and taxes. What is then the state of the U.S. economy? Has the U.S. spent too much? Are taxes too low? These are questions that Factcheck.org. tries to answer in a recent study.

Here are some excerpts:

 U.S. federal spending is the highest since World War II, while incomes are the lowest in more than 60 years. In figures this means that spending represents 24 percent of GDP, while the federal revenues dropped to 15 percent of GDP.

 This has resulted in a budget deficit of 10 percent of GDP, the largest deficit since 1945.

 Tax cuts and America’s wars in Iraq and Afghanistan are the reasons behind the large deficit.

 Federal income tax receipts have dropped sharply since the tax cuts under George W. Bush, from 10 percent of GDP to 6 percent today.

 Today, the U.S. borrows 36 cents of every dollar spent.

 Of federal spending, 20 percent goes to Social Security, 13 percent to Medicare, and 8 percent to Medicaid, while 20 percent goes to defense. Foreign aid accounts for only 0.9 percent of total federal spending.

All this points to a serious imbalance in the U.S. economy. How, if at all, can Washington solve this problem? That is today’s big question.